The Washington times., 1903-02-01
Pennsylvania to Allow Hold
ers OF Convertible Bonds
to Convert Them Into
Stock at the Rate of $40
Per Share.

NEW YORK. Jan. 31-A half days
business on the stock exchange in which
transactions in the stocks actively dealt
in averaged only a few thousand shares
in each instance, in which the quota
lions OF many stocks did not change.
and the quotations of few of them
changed more than quarter of q point
does not call for much critical comment
Commission houses were practically
deserted today, and a large share Of the
room trading element did not put in an
appearance.
The movement Of only one stock at
tracted any attention. namely. the rise
in Delaware and Hudson. The stock
was eagerly though not largely bought.
as was the case yesterday. and gossip
in some quarters connected the advance
with the recent strength OF the Erie
shares A better reason IS probably The
conviction Of many investors that in
view Of the prosperity Of the coal bust
ness. present and prospective. the DeIa-
ware and Hudson shares are selling too
low as compared with those of the other
coal railroads.
Fears Of q railroad strike on the
Union Pacific system pretty well peter
ed out and traders displayed q desire
to get back the Union Pacific and South
ern Pacific shares that they sold yes
terday. The directors Of the Northern
Pacific Railroad announced the decIara-
ton Of the regular quarterly dividend
Of IL per cent and an extra dividend Of
y per cent upon the common stock.
The bank statement was good. Loans
increased $4,000, 500, but the deposits
increased SIS. 966. 500. The total deposits
of the clearing house institutions there
fore now amount to more than 81. 900
600 over and above outstanding HabiIi-
ties. and II is evident that the tendency
OF deposits TO increase faster than
loans still powerfully continues The
cash held b. the banks increased
$780,, 500 in the week and the surplus
reserve thus increased 81, 465, 500.
The most important news OF the day
was not made public until after the
close OF business, and the great majority
OF those interested IN the stock market
viii probably not be aware of it until
they read the newspapers tomorrow
morning
The directors Of the Pennsylvania
Railroad. al q meeting held in Phila-
delphia at noon, adopted q resolution
permitting holders OF the $50. 000. 600 80
per cent convertible bonds issued last
year, to convert their bonds into stock
at the rate OF $40 per share, between
March 10 and April Of the present year.
According to the wording OF the bonds.
holders thereof have the right TO con
vert them on and after May 1, 1904, and
the permission now accorded 10 the
bondhoIders to make the conversion this
year does not, of course, infringe upon
the right Of conversion as stated in the
bonds
The action OF the Pennsylvania di-
rectors is entirely in consonance with
the just and high-minded traditions of
the Pennsylvania management When
the bond issue in question was made in
November Of last year there was no talk
OF increasing the capital stock Of the
Pennsylvania Railroad Company.
As 31z per cent bond fat. the new is
sue could hardly be expected TO sell
above q or es- The power to convert
the bonds into stock. however. eighteen
months from the date OF their issue
obviously increased their value. but this
value was determined by the amount Of
the Pennsylvania capital stock then out
standing.
The proposition, thus, which viii soon
be submitted 10 the stockholders Of the
road and viii undoubtedly be favorabIy
voted upon, TO practically double the
cOmpany's capital issue, savored of
moral. although by no means OF legal,
injustice to those who subscribed last
November for the convertible bonds.
Therefore. the permission accorded TO
these bondholders 10 convert their bonds
into stock this spring makes up 10 them
whatever loss they would otherwise sus-
tain by reason OF the increase in the
Pennsylvania , capital stock.
The value OF the convertible bonds IS.
Of course, considerably enhanced by this
action beyond t0day's market quotations.
New York Stock Exchange, Jan. 81.
High Low last Gigs.