Evening star., 1896-06-26
WILL BUY THE BONDS
Important Transaction in Baltimore
and Ohio Bonds.
ENORMOUS SAVING Of INTEREST
What Receiver Cowen Says Will
Be Paid July !.
JOHNS HOPKINS HOLDINGS
JOHNS HOPKINS HOLDINGS

| furnishing the money to keep the Baltt-
| more and Ohio railroad going was made
yesterday. when an authorized statement
was sent to the bondholders of the Pitts
| burg and Connellsvile railroad. signed by
| Speyer & Co. and Vermilye & Co., bankers
| In New York, that in accordance with an ar
rangement entered into between them and
the Baltimore and Ohio Company, the les
see of the former and the receivers of the
Baltimore and Ohio, they would purchase
| the bonds of the Pittsburg and Connels-
| Vile road, which become due July !, 1888,
| amounting to $,OO000O. The Pittsburg and
| Connellsville line was the creation of the
| late John w. Garrett and those capitalists
! who were associated with him in his rail-
way deals during the ten years preceding
his death. The company was organized
| and the road built to give the Baltimore
| and Ohio connection between Cumber-
| land and Pittsburg. The line is $50 miles
| long, and is built in the most substantial
manner. 1t is not only one of the mos
| important links in the Baltimore and Ohio
| system, but is the only way by which the
| parent company can get Its trains into
| Pittsburg from the east. Besides 1t has
| great earning power. as the route abounds
| in coke furnaces, big iron mills and other
| manufac curing enterprises, and 1t is a
| n after of the greatest importance that Il
| should be kept in direct touch with the
| management CT the Baltimore and ONO
| system, and part of the latter.
| Unfortunately, however. when the bonds
| were issued they were made to bear I per
| cent interest. and 1t has been found by
| those in authority that If the bondholders
| are to receive any interest it will be nee
| essary for them to consent to surrender
| their present bonds and accept a fifty-year
| per cent bond. Under this arrangement,
| which Is said in Baltimore banking circles
| to have the approval Of j. p. Morgan g.
| Co, through the receivers, the company
| will be able to save $4,000 year in in
| terest charges, which by the time the bonds
| become due in 1916 will have amounted to
! the sum of $6,O0O,OOO or 100000 more than
the face value Of the present bonds.
Offer Will Probably Bc Accepted.
| The impression among those ccnversant
| with the actual state Of affairs as regards
Baltimore and Ohio matters is that the
offer of the bankers named to buy the
bonds of the Pittsburg and Connelisville
railroad Company Will be accepted by the
| be ndholders generally, and that in future
| dividends on the bonds will be paid reg
| ularly every six months. The offer of
Messrs. Speyer & Co. and Vermilye & Co,
| which, to lie effective on the part Of the
| bondhoaders must be accepted by July -,
| is as follows: The holders of these bonds
| have the privilege of presenting their bonds
| at the offices of either of the two firms in
New York on or before the date named
| July II neXD, to be stamped. in which case
| they Will receive $50 in cash for their July
| l. 1896. coupons. and in addition thereto
difference between per cent and per
| cent interest on the bonds to July J. 1898,
| under discount at the rate of per cent per
| annum less $40 per bond deducted con-
| siderauon for the extension. The holder
| Of each bond so extended will, therefore,
| receive in all S12 in cash at the time of the
| extension, and his extended bond will bear
| interest from July ], 1896. at the rate of 4
per cent per annum in gold.
| The existing per cent coupons for in
terest from July /, 1896. to July /. 1873,
will be detachable from the bonds. new
sheets Of coupons for interest at per cent
| for the full term of the extension being at
tached. and such coupons to the extent of
s15 each, together with the July 1. 1896.
their agreement with the railroad com
pany, uncollected if required for the period
| OF two years.
A Proposition to Purchase.
The same banking houses also offer to
| buy from all bondholders who do not avail
themselves of the above privilege their
| bends, with the July l, 1896. coupons, and
| all subsequent coupons attached, at s1O92
| IN cash per bond. with such coupons. pro-
| vided their offer is accepted, and the bonds,
with coupons attached, be offered to them
on or before July Is.
Receiver Cowen of the Baltimore and
| Ohio said last evening in Baltimore that in
terest amounting to over S20O,0O0 on the
bends OF the company. which will be due
July !, will be paid on maturity. This does
stock which amounts to $3,OOO,OO0 and in
| which the Johns Hopkins University. as
heretofore stated in The Star, is interested
| to the extent of 81 100000 while the re-
naming s1.90O,0OO is held by other Balti
more parties.
This determination on the part of the re-
| ceivers caused no surprise in Baltimore,
railroad and banking circles and a promi-
nent banker of that city, in speaking last
evening Of the matter to a Star Reporter
sa1d: 1t VIII be remembered by those who
nave taken an interest in Baltimore and
| Ohio affairs that three weeks ago an or
ganizaticn was formed, which was com
posed of the holders of the stock referrei
to, and that 1t was. as it is now, their
aNoWed purpose to take legal steps in ref
erence to the matter If the dividend, July
| l., was not paid. committee, composed
OF Messrs. James L. McLane, a leading
| lawyer and ex-railroad president: Cen
John Gill, president Of the Mercantile Trust
and Deposit Company, and John A. Whit
ridge, a prominent banker and capitalist.
fag mas Snarge or the whole subject, and as
1oreshadowed in The Star a few days ago
VIII present the July coupons at maturity
| ara demand payment therefor Failure to
eeoin see ,heir money OF as it is now assured. will,
CoWen, cause an appeal to the courts
The claim of the holders Of the first pre-
| derred stock is, as already stated in The
STAR that 1t is prior lien bearing per
cent on the gross revenues of the COMPANY
| ana that the coupons must be paid before
| any other interest is paid.
| Inc payments for interest that will he
| made, as stated by Receiver Cowen. are
| these: Loan Of 1853, amounting to So 41o
bord, to the city of Baltimore, to purch,sa
Its interest in the Pittsburg and ConneIIs
vile Railroad Comr any, $4,000; Northwest
ern Virginia Railroad Company, popularIv
| known as the Parkersburg branch of the
| = and o., 400; consolidated Pittsburg and
Conneilsvllle mortgage $3.50, ,446 -; also on
| Baltlmore and Ohio trust bonds of 1SS1
| and on the Winchester and Potomac Rail
road COmpany'S bonds"
BaltfmOre's Holdings,
In this connection it is quite interesting
to state that Mayor Hooper of Baltimore
yesterday accepted, on behalf Of that CITY.
| an offer of Mr.. Eugene Delano, q New
| York banker, to purchase the entire hold
| ings OF the city Of Baltimore in the Pitts
| burg and Connellsville road, amounting to
| $2OOOOO, at par.
Receiver Cowen also authorized the state
ment that 1.-The equipment mortgage for
s., 100000 from the Baltimore and Ohio
| Equipment Company, the Baltimore and
Ohio Railroad Company and John K. Cow
| en- and Oscar G.. Murray. receivers to the
| Mercantile Trust and Deposit Company
| of Baltimore, for which the United States
| court at Baltimore recently authorized the
| issuance Of receivers certificates, has been
put on record. The certificates to be is
| sued under the mortgage are to be dated
| June 1. 1899 and the mort gage wac rn,ao