Document Z4wYOXjRbnYJzeZMXMq5xqZ0d

PtAINTIFF'S EXHIBIT WRGf309 *^ i DewetaxdAlmy Chemical Company c+&f*m*X*+*. MAttACNuacnt ' CAUFOIIMIA ./AMAMfOU(eANAOA T**t*, TAUT . ' ' .4f^- ' - '*":WM/H(--**fW;*sti.awi.KoM_ rf * Nonmenma or DKWAICO AND GOLD SEAL PRODUCTS Cambridge B, MASSACHtrsETTS "DC`CWMAICLCA0O~OK0CSTB0N Notice of Special Meetin'o 'of Stockholders rd the Stockholders of Dewey and Almy Chemical Company: > ^ You are hereby notified that a special meeting of the stockholders of the corporation wul be held at the company's office, 235 Harvey Street, Cambridge, Mass., on April 17, 1930, at four o'clock in the afternoon for the following purposes: 'a' 1. To see if the stockholders irip vote to increase the authorized number of Pass A common shares with* ' * , out par vmluefrom 37,60$jhares to 40,156 shares. *, U*rT & , , 2. To see tf dK^Stockholdera-^fll vote to increase the authorized number:of Oast A preferred shares* r* from 9QD03^7,200 shares^ :* 3. To see if jS(fstockholders sriO vote to offer to the preferred and Clam A preferred stockholders of record ApriF tO^, 1930 the right to subscribe for Class A preferred stock and Class A common stock in blocks of two shares of Clam A preferred stock and one share of Clam A common stock at the price ; of $100 and-accrued dividends per share of Class A preferred stock and $1 per share for the Class A commoifslQE& such blocks to be offered on the basis of one such block for etch 12 shares or fraction ; _ of 12 shara df the total number of preferred and Class A preferred shares standing in the name of wdi stallholder on the books of the company. 4. To seeiltfie stockholders will vote to offer to the common and Clam A common stockholders of 110, 1930 the righrto subscribe for Class A preferred stock and Class A common stock,' two shares of CIssb'A preferred stock and one share of Class A common stock at a price, 1 accrued dividends pier share of Class A preferred stock and $1 per share for the flam such blocks to be offered on the basis of one such block for each 45 shares or fraction of the total number of common and Class A shares, standing in the name of stockholder on the books of the company. , , - jjgjT ; the stockholders will vote to authorize the director* to sell 600 shares of Chut A preferred stock add 300 shares of Class A common stock in blocks as aforesaid to such employees of the com* pany as they shall determine (including employees of subsidiary and affiliated companies) other than Messrs. Dewey and Almy at not lea than the same price a said blocks are offered to stockholders, such blocks to be offered on such terms snd at such times as directors--.psay determine. . 6. To see if the stockholders will authorize the directors to deteritfae the ttmc terms and manner of the disposition of the balance of the Class A preferred and Ontumon stock to be authorized, sub- ject to the condition that in the case of any such stock fot.cash, it may be iaued only in blocks of two shares of Claa A preferred stock and one A common stock st a price not lea than- $220 per block plus accrued dividends on efred shares. 7. To sreif the stockholders will vote to authorize the rigtaklp. Subscribe, the date for payment of sui "to'stockholders, and other details in (triune the date of expiration o s toitfcjpfArarrants to subscribe t$-Kr the iamajre tff additional stock ta^he1 . L, | 8 any other businessUtat may properly come before the meetiqg. ^ ** * ~ MASS U VOTED IN PRESENT IN ?i jApril 10, 1930. RETURN IN THR ENCLOSED STAMPED ENVELOPE THE ENCLOSED PROST WHICH WILlf OP THE ABOVE UNLESS CONTRARY INSTRUCTIONS ARE RECEIVED OR TOU ARE.' -^CSARLE8 Almyr, JrJ^ cm. .4 i V 181 V The President presented copies of eleven contracts with the General Rubber Company and the United States Rubber Company which have been executed. Upon motion duly made and seconded it was v VOTED: To approve the action of the officers of the x corporation in executing the contracts presented with the General Rubber Company and the United States Rubber Company as follows: Asbestos License Agreement Addendum to Asbestos License Agreement Modification of Shoe Cement'Agreement New England Jobbing Agreement Modification of Hair Cloth Agreement Latex Purchase Agreement Impregnation Option Agreement Impregnation License Agreement nAn Impregnation License Agreement nBn Rubber Latex Research Corporation - Supplement to Asbestos License Agreement Supplement relative to Dispersions Process, Inc. The President presented a contract