Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1915-05-05
ANNOUNCE PLAN OF
CENTRAL |. AND S. co.
[Continued from First Page. !

!
are to bear six per cent. interest with
a sinking fund of $4,000 year or a
less amount to be Droportioned up
on the basis of the number of bonds
issued. These bonds or the proceeds
| thereof are to be applied in the abso-
lutte discretion of the reorganization
| committee to the payment of arrears
of taxes, expenses of the receivership
and the reorganization of foreclosure,
including all expenses, counsel fees
compensation and so on of the Bond
holders and Creditors Committees.
The report on the proposed plan sets
out that an amount not exceeding
800, 900 is to be placed in the treasury
OF the new company for working capi-
tai and the balance of the bonds or
their proceeds is to be used only for
Improvements or new property upon
the terms fixed in the new mortage.
The Series B bonds are to be issued
at par for the outstanding present first
mortgage bonds, which aggregate
$1,239,0O0. They are to bear per
cent. interest. No interest thereon is
to be paid for the first two years;
per cent. thereon for the next three
Years, and per cent. thereafter. The
deferred interest is to be cumulative,
and after five years from the date of
issue any portion of interest deferred
! for the first five years may be paid by
authorized board of directors out of
surplus net earnings, provided full rate
of interest on all debentures has been
paid.
Series bonds are to have a sinking
fund of $4,000 a year beginning five
years from the date of issue.
All first mortgage bonds are to be
! subject TO redemption or purchase by
| the company on any interest date
| Series A at not exceeding one hundred
and five per cent. and accrued interest;
Series at not exceeding par and
accrued interest.
The debenture bonds are to be
issued as follows:
OF Series A, s6OO,O 900 will go to COM
mercial creditors, so per cent. of their
claims. or $55S,000.
OF Series B, 100000 will go to 9th
er unsecured creditors, so per cent.
| of their claims, or $780, 900; or a total
I of $1,15S,000 of the $1,000, 900 issue.
No interest is to be paid on any of
the debentures for five years. After
| hNe years per cent. per annum of
| Series A, and all interest paid thereaf-
! ter to be equally divided between
| Series A and Series b until Series A
shall receive per cent. per annum,
| after which payments are to be made
to Series b until both classes of deben-
lures shall receive 3 per cent. per an-
mum. The maximum upon each series
| of debentures, Series A and b, to he
5 per cent. Series A to have priority
of payment of principal over Series
b IN case of liquidation. All deben-
! lures are subject to call at any in
| terest period.
The capital stock of S2,245,0OO is to
be appoItioned as follows: To COM
| mercial creditors 20 per cent. of their
| claims, $139, 500; to other unsecured
| creditors 20 per cent of their claims,
| S150,000; total. $2S9,5O0; to stock
holders 50 per cent. of their stock, ST.
| 1872. 800; total, $1,412,000.
The balance of each class of securi-
| ties-bonds, debentures and stock
! remaining after the distribution will
| be held and may he used by the Re-
! organization Committee in it's discre-
| ton for the purpose of this plan of
/ reorganlzation or. any modification
thereof or for the purposes of the new
i company. After discussing the dis
tribution of securities the report goes
on:
Under the foregoing arrangement
present bondholders will receive first
mortgage Series bonds at par for
, their bonds. Commercial creditors will
receive so per cent. of their claims
in debenture bonds, Series A, and 20
per cent. in stock. other creditors, 80
per cent. of their claims in debenture
bonds, Series b, and 20 per cent. in
stock.
The provisions in the plan whereby
|
Series B first mortgage bonds are
limited and payments to the sinking
| fund postponed for five years will re-
lieVe the company from the payment
of large amount of overhead charges
until it will be better able to meet
them.
'"rhe Central Iron and Steel Com
pany is responsible as the guarantor
for the payment of the principal and
interest of $545,O00 bonds of the Con-
nellsville Basin Coke Company, all of
which are issued and outstanding. This
guaranty was given as a part of the
arrangement for the purchase of the
stock of the Connellsville Basin Coke
Company now held by the Central
Iron and Steel Company. The Con-
nellsville Basin Coke Company has not
been successful and the Central COM
pany from time to time has made ad-
VanceS to the ConnellSVille company.
The present bondholders of the Con-
nellsville company are now in a posi-
tion to foreclose the mortgage. Upon
a sale under foreclosure the Connells-
Vile property would not in the judg-
ment of your committee. realize an
amount sufficient to pay the bondhoId- =
ers in full, and they would be entitled
to make claim as unsecured creditors
against the Central Iron and Steel
Company under its guaranty. The plan
contemplates that the Connellsville
| Basin Coke Company Will receive the
| surrender of it's shares of stock now
held by the Central Iron and Steel
Company and the cancellation of Cen
trails claims for money advanced to
the coke company, in consideration for
which the guaranty by the Central
Iron and Steel Company of the princi-
pal and interest OF the Connellsville
Basin Coke Company bonds will be
cancelled.
"All of the capital stock will be sub
| ject to a voting trust agreement to be
! established by the Reorganization
! Committee and to continue until all
of the debentures and all of the bonds
are paid. The voting trustees there
under shall elect a board of directors
consisting of nine persons, three of
whom shall be representatives of the
bopdholders, three representatives of
the creditors and three representa-
tives of the stockholders. When all
the debentures shall have been paid,
| the creditors shall no longer be en-
titled to representation upon the board
of directors, and their places shall be
taken by representatives of the bond
holders.
"A new mortgage securing the
bonds, which it is proposed to au-
thorize, is to be prepared by John
Hampton Barnes, Esq, and in addition
to the customary provisions, it shall
provide that there shall be deposited
each month with the Girard Trust
| Company, trustees Hereunder, a pro-