Rule 144 Requires Current Public Information Before Stock Can Be Sold
In order for a securities attorney to draft a Rule 144 opinion letter, there must be adequate current information about the Issuer publicly available before the stock can be sold.
SEC Reporting Companies Must Have Filed SEC Forms 10-Q, 10-K, and 8-K
For SEC reporting companies, such as those on the OTCMarkets OTCQB, OTCQX, and OTC Bulletin Board (OTBB), this generally means that the companies have complied with the periodic reporting requirements of the Securities Exchange Act of 1934, which provides for the filing of SEC Forms 10-Q, 10-K, and 8-K. This is easy for securities lawyers at the Law Office of Matheau J. W. Stout, Esq. to verify, either at OTCMarkets.com or via SEC.gov.
OTCMarkets Bulletin Board and Pink Sheet Companies Need to Be Current
For non-reporting companies, such as Pink Sheets, this means that certain company information about its business, its officers and directors, and its financial statements, is publicly available in Disclosure Statements and Quarterly and Annual Reports.
OTCMarkets Makes It Easy To See Which Companies Are Current in Their Filings Under Rule 144
As a practical matter, OTCMarkets.com has made confirming this requirement easy through its market tier system. Simply put, a securities attorney can tell at a glance whether the current public information requirement of Rule 144 is met–if the Issuer is an OTCQX, OTCQB or Current Pink, then the Issuer is “current” under the Alternative Reporting Standard.
What to Do If the Issuer is Not Current Under Rule 144
If the Issuer is listed on OTCMarkets.com as Yield Sign (Pink Limited Information), the Company may only be late in one of its Quarterly or Annual Reports or a Disclosure Statement, which might easily be corrected by communicating with management and finding out how much longer they expect it will take to catch up.
If, on the other hand, the Issuer is listed as a Stop Sign on OTCMarkets.com, the Company may be delinquent anywhere from a few months to several years in its filings, and there may be little hope of clearing the stock under Rule 144. (When that happens, contact an experienced securities attorney like Matt Stout to inquire about other SEC provisions, such as 4(1), which might allow the stock to be cleared).