New Britain Herald Newspaper, December 13, 1928, Page 20

NEW BRITAIN DAILY HERALD, THURSDAY, DECEMBER 13, 1928 . (Reprint from Wall Strest Edition of the Hartford Times, December 12, 1928.) CITY CO. DIRECTORS WOULD AUTHORIZE DOUBLED CAPITAL Of This Amount 2,000 Shares Increase Is Voted Now 20 WARRANTS FOR ONE FULL SHARE 2 Per Cent.—ah and 5 Per Cent. Stock Dividend— Stockholders Act Dec. 20 An increase in the authorized capi- tal of the City company of Hartford, Inc., from $1,000,000 to $2,000,000 and a dividend of 7 per cent., includ- ing 2 per cent. in cash and 5 per cent. stock dividend, were recommended at a meeting of the directors today. The resolution to amend the charter and to declare the dividend will be acted upon at & special meeting of stock- holders on Dec. 20 at 12:30 p. m. The plan calls for an authorized eapital of $2,000,000 by increasing the present 40,000 shares of outstandin, stock at $25 par to 80,000 shares of the same par value. Upon approval of this recommendation, the directors will declare a dividend of 7 per cent. of which 2 per cent. will be a cash dividend and 5 per cent. a stock divi- dend, both payable to stockholders of record of Dec. 20. Each share of stock will entitle the holder to one- twentieth of a share of the new stock and warrants will have a cash value of about $4.50, which with the 50-cent cash dividend, will mean a cash value equivalent of $5 a share. The City Company of Hartford, Inc., a securities corporation, is man- aged by officers of the City Bank and Trust compnn‘*; Its officers are: Pres- ident, LeRoy W, Campbell; vice-presi: dent and counsel, Frank A, Hagarty; treasurer, Alfred W. Jacobs; tary, Clayton C. Chase; stant treasurer, Ernest S. Warner; and as- sistant treasurer, Allen I. Balch. Fred P. Holt is chairman of the board. Letter to Stockholders The company sent the following let- ter to stockholders today: “The directors have today passed a resolution recommending to the stock- holders that the charter of the cor- poration be amended to provide that the authorized capital stock of the corporation shall be increased from $1,000,000 to $2,000,000. Upon the approval of this recommendation by the stockholders, the directors will de- clare a dividlend of 7 per cent. of which 2 per cent. will be a cash divi- dend, and 5 per cent. will be a stock dividend, both payable to stockholders of record December 20, 1928, checks for the cash dividend to be mailed on or about Janusry 2, 1929, and war- rants for the stock dividend to be mailed on or about January 15, 1929, “On Dec::ndber 20, 1927,{ t};izs com- pany recei payment of 50, for its first issue of stock. The 5'223 was heavily oversubscribed and an ad- ditional $250,000 was issued and paid for on January 15, 1928. June 25, 1928 another increase of $500,000 was made. All stock was issued by this company at par value, $25 per share, free of any premium charge or under- writing expense. “This furnished the company an average paid in capital for the twelve months’ period of about $725,000. After deducting all expenses other than income tax, a net profit has been realized of $153,900. This represents actual profits taken and has no ref- erence to securities on hand whose to- tal market value is in excess of cost. The profit is equivalent to 21 per cent, on the average capital employed dur- ing the year, or 15.39 per cent. on the present capital of $1,000,000. “Realizing that this type of invest- ment administration is subject to variable results contingent on security market conditions, it was the opinion of the directors that the declaration of a dividend should be liberally based on the results obtained, but, neverthe- less, should not be a heavy charge against the operating funds of the company. That accounts for the con- templated division of the dividend in- to part cash and part stock. “Upon approval by stockholders, each share of stock held as of Decem- ber 20, 1928, will entitle the holder to ventieth of a share of new stock. older wish to sell his war- will have a cash value of about $4.50 per warrant. In addition, each share of stock, as of record De- cember 20, will be entitled to 50 cer cash dividend. In reality this me a cash value equivalent to 85 per share, which is equal to 20 per cent. return on the par value of the stock and about 5% per cent. return on tle present market price, “For those who may prefer to sell their warrants and thereby convert their entire dividend into cash, the undersigned, acting for a committee, vill purchase all or any part of such at $4.50 per warrant. Such sed to increase the holdings of emplo: officers and di- rectors of the City Bank & Trust : Those wishing to adjust hts to even up holdings, will have s to the usual investment house “No fractional shares will be issued. It requires twenty warrants to obtain one full share. These warrants must be converted into stock not later than 3 p. m., February 15, 1929. Conver- sion will be made by the transfer agent, the City Bank & Trust com- pani, trust department. The directors and officials convey to you their best wishes for a Happy Christmas.” Very truly yours, LeROY W. CAMPBELL, President. As will be seen by the above the di- rectors intend