Evening journal., 1922-09-13
STOCKDIVIDEND
BY HERCULESCO.
Distribution of 100 Per Cent.
Coincident With Capital
Increase
STOCKHOLDERS TO
VOTE OCTOBER "a

The board OF directors of Hercu-
les Powder Company at meeting
yesterday unanimously adopted a
resolution declaring it advisable that
the first three paragraphs OF section
of its Amended Certificate of In
corporation be amended for the pur-
pose of increasing its authorized
capital stock to $4,000. 900 to be di-
vided equally-s2O,OOO.OO 900 7 per
cent. cumulative preferred stock,
and $40, 0,000~common stock-and
called a meeting of the stockholders
to be held on October "a at eleven
o'clock at the office of the company
in the Delaware Trust Building. Will
mington. to take action on such reso-
tuition. The stock books of the COM
pany will be closed for the transfer
of common and preferred stock from
October A 10 October "a.
"The general purpose of the au-
thorization of the additional stock is
to provide means through which the
company may obtain the additional
capital that it may require from time
TO time over and above that which
can be reserved out of surplus earn
ings," the company said in a state
ment today to stockholders. mo
additional capital is required at pres
ent and no Offering of stock con-
templated. The immediate purpose
of the additional preferred stock is
to retire the outstanding Aetna bonds
at or before their maturity.
'The immediate purpose OF the
additional common stock is to trans
fer to permanent capital account, by
means of 100 per cent. stock divi-
dend, a substantial part of the ac-
cumulated surplus.
"All the charter provisions, re-
stricting the issue of preferred stock
within definite limits governed by
assets and earnings remain absolute
ly unchanged. The exchange of all
Aetna bonds on the basis contem-
plated would make the total out
preferred stock about S12,-
100000, only 35 per cent. of the
company's total net assets. The con-
version of S7.15O,OOO of surplus
into common stock will again make
the common stock outstanding ex-
ceed the preferred and will perma-
nently assure retaining in the busi-
ness assets heretofore lawfully avail
able for distribution as dividends on
common stock, but which the best
interest of the company clearly re-
luire retaining.
"The assets of the Aetna Explo-
sive Company. Inc, were covered
by a mortgage securing the issue of
$4,000, 900 of per
,ent. bonds. This mortgage obliga-
ion was assumed by the Hercules
Explosives Corporation, when it pur-
,hased the assets of the Aetna Ex-
'losives Company. Inc. and your
company owns all of the, capital
tock of the Hercules Explosives
While It is, therefore,
lear that these bonds are not an
obligation of your company. It is
clear that your company
must take care OF them as they ma
ure If it desires to continue the use
f the assets OF the Hercules Explo-
Ives Corporation.
Your company's policy has al
'ays contemplated that its invest
lent would be confined to its two
lasses Of stock (preferred and COM
lon) and that all its assets should
tand behind these issues from lien
Z any sort whatever. 1t has, there
)re, seemed to the company's best
lterest to offer the bondholders the
pportunity to exchange their lien
n the Aetna assets for preferred
ock with the broader security of
le entire assets of the Hercules
owder Company. This opportunity
as already been availed of by some
the larger holders of the Aetna
onds but until the additional stock
authorized, It is impossible to
AXE the offer general. It Is planned
lat the exchange shall not increase
le company's annual interest and
vidend obligations"