The herald., 1898-11-18
STOCKHOLDERS OBJECT TO RE
ORGANIZATION
BANK CONSOLIDATION ABROAD
The Postal Check Idea.
Dividend Notes
OFFICE OF THE HERALD,
Los Angeles, Nov. II, 1898.

Los Angeles, NOV. II, IoSo.
The scheme for the reorganization of the
Central Pacific as outlined by &. z. Hunt
ington does not appear to have attractions
for the English stockholders. According to
u dispatch to the San Francisco Examiner,
for the English stockholders. According to
cific railway who were persuaded by Coils
Z. Huntington to buy that stock at high
prices are ready to fight vigorously against
any invasion of their rights in the efforts
being made by Huntington to arrange for
the payment of the government debt at the
expense of the present stockholders. Hunt
ington and his associates are trying to re-
organize the road on basis similar to the
recent Union Pacific DEAL though, il possi-
bic, with less consideration for the govern
ment than the journal compelled the Union
Pacific syndicate to show.
The committee of English stockholders
have now begun proceedings to restrain the
board of directors from putting new mort
gage on the property to take up the govern
ment loan and pay the first mortgage.
This information was received today in a
cable from w. Morshead, the chairman.
The stockholders realize that if the gov
ernment debt is paid by an enormous issue
of bonds it will practically take from them
all their equity in the property, as the new
bonds will take precedence over the stock
As Huntington owns the bonds and but lit
tie stock, his sympathy is, of course, with
the bondholders.
Through the selling of big block of the
proposed new bonds and compromise with
the government the debt could be settled,
but when it was done there would be little
for the stockholders. This is the basis fer
their opposition.
Speyer & Co. announce that they will re-
ceve subscriptions at ll01a and accrued in
terest for $40, 100000 Southern Pacific Rail
road company of California per cent first
consolidated mortgage gold bonds, due No
vember !, 1897. Subscriptions will be re-
ceived simultaneously in London, Frank
fort -on-the Main,. Berlin and Amsterdam
thus creating an international market for
the bonds. The bonds are redeemable at
the option of the company on or after April
!, 1905, at 1919 and accrued interest, upon
giving six months previous notice. The
interest is payable semi-annually in May
and November. The principal and interest
is guaranteed Internationally by the South
ern Pacific company of Kentucky.
The above telegram refers to number
of Central Pacific stockholders in London,
who belong to the Marriott -Morshead fac
ton. The latter is opposed to the Banbury
committee and its continued support OF O.
p. Huntington. The two latter have agreed
upon a plan of settling the CentraPs gov
ernment debt and recognizing all of its
other bonded debts by floating big blanket
mortgage of $l05,000, 900. In this way they
expect to keep the Central Pacific out of the
hands of receiver and to prevent subse-
quent foreclosure and sale by the latter.
The blanket mortgage scheme has not yet
been sufficiently developed to be brought
before the Centrals directors in this city
for their formal approval.
Just what effect the suit filed in London
will have upon the mortgage scheme no one
in this city seems at present to know. The
local Central Pacific people do not think
the suit will amount to much. According
to them, Mr.. Morshead and Sir William
Marriott represent an nconsequential
amount of stock, while the Banbury COM
mittee has the support of 342, 900 shares out
OF total of 10000.
Several weeks ago Messrs. Morshead and
Marriott came to this country and CON
fcrred with the Washington authorities rel
ative to the settlement of the Centrals gov
crnment debt. They stated to Attorney
General Griggs at that time that they fa-
vored receivership and foreclosure pro-
ceedngs and were bitterly opposed to the
Huntington influence in Central Pacific af-
fairs