Cannabis Science Receives FINRA Communications and Provides Updated Corporate Guidance on Proposed Dividend and Warrants for the New Class of Common Shares Payable to Shareholders of Record
COLORADO SPRINGS, Colo., Nov. 30, 2010 /PRNewswire-FirstCall/ -- Cannabis Science, Inc. (OTC Bulletin Board: CBIS), a pioneering US biotech company developing pharmaceutical cannabis products, is pleased to update its shareholders and the investment community with guidance on its planned new class of shares, dividend and warrants.
Cannabis Science has received communication from the FINRA regarding the proposed changes in the company share structure and is complying with FINRA guidance and protocols for reporting and regulatory filings, and is in the process of providing the required documentation for SEC/FINRA approvals of the Company's proposed actions. Cannabis Science's Board of Directors confirms it will change the shareholder record date to accommodate the SEC and FINRA required filings and the required approval from the SEC/FINRA, as the Company works through the structuring and implementation of the new class of common shares.
The Board confirms its decisions and commitments regarding the new class of common shares and proposed dividend. The Company has proposed a new class of common shares to be initially created by a proposed 1 for 10 new common share dividend to be distributed to shareholders of record as of a new proposed record date of December 31, 2010. The Company will announce official filings and provide guidance as to target effective dates as it progresses through the process and receives regulatory approvals from SEC/FINRA.
The proposed new share structure and dividend payments are as follows:
New Share Structure
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.
Cannabis Science proposes to issue a special dividend to all shareholders of the current common Class B shares on the proposed record date of December 31, 2010, which will consist of a dividend 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 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 months, expiring 90-days after all the proposed changes officially take effect.
About Cannabis Science, Inc.
Cannabis Science, Inc. is at the forefront of pharmaceutical grade medical marijuana research and development. The Company works with world authorities on phytocannabinoid science targeting critical illnesses, and adheres to scientific methodologies to develop, produce and commercialize phytocannabinoid-based pharmaceutical products. In sum, we are dedicated to the creation of cannabis-based medicines, both with and without psychoactive properties, to treat disease and the symptoms of disease, as well as for general health maintenance.
Forward Looking Statements; This Press Release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. A statement containing works such as "anticipate," "seek," intend," "believe," "plan," "estimate," "expect," "project," "plan," or similar phrases may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Some or all of the events or results anticipated by these forward-looking statements may not occur. Factors that could cause or contribute to such differences include the future U.S. and global economies, the impact of competition, and the Company's reliance on existing regulations regarding the use and development of cannabis-based drugs. Cannabis Science, Inc. does not undertake any duty nor does it intend to update the results of these forward-looking statements.
SOURCE Cannabis Science, Inc.