New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1889-10-26
To the Holders of
Missouri, Kansas ( Texas
Railway Company
SEVEN PER CENT.
First Consolidated Bonds.

The undersigned, acting Committee in your be
half have considered the plan OF reorganization formu
lated by the Executive Committee OF the Railway Com
pany and regret that they are unable TO recommend
1t to you for acceptance.
Under It you are called upon 10 give up per cent
interest per upon your bonds receiving nothing
in exchange beyond priority Of interest over all other
bonds for five years, but how this IS to be Sc
cured to you f. not stated
For your overdue interest to June l, 1880 amount
ing to 16 IL per cent. you to receive in cash
IL per cent, in per cent. bonds IL per cent,
and the balance in preferred stock
The plan contemplates fixed charges of So 074 800.
Inasmuch the major part Of the earnings is derived
from the operation OF that part Of the property upon
which your bonds are first lien, It would seem that
II reliance be placed upon this estimate OF net
earnings, no sufficient Is offered why you should
fOregO your full rate of interest Of seven per cent
Recognizing, however the desrability OF maintaining
the property, II possible. in its integrity, your Com
mttee have been and still are in favor Of recommend
ing to you that you should forego portion Of tho
agreed rate Of per cent upon your bonds provided
you could obtain such additional security as would be
reasonable equivalent for tho sacrifice. and provided
ALSO that something in lieu Of the dlminuton Of in
terest should be given 10 you In junior securities,
which would inure to your benefit in of future
increase in the earning capacity OF the property.
The six and five per bonds issued under the SIX
per cent consolidation mortgage amount 70 at least
$4,000 per milo, involving payment for interest
much larger than can be counted upon with safety.
To command confidence in its stability, plan Of re-
organization should reduce absolute fixed charges TO
point fairly within the earning capacity Of the road
at all times leaving the difference be represented
by an Income Bond Preferred Stock,
the interest or dividends upon which would only be
paid if earned.
II no arrangement can be arrived at upon this
basis, it Is manfestly for your interest 10 take the
property which your mortgage, for which pur-
pose we recommend you TO sign the requisite papers
empowering the UNION TRUST COMPANY OF NEW
YORK to demand possession as your Trustee. copies
of which may be- had at the office of the Trust Com
pany, No. 20 Broadway, New-York
over SIN MILLION DOLLARS OF the SEVEN PER
CENT BONDHOLDERS have already followed the
recommendation Of the Committee and signed the
papers required by the mortgage, and 1t needs but
one million and half dollars of bonds more 10 en-
able the Trustee to act.
1t is obviously the course OF wisdom. for you to
strengthen the hands Of your Trustee and II possible
place it in possession Of the property thereby insur
ing pending foreclosure proc edings the application
toward the payment of interest upon your bonds Of the
net earnings which have been diverted by the Re
ceivers to the improvement and construction Of the
Texas portion of the road not included under your
mortgage and finally enabling your Trustee, when
the sale IS made either TO buy in the property for you
or to sell it for your benefit at its real value.
EDWARD KING,
WILLIAM LIBBEY,
p. GEDDES, Committee
r. FULTON CUTTING,
WM a. READ
New-York October 25 1850