Notaries

Notaries

As anyone who has ever tried to decipher a license agreement or file a patent claim knows, legal documents can be quite hard to read – to the point of being confusing to those unfamiliar with the jargon or specific wording and language. In Quebec, a professional order, the Chambre des notaires du Québec regulates the notarial profession. For example, practicing professionals must send in reports to the chamber every month regarding last wills and inaptitude mandates, regardless of whether they have certified any.

Further, notaries possess in trust accounts, where funds from customers are collected, only to be used to complete transactions and pay fees, since it is the notary’s responsibility to make sure that there are no outstanding mortgages, loans and hypothecs (aside from new financing or refinancing) unpaid on the property.

Thus, to obtain final acquittances, the notary pays off any hypothecs to be radiated, as well as school and municipal taxes, and condo fees if there are any (required from all co-owners in a condominium). Once the transaction is complete, the adjustments at times result in moneys being prorated and given back to the party who otherwise would en up overpaying the bill(s). School commissions and the city refrain from issuing revised bills for novel homeowners. Also, the notary customarily produces a statement of Adjustments and Disbursements to show clients exactly how their funds were used and the proration calculation. Interestingly, in the digital era notaries publish online and supporting and related papers, as well as invoices, can be drafted using notarial software such as Pro-Cardex.

She decided to issue a formal denial through a public notary in the city, but by then it was too late. Nobody believed her. (Mario Gonzalez). First things, first! future notaries. Photo by Elena

Additionally, all notaries’ contracts have minutes. Thus, a mention on a contract stating ‘under minute number SIX THOUSAND TWO HUNDRED FIVE (6 205) of the original minutes of the undersigned Notary’ means this particular notary has processed six thousand two hundred five contracts. Moreover, a notary remains in possession of all contract originals, which even postmortem are transferred to the Court, while clients and partners receive certified copies. A true or certified copy of the original must contain the notary’s seal, an inversed title page, a stamp or notice with a descriptive statement and, of course, the notary’s signature. Amazingly, these steps transform a simple piece of paper into a document guaranteeing ownership rights to properties, financing agreements and resolutions.

In such tasks, the professional title holders are helped by paralegals and legal assistants. The correlated industry harbors its own job board, such as ParalegalJobs, and recruitment agencies such as Montpetit Group, while related programs are available at many colleges, whereas certain prelaw and graduate paralegal degrees are offered through universities.

Although notaries make decent salaries and many run their own businesses, notaries may actually lose money on certain files just to keep demand high. Of course, business practice varies from one notary to another. The best developmental avenues for notaries and notary firms seem to be solid networking and partnerships, particularly with banking institutions, mortgage and real estate brokers, and contractors.

Virtue of Merger

Virtue of Merger

Suppose we have two companies – the Able Circuit Smasher Company, an electronics firm, and Baker Typewriter Company, which makes typewriters. Each has 200,000 shares outstanding. It’s 1965 and both companies have earning of $1 million a year, or $5 per share.. Let’s assume neither business is growing and that, with or without merger activity, earnings would just continue along at the same level.

The two firms sell at different prices, however. Since Able Circuit Smasher Company is in the electronic business, the marker awards it a price-earnings multiple of 20, which, multiplied by its $5 earnings per share, gives it a market price of $100. Baker Typewriter Company, in a less glamorous business, has its earning multiplied at only 10 tomes and, consequently, its $5 per share earnings command a market price of only $50.

The management of Able Circuit would like to become a conglomerate. It offers to absorb Baker by swapping stock at the rate of two for three. The holders of Baker shares would get two shares of Able stock – which have a market value of $200 – for every three shares of Baker stock – with a total market value of $150. Clearly this is a tempting proposal, and the stockholders of Baker are likely to accept cheerfully. The merger is approved.

We have a budding conglomeratte, newly named Synergon, Inc. which now has 333,333 shares outstanding and total earnings of $2 million to put against them, or $6 per share (there are 200, 000 original shares of Able plus an extra 133,333, which printed up to exchange for Baker’s 200, 000 shares according to the terms of the merger. Thus, by 1966 when the merger has been completed, we find that earnings have risen by 20 percent, from $5 to $6, and this growth seems to justify Able’s former price-earnings multiple of 20.

