Motion Picture Herald (Mar-Apr 1940)

44 MOTION PICTURE HERALD April 6, 1940 STOCK PLANS FOR DISNEY, B&K, CONSOLIDATED, MONOGRAM, KEITH Twentieth Fox Lists Salaries; Pathe and General Theatres Report Profits; Columbia Declares Dividend; SEC Reports Five companies — a producer, two circuits, and a large film processing company with varied interests — drew attention in financial pages this week, with new financing arrangements or revelations of financial operations. They were Walt Disney Productions, whose first public stock issue, on Tuesday, was oversubscribed; Keith-Albee-Orpheum Corporation, whose impending recapitalization was hinted to stockholders; the Balaban and Katz Corporation circuit (a Paramount Pictures subsidiary), the remaining preferred stock of which is being retired; Monogram, with a $100,000 stock sale; and Consolidated Film Industries, Inc., whose possible recapitalization was announced at the annual stockholders' meeting, in New York, last week. Disney Underwriting Approved Officials of Walt Disney Productions announced the oversubscription on Monday. Public offering of the stock was made on Tuesday by a financing syndicate, headed by Kidder, Peabody and Company. The Securities Exchange Commission, on Monday, formally approved the $3,875,000 underwriting. The stock issue comprises 155,000 shares of six per cent cumulative, convertible preferred stock, at $25 par value, at $25 per share. Five thousand shares of this stock are being offered to the company's personnel, at par value. The rest is open to the public. The new stock may be converted into common stock at the rate of one share of common, if converted on or before April 1, 1944 ; 9/10 of a share thereafter, until April 1, 1945; 8/10, until April 1, 1946 ; 7/10 until April 1, 1947; 6/10 until April 1, 1948; one-half share, if converted after these dates. On. or before April 1, 1941, a fixed sinking fund of $50,000 will be set aside, with $100,000 on or before October 1st and April 1st. The company will also set aside, out of the excess of consolidated profits, over $500,000 of a sum equal to 20 per cent of such excess, but not exceeding $200,000 additional in any one year. Both sinking funds are to be applied to the acquisition of preferred shares, either by redemption or purchase. $1,500,000 Life Insurance A feature of the preferred stock is a provision for the insuring of Walt Disney's life, for ten years, at $1,500,000. Should he die on, or before, April 1, 1944, while any preferred stock is outstanding, the proceeds of the insurance would be put in trust for the outstanding preferred stockholders' benefit. Should he die after that date, the proceeds of the same will be taken by the company. The preferred shares can be redeemed at any time, at prices ranging from $27.50 per share through April 1, 1944, to $25 per share after April 1, 1949. After the financing, the company will have, in addition to the preferred, 355,000 shares of common stock, at $5 par value. Walt E. Disney and members of his family own all of the outstanding common stock. In the financial syndicate in the underwriting are Kidder, Peabody and Company ; Har FOX MIDWEST IN LOCAL NEWSREELS Local newsreels have been inaugurated by the Fox Midwest Theatres circuit, in its Kansas City office. Cooper Jenkins, experienced in 16 mm. camera work, will make and display the reels, working out of the office of L. E. Pope, purchasing agent, which will handle local routings. Managers are to keep the office informed of important local events. Mr. Jenkins' equipment is an Eastman special camera, and a Bell & Howell Filmo arc projection machine. riman Ripley and Company, Inc. ; Pacific Capital Corporation, and Mitchum, Tully, and Company ; William R. Staats Company ; W. E. Hutton and Company; Lee Higginson Corporation ; Graham, Parsons and Company ; Stone, and Webster, and Blodgett, Inc. ; G. M-P. Murphy and Company; Merrill Lynch and Company, Inc. ; Alex. Brown and Sons ; the Pacific Company, of California; Baker, Watts and Company ; Schwabacher and Company ; Page, Hubbard, and Asche ; Moore, Leonard, and Lynch ; and Banks, Huntley, and Company. The net income of the company (Disney) for the 12 months ended on September 30, 1939, was $1,250,130, after all charges and Federal income taxes. Keith-Albee Recapitalization In a letter to the stockholders, George J. Schaefer, president, hints that the Keith-Albee-Orpheum