I have been dealing with consultants and attorney’s for Chinese Buyers for about a year now and the consensus is that “they don’t get it” when it comes to purchasing an OTCBB shell. Now I know this partially due to cultural differences but someone needs to explain to them how the system works. So for all of you Chinese Buyers - listen up! This Blog’s for you.

First of all, get the company you are vending into the OTCBB shell audited BEFORE you try to buy the shell. Here are the reasons. As much as you distrust Americans they distrust you more. So if you can’t provide a business plan of the company with audited financials no one will believe you have a real deal and they will not sell you their shell. Most Sellers understand they have to perform proper due diligence on the Buyer prior to selling the shell in case something goes wrong after the transaction. Think of it from our point of view. If there is an investigation into a foreign Company trading on the OTCBB chances are the Seller is the one who is going to take the heat from the SEC because he lives in the US and you are thousands of miles away and out of jurisdictional reach of the SEC.

Secondly, why would anyone spend $600,000 on a shell but not $20,000 to $40,000 on an audit prior to the purchase of the shell. This one I am still trying to figure out. Now I know there are brokers or consultants out there that want to buy a shell and later identify the company they are going to vend in but, unless you are a licensed broker-dealer or can demonstrate a history of previous successes, most likely no one is going to take a flyer on a future unnamed company that is going to end up in their shell at some later date.

Lastly, you don’t have to purchase a 90% plus delivery shell. The PERCENTAGE OF OWNERSHIP DOESN’T MATTER! A Buyer can take any shell that has over 51% and perform a reverse stock split in conjunction with the reverse merger and end up with a 99% shell. If I sell you a 90% delivery shell with 100,000,000 shares you still have 10,000,000 shares left in the float after you purchase the shell which means you still have to perform a reverse stock split. So, unless your needs include free trading shares of stock, the percentage of delivery doesn’t matter as long as you are getting at least 51% of the shares.

If you would like further explanation please feel free to call me direct at:

Ventana Capital Partners

Ralph Amato

858-729-0075

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