Virtue of merger. Photo by Elena

Consequently, the shares of Synergon (née Able) rise from $100 to $120, everybody’s judgement is confirmed, and all go home rich and happy. In addition, the shareholders of Baker who were bought out need not pay any taxes on their profits until they sell their shares of the combined company.

A year later, Synergon finds Charlie Company, which earns $10 per share or $1 million with 100,000 shares outstanding. Charlie Company is in the relatively risky military-hardware business so its shares command a multiple of only 10 and sell at $100. Synergon offers to absorb Charlie Company on a share-for-share exchange basis. Charlie’s shareholders are delighted to exchange their $100 shares for the conglomerate’s $120 shares. By the end of 1967, the combined company has earnings of $3 million, shares outstanding of 433,333, and earnings per share of $6.92.

Here we have a case where the conglomerate has literally manufactured growth. Neither Able, Baker, nor Charlie was growing at all. Yet simply by virtue of the fact of their merger, the unwary investor who may finger his toock guide to see the past record of our coglomerate will find the following figures of earnings per share – $5.00 in 1965, $6.00 in 1966 and $6.92 in 1967.

Clearly, Synergon is a growth stock and its record of extraordinary performance appears to have earned it a high growth.

The trick that makes the game work is the ability of the electronic company to swap its high-multiple stock for the stock of another company with a lower multiple. The typewriter company can only “sell” its earnings at a multiple of 10. But when these earnings are packaged with the electronics company, the total earnings (including those from selling typewriter) could be sold at a multiple of 20. And the more acquisitions Synergon could make, the faster earnings per share would grow and thus the more attractive the stock would look to justify its high multiple.

The whole thing was like a chain letter – no one would get hurt as long as the growth of acquisition proceeded exponentially. Of course the process could not continue for long, but the possibilities were mind-boggling for those who got in at the start. It seems difficult to believe that Wall Street professionals could be so myopic as to fall for the conglomerate con game, but accept if they did for a period of several years. Or perhaps as subscribers to the castle-in-the-year theory, they only believed that other people would fall for it.

The story of Synergon describes the standard conglomerate earnings “grows” gambit. There were a lot of other monkey-shines practiced. Convertible bonds (or convertible preferred stocks) were often used as a substitute for shares in paying for acquisitions. A convertible bond is an IOU of the company, paying a fixed interest rate, that is convertible at the option of the holder into shares of the firm’s common stock. As long as the earnings of the newly acquired subsidiary were greater than the relatively low interest rate that was placed on the convertible bond, it was possible to show even more sharply rising earnings per share than those in the previous illustration. This is because no new common stocks at all had to be issued to consummate the merger, and thus the combined earnings could be divided by a smaller number of shares.

Sources: Burton G. Malkiel. A Random Walk Down Wall Street, including a life-cycle guide to personal investing. First edition, 1973, by W.W. Norton and company, Inc.

Old Timer's Game

Old Timer’s Game

By Ben Bova

It all started with my left knee – he said. The big three-oh.

I’d been catching for the A’s for four years, hitting good enough to always be fifth or sixth in the batting order, but the knee was slowing me up so bad the Skipper was shaking his head every time he looked my way.

We were playing an ineterleague game against the Phillies. You know what roughnecks they are. In the sixth inning they got men on first and third, and their batter pops a fly to short right field. Runner on third tags up, I block the plate. When he slammed into me I felt the knee pop. Hurt like hell – I mean heck – but I didn’t say anything. The runner was out, the inning was over, so I walked back to the dugout, trying not to limp.

Well, anyway, we lost the game 4 – 3. I was in the whirlpool soaking the knee when the Skipper sticks his ugly little face out of his office door and calls, “Hoss, get yourself in here, will you.”

The other guys in the locker room were already looking pretty glum. Now they all stared at me for a second, they they all turned the other way. None of them wanted to catch my eye. They all knew what was coming. Me too.

So I wrap a towel around my gut and walk to the Skipper’s office, leaving wet footprints on the carpeting.

“I’m gonna hafta rest you for a while,” the Skipper says, even before I can sit down in the chair in front of his desk. The hot seat, we always called it.

“I don’t need a rest.”

