Vitamin Cig (fka VCIG)

[lesgetrich]

In case anyone missed this on the MCIG site, here's a reprint. It seems our previous assumptions about the ex-dividend date (based on the record date being the day after the SEC effective statement according to the S-1) were mistaken. It now appears that the following applies...

I've found some more info on the FINRA site...

Methods for Determining Ex-Dividend Dates

Dividends Or Distributions 25 Percent Or Greater Than Security Value

The second method, under subparagraph (b)(2) of Rule 11140, provides that for dividends or distributions that are 25 percent or greater of the value of the subject security, the ex-date shall be the first business day following the payable date. For example, if an issuer has announced August 10 as the record date and August 31 as the payable date, then the ex-date will be September 1, the first business day after the payable date. In this example, September 1 is the day on or after which a buyer would purchase the security without the dividend and, therefore, the day on which the price of the stock is adjusted downward. In this example, a seller of the security on August 15, even though the holder of record to receive the dividend, would have to relinquish the dividend to the buyer. Indeed, because the value of the security on August 15 has not yet been adjusted downward to reflect the dividend distribution, the seller in this example would be unjustly enriched by keeping the dividend. The seller would have received the value of the dividend twice: first, as fully reflected in the unadjusted price of the stock on August 15; and secondly, as subsequently paid by the company to record date holders.

This Notice reminds member firms and their associated persons that ex-dates are determined differently, depending on the size of the distribution.

In other words, the dividend is attached to our shares on the record date but we must relinquish the dividend if we sell before the payable date (whenever the company distributes the shares to shareholders). Consequently, if I read this correctly, MCIG could set the payable date right before the VCIG shares start trading on the OTC. There would be little or no time for people to sell their MCIG shares and still get the dividend before VCIG starts trading. In other words, there will be little time for a selloff of MCIG before we see VCIG trading.