OTC Markets Newsletter
OTC Markets Group News August 2014
How Big Data is Changing Trading for Brokers, Investors and Companies

At OTC Markets Group, our mission is to create better informed and more efficient financial markets. A core part of our strategy is to widely distribute market data and company information on the 10,000 securities on our marketplaces to brokers and investors so they can make intelligent investment decisions.

Strong equity trading volumes combined with increased automation of broker-dealer compliance processes and regulatory oversight of broker-dealer operations have made convenient access to comprehensive, timely and accurate market and company data more important than ever before.

This spring we released our OTC Compliance Data File, a comprehensive file of key compliance data on OTCQX®, OTCQB® and OTC Pink® securities that is delivered twice daily in a pipe-delimited format. This file provides broker-dealers and compliance/risk management teams with details on key compliance data points in our market, including Penny Stock exemption status, bankruptcy and Caveat Emptor status, so they can analyze and monitor securities trading in an automated manner.

Click to read more.

Our OTC Compliance Data File complements our suite of Real-Time Market Data products and our End-of-Day Date File that provide comprehensive quote and trade data on OTCQX, OTCQB and OTC Pink securities. Our Company Data and Security Data files also provide valuable company officer, director and service provider information.

All of our market data products include a security’s marketplace designation – OTCQX, OTCQB or OTC Pink – which is used by many broker-dealer firms as a key input in their risk controls and compliance processes.

Getting the Right Data about the Right Companies

Of course as a market operator, we control only half of the equation when it comes to market data. We need companies to widely share their information with brokers and investors so efficient price formation can occur. In our electronic age, often an investor’s only relationship with a company’s shares is online through a broker system, market data terminal or financial portal. A blank screen, incorrect numbers or stale information create a digital dark alley that keeps investors away.

Missing or stale information on trading screens can also trigger broker-dealer risk controls that can impact the trading process by restricting investor access and overall liquidity of a company’s shares. Companies should acquaint themselves with some of these broker-dealer restrictions so they are informed. These include:

Penny Stock Rules (Rules 15g-2 through 15g-9, Schedule 15G, of the Securities Exchange Act of 1934) – The SEC generally defines a “penny stock” as any security that trades less than $5 per share and has limited assets or little revenues. Because penny stocks are considered speculative investments, broker-dealers are required to conduct additional due diligence and provide disclosure to a client before soliciting a transaction in these securities.

OTC Markets Group’s OTC Compliance Data File enables broker-dealers to immediately identify a security’s penny stock status (“exempt” or “non exempt”) and any available exemptions under the Penny Stock Rule. These exemptions include: a bid price of $5 or higher, net tangible assets of $2 million for the past three years or $5 million for the past two or more years, or average revenue of at least $6 million for the past three years.

OTCQX companies are required to meet the standards for exemption during the application process in order to qualify.

FINRA Rule 2114 – The Financial Industry Regulatory Authority, or FINRA, is a non-governmental regulatory body that is authorized by Congress to oversee the securities industry and broker-dealers. FINRA Rule 2114, “Recommendations to Customers in OTC Equity Securities,” requires broker-dealers to review current financial statements and business materials of an OTCQX, OTCQB or OTC Pink issuer before advising or releasing research notes on it to clients unless the issuer meets one of several exemptions. These include: if the issuer has at least $50 million in total assets and $10 million in shareholder's equity as stated in its most recent audited current financial statements, if the issuer is a bank or insurance company, or if the issuer’s securities have a bid price of at least $50 per share.

OTC Markets Group’s OTC Compliance Data File indicates to broker-dealers whether a security qualifies for one of these exemptions and provides all the corresponding data for each applicable exemption.

Caveat Emptor – OTC Markets Group identifies securities with a Caveat Emptor (skull and crossbones) symbol to inform investors when we believe they pose a public interest concern. This symbol is displayed in place of the company’s marketplace designation on our website, on OTC Dealer®, our front-end trading application for broker-dealers, and is distributed on all data feeds.

