Evening star., 1942-04-11
40,0O0-Share Issue
By Gas Light Co.
Approved byP. U.C.
Check on Agreement
With Underwriters to
Clear Stock Plan

Subject only to final check on an
agreement between the company and
underwriters, the Public Utilities
Commission has approved petition
by the Washington Gas Light Co. for
issuance and sale of 10000 shares of
IS cumulative preferred stock at a
price of 500 a share.
Within five minutes after the con-
cluSion of a four-hour public hear
ing, the commission announced late
yesterday its approval of the issue,
as well as a waiver of the commits
sion's general rule requiring COM
petitive bidding on utility stock is
sues. The only condition was that
the commission still reserved judg-
ment on the terms of the agreement
between the company and group OF
nine Washington underwriters.
There was general agreement as
to the need of the company for new
financing, particularly to meet de-
mands created by reason of the war
and the resulting increase in Wash
ingtons population.
Changes in Prospect.
Some collateral issues raised dur
ing the hearing, however, still are
awaiting a final answer and these
may lead to important changes in
the financial setup of the company
and its procedure.
At the request of Gregory Hankin,
commission, chairman, E. Barrett
Prettyman, company counsel, agreed
for the company that its common
stockholders would be asked to vote
on a proposed revision of the COM
pany charter under which majority
voting rights would be given to the
preferred stockholders If as many as
six consecutive dividends were not
paid.
There are now $4,000 shares of
preferred stock, whereas there are
425 900 shares of common stock, CIV
ing the latter, as class, voting con-
troll. Chairman Hankin suggested by
questions that such q change might
be ordered by the commission with
out the necessary delay of two or
three months of getting vote by the
present stockholders, but Mr.. Pretty
man insisted it would have to be sub
mitted to a stockholders vote since
that question had not been presented
when they approved the proposed
10000 preferred stock issue.
Robert C. Overs, company vice
president in charge of financial mat
ters, told the commission the pres
ent market was such that individual
brokers would not assume the sale of
the stock alone, and that therefore
the company had negotiated tenta-
tive agreement with nine Washing
ton underwriters. His statements
were confirmed by Yelverton E.
, Booker, Washington broker, whose
frm is one of the proposed under
Writing group.
Explains Payment.
Mr. Booker also gave reasons to
Justify the proposed payment of
$3.50 per share to the underwriters,
these including explanations that
the brokers were assuming finan-
cial responsibility for half of the
issue and the value to the company
,af the service of brokers in selling
such an issue.
{ As he was stating that brokers
>succeed year after year only by the
trust investors have in their integ-
rity and advice, Chairman Hankin
asked: do you mean to say that
investors would pay more attention
to the talk of a salesman than to
approval given a stock issue by the
commission" Mr.. Booker promptly
retorted: "Yes, sir. Where their
treasure is, there is the heart"
Common stockholders of the COM
pany have pre-emptive rights to
purchase any or all of the new issue,
II they so elect.
Recently the commission granted
the company Authority to issue
42.5O0 shares of S4.25 cumulative
preferred stock, subject to later ap-
proval by the commission on any
actual proposal for sale. Company
officials said this other issue was
being deferred for later action. de-
pending on the financial needs of
the concern.