Old Timer's Game. Photo by Elena

“Your damned knee does. Look at it: it’s swollen like a watermelon.” The Skippeer is a little guy, kind of shriveled up like a prune. Never played a day of big-league ball in his life but he’s managed us into the playoffs three straight seasons.

“My knee’s okay. The swelling’s going down already.”

“It’s affecting your throwing.”

I started to say something, but nothing came out of my mouth. In the fifth inning I couldn’t quite reach a foul pop-up, and on the next pitch the guy homers. Then, in the eighth I was slow getting up and throwing to second. The stolen base put a guy in scroing position and a bloop single scored him and that’s how the Phillies beat us.

The Man Who Hated Gravity

The Man Who Hated Gravity

Once on the Moon, however, everything became quite fine. Better than fine, as far as Rolando was concerned. While clear-eyed young Moonbase guides in crisp uniforms of amber and bronze demonstrated the cautious shuffling walk that was needed in the gentle lunar gravity, Rolando realized that his leg no longer hurt.

“I feel fine,” he whispered to his wife, in the middle of the demonstration. Then he startled the guides and his fellow circus folk alike by tossing his cane aside and leaping five meters into the air, shouting at the top of his lungs, “I feel wonderful!”

The circus performers were taken off to special orientation lectures, but Rolando and his wife were escorted by a pert young redhead into the office of Moonbase’s chief administrator.

“Remeber me?” asked the administrator as he shook Rolando’s hand and half-bowed to his wife. “I was the physicist at Columbia who did that TV commercial with you six or seven years ago.”

Man Who Hated Gravity. Photo of Elena.

Rolando did not in fact remember the man’s face at all, atlthough he did recall his warning about gravity. As he sat down in the chair the administrator proffered, he frowned slightly.

The administrator wore zippered coveralls of powder blue. He hiked one hip onto the edge of his desk and beamed happily at the Rolandos. “I can’t tell you how delighted I am to have the circus here, even if it’s just for a month. I really had to sweat blood to get the corporation’s management to okay bringing you up here. Transportation’s still quite expensive, you know.”

Rolando patted his artificial leg. “I image the bionics company paid their fair share of the costs.”

The administrator looked slightly startled. “Well, yes, they have picked up the tab for you and Mrs. Rolando”

“I thought so.”

Rolando’s wife smiled sweetly. “We are delighted that you invited us here.”

The Wild and Hungry Times

The Wild and Hungry Times

By Patricia Russo

It was a gray day in summer. (Gray days were not confined exclusively to winter). The wind, sharp as a rasp, laden with grais of calcite abraded from the ruins of the Resennan lighthouse (the people of the coast has dismantles most of it, using the stones to repair walls and outbuildings, leaving the sailors to their own devices – but them sailors had been left to their own devices ever since the last lighthouse keepers had departed, taking the lamp oil with them) (delete comma.) blew strogly from the north. The north winds were the worst. His father, sitting by the fire, said nothig. His mother looked grim. His sister, pretending to be busier than she was, wiping her son’s chin when the boy’s face was clean enough, taking the spoon out of her daughter’s hand and stirring the porridge in her bowl after the child had already started to eat it, muttered, « it’s gray today. »

« It is, » Peero said. The kerchief tasted of old sweat; that bastard Bairen had probably borrowed it, as he had borrowed so many things, sneaking it bacl into Peero’s clothes-chest before slipping away. Peero supposed he should be glad Bairen had returned it at all.

The Wild and Hungry Times. Photo by Elena

Baby brother Bairen, with his hooded eyes and his liar’s tongue. He had started filching as a toddler – scraps of food, their mother’s thimble, a button from their father’s coat. And when he was caught, he would laugh, even when father beat him laugh like the very devil, though his eyes remained cold. As he grew older, he stopped being caught so easily; eventually he stopped getting caught at all. But this time he had been seen, in a public place, ripping a chain from a woman’s neck, then dragging her off who knew wheere, to do who knew what. The shame of it had struck his father speechless, until Peero had gone to the old man and said, « I will find the woman and make compensation to her. »

His sister stopped fussing with spoons and bibs and stray bread crumbs. « You don’t have to go today. »

« And what if it’ gray tomorrow, as well? »

« You can wait. »

Science Fiction and Fantasy 2015, edited by Rich Horton, Prime Books, 2015.

Being wild. Photo by Elena