Our Caveat Emptor designation has been adopted by many broker-dealers, investors, clearing firms and other market participants to help inform trading decisions. In fact, many broker-dealers refuse to trade Caveat Emptor securities and are more cautious when recommending these securities to investors.

Technology has vastly improved the ability of investors to trade electronically, broker-dealers to automate processes and regulators to oversee markets. Modern public companies need investor relations programs that support compliance with the complex web of SEC rules, FINRA regulation and State Blue Sky laws applicable to the brokers and investors trading their securities. For companies to maximize their public trading market, they will need to clearly demonstrate their compliance and make sure that all market participants have consistent, current and correct data wherever they analyze, value or trade securities.

For more about the various rules governing trading of OTCQX, OTCQB and OTC Pink securities, visit the FINRA & SEC Rules section of our website. Broker-dealers, investors and other market participants interested in learning more about OTC Markets Group’s various market data licenses and how to subscribe should visit the Market Data pages of our site.

Click to close.

Contact Market Data Services at marketdata@otcmarkets.com to learn more.
[photo]Interview with George Toulantas, Director of Investor Relations, HEINEKEN

This month, we speak with George Toulantas, Director of Investor Relations at HEINEKEN, Europe’s largest brewer and the world’s second largest by volume. The ADRs of Heineken N.V. (OTCQX: HEINY) and Heineken Holding N.V. (OTCQX: HKHHY) began trading on OTCQX in January 2014. Mr. Toulantas talks to us about the company’s U.S. brand portfolio and continued growth in the emerging markets. With half of the companies’ top 20 institutional investors based in the U.S., he tells us about the importance of U.S. investor outreach and building visibility through OTCQX.

OTC Markets Group (OTCM): Everyone is familiar with Heineken beer, but Heineken N.V. actually has a diverse portfolio of global, regional and local brands. Tell us about some of your other major brands that would be recognizable to your U.S. customers.

George Toulantas: Dos Equis is one of the fastest growing beer brands in the United States. Consumer insights testing shows that the brand has one of the most recognizable marketing campaigns in the history of the beer industry (“Most Interesting Man”), which has won numerous awards.

Dos Equis recently released a line extension, Dos-a-Rita, a premium, ready-to-serve lager margarita that is already available in the Southeast region of the U.S. and will go national in 2015. Modeled after the popular cocktail recipe originally created on premise in Texas, Dos-A-Rita is a blend of Dos Equis Lager and classic margarita flavors, sweetened with 100% premium agave nectar.

The fast growing U.S. cider market also presents exciting opportunities for our Strongbow brand. Strongbow Hard Cider is a top priority for HEINEKEN USA with two new innovations in the U.S. this year: Strongbow Gold Apple Hard Cider and Strongbow Honey & Apple Hard Cider.

Click to read more.

Tecate is another important brand in our U.S. portfolio. Its strong Mexican roots and favorable demographic trends among a growing Hispanic population are contributing to strong growth of the Tecate Light brand, particularly in the Sun Belt region of the U.S.

Innovation is a key focal pillar of the HEINEKEN USA strategy. In addition to Dos-A-Rita and Strongbow, HEINEKEN USA also recently introduced Desperados, a beer blended with tequila barrel-aged lager that delivers a uniquely refreshing and smooth taste. As one of our most popular global brands, Desperados launched this year in select retail and on premise outlets in the Southeast region of the U.S.

In 2014, HEINEKEN USA also introduced Amstel Radler, another popular beverage from our global portfolio, in the Northeast region of the U.S.

OTCM: What other exciting marketing campaigns or programs do you have planned for the U.S. market?

