Omaha daily bee., 1911-08-09

ferred stock of these second mortgage
bondsT And II they did not do 1t, then
the syndicate would stand ready to do so
to a reasonable extent and II we did not
get the entire 20 per cent; say for instance,
we only got 20 per cent, we would issue 20
per cent of additional bonds for whatever
stock we took up That is, II we. took up
20 per cent Of the preferred stock, or $780,
100000 we would Issue SIS 100000 of bonds in
the place OF $50, 10000.
'We thought II would be a desirable plan
in a good many ways, It would give us
S5000O,O00 OF cash without cost; IT would
wipe out these inherited improvements and
pay the Rockefeller notes. We have made
an arrangement with them TO take these
bonds in settlement OF their obligations,
which Is a good thing, OF course, and leave
us an additional sum of money that might
be used in recognising some OF the plants
and doing things that we want to have
done in Chicago and for the bridge COM
pany at Pittsburg. In this way the money
really would earn in two ways-first, in
the handling of the products between the
mills, saving in management in handling
the business and increasing the efficiency
OF the mills as to give larger output
and make more money in that way.
"Good for the StocKhO ldcrs."
"As to how the stockholders will take II,
It seems to us the preferred stock was re-
duced 10 per cent for the remaining 90 per
cent would be more favorable and the
preferred stockholders might look at II in
that way. We have thought the bonds
might be a thirty-year bond and CONVEX
tible into preferred stock within ten years
and redeemable at the convenience OF the
company after ten years at no Another
thing we would accomplish II We got
40 per cent of the preferred stock in obli-
cations maturing in fifty years, we would
he creating a sinking fund for retiring what
Is considered some OF the water in the
concern. So far as the common stock is
concerned this Ia going TO help 1t because
the earning capacity of the S50,OO0,O0O
would go toward the common stock. We
have worked out form OF bond and are
going TO submit It to the board l report
this matter so we may talk over the plan
II you desire We propose TO offer the
whole thing to the preferred stockholders
and let them vote on it,
Continuing the record quoted Judge
Gary asking II the option would be
extended to all stockholders and II the
finance committee proposed to make an
elastic bond $50 you can, II necessary,
issue bonds in place of preferred stock"
The remainder of the record was as fol-
lows;
"Mr Perkins--No, we think that would
be dangerous. We figured 10 per cent be-
cause we believe that $3.50, 5000 Of second
mortgage bonds would be considered very
good; whereas II we called $50O.COo,000 of
preferred stock, the universal criticism
would be that the bonds are not better
security than the stock and il you pass
the dividends on the preferred stock you
would not be in the hands of a receiver.
and II you passed the interest on Nhe bonds
you would be-"
Mr.. Perkins Examined.
George W. Perkins a director OF the
United States Steel corporation, former
chairman OF it's finance committee and
former partner In ]. p Morgan a Co, APP
peared today before the house committee
Of inquiry into the United States Steel cor
porAtion. Richard v. Llndabury, counsel
for the steel corporation, accompanied 'hin,
At the outset. Mr.. Lindabury made a
statement saying that he would like to sub
NIT the names OF scientists who hold tina:
the United States Steel corp6raion has no
monopoly OF the available ores In the Br-
mingham district.
Chairman Stanley Of the committee de-
olared that he regarded the question Of ore
holdings as one OF the most important at
issue and that the committees would well
come reliable tests from any reputable
scientists.
who were members Of the firm of j. p,
Morgan & Co. when you entered the
FIRM
Il could not give all of them but there
were j. Pierpont Morgan, Robert Bacon,
Charles Steele, L. r. stotesbury and ], p.
Morgan, jr.
do you remember having a conference
with Grant b. schley in Mr.. Morgan
library In November, 1907"
Yes. The question OF rendering assist
anoe TO MIR. Schley's firm had been under
discussion for several days. on Saturday,
November 2, through Mr. Ledyard. the
matter was brought to MIR. Morgan's atten-
ton in the library. 1t was apparent that
the only thing that would save Mr.. Schley
from failure on the following Monday was
for some one 70 render him financial as
sistanee. Several acute stages OF the panic
had caused strained situation. one diff
Guilty with Moore s. schley was that they
had a large amount OF Tennessee Coal and
Iron stock in their loans. some OF them
call and time loans that were Just maturing
'Schley told me that his time loans could
not be extended. They were very large
S90.Oo0.OO0 and that was the reason he came
TO the steel corporation,
Does Not Remember Contributions.
Chairman Stanley then referred to rec