Unless something changes on the final S-1, you will have had to have purchased your shares two days before the SEC effective statement. This is because it takes three days after you make a trade for it to be legally recorded (the "record date"). The S-1 says that the "record date" for the dividend will be the day after the SEC declares the S-1 Prospectus effective. Consequently, if the SEC effective statement is made next Tuesday, anyone who bought MCIG shares today (Friday) would get the VCIG dividend (only business days are counted). On the flip side, this would also mean that you could sell your MCIG shares on Monday and still get the dividend. In any event, if you buy MCIG shares for the dividend, you have to hold your breath the following business day and hope that the SEC doesn't issue their statement that day.
MCIG responded to the latest comments from the SEC regarding the S-1 on Thursday. Consequently, the SEC could issue the effective statement at any time or send MCIG more comments (they've already commented twice so I think it's unlikely they'll have to do so again). Once they issue the effective statement, the process is as follows:
What will be the pps of the IPO on VCIG?
It's important to distinguish between the IPO price, which is the value that will be attached per share to our dividend (and what we will report on our taxes as income) and the pps which VCIG will have when it opens for trading. The preliminary S1 lists the IPO price at no more than $.01/share however this could change on the final S1 (i.e. it could have been the subject of one of the SEC comments). The Investor Presentation shows an example of a VCIG pps of $.05 to show what MCIG would need the value of VCIG to be to up-list to a major exchange but it is only a guess by management of what VCIG's pps is likely to be (this was first published long before VCIG was available for sale so it could be out of date). The actual pps at which VCIG opens on the first day of trading is entirely dependent on supply and demand like any stock. The previous day's close will start out on that day as the IPO price but it could gap up or down like any stock depending on the bid and ask. If we have good sales numbers on VCIG by then we could see a big gap up and never see the IPO price again.
At IPO, will there be shares available for immediate purchase? Will our VCIG dividend shares be able to be traded immediately, or under some form of time hold? Will there be free trading shares above and beyond the dividend shares? Or ONLY the dividend shares?
It usually takes about 30 days after the XDATE for us to receive our shares. Also, VCIG can't arrange to trade on a market until after the effective statement is issued. There should be an announcement shortly after the effective statement about when we will receive our shares and when trading will start (usually the same date). It takes about 30 days for the transfer agent to confirm who is entitled to the dividend and distribute it. Once the shares are distributed. most brokerages require several days to post them to your portfolio. During that time you will be able to buy more shares but won't be able to sell any of your dividend shares.
Only the dividend shares paid to existing shareholders will be free trading, technically as of the effective statement. However, for all practical purposes, retail investors won't have the ability to trade them until they are made available by our brokerage some 30 days later. Keep in mind that market makers also own MCIG shares in their own account and will also receive VCIG shares as dividends. These will be the earliest shares available for trading when it opens.
Les
