OTC Markets Newsletter
OTC Markets Group News           JULY 2015
Introducing OTCQB: America’s Premier Venture Market
A Message from our CEO

[photo]Last Spring, OTC Markets Group embarked on a project to transform our existing OTCQB market into a premium venture market for developing public companies. Many of the people we talked to at the time said it couldn’t be done. How were we going to convince public companies to undergo an annual management certification process, background checks and provide additional verifications and disclosures above and beyond what is required by the SEC?

Just over one year later, I’m proud to say – we’re on the right track. It is clear that improving transparency and trust is good for brokers, investors and OTCQB companies.

Nearly 1,000 companies have been verified and are approved to be traded on our “new” OTCQB® Venture Market. They include companies from 48 U.S. states and territories and 25 countries and a wide variety of industries from technology, healthcare and financial services to energy, consumer goods and utilities.

The median market capitalization of OTCQB companies is $12.8 million. Compare that to the $2.1 million median market cap of companies on Canada’s TSX Venture Exchange and $28.8 million on London Stock Exchange’s AIM market and OTCQB ranks squarely among the world’s leading public venture markets.



Today we can truly say America has a real Venture Market for public companies! It is the market developing companies need today so they can grow tomorrow.

Yet while we have approved nearly 1,000 companies on OTCQB, we have also removed more than 2,000 because they failed our bid price test, were in bankruptcy or were unwilling to meet our stricter OTCQB standards. These less transparent and riskier companies have been downgraded to our Pink Market where they can continue to trade electronically with the appropriate broker-dealer risk controls around them. The lighter regulated Pink Market allows cash strapped companies to focus their resources on restoring their operations, refinancing their debts or reinventing their businesses.

Meanwhile, OTCQB is providing a more transparent, better regulated public trading market for developing companies that are committed to providing a high-quality trading and information experience for their investors.

That includes companies like Eastside Distilling, Inc. (OTCQB: ESDI), a Portland, Oregon-based maker of award-winning handcrafted spirits that is using the public market to raise capital at more favorable rates than it would as a private company, and Soligenix, Inc. (OTCQB: SNGX), a Princeton, NJ-based late-stage biopharmaceutical company that is using OTCQB to provide liquidity to shareholders and build visibility with retail and institutional investors.

It also includes non-U.S. companies like CanAlaska Uranium Ltd. (TSX-V: CVV; OTCQB: CVVUF), a Canada-based uranium exploration company that is leveraging its listing on Toronto’s TSX Venture Exchange to broaden its global shareholder base in the U.S.

One day these companies could upgrade to our OTCQX® Best Market or even join the hundreds of other companies that have graduated from our markets to a stock exchange listing.

In the meantime, enjoy the improved transparency and trust these companies and other companies are providing by visiting the Stock Screener on our website here and selecting “OTCQB.” There you will find companies’ latest financial filings (including their annual CEO Certification), news, stock charts and a complete real-time Level 2 quote montage showing the available liquidity in their stock.

A Big Step to a Better Future

Our mission and vision at OTC Markets is to create better informed and more efficient financial markets and to expand the world of investment opportunities. We do this by connecting a network of brokers that provide liquidity and execution services to a wide spectrum of securities, organizing those securities into markets to better inform investors of opportunities and risks and helping companies provide better information to facilitate better pricing in their securities.

We are grateful for the large number of OTCQB companies that have made the important choice to improve the trading and information experience for their investors, the broker-dealers trading and committing capital on our OTC Link® ATS trading platform and the strong network of investors, attorneys, investment banks and other advisors that have supported us over the past year.

I personally also want to thank our fantastic team at OTC Markets Group that have worked hard over the past year processing applications, educating and answering issuers’ questions and making this effort a success.

Together we are building the New Network Markets for capital formation.

Best wishes,

R. Cromwell Coulson
President and CEO
OTC Markets Group Inc. (OTCQX: OTCM)
COMMUNITY SPOTLIGHT
[photo]Interview with William E. Snell, Jr., President and CEO, Franklin Financial Services Corp.

This month, we speak with the President and CEO of Franklin Financial Services Corp. (OTCQX: FRAF), William E. Snell, Jr. The Pennsylvania bank, which has more than $1 billion in assets and 22 banking offices, talks to us about joining the OTCQX market last year, maintaining a strong financial performance in 2015 and moving forward with the company's strategic plan. With a return of 33% in 2015, Franklin Financial was ranked among the top 50 best performing OTCQX stocks last year.

