New-York tribune., 1908-04-07
TO OBvIATE MORTGAGE
WESTINGHOUSE Plan.
Merchandise Creditors Pr0p0se>Nezc
Way of Ending ReceiUerslip.

The merchandise creditors committee OF the
Westinghouse Electric and Manufacturing Coh
pany has formulated plan for termlhatihh ny
receivership and providing for all cash REQUIRE
ments for a period of five years without paeihs
mortgage on the property. proposed under the
mortgage bond plan announced on January . -
the reorganization committee, OF when Jdhss 4
Jarye is chairman
The new plan. which has been unanimously aP
proved by the directors of the Westinghouse coih-
pany provides, first that the holders OF the mel
chandse debt. amounting 10 appi'N
100000 are to take new fully paid assene"s
stock at par settlement of all their cialrns' -
ond, Mat such of the bank DEBT ahou"'e -.
s. $4,000 as is not converted into assenting stoch
is to be cared for partly by convertioie poi's %
the existing authorized issue atspar OF "hch theie
are available s45S1.O0o and partly by per een'
notes running at least five years; thlro' 'I'a' 'iV
existing issues of convertible bonds, depenture
certificates and collateral trust notes. amounting
in the aggregate 10 s2911.io2, are nor 10 DE o's-
turbed; and, fourth. that the stockhoiders SUD
scribe at par 100000 of new asserting stock
This stock is to be paid for in cash i'm instalments
extending period of ten months. beginning
June l. 1905. The s6.e0.00 of new cash capital, to-
gether with the cash accounts and bills receivable
of s12 s32 72S the working assets of s14e0l6O.
as enumerated in the accountants report OF Feo-
ruary 20 last will give the company working
pital of *3,434,39a which the committee declares
\ should be ample for handling the business OF the
company TO the best advantage.
copy of the proposed plan. the creditors committee
points out that, as the company's funded indented-
will not mature for some time it is not neces-
sary under its plan to make any new provision lot
its payment and declares that the cOnsummatton OF
this plan will all defaults that have occurred
under the agreements securing the funded dept
The circular gives comparison of the hxed
charges under the two plans, which shows that
after the second year when under the mortgage
bond plan, the first sinking fund payment would be
payable. the fixed charges under the merchandise
creditors plan would be 10000 year less than
under the former plan This it declares, should
greatly facilitate the early payment of dividends
on asserting stock. 1t that careful estimate
shows that under reasonably favorable conditions
the company should during the next five years
earn sufficient TO pay all its fixed charges, per
cent year the preferred and per cent on the
entire issue of asserting stock including the pro-
posed issue, and in addition create annual sur
plus OF 81 least 81 10000.
The reorganization committees plan provided,
among other things, for s350oo.0o bond issue.
The stockholders were also required to subscribe
100000 stock at par, which understood.
it would have been difficult if impossible, TO
get them to take because of the large mortgage to
be placed upon the property.
George Westinghouse said yesterday that he
considered the plan favorable for the stock
holders and that he hoped its He said
that 20 cent of the creditors had already as
sented to it, and that it now remained for the
stockholders promptly TO do their duty. Mr.. west
inghouse added that if the plan failed of success
the banking creditors would sell out the property
In other well informed quarters the opinion was
expressed that the plan the only feasible
one under which a readjustment Of the affairs
of the company couJ be made without a sale OF
the property.
1t announced yesterday by the reorganiza-
tion committee tnat since the merchandise COM
mittee had expressed confidence that by June !.
19oS it would be able to put its plan through, the
former committee had deemed ii wise to give the
creditors committee opportunity to accomplish
this result and had extended the time for deposit
ing obligations and claims and including May
10 next The committee stated also that majority
of the convertible bonds OF the three-year per
cent collateral notes, OF the bills payable, ac-
counts payable and of a large amount of the de
benture certificates had already been deposited
under the terms OF the mortgage bond plan IL
will accept the plan, however II the creditors
are successful in getting the stockholders sub
scribe for the asserting stock.