News - Smokefree Continues to Create Conditions Aiding in Global Lock Removal
07/27/2011 @ 7:20AM
Through Company President, George Roth, Smokefree Innotec, Inc. (Pink Sheets:SFIO) announced today that the Company has been investigating every available avenue to cause the lifting of the DTC Global Lock imposed on "All Participants, Depository Facilities and Pledgee Banks" (Notice# B1017-11 Dated: July 1, 2011).
"This order was not directed at the Company, only to the brokerage community. According to the DTC website (www.dtcc.com), the purpose of the lock is to protect the integrity of the pool of any shares held by the DTC in their depository for their clearing transactions in the trading systems. In view of the extraordinary trading of June 30th and July 1st in SFIO shares, where well over half of the public float changed hands in two days in a huge volume of transactions, it appeared that certain large brokers and individuals were buying and selling naked.
The DTC dealt with this by imposing a "Global Lock" where brokers MUST match up buys with sell orders that they already have on hand, and cannot execute orders without matching them up. Some shareholders may have found that under these circumstances they could not buy any SFIO shares; their brokers did not have any legitimate shares to sell and could not sell short as is the custom, then going to other brokers to buy and cover, and they may have been desperately seeking shares to cover their own short positions. As you have seen from the past few weeks, with the Global Lock in place, the market has settled down, with domestic and foreign brokers finding shares to cover. The Company has refrained from making any announcements during this time that anyone could use to unduly influence an orderly market.
Eventually the DTC will be satisfied they are not holding any "phantom" shares created by shorters, and we expect the DTC order will be lifted when they are convinced an orderly market will resume and investors will be protected, but only after further actions and publications are soon taken by the Justice Department and the SEC regarding the disposition of charges against our former CEO.
The Company is continuing to prepare new information statements and accounting reports to update the OTCMarkets and provide transparency to investors, and we hope the investing public can understand the difficulty we are faced with in view of the unresolved charges against our former CEO. Obviously we cannot make any comment about that matter at this time, but reserve the right to set the record straight in our disclosure filings and reports with the OTCMarkets. The company denies any wrongdoing by the Company itself; only the former CEO is charged with performing an unauthorized and unlawful act in 2009.
Meanwhile, the Company is conducting business as usual in extending its distribution network and creating new websites. Nominees to the new Board of Advisors are considering their possible acceptance and will be announced shortly."
