HERE IS THE DIFFERENCE
1. How does the Company deregister?
The Company deregisters by terminating its reporting company status under the Securities Exchange Act (the "Exchange Act"). This process is started by the Company's filing of a Form 15 under Rule 12g-4(a)(l) (having less than 300 record owners) or 12g-4(a)(2) (having less than 500 record owners and less than $10 million in assets). The Form 15 is very short -only 1 page. If after 90 days from the date the Form 15 is filed, the Company does not get any response from the SEC then the Company would cease to be a reporting company (as of the date the Form 15 was filed).
2. When can the Company stop filing SEC reports?
Immediately upon filing the Form 15, the Company's duty to file SEC reports is suspended (meaning, i.e., no need to file any 8-Ks, 10-Qs, etc.).
3. Can the Company withdrawal the filing of the Form 15 to stop the deregistration process?
Yes. The Company may withdraw the Form 15 before the 90 day waiting period has expired. If the Form 15 is withdrawn during the waiting period, the Company would have 60 days to file any SEC reports it would have been required to file during the time its reporting obligations were suspended.
4. Can shares of the Company continue to be traded on OTC BB as well as Pink sheets?
Once the Form 15 is filed, the shares of the Company will not trade on the OTC Bulletin Board ("OTCBB") but may continue to be traded on the pink sheets. Financial Industry Regulatory Authority ("FINRA) Rule 6530, which specifies the kinds of securities which market makers can quote on the OTCBB, does not permit market makers to quote securities of any issuer that is not required "to file reports pursuant to Section 13 or 15(d) of the Exchange Act." The market makers, therefore, would have to cease quoting the Company's shares on the OTCBB upon the filing of the Form 15 because at that point the Company's reporting obligations are suspended, that is the Company is not required to file SEC reports. The "pink sheets" is an unregulated market and the Company's shares may continue to trade despite the Form 15 filing.
5. If no brokers sponsor the Company to trade on either OTCBB or the pink sheets, what can the Company do to assist shareholders interested in selling or obtaining shares?
If the Company's shares are no longer traded on the OTCBB or the pink sheets, the Company has limited options to assist shareholders interested in selling or obtaining shares. The Company cannot act as an intermediary between shareholders to arrange a sale or purchase of shares (i.e., act as a broker). The Company may offer to repurchase shares directly from shareholders. The Company may also sell restricted shares directly to shareholders in compliance with exemptions from registration under Federal and state securities laws.
6. Does the Company still require the services of a transfer agent?
The Company is not required to keep a transfer agent, but it is advisable to keep track of shareholder records, especially because there will still be shares held in "street name" by Depository Trust, despite the lack of liquidity.
7. If the Company wishes to reverse the decision to deregister, how is that accomplished?
If the Company has ceased to become a reporting company, there are ways for it to become a public company again, though the process is lengthy and can be expensive. The Company would have to file registration statement type information with the SEC (either on Form 10to register as a reporting company under the Exchange Act or an S-1 to register its shares under the Securities Act) and find a market maker to submit a Form 211application with FIATRA for eligibility of the Company's shares to be quoted on the OTCBB.