OTC Markets Group (OTCM): Tell us about Franklin Financial Services Corp. and F&M Trust.

William E. Snell, Jr.: Franklin Financial is the largest independent, locally owned and operated bank holding company headquartered in Franklin County, PA, with assets of more than $1 billion. Its wholly-owned subsidiary, F&M Trust, has 22 community banking offices in South Central Pennsylvania and provides a variety of financial solutions to individuals and businesses. Franklin Financial stock is trading on the OTCQX market of the OTC Markets under the symbol FRAF.

Click to read more.

OTCM: What differentiates F&M Trust in the south central Pennsylvania market?

Mr. Snell: : A unique offering as a community bank, we have a long tradition of providing Investment & Trust Services since acquiring fiduciary powers in 1906. F&M Trust maintains nearly $600 million of trust assets under management, excluding an additional $136 million held at third-party brokers. Our Investment & Trust Services fee income totaled $4,575,000 in 2014. For the first six months of 2015, our Investment & Trust Services fee income increased by 20.9%, reflecting the addition of new client relationships and higher market valuations.

In addition to our Investment & Trust Services, we are continually working to evolve our financial product and service offerings to meet the banking needs of our customers. We offer a wide array of financial services and technology for both individual customers and businesses such as mobile banking, remote deposit and cash management to name a few. What makes us unique is our ability to not only build relationships with customers, but adapt to their needs.

From a financial performance perspective, Franklin Financial is uniquely positioned amongst our peer group due to a higher level of non-interest income and lower cost of deposits. This contributed to our selection as a 2015 OTCQX Best 50 performing company.

OTCM: Franklin Financial upgraded its stock to trade on the OTCQX market last October. What caused you to make that move and what do you see are the benefits of trading on a premium market with high financial and disclosure standards?

Mr. Snell: We believe OTCQX will provide better visibility and exposure to Franklin Financial and ultimately improve the liquidity of our stock. Since joining the market last year, we have observed an increase in trading volume when news is released about our financial performance.

OTCM: You were ranked among the top 50 best performing OTCQX stocks last year with a total return of 33%. Why do you think you have been so successful?

Mr. Snell: Our financial performance has remained strong despite the low interest rate environment and costs associated with additional regulation. We attribute our success to focusing on three key areas: expense control, increasing fee-based lines of business and strengthening our overall loan quality. As a result, earnings increased last year by nearly 35% over the previous year and remain strong in 2015. We reported earnings of $2,884,000 for the first quarter of this year, which represents a 58% increase when compared to first quarter earnings in 2014. Our first quarter 2015 earnings were enhanced by two nonrecurring events that increased noninterest income by $899,000. These events included a gain of $171,000 from the liquidation of an off-shore insurance company in which the Bank held an ownership interest and a $728,000 gain on the conversion of equity securities held by the Bank as the result of an acquisition. Without these events, earnings for the quarter would have been $2,290,000, which still represents a 25% increase over 2014. Earnings for the second quarter of 2015 increased by 6.7% over last year, and for the first six months of 2015 increased 29.3% to $5,358,000 compared with the same period in 2014. Our adjusted earnings for the first six months of 2015 were $4,764,000, without the nonrecurring events, an increase of 14.9% over the previous year.

OTCM: What is your strategy for growing your shareholder base and communicating with investors?

Mr. Snell: Our strategy to grow our shareholder base and communicate with investors is a multifaceted approach. We will rely heavily on our partnership with OTCQX and leverage the opportunities provided to tell our story. For example, we are planning to participate in an upcoming community bank “Virtual Investor Conference”, which is a perfect environment to share information about Franklin Financial with a broad investor audience. Additionally, we are in the process of developing an outreach program that will specifically target local investors through a number of channels. The program will include participation in investor forums, in-person presentations, public relations and shareholder communications. We believe this strategy will elevate our status as a top-performing community bank within the investor community.

Another very important aspect of our shareholder relations program is our Dividend Reinvestment and Stock Purchase Plan. The plan provides shareholders with a convenient and economical way to purchase additional shares of Franklin Financial common stock by reinvesting cash dividends paid on their shares or through optional cash payments. Since amendments were made to the plan in September 2010 to enhance our capital adequacy, in excess of $5,000,000 has been invested. We are delighted with the response received from shareholders, many of which are new to Franklin Financial, both in terms of participation and the increase in the level of voluntary cash contributions.

