The Jersey City news., 1902-11-14
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FIGHTING THE
MERCER
Prudential : Fidelity Trust
Scheme Before Vice
Chancellor Steven
son Today.
COMPLAINANTS OPEN CASE
Contend That the Plan Was
Secretly Carried Out With
out knowledge of
Stockholders.

today the suit to enJolu the EruuehtIai-
Fidelity Trust Companies merger
brought by W. Rowbotham and ]. Hing
worth, stockholders of the Prudential
Company, who assert that the directors
have no right to vote on the companys
holdings in the Fidelity Company to in
crease its capital from 81, 100000 to
$3,000,000.
Last Monday the return of the rule
to show cause was returnable, but the
Vice-C Chancellor laid the matter over un-
til this morning, directing that each side
should exchange the veluminous papers
in the case, and in the meantime the
Court would read the petition and an
swer, so as to master the details Of the
scheme. As on Monday, there was
gathering of men eminent in the financial
and legal world. United States Senator
John f. Dryden, of the Prudential; Uzal.
H. McCarter, president Of the Fidelity,
and others interested were in the rear
seats of the Courts For the complainants
appeared Lawyers r. J. Lindabury, John
r. Hardin and Sherrard Depue. For
the defendant, eorpurations:Ex United
States Attorney General John w. Griggs,
Attorney General of the State Thomas
N. McCarter and his brother, Robert Nc
Carter and Charles L. Corbin.
REBUTTING AFFIDAVITS.
The proceedings opened by Mr.. Lin
dabury offering affidavits of Frederick L.
Cutting, Commissioner of Insurance of
Massachusetts and from Connecticut, re
bdtting the statement of William BEETLE,
Commissioner of Banking and Insurance
in this State, who was quoted in SEN
ator Dryden's attidavit filed last Mon
day.
Counsel for the companies opposed
these affidayits as irrelevant, but the
Vice Chancellor admitted them.
Mr.. Lindabury read an affidavit from
Commissioner Cutting declaring that the
plan of the merger had been before
him by Senator Dryden, who desired
his opinion on it Other affidavits were
submitted to the effect that the plan was
an excellent one from business point
and to the benefit of all the Prudential
stockholders.
Mr.. Robert McCarter objected to the
admissability of the afidavits, but was
overruled.
HISTORY OF THE COMPANIES.
Mr.. John W. Hardin, for the COM
plainants, began his opening argument
with the statement that the companies
We're companies of quasi business
character and only discharge public
functions in a certain way. They were
under State supervision in a special way.
Counsel then proceeded to relate the his
tory of the Prudential, originally called
Widows and Orphans Friendly Society.
1t was Incorporated, he said, with a capi-
tai stock of $25,000, with privilege to in
crease it to 100000. Subsequently by
acts of the Legislature it had further
powers conferred it. Then turning tc
the Fidelity Trust Company, he traced
its history. it was created by charter
in 1875. Its original name was New
Jersey Trust and Loan Company. Its
authorized capital was $150,000 The
stock was from time TO time increased
that at the present time it has 10000
shares divided into $50 of $1,000 each
and has today surplus Of $3,500,000
PLAN OF THE MERGER.
Mr.. Hardin continued by describing
the interchange plan, or merger. He read
Senator Dryden's letter to- the field and
home staff, of the company, issued Octo-
Der 81, 1902, which said
As has been known for several days,
sthe capital of the Fidelity Trust Co. is
about to be increased from 81, 100000 to
100000, the new stock being sold at
$3.50 a share. This will result in giving
the Fidelity Trust Co. a capital stock. of
$3.000,000, a surplus of $13,000,000 and
considerable amount of undivided
profits, making this company from the
standpoint of capital and surplus as
large, if not larger, than any similar in
stitution in the country. Sufficient of
this new stock will be taken by the Pru-
Dental Company TO give it. together with
its present very large holdings of Fidel-
ity stock, the absolute control of that
company. A very large portion of the
balance of the stock is to be taken by
the Equitable Life Assurance Society of
New York, which will give to that COM
pany a very substantial interest in the