Rent-a-Wreck Windfall
A long while back, I heard about DRIP programs as an investment method. The basic idea is that if you own at least one share of a stock in a certificate form, you can buy more stock directly from the company while avoiding paying the normal broker commision. A few companies even will give you a discount on the stock program. The main problem is getting that first share in certificate form since it is virtually always held by the broker. Why? Because its cheaper for the broker to keep the certificate themselves and hold onto it for you, than having mailed to you. Plus you have to worry about possibly losing it or mailing it when you want to sell or a merger occurs…etc. Also to get a stock certificate in your name ussually requires a nice fee to your broker in the neighborhood of $35 – $50 a pop. So while I was researching about it, I came across Oneshare.com that specializes in selling one share of stock in certificate form. While it can be used for the purposes of a DRIP program, there are other cheaper alternatives to use since Oneshare is more along the idea of giving the share of stock as a gift.
I ended up signing up for their newsletter, which come to think of it, I don’t think I’ve recieved in a while. But anywho, they would give away a free share in a company, ussually a penny stock each month to several newsletter subscribers. As you might have guessed, I did eventually win one in Rent-a-Wreck. Its no longer traded on a traditional market such as the Nasdaq or NSYE, but is handled by the American Stock Transfer & Trust. I did decline Oneshare’s nice offer to buy a pretty frame for my share.
After I recieved the certificate, I admired it for a moment, put it in a safe spot and promptly pretty much forgot about it. The company did send the occasional communication such as when they delisted their stock or when they promised to work really hard to turn the company around. But glancing at the financial reports for the company, it didn’t seem like the company was going to sky-rocket to $80 or anything. The stock is mostly controlled by the CEO, and it more seems like an extra way to make a few bucks for them than anything, so I did not really worry about it. I was content to let the certificate sit tucked away for all enternity. A few months ago, the company sent a notice that the company was being brought out in a merger with some company I’ve never heard of called San Diego Car Rentals, but that deal fell through with lots of finger-pointing and name-calling from the looks of the notice I recieved.
Apparently the company managed to find another suitor called MBFG, Inc., which is owned by a company called J.J.F Management Services Inc, which has 10 Budget and 14 Nextcar rental locations. They said they had over $600 million in revenue in 2005, so they do have that going for them. So what does that mean for me? My share is entilted to a cash payment of $0.40.
Subtract the cost of a stamp to mail back the certificate, you wind up with the great fortune of $0.40 – $0.39 = $0.01.
Yep, I better remember to include my social security number on the back of the form so I can pay all the proper taxes on my shiny penny. I wonder if it even matters if I didn’t bother to send the form and the certificate back in. While I would not recieve my whopping payment, I also would not have to fill out the forms, mail them, listen to the bank teller snicker when I cash the check, etc. But I guess I’ll just bite the bullet and do it just so they’ll be done and forgotten about.
I’ll be sure not to spend my windfall all in once place though…
Update: I did in fact receive the check a few weeks later. I put it on my desk somewhere and promptly misplaced it. One of these days I’m sure I’ll come across it, but no big loss.