8-K: Therapeutic Solutions International Clarifies Loyalty Dividend Process Amidst Broker Confusion

Therapeutic Solutions International is addressing confusion surrounding its elective loyalty dividend of Campbell Neurosciences shares, urging shareholders to contact their brokers to ensure proper election by the August 14, 2024 deadline.

Summary

• Therapeutic Solutions International (TSOI) is distributing a loyalty dividend of up to 10 million shares of its subsidiary, Campbell Neurosciences, Inc. (CNSI), to eligible TSOI shareholders.
• The dividend is elective, meaning shareholders must affirmatively choose to receive it.
• Eligible shareholders are those who beneficially owned TSOI common stock on or before May 15, 2024.
• The distribution ratio is 0.0022 shares of CNSI for each one share of TSOI owned as of April 30, 2024.
• The offer remains open for 90 days from the May 15, 2024 record date, with a deadline of August 14, 2024.
• TSOI had initially filed for this dividend on March 27, 2023, but withdrew it due to staleness on March 12, 2024, and refiled on May 3, 2024.
• FINRA declined to publicly announce the dividend because it is elective, requiring TSOI to work directly with its transfer agent and the Depository Trust Company (DTC).
• TSOI notified brokers through the DTC's LENS system on May 16, 2024, and sent notices to broker addresses provided by the DTC.
• Shareholders must submit an Election Form through their broker to the Disbursement Agent (DA), who is also the Transfer Agent (TA) for both TSOI and CNSI.
• The Election Form requires beneficial holder information, number of TSOI shares held, date acquired, and confirmation of acceptance of the dividend offer.

Sentiment

Score: 6

Explanation: The document is neutral to slightly positive. While it addresses confusion and clarifies the dividend process, the need for such clarification and the non-standard nature of the distribution process introduce some uncertainty.

Positives

• TSOI is providing a loyalty dividend to its shareholders in the form of CNSI shares.
• The company has taken steps to address confusion regarding the elective dividend process.
• TSOI has provided clear instructions and documentation to brokers to facilitate the dividend distribution.

Negatives

• There has been confusion among shareholders and brokers regarding the elective dividend process.
• The dividend distribution process is not automated and requires manual intervention by brokers and shareholders.
• FINRA's decision not to announce the dividend publicly has added complexity to the distribution process.

Risks

• Shareholders may miss the August 14, 2024 deadline to elect to receive the dividend due to confusion or lack of awareness.
• The manual process for dividend distribution may lead to errors or delays.
• The company's reliance on brokers to communicate with shareholders may result in uneven distribution of information.

Future Outlook

The company expects the dividend distribution to be completed by the August 14, 2024 deadline, provided shareholders and brokers follow the outlined procedures.

Management Comments

• The company is addressing confusion regarding the elective loyalty dividend and the procedures for receiving them.
• The company recommends shareholders contact their broker-dealers to ensure they receive the dividend.
• The company has provided clear instructions and documentation to brokers to facilitate the dividend distribution.

Industry Context

The use of elective dividends is not standard practice, which has led to confusion and the need for specific communication with brokers and shareholders. This situation highlights the complexities of distributing non-standard corporate actions.

Comparison to Industry Standards

• Standard dividend distributions are typically automated through FINRA and the DTC, unlike this elective dividend which requires manual processing.
• The need for direct communication with brokers and the use of the LENS system is not typical for most dividend distributions.
• The delay in FINRA's guidance on the methodology for this type of elective dividend is unusual compared to standard corporate action processing.

Stakeholder Impact

• Shareholders are impacted by the need to actively elect to receive the dividend and follow specific procedures.
• Broker-dealers are impacted by the need to process the Election Forms and communicate with shareholders.
• The company is impacted by the need to manage the non-standard dividend distribution process.

Next Steps

• Shareholders need to contact their broker-dealers to confirm their eligibility and submit the Election Form.
• Brokers need to process the Election Forms and submit them to the Disbursement Agent/Transfer Agent.
• The Disbursement Agent/Transfer Agent will process the elections and distribute the CNSI shares.

Key Dates

Keywords

loyalty dividend, Therapeutic Solutions International, Campbell Neurosciences, CNSI, shareholders, elective dividend, broker-dealer, FINRA, DTC, LENS, Disbursement Agent, Transfer Agent