New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-09-25
BIG CORPORATION
new CLAFLN PLAN
Five Trustees to Supervise
Business Until All Debts
Are Satisfied.
MERCANTILE STORES
TO BE ORGANIZED
Basis Of Creditors Agreement
Calls for Is Cents Cash and
3.Year Notes at 5 Per Cent.

Plans for the reorganization Of tie
u. 2. Clshin Co., with the exception
Of few details, are complete, ana
viii be submitted to a general meeting
Of creditors, to be called within re"
days. Later they will be submitted 70
the court for its approval
These plans call for the payment Oh
IS cents IN cash to the creditors about
February /, the remaining So per cent
to be in thee-year collateral trust
notes. with interest at per cent.
There are twenty-three retail stores
twenty Of which show liabilities OF
s2sss9 ,7s7. although only S2,2lS,So0
are direct liabilities on the stores. Inc
difference Of $26,121,411 represents
notes Endorsed By the H. B. Claim
Co. the proceeds of which we're usso
FOR the benefit Of the Claim company
The assets Of these stores amount 10
si8,27s, 46t. os;.
The liabilities of the H. B. Clanin
ca are $4,000 900, appOrtiOned as fol-
,ovs. Noteholders, sS1,5oO,ooO; mer-
,bsndise. etc, 100000; other IN
debtedness, S1,7oo,OOO.
To secure the payment of the % per
cent given in notes, the creditors p I.iIo
nose first to organize the Me i,S n,-aV.
stores Company, which VIII tsAS Iii Iii
the twenty three retail stores. &c
have a board of directors OF seven, ~
which three will be merchants;
II. B. Clahin Corporation is 70 DC I'd
ranized TO take over the WhoiEsaIe go. 60
3obbing business. II also VIII haHe
board of directors OF seVeh' u
four will be merchants. ..;o,
The Mercantile Stores CoTPoItalsa9! Jon
nil hold the stock of the Il. b. Cisulh
Cornnration. In turn there Will De
fvc trustees. to be composed OF VhIee
bsokers and two merchants, VINO II
t,.n will supervise both businesses III
t5o interest of the creditors. The notes
"a no given to the creditors Will De
tLrea-vear collateral trust certlncates
If tbe Mercantile Stores CorporSuou'
These notes will be divided into
,,ro1,tv-four series. The first OF the
series will be the merchandise creo III
ors' claim of approximately S',6oV'OVV
.deductinr the 10 per cent cash }, Sc
c,,~itv for which will be oRe-sixth OF
inc &c OOO 600 capital stock Of the H.
Claim Corporation. Each OF the le-
,,sining twenty-three series will be Sc
r,,re1 bv the capital stock OF the re-
tail company, which executed the orig
NAL Clafin notes, 70 be exchanged 1oF
the new notes.
Finds for the payment Of interest IN
tho notes of the merchandise creditors
will be derived from the DIVIDENDS
rIDou one-siXth of the stock OF the pro-
posed II. B. Clafin Corporation; from
he distribution of the earnings upon
The unpledged investments and prop
orty of the Mercantile Corporation,
.ncb as fvc-sixths of the capital stock
of the n. B. Clafin Corporation, the
ranital stocks of the United Dry Goods
Companies, Scruggs, Nandervoort-bar-
nov Drv Goods Company, Higbee Com
many. McCreery & Co., Of Pittsburgh,
various equities in real estate ana
other assets. and from dividends upon
the capital stocks of the twenty-three
retail companies deposited under the
trust agreement to secure the other
series of notes, after payment IN tull
Of the series of notes for which the
stock is specifically pledged.
Funds for the payment of the inter
est upon each Of such series Of col
lateral notes to be held by the note
bolders will be derived from the dlyl"
dends upon the stock specifically
pledged to secure each series; from
distribution of earnings upon un-
pledged investments and property OF
the Mercantile Corporation; from diyl-
5snds upon the capital stocks of the
Companies deposited under the trust
Agreement TO secure the other series OF
collateral notes, after payment IN tull
Of tie notes for which said stock ID
specifically pledged.
The indebtedness Of the twenty
three Claim retail stores other than
TO the Claim Company will be settled
on the most advantageous terms pos
sible. Thus, each of the companies
nov IN the hands of receivers VIII De
enabled TO begin business practically
without indebtedness. There IS also q
provision for the extension OF the
trnst notes for two years additional.
All Of the Indebtedness between the
twenty-three stores now in the hands
Of receivers and the H. B. Ciafiin Com
panv IS to be cancelled, where the in
oebtedness of the Clafiin Company eX-
ceeds the notes against the store.
The exceptions to this are the
George W. McAlpin Company, Of Gin
cinnsti which IL indebted TO the Olaf
lin Company for S917 1872, while the
notea amount TO $490,9l0. The trus-
.ees will receive and hold for the Mer-
camille Corporation notes secured by
the McAlp.E Company stock OF $685.
OOC, which IS approximately SO per
cent of the difference The same con-
0ition cNlSts in the store of the Jones
Company, Of Kansas City, Mo, where
the difference is $4,000.
TIE aya trustees will own the stock
81 the Mercantile Stores Corporation
until oil the notes nave been paid.
ihc~e IS also provision that when all
Indebtedness is paid the stock Of the
Mercantile Corporation shall be turned
over TO the treasurer of the II. b.
CiaA,n Company for the benefit OF the
stockholders Of that company. All
creditors agreeing 20 the plan must de-
uosit their claims not later than Octo-
.,cr Is. with the Bankers Trust Com
,aoy Of New York or designated out
sf-tOwn trust companies.
The creditors committee will select
ne i've trustees, two of which shall
I've direct creditors Four Of the seven
r. rs,tors OF zoe Mercantile Corpora
ION will be chosen by 3 majority of
INC trustees. the remaining three by
q unanimous vote The name of Ed
ward d. Page, former president of the
Merchants Protective Association, has
Been sIrscstcd as one Of the trustees,
while IL Il reasonably certain that Ed
ain Baker, chairman OF the general
creditors committee, will be another.