New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1897-11-04
fiuanriaI
financial
New-York. November I. 1891
TO THE HOLDERS OF
CONSOLIDATED MORTGAGE
FIVE PER CENT. GOLD BONDS
OF THE
Baltimore & Ohio
Railroad Company
DUE 1887

Receivers
and Ohio Railroad Company in February 1896 We have
pdeavored to watch carefully and take all steps neces
sary protect. the rights ot the Five Per Cent Conso
dated Bondhollers
Almost Immediately after their appointment the Re
oeivers expressed the opinion that allowed to Issue
So 600 Certificates used for discharg
accumulated supply bills and FOR making some needed
additions 10 the property they could thereafter regularly
the interest the several issues OF bonus iot
which the 3. & o. r. r. Co. directly responsible
ard which constituted principal railroads Vi,
the system.
Recognizing the advantages likely to accrue rom hold
Ing together all the properties ard also understanding
greater part Of the So 10000 certificates were 10
be used discharge supply bills which would probably
be held by the Court to be preferential liens We win
others the Consolidated bonds. favored the
issue 81 such certificates.
or late have been unable to fulfil iher
expectation defaults have taken place on several OF
the lines important the integrity " the system since
these defaults felt that object Of the original
issue having failed further issue u certificates FOR any
purpose should be made by the Receivers and therefore
We have opposed all such further issues.
In the Spring " 1897 the Johns Hopkins University
filed IN application asking that the SJooO0pp
preferred stock Of the r. o. r. r. co. should be
declared lien the income Of the property ahead OF
tie Consolidated Mortgage Bon.s The Trustee OF the
Consolidated Mortgage fled answer whc was deemed
adequate set forth the rights Of the londhoders
days before this application be heard by the
Court learned that This answer had been Withdrawn
by the Trustee and ;at In its stead there had been hsd
another answer merely formal In character. stating that
the Trustee had Views in the matter and leaving the
determination OF the question to tho Court The reason
for this sudden change perhaps be best by tie
Trustee. who inquiry. Informed one % rs that II
differed decidedly with Va IN regard to the H. o. pre-
'ferred stock. and tina, this Idea with II;
that had held this opinion for years long before
1T accepted the OF the Consolidated Mortgage and
that The purpose Of the Company In amending ts an
aver remain IA n neutral position"
Immediately upon hearing Of the changed and "neu-
tral" attitude o. the Trustee on whom had been rely
ing Tor the protection Of the rights OF the bonholisrs
We communicated with q the large bondnoliers.
AMI took Ter Independent Intervention in their
behalf and in behalf Of all other boniholers Although
subjected pressure in the preparation Of papers
the fully presented BY counsel. and
happy 70 say that Notwithstanding the views OF the
Trusted the Court has decided in favor Of the conso
dated Mortgage and has denied tho application OF the
University. We do not know whether the University will
take appeal from this decision. hut II We shall
continue Our opposition
More recently the Trustee Of the Psburgh and Con-
nesilie Five Per Cent Consolidated Mortgage has filed
a petition OF which the granting would In effect be
declaration that It's las lien equal with yours
the main line - the - O. r. Il. We are now Wig
ororsy opposing this application.
We mention these simply % give the holders OF
the Five Per Cent Consolidated Bonds IDEA OF the
unusual phases which matters taking on questions
other ~ r-t Preferred Stock the Trustee
has communicated With AM und indemnity from
Us has allowed counsel cooperate with ours We
30 not believe that Tie Receivers viii default in the pas
ent Z interest except under most dire necessity and 30
long there defaul; in the payment II interest on
bonds tho performance Of the other undertake
ngs u the mortgage. would under ordinary
c.naion 10 any Cor anxiety. But the very un-
attacks the integrity q mortgage apart
default the complications u the present re
ownership. we'll the novel suggestion % ''ncu
trail" TrustreshIp. Indicate necessity for constant
WAichfglncss and vigorous action
II important. therefore. that the bond
holders unit. protect their interests. and. &C
cordingly have prepared Bondhoiers Agreement
which other things provides for the deposit or
boad. with Mcs1rs. : J. MI & Co. and gives us all
necessary power b,niholiers represented
all In well as power II press fore
closure proceedings In case of default
II these purposes commend themselves 10 you. Will you
b. good enough 70 iepor, your with Messrs. J. p
Organ Co. before January 1898. receiving In
exchange therefor Of deposit for which
tatlon IN due time viii asked from the New York
stock Exchange These certificates tor $1,000 each
and bear Ineres. CORRESPONDING to tho coupons
maturing on the the Ave As fast
az coupon, sre collected T. +. Morgan Co will pay the
amount thereof on surrender Of tie corresponding
We canno, underak. represen, bonds which shall
m, have been deposited on or before the Gate abse nG
Gated.
There may be obtained our Offices statement fur
nshei by the showing the eagnngs and fixed
charges o. the property covered by the Consolidated Mort
gag. We believe this statement will be reassurns TO
boraholders t.t also that will show them the necessity
Of not allowing additional Hens to be imposed on the
property covered by their mortgage IN priority thereto Or