Norwich bulletin., 1913-07-29
U. s. FINISHING COMPANY REPORT
Deficit has been Turned Into $s50O0 Profit in Last Three Months-Plan of Reorganization offered by New Issue of Preferred Stock-1O Per Cent. Debt, with Interest, in September Proposed by Stockholders

I
 A plan for the reorganization of the United States Finishing company that ] may be consunmated before Aug. 15, I but probably not until fall or winter, by new issue of preferred stock to meet bank obligations accompanied on 1 Monday the encouraging statement Of I the creditors committee that the com pany has once more been placed upon
 a sound basis. In the last three
 months, under the new management,
 a deficit has been turned into profit
 aggregating SS5,000 and the future of the company looks bright to it's cred i itors.
 It is proposed to pay on Sept. IS, i 1913, to the creditors of the corpora l ton a dividend of 10 per cent upon l the principal of it's indebtedness, to- 1 gether with interest to that date, and l to issue per cent notes, payable in | one year, to cover the remainder or
 the indebtedness.
 | Because of prevailing financial con- ditions it is hardly probable that re- organization can be effected before
 next fall or winter. The committee, year an expression of the views of the bank creditors, to the end that final I action may reflect the views of a ma 1 jority of the banks interested. The committee believes that the loss incl- dental to receivership can be averted
 and the payment of bank obligations l hastened by the course of action map ped out, and that the liquidation of the 1 entire debt can be accomplished with 1 in a reasonable time.
 The report of the creditors commit l tee. the communication from the stock i holders committee and the statement ! from the chartered accountants ern- 1 ployed. all contained in the circular
 mailed to the creditors. follow Report of Creditors Committee.
 New York City, July 24, 1913.
 To the Creditors of the United States Finishing Company:
 Your committee appointed by the
 creditors agreement of March 20, 1913. l is now able to supplement the report
 of May as follows:
 | The effort to formulate a plan of
 reorganization resulted in the appoint ment of stockholders committee, the
 personnel of which is particularly strong. Opportunity has thus been af- 1 forded for more complete cooperation
 and more direct negotiation with the stockholders.
 | The stockholders committee has recently communicated with your own
 committee requesting. for reasons stated in its communication, that an extension of time be granted to put 1 into execution a proper plan of reor- l ganization. A copy of the letter is hereto annexed.
 Your committee has maintained close supervision over the affairs of the corporation and is gratified to ob- serve the substantial progress made under the management of MT. Thomp- son. The accounts of the company have been kept by Messrs. Barrow. Wade, Guthrie & Co.. chartered accountants,
 employed by your committee. A copy of their report is hereto annexed, from which it will be seen that a deficit during the last three months of the old management has been turned into a profit of, say, J$S5 900 during the past
 three months under the new manage ment.
 This showing indicates a substan- tially greater annual earning capacity in view of the fact that the maximum business of the company falls in the months from November to April and
 in view of the further fact that this
 profit has been realized in the face of inevitable confusion arising from the existing embarrassment of the com
 pany coupled with complete change of administration.
 In view of the prevailing financial conditions, it would seem improbable that any plan of reorganization can, be consummated prior to the fall and win
 ter months. Your committee is, there fore. disposed to accept the offer of the stockholders committee.
 Your committee will await an ex-
 pression of your views until Aug. Is,
 1919, in order that the action of the
 committee may reflect the views of a
 substantial majority of the banks.
 In the opinion of your committee,
 the loss incidental to receivership can
 thus be averted; the earning capacity
 of the company can be further demon strated; introduction of new capital can be rendered attractive. and the
 payment of these bank obligations can thus be hastened. Should any unto
 ward incident arise. your committee
 will be in position to immediately ma
 ture all of the notes and protect your interests. You will appreciate that
 bonds of nearly $3,00O,OOo constitute first lien on the properties of the company, and this circumstance would
 render liquidation peculiarly difficult for the bank creditors.
 Upon the issue of the new notes the
 old notes will be held by the commit tee as collateral security, thus pre-
 serving the indorsement of MT. Jerome. Very respectfully, c. L. BAUSCHER,
 GEORGE s. MUMFORD, HERBERT J. WELLS, Creditors Committee.
 LATSON, TANIBLYN & PACKARD, Counsel to Committee.
 55 John street, New York city.
 Stockholders Committee.
 New York City. July "A, 1913. c. L. Bausher, Esq. Chairman Cred itors' Committee, the United States, Finishing Company, IT Battery Place. New York City: Dear Sir: As your committee Is
 aware, the undersigned have been con- stituted a committee of stockholders and have undertaken in cooperation with your committee to formulate and consummate 8 plan for the readjust- ment of the company's affairs. At the outset of our deliberations it i became apparent that no plan of re- organization could be formulated until had been demonstrated through the ad- ministration of Henry B. Thompson, acting in cooperation with your com
 mittee.
 The report of the chartered account
 ants shows the rate of earnings for three months under the new manage ment to be sufficient to cover all ex- penses and interest charges, leaving a substantial surplus applicable to the reduction of the debt This would in dicate that the company has already Fbeen placed upon a sound basis | A plan for the reorganization of the company has been formulated, con templating new issue of preferred stock, the proceeds of which are to be utilized in payment of the bank obli- gations. This committee now holds proxies for more than 75 per cent. of each class of stock outstanding, thus having power to consummate the plan The intervening time before Sept. 13
 however, is not sufficient to fully dem