A bit more info from their website (important info about the ex-div date):
"QUESTIONS AND ANSWERS
Special Cash Dividend
(Updated July 7, 2016)
Preface
On July 6, 2016, EMCORE Corporation announced that its Board of Directors has declared a special cash
dividend of $1.50 per share of EMCORE common stock, payable July 29, 2016 to shareholders of record on
July 18, 2016. The aggregate dividend payment will total approximately $40 million based on the number of
shares of EMCORE common stock outstanding as of July 5, 2016.
Trading of EMCORE Common Stock
1. How will trading in EMCORE’s common stock be impacted by the dividend?
At $1.50 per share, the dividend declared by EMCORE’s Board of Directors represented approximately 26%
of EMCORE’s closing stock price on July 5, 2016. Pursuant to NASDAQ rules, when a dividend is declared
in a per share amount that exceeds 25% of a company’s stock price, the date on which that company’s shares
will begin to trade without the right to receive the dividend, or ex-dividend, is generally the first business day
following the payable date (rather than the second business day preceding the record date for cash distributions
representing less than 25% of the value of the common stock). NASDAQ has applied this rule and has
designated August 1, 2016, the first business day following the payable date for the dividend, as the exdividend
date. Shareholders who hold shares of EMCORE common stock at the close of business on the
record date will be entitled to receive the special cash dividend, but shares of EMCORE common stock will
trade with the entitlement to the dividend until the ex-dividend date. Therefore, if you own shares of
EMCORE common stock at the close of business on the record date and you sell those shares prior to
the ex-dividend date, you will not receive the special cash dividend.
Tax Treatment of Special Cash Dividend
1. What are the U.S. federal income tax consequences of the special cash dividend?
For U.S. federal income tax purposes, the distribution will be a dividend to the extent it is paid out of the
EMCORE’s current or accumulated earnings and profits, as determined under U.S. federal income tax
principles. Based on these rules, EMCORE currently estimates that 7% to 12% of the payment will be treated
as a dividend for tax purposes, with the balance treated as a nontaxable return of capital for U.S. federal
income tax purposes. This estimate is preliminary and subject to change based upon a comprehensive review
and analysis of EMCORE’s history as well as actual results for the entire 2016 taxable year.
An EMCORE shareholder’s tax basis in shares of EMCORE common stock will be reduced by the amount of
the distribution that is a return of capital. If the return of capital exceeds the shareholder’s tax basis in
EMCORE common stock, the remainder of the distribution in excess of the shareholder’s basis will be treated
as a capital gain. Shareholders are encouraged to consult their tax advisors to determine the tax treatment for
their particular shares.
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2. Does a return of capital distribution receive similar tax treatment for state income tax purposes?
Generally, yes, unless the state tax law specifically diverges. Again, shareholders are encouraged to consult
their tax advisors for the tax treatment in their state."
(they have a 2 page discussion)
EMKR
