Although companies with a history may have had serious past problems, they may still have novel and exciting developmental product(s) in the making that could become in high demand.
And/or the company may have pulled out of their past problems and are now productive valued companies that choose to remain on the Grey Sheets.
I am thinking though that many such companies would have been, or will likely be, targets to be merged with, or bought out by, larger companies if such super products, or patents, are actually in development that are worth their weight in gold.
Why?
Because if shares are available for public trading, such companies can be bought or controlled for a fraction of the price then if traded on a stock exchange or even the OTCBB. This deal is possible because of the low number of shares outstanding.
The idea for being listed on the Gray Sheets is most likely for seven major reasons:
• to obtain a stock symbol, transfer agent, and shareholder base without attracting attention from the general public, at least for the time being.
• to formulate, structure, and pursue a business plan and operation for future growth and success.
• to gain a history of trading, and shareholder growth, until such time that a company qualifies to offer public shares, or to be traded on the Pink Sheets, OTCBB, or one of the stock exchanges. This all depends on the goals of a company and its qualifications.
• to accumulate shares from private and public sources in preparation to meet requirements to be listed on the Pink Sheets or OTCBB.
• to get an idea of the investor reception once they are officially traded (for IPO's).
• to gain investor awareness and potential funding/financing options.
• to limit the fees and regulations associated with Pink Sheets, OTCBB or the Stock Exchanges. Many start-ups do not qualify to register to trade on the other financial markets.
In addition, the costs associated with registering can be prohibitive.
The Grey Sheets offer a start-up company the opportunity to grow so that later they may meet the qualifications and expenses to be traded on a more prestigious financial market.
