21, 1911 (Chapter 195, Laws of 1911), and this power is not restricted by any other provision of the law governing public utilities, or corporations generally. All such agreements or contracts, however binding upon the individual parties thereto they might have been, in default of the Legislature's subsequently vesting power over proposed security issues in this board, are not controlling so as to delimit the board's action upon proposed security issues. For such outstanding securities as may legally have come into existence prior to the passage of the Act of April 21, 1911, this board has no responsibility. But its authority is not delimited by expectations or contracts between private parties made prior to the enactment of the statute in question. Where the provisions of such agreements can be carried out comformably to the general principles regulating the approval of proposed security issues by this board, no obstacle will be interposed by the board to such authorization. But the carrying out of such provisions of agreements or contracts as involve issue of new securities must be submitted to the board. 8. The declaration of stock dividends by public utilities is permissible only in such cases as this board after hearing may authorize. To declare such a stock dividend without first obtaining the approval of the board is a misdemeanor, and all such securities issued without the board's approval are illegal. In general, the board will approve of the issue of stock dividends by public untilities only after hearing and investigation and after being satisfied that as the outcome of such issues the net assets and property of the company over and above other liabilities resting thereon shall be equal to the par value of the total stock outstanding after such stock dividends have been made. Adequate depreciation reserves and surplus must also be provided by a public utility petitioning to issue a stock dividend, and a careful inquiry will be made by the board into the methods by which the additional stock dividend is to be justified. Full publicity of approval of all petitions for stock dividends will be deemed essential. 9. For the information of all public utilities intending to petition this board for the approval of proposed security issues, reference should be made to Conference Order No. 7 and Conference Ruling No. 13 of the board. The requirements of this order and ruling as to the form and content of petitions should be carefully observed. Petitions should be filed sufficiently in advance of the time at which approval of securities is desired to insure the board reasonable time to make the inquiries relevant. The larger the proposed issue, and the more complex the conditions surrounding it, the earlier should the application be filed with the secretary of the board. The petitions will be acted upon hereafter in order of their filing as indicated by the dating stamp of the secretary's office. Applications essentially defective in form or content will not be listed for consideration until properly amended. Where such applications involve the necessity of inventoring property or checking accounts, the public utility applying for such authorization is requested to give such assistance as is within its power by putting its engineers, managers and accountants in touch with the board's inspector. Where the annual reports required of public utilities have not been promptly filed as required by the rules of this board, or where such accounts when filed, disclose failure upon the part of the public utility to comply with the requirements of law or with the terms upon which previous security issue of said utilities has been approved by this board, any subsequent petition for the approval of securities by a public utility shown to be in default may be postponed until the requisite and legal compliance with the law and the lawful rules of this board has been made by said public utility. Adopted July 8, 1912. STOCKHOLDERS' RIGHTS 1 THE NEW YORK, NEW HAVEN AND HARTFORD RAILROAD COMPANY 1 NEW HAVEN, CONN., October 15, 1913. To the stockholders of The New York, New Haven and Hartford Railroad Company, and to holders of its 32% Convertible Debenture Certificates convertible between January 1, 1911, and January 1, 1916, and to holders of its 6% Convertible Debentures convertible between January 15, 1923, and January 15, 1948: Pursuant to resolutions of this Company's stockholders and directors, this Company hereby offers for subscription its Convertible Debentures of 1913, of the aggregate principal amount of Sixty-seven Million Five Hundred and Fifty-two Thousand Dollars ($67,552,000), all to be dated October 1, 1913, to be payable October 1, 1933, to bear interest at the rate of six per cent. per annum, to be convertible after October 1, 1918, and not later than October 1, 1928, into shares of the Company's capital stock, par for par, with an adjustment of interest and dividend, and to be issued under and in pursuance of an indenture between this Company and a trustee, to all the provisions of which said debentures and the rights of the holders thereof will be subject. These debentures will in substance provide, so far as lawfully may be, that the holders thereof shall enjoy, until October 1, 1928, a right of subscription to any future issue of capital stock of the Railroad Company to the same extent as if holders at the time of such issue of the shares of the capital stock of the Company to the future delivery of which they are entitled. These debentures will also provide, so far as lawfully may be, that if this Company shall hereafter