Information provided by Beacon Journal Human Resources Department
1. Will I continue to receive the same pension I receive now?
Yes.
2. Will my benefits, such as life insurance, United Health Care and prescription coverage, remain in force at the same amount?
All such benefits will remain in effect at the same levels through the transition. Having said that, we are not presently anticipating any changes in vendors or coverage.
3. When can I expect to receive my McClatchy stock and the cash amount?
For the stock you acquired before E-trade was involved, Mellon Financial Corp. Shareholder Services is handling the exchange. You should receive a transmittal form from Mellon in the mail by the middle of July. Return it with your original stock certificates. Don’t write on the back of the certificates. (We recommend making a Xerox of each certificate just in case it gets lost in the mail; if it’s a very valuable package, consider insurance.)
Mellon will exchange each share of your KR stock for $40 in cash and .5118 share of McClatchy stock. Mellon will send you a check for the cash in seven to 10 business days after receiving your certificates. It will retain the McClatchy shares on its books (called DRS – direct registration system). That means that you will not get your McClatchy shares in certificates, but they will be held at Mellon. Call 1-800 205-7699 for more information, or go to www.melloninvestor.com .
If you have lost a stock certificate, fill out the part of the transmittal form that is the “lost certificate affidavit.” There will be a 1 to 2 percent charge for replacing the certificate, based on the number of shares it represents.
If you have stock that was held by the Bank of New York (Mellon’s predecessor), that stock should have been transferred to Mellon and it should be reflected on Mellon’s books. If it’s not, call the Bank of New York at 1-800-524-4458.
If you have stock in an E-trade account, it has already been converted to McClatchy stock and cash. (As mentioned above, you should have .5118 share of McClatchy plus $40 in cash for each share of Knight Ridder.) You may sell the stock or transfer the cash at your discretion. E-trade fees will be going up now that it is no longer handling the Knight Ridder employee stock purchase plan. In general, if you don’t make any transactions and your stock account is worth less than $10,000, you will be charged $40 a quarter. To find out how much it will cost you in your specific circumstance, go to the E-trade Web site and look under “fees.”
4. Will I have to pay income tax on the stock and/or cash?
You will probably have to pay tax next April on the cash you receive to the extent that it represents a capital gain from your stock if you’ve held it for more than a year or as regular income if you’ve had it for less than a year. Consult your tax accountant for specifics.
Regarding the .5118 share of McClatchy stock that you get for each share of Knight Ridder, no tax will be due next year (unless you sell it this year). However, when you go to sell the McClatchy – whether next year or a decade from now, you will have to compute the cost basis of each share. A list of the price of KR stock during the Employee Stock Purchase Plan period will be available in the Human Resources Department within a few weeks. We will update the FAQs to let you know when it is available. You should obtain a copy now and keep it with your valuable papers. You will need it when you sell your McClatchy shares and compute your tax on that sale.
5. Do I need to do anything concerning my stock or my benefits?
Watch your mail for the Mellon transmittal form coming in July.
This document is intended to provide you with current information regarding Knight Ridder stock and benefits, but in the event of a conflict the official plan documents will govern. The plan controls the benefits payable. Knight Ridder and McClatchy reserve the right to change, alter, amend, discontinue or terminate these benefits at any time with respect to any person without prior notice. This document is not intended to be a promise to provide this benefit package at all times in the future.
This document and the benefits described in it are not an employment contract, and do not affect the right of either you or the company to terminate your employment at any time, without cause or notice.
If you have additional questions please submit them to the Human Resources Department.
"In general, if you don’t make any transactions and your stock account is worth less than $10,000, you will be charged $40 a quarter."
ReplyDeleteThis is a way to get "nuisance shares" off the books. It's cheaper to sell than to not sell for a majority of us who don't have a ton of KR stock. Basically, I will go from KR stockholder to not a McClatchy stockholder, as I suspect many retirees will.
Clarification:
ReplyDeleteE-traders who have only a few shares of KR stock realize that the $40 a year eventually will eat up much of the value of their paltry amount. So, financially, they may be better off to sell, even if there isn't much money involved because there are too few shares. For others, from time to time all companies try to get those with less than 100 shares to sell and get the "nuisance" odd lots off the books. That hasn't happened yet for those who are not E-traders. But it wouldn't be unusual if it does happen to those with few shares, even outside of E-traders.
Sorry for the confusion. Hope the clarification doesn't create more questions.