Define the following terms: (i) Level I ADRS

Level 1 ADR (unlisted, OTC traded/Pink Sheets) Level 1 ADR is the least expensive and lowest level to provide for issuance of shares in ADR form in the US. The company issuing ADRs has to comply with the SEC registration requirements but can be exempted from full SEC reporting requirements under certain circumstances. The company is not required to issue quarterly or annual reports in compliance with U.S. GAAP. These ADRs can only be traded over-the counter and cannot be listed on a national exchange in the US. The electronic OTC markets are also called pink sheets which is a centralized quotation service that collects and publishes market maker quotes for OTC securities in real time. This is the most convenient way for a foreign company to have its equity traded in the United States. Companies with shares trading under a Level 1 program may decide to upgrade their program to a Level 2 or Level 3 program for better exposure in the United States markets.