<h4 id="h_01HGW8D7YJDDGTX4QEYTAHHHGV">What is a rights issue?</h4>
When a company issues rights, they’re offering existing shareholders an opportunity to buy newly issued shares in the company (usually at a discounted rate). The number of rights issued are proportionally based on each shareholder’s current shareholdings.  Rights can be either renounceable or non-renounceable. Investors with renounceable rights are able to exercise these rights, i.e. purchase the new shares, sell them on the market during the validity period or let the rights expire and not participate. Non-renounceable rights are issued by the company offering the shareholders the option to purchase additional shares of the company, usually at a price lower than the market price. The rights cannot be transferred to other brokers or sold in the market. If you wish to exercise rights that you received through a rights issue or bought on market, please contact the respective share registry before the applications close date. If you have any questions feel free to reach out to the customer support team <a href="https://hellostake.com/support/contact-us">here</a>.

Rights issues

A corporate action is an event carried out by a listed company that can impact its structure or investment value, therefore being relevant to its shareholders. Corporate actions are typically approved by the company's board of directors, but some may require the response of shareholders, where they may be permitted to vote. The most common type of corporate action events with trading are: 
<ul>
<li>Dividend/distribution payments </li>
<li>Dividend Reinvestment Plans (DRPs)</li>
<li><a href="https://hellostake.com/blog/stake-academy/stock-split">Stock splits</a></li>
<li>Stock consolidations/Reverse stock splits</li>
<li>Unmarketable parcel share sale facility</li>
<li>Mergers and acquisitions</li>
<li>Buy-backs</li>
<li>Rights issues </li>
</ul>
Stake will handle certain corporate actions on your behalf, such as dividends and stock splits. However, when you are required to do something or take an action in respect of a corporate action, you will need to liaise directly with the applicable share registry, proxy partner, or contact the Issuer directly.  It is recommended that investors approach such opportunities with caution and perform their due diligence before making an investment decision. Investors should also seek independent financial, legal and tax advice before proceeding. Stake may use reasonable endeavours to assist you, however we do not guarantee that this will be possible in all instances. If you have any questions feel free to reach out to the customer support team <a href="https://hellostake.com/support/contact-us">here</a>.

Corporate actions explained

<h3 id="h_01HGW8F7D6RYNF3S8V5AGC21JM">How do I receive dividends on Stake AUS?</h3>
You’re eligible for a dividend if you own a company’s shares through its ex-dividend date. The ex-dividend date occurs one business day before the company’s record date. If you purchase shares on or after the ex-dividend date,  you will not be entitled to the dividend.  Any dividends you are eligible to receive will be credited directly into your Stake AUD account, usually within 1-2 business days after the payment date. These payments are viewable in the ‘Transactions’ section of the app. After you create your Stake account, begin purchasing stocks or transfer shares to your new Stake HIN, you may receive correspondence from the share registry on behalf of the company you hold shares advising your bank details have been amended. Be sure to check the amended account details carefully, as these details should match your Stake AUS BSB and Account Number and represent your dividend destination account. If you would like to nominate an external bank account for your dividends to be received, you will need to contact the respective share registry. A share registry appointed by the company you are holding shares in to manage the payment of dividends, notices of company reports, and shareholder voting. Information on how to contact the share registry or amend your details can be found in the dividend payment communications you’ll receive from the company. It is usually one of the following registries:
<ul>
<li><a href="https://www.automicgroup.com.au/">Automic</a></li>
<li><a href="https://boardroomlimited.com.au/">Boardroom</a></li>
<li><a href="https://www.computershare.com/au">Computershare</a></li>
<li><a href="https://investorcentre.linkgroup.com/">Link Market Services</a></li>
</ul>
You can view all dividend payments in the App by going to More &gt; Funds and Balances, under Transactions. To only view dividend payments, use the filter and select Dividends. On the web, head to Menu &gt; Funds &amp; Balances &gt; Transactions. 
<h3 id="h_01HGW8F7D6JAW2FMB8K18ZGEH2">How do I receive dividends on Stake Wall St?</h3>
You’re eligible for a dividend if you own a company’s shares through its ex-divdend date (including fractional shares). The ex-dividend date of a stock is the day on which the stock begins trading without the subsequent dividend value. If you purchase shares on or after the ex-dividend date, you will not be entitled to the dividend.  Any dividends you are eligible to receive will be credited into your Stake USD account, usually within 1-2 business days after the payment date. These payments are viewable in the ‘Transactions’ section of the app. The dividend amount will be proportional to your holding. For example, if a company pays a dividend of US$10 per share and you hold 1.34 shares in that company, your dividend will be US$13.40 (minus any applicable withholding tax).  If your fractional share pays a dividend, the dividend payable to your position must be greater than or equal to $0.01 in order to be credited to your account.  
<h4 id="h_01HGW8F7D6KKKW1AR07KDJEE1J">Withholding tax</h4>
There is a 30% withholding tax on dividend payments in the U.S. This can be reduced to 15% after the completion of a W-8BEN form on U.S.-domiciled securities, which Stake arranges on your behalf when you make your first deposit on Stake Wall St. You can read more about W-8BEN forms <a href="https://hellostake.com/support/documents-and-statements/taxes-and-forms/26011219005337" target="_blank" rel="noopener noreferrer">here</a>. Some companies that pay dividends may have different withholding amounts. You can view all the relevant information by going to More &gt; Funds and Balances, under Transactions. Please note that due to the complexities involved with tax, we recommend you obtain independent &amp; professional advice which takes into account your own set of facts and circumstances. 
<h4 id="h_01HGW8F7D6TZYEY2KW8MPJ3YR2">Dividend Reinvestment Programs (DRIPs)</h4>
At this time, Stake doesn’t offer a dividend reinvestment program. However, thanks to fractional shares, you can manually reinvest your dividend cash payments back into the underlying stock or ETF (minimum trade size US$10).  
<h3 id="h_01HGW8F7D6F2WMVXT6W0K0246J">How do I track my dividends?</h3>
You can view all dividend payments by going to More &gt; Funds and Balances, under Transactions. To view only dividend payments, use the filter and select Dividends. A record of your dividends can also be found in Account &gt; Tax &amp; Documents &gt; Account Statements. 
<h4 id="h_01HGW8F7D6708Y5EX2CQZXF5GT">Dividend updates &amp; reversals</h4>
Sometimes a dividend rate is adjusted after shareholders have already been paid. This is particularly common with American Depositary Receipts (ADRs), with FX rates or changes in foreign tax rates and regulations (for example, due to a regulatory ruling).  In these circumstances, we’ll adjust your dividend payment: you’ll see a new payment that reflects the updated amount. In some extreme cases the entire dividend could be reversed, but this is rare.

