Evening star., 1933-05-31

list of names suggested by Morgan
during the recess.
Almost hidden by counsel and mem
bers of his staff, Morgan sat behind
table several feet from the committee
table. He rested his cheek on his arm
and listened intently.
Pecora asked II there was any break
down of the $1,000 units OF United
that went to Drexel & Co.
I thought that had been furnished;
I'm sorry" Whitney said.
ION what terms were these persons
invited to subscriber" -.
whitney said they were sold one unit
at sT5. a unit consisting Of one share
of So preference stock at its liquidating
value of $50 and one share of common
at S25. "the price Of the common to us. ="
He gave the Spring of 1928 as the
date when j. P. Morgan & Co. decided
to enter the general utility field
Pecora brought him back to the sale
to ]. P. Morgan g. Co. for 100000 600
of 400 900 shares of United common
and II ,00O, 600 warrants.
Offered simultaneously.
1--WE and Bonbright g. Co. made the
same offer simultaneously and 1t was
accepted" Whitney said.
Questioning Whitney, Pecora brought
| out that the private offering was made
! between January 9 and January "a.
! And it was previously testified by
| Mr. Howard" Pecora said, that on
! January 2l, the stock was selling In
! the over the counter market at $99
| a unit
yes" Whitney nodded.
He leaned forward with his elbows
| on the table, while Pecora sat back
! in his chair.
BY this time, half Of the committee
| table was unoccupied, as Senators left
to attend the Senate session.
! The committee room was hot again
| and perspiration stood out on Whitney'S
! face.
! Members of the committee interrupt
! ed Pecora less frequently than usual
apparently satisfied with his explana-
tion of his program earlier
Was SIS the actual cost OF these
units to you?" Pecora inquired.
Yes" Whitney replied.
But the units were set up on your
book at no consideration"
Whitney said this was bookkeeping
matter, but insisted that $75 was the
actual cost of Morgan & Co., "the
common cost S25 share and the
preferred s5o.'
But you gave no value to these
option warrants. You treated them as
a bonuS?"
I'VE did not" Whitney rejoined, "but
We did not think them proper assets
to be carried on the books of the bank
ing firms as such"
"Well, they proved very valuable
eventually?"
tsUeII thew went I'm
''What did they rise to?"
"To about $40, I think"
wasn't it about S47.50?"
81 don't know"
Pecora produced letter which he
said may refresh your memory"
1t was from Thomas S. Lamont 10
Whitney and the date was July %
1929.
The letter said "53 900 shares" OF the
option warrants were sold 'as planned,
and added that $500 later were sold
and that the $4,000 shares sold from
45Ia to ASA. The $500 sold from 46%
to 467s.
Did you sell these shares for thu
account of Morgan & Coz"
Whitney said "Yes" after consulting
data.
"The Morgan firm sold 2s.45o on July
23," he said, land about 200, 600 shares
were sold during the next two months.
What was the low?" Pecora asked
and was told it was around 1888
Pecora brought out that between July
% and September 20 Morgan g. Co
sold zoe, 900 warrants for So, ,490,046.
He askedA II the Morgan partners
= could not-fla$e sold the !, ,5l4, 200 option
! warrants distributed to them on De.