AdvisorShares Announces Reverse Split of ETF

BETHESDA, Md., Aug. 30, 2024 /PRNewswire/ -- AdvisorShares, a leading sponsor of actively managed exchange-traded funds (ETFs), has announced a reverse split of the issued and outstanding shares of the AdvisorShares Psychedelics ETF. The split will not change the total value of a shareholder's investment.

Effective before market open on September 10, 2024, the Fund will affect a reverse split of its issued and outstanding shares as follows:

Please note the CUSIP changes, effective September 10, 2024:

As a result of this reverse split, every ten shares of the Fund will be exchanged for one share as indicated above. Accordingly, the total number of the issued and outstanding shares for the Fund will decrease by the approximate percentage indicated above. In addition, the per share net asset value (NAV) and next day's opening market price will be approximately ten times higher for the Fund. Shares of the Fund will begin trading on the NYSE Arca on a split-adjusted basis on September 10, 2024.

A shareholder's investment value will not be affected by the reverse split. The table below illustrates the effect of a hypothetical one-for-ten reverse split anticipated for the Fund, as applicable and described above:

1-for-10 Reverse Split

The Trust's transfer agent will notify the Depository Trust Company (DTC) of the reverse split and instruct DTC to adjust each shareholder's investment(s) accordingly. DTC is the registered owner of the Fund's shares and maintains a record of the Fund's record owners.

Redemption of Fractional Shares and Tax Consequences for the Reverse Split

As a result of the reverse split, a shareholder of the Fund's shares potentially could hold a fractional share. However, fractional shares cannot trade on the NYSE Arca. Thus, the Fund will redeem for cash a shareholder's fractional shares at the Fund's split-adjusted NAV as of the Effective Date. A shareholder could recognize a gain or loss in connection with the redemption of the shareholder's fractional shares.

"Odd Lot" Unit

As a result of the reverse split, the Fund may have outstanding one aggregation of less than 5,000 shares to make a creation unit, or an "odd lot unit." Thus, the Fund will provide one authorized participant with a one-time opportunity to redeem the odd lot unit after the split-adjusted NAV is struck on September 10. 2024.

About AdvisorShares

AdvisorShares is a leading provider of actively managed ETFs. For financial professionals and investors requesting more information, call 1-877-843-3831 or visitwww.advisorshares.com. Follow @AdvisorShares on X(Twitter) andLinkedIn for more insights.

Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, please call 1-877-843-3831or visit our website at www.advisorshares.com. Read the prospectus or summary prospectus carefully before investing.

Foreside Fund Services, LLC, distributor.

There is no guarantee that the Fund will achieve its investment objective. An investment in the Fund is subject to risk, including the possible loss of principal amount invested.

Psychedelic drugs, also known as hallucinogens, are a group of substances, including psilocybin, that are used to change and enhance sensory perceptions, thought processes, and energy levels. Psychedelic medicines, therapeutics, and healthcare treatments may be used in the treatment of illnesses such as depression, addiction, anxiety and post-traumatic stress disorder. Psychedelic medicine companies include life sciences companies having significant business activities in, or significant exposure to, the psychedelics industry including producers or distributors of psychedelic medicines, biotechnology companies engaged in research and development of psychedelic medicines, and companies that are part of the supply chain for psychedelics.

Psychedelics Companies Risk. Psychedelics companies are subject to various laws and regulations that may differ at the state/local and federal level. These laws and regulations may significantly affect a psychedelics company's ability to secure financing, impact the market for psychedelics and business sales and services, and set limitations on psychedelics use, production, transportation, and storage. There can be no guarantees that such approvals or administrative actions will happen or be favorable for psychedelics companies, and such actions may be subject to lengthy delays, and may require length and expensive clinical trials. Additionally, therapies containing controlled substances may generate public controversy. Political and social pressures and adverse publicity could lead to delays in approval of, and increased expenses for, companies and any future therapeutic candidates they may develop. All of these factors and others may prevent psychedelics companies from becoming profitable, which may materially affect the value of certain Fund investments. In addition, psychedelics are subject to the risks associated with the biotechnology and pharmaceutical industries.

In Canada, certain psychedelic drugs, including psilocybin, are classified as Schedule III drugs under the Controlled Drugs and Substances Act ("CDSA") and, as such, medical and recreational use is illegal under Canadian federal laws. In the United States, certain psychedelic drugs, including psilocybin, are classified as Schedule I drugs under the Controlled Substances Act ("CSA") and the Controlled Substances Import and Export Act (the "CSIEA") and, as such, medical and recreational use is illegal under the U.S. federal laws. There is no guarantee that psychedelic drugs or psychedelic-inspired drugs will ever be approved as medicines in either jurisdiction.

In the United States, scheduling determinations by the Drug Enforcement Agency ("DEA") are dependent on Food and Drug Administration ("FDA") approval of a substance or a specific formulation of a substance. Unless and until psilocybin, psilocin, or other psychedelics-based products receive FDA approval, such products may be prohibited from sale, which could limit the growth opportunities for certain portfolio companies of the Fund. Even if approved by the FDA, the manufacture, importation, exportation, domestic distribution, storage, sale, and legitimate use of such products will continue to be subject to a significant degree of regulation by the DEA.

Security prices of small cap companies may be more volatile than those of larger companies and therefore the Fund's share price may be more volatile than those of funds that invest a larger percentage of their assets in securities issued by larger-cap companies. These risks are even greater for micro-cap companies.

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SOURCE AdvisorShares