Shareholders can find more information about the Dividend Reinvestment Plan (DRIP) and Franklin Financial by visiting our website at www.franklinfin.com.

OTCM: What else do you want shareholders to know about your company?

Mr. Snell: We are committed to earning the right to stay independent by building long-term shareholder value. To that end, we have historically paid a dividend to shareholders and recently increased our dividend for the second quarter of 2015 by 11.8% over the same period in 2014. Our current annualized dividend yield is 2.91% based on the closing stock price as of March 31, 2015.

We continue to make progress in a number of areas related to our strategic plan, specifically the development of a sales culture. As we move forward with this initiative, we are transforming every aspect of our sales process – from how we identify and hire front-line sales personnel to how we manage and track sales performance. Additionally, we are introducing a branch model that will not only provide a better experience for customers, but will also break down the barriers of traditional banking. Features of the new design include an open floor plan and interactive technology that allows employees to demonstrate products and share information.

As a community bank, we take great pride in providing support for the communities we serve. Our employees spend countless hours volunteering at community events and serving on boards and committees with various non-profit organizations. We are also consistently named one of the “Best Places to Work” in Pennsylvania and “Best Bank” in a number of our local markets.

Click to close.

Trans-Atlantic Information Flow: #NoBlankScreens
[photo]OTC Markets Group, PR Newswire and the Investor Relations Society Host the “Trans-Atlantic Information Flow” Forum in London.

The panel discussion included Will MacLaren, Head of Investor Relations at easyJet PLC (LSE: EZJ; OTCQX:ESYJY), which trades on OTCQX in the US; Mark Hynes, PR Newswire Investor Relations Consultant; Richard Price, Partner at international law firm Shearman & Sterling LLP; and John Gollifer, General Manager of the IR Society.

View the media gallery and key findings from the event.
Light Up The Market
OTCQX companies Light up the Market in July to celebrate joining our best market.

RestorGenex Corporation (OTCQX: RESX)
OmniComm Systems, Inc. (OTCQX: OMCM)
Commencement Bank (WA) (OTCQX: CBWA)

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

June 2015

Market Designations # of Securities* Monthly Dollar Volume Monthly Dollar Volume
per Security
YTD Dollar Volume
OTCQX® 403 $3,362,220,047 $8,342,978 $21,279,467,864
OTCQB® 1,109 $1,231,421,543 $1,110,389 $14,235,617,346
OTC Pink® 8,340 $12,256,103,524 $1,469,557 $72,008,593,635
Totals 9,852 $16,849,745,115 $1,710,287 $107,523,678,845
*Data as of June 30, 2015
Events, Webinars & Sponsorships
News
Take Stock! Conference - Calgary (November 6, 2015)

82nd Annual Market Structure Conference - Washington, D.C. (September 30 - October 2, 2015)

OTCQX Senior Executive and Issuers Forum - Toronto (September 24, 2015)

FinFair 2015 NYC - New York, NY (July 29, 2015)

Contact us if you are interested in meeting us at one of these events.



View our recent webinar co-hosted with Dresner Allen Caron for a discussion on building a successful investor relations program for community bank stocks.

Marketing Your Community Bank | Investor Relations Strategies with IR Firm Dresner Allen Caron & OTC Markets
OTC Markets Completes Venture Market / OTCQB Rollout - Crowdfund Insider (July 22, 2015)

OTC Markets Group Celebrates Completion of OTCQB Venture Market Rollout - press release (July 22, 2015)

OTC Markets Group, PR Newswire and the Investor Relations Society Bring Their Successful "Trans-Atlantic Information Flow" Event to London - press release (July 21, 2015)

Wedbush: Buy the Bitcoin Investment Trust - Barrons.com (July 14, 2015)

Why Cash Is Pouring Into Small Companies - Inc. online (July 10, 2015)

Boulder Energy starts trading on OTCQX - Stockwatch (July 9, 2015)

Money.Net Adds OTC Markets Data to Terminals - Inside Market Data (July 7, 2015)

New SEC rules make investing in startups easier for average folks - San Francisco Chronicle (July 6, 2015)

Heritage Bankshares approved to trade on off-exchange market - Inside Business (The Hampton Roads Business Journal) (June 26, 2015)

IPO for All or How to Create Your Own Currency - Huffington Post (June 26, 2015)
MARKET DATA UPDATES
Money.Net now offers its subscribers, including professional and non-professional investors, access to Real-Time Level 1 (best bid/best offer quotes) and Level 2 (full depth of market) for 10,000 OTCQX, OTCQB and OTC Pink securities. Learn more.



