The New York herald., 1922-06-04

600 shares you have underwriters who
VIII take 1t OF your hands?"
Yes"
And they are men in the banking
world and the mercantile world?"
Largely people throughout the coun-
| try" a
prises?"
! Yes"
! And on your assurance that that is a
good thing they take it?"
They know we would not put our
name TO II otherwise"
When your company says that II Is a
good thing they will take it?"
There is no assurance given. The
fact that we offer it.
| That is quite enough?'
| That is quite enough"
And they take II and agree 10 pay
! s43 a share for it. and that Is the same
class of stock that you agree to pay ten
dollars share for?"
Yes"
II ask you again. have you any doubt
that that represents at least $43 a
! share?"
1T may or may not"
Have you any doubt that 1t does? II
you have any doubt that it does. will you
! tell me why you are recommending your
syndicate members to underwater"
II expect 1t will sell at a great deal
| higher than 49,"
Explains $2O,OOO,OOO Fund.
| Mr.. Schiff interposed an objection to a
statement in a morning newspaper quot
| Ing Mr.. Untermyer to the effect that the
merger provided opportunity for the in
siders to unload and the outsiders TO
load up" He demanded Mr.. Untermyer's
withdrawal Of the Objectionable phrase,
whcreupon the lawyer ordered the
banker back to the stand and led him
once more over the contemplated action
of the syndicate in regard to the COM
mon stock.
Mr. Schiff objected vigorously to the
suggestion that the $40. 900 900 cash fund
provided by the underwriting plans was
for manipulating the market. The dis
cusston between the banker and the law
yer cached it's climax at this point when
Mr.. Untermyer warned the witness that
he was taking chances on going TO jail.
BY way OF explaining a question. Mr..
Schiff began: E%
The $4,000. 900 of which We have
been speaking is s20.o00.000 furnished
by the syndicate, which makes up the
difference between s44,000.000 and
| $64,000,000. the total obligation to be
| furnished by the syndicate to the extent
we may call upon them, to buy stock
| In the market to provide for the small
| stockholders who may want to sell II the
public does not want to buy. We are
| ready to back our Judgment with the
additional $40. 100000 to buy the stock
even though the public does not want
| to buy it,
What the syndicate agrees to do Is.
hac ell ,ovlra III tg 10
pend UP to $20.000,00o in the purchase
Of additional stock?''
Yes. in the market"
"Trade Not Simultaneous"
80 that while with one hand it Is
! selling stock to the public with the other
hand 1t is buying stock from the public?'
mo. Mr.. Untermyer.''
well, isn't it?''
mo. because it does not happen
| simultaneously
How do you know it does not?"
Because It does not. We do not wash
| stock, Mr.. Untermyer. i resent that
implication"
"All these resentments. you know.
don't count. The facts are what we are
| looking for"
Then put the question In the way
so that they are facts and don't twist
| things
Mr. Untermyer:
Mr.. Chairman. you had better warn
this witness that he is not in his banking
office"
| Mr.. Schiff:
And neither are you in your Office"
Mr.. Untermyer:
/ Mr.. chairrnan--''
Mr.. Schiff: 2
| Mr.. Chairman, Mr.. Untermyer Is try-
ing to put words in my mouth. that we
are manipulating stock, and I will not
do It, refuse to answer another ques-
tion."
Senator Lockwood. the chairman: ere
you do not understand the question do
not answer"
Mr.. Schiff: IF you are not going
20 change your question. refuse to
answer any more. and take my chances"
win Take Untermyer. Along.
| Mr.. Untermyer: Then YOU take
chances OF going to jaily
| Mr.. Schiff: "Ali right. I will take
that chance, and you will appear in my
company"
| Mr.. Untermyer: Just a moment. !
think not this time"
The Chairman: "If you cannot an
swer. Mr.. Schiff. you will state So"
| Mr.. Schiff: Mr.. Untermyer won't
permit me to answer questions lie
twists words in my mouth"
Mr.. Untermyer: You answer my
question"
II am answering my question:
| The Chairman: II think you can an
swe- that question"
| Mr.. Schiff: II cannot answer Il yes
or no, because II is pnrased in such
manner that II is impossible"
Mr.. Untermyer: Very well, the wit
ness cannot answer that question. You
can either answer the question or you
cannot. Now, Just as soon as this trans
action Is concluded. your syndicate pro-
poses 10 market this stock on the ex-
changer
Not necessarily; we may hold IT,"
."Obligation Only to Buy"
How long are you contemplating taxi
| ing to dispose Of these 900 shares OF
common stock. and 100000 shares OF
preferred stock?"
II don't know"
well. an operation OF that kind takes
months, doesn't it?"