Dividend Reinvestment Plan Terms

This page is a supplement to the full Conditions of Use provided here.

Last Updated: October 2, 2023

Block Transfer is not a registered broker-dealer under the Exchange Act or any similar legislation in foreign jurisdictions. As such, we cannot effect securities reinvestments on your behalf.

Optional Matching

If you chose to match any part of a company's dividend, we will increase the amount of the automatic purchase transaction by the percentage specified by you, the difference paid for with excess cash in your account.

Insufficient Funds

If your account lacks sufficient funds to fully satisfy the elected dividend match percentage at the time of the reinvestment transaction, the order shall revert to reinvesting only the original dividend sum.

Backup Witholding

In circumstances where withholding taxes are applicable, we shall deduct the requisite amount from your gross dividends. Consequently, the dividends reinvested on your behalf or the proceeds disbursed to you will be net of such taxes.

Tax Considerations and Implications

We will not adjust dividend reinvestment amounts for any potential dividend income taxes you likely must pay at the end of the year.

This information is predicated upon current legislation and is subject to modifications by future legislative enactments, judgments by the Internal Revenue Service, regulatory changes, and court decisions.

While the Internal Revenue Service has previously issued private letter rulings that touch upon the treatment of dividend reinvestment plans, such rulings are not universally applicable. They are case-specific and not intended to serve as legal precedent.

This disclosure does not capture all the tax implications that may be relevant to all types of investors and does not cover tax considerations under state, local, or foreign laws. You should consult your own tax advisor for a tailored understanding of your specific tax liabilities and obligations.

Still Taxable

In general, the amount of cash dividends paid by our issuers will be includable in your income even though reinvested. Therefore, these dividends constitute taxable income, even if reinvested to acquire additional shares. The taxable amount is equivalent to the fair market value of the securities purchased, whether sourced from the issuing company or acquired through market transactions.

Excess Reinvestment Value

If you choose to make optional matching investments, you will be considered to have received an additional dividend distribution equivalent to the surplus, if any, of the fair market value of the shares obtained through a Direct Stock Purchase Plan on the matching date over your actual cash investment.

Your Basis

The cost basis for tax treatment of shares acquired through the reinvestment of dividends will generally equate to the fair market value of the shares at the time of acquisition. For shares bought with optional matching investments, the tax basis will equal the amount invested, augmented by any additional deemed dividend arising from a waiver or discount, if such options are provided by the issuer. The period of holding for tax purposes commences on the date the shares are credited to your account.

Reinvestment Process

When you receive a cash dividend, you will get a notification to open our app and automatically purchase new shares using your proceeds and, if electing a reinvestment match, additional cash as avaliable. These private share purchases execute against existing liquidity in the SDEX.

Automatic Reinvestment

You consent that these purchases will execute automatically the next time you open the app. You grant your express written affidavit that you are initiating and effecting each such purchase willingly and on your own behalf when your access device submits a reinvestment order.

Risk Factors

These risk factors apply to dividends reinvested through the SDEX. We cannot be held liable for differences in reinvestment execution price between the SDEX and an NMS venue, defined by reference.

We reserve the right to minimize this particular risk by asking clients to post sale offers sufficient to cover expected reinvestment purchases at an average price reasonably determined by us.