Evening star., 1896-10-28
BELT AND LEXINGTON
Conditions Under Which They May
Be Reorganized.
THE SYNDICATE MUST Be ELIMINATED
A Better Feeling Prevailing Among
the Interested Parties.
THE ACTION OF THE COURT

There seems to be a somewhat better
feeling today among the financiers inter-
ested in the affairs of the Belt and Eek
ington railroad companies. the action of
Judge Cox yesterday having been taken
somewhat of a guarantee that the fu-
ture movements of the receiver will be di-
rected in a measure by the court itself. The
agreement to the issue of receivers certifi-
Gates for an amount sufficient to meet the
operating expenses of the roads
brought about by some of the conservative
bondholders, who, while averse to seeing
the properties further burdened in order
to indulge in costly experiments. do not
care to them ruined beyond redemption
by failure to keep the lines running with
regularity. The proceeds of the certificates
which will be issued on the authority
granted by Judge Cox yesterday will be
devoted to such necessities as the feed of
horses, the pay of employees and ether
everyday expenses. and no portion of the
moEey will be devoted to equipment in any
form.
Effect of the Orders.
Up to yesterday morning it was doubtful
whether such certificates would be issued
without d contest in the courts, as q num-
Der of bondholders We're known to be alb
solutely opposed to issuing such securities
for any purpose whatever. But when the
case presented to them in the proper
light they decided to make no opposition
to the request. The orders of the court di-
recting that proposals be requested for the
furnishing of air motor and also for
proposals for the full equipment of both
roads with compressed air systems has
had the effect of allaying bitterness to a
considerable degree. and the hope is ex-
pressed in many quarters that replies 20
these proposals will be received from all
the &C mpanies owning patents of such
character, which are now doing business
in this country. In this way the whole
field of compressed air invention will, it is
thought, be open to inspection and the
local companies will not be dependent upon
the Porter motor alone.
Stockholders to he Assessed.
1t was said today by gentlemen heavily
interested in. the bonds of one of the COM
panies that It was error to declare that
the minority stockholders of the two cor
porations had been frozen cut He ex-
planned that the stockholders of the COM
panies were the owners OF the properties
and that the bondholders occupied the DO
sition of holders of mortgages on the con-
Germs. The properties needed Improvement,
ne said, and the owners were naturally ex-
pe2ted to make them. Accordingly II the
roads Were reorganiZed and a system of
rapIu transit Introduced the stockholders
would De assessed for the expense.
lhe suggestion that the roads should be
equipped with compressed air systems, the
expense of which to be met by the is
suance OF receivers certificates, that were
To be 4 prior lien on the property of the
companies, he said, was to the same eff
Iect as 1t would be if the owner of prop
erty desired TO improve his holdings, and
wished TO get the holder of the first mort
gage on 1t to take d second mortgage and
he INN
stand as hrst mortgage against his real
estate Naturally, the bondholders do not
propose to submit to anything of the kind"
Reorganization Under Conditions
careful survey of the case, including
conversations with several interested par
ties, makes it appear that the owners of
the bonds of both roads are perfectly will
ing to assist in bringing about reorgan-
iZation of the companies and in placing
them upon paying basis, provided that
all actual or indirect participation in the
control of the properties by Elkins, Widen
er and Dolan shall be eliminated. The
declaration that the Philadelphia syndi-
cate Is no longer interested in the Belt
and lexington companies NAV be true in
certain sense, but that the syndicate has
powerful influence with the interests that
DO control the road is believed to be be-
yond question About ten-thirteenths of
the Baltimore ard Catonsville Construct ton
company is owned, it Is said, by Mr. T.
Edward Hambleton, the Baltimore banker,
ana MS associates. The other three-thir-
teenths are owned by Elkins, Widener and
DoIan. The Baltimore and Catonsville Com
struction Company controls the Belt and
lexington railroads here, but. like these
roads. Is now in the hands of a receiver.
Inc bondholders of the local properties,
therefore, do not feel perfectly certain that
tne Philadeiphians, through the connec-
tons described, may not continue to have
voice In the direction Of Belt and Eek
inSton affairs, and hence the uneasiness
ABOUT approaching the task of reorganiza-
ton until there is full understanding that
they Will not be permitted to exert a DO
tent influence in the future management
OF the roads