Mandatory Corporate Actions

Mandatory corporate actions are automatically applied to the investments involved while voluntary corporate actions require an investor's response to be applied. No action is required or taken by the investor on a mandatory corporate action. A great article including helpful information on mandatory corporate actions can be found here on the Investopedia web site. 

Below is a list of mandatory corporate actions and definitions:

Cash dividend - a distribution of a company's earnings announced by the Board of Directors to its shareholders, payable in cash. See here a link to IBM's press release announcing a recent dividend payment.

Stock splits - the number of outstanding shares is increased by a specified multiple, while the share price is decreased by the same factor as the multiple. For example, in a 2-for-1 split the investor's share amount will double. If they held 100 shares at $50 per pre-split they will own 200 shares at $25 after the split is effective.

Merger - mergers combine two separate businesses into a single new legal entity. The investors as of merger effective date may receive stock of the new company only (stock merger), cash at a specified rate (cash merger), or both stock and cash in exchange for their originally held shares of the old company.

Company name change - when a company changes its name, and the stock also usually begins trading under a new ticker symbol. The investors receive a share of the new company name versus the old on a 1-for-1 basis.

Reverse split - A reverse stock split is a type of corporate action that consolidates the number of existing shares of stock into fewer (higher-priced) shares. A reverse stock split does not directly impact a company's value (only its stock price). It can signal a company in distress since it raises the value of otherwise low-priced shares.

Repayment of bond - from Investopedia - Fixed-income investors in low-interest-rate environments often discover that the higher rate they receive from their current bonds and CDs doesn't last until maturity. In many cases, they will receive a notice from their issuers stating that their principal is going to be refunded at a specific date in the future. Bonds that have call features provide this right to issuers of fixed-income instruments as a measure of protection against a drop in interest rates.