Replies to post #17007 on Corporate Universe Inc (COUV)

[lesgetrich]

When a stock is halted, SEC Rule 15c2-11 requires that market makers are forbidden to trade the stock until the company finds a sponsoring market maker who will file a form 211 application to FINRA. From the SEC halt order...

COUV Suspension of Trading

Further, brokers and dealers should be alert to the fact that, pursuant to Rule 15c2-11 under the Exchange Act, at the termination of the trading suspension, no quotation may be entered unless and until they have strictly complied with all of the provisions of the rule. If any broker or dealer has any questions as to whether or not it has complied with the rule, it should not enter any quotation but immediately contact the staff in the Division of Trading and Markets, Office of Interpretation and Guidance, at [phone]. If any broker or dealer is uncertain as to what is required by Rule 15c2-11, it should refrain from entering quotations relating to COUV's securities until such time as it has familiarized itself with the rule and is certain that all of its provisions have been met. If any broker or dealer enters any quotation that is in violation of the rule, the Commission will consider the need for prompt enforcement action.

If any broker, dealer or other person has any information that may relate to this matter, they should immediately contact Scott A. Thompson, Acting Co-Regional Director, at [phone], or Kingdon Kase, Assistant Regional Director, at [phone]. The Commission appreciates the assistance of the Financial Industry Regulatory Authority.

By definition, if there is no Market Maker for a security, it trades on the grey market. However, it is possible for a sponsoring market maker to submit the form in a timely manner so that the security spends little to no time on the grey market. Usually, grey market securities have very light volume, however they can be traded. Most brokers will accommodate sale of grey market stocks but some of the major brokers will not allow you to buy them.

The Form 211 requires specific disclosures before the security can be traded again. The following link describes these disclosures in more detail...

What Disclosure Is Required By Rule 15c2-11?

Rule 15c2-11 under the Securities and Exchange Act of 1934 (Exchange Act) governs the submission and publication of quotations by brokers and dealers for OTC equity securities. Specifically, the rule applies to a broker-dealer’s initiation or resumption of quotations for such securities. Pursuant to the Rule, brokers and dealers are required to review and maintain specified information about the issuer of the security before publishing a quotation for that security. Rule 15c2-11 requires specified disclosures be submitted to the Financial Industry Regulatory Authority (“FINRA”) by the issuer’s sponsoring market maker on Form 211 before initiating quotations of a security. Any company seeking quotation of its securities should consult with a qualified going public attorney to discuss FINRA’s disclosure requirements.

Sponsoring Market Makers

In order to use Rule 15c2-11 in a going public transaction, the private company must locate a sponsoring market maker to submit the Form 211 application to FINRA on its behalf. FINRA may render comments to the Form 211 application which the sponsoring market maker and private company must respond to.

Rule 15c2-11 requires that the company have current public information available before the market maker can quote the security. The information required in the Form 211 satisfies the current public information requirement of Rule 15c2-11...

Whether and how quickly COUV recovers depends on how well they can defend themselves against the questions which were raised by the SEC. We really don't have any clarity on exactly what the SEC is objecting to. Hopefully we'll get a better understanding of what's happening on Monday when we hear from COUV again. In the meantime, we should all take a deep breath and hope for the best. With any luck, the Carbon Ion merger will get back on track if COUV can provide good answers to the SEC questions.

[Threeflight]

Yes. Just use your normal broker. However there will be no bid and ask.