The Jersey City news., 1899-03-11
TO UNDERWRITE BONDS
Syndicate Formed To Buy
Securities Of Big Elec-
trio Combine.

| A syndicate is being formed, it is said,
| to underwrite the new bonds which the
| United Electric Company of New Jersey
| proposes to issue for the requirement of
| the plants, rights and franchises of the
| Peoples Light and Power Company OF
Newark, the Suburban Light, Heat and
Power Company of Elizabeth, and the
North Hudson Light, Heat and Power
| Company of Hoboken. The details of the
movement have not been worked out, but
| it is said that the Fidelity Trust Com
| pany of Newark and number of New
| York concerns will be interested in the
| syndicate.
| No intimation has been given as to the
| price which the underwriters will pay
| for the securities, but it is said that the
| syndicate will stand ready to buy all the
bonds offered for sale by stockholders who
want to unload Owners of stock in the
| Peoples Light and Power Company who
have heard of the proposed syndicate are
anxiously awaiting information about the
market value to be given to the bonds, as
the price to be fixed for the new securities
will determine the action of many stock
| holders according to the predictions of
we'll informed persons.
For instance, if an offer should be made
| to buy in tn bonds at par, it would be
| equivalent in the bonds at par, it would
be the stock Bonds at ninety-fve would
make the stock wort ha fraction more
than $50, while if the bonds should be
quoted at as low as eighty-five, the stock
would be worth between 131 and 1872. To-
days quotations for Peoples Company
stock is below that figure among local
brokers. The prevailing price asked is
125, but few sales are being made at that
figure, 1t is said.
A block of 224 shares of the stock was
sold and transferred yesterday in Newark
at 1241s and this was the lowest actual
sale reported today.
The Fidelity Trust Company of Newark
and the New Jersey Title Guarantee and
Trust Company of this city. who will act
as fiscal agents for the buying corporation
are preparing to receive the stock OF the
selling companies and give receipts for
the same In acting for the United Flee
trio Company the trust companies assume
no responsibilities other than those of or
dinary agents.
They were selected principally as
matter of convenience to stockholders, so
that there would be central points at
which the share owners could surrender
their holdings and get receipts without
going to the buyers direct.
1t has been arranged that the stock
holders of the Peoples Light and Power
Company will be accommodated by the
Fidelity Trust Company and the New
Jersey Title Guarantee and Trust Com
pany will act for the stockholders of the
Elizabeth and Hoboken concerns. The
method to be pursued has been explained
as follows
When holders of stock surrender their
certificates on or before April Is next,
they will be given receipts, which will
show that they are entitled to bonds in
an amount in accordance with the terms
of the proposition made by the new COM
bination The bonds to be issued will be
of $500 and 81, 900 denominations
Owners of less than $500 stock in the
selling companies, who accept the Offer or
those whose present holdings will not
equal $500 on the new basis of apportion-
ment. will be given scrip instead of bonds
when the latter are issued. Scrip will
also be given to the large owners Tor the
difference between multiples of $500, as,
for instance, where man is entitled TO
SIS, 400 of bonds he will be given $1,000 in
bonds and $400 in scrip.
None of the scrip will bear interest but
all will be negotiable, so after the bonds
are issued the holders of scrip will have
to buy enough scrip to make block OF
$500. which will be exchanged for bond.
If the holders cannot afford to buy they
will be forced to sell their scrip or retain
that which will net them no income on the
money invested. In this way it is expected
to retire all the scrip in a short time.
AS the New Jersey Title Guarantee and
Trust Company has been selected as trus-
tee for the United Electric Company the
collateral trust mortgage to secure the
bonds will be executed to the New Jersey
Title Guarantee and Trust Company. This
mortgage will be for $2O00o,000 and will
be given on the capital stock of the
company on the basis upon which the
several companies will be taken into the
combine
The reason given for the decision to give
a collateral trust mortgage as security, IN
stead of first mortgage, is that the for
mer can be executed by majority vote
of the stockholders, whereas direct mort
gage would require the consent of every
individual share owner, no matter how
small his interest might be.