which had been entered into with Rubber Latex Research Corporation. VOTED: Upon motion duly made and seconded it was To approve the action of the officers.in executing the contract presented with the Rubber.Latex Research Corporation entitled "Modifica ion of Rubber Latex Research Agreement." VOTED: Upon motion duly made and seconded it was That the Clerk be directed to mall to each Stockholder the following call, dated April 10th, 1930, for a Special Meeting of the Stock holders to be held on April 17th, 1930: Upon motion duly made and seconded it was 183 VOTED: That the President be instructed to mail to each Stockholder with the call for the Special Meeting - of Stockholders the following letter, dated April 10th, 1930, entitled "Comments on Call for Special Meetin DeweiaxjbAimy CirrcuiGAx Comkany PAOTORK9 MaillMC, WAMAOHMMTTf QARUNO, CAUFOAMIA FAWN HAH, QUIaQANAOA NAWkCt,ITAl.Y pawDmAwHrvsCrr Xm.HAM.Oim- r KAKCFAcnmns or BEWAXCO A39B GOLD 8AL PRODUCTS Cambridge b, Massachusetts WO* CAttC AOpMtl r-- . Comments on Call for Special Meeting To the Stockholders of Dewey and Almy Chemical Company: -v / Enclosed a formal notice of call for a special meeting of the stockholders to be held oo April 17, 193$, - for the purposes set forth in such notice. tif' ? Kj Since the writing of the eleventh annual report: of your Company's operations, 4,500 shares of OwU^./if preferred stock have been taken up by Kidder, Peabody and Company (under their contract with the Company!" i to fmatoce present projects and provide additional working capital. The- proposed increase in capital <4 Tour Company outlined in the above call is recommended to enable the Company to acquire stock of MultibctttwCom- ? pany in accordance with an offer, which has already been accepted by the principal stockholders of Maftfhesttsv I Company, for not less than 75% of each of the preferred and common stocks of Muldbestos Company.*.tfotfe#'.' the terms of this offer, payment for this stock will be made as follows:-- .-r , For each two shares of preferred. stock of Muldbestos Cynpany, the holders will receive ooe "sharedV's,' of Dewey and Almy.Chemical Company Claw A preferred, stock, and $87XX) in cash plus $235 to adjust dividends to May 1, 1930; and for each share of commoorscock, $20.00 in cash In addition, our Company wiU be called upon to pay $25,000 to cover certain expenses, commissions, etc. If the offer is taken up by all the preferred and common stockholders'of Muldbestos Company, this will call for 3,088 shares of Claw A preferred stock of Dewey and Almy OhcnucaT Company and approximately $526,000; in cash. . ' . j&t; ' ' J V ; Muldbestos Company is a loAg*established Company, located at lAfslpole, Massachusetts, where it mamt^ fxfctures both wove* and molded brake bands and dutch facings impregnated with asphaltic and oQ type binders* Its balance sheet at January 1st showed working capital of approximately $408,000. and plant assets carried oo the books (after deduction of allowances for depredation) at approximately $632,000. The Company's wnimp last year were slightly over $10O,0QO-, but due to the changing trend in,`brake linings, it is highly desirable that Multibestos Company should also Kni position to merchandise s line of rubber-bonded flexible and rigid molded brake linings anf| :ch firings. We have developed and 'applied for patents upon such products, We have also of reciprocal licensing agreements with the United States Rubber Company under the terms ed that that Company will merchandise a large volume of brake bands manu- factured by us. In view Company to sible to man your Directors believe that when^Mulribestos Company is licensed by. our licts, together wh other asbestos' rubber-bonded materials, it should be posume of business done by Multibesfhs Company. i t If the stodchol the actions outligtf in the call, transferable warrants good until May 20th to ; subscribe for new led in due couraaito the stockholders. Arrangements will be made with Kidderv- Peabody and Compan; purchase and sale such warrants by them, so that persona desiring to dbpoae 0# *r" their rights may be corai do so to the best advantage and so that stockholders desiring to subscribe to more tbhan their allotment m*v have an opportunity to purchase additional stock. v* I? . f , V If the stockbohiBni approve the recommendations of the Directors full informariosTTw toibe manner of \r*' exercising rights and puithasing and selling warrants will be mafletfpromptly to you together with the amdi>f of warrants to which yoo irt entitled. _ ... 