Mr. Toulantas: We recently launched three new major marketing programs in the United States:

  • Heineken Light: Recently named the “Best Tasting Low Calorie Lager” winner at the 2013 World Beer Championships, the brand launched its “Best Tasting Light” campaign featuring three-time Emmy Award winner and Tony Award winner and host, Neil Patrick Harris. HEINEKEN USA will partner with Harris to introduce consumers to the reformulated Heineken Light and creatively bring the “Best Tasting Light Beer” award to life.
  • Heineken Cities campaign: This summer Heineken is inviting people across America to look up at the world around them, veer off the beaten path and embrace the unknown in their cities with Routine Interruptions. Now live on RoutineInterruptions.com, “The Payphone,” featuring Portlandia star, SNL legend and 2014 EMMY nominee Fred Armisen, is the latest in the Heineken series of social experiments that challenge real people to make a choice to get outside their comfort zone and shows what can happen if you let Heineken open your city.
  • Newcastle Brown Ale has been widely acclaimed as the leader in digital marketing with the award-winning campaign, “If We Made It.” The brand won 13 Cannes Lions Awards, as well as the Facebook Blue Award (it’s top annual honor) for “breaking through the clutter” of the “biggest, most overhyped, most saturated marketing event of the year” (the Super Bowl) by reinforcing Newcastle’s distinct social voice and resonating with its audience. The brand also recently launched another campaign, “If We Won,” which introduced a new holiday (Independence Eve) and reimagined what the U.S. would have been like if Great Britain had won the Revolutionary War.

OTCM: You have also been heavily investing in emerging markets like Asia Pacific, Africa and the Middle East. Tell us more about your expansion efforts there.

Mr. Toulantas: Today, around half of HEINEKEN’s group revenues and 60% of its group operating profit come from developing markets which includes exciting growth regions such as Africa, the Middle East, the Americas and Asia Pacific.

HEINEKEN has an established presence across the Africa and Middle East regions with 14 No. 1 positions and four No. 2 positions. This includes strong leadership positions in Nigeria, the Democratic Republic of Congo, Egypt, Burundi and Rwanda. We also acquired two breweries in Ethiopia a couple of years ago and are expanding our brewing capacity in the country with a new greenfield site. We are well placed to benefit from the long-term positive growth fundamentals in Africa including a growing population, an emerging middle class and rising levels of urbanization.

Asia Pacific is also a dynamic high-growth region for HEINEKEN where we have fourteen No. 1 or No. 2 positions, well ahead of any other international brewer. In 2012, we further consolidated our leadership position in the region following the acquisition of a full controlling stake in Asia Pacific Breweries. Important growth markets in Asia Pacific where we compete today include Vietnam, China, Indonesia, Papua New Guinea and Singapore to name a few. We also have significant export operations in Taiwan and South Korea and a market-leading position in India through our joint venture, United Breweries Limited.

OTCM: Heineken N.V. and Heineken Holding N.V. moved their sponsored ADR programs to the OTCQX marketplace on January 27 this year. Why was that an important move for you to make?

Mr. Toulantas: We have an important shareholder base in the United States with around 30% and 40% of our free float in Heineken N.V. and Heineken Holding N.V, respectively, based in the country. Through upgrading to the OTCQX marketplace we are able to optimize the visibility of our two sponsored level 1 ADR programs – Heineken N.V. (OTCQX: HEINY) and Heineken Holding N.V. (OTCQX: HKHHY). The OTCQX platform also supports our objective of ensuring full transparency and high-quality disclosure and further extending our investor outreach efforts in the country.

OTCM: What is Heineken’s investor relations strategy in the U.S. market?

Mr. Toulantas: HEINEKEN has a proactive investor relations approach and our activities in the United States represent a key element of our annual program. Around half of our top 20 institutional shareholders in Heineken N.V. and Heineken Holding N.V. are based in the United States, so we maintain a regular dialogue with both our shareholders and potential investors. We currently undertake two annual roadshows with our CEO and CFO to New York and Boston, with our investor relations team also visiting many other key cities representing large pools of capital, including San Francisco, Los Angeles, San Diego, Denver, Santa Fe, Chicago and Atlanta. We also hosted a “What’s Brewing” seminar in September 2013 (also webcast live) where our CEO of HEINEKEN USA, Dolf van den Brink, updated our shareholders and investors on our growth strategy in the country.

OTCM: What else do you want U.S. investors to know about Heineken N.V.?

