Marker Therapeutics Inc (MRKR)

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It's the DRS of the DTC, Not The Exit of the DTC

THURSDAY , JANUARY 30, 2003 02:24 AM

Jan 30, 2003 (financialwire.net via COMTEX) -- (FinancialWire) A schism has emerged among the small cap forces fighting naked short selling, as Matthew Marcus, principal in Integrity Securities, which represents FreeStar (OTCBB: FSTI) and Sionix (OTCBB: SINX), as well as Group Management (OTCBB: GMPT), is electing to utilize a little known mechanism within the Depository Trust Corporation (DTCC) providing for a Direct Registration System (DRS) rather than exit the DTC, as proposed by Investor Communications International on behalf of its clients and holdings, and which has formed the National Association Against Naked Short Selling.

GeneMax (OTCBB: GMXX), Ten Stix Inc. (OTCBB: TNTI), BlueBook International Holding Co. (OTCBB: BBIC), MidasTrade.com (OTCBB: MIDS), MSM Jewelry Corp. (OTCBB: MSMJ) and Make Your Move Inc. (OTCBB: MKMV) have taken ICI's advice and exited the DTC, and companies that have said that they are or are considering exiting DTC include Reeds Holdings Corp. (OTCBB: RDHC). Nutra Pharma Corp. (OTCBB: NPHC), Critical Home Care Inc. (OTCBB: CCLH), Hadro Resources Inc. (OTCBB: HDRS), Jag Media Holdings Inc. (OTCBB: JGMHA), InternationalBioChemical Industries Inc. (OTCBB: IBCL), SunComm Technologies Inc. (OTCBB: STEH), Bentley Communications Corp. (OTCBB: BTLY), Nutek Inc. (OTCBB: NUTK), ITIS Holding (OTCBB: ITHH), Environmental Products & Technologies (OTC: EPTC) and Edgetech Services (OTCBB: EDGH).

According to Marcus, "We have no relationship with, and have not contacted ICI." However, while he says his group supports any efforts to curb the illegal practice of naked short selling, he does not believe "ICI has done enough to build a relationship with DTCC and in exploring alternatives to going cert issue only such as the Direct Registration System, described at http://dtcservices.dtcc.com/custody/drshome.htm.

Marcus notes that the DRS system is SEC approved and will serve to accomplish strategic goals "without going back to the stone age of paper certs."

Marcus said that the system can incorporate a "Profile Surety Program" that offers the electronic equivalent of a medallion guarantee, providing comparable security to the transfer agent and the issuer that they previously had received through the signature guarantee on the paper transaction advice.

DRS provides investors with an alternate approach to holding their securities in certificate or "street" form. Under DRS, investors can elect to have their securities registered directly on the issuer's records in book-entry form. An investor electing to hold a security in a DRS book-entry position will receive a statement from the issuer or its transfer agent evidencing ownership of the security. The investor can subsequently transfer electronically the DRS book-entry position to a bank or broker.

This is the system that Group Management is undertaking not only to combat short selling but also to hold off a take-over attempt by debenture holders.

Marcus also said that his release that contained the names of some 5,000 companies did not have tickers coded, and has issued a press release threatening litigation against Accident Prevention Plus, Inc. (OTCBB: ACPL) which apparently issued a press release about Integrity Securities as a result of either a miscommunication or a misreading of the firm's proposals for small companies.