't t Payment for sh*& anrercdj>y these warruttjjritibe due t . ....J..u..n..e....1..,...1..9.3. 0. ^ ft< t It is hoped that jansnB be present at thrkfetfag- arid vote, but if you are unable to do'so yoo 9 to execute the enclosed proxy and to return it iAflfcf accompanying ^envelope. - f 184 VOTED: VOTED: Upon motion duly made and seconded it was To authorize the officers with Merrill Griswold, _ and upon approval of counsel (provided the Stockholders authorize the increase of capital stock and the issuance thereof in accordance with the foregoing call) to determine the date of expiration of rights to subscribe, the date for payment of subscriptions, the form of warrants to subscribe to be issued to Stockholders,, and issuance of stock to employees, and other details in connection with the issuance of stock to Stock holders, and mailing to Stockholders the necessary details and warrants. A Upon, motion duly made and seconded it was To approve the action of the President in mailing to the Directors of Uultlbestos the following letter: April 9, 1930. To the Directors of Uultlbestos Company, c/o Stoughton Bell, Boston, Mass. Gentlemen:- In connection with the offer we have made to the holders of first preferred stock in Uultlbestos Company by which they will receive Class A preferred stock of the Dewey and Almy Chemical Company in part payment for their first preferred stock in Multibestos Company, I submit the following information in con nection with the Dewey and Almy Chemical Company. I The Dewey and Almy Chemical Company was incorporated under the laws of Massachusetts in 1919 and has its main factory in Cambridge, Massachusetts, with branch factories at Oakland, California, and Naples, Italy. It owns the capital stock of the Dewey and Almy Chemical Company of Canada, Limited, with a factory in Famham, Quebec, and one-half of the capital stock of Darex Aktiengesellschaft fur Kautschuk Verarbeitung, a German corporation with a factory in Frankfurt am Main, Germany. f The Dewey and Almy Chemical Company has specialized in the manufacture of sealing compounds and other products used by manufacturers of tin cans and in other chemical specialties such . as soldering fluxes, adhesives, etc. used in various industries. ( Many of its products are manufactured from rubber latex and it is said to be the second largest consumer of this commodity in the United States. Its sales in 1929 were approximately $ 2,000,000 of which 24$ represented shipments to 30 countries other than the United States. It has large and specialized chemical research _ staffs both in this country and in Germany. It is now broadending its activities preparatory to manufacturing and merchandising a group of new products made from rubber latex including (1) Darex soles and heels, (2) porous rubbe* filter cloths for the chemical industry, and (3) porpus rubber storage battery separators. It owns many patents and patent rights among which are fundamental rights in connection with the manufacture of asbestos-products made with latex. There follows a consolidated, condensed balance sheet of the parent company and its Canadian Subsidiary as at December 31, 1929: Assets Cash Accounts Receivable (less reserve for doubtful Notes Receivable - employees Inventories at the lower of cost or market Cash value of life insurance -policies and prepaid expenses. $37,767.59 106,664.83 4,420.50 265,685.92 15.240.10 Total current assets $ 429,778.94 Land, buildings and equipment Durable containers. 939i140.67 13.173.04 Total fixed assets $ 952,313.71 "investment in Darex A/G (50% owned) Formulae and processes 59,858.50 60.000.00 $ 1,501,951.15 Liabilities Accounts Payable Notes Payable Accrued expenses Provision for Federal Income and State Taxes Total current liabilities $ 146,664.35 40,000.00 6,571.06 29.000.00 $ 222,235.41 Brought Forward? $ 222,235.41 Mortgage payable - secured by land Provision for durable containers In customers' hands, Total liabilities 8,200.00 7.721.00 $ 238,256.41 Provision for depreciation of fixed assets . $ 161,933.81 Capita], Preferred and Class A preferred stock, 5,500 shares Common and Class A common stock 36,730 shares Surplus $ 550,000.00 156,949.57 394.811.36 $ 1,501,951.15 Note:- The item of $ 60,000 for Formulae and processes repre sents capitalized value of original formulae and processes re ceived in return for common stock at the time of the Company's incorporation in 1919. The