Over-the-counter (OTC) quotation

Being quoted is not a raise. The money comes from an offering: a registered public offering, a Regulation A offering, or a private placement. A quotation lets investors buy and sell the shares afterwards.

How shares come to be quoted: the OTC market is where securities that are not on a national securities exchange are quoted and traded. A company does not apply to it the way it applies to an exchange. Instead, under the SEC's Rule 15c2-11, a broker-dealer may publish a quote for a security only if it has reviewed current, publicly available information about the company and has a reasonable basis to believe the information is accurate and its sources reliable. The broker-dealer then files a Form 211 with FINRA and waits for FINRA to process it before it starts quoting. A qualified interdealer quotation system can do the information review instead and make a public determination that other broker-dealers can rely on.

What the information is: for a company that reports to the SEC (or reports under Regulation A Tier 2), its filings; otherwise, specified information the company makes public itself, including its business, officers and directors and financial statements. Since the SEC's amendments of 2020, in force from December 28, 2020, quotes cannot carry on indefinitely once a company's information stops being current, and shell companies can be quoted on the "piggyback" exception for only 18 months.

You cannot pay for a quote: FINRA rules bar its member firms from taking payment from a company, directly or indirectly, for quoting its shares or making a market in them, and the broker-dealer must certify this on its Form 211.

Reporting: quotation alone does not make a company report to the SEC. But a company with more than $10 million in assets and a class of shares held of record by 2,000 people, or by 500 who are not accredited investors, must register that class with the SEC and file reports.