Evening star. [volume] (Washington, D.C.) 1854-1972, 1898-11-29
DIVIDENDS IN VIEW
B. and 0. Gompany's Prospects Under
Reorganization.
TEE REDEMPTION OF CERTIFICATES
Opinion ofa Leading Banker Touch
ing Annual Report.
SUCCESS OF RECEIVERS

Day by day steps toward the reorganza-
| ton OF the Baltimore and Ohio Railroad
Company are taken by the company which
| Is to control 1t after the preliminaries to
| mat end have been completed, and it Is
| stated that when the new management
| takes actual charge of the great property
there will nothing remain to be done to
| prevent the stockholders from thencefor-
! ward getting good-sized dividend on their
| investments.
| Ine most recent transaction of this kind
| was the granting of authority by Judges
| CON and Morris of the United States cir
| cult court at Baltimore to Receivers Cowen
| and Murray of the Baltimore and Ohio rail-
| ROAD to carry out an agreement made with
the banking firm of Speyer & Co. of New
YORK for the early redemption of the s., 900, =
ooo Baltimore and Ohio receivers certiti-
| Gates maturing June l. 1899. Notice has
| peen gwen that these certificates will be
| paid this week
The IOoo,OOO issue of certificates was
made under authority of the order of court
! OF May Il, 1896 These certificates bear 6
! per cent interest. The issue of 1856 900,
bearing . per cent interest, was authorized
| py the court November 90, 1896. Both is
| sues were made redeemable June l. 1897
ana after, upon thirty days notice. such as
| has been given.
Under the arrangements made by the re-
| cefers Speyer d Co. are to advance the
| money necessary to meet the principal of
| the certificates as presented. AS each GER
| t1hcate Is taken up the receivers will de-
| tach the present per cent or per cent
| interest warrants and stamp on the face of
| 1T the following: This certificate is paya-
| Die at any time before maturity at the op-
| ton OF the receivers or of the court and
bears interest until paid at the rate of 3
per cent per amman only" The certificates
| so stamped will be delivered to Speyer & Co
| to be held by them as security for the money
advanced and without impairment of the
| lien OF the certificates except as to the re-
| duction of interest.
| Saving in Interest.
| In their petition asking authority to make
! the arrangement with Speyer & Co the
receivers stated that the interest on the s
| per cent certificates amounts to more than
| $500 a day. and that the arrangements will
| save about $4,000 in interest payments on
| both issues. 1t is, therefore, desirable that
| interest payments shall be stopped at the
| earliest possible day.
There is every probability the petition
| also stated, ,that a1decree for the foreclos-
| ure and sale, of the railroad property will
| be entered shortly. and that the property
| Will be sold "A considerable time before the
dates OF maturity of the certificates. In
that event IL. is advantageous to have the
| certificates b: dischargeable Immediately,
either by the purchaser of the property or
| with Speyer & Co, it is declared. will bene-
| fit all interested In the railroad property
| and can injuiIously affect no one.
Speaking of the present condition and flu
| ture prospects of the Baltimore and Ohio
Railway Company, Il leading Baltimore
| banker who. was among those who criti-
| cised the policy of the receivers in contnu-
| ing the payment of interest on all bonds
| and the issuing Of millions Of dollars of re-
! ceivers certificates. which became liens pri-
| or to the mortgages to be used in rebuild
| ing and re-aqulppins the road, said to a
Star reporter:
I Pleasing to Stockholders.
The annuaf report of the Baltimore and
| Ohio, in the favorable results disclosed
| must be pleasing to all the security holders
| of the company. But we imagine the man
| ayers of the ioad will derive special salts
| faction from It. To them 1t means the full
fllment of their expectations, the justifica-
| ton of their policy. Seldom Has the man
| agement of property in a receivers hands
| heen so bitterly assaled were the re-
| ceivers Of the Baltimore and Ohio when
| soon after their appointment, they entered
| upon policy which is now yielding such
| gratifying results Proof of the success of
| the policy, too, mas come very quickly for
| it must be remembered that it Is only
| little over two and half years since the
| receivers took charge, they having been ap-
| pointed in FEBRUARY, 1896.
1T must be admitted that the policy pl,r-
sued was an unusual one, and like policy
| might not be justified in other cases 1t is
| common enough to find the receivers of the
road improving its condition and raising its
| standard out of money provided from cur
| rent revenues. the security holders going
| without any return. But the Baltimore and
| Ohio managers did not stop there. Besides
| using current earnings with great freedom
| they raised enormous amounts of new cap
| ital. Millions upon millions of dollars were
provided by the issue of receivers certifi-
| Gates and money was spent with apparent
| - in a1t rfv-ya
| promoting the capacity and efficiency of the
| plant The addition of new cars was on a
| plan that seemed perfectly astounding
| some of these being provided through tn
| issue of car trusts ard others through the
sale of receivers cert:fca tes To those not
acquainted with the property's needs or
| lacking the capacity for looking into the
future possessed by the receivers this
prodiSality in expenditures had very much
| the appearance of recklessness but If is
| evident enough now that the policy was net
/ carried Il step too far.
Latitude to Receivers.
| Ordinarily, the capital needs of an en-
barrassed road are not met until reorganf-
zat1on In this case they We're supplied TO
| an enormous extent in advance of reor-
ganlzation. Never before have receivers
| been allowed the latitude accorded the Bal
| timore and Ohio receivers in this affair AS
| Already stated, such OUTLAWS by a property
| in the hands of court are justifable only
| In the exceptional circumstances existing in
this instance. No doubt the generally ac-
| cepted theory that the main, if not tire
| only, duty of the court is to hold the prom
| erty together as going concern, until tn.
| creditors can themselves provide for its
| future operation, is sound. But the Ralti-
| more and Ohio situation was one of ex
| IRENE urgency, and the exigency is such as
to demand immediate action. ANY other
course would have invited decay. with
heavy losses to every interest in the prop
| erty." f
| Returned Heroes Banqueted.
banquetiwas given last night at Mari
| rers' Hail. 1tfr street batuaan AZ "a n,