Replies to post #23730 on Patient Access Solutions Inc (PASO)

[NM1978]

Do nasdaq stocks even have shells to merge into? Wouldn't they get delisted and turn into otc?

[Orion1972]

Timing imho..

[Bogartboy]

You’re right with your concerns....

Look at the otc page...PASO refiled their quarterly again today...they just keep on refiling lololol...billion dollar backup with multiple refilings?

If it’s too good to be true.....you know what they say

[Deuces]

It’s not like they’re taking over a completely defunct shell that used to sell beer nuts. OTC stocks are ripe for the picking especially the ones that have proprietary assets and technologies that bigger companies can use to build on. Less red tape on the OTC and cheaper too, not to mention the offsetting tax implications. Much more to it than what you’re seeing on the surface.

[MoneyForNuthin]

So you have answered your own question. Easy enough to find the answers with a few search terms, as you have already posted:

https://investorshub.advfn.com/boards/read_msg.aspx?message_id=156382598

So, to answer your question...

"Right but if CLX and UST are so big. Why not merge into a nasdaq shell?

Why they choosing a pink shell?

This confuses me."

...the simplified answer is summarized in the link from your post here:

https://investorshub.advfn.com/boards/read_msg.aspx?message_id=156382581

Where the Reverse Merger Rule applies, a company seeking to list on any NASDAQ exchange must meet the following requirements beyond those applicable to non-reverse merger companies:

1. The company’s stock must trade for at least six months after the completion of the reverse merger and filing with the SEC of audited financial statements for the post-merger combined entity. During this six-month period, the stock must trade on “the over-the-counter market, another national securities exchange, or on a listed foreign market.” The “pink sheets” would not meet this requirement.

2. The company’s stock must maintain a bid price of at least $4.00 per share on at least 30 of the 60 trading days immediately preceding the filing of the initial listing application.

3. The company must “timely file” six months worth of financial statements following the reverse merger. For domestic issuers (the shell was a US entity or the company is a smaller reporting company that elects to file on domestic forms), this requirement means that the issuer has filed at least two periodic financial reports (Forms 10-Q and/or 10-K). These reports would be considered timely if they are filed within the time required, including any extensions. For foreign private issuers (the shell is not a US entity and the company has not voluntarily elected to file on domestic forms), this requirement would impose an obligation to file financial statements for a period of not less than six months. Foreign private issuers are required by the SEC to file an annual report six months after the end of the fiscal year but not quarterly reports; NASDAQ further requires, under Listing Rule 5250(c)(2) that a company file on Form 6-K an interim report including balance sheets and income statements for the first half of the fiscal year within six months after the end of the second quarter.

(source: https://www.kaufcan.com/news/articles/nasdaq-proposes-enhanced-requirements-for-reverse-merger-companies/)

...which states that the resulting company in a reverse merger must trade on an exchange like the OTC for a period of time before listing on NASDAQ.

You can also imagine that, following consummation of the merger, the company will likely begin the process of SEC reporting in order to satisfy the requirements (as summarized in the article from Kaufman & Canoles - link provided above - clearly states that the company must file audited financial statements with the SEC for a "seasoning period" of at least 6 months on “the over-the-counter market, another national securities exchange, or on a listed foreign market.")