The morning news. [volume] (Savannah, Ga.) 1887-1900, 1893-04-09
THE CENTRAL'S AFFAIRS.
Mr.. PAT CALHOUN AND MR.. CONFER
TALK ABOUT THBM.

Mr.. Calhoun Answers Some Questions
and Asks Some-Mr. Conner Shows
Why Reorganization IS Necessary
and Makes 1t Clear That the Sooner
Reorganization is Effected the Bet
ter 1t VIII be for the Junior Security
Holders.
few days ago Mr.. Pat Calhoun was in
Savannah and proposed to write communi-
cation,to the MORNING NEWS relative to two
statements in regard to Central railroad af-
fairs, made IN its columns. One was in res
spect to an offer to extend the tripartite
bonds at per cent. interest and the other
was in respect TO a statement that when an
per cent dividend was paid the Central
did not earn enough to pay its fixed charges
and interest on its floating debt. Mr.. Cal
houn changed his mind about writing a
communication. and put what he had to
say the shape Of an interview, 1t being un-
derstood that it would be submitted to Mr.
Conner, president of the Central for reply.
The interview is as follows:
"Doyou know whether an offer had been
made TO take up the tripartite bonds at 5
per cont"
81 was so informed yesterday for the first
time and l see it stated in your paper that
before foreclosure proceedings were begun
two Of the strongest financial institutions
in New York offered to carry them for
several years and to agree TO reduction of
interest To per cent. This was not only
news to me, but very great surprise. 1t
will be news to my clients and TO many
other junior security holders. The ques-
ton naturally arises: Why,did the receiver
with the money actually offered at per
cent. permit these bonds to continue
to run at per cent. and thus
entail upon the company an
additional fixed charge Of more than $780,
900 per annum? Why we're not the stock
holders and security holders when daily
threatened with foreclosure informed that
the suit was proceeding, not only with the
consent of the receiver, but that he had
been actually offered the money with which
to stop it at 5 per cent interest! 1t occurs
to me that the junior security holders may
Justly feel that it was not quite fair to
threaten them with foreclosure and not
only not to take any steps to stop the suit
and reduce the fixed charges on their prop
erty 500 900 year, but not even to inform
them of the fact that the money had been
actually offered and refused. on course Is
was more difficult for my clients. being mere
minority junior security holders 10 go
out on their own account and that OK their
fellow stockholders and raise the money"
But, Mr.. Calhoun, it Is stated that the
reason was that the road cannot earn its
fixed charges and interest on its floating
debt. and that foreclosure proceedings will
be- begun on the consolidated mortgage
bond"
CAS- understand it," replied Mr.. Cali
houn, 1.-THE floating debt does not mature
until the first OF next July, and IL must
seam to the average man little extraor-
binary. why foreclosure should be pressed
upon the tripartite mortgage and the road
sold out under the marshaPs hammer in
order to protect a floating debt not yet due.
To sell out their property seems rather a
novel method Of protecting the junior secu-
: But again, Mr.. Calhoun IL is stated that
the road has not earned its fixed charges
and interest on its floating debt at any time
time during the last Eve years, and that,
of course, therefore, the dividends were not
earned :" ,-
az know such statements have been made.
Thev are positively untrue. On page 50
Mr. Conner. the receiver, gives statement
of ali the money borrowed. and received
outside of the earnings OF the property from
oct. l 1886, to June l, 1891.
1rcr1prs AND DISBURSEMENTS, 1887 TO 1871
OTHER THAN EARNINGS.
Recetved-
Sale of Savannah and Western -oo ~,
bonds .,....,....... ...........S 7.1l3,50O 90
aeie collateral trust bonds. .......-. 4,SNOOD %
BilIs payable to March /, 1S92..,.. 4,o2OVO W
sl6,5l8,5OO 90