1902 Splitting Up

Thursday, July 10, 2008

A note on the previous post - Jay was clean on everything tested, all the hepatitis variations, all the STDs, everything. The only surprise was that he had only one kidney, and a dried-up walnut where the other one should have been.

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The sisters are dividing up the late father-in-law's estate. One sister wanted to sell all the stock and distribute the cash. One sister wanted to distribute the shares, because the market is in the toilet. I don't know what the third sister wanted, but they decided to distribute shares.

There's really no difference, even if the market is so bad, because although it's a bad time to sell, it's also a good time to buy, so it doesn't make much difference to me. The one thing you don't want to do is sell and then just let the cash sit.

So anyway, I got the word that I'm to open an online brokerage account to receive my shares. I spent some time doing that today. (I don't like the brokerage they chose - I think their costs are too high, but I don't expect to be with them long.)

There's one thing that disturbs me about distributing shares. If the stock is sold and the proceeds distributed, then everyone gets the same. If, however, shares are distributed, there is a potential for inequity.

Depending on the history and future of the company, $1 worth of stock in company ABC can be of greater intrinsic value than $1 worth of stock in company XYZ. For example, there's a big difference between $1000 in Exxon (future recovery), and $1000 in Millennium Cell (possible bankruptcy).

I don't know how many different stocks they're looking at (having been ousted from the executor position I'm no longer privy to that information until the accounting), but I sent them a note suggesting that shares be distributed by count in any one company. Divide the number of shares by the number of portions, distribute to the parties proportionately, sell any remainder (a maximum of six shares in every case), and distribute the sales proceeds. That's fair, everybody gets exactly the same, and it heads off any later claims of inequity.

Mainly, I want to let them know that I will object to any division that leaves me with all the crap stocks, even if the current value is nominally the same. And I can't assume they already thought of that.
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