create any mortgage upon its now existing main line of railroad between Woodlawn in the City and State of New York and Springfield in the Commonwealth of Massachusetts, or its now existing main line of railroad between New Haven in the State of Connecticut and Providence in the State of Rhode Island, such debentures shall without further act be entitled to share in the security of such mortgage pro rata with any other obligations that may be secured thereby, and that any such mortgage shall expressly so provide. The right to subscribe for these Convertible Debentures of 1913, on or before November 15, 1913, but not thereafter, is offered as follows: 1 Notice advertised in New York Times, November 1, 1913. To the holders of stock of this Company (not held in its treasury) of record at the close of business September 9, 1913, a right of subscription at the rate of One Hundred Dollars of principal amount of such debentures for every three shares of this Company's stock held by them respectively. To all holders at the close of business September 9, 1913, of this Company's 32% Convertible Debenture Certificates convertible into stock between January 1, 1911, and January 1, 1916, which are registered as to principal and interest, a right of subscription at the same rate as if the holders of such contracts were holders of the stock of the future delivery of which they are entitled under the terms of said contracts, to wit, at the rate of One Hundred Dollars of principal amount of such debentures for each Four Hundred and Fifty Dollars of principal amount of such 32% Convertible Debenture Certificates held by them respectively. To all holders at the close of business September 9, 1913, of this Company's 6% Convertible Debentures convertible into stock between. January 15, 1923, and January 15, 1948, which are registered as to principal and interest, a right of subscription at the same rate as if the holders of such contracts were holders of the stock to the future delivery of which they are entitled under the terms of said contracts, to wit, at the rate of One Hundred Dollars of principal amount of such debentures for each Three Hundred Dollars of principal amount of such 6% Convertible Debentures held by them respectively. To all holders of such 32% Convertible Debenture Certificates or such 6% Convertible Debentures having coupons attached, whether registered as to principal or not, a similar right of subscription at the same rate as if the holders of such contracts were holders of the stock to the future delivery of which they are entitled: provided, however, that such holders shall present such debentures on or before November 15, 1913, to either The Treasurer of the Company, New Haven, Conn., Treasurer's Agent, Grand Central Terminal, New York City, Treasurer's Agent, South Station, Boston, Mass., Bankers Trust Company, New York City, Old Colony Trust Company, Boston, Mass., Rhode Island Hospital Trust Company, Providence, R. I., Hartford Trust Company, Hartford, Conn., Union Trust Company, Springfield, Mass., Morgan, Grenfell & Company, London, England, or to be stamped substantially as follows: "Right to subscribe for Convertible Debentures of 1913 exercised by holder hereof without affecting the within contract." All subscriptions must be for debentures of the principal amount of One Hundred Dollars or multiples thereof. Fractional rights of subscription must be so combined by purchase or sale thereof as to entitle the holders to subscribe for debentures of the principal amount of One Hundred Dollars or multiples thereof. The Company can neither buy nor sell rights. Under the subscriptions to be made in accordance herewith, the subscribers will be obliged to make payments in one of the following ways: 1. In one payment on or before November 15, 1913, of an amount equal to the principal amount of the debentures subscribed for, with interest thereon at the rate of 6% per annum from October 1, 1913, to November 15, 1913. 2. In two payments, the first on or before November 15, 1913, of an amount of money equal to sixty-five per cent. of the principal amount of the debentures subscribed for, with interest at the rate of 6% per annum on the amount paid, from October 1, 1913, to November 15, 1913, and the second on or before January 15, 1914, of the unpaid balance of the principal amount of the debentures subscribed for, with interest at the rate of 6% per annum on the amount then paid from October 1, 1913, to January 15, 1914. Payments may be made either directly to the Treasurer of the Company at New Haven, Connecticut, or through any of the above-named agencies. Failure to make payment upon a subscription in accordance with the above provisions will operate as an abandonment of all rights as a subscriber. No subscription or assignment of any right to subscribe will be recognized unless made on the forms of the Company and upon the terms and in the manner prescribed by the Company. Subscription warrants specifying the amount of debentures for which under this circular stockholders and registered holders of Convertible Debenture Certificates and Convertible Debentures are entitled to subscribe, will be mailed to them as soon as is practicable. Such warrants will be issued to the holders of such Convertible Debenture Certificates and Convertible Debentures having coupons attached after the holders thereof have presented them to be stamped. The warrants to be issued will be of two kinds: warrants certifying a right of subscription for debentures of an aggregate principal amount of One Hundred Dollars or multiples thereof, and warrants |