An extraordinary general meeting of shareholders in the E-we Cotton Spinning and Weaving Ca., Ld., was held at the office of the general managers, Messrs. Jardine, Matheson & Ca., on Monday afternoon. "Present:—Messrs. E. F. Alford (Chairman), A. McLeod, J. Prentice, Zee Ti-san (Directors), C. Dowdall (the Comppany's Tegal a P. H. Arnhold, A.
Howe, A. K. Craddock, R. H. Burder, A.W. Danforth, J. Paterson, C. E. Anton, G. J. Morrison, W. ©. Murray, J. Mac kenzie, J. M. Young, W. A. Cruickshank, E. Evans, J. D, Clark, A. Shearer, and 'Tong Kid-son, representing in all 3,807 shares. After the notice convening' the meeting had been read by the Secretary, the Chairman said GensLeex,—This meeting being now duly constituted I purpose before submitting to your decision the resolutions which have been circulated amongst you, to offer few preliminary or explanatory remarks which may not be without interest to thus who hi investment in this Conipany's shares have shown their confidence in the enterprise.
The original prospectus provided, as you are aware, for a mill to contain 40,000 spindles, but upon the arrival of our mill master, Mr. Kerfoot, he pointed out that the mill buildings had been planned on 80 liberal a scale that we could find space for 10,000 more spindles. It is self evident that this increase of 25 per cent. in the power of production was an advantage it was our duty to avail ourselves of without delay, and: the necessary steps have been taken to that end. These 10,000 extra spindles were, of course, not contemplated in the original: provision or capital, and their lus an excess over estimates for buildings (due mainly to the fact that four mills were being built at the same time) will bring the ded Property, Machinery end Building accounts up to a million and a quarter taels, this amount, however, about two lakhs are
and Offices, which will serve as' well for represented' by Land, Godowns, Houses now had our first six months' experience of Cotton Spinning'in China, I am glad to feel justified in bringing before you the necessary resolutions for that increase in our productive power.
The past six months have, as you can all well understand, been a period of initia. tion and necessarily of many difficulties, which with past experience will, it is hoped, in future be avoided. We commenced on May 10th with 4,000 spindles, which by degrees have been added to until now we have 25,000 running day and night. The average number for the period has been slightly over 13,000, and when I tell you that we purpose closing the accounts on the lst of this month, and with the aid of interest on capital account, shall be in a position to recommend the payment of a dividend at the rate of 7 or 8 per cent per annum, you will, I think, admit that our labour has not been in vain, and 7 that there is visible evidence in justification of our faith in the industry. As already stated, we have now 25,000 spindles running; we have 3,000 more erected and ready to start and hope to have the remaining 20,000 out in January, but the regrettable strike in the Engineering Trade at home may cause some delay as to the Latter, and with respect tothe 3,000 spindles erected but not at the moment running they need not, I think, occasion you anxiety—the fact that the increase in spindles has been more rapid than the increase in labour. I am not alarmed at this; time will cure it and you will, think, agree with me if youbearin hind that already some 70 to 80,000 spindles are being run by people who, a yea ago, knew nothing of such work, and when you also consider the enormous increase in the cue borage Factories——during the past few years successful ed through similar experiences... We need not fear; supply of labour will surely overtake demand, and excess of supply will not onl; be an incentive to skill but a reliable ched on an excessive wage.
From what I have said, and also by our action in connection with the proposals now to be put before you, we have evidenced our opinion of the future, and holding that opinion we are desirous of saving time in. starting the extension recommended. It is to save time, and time is money, that we have called this meeting, for if you agree to the resolutions we hope to avail ourselves of the coming winter to get on with the ground work and foundations of the new mill, and the sooner that is done the sooner shall we be ready for the additional machinery.
In fixing the 31st of December next as the date on which the Register of Shareholders List of those entitled to the new. sllitmens, will be closed for the making up of the
we have selected a date which will permit of applications fur the same being sent in after the Chinese New Year, thus entailing no call whatever for funds until the native settlement is over, and even then for but a very small sum.
