The New York herald., 1922-06-09

market on the faith of that statement
when in point of fact you are not obi
gated in any way to form a syndicate
to raise this money upon that plan? A
The statement clearly states that we
are not.
Mr.. Schiff protested against this line
of inquiry. When ordered to answer
to do.
The>examination continued:
Q. Are you under any obligation to
the public authorities to halt this merger
until they have had a chance to inquire
into It? A. will have to refer you to
counsel on that.
@. Have the details of this merger
been furnished to the Federal Trade
Commission? A. I don't know. i will
have to refer that to counsel to handle
that.
O. You said on Saturday that with
marketing this stock you would probably
employ forty or fifty brokers. A. We
might.
O. The agreement will also prescribe
that In your diicretion as syndicate
managers you may buy Of this same
stock up to $50, 000. 900, isn't it? A. Yes.
@. Now then. having made an agree
ment to use your best efforts to sell
505,000 shares of stock. and in your dis
cretion TO buy up to s20,00o.o0o Of
stock, will these forty brokers to whom
you give orders be all brokers to sell
stock or will some Of them be brokers
to buy the stock? A. We are buying
and selling stock at different times. 1t
may bel don't know.
Q. That answers my question II you
really don't know. Now, assuming that
you are going to distribute these orders
these orders are generally distributed
to sell on a scale down or scale up?
A. Not necessarily.
Q. The selling orders? A. Not neces-
sarly. We usually give definite. orders
for definite amounts at definite prices.
Q. To different brokers'? A. Yes, We
don't give very large orders to any one.
He said these brokers sold at differen.
prices.
Q. But when the orders are given at
different prices doesn't that tend to de-
press the stock, to run. the price down
when there are all selling orders and no
buying orders? A. We seek to sell on
a rising market.
@. And the more stock you sell the
more the market rises? A. 1t sometimes
SO happens.
@. And the more you buy the more It
goes down? A. That has happened also.
Chadbourne Sees Dinerential Cut.
Mr.. Chadbourne was informed when
he took the stand that the committee
was not satisfied that his relations with
the four companies that dropped out
of the contemplated consolidation were
entirely those OF lawyer and client and
that his information concerning that
part of the merger negotiations was
privileged. He agreed with Mr. INTER
mye- that the United States Steel Com
pany by its SO to IS direrentiar con-
trolled the industry.
Q. wish you would explain in what
respects 1t Is expected that this merger
will reduce the differential? A. My
own judgment Is that on selling and
administrative expenses alone they can
cut off 81 ton in the steel companys
differential.
Q. Are there other companies con-
templated in the merger so located that
their being taken In would still further
reduce the United States Steel Com
pany differential? A. No. there was
when Youngstown sheet and Tube and
Brier Hill were discussed. It would
have helped In the Youngstown district
@. Is there any understanding that
you know of. or anything in contem-
plation whereby that stock will remain
in the treasures of these companies. or
any Of them, and not be distributed un-
III tHe hunn-L<OeD STOCK synulcate mas
had certain time in which to market
its stock? A. On the contrary, know
that Is not so.
q. Then it is your understanding
that this stock will be Immediately dis
tributed? A. Clean cut understanding,
no doubt OF it.
@. And that there is no limitation
upon its sale by the individual stock
holders? A. None Of any kind, name
or nature.
The committee will resume at 0:so
this morning.