to issue at present of the authorized increase of capital of $1,000,000 only 2,000 shares of a par value of $50,000. WE DESIRE to call your attention to the re- prints from the Hartford Times and the Hartford Courant showing the market appreciation and divi- dend retum of an investment holding company or- ganized one year ago. We recommend and offer such an investment op- ¢ portunity in the purchase of The Fidelity Company of Connecticut, Incorporated. The retum of the coupon will bring full'details. GARDNER & CO. INVESTMENT SECURITIES 75 Pearl Street BOSTON PROVIDENCE Hartford, Conn. WORCESTER | i | (Reprint from Hartford Courant, December 13, 1928.) Cash, Stock Dividend By City Company Generous First Anniversary Payment Equal to 209 on Par—More Capital to Be Authorized The City Company of Hartford, Inc., the security investment cem'lpnny paralleling the Gity Bank. & Trust Company, having the same officers, has declared its initial dividend, the first payment to be equivalent to 20 per cent on the par value, The direc- tors voted payment of 7 per cent, 2 per cent in cash and § per cent in stock. At the current market of $110 for stock the distribution is equivalent to $5 a share. One new share will be distributed to each 20 held fractional warrants pro rata will be issued. The dividend .will bt pay- able to stock holders of record Decem- ber 20, The cash didivend will be mailed JumurLZ and warrants for the stock will be issued on or about January 15. To provide for the stock distribution it es necessary to increase the authorized capitalization the maximum of $1,000,000 now being _outstanding. Rirht to issue stock u| to $2,000,000 will be sought. A special g:tti of stockholders will be held ember 20 The stockholders’ meeting to act on the recommendation to increase the authorized capital will come exactly one year after the date of the initial payment of capital into the company, On .December 20, 1927, subscriptions to the amount of $250,000 were re- ceived and because of the heavy over subscription, an additional $250,000 was issued and paid for January 15, this year. An increase of $500, was paid in on June 25. All the sub- scriptions were paid at par $25, free of premium and without any under- ‘writing expense, Favorable Results in Year A communication to stockholders by President LeRoy W. Campbell sets forth a statement of results as fol- lows: “The company had an average paid in capital for the twelve months’ period of about $725,000. After de- ducting all expenses other than in- come tax, a net profit has been real- ized of $153,900. This represents ac- tual profits taken and has no refer- ence to securities on hand whose to- tal market value is in excess of cost. The profit is equivalent to 21 per cent on the average capital employed dur- ing the year, or 15.39 per cent on the present capital of $1,000,000. , “Realizing that this type of invest- ment administration is subject to variable results contingent on security market conditions, it was the opinion of directors that the declaration of a dividend should be liberally based on the results obtained but, nevertheless, should not be a heavy charge against the operating funds of the company. That accounts for the contemplated division of the dividend into part cash and part stock. “Upon up{rovnl br stockholders, each share of stock held as of Decem- ber 20, 1928, will entitle the holder to Y40 of & share of new stock. Should a holder wish to sell his warrants, they will have a cash value of about $4.50 per warrant. In addition, each share of stock as of record December 20, will be entitled to $.50 cash divi- dend. In reality this means a cash value equivalent to $5 per share, which is equal to 20 per cent. return on the par value of the stock and about 5!; per cent. return on the present market price. “For those who may prefer to sell their warrants and thereby convert their entire dividend into cash, the undersigned, acting as a committee, will purchase all or any of such war- rants at $4.50 per warrant. Such warrants will be used to increase the holdings of the employees, offigers and directors of the City Bank Trust Company. Those wishing to adjust rights to even up holdings, will have access to the usual investment house channels, “No fractional shares will be is- sued. It requires 20 warrants to ob- tain one full share. These warrants must be converted into stock not later than 3 p .m., February 15, 1929. Con- version will be made by the transfer agent, the City Bank & Trust Co., trust department.” The success of the City Company of Hartford, Inc., has been followed with much interest in the market. The stock reached a high at 135 earlier in the year, and during the past few days there has been activity in the market in anticipation of favor- able action just taken. Fred P. Halt is chairman of the board of the City Company of Hartford as well.as the City Bank & Trust Company. GARDNER & CO., 75 Pearl St., Hartford, Conn. Gentlemen: Kindly submit details why The Fidelity Company of Connecticut, Inc,, is an outstanding investment pur- chase today—this inquiry.places me under no obligation. IO «aocvvicnmnniant wninesswannasissiusin KOOI .. ivicirnnisninssseniinnvasinaii