The Washington times., 1910-09-27
Real Menace in Gas Company's Reorgan.
iZatiOn Scheme.

It we'll the people Washington pause their daily
pursuits long enough fix firmly their minds just IS that
their old friend the Washington Gas Light Company proposes to do
at the special meeting Of stockholders October a.
Fgatvely speaking, the company going slice its melon
The Washington should know the details sng
enough that he should merely know that insiders being
enriched his expense He should be thoroughly informed
how the enTng accomplished His attention therefore, invited
the following If he reads he will going happen
Cas- Monopoly stockholders approve
plans recently promulgated b. The board Of directors The plans
alike in Of their features Both provide that in future all improve
men betments and extensions be paid with money derived
from bond sales both provide that future dividends be paid
upon the fair value OF ali the property the conduct
business instead upon the value of the stock provide
for refundng the compan s59SOO bonds With equal
amount o per cent bonds
The plans fourth feature that concerning the
certificates OF indebtedness One provides that bonds amounting
S26O0OCO be s and that the proceeds be used redeem the CeT
Gates in cash their value The other provides that
amount Of 100000 be given to holders of certificates in exchange for
the latter
either these plans runding certificates OF ndebt-
eness adopted and put through will probably big
debt against company property forever discussion as to
what disposition viii be made of this Obligation which contracted by
evasion of the law seven years ago.
Opinions company now has the right to con-
vert the certificates of Indebtedness into bonds redeem them with
the proceeds of bonds secured by mortgage the oompanys properties
but those who control the cOpany affairs propose do those
very things the They have the power they're going
When they the will wiped existence
and speculation the question the Companys right pay
the capitalization their place will probably
looks if the people District Columbia
Certificates 20 by the board
The proposal that extensions improvements
be financed by future bond sales economically sound this
there doesn't he any chance that says thing
another This remarkable, but Certainly there has been
much renvssten surplus with its subsequent capitalization
gas affairs in the past
The plan refund the per bonds of S59SOOO like
issue per unreasonable enable the COM
pany make lis securities uniform to rate Of interest and time Of
nuu Westinghouse have great complaint coming that
score and viii none.
As the plan by which company intends pay dividends
in the future however the public clearly has the legal right and
opportunity to demand consideration This proposal framed
adTOf The mtnkiHg might at first reading, believe
Surely the company entitled per the
lis property used the business making and distributing gaS
Nobody could consistently dispute that Where then the joker?
The joker is in that fair value proposition. The Monopoly
managers consider 100000 the fair property
OF the company. They claim value of 100000 physical prop
critics and value 100000 their incorporation charter they
demand permission rather they propose to they don't have
the perisonaklg ha Per cent both, s3OOOOOO
The idea which lay in the meTmost of the which
oived this scheme that way must be found for getting nd
surplus earnings without seeming pay high dividend The
capital stock Of the company amounts to 100000 In order
divide p all the earnings among stockholders necessary to pay
dividends of from 10 per cent This looks bad Why say
pay per dividends the value of property Of
10 % cent dividends the value Of stock If could
geth public to thinking pay per there wouldn't
much Camor for cheaper gas The people might forget per
cent a than twice great capital stock
Consideration Of this phase of the reorganization plan brings back
fOcey the fact that has become well established of
The Times long fight for cheaper gas for Washington
What IS the real value of the gas companys properties in
the conduct of It's business"
Nobody but the gas company officials know. They say is
Si3OOOOOO We don't believe ii. Certainly the community will
consent without protest The companys plan pay dividends
ay9Is