This disclosure is an addendum to your Customer Account Agreement and describes the terms, risks, and limitations of purchasing and selling fractional interests of certain securities (“Fractional Shares”) through Ram Financial LLC (“Ram Financial”) and Apex Clearing Corporation (“Apex Clearing”). In the case of conflict with the Customer Account Agreement, this disclosure controls. By trading Fractional Shares, you agree that Ram Financial and Apex Clearing shall not be held liable for risks disclosed herein, including risks in connection with the execution, handling, purchasing, and selling of Fractional Shares.
Orders and Eligible Securities
Not all securities are eligible for Fractional Share trading. Fractional Share trading is available only for certain equities and ETFs as determined by Apex Clearing based on market capitalization, volume, liquidity, and volatility. Ram Financial reserves the right to limit available securities at any time. Ram Financial will not accept Fractional Share purchase orders of less than $5.00 or sell orders of less than $1.00. Only market orders are accepted for Fractional Shares — limit orders are not permitted. Fractional Share orders may only be placed during regular market hours (9:30 a.m. – 4:00 p.m. Eastern). The actual amount of an executed order may be higher or lower than the amount requested.
Execution
Apex Clearing administers the purchase, sale, and holding of Fractional Shares. For the Fractional Share component of any transaction, Apex Clearing (or an affiliate) generally acts as principal or riskless principal. Apex Clearing executes Fractional Share orders at the price it receives in the market by rounding up to the next whole share, executing the whole share order, and allocating the fractional portion to your account. As a result, buy orders may appear as principal trades and sell orders may appear as short sales on your trade confirmations.
Rounding, Dividends, and Corporate Actions
Apex Clearing rounds Fractional Share holdings to the fifth decimal place and rounds values and dividends to the nearest $0.01. This may affect your ability to be credited for dividends and stock splits. You will receive dividend payments on Fractional Shares on the same terms as whole shares (rounded to the nearest $0.01) and will participate in stock splits, mergers, and other mandatory corporate actions. However, you will not be able to make voluntary elections on corporate actions — including tender offers and rights offerings — with respect to Fractional Shares, and Apex Clearing cannot provide shareholder documentation for holdings of less than one share.
Liquidity and Transferability
Fractional Shares are unmarketable and illiquid outside of the Aries platform and cannot be transferred in-kind to another brokerage. If you transfer your account via ACATS, whole shares will transfer in-kind and Fractional Shares will be liquidated, with cash proceeds transferred to your new brokerage. This liquidation may result in tax consequences.
Voting
You may vote your Fractional Shares. Apex Clearing will aggregate proxy votes for Fractional Shares of Ram Financial customers and report them to the issuer or its designated vote tabulator. However, the issuer or vote tabulator may not fully count such votes.