The Farmington times. (Farmington, St. Francois County, Mo.) 1905-1926, 1916-10-13
Why the Soc
Stock Dividend

Editor Pennington Tines Re-
Gently | ran across the following no.
tice of dividends, viz:
"At a meeting of the trustees of
the st. Joseph Lead Co., held on Aug
ust 20, 1916, distribution from the
reserve for amortization Of soc
share was declared payable Sep
TENDER 20, 1916, to all stockholders
of record at the close Of business Sep
TENDER 8, 1916"
AS soon as | read this notice it
flashed through my mind immediate
ly chat this might have been done for
either one of the following purposes,
or both:
1st. If someone is after the proper
ty, this would tend to brighten the
smaller stockholders, for after read
ing same they might think that the
company is getting toward the end
Of the rope in the way Of their lead
deposits, and would consider that this
would be the best time to get out.
This would depreciate the value Of the
stool; on the market
End. Or it might have been done
for the following purpose: That in
case labor should demand some of the
profits, the company could say:
"There are no profits, other than those
for the quarterly dividends of 25c per
share, and we are using our surplus
to gradually pay off the stockholders
to the amount of at least par value.
Whoever heard of company build
ing up an amortization fund and dis
tributing it in piece meals before the
funeral of the company? The main
object of an amortization fund is to
hold it in tact so that when the COM
pany is played out and dissolves, it
can pay out to its stockholders at
least the par value, OF 100 cents on
the dollar, for every share represent
ed in the corporation. To pay it out
in piece-meal is like putting so much
money in savings bank for your old
age and then drawing on the same be-
fore you become old and incapacitat-
ed. AS far back as 1913 it was sug-
gested to the officials of this company
Tor at least to some of them) that
the dividends be kept down to a min
imum until the debt was wiped out,
and then to pay reasonable dividends
out of the currens earnings, and the
surplus of same be set aside for an
amortization fund To this sugges-
ton, the gentlemen replied that the
stock was worth $4,000 share, and
that on account of their enormous
rich lead deposits there would be no
use in the creating of such a fund,
for the present generation had no
need to fear of the company playing
out, and that the future generation
could take care of itself.
Then again these same officials laid
stress on the big profits and loss sur
plus (paper), over and above their
liabilities, which as many know, was
created by land juggling on the as
sets side of the statement. So if they
are paying this so cents out of that
paper surplus, what is to be done with
the earnings for the two past quar-
tiers, or the six months ending June
Both, which, figured conservatively,
would amount to about $4,000, 100000?
And taking out the per cent divi-
dend, 1-2 per cent each quarter, or
81 100000, on S1,400,000 of issued
stock, leaves balance of about ST.
100000. A few years ago a mining
expert was employed to examine this
property and he reported that there
was lead in sight at the present rate
of production for 20 years, so if this
report is to be relied ON it will be
many, many moons before we will
have the opportunity of attending the
last sad rites of this company. This
is one more illustration of the ineffi-
cheney and incompetency of the pres
ent management of this valuable
property. OBSERVER.