The Bridgeport evening farmer., 1916-08-17
ANNOUNCEMENTS | OF 25O MILLION
 LOAN TO ENGLISH
Issue Will Be Secured by $3OO,OO0,O0O In Stocks
 and Bonds.

hundred and fifty million dollar col lateral loan by American bankers to the British government were made public formally yesterday by Henry P. Davison, of the firm of J. P. Nor gan & Co. MT. Davison said: 'The government of the United Kingdom of Great Britain and Ire land proposes to issue s250,0O 900 of it's two year per cent secured loan gold notes, to be dated September 1, 1916, to bear interest at the rate of 5 per cent. per annum, payable semi annually. and to mature September 1, 1913, but at the option of the govern ment to be redeemable in whole or in part on 30 days, notice on any day until and including. August 31, 1917, at lOl and accrued interest, and on amy day thereafter until and including August. 31, 1918, at 100 1-2~and accrued interest
 Both principal and interest are to De payable in New York, in United states gold coin, without deduction Tor any British taxes, present or fu- ture.
 The notes are to be secured equally ana ratably by pledge with. the Farm CTS Loan and Trust company, of New
 ork city, of certain bonds, stocks and otner securities, pursuant to a pledge agreement to be executed and deliv- cred by the British government to the trust company. The pledged securt- ties. which are to be approved by !. F. Morgan & Co.,, are to have a value ! Of at least $500. .O00, ,0Oe, calculated on the basis of prevailing market prices. sterling securities being valued in dol. lars based on the prevailing rate of exchange. The pledged securities are to be as follows:
 | Group 1.-Stocks, bonds and oth- CT securities of American corporations Of the aggregate value of not less
 than $100, 100000. . Group 2.-Bonds or other obliea- t1ons of the government of the Do-
 minion of Canada, either as maker or
 guarantor, and stocks. bonds and oth-
 CT securities of the Canadian Pacific | Railway Co.,, of the aggregate value
 of not less than $100. 100000. Preliminary Deposit. Pending the arrival and deposit of a portion of such securities the British government is to deposit temporarily with the Trust Company either ap- l proved New York Stock Exchange collateral or cs-h, or both, under pro- vision for withdrawals of such tenn porary deposits to be contained in the pledge agreement 'The pledge agreement is to provide
 that if the pledged securities shall de- precfate in value because of change in market price or in rate of exchange
 so that the 20 per cent. margin shall have become impaired the British government will deposit additional se- | curities with the trust company to the end that at all times the trust com pany shall hold securities of a value
 in New York city equal at least to 120 per cent. of the amount of the loan 1 at the time unpaid and not covered by l cash deposits.
 "The pledge agreement is further to provide that from time to time the
 British government may sell for each any of the pledged securities, in I which event the proceeds of sale shall
 be received by the trust company and applied to the retirement of notes by purchase, if obtainable at or below
 the redemption price, or otherwise by
 redemption by lot at such redemption price.
 | "The pledge agreement may also
 contain provisions approved by J. P.
 Morgan & Co.,. for substitutions of collateral, such substitutions, how
 ever, not to vary the relative amounts
 in value of the three several groups of the collateral at the time held by | the trust company.
 "It is proposed to offer these notes publicly in the future at 99 and ac- crued interest. We are now forming
 a syndicate to underwrite the notes
 at 98 and accrued interest, such sym
 dicate to expire Oct. 1, 1916, unless
 sooner terminated by the syndicate managers"
 The banking syndicate which has agreed to underwrite the notes is composed of the following:
 J. F. Morgan & Co.,, First National Bank, National City Bank, Guaranty
 Trust Co.,, Bankers Trust Co, Farm ers' Loan & Trust Co.,, General Trust Co. of Illinois, Union Trust Co. of Pittsburgh, Harris, Forbes & Co.,, Brown Brothers & Co.,, Lee, Higgin- son & Co.,, Kidder. Peabody & Co.,, William A. Read & Go. and J. & w. Seligman & Co.
 With the exception of a compara- lively small amount to be employed in the refunding of short term obliga- tions incurred here by the British l government the proceeds of the sale of the notes is to be expended in the United States for the purchase of mu- l