THE SUNDAY OKEGONIAX, PORTLAND, APRIL 21, 1907.
Will -Enter iicii Hew :
.N
First Offering of Stock In the
Southern Telephone-Electric
Company
The telephone has become one of the most important
factors in the business and social life of the entire world.
.This is especially true of the United States. The tele
phone's constantly in demand by the people, and although
furnished at a very reasonable rental, it has been found
to be a very profitable investment. . Large percentages
have been made by those holding securities of telephone
companies.
The Southern Telephone-Electric Company was or
ganized principally to conduct a telephone business in one
of the richest sections of the United States, viz.: The
State of Texas, constructing and operating both long
distance and local telephone systems. The Southern Telephone-Electric
Company is not only a telephone company
itself, but also a telephone construction company. It will
work along lines somewhat similar to those employed by
the Empire Construction Company of the Pacific Coast,
thus assuring large and continuous profits for its stock
holders. Mr. E. L. Swaine, President, in speaking of the plans
of operation, states as follows : "The Company now owns
the Fort Worth Long Distance Telephone Company, and
will soon acquire extensions for the construction and
operation of local exchanges in a number of towns in the
State of Texas.
"The Company will hold control of, the long distance
lines, which will enable us to protect the business of the
local exchanges, besides bringing a good revenue.
"When a local plant has been constructed and in oper
ation a company will be formed among the business men
of the community. They will subscribe for the stock, as it
will pay a good interest on the investment, and they will
be the owners of the property in their own town.
"The Southern Telephone-Electric Company will re
ceive for such plants from the new local companies part
cash and part bonds, based on the earning power of the
companies, which cash and bonds will give a very good
profit on the work of construction and place us in a posi
tion to turn over the funds again in another locality.
4
"The profits' of the telephone- business have proved
very satisfactory, paying good percentages on bonds and
stocks, besides enabling the companies to lay aside a fair
surplus. This refers to the operating companies, from
which class we expect to secure a portion of our earnings,
the greater part to come from the profits on construction.
It is the intention to set aside for sale only sufficient stock
to provide, capital to carry on the work in hand, which
will enable us to pay very satisfactory dividends on the
outstanding stock. v
"Our representative now in Texas writes of the great
possibilities there, and we are looking forward to remark
able success."
The Southern Telephone-Electric
Company
Is a corporation duly organized and incorporated under
the laws of the territory of Arizona. The capital stock
is ten million dollars ($10,000,000), divided into one hun
dred thousand (100,000) shares of a par value of one
hundred dollars ($100) per share. The stock is fully paid
and forever nonassessable. There is no preferred stock
and no bonded indebtedness. Each and every share of
stock is on an equal basis. The organization or charter
member price of this stock has been placed at $25 per
share. Every share of stock issued at the present time has
been paid for in full at that price. Not one single share of
promotion stock has been issued. The officers and direc
tors of this corporation have paid the same price$25 per
share, for their own stock that they offer it to their friends
and acquaintances.
The purpose for which this Company was organized,
to acquire, develop and carry on a system of independent
( or home telephone plants, both local and long distance,
in one of the richest telephone fields in the United States,
will be dwelt upon at length hereafter.
The territory, or field, which has been selected by this
board of directors is one of the richest in the United
States and at present almost overlooked, except by the
interests controlled by the Bell Telephone.
The charter of the Southern Telephone-Electric Com
pany is broad, permitting the company to carry on the
business of constructing and operating telephone plants,
long distance lines and equipment, electric power and
lighting plants, and any and all business pertaining to the
acquiring, operation or development of the telephone and
electric lines. The charter permits this company to act as
a holding company. In other words, grants the corpora
tion all privileges of holding the stock of other corpora
tions in fact, to carry on all of the business at present
contemplated. It covers all exigencies which can possibly
be foreseen, facilitating the future development of the
independent telephone business in the State of Texas.
INFORMATION COUPON
Southwestern Securities Co., Fiscal Agts.
300-301 TUford Bulldlns;. Portland. OragSi.
I am Interested In your SOUTHERN TELEPHOXB-EIEC-TRIC
COMPANY, and If my request 1111 not obligate me In
7 way I aball be glad to receive farther Information.
Kama
address
P. O. 4-21
The affairs of the corporation will be under the man
agement of the following Board of Directors :
E. L Swaine, General Manager of the Home Telephone ana Tel
egraph Company, of Los Angeles, Cal.
R. J. McHngh, Chief Installer and Pacific Coast Sales Agent of
the Kellogg; Switch Board and Supply Company.
tf. F. Wilson, San Francisco. Cal.
