Evening star. [volume] (Washington, D.C.) 1854-1972, 1899-07-12
INSURANCE COMPANIES
Circular Sent Today to the Potomac Com
pany's Stockholders.
Plan of the Proposed Method Of Unit.
ing With the Lincoln Company
Plainly Stated.

| stockholders of the Potomac Insurance
Company of Georgetown, which is as fol-
| lows:
The following report was adopted at the
| regular meeting of the board of directors
| OF The Potomac Insurance Company of
Georgetown held at the office of the COM
papy at 1910 32d street northwest. Wash
| ington, DC, on Tuesday July H. 1899, and
copy of said report was ordered to be
printed and sent to each stakeholder with
the favorable recommendation of the
board:
ITO the stockholders of the Potomac In
surance Company of Georgetown:
1T is proposed by the directors of yoUr
company to issue the full amount OF stock
authorized by its charter. thereby increas-
| ing the capital stock to $2o091o. To do
this 1880 additional shares will have to be
issued The plan proposed is to declare
from the surplus fund a dividend Of such
size as TO give to each shareholder of rec
ord July l. 1899, an additional share for
each three shares or multiple thereof held
at that date, and to each holder OF one and
two-share lots q cash dividend of $40 per
share in lieu of stock or scrip and also a
cash dividend of so per share upon one
and two-share holdings in excess of three
snare and multiple thereof lots.
Proposed Issue of stock.
ITO pay the above dividend to the pres
Git siidTeHOIUeFS WOULD require the lSSU-
ance of bout $50 shares. And the remain
ing twenty-four shares out of the $50 is to
be retained by the company as part of it's
surplus fund. the cash dividend to the one
and two-share holders which is to be paid
as Aforesaid being in lieu of the issuance
of these shares.
with the 400 shares remaining it is pro-
posed to purchase the entire capital stock
OF the Lincoln Fire Insurance Company of
the District of Columbia and merge it with
this company by giving share of Po-
tomac stock for five shares Of Lincoln
stock.
Upon the completion of the exchange of
the stock of the two companies it is pro-
posed to liquidate the Lincoln company.
Pending the exchange the merger would be
practically completed by means of a rein
suranee contract whereby the Potomac
would reinsure outstanding Lincoln poll
cies- After merger the book value of your
assets would be in round numbers $3.50, 900
-S2ooVo OF which would be capital and the
remainder surplus. Assets of this size
would be sufficient to permit of the extern
sion of our business throughout the United
States If it should be deemed wise to do
so later, whereas our present small cap
itahZaton is insufficient to allow US to en-
large our business, which is absolutely To-
cal and quite limited and in the struggle of
composition causes us to be much handi-
capped.
some of the Expected Results.
hS HISloIy ol lHe CROWN OF the Lincoln
company is sufficient evidence of the de-
Sirablllty for making the merger. Its stock
holders by active endeavor in nine Years
nave accumulated a surplus over their CAP
ital stock of over s1O4 coo besides paving
) percent dividend for the past six years
on their capital of 100000 and all losses
ana expenses incurred since organization
IL Is confidently believed that the infusion
or this new blood into the old Potomac,
no duo 1fafrr .zF.,
sons concerned. The combined gross re-
CelPts OF the two companies based on the
business of the past year would be in round
numbers about as follows:
Potomac, premiums after deducting re-
insurance and Cancelled policies. SIS 100:
Lincoln, premiums, after deducting REIN
surance and Cancelled policies, s36 500;
Potomac, interest, dividends etc S11 400.
Lincoln, interest, dividends etc. s1o6 $40:
making total Of $74 100. And it is be-
heVed that the reduction of expenses Incl
dent to the consolidation. and the general
operation of the company upon a percent
age plan would materially increase its net
profits to the stockholders. We have no
hesitation therefore in recommending the
foregoing. G. T. Dunlop, w. Riley Decide,
M. j. Adler. committee. Washington, D.
c., June I, 1899.
A Special Meeting.
"a special meeting of the stockholders of
this company will be held at the office of
the company, No. 1919 sd street north
west, Washington, D. c., at 1 o'clock pm.
on July %, 1899 for the purpose of voting
for or against the issue of 1880 additional
shares of the capital stock of the company
the proceeds of said issue to be used to
carry into effect the recommendations of
the committee, as contained in the above
report. If you will be unable to attend
please sign proxy inclosed and have your
signature witnessed by two witnesses and
return by inclosed stamped envelope. Any
further information desired by stockhold-
ers will be gladly furnished by either MEM
Der of the committee if called upon. By
order of the board of directors June II,
1899. Very respectfully, w. Riley Decide,
president"
The present capital stock of the Poto-
mac company is $4,000 the par value of
which is SO, and the quoted market value,
SO.
The capital stock of the Lincoln COM
pany amounts to 100000, the par value of
which is So and the quoted market value
oh