Dividend process

At this time, Stake does not offer dividend reinvestment programs directly.
However, you can set one up through an affiliated share registry such as Computershare, Boardroom, Link Market Services or Automic Group.  Simply check which share registry your holdings are with and manage this through their online portal including their participation details. Please note that not all ASX-listed companies offer a dividend reinvestment plan.

Dividend reinvestment plan (DRP) for ASX

At this time, Stake doesn’t offer a dividend reinvestment program for U.S. stocks. However, thanks to fractional shares, you can use the cash received from the dividend distribution to then manually reinvest your dividend cash payments back into the underlying stock or ETF (minimum trade size US$10). 
<h3 id="h_01HGW8MKEH9YSGCQ6FM8H424J5">How do I track my dividends?</h3>
You can view all dividend payments by going to More &gt; Funds and Balances, under Transactions. To only view dividend payments, use the filter and select Dividends.  
A record of your dividends can also be found in Account &gt; Tax &amp; Documents &gt; Account Statements. 
<h4 id="h_01HGW8MKEHKH4ZVYCDQPFJJ2GM">Dividend updates &amp; reversals</h4>
Sometimes a dividend rate is adjusted after shareholders have already been paid. This is particularly common with American Depositary Receipts (ADRs), in relation to FX rates or changes in foreign tax rates and regulations (for example, due to a regulatory ruling).  In these circumstances, we’ll adjust your dividend payment: you’ll see a new payment that reflects the updated amount. In some extreme cases the entire dividend could be reversed, but this is rare. You can read more about dividends <a href="https://hellostake.com/blog/stake-academy/what-is-a-dividend">here.</a>

Dividend reinvestment plan (DRIP) on Wall St

<h4 id="h_01HGW6ZXME9J40BCT5Q5KGMQHS">How do I participate in a share purchase plan (SPP)?</h4>
If a company announces a share purchase plan to existing shareholders, you’ll be notified directly by the share registry of that company. It’s recommended you read through any announcements and review the share purchase plan so you can make an informed decision about engaging with the opportunity.  The offer document will typically contain details on how to participate in the share purchase plan, including an application form and payment details. If you have any questions feel free to reach out to the customer support team <a href="https://hellostake.com/support/contact-us">here</a>.

Share purchase plans (SPP)

<h4 id="h_01HGW8BG3Y87SEAT69CH8JWWKB">What happens when a company I own shares in undergoes a stock split?</h4>
A stock split is when a company divides existing shares of its stock into multiple new shares, which reduces the stock price while increasing liquidity. Investors will receive additional shares in proportion to their shareholdings at the time of the stock split and the ratio of the split.  For example, if you hold 100 shares of a company that announces a 4:1 stock split, your 100 shares will become 400 shares. The total value of those shares will remain the same and the company will retain its market capitalisation.  There are several reasons for a company to conduct a stock split, such as more accessibility and renewed interest as the price per share drops. You can read more about stock splits <a href="https://hellostake.com/blog/stake-academy/stock-split">here</a>.

Stock splits

<h4 id="h_01HGW873W3JYTDQGGP9DC3TZ7A">What happens when a company I own shares in undergoes a merger or an acquisition?</h4>
If you own shares in a company that is acquired by or merges with another company, you may receive a distribution (e.g. cash or shares) as part of the deal. As an investor, you’ll also have the opportunity to vote on factors that may impact the outcome of the deal. Every merger and acquisition has different terms and conditions. Ensure you read through the relevant announcements through the Stake app, exchange website or direct correspondence from the Share Registry/Company. The investor relations team of the company will be able to give you further information.

How can we help?

Rights issues

What is a rights issue?