Stock Split FAQs
No. This is Medidata Solutions’s first stock split
The stock split reflects the Board of Directors' continued confidence in the long-term growth and financial performance of our Company. A stock split is also expected to make the price of the Company’s stock more affordable and potentially more attractive to new investors
A two-for-one split means that one additional share of stock is issued for each share in existence prior to the split. After the split, each share is worth one-half of what it was worth immediately prior to the split.
Let’s assume that as of the Record Date (December 2, 2013) an investor owns 100 shares of Medidata Solutions common stock and let’s also assume that the market price of Medidata Solutions stock is $100 per share, so the investment in Medidata Solutions is worth $10,000. Let’s also assume that the stock price doesn’t move up or down between the record date and the time the split actually takes place. Immediately after the split, the investor would own 200 shares of Medidata Solutions stock, but the market price would be $50 per share. The investor’s total investment value in Medidata Solutions would remain the same at $10,000 until the stock price moves up or down.
There are several key dates:
The Record Date is on December 2, 2013. This is the date used to determine which stockholders are entitled to receive additional shares due to the split.
The Split Date is on December 16, 2013. This is the date when shares issued as a result of the stock split are expected to be distributed by our transfer agent to our stockholders
The Ex Date is on December 17, 2013. This is the date on which the trading price of our stock on Nasdaq is adjusted to reflect the split.
We are advised that the issuance of shares in this stock split is not a taxable event for U.S. Federal income tax purposes (under sections 305(a) and 307(a) of the Internal Revenue Code). The tax basis in each existing share you currently own should be divided equally between that share and the new share received with respect to that share in the stock split, so that following the stock split each share then owned will have a tax basis equal to one-half of the tax basis of a share held prior to the stock split. For example, if you owned 100 shares before the split with a tax basis of $100 per share, after the split you would own 200 shares of stock with a tax basis of $50 per share. We recommend that shareholders consult with their own tax advisor regarding all of the tax consequences resulting from the stock split. Foreign residents should consult their local tax advisors.
No, if you hold a certificate, there is no action that you need to take. The additional split shares will be added in book entry to a American Stock Transfer and Trust account in your name. You will receive a statement from American Stock Transfer and Trust reflecting your book-entry holdings which will be sent following the distribution date on December 16, 2013. You can also access your account on-line at www.amstock.com
If you are a record holder and have questions about the stock split, shareowner records, stock transfers, stock certificates or other stock-related inquiries please contact:
American Stock Transfer and Trust
Attn: Shareholder Services
6201 15th Avenue
Brooklyn, NY 11219
Visit website: www.amstock.com
Send email to: email@example.com
If your Medidata Solutions shares are held in a brokerage account, they split automatically on the split date. You don’t need to do anything.
When the stock splits on a two-for-one basis, the number of shares outstanding doubles. Earnings per share are one half of what they otherwise would have been as the net earnings are divided by two times as many shares.
No, the stock split will not change your proportionate ownership interest in the Company.
Please click here to view IRS Form 8937
Please submit your question using the form below.