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An ADR (American Depository Receipt) is a trading unit
issued by a trust, which represents ownership of stock in a
foreign corporation that is deposited with the trust. ADR's are
the customary form of trading foreign stocks on U.S. stock
exchanges, including the New York Stock Exchange (NYSE). The ADR
transaction involves the purchase of ADR's "cum dividend",
followed by the immediate resale of the same ADR's "ex dividend".
"Cum dividend" refers to a purchase or sale of a share of stock
or an ADR share with the purchaser entitled to a declared
dividend (settlement taking place on or before the record date of
the dividend). "Ex dividend" refers to the purchase or sale of
stock or an ADR share without the entitlement to a declared
dividend (settlement taking place after the record date).
James J. Tempesta (Tempesta) was an assistant treasurer in
petitioner's treasury department in 1992. He received his
undergraduate degree in philosophy and government from Georgetown
University and his master's degree in finance and accounting from
the University of Texas. Tempesta's responsibilities in
petitioner's treasury department included the day-to-day
investment of petitioner's cash reserves, including the
evaluation of investment proposals from investment bankers and
other institutions. He was also responsible for writing
petitioner's investment policies that were in effect during
September 1992. Petitioner's treasury department primarily
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