Replies to post #86289 on KAT Exploration Inc (KATX)

[kagey1]

It does but the somewhat confusing thing is most stock distributions are in the same company so if they say do a 1 for 2 distribution of shares that are valued at $10 on the date of record of the distribution, the effective price of all the shares prior to the distribution is that figure and for every $20 in shares you have you get an additional share, which increases the float by 33% and sets the cost basis in your new shares at the $10 price less 33% or $6.67. The big question is how does it apply when the distribution is in a different company. My assumption is that in this case it would be at whatever the share price was set on the date of record, which would probably be the $0.70/share they are using.