Bob Wenzel on the Lineage of the Cato Shares

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Writes Bob: A commenter brings up a point about the lineage of Cato shares:

“Bob — Follow the lineage of the original Cato shares. They create MANY unresolved questions. 1977 Original Shareholders Agreement: Charles Koch — 12 shares, George Pearson — 12 shares, Roger MacBride — 12 shares, Murray Rothbard — 12 shares, Ed Crane — 12 shares; TOTAL SHARES ACCOUNTED FOR: 60. 1985 Shareholders Agreement: Charles Koch — 16 shares, George Pearson — 16 shares, Bill Niskanen — 16 shares, Ed Crane — 16 shares; TOTAL SHARES ACCOUNTED FOR: 64; OUTSTANDING SHARES UNACCOUNTED FOR: 24. 1991 Shareholder’s Agreement: Charles Koch — 16 shares, George Pearson — 16 shares, Bill Niskanen — 16 shares, Ed Crane — 16 shares, David Koch — 16 shares; TOTAL SHARES ACCOUNTED FOR: 80; OUTSTANDING SHARES UNACCOUNTED FOR: 24. 2008: George Pearson relinquishes his stake in Cato by selling his shares to Cato. Charles Koch — 16 shares, Bill Niskanen — 16 shares, Ed Crane — 16 shares, David Koch — 16 shares; TOTAL SHARES ACCOUNTED FOR: 64; SHARES RETURNED TO CATO: 16; OUTSTANDING SHARES UNACCOUNTED FOR: 24.”

I am not trying to make the exact point as the commenter, but it is interesting that between the two agreements the Koch, Pearson, Niskanen, and Crane shares go up by 4 each, or a total of 16. Since MacBride, Rothbard had 12 each or a total of 24. It suggests that the MacBride shares were treated differently from Rothbard’s. If MacBride’s shares were “returned” first, it would suggest that Rothbard’s shares were divided up amongst the others. If Rothbard’s were “returned” first, it suggests that those shares are held by Cato itself and MacBride’s were split between the others.

If MacBride’s were returned first, it means that Murray’s shares were split up between  Koch, Pearson, and Crane, and that Murray should have received a check from each. If they took Murray’s shares first, Cato should have written a check to Murray.

2:40 pm on March 4, 2012