Ernest A. Olds, Superintendent of Construction of the Home Tel
ephone and Telegraph Company, of Uw Angeles, Cal.
H. I- Edwards, Superintendent of the, Contracting Department
of the Home Telephone and Telegraph Company.
F. J. IV orris. Cashier of the Occidental Trust and Savings Bank,
of Los Angeles, CaU, and formerly auditor of the Home Telephone
and Telegraph Company. .
J. X. O. Rech, Attorney. Los Angeles, Cal.
Edgar A. Sharp, Attorney, Los Angeles, Cal. -
The officers of the company are :
E. JU Swaine. President! !. F. Wilson, First Vice-President; H.
I.. Edwards. Second Vice-President j E. A. Olds. Third Vice-President
J. K. O. Rech, Secretary i F. J. Norrls, Treasurer; R. J. Mc
Hugh, Chief Engineer.
The men who will have charge of the field work and
operation of the affairs of the Southern Telephone-Electric
Company are all practical, successful telephone men,
of unquestioned integrity and special ability in their par
ticular branch of technical eff ort;
The chief engineer for this Company, Mr. R. J. Mc
Hugh, has been associated with the Kellogg Switch Board
and Supply Company for a number of years. During that
period he has installed some of the largest telephone ex
changes in the United States, notably those of Baltimore,
Cleveland and St. Louis. . .
The Home Telephone Company of Los Angeles, which
has been one of the most prosperous and successful tele
phone corporations of the United States, has had as its
General Manager Mr. E. L. Swaine. The administrative
affairs of - the corporation will be under his management,
ably assisted by Mr. H. L. Edwards. Mr. Edwards has
also been connected with the Home Telephone Company
of Los Angeles for a number of years and has won an
enviable reputation for himself by carrying out a success
' ful campaign for the securing of contracts in Los Angeles
in the face of a tremendous opposition on the part of the
Sunset Telephone Company.
Mr. Ernest A.. Olds resigns as Superintendent of the
contracting department of tne Home Telephone Company
to devote his entire time to the Southern Telephone-Electric
Company. Mr. Olds is the man who set the first pole
for the Empire Construction Company in Los Angeles,
since which time he has been continuously employed as
Superintendent of Construction of the Home Telephone
.& Telegraph Company and the Home Telephone Com
pany of Los Angeles. In addition to these duties Mr. Olds
has acted as consulting engineer in the construction of
numerous small suburban telephone plants constructed by
independent corporations. .
Mr. F. J. Norris, formerly auditor of the Home Tele
phone Company of Los Angeles, and al present cashier
of the Occidental Trust & Savings Bank, will act in the
capacity of Treasurer of the Southern Telephone-Electric
Company, thus assuring a careful and economical man
agement of the financial end of this enterprise.
Further information as to the standing of the men
behind this proposition seems unnecessary, as their long
continuous record of success and their practical expe
rience in their chosen work are sufficient evidence of their
ability to carry out the plans and assure success of th
Southern Telephone-Electric Company. Remember, also,
that these gentlemen have sold and are selling their in
terests in other telephone corporations and placing their
available funds in the stock of the Southern Telephone
Electric Company at the same price and on the same basis
as the stock is offered to you.
The territory in which this corporation will operate"
is no less than the cotton belt of Texas, a belt containing
a greater population than the three Pacific States, Cali
fornia, Washington and Oregon, combined. This is today,
in the -minds of these men, the best and richest territory
. in the United States for the operations of such a corpora
tion. Let us emphasize the fact that these men are' fa
miliar with the telephone situation throughout the United
States and that they have chosen this rich cotton belt of
Texas because it offers greater inducements and quicker
and surer profits than any other territory. The company
already possesses the keynote to the entire territory. It
has already purchased long distance telephone lines,
which are constructed and in operation; also rights of
way for long distance lines" and franchises for construct
ing independent telephone systems in cities and towns up
and down this belt. In fact, so much work has already
been done and so much progress made that no other com
pany, even should it possess the same financial advan
tages and the same able Board of Directors, could pos
sibly become a competitor. This is a big element in the
success of this corporation. "
Great Profit In Telephone
Business
That there is good profit in the telephone business is
a fact so universally acknowledged that it seems unneces
sary to dwell upon it. A small investment in the stock of
the Bell Telephone Company has made many an inde
pendent fortune. At the present time there are more in
dependent telephones in the United States than Bell tele
phones, and there is just as much money to be made out
of an investment in telephone securities now as there was
when you could have bought Bell Telephone stock cheap.
