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186 [[underlined]] which would give me control of company in case the 4-6 director rule in the Bye-laws [[strikethrough]] if [[/strikethrough]] is ever changed [[/underlined]] Told Schleussner that according to my calculations the [[underlined]] stock is not worth more than 277$ [[/underlined]] if we have [[underlined]] 1/2 million net earnings [[/underlined]] and [[underlined]] 477$ if we have 1 million [[/underlined]] earnings above interest received from invested capital. My reasoning is as follows: Book value as of May 1, 27 = 277 Made up as follows: cash and securities = 177 Other physical assets mainly equipment + land & buildings 100 ------ Total 277 Told him our cash and securities were only [[underlined]] temporary assets [[/underlined]] and shall have to be used for [[underlined]] increased industrial [[/underlined]] equipment here and abroad [[underlined]] also for banking [[/underlined]] our customers. So its present earnings of [[underlined]] about 4% [[/underlined]] should not be counted in our considerations of good will or industrial operations. If we make an average net profit of [[underlined]] $500000 yearly, [[/underlined]] capitalized at 10% this would mean about: [[end page]] [[start page]] 187 150 per share 177 for cash and securities ----- 327$ per share ----- If we make average of one million annually it becomes: 300 + 177 = 477$ Calculating separately 4% from securities = 178$ value If I pay 400$ per share - 178$ cash and securities ------ 222$ net cost per share $240000 interest 4% 500000 from industrial operations -------- $760000 annual net total about -------- = 20% on stock. 35680 shares costing 400$ = 5% on investment But if [[strikethrough]] 4 [[/strikethrough]] 240000 interest is omitted then 500000 -------- 35680 = 14% and if payed $400 per share it means only about 6% on money paid outside cash value of securities If we make about one million net per year, it will mean about 30% [[strikethrough]] dividens [[/strikethrough]] earnings but if stock is sold at 400 it will only mean about 7%, which is not much for a risky industrial enterprise.