Harborside Inc. (“Harborside” or the “Company”) (CSE: HBOR) (OTCQX: HBORF) a California-focused, vertically integrated cannabis enterprise, today announced that, subject to shareholder approval, it intends to amend its articles (the “Amendment”) to remove conversion restrictions placed on the Company’s multiple voting shares (“MVS”). The Company anticipates that this change will eventually result in more than 50% of the Company’s issued and outstanding subordinate voting shares (“SVS”) being directly or indirectly owned by shareholders of record domiciled in the United States (“U.S.”), which will have the effect of the Company no longer meeting the definition of “foreign private issuer” under U.S. securities laws and the Company will be required to register under the Securities Exchange Act of 1934, as amended (the “Transition”).
If and when the Transition is completed, the Company will be subject to the U.S. Securities and Exchange Commission’s (“SEC”) reporting requirements applicable to U.S. domestic companies. The SEC’s reporting requirements will require, among other things, Harborside’s financial statements and financial data to be presented under U.S. GAAP. The Company expects to seek shareholder approval for the Amendment by the end of the 2021 calendar year and has established a task force of internal and external resources to manage the Transition.
Although the Company will become a U.S. registrant with the SEC, it will continue to be an Ontario corporation. Harborside’s shareholders will not be required to take any action as a result of the Company’s Transition, if and when the Transition is approved and completed, other than officers, directors, and holders of 5% or more of the Company’s shares of SVS. Harborside’s SVS will continue to be listed on the Canadian Securities Exchange (“CSE”) under the symbol “HBOR” and on the OTCQX Best Market under the symbol “HBORF”.