Mr. Toulantas: Here are a few things U.S. investors should know about us:

  • HEINEKEN is present in over 70 countries and operates more than 165 breweries.
  • We are Europe’s largest brewer and the world’s second largest by volume.
  • Heineken, the brand, is the undisputed leading international premium beer brand.
  • We sell over 250 international premium, regional, local and specialty beers and ciders, including a powerful portfolio global brand portfolio to target new consumer segments – Desperados, Sol, Affligem and Strongbow.
  • Sustainability is an integral part of our strategy alongside our other commercial and business imperatives.
  • We are committed to delivering on ambitious plans for medium-term top-line growth, gradual margin expansion and consistently strong cash flow generation.

Click to close.

Light Up The Market
Paulo Gonçalves and Rodrigo Furtado, Investor Relations Officers of Cyrela Brazil Realty (OTCQX: CYRBY), visit the OTCQX Market Center to Light up the Market! They are joined by Dan Zinn (right), General Counsel of OTC Markets Group.

Follow us on Twitter at @OTCMarkets to keep up with OTCQX companies Lighting Up Their Market.

OTCQX companies Light up the Market in July and August to celebrate joining our best marketplace.

808 Renewable Energy Corp. (OTCQX: RNWR)
Cyrela Brazil Realty (OTCQX: CYRBY)
Integra Gold Corp. (OTCQX: ICGQF)
Isabella Bank Corp. (OTCQX: ISBA)
Marquette National Corporation (OTCQX: MNAT)
Mission Valley Bancorp (OTCQX: MVLY)
Quaint Oak Bancorp, Inc. (OTCQX: QNTO)

Monthly Trade Summary

July 2014

Marketplace Designations # of Securities* Monthly Dollar Volume Monthly Dollar Volume
per Security
YTD Dollar Volume Aggregate Market Capitalization
(in Millions)*
OTCQX® 358 $2,693,541,066 $7,523,858 $21,115,117,248 $1,551,923
OTCQB® 2,591 $3,518,637,701 $1,358,023 $45,583,280,157 $172,808
OTC Pink® Current Information 3,906 $8,923,169,238 $2,284,478 $69,842,446,706 $12,312,790
OTC Pink Limited Information 445 $151,120,347 $339,596 $1,504,969,157 $19,837
OTC Pink No Information 2,614 $1,046,812,843 $400,464 $8,447,194,118 $54,619
Totals 9,914 $16,333,281,196 $1,647,497 $146,493,007,387 $14,092,291
*Data as of July 31, 2014
Newsletter Sponsor
Regulation & Compliance
Reminder: UPDATE New FINRA ORF Platform
  The migration date for firms to begin reporting OTC equity security trades and trades in restricted equity securities effected pursuant to Securities Act Rule 144A to the new OTC Reporting Facility (ORF) technology platform becomes effective Monday, November 17, 2014. FINRA has also published a new FINRA OTC Reporting Facility (ORF) Migration Website. Frequently Asked Questions regarding the OTC Reporting Facility Migration can be found here.

New Certification Required upon Filing a Form 211
  FINRA has amended FINRA Rule 6432 (Compliance with the Information Requirements of SEC Rule 15c2-11) that requires members to certify that they have not accepted any payment or other consideration for market making from issuers and related persons. The new Form 211 may be found here.

Form 211 Information Repository
  FINRA is soliciting comment on a proposal to make publicly available through FINRA’s website a repository of Form 211 information. FINRA’s Regulatory Notice may be found here.
Events, Webinars & Sponsorships
Securities Transfer Association’s Annual Conference - Manalapan, FL (October 27-30, 2014)

5th Annual Depositary Receipt Issuers' Conference, Latin America - Campos do Jordão, SP Brazil (October 22-24, 2014)

IR Magazine Think Tank Canada - Toronto (October 8, 2014)

STA National 81st Annual Market Structure Conference - Washington DC (October 1-4, 2014)

Data Transparency Conference 2014 - Washington DC (September 30, 2014)

“Alternative Financing Methods” at the Canadian Investor Conference - Toronto (Sept. 25-26, 2014)

ACA Leadership Workshop – Columbus, OH (September 17-19, 2014)

FISD Technology Forum - New York, NY (September 16, 2014)