Corporation may be recapitalized soon. The letter, which concerned the annual meeting of the corporation, in New York, on April 10th, said, in part : "Pending the plan of recapitalization, the directors have decided that it would be advantageous to the corporation and its security holders if an opportunity were offered to preferred stockholders, to sell to the corporation certain shares of their preferred stock, at a price higher than that which has prevailed upon the New York Stock Exchange during recent months." _ If the authorization is given, the corporation's management will ask approval to purchase 3,000 shares at $100 each. If more than 3,000 shares are offered, all offers will be accepted^ pro-rata ; but if less are offered, the corporation will purchase openly, or privately, the difference, at not more than $100 per share. KAO Earnings $976,627 Radio-Keith-Orpheum Corporation owns most of the common stock. It holds 21,761 preferred shares, of the 64,304 now outstanding. Keith-Albee-Orpheum is said to have cash of $3,203,502. Its 1939 earnings were $976,627. This was equivalent to' $15.18 per share on 64,304 shares of the seven per cent cumulative preferred stock outstanding. Last Thursday, in New York federal court, Judge William Bondy awarded $7,500 to special master George W. Alger, who confirmed the RKO plan of reorganization. This was a final allowance. Previous awards to Mr. Alger, in the RKO reorganization proceedings, had totaled $34,500. Retire B. & K. Stock All remaining preferred stock in the Balaban & Katz Corporation, of Chicago, is being retired on May 31st, this year, it was announced last Wednesday. An additional bank loan recently negotiated, supplies the funds. In 1936, the directors ordered 13,061 shares retired, and advised shareholders that the remainder of the original issue of 28,476 shares would be recalled in 1939. Still out, are 12,745 shares which, plus $1.17 accrued dividends per share, will be retired on May 31st. The stock was seven per cent cumulative, with a $100 par value. The First National Bank of Chicago is the depository. Monogram Stock Sale Monogram franchise holders have arranged to acquire in excess of $100,000 worth of additional stock in the corporation, according to W. Ray Johnston, who arrived in New York from the Coast to attend a Monogram directors meeting Tuesday. Mr. Johnston returns to the Coast in a few days to speed up production on the 11 remaining features of the current season and to complete plans for the franchise holders' sales convention at the Baker hotel in Dallas, April 21st and 22nd following the Variety Club convention on April 18th to 20th, which all Monogram officials and distributors also plan to attend. More 'top-bracket' pictures are planned for 1940-41 season, according to Mr. Johnston, and eight additional westerns to be produced by George W. Weeks will probably be included in the program. The contemplated program at present planned is 50 pictures, consisting of 26 features and 24 westerns, final details of which will be announced at the Dallas meeting. Attending the board meeting Tuesday were O. Henry Briggs, J. A. Sisto, Thomas P. Loach, William B. Jaffe,. Samuel Broidy, John Mangham, and W. Ray Johnston. Colonel T. C. Davis was elected a director. Mr. Davis is an officer of Standard Statistics Corporation. Three More Companies' Finances Disclosed Twentieth Century-Fox Film Corporation reJ" vealed its officers and directors' salaries through a proxy statement to the stockholders through the New York Stock Exchange ; Pathe Film Corporation's financial statement disclosed a $424,489 net profit in 1939; General Theatres Equipment Corporation stated that it earned," net, $696,062 in 1939, in its annual . report to the stockholders ; and the Securities Exchange I Commission summary of stock dealings for Feb ' ruary, issued Friday, revealed heaviest film stock transactions in Pathe film. The Fox report disclosed $853,943 as aggregate compensation to officers and directors of the company, last year. To officers, for services, $831,693 was paid; to directors, for attendance fees and as compensation for serving on board committees, $22,250. The total amount does not include $1,967 to Hayden, Stone and Company, of which John R. Dillon, a director, is a member. This payment was for brokerage fees. The total, also, does not include any amounts {Continued on page 46)