123ArticleOnline Logo
Welcome to 123ArticleOnline.com!

ALL Business >> View Article

Going Public On The Otcqb

By Expert Author: Hamilton Securities

Many private companies seeking to go public are opting to list on the OTCMarkets OTCQB. The OTCMarkets Group operates an electronic inter-dealer quotation system called OTC Link. OTCMarkets ranks issuers in tiers; each issuer's rank depends upon the amount of disclosure provided.

Issuers using Form S-1 registration statements followed by Rule 15c2-11 applications to go public qualify for the "OTCQB" tier. The QTCQB tier is only available to issuers who file reports with the SEC. These issuers are not required to provide additional disclosures to the OTCMarkets.

In order for a private company to go public on the OTCQB, it must become anSEC reporting issuer. Once the company is reporting, it can then obtain its ticker symbol assignment from the Financial Industry Regulatory Authority ("FINRA") if it meets certain requirements.

SEC Reporting l OTCQB Going Public Transactions

A private company seeking to go public can voluntarily become reporting either by filing a Form 10 registration statement to register a class of securities under the Securities Exchange Act of 1934, as amended (the "1934 Act") or by registering securities on a registration statement under the Securities Act of 1933, as amended (the "1933 Act"), typically on Form S-1. All companies qualify to file a registration statement on Form S-1.

Once a private company's registration statement becomes effective, the company is an SEC reporting issuer, but its stock cannot yet be publicly traded. First it must comply with Rule 15c2-11 ("SEC Rule 15c2-11") of the 1934 Act.

15c2-11 Requirements for OTCQB Going Public Transactions

In order to use 15c2-11 to go public and have its shares publicly traded, the private company must locate a sponsoring market maker who is a FINRA member to file an application on its behalf.

The FINRA Comment Process in OTCQB Going Public Transactions

FINRA may render comments to the Form 211 application; the sponsoring market maker and company must respond to the satisfaction of FINRA. Once FINRA is satisfied that the disclosures satisfy the requirements of SEC Rule 15c2-11, a trading symbol will be assigned and the company will have completed its going public transaction. The market maker can quote the company's securities on the OTCMarkets OTCQB tier.

The sponsoring market maker has the exclusive right to publish quotations for the security of the company going public for the initial 30 day period after the Form 211 is approved. After that, other market makers can "piggyback" on his Form 211, and publish their own quotations.

A list of market makers who file 15c-211 applications can be obtained from the OTCMarkets website at www.otcmarkets.com.

15c2-11 Disclosure Requirements in OTCQB Going Public Transactions

The disclosures required by Rule 15c2-11 are provided on the Form 211 submitted by the sponsoring market maker. FINRA requires specific disclosures in the Form 211 and in the Information and Disclosure Statement, which includes much of the same information found in an SEC Registration Statement.

FINRA Rules Applicable to the Going Public Process

SEC Rule 15c2-11 requires that current public information be made available to investors. This information is initially provided on Form 211 and in the 15c2-11 application to FINRA. The sponsoring market maker must review basic issuer information prior to publishing quotations of an issuer's securities. FINRA also requires that market makers have a reasonable basis for believing the information provided by the company is accurate and from reliable sources. A private company that goes public and becomes an SEC reporting issuer satisfies the ongoing current public information requirement by filing its forms and reports with the SEC.

Qualifying for OTCMarkets' OTCQB provides transparency to investors and is a straightforward method for small companies to go public, and to enjoy the benefits that status confers.

This informational memorandum is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. For more information concerning the rules and regulations affecting the use of Rule 144, Form 8K, FINRA Rule 6490, Rule 506 private placement offerings, Regulation A, Rule 504 offerings, SEC reporting requirements, SEC registration on Form S-1 and Form 10, Pink Sheet listing, OTCBB and OTCMarkets disclosure requirements, DTC Chills, Global Locks, reverse mergers, public shells, go public direct transactions and direct public offerings or please contact Hamilton and Associates Securities Lawyers. Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates

Total Views : 53Word Count Appx. : 740See All articles From Author

Business Articles

1. Asphalt Driveway Repairs In Long Island How To Go For It?
Author: Joshua Young

2. Why Social Videos Matters For Video Ad Networks
Author: mediaconversion

3. Meet The New York Fashionable Clothes Design Partner
Author: davudobuya55

4. High Quality Fashion Merchandising Site In New York.
Author: davudobuya55

5. Top Notch Designing Services In New York
Author: davudobuya55

6. Meet The Fashion Designing Experts Of New York
Author: davudobuya55

7. The Most Reliable Custom Embroidery Partner In Ny
Author: davudobuya55

8. Quality Automobile Locksmith Service Is All You Need
Author: rokyfernandis12

9. Keep Your Family And Business Safe With Lock Smith
Author: rokyfernandis12

10. Emergency Locksmith Services Are Readily Available
Author: rokyfernandis12

11. Discover Guaranteed Locksmith Services Today
Author: rokyfernandis12

12. Do Away With Crime For Good Effortlessly
Author: rokyfernandis12

13. Its True! Global Payroll Outsourcing Has Become Important
Author: Sandra Lee

14. Top 7 Factors To Consider While Choosing Amongst The Best Contemporary And Business Hotels In Delhi
Author: Satya Svelte

15. Translate For A New Atlas
Author: Shreya Gupta

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: