New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-12-17
U. S. LEATHER PLAN OUT.
ARMOURS INTERESTED.
Nesr Company To Be Formed so'th
$50. 900 900 Stock.

r.nt Of the affairs of the United States Leather
Company was made public late yesterday atter-
noon as part of a circular addressed 10 the
stockholders by a stockholders committee COM
posed OF P. A. Valentine, of Armour q Co.,
chairman; President Edward c. Hcyt, and A
Augustus Healy. w g. Garritt Eugene Horton
Samuel P. Davidge and Lewis H. Laphan1' di-
rectors of the United States Leather Company.
four OF these directors being also members OF
the executive committee; T. P Olcott. president
Of the Central Trust Company; Alvin w hrech'
president Of the Equitable Trust Company ana
George Foster Peabody. of Spencer, Trask q Co
The bankers TO the committee Kuhn. Loeo O.
Co, who. it is said. have never before taken
part in the financing reorganization OF an
Industrial" and its counsel are Edward NJ
Shepard and 1. c. Krauthoff.
Under the plan company is TO be formed
10 acquire not less than majority of the en-
tire capital stock Of the present company ana
TO have an authorized capitalization of S45-
10000 twenty year per cent first lien gold
bonds. S400000o0 per cent cumulative pre-
ferred stock and S40.0O0000 common stock The
net and final distribution OF securities of the
new company is intended to be as follows:
To holders Of the SCI. 2S2 800 outstanding pre-
ferred stock for each share Of such stock with
all its accumulated dividends. $40 in bonds OF
the company (making total OF Sol, al
$50 bonds applied to this purpose, if the holders
of all Of the outstanding stock of the present
company shall assent TO The p!aR). 900 IN new
preferred stock Cor 4lloo OF the preferred
In alb and S23 30 in new common stock Tor
total OF S14 $685. $40 50).
To holders of the present common stock OF
which 62,SS2.3o0 is outstanding. for each ten
shares of that stock three shares of the new
common stock representing in all S1SS64 $50
new common stock.
To interests, for their cooperation and
for all services and expenses whether legal, of
committees, bankers otherwise, in consum-
mating the proposed plan, $6,2ooooO new COM
mon stock
Reserved TO provide for the retirement and re-
uemption of the $52S0oeo outstanding debent-
ures OF the United States Leather Company, 10
acquire additional properties. TO provide addi-
tional working capital and for the general pur-
poses OF the new company SD eoo,Soo OF the new
bonds. SS,S5S,SJ0 new preferred stock and SOS
S69 30 new common stock.
The $40 600 600 new bonds are TO be secured
IF and when the lands and assets now belonging
10 the Leather Company shall have been &C
Quired by the new company by first lien
upon the said assets including first mortgage
of all lands owned by the Leather company and
pledge of all the stocks and securities OF lesser
companies owned by the Leather company.
Pending the acquisition Of such assets and lands
by the new company. the bonds will be secured
by q pledge of all the shares and securities Of
the Leather company. of its subsidiary COM
panles, which may be acquired by the new COM
pany." The new company is TO acquire the
majority OF the present capital stock until there
snail be ready for transfer such amount OF the
present outstanding preferred stock shall be
approved by the committee, provided that such
approval shall not be given until at least ma
5ority of the entire stock of the present company
shall be SO ready for transfer including not less
than one-Quarter of its preferred stock and
provided further that such approval shall he
given when two-thirds Of the entire present
stock shall be ready for transfer.
The new company, it is expected WILL as soon
as the support OF the plan by stockholders OF
the United States Leather Company shall be
sufficient, in such lawful and suitable manner as
shall be determined upon, acquire the physical
assets OF the present company, and thereupon
directly take over and conduct its business
Pending the realization of this expectation the
operation and administration of the present
company viii lawfully and properly belong 10
the holders of majority of its stock
In presenting the plan the committee says
that ]. Ogden Armour and +. A. Valentine. the
president and vice-presdent, respectively. of
Armour & Co Of Chicago have acquired
substantial holding Of the shares of the COM
pany. and recently asked the members of the
executive committee TO consider the question
Of their cooperation with the other stockholders
10 promote the interests Of its business. The
present plan has been prepared in conference
with MessTs. Armour and Valentine. and has
their approval and support.
The considerations which have made il ad-
Visabe, in the judgment OF the committee TO
form a new company to take over the property
and business Of the present company are set
forth follows:
The provision OF the charter according to
the preferred stock an s per cent cumulative
dividend has by reason of the limited. although
very substantial, earnings of the company re-
suited in an accumulation of dividends TO the
holders Of such stock which Will. on January !,
1905, aggregate 41l2 per cent Of its par value.
paid, and being paid, on such stock at
the rate OF per cent per annum, thus involving
an annual increase of per cent in the arrears
The charter contains no provision authorizing
an Increase Of the preferred stock. and the
statute applicable requires for its issue the as
sent Of two-thirds of each class of stock, pre-
ferred and common. And the charter contains
provision forbidding the company, without
the consent Of so per cent Of its outstanding
preferred stock. 10 incur any bonded or funded
Indebtedness other than the S5.SS00O0 of the
present series Of deben1ures Of the company;
and they must be retired the tate of $500. 600
q year. These features Of the charter are seri.
Gus obstacles TO the wholesome and necessary
extension of the companys business and to the
acquisition Of additional property; and they
thus obstruct the development Of the company:
full earning capacity
The officers and other large stockholders ot
the company have. besides. been convinced that
the esta blshment of closer relations with inter
ests with which this company necessarily has
large dealings and the Yesting in them of sub
stantial amounts Of the securities of the com
pany, and especially Of its common stock, will be
material benefit to the company and TO both
classes Of its Stockholders
stockholders asserting to the plan may de
post their stock certificates Endorsed for trans
fer in blank. or before February II with the
Central Trust Company. which will issue against
them negotiable certificates: but the committee
IS empowered 10 change the date after which
such deposits VIII cease TO he received. The
members of the committee ''unhesItatinglv rec
Ommend" 10 both classes Of shareholders of the
present company that they promptly denosi;
their holdings with the trust company and ex-
press the belief that the successful consun1rna.
ton Of the plan VIII greatly tend TO the advan.
tsge Of all asserting stockholders. They add
that the plan has been informally presented tC
a number Of large holders Of both classes OF
stock, who have given 4 their unqualified an.
proVal and acceptance
The report Of the United States Leather Com
pany for the fiscal year ended December 81 1903
showed profit and loss surplus Of ST. ,534 ::}S.,
comparing with s.. 46o. $50 or December 81 1900
The increase was due principally to reappraise,
Inent OF the timber and bark lands principally