Thread by @WildRhino

#IntoTheDD
#CustoAndFlow

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Custodianships are one of the hottest plays right now. Why? People love the potential when it comes to reverse mergers.

But what are custodianships? I'll provide an overview in this thread.

REMINDER: The process differs based on state law.

#CustoAndFlow

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A person, or business, may seek custodianship over a shell.

We call a ticker a shell when the associated public company is abandoned and State annual reports have not been filed in years.

The Secretary of State reports the status as Revoked or Inactive.

#CustoAndFlow

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A petition for custodianship is filed with the courts to initiate the process.

Some of the information required in the petition is:
* Company is inactive.
* Applicant's evidence of attempted contact with officers.
* Applicant is a shareholder

#CustoAndFlow

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Once custodianship is granted, the new officer will often follow the high-level steps below. We'll go over each one.

1. Reinstatement
2. Filings
3. Attorney Letter / Audited
4. Pink Current
5. Prep Ticker for Merger
6. Find Merging Candidate

#CustoAndFlow

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1. Reinstatement--

A business has several requirements before reaching "Good Standing" status in their state:
1. Apply for reinstatement.
2. Pay reinstatement fee and a fee for each annual report missed.
3. Cure delinquent taxes.

#CustoAndFlow

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2. Filings--

You know the process, a publicly traded company must remain financially compliant in order to remain in the "Pink Current" tier.

The new officer will file, at most, the last 2 year's worth of Quarterly and Annual Reports.

#CustoAndFlow

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3. Attorney Letter / Audited--
In order to achieve Pink Current status, one of the following must be met:
* Have reports audited by a PCAOB auditing firm.
* File an Attorney Letter

4. Pink Current--
Once processed, the ticker will move to "Pink Current."

#CustoAndFlow

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5. Prep Ticker for Merger--

There are no specific steps for this, but a custodian may:
* Reduce the authorized shares.
* Retire shares.
* Cancel outstanding debt.
* Work with convertible note holders.

#CustoAndFlow

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6. Find Merging Candidate--

Find a private business looking to go public!

Did I miss something or make a mistake? Please let me know.