Attention, those of you who own AT&T, Inc. (T): Owners of T have received shares of the newly created spin-off Warner Bros. Discovery (WBD). Specifically, owners of T have received 0.241917 shares of WBD for every share of T that was owned on the date of record, 4/8/2022.
Concurrent with this, the stock price of T has been lowered and the strike prices for open T options have been adjusted down. This should already be reflected in the holdings for your brokerage account.
On Trade Day, you should sell the shares of WBD that you have received and use the proceeds to reduce the average cost of T, as detailed below. Please be sure to wait until after expiration to sell your shares of WBD.
Lattco PRO/AutoPilot Clients: Please sell your extra shares of WBD first thing Monday morning. Once the shares are sold, please contact us, and we will adjust T for you.
1) Take the net amount for the sale of the WBD shares, and divide it by the total number of shares that you currently own in T; this will give you the cost basis adjustment that you will need for T. For example, if you receive $1,000 in net proceeds, and you own 500 shares, you would take $1,000/500 for a cost basis adjustment of $2 per share.
2) Take the cost basis adjustment figure, and subtract it from the price paid for each of your outstanding bundles of shares on the position. For example, if you had a bundle of shares that was purchased for $40 and a cost basis adjustment of $2, you would subtract $2 from $40 to arrive at a new price paid of $38.
3) After you have completed adjusting each bundle of shares, you will
update your band rule worksheets to reflect the adjusted prices.
4) Update your Allocated Cash based off the new adjusted Initial
Purchase Price. Following this, you may resume regular trading of the