With respect to finance the resolutions seem clear and little more need be said. The present mill of 50,000 spindles will cost complete a million and a quarter, and we expect to save some two lakhs on the extension; we have thus to provide for a total expenditure of something like two and a quarter million taels, or say £285,000 when rendered in sterling. The calls on the new shares will be Tls. 10 on application and Tls. 15 on allotment, whilst the other Tls. 75 per share is only leviable shen required in calls of Tls. 25 per share at intervals of 2 mouths. So far as we can see these funds will suffice for.the greater part of next year, and the Debentures will not be necessary until we come to paynients for Of machinery. There is no intention of issuing these Debentures en bloc; the money will only be required from time to time, and ye anticipate no difficulty in finding outlets, as occasion may e, for these securities. This mode of finance will, we Velieve, prove the most economical and efficient, and in order that Debenture holders may be in the soundest legal position,
residents to act as Trustees. Iam glad to we purpose inviting two well-known local say that Mr. W. D. Little and Mr. Dowdall are prepared to accept the position of Trastees; and you will, Tam sure, be very pleased to welcome Mr, Alex. McLood, who has kindly consented to fill the seat on the B vacated by Mr. Adler on his leaving for Europe. I have dealt now with every point of interest which occurs to me, though. before putting the resolutions to the meeting, I will endeavour to answer any questions bearing on the resolutions should anyone desire further information.
Mr. Ph. Arnhold said that before the resolutions were passed, he thought it would be better for them to make sure that cotton spinning in Shanghai would be a success. He also thought that the General Managers' commission, even cent, was excessive, and went into detailed figures to prove his contention. He moved that the meeting be adjourned until the Directors could put figures before the shareholders to show that the cotton spinning industry was likely to prove a success.
In reply, the Chairman said:—I am very pleased to find that Me. Arnhold at least agrees with me as to the prospects of the industry. As to postponing the extensions until we show figures I have already said we intend to close the accounts to the 3tst of this month and then to hold a meeting, and as we are compelled " hold a meeting confirmatory to this one, share+ holders will see what the position is from our accounts before the confirmatory mect+ ing is held. We wish the resolutions passed now s0 as to enable us to proceed with the groundwork of the extension during the winter months, and to get on with the buildings before others take similar steps or new mills ate started, which might again create the building difficulties of lust spring. As to commissions, my predecessor in the chair stated the policy of our firm when he said the Company would always be treated with consideration, and the fact of passing the resolution as' to commission does not preclude us from continuing the same practice in case of necessity. If no one desires to second Mr. Arnhold's amendment I will now put the resolutions.
As Mr. Arhold was unable to find a seconder, the Chairman proceeded to put the resolutions to the meeting.
Proposed by Mr. E. F. Alford, seconded by Mr. J. Prentice That the Capital of the Company be in. creased to Tls. 1,750,000 by the creation of 7,500 New Shares of Tls. 100 each and that the Memorandum and Articles of Association of the Company be modified accordingly.
Carried, with one dissentient.
Proposed by Mr. E. F. Alford, seconded by Mr. A. McLeod That 5,000 of the New Shares be issued sub test to the following terms and conditions; that the remaining 2,500 Shares be held in reserve for issue at such time as tha Company in General Meeting may approve {a)—One New Share shall be offered at par to the holder, on a date to be fixed by the General Managers, of every Two Old Shares. pprocedting clause shall be dispel of by the (.)—Any shares not taken up under the General Managers, with the approval of the Committee, on such terms as they may think proper.
(c.)J—Tls. 10 per Share shall be paid on Share on allotment; and the balance due in application and a further sum of Tls. 15 per respect of each Share shall be paid in inatalments of 25 each upon not less than months notice of Call.
Text read from the printed page and cleaned; old type leaves the occasional error.