Evening star. [volume] (Washington, D.C.) 1854-1972, 1911-10-28
HARPER A[TERSP !
Tells of Changes in Holding
Corporation Proposition.
WILL BE GIVEN LEGAL FORM
Work of Organization Will Follow
Approval by Chamber of Com
merce Directors.

The Harper. plan for establishing a
holding corporation to bring many light
manufactures to Washington is to be
put in complete legal form ior the proper
organization of such a corporation The
plan will then be laid before the manu-
features committee and the board of di-
rectors of the chamber for their indorse-
ment. This plan of procedure was de-
cided upon at meeting yesterday after
noon of the subcommittee OF the commit
tee on manufactures appointed to take
Up the consideration of the Harper plan.
The members of the subcommittee were
outspoken in their praise of the plan.
which they. believe is practical and will
bring to the District of Columbia a great
increase in business. besides giving en-
ploy;nent to many hundreds OF young men
and women.
Robert n. Harper, the father of the
plan for the holding corporation ex-
planned in detail number of changes
which he had made in the plan since he
laid it before the full committee on man.
ufactureS two weeks ago.
Legal Form for the Plan.
The suggestion that the plan be put i'm
legal form which would enable the Cham
Der of Commerce and individual support
ers of the plan to go ahead imme l,ateIy
with the organization Of such CORPORA
ton was made by Arthur c. Moses, who
said that he believed the plan could be
put into operation with great benefit to
the city and the citizens of Washin1-
ton. Henry L. Offterdinger made the mo-
ton that the plan be referred to Chaplin
Brown. general counsel CT the chamber,
with the request that he go over 1t with
Mr.. Harper and get it into legal form
for immediate action. f. G. Graham Sec
onded the motion. which was adopted.
The action taken by the subcommittee
yesterday is considered a long step to-
ward the actual work of organization of
the corporation. which. it is understl cd.
Will begin as soon AS the manufactures
the chamber have given their approval
to the plan of organization drafted by
MIR Brown and Mr.. Harper.
The plan contemplateS the establish
ed the District of Columbia Holding Cor
poration, capitalized at not less than
S.Jo.WD. The objects of this corporation
is to bring to the District of Columb a
many light manufactures, which will
use electricity and gas for power. and
which will not cause a smoke nuisance
in Washington. Paris. it is pointed out,
has many such manufactures which 20
to make it Il big commercial city with
out injuring it as a residential city.
Harper Tells of Changes.
Among the changes in the original plan
suggested by Mr.. Harper at the meeting
yesterday are the following.
1.-THE board of directors shall have the
authority. whenever in their Judgment
conditions justify such actions. to liqui-
date any Of the enterprises in which it
holds stock which has not proved to be
a profitable investment, or to sell its
stock in any Of the companies which
may have developed into such financia.
strength and solidity as to justify the
holding corporation to dispose of its in
,erest to others. without affecting the OBJ
ject of this corporation.
I'm every transfer or sale of this kind
a satisfactory guarantee must be given
that the business will be continued In the
District Of Columbia or adjacent sections
Of Virginia or Maryland for a certain
number of years.
1.-The price to be decided upon for such
holdings will be arrived at by an en-
deavOr to secure only fair investment
value based upon the past net earnings,
in conjunction with the probable future
prospects of the business.
THE principal received from such
sale must be reinvested in other indus
tries, and the profit. if any, must be
possible loss where Improbable lfquida-
ton may be necessary with other enter
prises.
mo such change. however, can be
made except by a twO-thirds vote of the
combined directors of the holding cor
poration and the company under consid-
ration
In Case of Delayed Investments.
IF the capital paid in should not find
prompt investment in suitable enterprises,
the funds could either he deposited in
bank at =, per cent interest, or be used
in the purchase of salable bonds bearing
at least per cent interest. In this way
no time would be lost in making the
money Immediately responsive to the
need of the corporation or for DIVIDEND
purposes, while waiting for the estab-
lishment of satisfactory industries.
Distribution of Dividends.
1.-THE dividend declared by the board of
directors of the holding corporation to
their stockholders should each year be
based upon tie aggregate dividend re-
ceived by it from the stool, it holds in
the subsidiary companies. In declaring
dividends the preferred stock should first
receive -. per cent. and the remainder
of available cash received as dividends
from stock held in the various COM
panies should be equally divided between
the preferred and common stock out
standing provided that the full dividends
paid on the two classes OF stock shall
not be more than 4 per cent for the Sec
ond year and per cent annually for the
next three years. An net earnings over
and above these amounts shall be passed
to the surplus fund. Thereafter one-half
of the net earnings from all sources over
and above per cent shall he passed to
the surplus fund and invested in, bonds
to pay not less than per cent annually.
and the remaining one-half to lie divided
among the stockholders as originally
provided for. No part of the surplus
can be used for an investment in amy
securities other than first quality bonds
MIR. Harper's idea is TO encourage the
establishment of many new factories.
permitting those that have already been
established to be bought out of the hold
ing corporation when they are firmly es-
tablished, with the understanding that
they are not to be moved from the Dis
trct Of Columbia or from tracts in Vir-
einia or Maryland Immediately adjacent
to the District.
The belief was expressed yesterday by
members of the committee that the hold
ing corporation would prove a good in
vestment and would grow to be a $780,
COO corporation within few years.
GEOGRAPHY ON WHEELS"