balance of the common stock was paid for in cash. The capital structure of the company is now: Issued Not 7% cumulative 3,500 3,500 None Class A preferred - par value $100 - 7% cumu lative 9,000 2,000 - 7,000* * Common, no par value 2,400 Class A common - no par value 37,600 2,400 34,330 None 3,270 Kidder, Peabody & Co. is committed up to December 31, 1935 to purchase this at par at the discretion of the Chemical Company's Board of Directors. The Class A preferred stock carries yearly cumula tive dividends at the rate of 7%, payable March 1st and September 1st, and is in all respects identical with the preferred stock except that it has no voting power whatever. a m, o iinn .. The Directors of the Dewey and Almy Chemical Company plan to issue in the near future 4,500 shares of the above shown unissued Class A preferred stock and to recommend to the Chemical Company stockholders increasing the dapital stock of the Company to enable it to take care of its obligations in connection with ' its offer to the stockholders of Multibestos Company and to pro vide additional working capital. follows: An analysis of earnings for the past five years 1925 1926 1927 1928 1929 Net. earnings Preferred dividends paid Common dividends paid Carried to Surplus 50,911 70,086 71,350 13,053 14,000 14,000 2,740 8,220 10,960 35,118 47,866 46,390 140,099 174,052 `20,958 .28,000 18,189 33,230 100,952 112.822 Very truly yours, DEWEY AND ALMY CHEMICAL COMPANY. BRADLEY DEWEY. President. VOTED: Upon`motion duly made and seconded it was To adjourn. O ATTEST: J. f o g ^ v T * * MINUTES OF SPECIAL MEETING OF THE BOARD OF DIRECTORS OF DEWEY AND ALUY CHEMICAL COMPANY A Special Meeting of the Board of Directors of Dewey and Almy Chemical Company was called to order at 11:30 in the morning of April 10th, 1930, at Kidder Peabody & Company, 115 Devonshire Street, Boston, Mass. There were present Messrs. Dewey, Almy, Griswold, Trumbull and Ferguson, being a majority of the Directors of the . Corporation. The President presented the foregoing Waiver of \ Notice of this meeting, which was ordered to be filed with the ) records of the Directors. Upon motion duly made and seconded it was VOTED: To dispense with the reading of the Minutes of the previous meeting. Upon motion duly made and seconded it was VOTED: To issue forthwith to Kidder Peabody & Company, under our contract with them, 4,500 shares of Class A Preferred Stock at 4 100.00 per share plus accrued dividends from March 1st. VOTED: / Upon motion duly made and seconded it was To authorize the officers of the corporation to file with the Department of Corporation and Taxations State House, Boston, Mass., whatever papers are nec essary for the issuance of 4,500 shares of Class A Preferred Stock to Kidder Peabody & Company, in ac cordance with the foregoing vote. Upon motion duly made and seconded^it was VOTED: i To approve the action of the ofridmts in making the following offer to the Stockholders of Multibestos Company: ' SPECIAL MEETING OF THE BOARD OP DIRECTORS OF DEWEY AND AUg CHEMICAL COMPANY, HELD ON WEDNESDAY, DECEMBER 3rd, 1930 AT FOUR 0*CLOCK IN THE AFTERNOON AT THE OFFICE OF THE CORPORATION, B35 HARVEY STREET. NORTH CAMBRIDGE. MASS.;___________________________ A Special Meeting of the Board of Directors of Dewey and Almy Chenical Company, notice of which was mailed to each Director on November 29th, 1930, was called to order at fonr o'clock in the afternoon of December 3rd, 1930 at the office of the corporation, 35 Harvey Street, North Cambridge, Mass. There were present Messrs. Dewey, Almy, Griswold, Lawton, Walker and Ferguson, being a majority of the Directors. Upon motion duly made and seconded, it was VOTED: To dispense with the reading of the minutes of the previous meeting. The President brought up for discussion the advisa- . bility of appropriating money at this time for additional Plant Facilities and the advisability of the issuance of Five Year Convertible Notes. During the discussion he presented a summary of 'wiwnw estimates of expenditures for fixed assets (dated November 13, 1930) and probable balance sheet as of March 1st, 1931, based upon the spending of $ 250,000 for fixed assets and the borrowing of $ 200,000 by an issue of five year convertible notes. He recommended that the company sell a minimum of $ 200,000 of a total $ 500,000 authorized issue of such notes, and that the ootes be substantially in accordance with a proof copy of an indenture with the Kidder, Peabody Trust