The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-07-03
5000 BANKS ASKED e
TO ASSIST CLAFLIN
Committee Wants 100000, 00n
I'm Notes Deposited Pending
Final Adjustment.
MERCANTILE FIRMS AID
Agree to Cooperate in Effort to
ReOrganize Company That
Failed.

A committee representing banking IN.
situations throughout the country took the
first decisive step yesterday Toward help.
ing in the reorganization OF the II "
Claim Company.
The so-caled noteholders' committee OF
which James S. Alexander. president Of
the National Bank of Corsmerce. is chair.
man. sent out letters to the 5000 banks
in the county holding notes Endorsed BY
the Claflin company asking that those
notes, amounting to more than $50, o00.-
900. be deposited with the committee, as
the banks agent preparatory to working
on plans to make arrangements that ths
best possible adjustment of the failed com
pany's AFFAIRS be made.
In fAking this step the bankers have
the promise of practically all the mer.
chandse creditors OF the concern. II was
announced yesterday that the National
Association OF Credit Men, with a mem
bership of more than $4,000 firms In all
sections of the United States. had voted
to join hands with the merchandise cred
itors' committee in helping the Clafin
concern
The noteholders' committee, in it, ei4-
cular letter. asked for the deposit with II
OF the notes, "A form of assignment and
deposit agreFnent between the committee
| ana tne nOtenOlderS.
Asks Deposit Of Notes.
The COMMITTEES requests the Immediate
| deposit Of the notes." states the letter.
because II NJ imperative that the holders
should act together for the protection Of
| their mutual interest"
The letter then gives a summary Of the
| Clahin failure which says:
The situation appears to the commit
Tn m fnllnWg Ths
4 II. u. Claim Company had outstanding
| no direct or primary obligations upon
| notes executed by 1t. and excluding it's
| merchandise Indebtedness. obligations
upon leases and letters OF credit Its sole
| Indebtedness is its contingent liability
upon approximately $40. 0o0. 900 OF notes
which are commonly known as 'Ciafin
recoivabes or Endorsements
| The committee believes that the only
notes NO Endorsed and so discounted by
the II. Is. Clanln Company were notes
executed by some twenty seven corpora
tons, practically all the stock of each o.
which corporations was formerly owned
/ by John Claim individually. Notes
executed by corporations or partnerships
in which there was not this Clafin own
ership were not discounted by the Ciadin
| company and are not now outstanding.
THE committee invites the deposit Of
all notes bearing the II. u. Claim Com
! pany Endorsement. because II is apparent
| that the affairs Of all OF the companies
which executed notes Endorsed by the X.
u. Clahn Company are now involved with
that corporation.
VIII Try 10 Collect Notes.
THE committee wishes to assure de-
positors that proof of the respective notes
Will be filed against the makers and ef-
/ forts will be made to collect ar large a
portion of the notes from the bankers as
is possible thus reducing the contingent
I liability of the indorser. The committee
will proceed against each of the makers
/ on behalf of all noteholdcrs holding OBJ
legations OF that maker and will obtain
information about each OF the corporation
makers and will transmit such informa
ton TO the parties interested.
| The policy of the committee will be
that the assets OF each maker should b.
separately held for the benefit OF that
makers creditors and not confused with
the assets OF other corporations. The
committee wishes to emphasize that mem
bers OF the committee represent institu,,
lions holding notes purchased through
note brokers or discounted by the com
pany with its depositary banks and that
all Of the notes are OF the same general
character
Receivers have already been appointed
for "A large number OF these corporations.
and others will be appointed In a few
viate the appointment OF receivers for
some two or three ofsthcse corporations
and for that reason n list Is not given
OF the stores "ot now in the hands Of
| receivers"
seeks Full Authorization.
The deposit agreement between the
notehoders' committee and tho note
holders provides that the committee In
| authorized to formulate n plan for the
reorganization OF the Clafiin company or
any OF it's allied concerns. II says
Furthermore, that holders Of certificates Of
deposit who shall not have sent any plan
OF reorganization may surrender certifi-
Gates and withdraw their notes from the
committee.
The agreement further provides that
the committee shall have until July next
In which Ia work out "A plan for reorgani-
zaton or liquidation of the Clafiin con
Germ 1t provides also that neither the
committee nor the depositor shall be
liable personally for any act, omission
error of judgment error or mistake Of the
committee or any OF it's members
The alliance of the merchandise cred.
tors committee and the National Associa
ton OF Credit Men was made by J, Harry
Tregee, secretary treasurer OF the Ma
tional Credit men.
Judge Hand In the United States Dis
trict Court signed an order yesterday
morning giving Joseph n. Martindale and
+. A. Juilliard, receivers. until July II IN
which to send out notices of "A meeting %
the creditors OF the II. II. Claim Com
pany and the Defender Manu.acturiuG
Company, a subsidiary.
number OF retail stores have been
holding OF on their buying. expecting that
n gigantic bargain sale would be cor-
Quoted by the receivers Of the Clan'n