My tracking has $12,506,216 as the basis for thier shares before the dividend. Since the dividend will likely be a return of capital it will lower their basis.

I presume you meant income statement and not balance sheet. I believe the dividends are in other income. Market appreciation is not in the income statement (part of what is called comprehensive income). If the special dividend is a return of capital it won't show at all in the income statement.

Disclosure: long PRLS and HBRF