New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-05-10
100000 FOR RUNELY
comuIetiOn of REIMBURSEMENT
Plan Announced.
mo RAPID EXPANSION
D.sferred Dividend Payments
will Await Outcome Of
Years Business.

c.ni.m Solomon & Co, the bankers
&c instrumental in listing the Sc
y - n the N. Rumely Company on
s.o.t Exchange. yesterday announced
.,r,nletlon OF a readjustment plan.
..s i,olu1es the election Of C. 5. Funk.
-, general manager of the Inter
.s..si Harvester Company. as presi-
nd the placing Of 100000 new funds
.ss coupanys immediate disposal TO
an lis business of making agricult-
i-,-lenents The company has also
..,s5 with its principal banks here
sr chicago for the necessary lines Of
ri, covering its seasonal borrowings.
,,.s # is believed. Will adequately pro-
"a for the financial requirements for the
resent season.
:. ives also announced that dividend
ITS ON the preferred stock would
>. .nspended until the outcome of this
us business was known. The board OF
,-..to-s has been reorganized so that a
-.,,oritv OF It's members represents the
,..srssts who are financing the company's
..,r,rsuents. An executive committee
,,s been appointed. consisting of c. 5.
rr,t lanes a. Patten Elisha Walker,
:, villian Solomon & Co, and John ii.
go, the recently elected vice-president
= .borre OF finances. The finance COM
.,,,tse includes Mr. Funk. Elisha Walker
"a Max Horwitz. OF Hallgarten & Co.
Tho 10000 additional working capital
/. 10 be supplied BY Solomon & Co. and
Hallgarten & Co.
The bankers, IN an extended statement.
svnlained that the temporary difficulties
!, which the company recently found IT.
s,y were the direct result OF too rapid
evanston OF its business. with an ex-
,-avarant executive management, which,
# IS charged. did not possess a full ap-
rreciation Of the unusually large amount
q capital required in the agricultural i'm
nleuent trade The charge Is also made
that the bankers have not received re-
gable information as to the company's
actual progress.
Il was stated that as a result Of the
tankers reliance on the company's esti-
nate Of $4,000 as the 1912 earnings. the
roWooo Of notes. issued in February,
we're purchased From the proceeds Of
rtese notes # was believed that the com
rsnv would have sufficient funds TO ham
10 the volume Of business then contem-
plated
During the progress Of the annual audit
Of the company's books. however. the
bankers declared they were led to believe
for the first time that the information
pgardinc the company's true condition
bad not been trustworthy
We accordingly arraEged 10 have elect
& to the position of vice-president IN
charge Of finances John II. Guy, in whose
Integrity and capacity We have implicit
confidence" continued the statement.
He found that the officer Of the COM
pany had planned 10 increase its volume
ir the current year 70 about S-SOoV4
end that contracts for the purchase oil
Materials and other arrangements had
teen made with that volume Of business
n view. 10 was apparent that so great
an expansion Of the company's volume
uould result IN the employment Of mucn
arger amount Of capital than had been
reduction in the proposed output was
essential. on account of purchases ana
sontracts which had already been made
for materials and parts Il was not con-
adered feasible 10 reduce this year VOL
me below s. 10000, but arrangements
for that reduction were at once made.
Upon the publication on April OF the
annual report. which showed that the
sarnings for 1912 had fallen far short OF
he companvs estimates, the company
banks. most NJ whose loans had been
ysii out Of the proceeds OF the sale or
the 100000 of two-year notes became
ts,rustful OF the management and hest
lated 10 extend 20 the company the usual
seasonal credits upon which it relied 70
enable It 10 carry on its business until
The autumn. when most OF its collections
are made.
In order that we might be in a posi-
ton TO deal with this emergency we
caused a further examination OF the ar
fairs o. the company 20 be made with
he aid OF Mr.. Guy and experts in the
agricultural implement business. and
reached the conclusion that while the
Management OF the company had been
inrroydent In It's policy Of rapid eXpan-
toa and while the bookkeeping prior to
The admin,stra ton OF the present con-
roller had been imperfect and while
much Of the information which had been
furnished TO US and 10 our accountants
'sgercing the financial position OF the
company and its requirements was most
Inaccurate and misleading, the enterprise
v" essentially sound one"