Stock Split FAQs

Stock Split FAQs

  • The decision to split the stock was made by Ledyard’s Board of Directors, based primarily upon a desire to place the market price of our stock in a more attractive price range for a more diverse group of investors in our local market. The split is consistent with the Board’s and management’s confidence in Ledyard’s continued growth.
  • Each shareholder of record as of September 4, 2017 will receive a dividend of two shares of Ledyard stock for each common share held. The dividend will be paid on September 20, 2017.

    Additionally, immediately after the stock split, each share will have a value that is one-third the value per share prior to the stock split. The market value of each shareholder’s holdings will remain the same. Here is an example:

    Assuming you own 100 shares of Ledyard stock on the record date and the market price is $60 per share, the total value of your holdings is $6,000. After the split, you will own 300 shares of Ledyard stock at a market price of $20 per share with the value of your shares remaining $6,000.
  • No. The stock split will not dilute the value of Ledyard stock. Each investor will have the same proportionate interest in Ledyard shares before and after the stock split.
  • No.
  • While individual shareholders should consult with their own tax advisor regarding their own specific tax circumstances, a stock split in the form of a stock dividend is generally not a taxable event for U.S. taxpayers.
  • The cost basis for each share owned immediately after the stock split is equal to one-third of what it was immediately before the split. For example, if you owned 100 shares of stock before the split with a cost basis of $15 per share for a total cost basis of $1,500, after the split, you would own 300 shares of stock with a cost basis of $5 per share for a total cost basis of $1,500. This summary of stock split tax consequences is not intended to be complete – please consult with your tax advisor for any questions you may have regarding the stock split or your shares.
  • In an effort to aid our shareholders in the safekeeping of their shares and to improve the timeliness of any transfer requests, the additional shares issued as a result of this split will be issued in “book entry” form, without stock certificates. Your new shares are being registered on the books of Broadridge, our transfer agent. After the split payment date you will receive a “book entry” statement from Broadridge showing the activity in your account as a result of the stock split. You will not receive a stock certificate unless you request it from Broadridge.

    Any stock certificates you may currently hold are still valid and should NOT be destroyed. Such certificates will continue to represent the same number of shares as shown on their face and should continue to be kept in a secure place.

    If you hold shares in a brokerage account, the additional shares will automatically be deposited to your brokerage account. Please contact your broker with any questions you may have.
  • In the future, the quarterly cash dividend will apply to both old (pre-split) and new (post-split) shares. The per share amount of the dividend, though, will be approximately one-third of its current level assuming the Board of Directors maintains the current level of dividends.

    For example, the next dividend payment will be on September 1st at a rate of $0.48 per share and will be paid based on the number of shares in your account on August 11, 2017. In the future, if a dividend is declared and there is no change to the current rate, the payout rate adjusted for the split would be $0.16 per share.
  • At the time of the split, the number of shares outstanding will be multiplied by three and the earnings per share will be divided by three.

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