New-York tribune., 1909-02-14
GRANT ERIE BOND ISSUE
y s. COMMISSION act.
REQ 900 900 for Taking Up Coupons,
Refunding and Improvements.
rBy Telegraph to The Trlbune-I ]

rEsy Telegraph The Tribune
-,- Feb 1S-The Public Service Commission
I,Ir+ric; has granted the application of the Erie
= - Company for authority 10 issue $50. .00O,
- sr value collateral trust per cent gold bonds
.r-4ng in thirty years The decision was made
% divided commission. Messrs- Decker, Sague
. olrnsted voting in the affirmative. and Messrs.
s,s and Osborne IN the negative
-TtIs decision marks one Of the most important
= -,ost trying cases the commission has had TO
% ~ 3 as two years of existence. Hearings have
So So ssfd and investigation conducted by the COM
re- .o- 20 get every possible bit of light the
Ls.-+ because il was considered generally here
-. she turning down Of this application for the
- issue would be fraught with grave conse-
'- 90. for the railroad; while. on the other hand,
'z,csal affairs were IN such shape that the
- ~ such an amount OF bonds under improper
+~,-+ions might cause grave harm to the inter
.+s If great number OF people
- conditions under which the issue is authorized
est forth by the commission in a statement In
rzrt ss follows:
rsauirenent is made that q collateral trust In
.nrrs be prepared and submitted TO the commits
ton to ns ne sgthorized are 80 he used-sl1 900
,or tie refundng OF IKE amount OF interest @ bo 0O9
po5 ~ conpany's per cent conyertiole hfty-year
gold bonds& & 1ssIy1 1se9rs Thereafter requirement is
ps5s .hat an amount be taken from income every
81 sxmsarsi during that period and set aside during
The period o. ssroyements s ana additions; the in
bsi-e that the end OF the flVe-year period an
snnous- us-sTded from the income upon the companys
gepeTs Ten million flve hundred thousano san 1oi-
sTs e. +e-s value notes issue of 81. 100000
hcsTsssed e 4g te nensinder Of the bonds authorized
nav be used subject 10 retrlteTs s7a mace s IN f tbe
dtr Snq qre The proceeds to be applied 20 the cost
Il improvements ana a9qisos m 10 n tie orse ~ con-
+3cSior for its use and operation as part OF lts
e application Of the ceIapany was received s- by
beT5
The purposes Of the issue and the appica-
, of The procee5s thereof was made by the COM
nission. - ,.--,. 49,, 80,
- .,-5s +fe Fries representative stated TO the
commission that il was the Intention OF 'he com
- n the event OF favorable action on It's ap-
1-+io- ~ make improvements in terminals. car
engine shops. eliminate grade crossings nullo
sSditional tracks sldlngS aIo us tir mes nsle
seT +o-iay's order the company Is required 70
make {on md nd operations every six months Thirty
5svs are given me company Al winch - ~ 49,
ce1tarce Of the order
-, .c,ion Of the Public Service Commission IN
80 The application nade by the Erie Railroad
- ,n November for permission 10 issue $SO-
sneo bonds for funding existing Obligations ana
s.sF ,oorry for further betterTnents, is expect
= . 1-5 favorable reflection in the stock market
>, ,.s reopening tomorrow morning A1ter 'i'e
.b-ss-5sv holiday. Cor there has been much uncer-
,I,,1 in the mind of Wall Street as to the prob
RI
-. issue not destined for providing funds for I'M
movement work.
f.eorre F. BrovnelL vice-president and general
counsel Of the Erie road, who represented the COM
many at the initial hearing before the commission
last fall On the bond application. said yesterday
that he had not yet received official copy OF the
commissions order, but that. assuming tho cor
RICHNESS Of the published report. there would be no
obetaclc 20 the conpanys issuing the bonds Es-
se-tiaily The company required 10 put into the
property every six months during the next five
years an amount equal 10 the interest which had
accrued during the six months en- the general lien
bonds and general mortgage convertible bonds. the
coupons representing which interest would be re-
funded IN new bonds. AS 70 whether not the
company would be able TO put these sums into the
property. answer might be found IN the fact
that In the last five years there had been expended
slsoeop4 which had not been capitalized. and also
that for number Of years the net corporate income
n excess Of fixed charges had been upward Of
$4,000 year, except in the last fiscal year. when
business depression general and when the COM
paay had deficit Of a.s3.fz3- The net corporate
moons for the first six months OF the current fiscal
yesr, however. had been about 100000 over fixed
charges 80 that the outlook encouraging.
The Albany dispatch says that the coupons which
may De exchanged for new bonds those falling
cue between January !. 1908, and January /. 1913,
period Of four years, but elsewhere the commits
SONS order refers 70 'the hve-year period covered
- ~io 4uSSTeSl coupons SO anu oniy DS
assuming the period to be FIVE years the total
Of sn.s64e1o mentioned De arrived at.
Inc Erie had issue OF S5.5Ooeo0 short term
notss coming due April s. 1908. and up to within
almost the day OF maturity the directors had not
oeT1seo means Of taking care Of these obligations
Al The last moment L H Hartman offered TO buy
SSoe.eo new three-y=ar per cent collateral trust
sStek part Of issue Of SIS 10000 which has just
oesa authorized By the Public Service Comr1is
Ao1' fnis offer which was accepted by the direc-
TOTS. solving TIE problem OF provision for the
turing Issue OF like amount. Subsequently 50 co.,
es more OF the notes sold to syndicate
headed by Mr.. Hartman and J. P Morgan & Co.
<no i Is this Eo,5o00o to which reference is made
u Section OF the commissions order. which pro-
woes that new bonds 70 the amount OF $1o.500.00o
nay oe exchanged for g Ike amount OF notes In
Sune, ls6. the plan published for the purchase
oi the coupons certain classes OF the company's
oonos by J. P. Morgan Co., with the object Of
.-Sklns available for the completion OF important
Improvement work already begun funds which
oeneEFise must have been applied 10 the payment
u interest and Il announced that plan would
0eoTe long be brought out for funding the coupons
maturing On these bonds for considerable period.
SUN" ALUMNI ASSOCIATION DIMES.
Justice Joseph Z. Newburger, OF the Supreme
Nosrt one OF the speakers at the Eth annual din
ner or The Sun" Alumni Association last night at
e Hotel BrevooTt, told his associates some Of his
experiences IN 1872 g reporter, when doc" Wood
sae city editor, and he used cover all the po-
nce stations below Canal street.
Ans ether speakers included Arthur Brisbane
nno said he owed most os what he knew TO John
ooesrt who city editor when he worked
.as paper. Deacon" Amos Stiilman. who has Just
=