Cannabis Science Announces a Proposed 10:1 Ratio Structured Dividend Payout for a New Class of Common Shares to Shareholders of Record as of November 30, 2010
COLORADO SPRINGS, Colo., Nov. 2, 2010
Cannabis Science, Inc. (OTC Bulletin Board: CBIS), a pioneering US biotech company developing pharmaceutical cannabis products, is pleased to announce to its shareholders and the investment community that its Board of Directors have confirmed decisions and processes regarding the new class of common shares. The new class will initially be created by a proposed 1 for 10 new share dividend payment for shareholders of record as of the proposed record date of November 30, 2010.
The proposed structuring and implementation of the new class of common shares requires various state, SEC and FINRA filings and approvals. The Company will announce official filings and provide guidance as to target effective dates as it progresses through the process. The proposed structure is as follows: New Share Class
The Company's proposed new common share structure will include Class A as the new Class, and Class B will be the current outstanding trading common shares. Each Class of shares will have its own trading symbol and will contain the following features:
Class A Common Share Features (New class of common shares):
10 votes per shares
Convertible into Common Class B shares at a ratio of 30 for 1
Ratio participation of 9/10th (90%) on declared dividends
Unique trading symbol
Class B Common Share Features (Current class of common shares):
1 vote per share
Not convertible into other classes of shares
Ratio participation of 1/10th (10%) on declared dividends
Unique trading symbol
The price ratio conversion feature on the new Class A shares is to ensure the integrity of the share price ratio during market fluctuations between the new Class A and B common share classes, similar to that of Berkshire Hathaway's Class A and B common shares.
Dividend
Cannabis Science proposes to issue a special dividend to all shareholders of the current common Class B shares on the proposed record date of November 30, 2010, which will consist of shares in the new common Class A shares at the ratio of 1:10 for each common Class B share held.
In addition, the Board proposes to give each shareholder of record a share purchase warrant consisting of an option to purchase one additional share of the new common Class A share for each special dividend share received. Each warrant will be exercisable into one of the new common Class A shares at a price of $0.50 per share for a period of three - (3) months, expiring 90-days after all the proposed changes officially take effect.
For example, a Cannabis Science shareholder who owns 1,000,000 of the current common shares on November 30, 2010 will receive a special dividend of 100,000 shares of common Class A shares in Cannabis Science and 100,000 share purchase warrants, to purchase 100,000 additional Class A shares at a purchase price of $0.50 per share for a period of three - (3) months, expiring 90-days after all the proposed changes officially take effect. |
