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Series LLC and the Replicate Model – Two Viable Structures for Fractionalizing Ownership in Assets
28 August 2025
Series LLC and the “Replicate” Model for Fractionalized Regulation A Offerings
28 August 2025
Regulation A+
The Regulation A Launchpad to Getting Listed on OTCQB
August 28, 2025 by in Regulation A+

Regulation A has been the premiere choice for many issuers seeking to raise capital as it mimics a public offering in terms of investor acquisition capabilities. Many issuers tend to confuse executing a Regulation A offering with also getting listed with a trading symbol on OTCQB (Over-the-Counter Quality Board) – these are separate processes. In summary – Regulation A tends to be a launchpad for many companies seeking to ultimately list on OTCQB as the Regulation A process, compliance, and needed vendors satisfies many of the prerequisites for listing on OTCQB.

To be listed on the OTCQB a company must meet certain eligibility requirements. The OTCQB is a market tier for early-stage and developing companies that are still not listed on a national securities exchange (such as the NYSE or NASDAQ). Below are the key requirements for listing on the OTCQB:

1. Company Eligibility
  • Active Business: The company must be an active business with operations, and it cannot be a “shell” company.
  • Securities: The company’s securities must be registered with the SEC or be eligible for exemption from registration.
2. Audited Financials
  • The company must have audited financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), or International Financial Reporting Standards (IFRS). These audits must be performed by a PCAOB-registered audit firm.
  • Companies must file annual financial reports (Form 10-K or equivalent) with the SEC or provide audited financial statements if they do not file with the SEC.
3. Disclosure Requirements
  • Companies must meet ongoing disclosure obligations by providing current information to the market. This typically includes filing quarterly reports (10-Q), annual reports (10-K), and disclosing material events on Form 8-K.
  • The company must make all reports available on the OTC Markets website for investors.
4. Market Maker
  • The company must have at least one market maker that is willing to sponsor the company’s securities on the OTCQB. A market maker is a broker-dealer that facilitates the buying and selling of a company’s stock.
  • The market maker files an application with OTC Markets to “quote” the company’s securities on the OTCQB.
5. Shareholder Requirements
  • The company must have at least 50 beneficial shareholders who each own at least 100 shares.
  • The company must also have a minimum bid price of $0.01 per share.
6. Management Certification
  • A senior officer of the company must sign a management certification indicating that the company is in compliance with all applicable laws, including federal securities laws and OTC Markets requirements.
7. Compliance with OTC Markets Standards
  • The company must agree to comply with the OTC Markets Group’s corporate governance standards and auditor qualifications as part of the listing.
  • Companies must not have been involved in any significant securities law violations, and they must provide timely and accurate disclosure about their financials and operations.
8. Ongoing Fees
  • OTCQB companies must pay an annual fee to maintain their listing on the platform. The fee is typically $12,000 per year, but it can vary depending on the company and its situation.
9. No Suspension or Delisting
  • The company must not be under suspension or delisting from any exchange or regulatory body. If the company is facing potential delisting from an exchange, it may not be eligible for OTCQB listing.
10. Legal and Regulatory Compliance
  • The company must comply with all applicable state and federal securities laws, including securities trading rules and regulations.

Regulation A issuers will already have audited financials typically performed by a PCAOB audit firm and will also be satisfying reporting via the required SEC Regulation A update reporting (Form 1SA and Form 1K) along with typically using the Regulation A offering to build the proper shareholder base.

In summary, Regulation A issuers that are interested in getting listed on OTCQB tend to be well prepared for that process as Regulation A requires some of the prerequisites needed for the listing.

Interested in raising capital for your company? Call us today to discuss!
(720) 586-8610

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