Furthermore, you do not now have to take the risk that
was necessary when the telephone business was in its in
fancy. Since its inception the telephone business has been
classed among the most lucrative fields in when large
capital can be invested. At the present time throughout
the country independent telephone companies, wherever
established, working side.by side with the Bell Telephone
Company, are enjoying a much greater success than the
great monopoly. Two important factors create these con
ditions. First The average red-blooded individual has no love
for any great monopoly, and public sentiment has been a
great factor in establishing and making a success of the
independent or home telephone lines.
Second The independent telephone lines have an ad
vantage in being able to place new and up-to-date equip
ment at the disposal of their subscribers without being
compelled to lose the capital which the Bell has already
tied up in old and less effective equipment.
In 1894 there were 300,000 telephones in use in the
United States, or one telephone to every 230 people. In
1907 it is estimated that there are 5,600,000 telephones in
use, or one telephone to every 16 people. Of this number
the independent or home companies have 3,000,000
phones, against 3,600,000 of the Bell monopoly. These
facts prove conclusively how important and necessary is
the telephone to all business interests of the country, also
making a most convincing argument in favor of the in
dependent lines.
As an evidence of the profits of a telephone enterprise
we need only point to the earnings of the Los Angeles
company for four and one-half years:
1001 Gross Earnings 202.9O2 Net Earnings lo8,8T5
1803 Gross Earnlngn 3S33S2; Net Earnings.' 130,143
1903 Gross Earnings 306,490; Net Earnings 1S2.329
1904 Gross Earnlngn 435,272; Net Earnings 195.533
1005 Gross Earnings, Six Months 273,375
Net Earnings, Six Months 119,8S
The "Western Telephone Jour
nal" Has This to Say
of the Future
"It is only a matter of time when the whole North
American continent will be gathered under the banner of
the Independents.
"No movement in the world's history has a brighter
outlook than the one in which you are engaged. It has
passed through the stages of doubt and difficulty. It has
survived the attacks of the monopoly and its creatures.
The mighty wrongs and petty perfidy,
The loud roar of foaming calumny.
The small whisper of the paltry few.
And the subtler venom of the reptile crew."
"It only remains with courage and confidence to carry
on the work until every citizen throughout the land shall
be supplied with this means of conversing with his fellow
men. I do not see why, at the most conservative esti
matet the Independent development should not reach 10
per cent of the entire population within the next few
years. This will require an investment of approximately
$600,000,000, and of this you may be sure every dollar of
the money will afford a far more remunerative investment
than as if the same amount was put into railroads, elec
tric lighting or any other public utility.
"Do not be pessimistic about the future. As you pro
vide the facilities the people will reach .out for them. It
is not many years since wise men in the Dominion Par
liament predicted that the receipts of the Canadian Pacific
Railway would not pay for the axle grease. Today we
find two more transcontinental railways hurrying for
ward construction in a race to connect the Atlantic with
the Pacific. This is only one illustration of how we may
show timidity in estimating the possibilities of the fu
ture." . .
(Notet The foregoing was read before the recent Illinois State
Convention. Mr. Dagger is telephone expert to the Dominion House
of Commons' select committee on telephone systems, Ottawa, Can
ada. EDITOR.)
New Telephone Company Offers
Small Investor an Unusual
Opportunity
The time has come when the people ought to own the
public service corporations, and they are going to own
them, too. Here is an opportunity for a small investor
to buy. stock that should ultimately make him financially
independent. The conditions that make possible the suc
cess of this corporation are many times more promising
than they were when the Bell Telephone stock was first
offered to the public.
The money for carrying out the plans of this enterprise
is being raised by the sale of common stock, which is the
only form of security issued. The old-time method of
bonding this property to the bursting point will not pre
vail in this enterprise. Not a dollar in bonds, preferred
stock or security of any kind stands ahead or takes prece-
dence over the common stock. Every man or woman that
wants a share of this stock in the Southern Telephone
Electric Company will be on an equal footing first, last
and all the time. The full par value of the shares is $100,
fully paid and forever non-assessable, but, like all large
enterprises,, the first stock sold must be offered at a big
sacrifice in order to quickly raise sufficient capital to put
the company on a good dividend-earning basis. A portion
of the $ioo shares of the Southern Telephone-Electric
Company is therefore offered at $25 per share. The shares
that are invested in at this low price of $25 will, in a few
months, not only be worth their full par value but many
times more. The shares of the Home Telephone Com
pany in Los Angeles could have been bought three or
four years ago for only 10 cents on the dollar. These
shares of common stock are now earning dividends, after
- the company has paid out thousands of dollars on a tre
mendous bond issue. Bear in mind that the Southern
Telephone-Electric Company will have no bonds ; that it
has but one security common stock and that every
stockholder is on an equal footing.