The Euro Pacific Capital 4th Annual Investment Conference – New York, NY (September 9, 2014)

8th Annual Depository Receipt Issuers' Conference, Indian Sub-Continent - Jaipur, India (September 4-7, 2014)

Contact us if you are interested in meeting us at one of these events.
OTC Markets Group Congratulates Immune Pharmaceuticals on NASDAQ Listing - press release (Aug. 21, 2014)

ISBA traded on the OTCQX marketplace - Midland Daily News (Aug. 16, 2014)

OTC Markets Group Congratulates Cellectar Biosciences on NASDAQ Listing - press release (Aug. 15, 2014)

OTC Markets Group Announces Second Quarter 2014 Financial Results - press release (Aug. 13, 2014)

Quaint Oak begins trading on new market - Bucks County Courier Times (Aug. 13, 2014)

STXNEWS LATAM-ADRs of Brazil's Cyrela to be traded on OTCQX - Yahoo! Finance via Reuters (Aug. 7, 2014)

Marquette National begins trading on OTCQX - SNL Financial (Aug. 5, 2014)
Fact of the Month
800+ TSX, TSX-V, and CSE listed companies are cross-traded on the OTCQX, OTCQB and OTC Pink marketplaces.
7 New Companies Qualified for Our Best Marketplace in July

Abattis Bioceuticals Corp. (OTCQX: ATTBF)
Chilean Metals Inc. (OTCQX: CMETF)
Greater Hudson Bank, N.A. (The) (OTCQX: GHDS)
Integra Gold Corp. (OTCQX: ICGQF)

Mission Valley Bancorp (OTCQX: MVLY)
Zazu Metals Corp. (OTCQX: ZAZUF)
A complete list of OTCQX companies is available on www.otcmarkets.com.

31 companies were verified to trade on OTCQB in July

ADM Tronics Unlimited, Inc. (OTCQB: ADMT)
Aero Grow International, Inc. (OTCQB: AERO)
Alkaline Water Company Inc. (The) (OTCQB: WTER)
AuraSource, Inc. (OTCQB: ARAO)
Blackcraft Cult, Inc. (OTCQB: BLCK)
Cachet Financial Solutions, Inc. (OTCQB: CAFN)
Circle Star Energy Corp. (OTCQB: CRCL)
Corindus Vascular Robotics, Inc. (OTCQB: CVRS)
CryoPort, Inc. (OTCQB: CYRX)
Dakota Territory Resource Corp (OTCQB: DTRC)
Drone Aviation Holding Corp (OTCQB: DRNE)
e.Digital Corp. (OTCQB: EDIG)
Gray Fox Petroleum Corp. (OTCQB: GFOX)
Halton Universal Brands, Inc. (OTCQB: HNVB)
Indie Growers Association (OTCQB: UPOT)

Las Vegas Railway Express, Inc. (OTCQB: XTRN)
Leatt Corp. (OTCQB: LEAT)
Magnolia Solar Corp (OTCQB: MGLT)
Mobetize Corp. (OTCQB: MPAY)
Naturally Splendid Enterprises Ltd. (OTCQB: NSPDF)
Nation Energy, Inc. (OTCQB: NEGY)
Orgenesis, Inc. (OTCQB: ORGS)
Petron Energy II, Inc. (OTCQB: PEII)
Sichuan Leaders Petrochemical Company (OTCQB: SLPC)
Sundance Strategies, Inc. (OTCQB: SUND)
Tauriga Sciences, Inc (OTCQB: TAUG)
Telik, Inc. (OTCQB: TELK)
The Pulse Network, Inc. (OTCQB: TPNI)
VistaGen Therapeautics, Inc. (OTCQB: VSTA)
Our Marketplaces
Cellectar Biosciences and Immune Pharmaceuticals graduated this month from OTCQX to an exchange listing. Congratulations on achieving this major milestone! OTCQX
The Best Marketplace

The Venture Marketplace

OTC Pink
The Open Marketplace
Contact Us
To learn more about OTC Market Group visit us at www.otcmarkets.com // +1.212.896.4420 // issuers@otcmarkets.com
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