Q2 2015 Index Performance

Indexes Q2 Return
OTCQX Composite -3.9%
OTCQX Billion+ -4.0%
OTCQX International 0.0%
OTCQX U.S. 5.1%
OTCQX Banks 5.1%
OTCQB Venture -5.1%
OTCM QX ADR 30 -1.3%
OTCM ADR 0.0%

Read more about the second quarter performance of the OTCQX and OTCQB Indexes, OTCM ADR Index and OTCQX30 Index

For more information, contact our Market Data Services at +1.212.220.2166 or marketdata@otcmarkets.com.
REGULATION & COMPLIANCE
IR MAGAZINE AWARDS
ATS Data Fees Eliminated

In late June, FINRA filed for immediate effectiveness the elimination of fees associated with obtaining weekly ATS data under FINRA Rule 4552. FINRA reviewed the usage of the ATS Data and the costs incurred and decided to disseminate the ATS Data on its website at no charge. FINRA noted that Rule 4552 was intended in part to increase transparency in the over-the-counter market, and that the Rule has achieved this goal by providing individual investors with access to the ATS Data at no cost. FINRA also noted its belief that transparency may be further enhanced by eliminating the fee for Professionals and Vendors so that individual investors and the public can benefit from more detailed and widely-available analysis of the ATS Data. Read the text of the rule here.

Internalized Trade Transparency Proposal

On July 2, FINRA filed a rule proposal designed to expand its transparency initiative by requiring its member broker-dealers to publish the over-the-counter equity volume executed otherwise than on an ATS. FINRA is proposing to publish on its website weekly volume information (number of trades and shares) by firm and security (with a limited de minimis exception) on a two-week or four-week delayed basis in accordance with the time frames specified for ATS volume publication requirements. Read the text of the rule filing published in the Federal Register on July 9, 2015 here.
Global OTCQX companies were recognized for their leadership in investor relations at the IR Magazine Awards in July. Congratulations!

Europe

Allianz SE (OTCQX: AZSEY)

BASF SE (OTCQX: BASFY)


Brazil

Kroton Educacional SA (OTCQX: KROTY) - Best overall investor relations - super-large cap

Localiza Rent A Car SA (OTCQX: LZRFY) - Best overall investor relations - large cap
WHITE PAPER
McMillan: White Paper on Canadian Issuers Planning to Seek Admission to Trade on OTCQX and OTCQB

McMillan, one of Canada’s leading law firms, was approved as a Designated Advisor for Disclosure (DAD) and Principal American Liaison (PAL) this month. As a DAD and PAL, McMillan can act as the designated advisor for U.S. and international companies trading on the OTCQX.
GRADUATES TO A U.S. EXCHANGE
Congratulations to the companies that graduated from our markets to an exchange listing in June and July.

Aethlon Medical, Inc., (NASDAQ: AEMD)
Commerce Union Bancshares, Inc. (NASDAQ: CUBN)
ITUS Corp. (NASDAQ: ITUS)
Milestone Scientific Inc. (NYSE MKT: MLSS)
Pershing Gold Corporation (NASDAQ: PGLC)
Pieris Pharmaceuticals, Inc. (NASDAQ: PIRS)
Steel Excel Inc. (NASDAQ: SXCL)
OTCQX AND OTCQB NEW ADDITIONS
OTCQB
13 companies qualified for the OTCQX Best Market in June.

Amazing Energy Oil & Gas Co. (OTCQX: AMAZ)
Brilliant Sands Incorporated (OTCQX: BRSD)
Commencement Bank (WA) (OTCQX: CBWA)
First Virginia Community Bank (OTCQX: FVCB)
Frontier Oilfield Services, Inc. (OTCQX: FOSI)
Globo Plc (OTCQX: GOBPY)
Heritage Bankshares, Inc. (OTCQX: HBKS)

Independent Alliance Banks, Inc. (OTCQX: IALB)
Mill City Ventures III, Ltd. (OTCQX: MCVT)
Pinnacle Bankshares Corp. (OTCQX: PPBN)
Sono-Tek Corp. (OTCQX: SOTK)
The Pulse Beverage Corp. (OTCQX: PLSB)
Titan Energy Ltd. (OTCQX: TTENY)
A complete list of OTCQX companies is available on www.otcmarkets.com.


