The Montgomery advertiser., 1902-04-26
STEEL TRUSTS STOCK.
Circular Outlining the Plans for the
 IncreaSs-

| New York. April 25.-Stockholders of the United States Steel corporation re-
 ceived today the circular letter of the cor roration setting forth the exact terms under which it is proposed to retire $2O0, . 000.O 900 of per cent independent stock and
 Issue $25O 00o. 900 of , per cent bonds. there by increasing the bonded debt from $S0O,- 000, 900 to $550. 900 900. Accompanying this circular was a report of the finance conl-
 mittee which sets forth in detail various
 reasons why the refunding plans should be approved. together with series of resolutions reciting how the plan Is to be carried out.
 The stockholders report signed by
 President Schwab and Chairman Gary
 says in part
 In February. 1901 various subsidiary
 companies had under contemplation and
 in many cases, actually had begun the
 construction of additions to their plants
 which in some instances would have du-
 plicated the facilities of other subsidiary companies. The aggregate of these con-
 templated expenditures were something like $50 900. Much that at the time of organization it was hoped might be ac-
 complshed in the way of avoiding waste
 full expenditure for unnecessary enlarge ment of plants has been accomplished by cooperation among the several compa- nies enabling one to utilize the facilities of the other. However. in order to finish work then already under way. cash pay ments have been made during the year to the amount of $l5, 900 900.
 1t was not possible then to determine how much of this contemplated expend- 1ture of about 50, ,00o.0 900 would have to be made nor in advance of sufficient expe- rlence would 1t have been wise to capi- talize any part of the sl5, 5,oo0, 600 that have been actually expended. Within the next few months will fall due payments az gregating about $10,000. 900 for properties purchased almost Immediately after your corporation was organized. The finance committee is unanimously in support of the executive committees recommenda- ton asd believes that as desired by the executive committee. $25, GOO should be made available for Improvements.
 The finance committee also recommends capitalizing both the $l5 1000 expended during the year for commitments made prior to your eorporation's organization and the 900 vet to be paid for prop critics as above stated These three pur poses in the aggregate call for sJO,OOOOOO. The problem confronting the finance com mlttee has been to make provision for this $50 0o0.000 without issuing preferred stock. which stock can not be sold at less than par and which if sold at par would be entitled to dividends at the rate of : per cent and would increase by $3.000,0oO the present annual dividend requirements Of the corporation.
 After discussion with some of the pri1 cipal stockholders 1t appeared practicable to re-arrange your corporations capital ization (which 1 in round numbers .no mn Sw oCU of preferred stock and $500. .OO0, 900 of com mon stock by substituting for $9OO OOO. 900 of the preferred stock $20O 0O0, 900 of sinking fund sixty-year 5 per cent mortgage gold | bonds and by selling $50. O00. 600 additional | bonds of such issue for cash. As the | preferred stock carries per cent divi- | dends whi,e the bonds would bear but , | per cent interest the 1000 deferred | couId in this way be added to the corpo- | rate resources and the aggregate of the | annual charges for interest and dividends | in stead of being increased g 800, 900 would l hn decreased si. .5O0000 as compared with the present sum total of these two re- quirements.
 The unanimous conclusion or the hnance and executive committees is that consid- erinR the vast aggregate value of the physical properties the proposed S250, ,o0o. l1n increase of bonds from BOO 000 10 S5S0 oo0.ono is wise and conservative the preferred stock being simultaneously de.