Shares of a certain bank in New York City that stand
for $100 value cannot be bought for less than $3000. The
Great Northern Railroad shares, at a par value of $100,
sell in open market for $283. An investment of $500 in
Bell Telephone stock some years ago would have made
you a millionaire today. There are many such cases, but
none of them will ever show such a surprising rise as will
the shares of the Southern Telephone-Electric Company.
Many a clerk, grocer, plumber, carpenter or other men of
moderate means who have the foresight to realize the
marvelous possibilities of this investment and buy at the
present price will be numbered among our rich men five
years hence.
The profits that this telephone company will make fcr
its stockholders are almost beyond calculation. The nat
ural rise in value of the shares, because of the extraordi
nary earning power, is likely to be such that an invest
ment of $100 at the reduced price at which the first shares
are marketed may at the end of a few years stand for a
quoted market value of $2000 and a yearly income of $200.
If it does this, and it is not at all unlikely that it will, a
man who invests $500 in its shares now will have a yearly
income of $1000. Of course the only time such colossal
profits can be made is at the very start. After this com
pany organizes telephone company after telephone com
pany y establishes plants in various cities and towns, in
creases its" earning capacity day by day, its shares
will rise high in value, and those who buy at the
present price of $25 will be the ones who will reap the y
biggest profits.
Nothing can prevent the success of this enterprise.
Every possible safeguard surrounds the investment of the
public's money in this stock. Telephones are a necessity.
The telephone is the only public utility that thrives in
hard times. We have tried to show you that this is your
opportunity to lay the foundation of wealth. Whether
you have much or little money, we say to you in all
frankness and candor that you will be doing a wise thing
if you invest every dollar you can spare in the stock of
the Southern Telephone-Electric Company. Don't let
fears or doubts deter you, but just make a careful study
of the facts as we have told them and then let your own
common sense and better judgment guide you.
Every man or woman who invests in the shares of the
Southern Telephone-Electric Company at the ground
floor price of $25 per share, at which we now offer them, v"
will in all human probability be able ultimately to get
dividends in excess of 40 per cent on the investment or
be able to sell the stock within a short time for many
times its present value. Twenty-five dollars buys a share
today. Partial or installment payments may be made at
the rate of 20 per cent down and 10 per cent per month
until shares are paid for. At the present price of $25 per
share this means $5 per share in cash or its equivalent
with your subscription and $2.50 per share per month for
the next eight months. No interest will be charged on
deferred payments. We want the small investor to par
ticipate in the profits of this great enterprise. We will
give the same attention to a subscription for a single share
as to that for a thousand shares..
Installment Payments on Stock Can
Be Made as Follows :
We are offering the fall paid, non-assessable $100 par value
stock of the SOUTHERN TELEPHONE-ELECTRIC COM
PANY on the following easy terms:
825 buys 1 Share, par value $100. pay down 35 and 82.50 a
month for 8 months.
373 bays 3 Shares, par value 3300, pay down 313 and 37.50
month for 8 months.
3125 buys S Shares, par value $500, pay down 325 and 312.50
n month for 8 months.
3250 buys lO Shares, par value 31000, pay down 350 and 338
a month for 8 months.
3325 buys 25 Shares, par valne 32500, pay down 3125 and
3I2.50 n month for 8 months.
I12S0 buys 50 Shares, par valne 33000, pay down $250 and
3125 a month for 8 months.
You ean contract for any number of shnres. paying for
them in the same proportion. You can pay more down and
more per month If you desire, or yon can pay la the entire
balance due at any time, when a certificate will be Issued.
Make all remittances payable to the Southwestern Securities
Company.
Come to our office, if you can, and we will explain to
you all the details. If you cannot come, fill in the coupon
below and mail to us, with remittance in registered let
ter, or by postal or express money order for the number
of shares you wish.
This announcement is being made in all the important
newspapers in the West today, and without a doubt sub
scriptions to the capital stock of this corporation will
pour in. Owing to the great merit of this investment
proposition and the excellent standing of the management
we have every reason to believe that the small block of
stock offered at the ground-floor price of $25 per share
will be quickly subscribed. For this reason we urge you
to act promptly and fill out one of the coupons below and
send it to our office immediately if you cannot call. .
S0UTHM1 SECURITIES CO.
300-301 TILFORD BUILDING
PORTLAND, OREGON
PURCHASE COUPON
Southwestern Securities Co., Fiscal Agents
300-301 Til ford Building. Portland, Oregon.
Inclosed And 3 in (say whether full
or partial) payment for ..shares of stock of the
SOUTHERN TELEPHOXE-ELECTRIC COMPANY.
x
Name
Iddresa
P. O. 4-21 '