OTCQB
63 companies were verified to trade on the OTCQB Venture Market in June.

5Barz International Inc. (OTCQB: BARZ)
Aly Energy Services, Inc. (OTCQB: ALYE)
Artesian Resources Corp. (OTCQB: ARTNB)
Artex Corp. (OTCQB: ARXQ)
At Play Vacations Inc. (OTCQB: APYV)
Berkshire Bancorp, Inc. (OTCQB: BERK)
Blue Bird Corporation (OTCQB: BLBDW)
Briacell Therapeutics Corp. (OTCQB: ANCCF)
Cavitation Technologies, Inc. (OTCQB: CVAT)
Chesapeake Energy Corp. (OTCQB: CHKDP)
China Energy Technology Corp., Ltd. (OTCQB: CETH)
China Shianyun Group Corp., Ltd. (OTCQB: SAYC)
Cloud Security Corporation (OTCQB: CLDS)
Compliance & Risk Management Solutions, Inc. (OTCQB: CRMVD)
County First Bank (La Plata, MD) (OTCQB: CUMD)
DSG Global Inc (OTCQB: DSGT)
Duos Technologies Group, Inc. (OTCQB: DUOT)
Earth Life Sciences Inc. (OTCQB: CLTS)
EF Hutton America, Inc. (OTCQB: HUTN)
Endonovo Therapeutics, Inc. (OTCQB: ENDV)
EZJR Inc. (OTCQB: EZJR)
Fannie Mae (OTCQB: FNMA)
Farmers & Merchants Bank of Long Beach (CA) (OTCQB: FMBL)
First Northern Community Bancorp (OTCQB: FNRN)
Frontera Group Inc. (OTCQB: FRTG)
Glassesoff Inc. (OTCQB: GLSO)
GrandSouth Bancorporation (OTCQB: GRRB)
Green Standard Technologies, Inc. (OTCQB: GSTC) Hancock Fabrics, Inc. (OTCQB: HKFI)
IEG Holdings Corp (OTCQB: IEGH)
Image Intl Group Inc. (OTCQB: IMGL)

Immage Biotherapeutics Corp. (OTCQB: IMMG)
Immune Therapeutics, Inc. (OTCQB: IMUN)
Innocap, Inc. (OTCQB: INNO)
Jammin Java Corp. (OTCQB: JAMN)
Lattice, Inc. (OTCQB: LTTC)
Lifestyle Delivery Systems, Inc. (OTCQB: LDSYF)
Lissome Trade Corp. (OTCQB: LSOM)
M Pharmaceutical Inc. (OTCQB: MPHMF)
Magicstem Group Corp. (OTCQB: MGGI)
Massive Interactive, Inc. (OTCQB: HUGE)
MIX 1 LIFE, INC. (OTCQB: MIXX)
Novamex Energy, Inc. (OTCQB: NGLE)
NXT Energy Solutions Inc. (OTCQB: NSFDF)
ProtoKinetix, Inc. (OTCQB: PKTX)
Resort Savers, Inc. (OTCQB: RSSV)
Security Devices International, Inc. (OTCQB: SDEV)
Silver Bull Resources, Inc. (OTCQB: SVBL)
SocialPlay USA, Inc. (OTCQB: SPLYD)
Southern California Gas Co. (OTCQB: SOCGP)
Sputnik Enterprises, Inc. (OTCQB: SPNI)
Star Century Pandaho Corporation (OTCQB: SCPD)
StationDigital Corporation (OTCQB: SDIG)
Stragenics, Inc. (OTCQB: ASAB)
STW Resources Holding Corp (OTCQB: STWS)
Trycera Financial, Inc. (OTCQB: TRYF)
Tyme Technologies, Inc. (OTCQB: TYMI)
United Health Products, Inc. (OTCQB: UEEC)
Verde Science, Inc. (OTCQB: VRCI)
Viscount Mining Corp (OTCQB: VLMGF)
Wolverine Exploration, Inc. (OTCQB: WOLV)
Zenosense, Inc. (OTCQB: ZENO)
Zonzia Media, Inc. (OTCQB: ZONX)
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