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Microcap & Penny Stocks : Scambusters

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To: David C. Burns who wrote (164)	10/30/1998 8:27:00 PM
From: Arcane Lore	Read Replies (1) of 178

At long last: PROPOSED RULE CHANGE The National Association of Securities Dealers has filed a proposed rule change (SR-NASD-98-51) under Rule 19b-4 of the Exchange Act relating to microcap initiatives-amendments to NASD Rules 6530 and 6540. Publication of the proposal is expected in the Federal Register during the week of November 2, 1998. (Rel. 34-40606) sec.gov For those that don't know or recall what NASD rules 6530 and 6540 are, they are the rules related to requirements for membership on the OTC BB and the requirements for marketmakers in such securities: 6530. OTCBB-Eligible Securities 6540. Requirements Applicable to Market Makers For those whose memory needs refreshing (it's been almost six months since the proposed rule changes were approved by NASD), here is a link to the original NASD announcement: nasdaqnews.com The proposed rule change was forwarded by the NASD to the SEC on July 17, 1998. Here is a link to the press release for that: otcbb.com Next step will be publication next week in the Federal Register followed by a comment period (two months?). The final rule will then be drafted and published in the Federal Register (an additional three or four months?). Based on historical precedent, following publication of the final rule I would expect there will be a six month period until the rule becomes official (for companies on the OTC BB at the time of publication of the proposed rule in the Fed. Reg.). There will then be a 90 day (?) period after which BB companies will need to be current in their Edgar reporting. If not, there will likely be an appeal process of some sort allowing a few more months on the BB. After that it's off to the Pink Sheets. If my guesstimates about the time periods are accurate, it will not be until the first quarter of 2000 before the first company is kicked off the OTC BB for being delinquent in their filings. The deluge should come in the second quarter of 2000.

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