Company, of which he submitted a copy for inspection and discussion The President stated that he had received tentative assurances of subscriptions ifir $ 145,000 worth of such notes and that he thought it would be advisable to sell considerably more than $ 200,000 worth of the total | 500,000 issue (and necessary to sell more if dividends were to be paid on Preferred stock on March 1st, 1931). In view of these assurances, he felt it was safe for the company to rely upon selling a minimum of # 55,000 to stockholders and to other people, and to proceed with the expenditure of $ 250,000 for Plant and Equipment for the parent and subsidiary companies. * 2Q6 . VOTED* VOTED: Upon notion duly made and seconded. It.was ' To approve the action of the officers In' having spent approximately g 266,000 from January !., I960 to September 30* 1930 for Plant and Equipment for tthe parent and subsidiary companies, (the. ap propriations for the major part of which have al ready been authorized) and to authorize and approve an expenditure by the officers of approximately $ 50,000 between October 1, 1930 and March 1, 1931 for additional Plant and Equipment facilities for the parent company and Its subsidiaries. Upon motion duly made and seconded. It was That the Clerk be directed to mall to each Stockholder the following call, dated December 4th, 1930, for a Special Meeting' of the Stockholders to be held on December lth, 1930: N0XIE_0 SPECIAL MEETING 2P_SX0KH0LDERS To the Stockholders of Dewey and Alaqr Chemical Company: ( Sou are hereby notified that a special meeting of the stockholders of the corporation will be held at the company?s offici 35 Harvey Street, Cambridge, Mass*, on December 1,,1930, at four o'clock In the afternoon for the following purposes* 1. To determine whether the stockholders will authorize the Board of Directors to Issue Five Tear Convertible 6JC Note: of the corporation to an aggregate principal amount not exceeding g 500,000, for such consideration or consider ations, as it may deem expedient, such notes to be sub ject to the terms of an Indenture to be dated as of Jan uary 1, 1931, providing*-among other things, for the con version of said notes Into Class A cohmon shares of the - corporation at a basic price of g 60.00 a share, subject equitable adjustment of such conversion price In certain contingencies; and to determine whetbr the-stockholders will authorize the Board of Directors to fix and deteraln the terms of such Indenture, and the price at which the notes may be called and to authorize the execution and delivery of the same. 2. To determine"whether the stockholders will vote to Increase the authorized capital stock of the corporation by Increasing the authorized number of Class A common shares without par value from 40,156 to 50,000. -I* 3500* > l o 207 3. To determine whether the stockholders will vote to authorize the Board of Directors,. without necessarily first offering such Increased stock to any present or future stockholders for-subscrlption, to determine the terms and manner of the disposition of the same and par ticularly from time to time to Issue, shares of such in creased stock In connection with the conversion of the Five Iear Convertible Q% Notes of the corporation, in accordance with the provisions for conversion. 4. To determine whether the stockholders will vote to amende the first sentence of Section 1 of Article II of the ByLaws, which now reads: "The number of directors shall not be less than five nor more than nine", to read: "The number of directors shall not be less than five nor more than fifteen". 5. To elect one or more additional directors. 6. To determine whether the stockholders will vote to amend Article II of the By-Laws by adding thereto an additional Section 5 as follows: Section 5. Executive Committee. The Board of Directors may elect from their own number an executive committee of i less than three nor more than five members, which committee may be vested with the management of the current and ordini business of the corporation. Including the fixing and alte: ing of the powers and duties and appointment of, and the filling of vacancies among the subordinate officers and th< agents of the corporation, the appointment of additional officers and agents, and with power to authorize purchases, sales, contracts, offers, conveyances, transfers, and negotiable Instruments and other specific duties which may be vested in it from time to time by the Board of Directors. A majority of the executive committee shall constitute a quorum for the transactions of business. The executive committee shall report its action to the Board of Directors. The Board of Directors shall have power to rescind any vote or resolution of the executive committee but not with retroactive effect. 