How an ADR Works and the Value for Companies & Investors

What is an ADR?

How an ADR Works

The Value of an ADR

Visibility and Information Distribution

• Creates greater visibility for the company with information easily accessible in the U.S. to financial data providers and media outlets
• Establishes clear information channels, providing U.S. investors easy access to company disclosure, which is made available in English

• Drives volume and liquidity in home market trading and creates efficient U.S. prices through cross-border broker connectivity and ADR convertibility
• Makes investing in global companies through U.S. broker-dealers and investment advisors easy for a large and diverse pool of investors, including institutional, managed, wrap and self-directed U.S. dollar accounts
• Increases access to investors for companies with a primary listing in smaller markets where investment firms and brokerages may not have representation

Investor Access

• Allows U.S. employees, customers and stakeholders to easily follow and invest in global companies
• Lowers complexity for investors through reputable counterparties — depositary bank and local custodians with strong credit ratings and competitive fees handle foreign ordinary shares custody, currency and tax issues
• Dividends paid and taxed in U.S. dollars with low cost U.S. clearing and settlement through DTC

ADRs on OTCQX, OTCQB and OTC Pink

1,500 ADRs are traded on the OTCQX, OTCQB and OTC Pink marketplaces. These global companies span 30 countries and 10 sectors. In the first quarter of 2014, $33.86 billion in dollar volume was traded in the ADRs on the three marketplaces, a quarter-on-quarter increase of 29% and a year-on-year increase of 53%.

The OTCM ADR Index powered by BNY Mellon (Bloomberg/Reuters: OTCDR; Thomson: DFCDR) provides investors with a benchmark for these global companies.

OTCQX ADRs are amongst the most actively traded ADRs on the OTCQX, OTCQB and OTC Pink marketplaces, accounting for 8% of the total number of ADRs while representing nearly 30% of the total ADR dollar volume traded on the three marketplaces. OTCQX ADRs include global companies that are distinguished by the high financial standards they meet to qualify for OTCQX, and the integrity of the information that they make available to investors.

The OTCQX ADR 30 Index (Bloomberg/Reuters: OTCQX30; Thomson: DGCQX) powered by BNY Mellon DR Indices is comprised of the top 30 OTCQX ADRs based on market capitalization, providing increased awareness of the high quality global companies trading on OTCQX.

A U.S. Investor Relations Strategy Using an ADR

To view our Investor Relations Best Practices Webinar: How To Improve Your U.S. IR Strategy Using an ADR and OTCQX, click here

To learn more about U.S. Investors Relations Best Practices, contact Corporate Services at +1.212.896.4420 or issuers@otcmarkets.com .