The copper era and Morenci leader., 1921-10-07

RecoverieS.,
 2. The price is
 (a) Payment of the dividends on the A Preference Shares and Prefer ence Stock and retirement of these shares and stock Cat the expense
 of that Corporation within five years.
 (b) 50,00O fully paid Shares of s1O0 each of the Corporation, of which the capital will then be 50O.OOO Shares of $1O0 each
 (c) The purchaser assumes all the
 liabilities, other than undisclosed contingent liabilities, not incurred in the ordinary course of business It
 is believed that all liabilities have been disclosed.
 g. The Company is to have the right to nominate a Director of the Corporation.
 i It will thus be seen that, while the
 "A'' Preference Shares and the Pre- ference Stock will in the meantime
 remain, Phelps Dodge Corporation
 undertake liability for these Shares
 and Stock, and therefore in effect the ordinary Shareholders of this Con- pany will own one-tenth of the Capital Stock of Phelps Dodge Cor poration, and thus retain a one-tenth
 interest in the mining properties of l this company.
 It is not possible at present to place a market value upon the Shares i of Phelps Dodge Corporation, as trans 1 actions seldom take place. the bulk
 of the Shares being held by few fami-
 ly groups. The dividends which have l been paid by the Corporation for the ! past few years have been as fol- ! lows:-
 ! 1909, 12 per cent; 1910, 12 per cent. | 1911, 12 per cent; 1912. 15 per cent. i 1913, 161s per cent; 1914. II per
 cent; 1915, 20 per cent; 1916. 32i@ i per cent; 1917, 32 per cent; 1918. 30 l per cent; 1919, 10 per. cent; 1920. 1 10 per cent; in all PIG per cent, giv- i ing an average of IS per cent per an- num- During the current year the i dividends have been restricted to 4 ! per cent per annum.
 i Large expenditure (to substan- i tial extent out Of revenuel has Seca
 made by Phelps Dodge Corporation
 within recent years, which have
 placed it in the position of being able
 to increase production considerably ] and advantageously when conditions
 warrant it.
 In order that the Shareholders may
 retain free market for their Shares
 it is proposed to keep up the present
 Arizona Copper Company. Limited
 but as it will practically be an h.
 vestment Company only, the eNpen-
 ses of management will be very con
 siderably reduced.
 The arrangement is not one which under normal circumstances tho
 Directors would have submitted for approval, because it involves the
 transfer of the whole of the under : taking for an interest in an American Corporation Under existing cir
 cumstaces, however, they unanimous
 ly recommend that the proposed . arrangement be approved. for the following reasons:
 1. If the Company is to ccItinUe a separate existence money will re- quire to be raised to meet the lNSses down to 31st May last. ls VII as the further indefinite losses which : will accrue before normal profit earning conditions return. Even when that comes. provision would have to be made for the repayment ! of the money so borrowed out of l profits, with, in all proba bility. a
 HSdNE lOSS LII "AS W l. penditure has to be met on the ether : side.
 2 Further. after a few years the future of the Company would in . great measure depend on the treat 5 ment of large bodies of low-grade 5 ore already ascertained to exist. and
 which it has been demonstrated re gently can be profitably treated, but that only after suitable plant has 3 been erected That plant would in volve an expenditure estimated at t not less than s1O.OOO.OOO. = 3. By selling for Shares and not - for cash the Shareholders retain the advantage of participating in the
 prosperity of the industry when. as , is to be expected, the conditions oi the trade improve.
 \ :. Phelps Dodge Corporation is one
 of the largest Copper-operating Cor
 porations in the world, of high busS r ness repute, and owning large and
 valuable mines. Their position iS such that the resumption of diVf l. dends by this Company (thrOuSf q dividends declared by that Corpora
 tion may be expected at an earlier h date than would be practicable | D. this Company continued as at pres is ent
 /" If you are not to be at the Meetins
 we shall be obliged if you will hl l. up the enclosed proxy form and re 1T turn it as early as possible, but n e any event so as to be in the hand'
 of the Secretary not later than th' IT, morning of Friday, 30th instant d Yours faithfully. r.. By Order of the Board. 1f GEO. READMAN, Ch"5r1' an in WILLm. FINLEY NH 1 ES.