7. To transact any other business that may properly come before the meeting. Please sign and return in the enclosed stamped envelope the enclosed proxy which'will be voted In favor of the above unless con trary instructions. are received or unless you are present in person. December 4, 1930 CHARLES 1SNX, Jr. Clerk. Upon motion duly made and seconded, it was _( VOTED: To authorize the officers upon approval of counsel (provided the stockholders authorize the increase of capital stock in accordance with the foregoing) to fix the price at which such notes shall be offered for sale, to determine the date on which subscriptions will close, the date or dates for payments of sub scriptions, the form of subscription blanks, the form-of notes, and other details in connection with the Issuance of these notes. VOTED: Upon motion duly made and seconded, it was That the President be instructed to mall to each stockholder with the Call for the Special Meeting of stockholders the following letter dated December 4th, 1930, entitled "Comments on Call for Special Meeting*. 0SMpIS_0H AIA_FR_SPEIL_ME5riSG_ To the Stockholders of Dewey and Alay Chemical Company: Enclosed is a formal notice of' call for a special meeting of ^ stockholders to be held on December 12, 1930 for the purpose of authorizing additional Class A common stock in connection with an issue of convertible notes and for the other purposes set forth in such notice. The Directors consider the sale of convertible notes at this time desirable in order that the development by this Company of the Multlbestos Company may be completed without delay. On May 7th of this year, your Company purchased all but a few shares of the stock of the Multlbestos Company. Since that time, the organization or the Multlbestos Company has been revamped; its plant has been overhauled, rewired and remotorlzed and its physical condition improved; and its inventories have been repriced td ^ _ conservative and proper values and slow moving and obsolete sterns written off. Its sales force has not only been reorganized but in addition has been strengthened by turning over to it certain men from the parent Company. Mr. Mason T. Rogers as Vice President and Sales Manager of the Multlbestos Company is now in charge of this force. Mr. Rogers before joining the organization, had*been for the last 15 years associated with the automotive industry and resigned as President of the Burton & Rogers Manufacturing Company to accept this position. To head the Detroit organization he has secured Mr. H. B. Smith who thought so well of the new Multlbestos ( lines that he resigned from the position of Sales Manager of the ~ Battery Department of the United Motors Service (a subsidiary of General Motors Company). This reorganized sales force is already \ 20 > *5 *5 * functioning and has obtained many new desirable jobber accounts, some of which are in large consuming territories In which the Hultlbestos Company formerly had no sales outlet. The research organization of your Company has devoted the major portion of Its effort during the last nine months to the development of Improved merchandise for the lfultibestos Company. As a result of this work and based on a large volume of sales and enthusiastic consumer acceptance, your officers are convinced that lfultibestos LX Flexible Moulded Brake Lining is now the outstanding lining for the replacement trade. They also feel that Hultlbestos LX and BR Clutch Facings excel anything now on the market and that LX Rigid Segment Brake Linings and Brake Blocks bring to the equip ment field superior rigid linings. The opportunity for lfultibestos jobbers to sell a high-grade brake block for the relining of large busses and trucks will not only increase the volume of business done by the Company but will also increase the value of the Hultlbestos franchise to Its jobbers. All of these products have been made by typical full scale production units and we have reason to feel confident that their manufacturing costs are lower than those of competitive merchandise. In accordance with the fixed policies of your Company, the experimental, engineering, and patent work incident to the develop ment of these