The Worcester spy. [volume] (Worcester, Mass.) 1898-1904, 1899-06-26
WILL NOT RESIGN.
The American Steel and
Wire Directors are Work
ing in Harmony.

Those who have been watching Steel
e. Wire closely since last Thursday,
say that the absorption by inside in
terests has been quite marked. while
selling by traders even down to the
lowest prices has been persistent, but
without much effect.
The large amount of the stock
bought by inside interests has begun
to tell, and the attempt on the part
Of the short interest to cover sorle
stock after the announcement of no
dividend, Immediately rallied the price
In the directorate no feeling indica-
tive of special hostility has grown out
of the failure to pass a dividend on the
common at Fridays meeting and it
is given out authoritatiVely that there
will be no designations as a result Of
it. There have been some changes made
in the board but not as the result of
dividend action.
1t was desired to have more repr2-
sentation in the directorate from New
Jersey, and to this end some new men
We're put into the board.
External evidences, however, do not
point to condition of harmony in the
directorate of the Steel & Wire Com
pany. If a body of business men have
a common duty, they generally per-
form it without unnecessary delay.
Such a performance did not charac-
terize Fridays meeting.
The certificate of Incorporation of
Steel & Wire says: 1.-THE holders of
preferred stock shall be entitled to re-
ceive in each year out of the surplus
net profits of the corporation the fixed
yearly dividend of per cent, payable
quarterly, before, any dividend shall be
set apart or paid to the common stock,
but shall not be entitled to any further
dividend or share of profit"
The action of the Steel &, Wire Co. in
withdrawing the cash discount on or
ders has caused considerable stir in
the jobbing trade. 1t means for job
bers either a diminished profit on nails
or the necessity of making prices net
cash In view of this condition e
things, the Steel e. Wire Co, intimates
that it will soon make another advance
in prices to cover the advance in raw
material, and that when this action is
taken the difference between jobbers'
prices and car lot prices will be is cents
per 100 lbs. instead of 10 cents as at
present.
Parties who have recently seen the
American Steel & Wire Co. will this
six months equal $6,000,O00.
The counsel for the American Steel
&. Wire Company, Saturday, registered
at the court house the deeds which
were passed March II, when the two
companies went into the American
Steel & Wire Company.
Apropos of the Federal Steel divi-
dend question. Watson & Gibson have
nil ho hnapH
fore the court until July 3. The COM
pany claims that while it cannot pay
a dividend on the common out of the
earnings of any year until it mas m st
provided for the per cent dividend
on the preferred by having paid
one-uuarterly dividend on the later,
having declared a second and set aside
funds for the third and fourth, 1t can
then legally proceed to pay a dividend
on the common. We very much doTbt
this, for while the books already show
enough earnings in five months to ray
these dividends, the management can
not be absolutely sure, even with its
assumed profitable contracts ahead.
that enough losses may not be incurred
during the remaining seven months TO
more than consume all the apparent
surplus now to the good of the corl-
mon stockholders. Suppose a great de-
falcation takes place. Suppose its debt
ors fail, steel falls in price, and it Can
not collect its debts. Suppose a big
strike occurs among it's employees and
forfeits are enforced against its de-
faulted deliveries. Suppose its works
are destroyed by fire, earthquake or
mob violence. Then its balance sheet
for the entire year would be very diff
ferent from what it promises to be.
The earnings of a company applicable
to dividends in any year cannot be de-
termined until the year closes and all
contingencies have been eliminated. It
is not at all certain but what the per-
son who brought the suit will be per-
suaded to discontinue it, but If he
fights it in good faith he is likely to
win on the merits of the legal propo-
sition on which he bases the injunc-
ton"