The sun. [volume] (New York [N.Y.]) 1833-1916, 1892-04-11
THE R. I. REORGANIZATION.
MIR. OLCO7T Is CONFIDENT THAT IT
VILE BE EEFECTED.
Dimcni.irs Of tao Wori - Hint. That Light
May Be Let In on Some Qua Transaction
Underlying Liens of Doubtful Value.

May B- let In some O,d Transaction
Underlying Liens OF Doubtful Value.
Nbook could bc written about railroad re-
organizations. II would DO interesting read
ing. and probably be tho means "f saving to
the average investor n good deal Of money.
Tho usual default. rccciverslip chaos. and
resurrection through u reorganization com
mitteo is perhaps. Notwithstanding its severity
on the mass of security holders tho simplest
and the best understood method. Tho sale OF
the property for tho benefit OF bondholdcrs and
its purchase for tho benefit OF tho security
holders who have become parties to an agree
mcnt is method we'll comprchcndcd, although
| IL is sometimes disappointing to those security
| holders who havo elected to DO u small
| minority.
| Such denominations as those Of tho Cotton
| Oil Trust. the Sugar Trust. and the proposed
| reorganization of the Standard Oil Trust arc
| of n different order rendered necessary be-
cause of the public clamor against trusts
Tho difficulty consisted in bringing tho stock
holders to one mind as to how tho reorganizn-
ton should be effected. Tho first named was
probably the most tedious and has the deepest
history.
Two OF tho most interesting OF recent re-
organizations wer, tho Missouri. knnsns and
| Texas and tho Atchison. Under tho FIRST
the largo cash requirements tabout $4,000
OOo) to pay of tho old pcr cent. bonds. all the
securities wcro deposited. tho reorganization
was effected without foreclosure and sale OF
the property. and the new londs to provide
the cash requirements were all subscribed for
and tho bankers guarantee syndicate was
prevented from acquiring the profit that should
properly go to the old security holders.
Tho Atchison. with its qualifications OF Sc
| curities. was practically voluntary rcorgani-
| zntion. The security holders. although at first
| dissenting. ultimately recognized the neces-
sity of tho situation, and the result was proba-
| bly, more far-renching in its beneficial effects
upon railrond securities than any previous
| reorganization.
The Richmond and West Point Terminal
Railway and Warehouse Company situation
seems to be more desperate than tho ono
which led to the Atchison reorganization;
| The success Of the plan Of reorganization Will
be stu VIM IT. ho th cnSSla
Of relieving great deal Of depression In the
South Prompt payment Of LABOR and supply
t tnv n ar" coStrae,ed. 4 DEVIATION Of this
money. which represents local capital to pay
interest and 70" To- ihfynf ilo",
the deposit Of securities last week with tho
Central Trust Company, and the change in
sentiment toward the plan. indicate that by
Aprl ii which is the date named for closing the
books, the Terminal security holders will have
serve serve their property The committee will then
| probably be In !. position to discriminate he
| tween those having personal designs upon the
property and those who arc working for the
! general interest Of the security holders Tho
| personnel OF the committee and its record I'M
der similar circumstances compcl the coneIu-
sion that its action will be prompt and conclu-
sive that tho reorganization will progress
without delay. and further lmpediment Will be
| rendered impossible.
As to tho securities Of the auxiliary COM
panies. tho committee will without doubt look
closely into the circumstances under which
some of them were issued, and guaranteed.
tn, uni hs hsh s1 M of tho
ruired. In the interest Of tho Terminal stock
! holders. some ofthe transactions referred to
covering for the benefit Of tho Southern Rail-
way Company profits that were secured bv
The reorganization when completed will be
| due to the good sense of the security holders.
| who have voluntarily come forward in TINS
emergency to protect themselves ana Their
,,ALpASy, Arril G-Mr:, Frederic r olc (,
been iii here for the last two weeks at tho
homo Of his BROTHER. Mr. Dudley oicntt, ir r IS!
dent Of the Farm.rs and Mechanics ,, 'anK t
o' Hs fH 2 to Eiehm"ni Terminal matters he
ton and that he is thoroughly cognizant Of
| the situation. no SAID: lie cOnNlttce OF
| which am Chairman has not considered any
! change or modification Of tn" present plan.
! and have every reason t. believe that the
| proposed. The deposits of securities with
| the Central Trust Company are very cncour-
The status.of the 0O.oOo.ooO of securities
| issued on the Terminal system Is Intricate:
| There may be twenty-five or thirty millions OF
| tho underlying securities that Will not avail
| themselves of the plan. Their assent is not
| essential TO the success of the plan. Tho Sys.
| tom which has grown from the Richmond and
| Dnnville Railroad Of 10 miles to nearly 5000
| miles. Is held together by means II stock
| Of reorganization is the first step toward grad
| unl and legal consolidation
"The committee has no reason to dcviate
| from this tlnusr of the plan. which appears to
| cover all that can be said on tn" subject:
| 80 Tho committee finds that the various sys-
| tens have not been operated throughout for
| the common benefit OF the controlling interest.
| but that they have competed among them
| selves for business. each system ma ntai ming
| separate organizations for obtaining bust
! ness. This has necessarily resulted in largo
| dimnution of not earnings OF tho property
as II whole and in an increase OF expenses:
| the properties. and ruinous sacrifice OF secur:
| ties are inevitable unless q remedy he applied
| without delay. In the judgment OF tho COM
| mittoa the only adequate remedy which can
| he adopted is to unite the several corpora
| tions. MS far ms practicable. in one system.
under ono management and to consolidate
| their obligations.
Mr.. Olcott expects to be in New York to-day.
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