The morning news., 1892-03-19
PLAN OF TEE EXCHANGE.
The Easis of the Deal in Terminal
Securities

/ = 10 L6-lS OF the OEal IN A6EnluhA
Securities.
| The basis on which the existing securities
Of some OF the companies in the Richmond
aud West Point Terminal system are to be
exchanged for new securities to be issued
under the Olcott plan of reorganization u
this: The common stock Of the Terminal
company is 70 be exchanged for an equal
amount OF the common stock OF the new
company and receive besides 10 per cent in
new preferred stock. The present preferred
stock is TO be exchanged for an equal amount
OF new first mortgage 4 per cent. bonds
and receive 20 per cent. In new preferred
stock. The Terminal 6 per cent collateral
trust bonds are 70 receive 100 per cent. In
new first mortgage IS and 40 per cent. in
preferred stock. The per cent. first
mortgage collateral trust bonds are TO be
exchanged on even terms for first mortgage
Is, and receive 10 per cent. in preferred
stock.
East Tennessee, Virginia and Georgia
railway first preferred stock will receive 80
per cent. os new first mortgage As, so per
cent. OF preferred stock and 30 per cent of
common. The second preferred stock will
receive 35 per cent. Of new preferred and 65
per cent. of common stock. This common
stock will be scaled TO 80 per cent. of new
common. The first mortgage 7s will rsceive
preferred stock. The frst mortgage IS will
receive 105 per cent. in new As aud so per
cent. in preferred stock. The new
consol 5s are TO be exchanged
on even terms for new As, so per cent in
preferred, aud 25 per cent. in common
stock. The first extension mortgage IS are
entitled TO an equal amount OF first mort
gage 4s and 20 per cent in common stock.
The Improvement and equipment Sc are en-
titled to an equal amount Of new 4s aud 20
per cent. In preferred stock. The Cincinnati
extension 5s will receive 80 per cent. In new
4s and 25 per cent. in common stock.
As l03 different securities are treated in
the plan, it is obvious that each security
holder will have TO secure copy of the
plan if he wishes to know how he Is to fare.
An important feature OF the plan Is the
rights which are given TO the stockholders
of the Terminal common and preferred
stocks and collateral trust 5 per cent. bonds
to subscribe to the securities Of the new
company. Each holder OF 100 shares OF
these stocks and OF each 81 900 bond is en-
titled TO subscribe 81 600 TO the cash fund Of
SASS, GAO which is necessary to meet the
cash requirements Of the plan. For such
subscription OF $1,000 they will receive
g., 900 of new per cent. bonds and 800 of
new preferred stock. Holders OF less
amounts than 100 shares of stock and 81, 900
bond may subscribe to the new securities In
the same proportion. A bankers syndicate
has been formed by Messrs. Hallgarten &
Co.. which has guaranteed the entire SUBJ
scription.
The New York Times throughout the
time when the Olcott committee was at
work on its plan, was inclined to take a
gloomy view of Terminal affairs. The fol-
lowing from Thursdays issue. indicating a
decided change Of front on the subjecs by
the paper, ia considered significant: "The
Richmond Terminal reorganization plan is
finally issued, and people who look into it
will find that It Is good deal different from
what the street has been expecting. 1t is
much more conservative; IL is much more
likely to be successful. The chief embar-
rassment in the plan is for the gossips who
have been industriously insisting that there
have been disagreements on the inside
which will upset the plan. II is found,
however, there has bsen harmony on every
matter Of consequence. and that the elab-
orate plan of reorganization represents all
interests"
Brokers in Savannah who bought Central
railroad stock and dehentures more or less
freely in the belief that the Central was to
be included In the reorganization scheme,
figure out that they would have realized, by
selling the new securities on the New York
Stock Exchange at sD910o per share for
their stocks and debsnt1res. Mr.. Roun-
trees lLtAe burprlSo mas. nOWeV6rs Knockeu
their calculations into a cooked hat. 1t has
also knocked the minority holders OF Gem
trail out Of a chance TO realize fair cash
equivalent for their holdings, at least until
the present cloud blows over There
is a suspicion among many people that the
present suit may have been brought in the
interest of the Terminal people, in order to
have the legality of the lease proved for the
satisfaction of the New York bankers who
are now at the back of the Terminal psople
Brokers think Mr.. Rountree proved him.
self very poor business man by failing to
induce his father TO sell out his stock before
the suit was brought. Had he wanted to
buy it back he could have replaced it several
points lower since the filing of the suit In
other words, Mr.. Rountree should have
gone short on the market. from the brokers'
point of view.
At present there is nothing doing in
Central securities. Holders refuse to acri-
fee their holdings and are waiting with
considerable confidence for favorable
turn in the market from some source, while
prospective buyers are holding aloof wait
ing to see which way the cat is going to
jump before coming into the market.