The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1914-03-17
Light Concern Files S3,OOO,-
600 Mortgage to Secure
100000 of Newly Made
Bond Issue.
NAMES 2 TRUSTEES
TO HOLD PROPERTY
Trustees Unable to Dispose
of Bonds Without Author
ity of Directors and State
Board.

Record of a 100000 mortgage on
property of the Richmond Light, Heat
and Power company has been filed
with the recorder of Wayne county.
This mortgage is for the purpose of
Securing 100000 Of the $S50,00O bond
issue of the company, authorized by
the Indiana Public Utilities commits
sion in January, and also secures
$4,000 900 of bonds issued by the COM
pany to two trustees for the corpora
ton, Demas Deming, of Terre Haute.
Ind, and the New York Trust COM
pany. of New York.
These trustees, however, cannot dis
pose of any part of these bonds with
out the authority of the board of di
rectors OF the company and the con-
sent of the public utilities commits
sion.
The balance of the $S5O,OOO bond
issue authori2"5 by the commission
in January, $450, 200, was guaranteed
by the United States Gas and Electric
company and was not required to be
secured by mortgage, consequently
the S3,000,000 mortgage filed with the
county recorder does not affect the
non-secured bonds of the issue.
Trustees Hold Property.
To the two trustees appointed for
the Light. Heat and Power company.
the mortgage record sets forth, all the
property of the company has been
decided.
What is the purpose of the United
States Gas and Electric company plas-
tering such a large mortgage on the
local plant?" was asked Wilfred Jes-
sup, one of the local attorneys for
the corporation.
He replied that the s2.600.000 bonds
held in reserve were for emergency
purposes and to finance the company
for future needs.
1.-The incidental expenses for pre-
pairing this mortgage were heavy, in
excess of $4,000, should say, but
from a standpoint of economy were
warranted. eliminating future expendi-
lures for such purposes anu prepar-
ing the company for future contingent
cies," Mr.. Jessup said.
Constitute War Fund.
"As a matter Of fact those s2,600,O00
of bonds held in reserve by the trus-
tees constitute a war fund do they
not?" he was asked.
well. you might put it that way
Mr.. Jessup responded.
But sphinx-like silence was main
tanned on all questions leading up to
1he SUBJECT OF "ndt HeCeSSllN lneIe
was for creating such a war fund
The company frankly admits its
purpose of expending money to III
crease the valuation of its local cleo
trical plant for rate making purposes.
alleging that the rate schedules re-
Gently established by the commission
for both local plants being too low for
the L.. H.. and p. company to operate
its plant at a profit.
$4,000 Balance.
However, after the funds derived
from the sale Of SS500O0 bonds, au-
thorized by the commission, had been
used for paying off the old bond and
note indebtedness of the company
there remained $4,000 to be utilized
for increasing the valuation Of the
electric plant. considerable sum to
be devoted for such purpose. And
Mr. JessuD admits this $4,000 will be
used for that purpose.
The mortgage states that all the as
sets of the company have been sold
and assigned to the New York Trust
company. of New York city, and De-
mas Deming. of Terre Haute, Ind, as
trustees for the bond issue.
The mortgage for $3,0C0,000 which
covers the per cent cold bond issue Of
ty right and contracts of the company
which are now held or may be held at
any future time. and includes the con
tract for natural gas which was made
by the company with the Logan Ma
tural Gas and Fuel company. The
bonds redeemable at any time at S105
and accrued interest. Four hundred
thousand dollars of the amount is to
be used for refunding a first mortgage
loan which comes due this month, and
$4,000 900 remains in the treasury to
be issued from time to time by and
with the consent of the public ser
vice commission and the board of di-
rectors of the company.
The mortgage covered eighty printed
pages and contained over "a 900 word 5
which, according to Recorder Parsons,
Is the largest document ever submitted
to the local recorder.