lines in so short a period has not been capitalized. This heavy expense was met at a time when equipment business (as distinguished from replacement business) in former- Hultlbestos lines was tremendously'Curtailed by the reduction in the schedules of automobile manufacturers as well as by the drift"of the industry to new types of merchandise which the Hultlbestos Company was not ,, in a position to offer during the period of spring buying. During this period there were also heavy expenses of initial ^ sales and advertising programs incident to the Introduction of Darex Soles. These Soles have already been accepted by several manufacturers of high-grade shoeBboth for men and women and are being featured by leading retailers such as Best & Company, Aber crombie Ss Fitch, etc. Hade from Latex bonded felted fibers, Darex Soles combine the, advantages of leather and rubber soles and have not their disadvantages* They are waterproof, slip-proof, and non-marking. Although pliable, they will not warp or spread or deteriorate with age. `Though they wear as long or longer than even the bast grades of leather, they are exceedingly light and resilient, thus decreasing fatigue, and since they are non-con ductors of heat and cold they help to keep the feet cool in summer and warm in winter. Although high-priced soles intended primarily only,for a high-grade shoe, we feel confident that they will be widely accepted during 1931.and that we will do a large volume of business in them in subsequent years. Sales of former standard Dewey and' Almy Chemical Company lines In 1930 irl^l be within about $ 60,000 of the sales of 1929, a drop of approximately 3Jt. This Is a satisfactory showing In a -- period of general depression. In spite of this record of sales, the operations for tne combined companies will show a substantial net loss because of the heavy experimental and development expense already described. ( By expediting the program upon which we are already em barked and enlarging our facilities sufficiently to take care of available business, your officers, after a most careful analysis of sales and expense budgets, feel assured of a net profit of more than $ 400,000 In 1931, with Increasing profits in succeeding years. Consequently, to successfully capitalise the opportunities now available, your Directors recommend the creation and sale at* this time of an issue of Five fear Convertible 6% Notes carrying a privilege of conversion into Class A common stock. The proceeds from such a note issue will be used to replace both the working capital which has been spent in the development of the new lines and that which.must be spent to complete new facilities necessary for the productionvpf>these lines in volume sufficient to meet sales"eStlaates fdr 1931. * ( These notes are being issued on a basis attractive to purchasers and therefore present stockholders are offered an oppor tunity to share in their purchase. (See enclosed subscription form.) The indenture covering them has been prepared and arrange ments can be made for those interested to inspect it.' In general, its terms provide for (1) interest at 6%, payable January first and July first; (2) conversion at any time during the life of the issue into Class A Common stock at % 60 per share; (3) call by the Company at 107 any time before January 1st, 1933, at*103 between then . and July 1st, 1933, and at par between then and January 1, 1936 wheh the notes come due; (4) no mortgage to be placed on the Company *s * properties without the notes being equally protected; (5) provisions for the equitable adjustment of the conversion price in the event of issue of new stock which changes the cohversion figure by more than three dollars. ^ ^ hoped-fogt 79h will bg. prgg.CB3L At tftg PfiflfrLflg, yotfiJ...bHt lf-you are unable to do so you are urged to execute the engipAtd proxy and to return it In the accompanying envelope. December 4, 1930. Tours very tru lyj,.. iis BRADLSZ DSffEZ, President. <0 JT>- Ti- Tt 7^ VOTED: VOTED: Upon motion duly made and seconded, it was To authorise Bradley Dewey as President and/or Charles Alay, Jr. as Vice President and Hugh 8. Ferguson as Secretary and/or H. B. Canfield as Assistant Secretary upon approval of counsel (provided the stockholders authorize the Increase of capital stock in accordance with the foregoing Call) to execute the Indenture of Trust substantially in the form presented to the meeting. Upon motion duly made and seconded, it was To adjourn. ATTEST: