New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-05-04
RECEIVER FOR CORDAGE CO.
BondhoIders Take Its Affairs
Into Federal Courts.
ALL PLANTS SHUT DOWN
Has Long Done Business at a
Loss, and Has Made Attempt
to Dissolve Itself.


g. 10000 corporation. commonly known as
the cordage Trust and the successor
three times removed, of the old National
Cordase Company, the failure of which,
just seventeen years ago, brought about the
panic Of 1892 WAS placed in the hands OF
receiver yesterday, after an involuntary
petition in bankruptcy had been nied
against it in the United States District
Court by three creditors. with claims ag-
sregatins 500
Judge Hough appointed Lindsay Russell
d lawyer. of No 165 Broadway, receiver for
the company. with a bond OF 100000. Mr..
Russell said yesterday afternoon that from
the brief examination he had been able TO
make of the firms affairs its assets. in
Guiding the plants in BROOKLYN Boston
and Elizabeth N j. were about S,400.n0.
and the liabilities approximately s5,0oO.en.
From this il would appear that the credit
ors who, with the exception OF Few
merchant creditors with claims agSreSat-
ing less than A,eao, are the holders Of the
company's outstanding s2.S05.S73 first mort
gage . per cent bonds and SZ,4Il.6H . per
cent income bonds. would get less than
% per cent Of the amount of their claims
Action of the Bondholders-
The bondholderS who filed the bankruptcy
petition against the company were Jacob
Fieischhauer, Philip H. E. Neidis and
John Allen. who hold bonds of the par
value of g 90o- Behind them in the move
rnent however it was said on good au-
thority were banking interests represent
ing holders OF large amounts OF both
classes NJ bonds. who are DESTROYS of hav-
ing the affairs Of the company wound up
in -he regular way through q federal re-
cei,,er rather than through voluntary DIS
solution, as proposed by the directors
The latter il will be remembered. on
April II applied 10 the state courts to have
she company placed In voluntary dissolu-
ton and Justice Blanchard in the supreme
Court signed an order to show cause why
the company should not be dissolved In
their petition the directors said that Tor
wears the company had been doing bust
ness at loss, and that the dehcl
amounted 10 seeo 59S on September 50, 1903.
They also declared that none OF the plants
uae in operation and consequently there
Was no net income TO pay the interest on
The MORTGAGE bonds, amounting to Sl4eoo
year.
The proceedings instituted yesterday su-
,.rrAsA this action but according 10 an
officer of the company, application VIII be
made at once TO have the recelTershlp Va
Gated on the ground that the petition tor
voluntary dissolution had already peeh
a00rOYed by Justice BlaNchdio anu ~ '--e
ATTORNEY General Of the state
In the Involuntary bankruptcy petition
elad Yesterday the creditors alleged that
on ADri, I, 1895, the Standard Cordage Com
,7anr executed mortgage to secure an
,s,e of - 10000 Of bonds payable IN
,,,,e,.,,fi,e wears Of which S2.471.6S6 were
1ssued and are now outstanding This is
second mortgage. there being prior lien
Of g $4,000, and according TO the petition
ers the property securing the second lien
5s not worth as much the amount Of the
first mortgage
7. &c also alleged in the petition that
,or the last three years or more the com
many has been managed in q wasteful ana
extravagant manner, so that there nave
reen beav,, losses each year and the COM
nsny il is said. is insolvent- The petition
sets forth further that on April the COM
many committed an act of bankruptcy by
the payment, while insolvent, Of S0'l5o TO
first mortgage bondholders.
This sum- the petitioners say, was for IN
5erest due October !, 1903, on the first mort
gage bonds, and was paid. they declare.
ont of the free assets of the company il
was also alleged that the corporation had
liabilities aggregating more than s2,4oooe0
end that its various plants were not worth
more than s1,ooO,oee.
NoUman d Wollman, OF No. - Broad
Etreet are counsel for the petitioning cred
itors and also for the receiver
According to Mr.. Russell, the quick assets
Of the company include $4,000 cash IN
hanks sl25 90 stock on hand in the VARIOUS
plants and bills receivable of about $1,000.
Negotiations. he said, had also been com
r,leted for the sale OF the Chelsea property
.n Massachusetts for SSo.Ooo. As regards
the plants. he said that while it would
rrobably take between S3.9o3,000 and 100000
20 replace them, they probably could not
be sold in the present depressed condition
of the cordage business for more than
y c0e0g0.
The first mo. tgage bonds are quoted NOM
IleaIly around 20. Interest on them was de-
saulted on April /, 1903, at which time the
management sent circular TO the bond
holders requesting them not to institute
,eceivership proceedings as an attempt was
10 he made TO straighten out the company
affairs without receiyership. The com
many continued To lose money. however.
and one after another its plants were
closed down until none was in operation.
In addition TO its bonds, the company h.
outstanding s2759,7S6 out of its authorized
s. Soce.O capital stock. Charles Wilson
Is president and James G. Hurry secretary
IF the conlnany The other directors are
James 3 Clews. chairman Of the board
y. \ Ramsay, George H. Squire, jr, Albert
r Roardman, George r. Bonner, Albert NJ.
J arlin Norton Squire and b. +. Ham.
The present company was incorporated in
ApriI 1906 as a successor 10 the Standard
Rope and Irvine Company, which failed in
1905 This company was Itself a successor /
of the United States Cordage Company,
which was reorganization OF the National
Cordage Company, and failed in 1895. The
stock OF the National Cordage Company.
which was as widely dealt in then as Steel
common and other leading stocks are now, /
dropped from 81 May l. 1893. 10 Is u
three DAYS later following the appointment
OF q receiver for the company The prices
Of all the active stocks on the list went
down with a crash on the announcement 81
the failure, and three Stock Exchange
houses and several brokerage firms were
forced 10 close their doors