Post Closing of the OTCBB Shell

After the Buyer has closed on the shell an 8K (or super 8K as previously discussed) will be filed with the SEC by counsel. If the Buyer is performing a reverse split of the stock along with the reverse merger then counsel will also be filing either an Information or Proxy Statement with the SEC. Additionally, the Buyers attorney will also be asking for a name change, a new cusip number and a new trading symbol.

The SEC changed the notification rules for Proxy and Information Statements effective as of August, 2007. An issuer can now send a “post card notification” to shareholders which will direct them to your Internet site. You can post the Information or Statement on your Internet site. You have to give shareholders 40 days from receipt of this type of notification before you can reverse the stock.

Now if you have less than 50 shareholders you can shorten the 40 day period by sending your shareholders a complete package of all of the documents but this can become very expensive if you have a substantial number of shareholders.

Per our suggestion, a recent client of ours sent out a post card notification to over 1200 shareholders that cost les than $600.00. If the company had decided to send the information through a traditional full package mailing it would have cost over $10,000.00. Quite a difference in pricing!

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