Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1915-05-05
wise. with such notifications in the

WISE with such notifications in the
plan as may be found necessary.
The Reorganization Committee,
either directly or through the Credi-
tors Committee, shall have authority
to make arrangements in regard to
any. claim which is not in excess of
$500 which, in the absolute discretion
of the Reorganization Committee, may
be in furtherance of the plan herein
proposed or for the best interests of
the reorganiZed company; and any dis
bursements or expenses made or IN
CURED by the Reorganization Commit
tee in connection Herewith shall be
assured and borne by the new COM
pany.
Your committee is glad to be able
to report that the foregoing plan has
| received the approval of the Bond
holders Committee. 1t believes this
is the only plan which can be agreed
upon by all parties.
The proposed reorganization con-
templates the taking of the company
from the hands of the receivers and
| the providing of money for the bet
| terment of its property by the pur-
chase of certain equipment necessary
| for the proper prosecution of its busi-
ness.
THE reorganization as outlined
places the claims of commercial credi-
| tors next after the present bondholders
and in a class superior to the other
unsecured creditors, although upon
a distribution of the assets of the
company applicable to the payment of
unsecured creditors, the claims of the
latter amounting to over $700,000(
would be entitled to share equally with
! the commercial creditors.
Your committee submits with con-
siderable reluctance any plan of re-
organization which does not provide
for the immediate cash payment to the
merchandise creditors of a portion at
least of their claims. 1t does so, how
| ever with a complete realization of
| the fact that payment of the merchan-
disc creditors claims in any manner
other than by the issue of securities
to them is out of the question. 1t has
realized, moreover. from time to time
of the appointment of the receivers,
that only by means of a reorganiza-
ton such as is now contemplated
would the merchandise creditors be
afforded an opportunity to obtain
more than a very small proportion of
their claims-this for two reasons:
First, it is and has been apparent that
upon a sale of the property covered
| by the mortgage after foreclosure
there would be a very large deficiency
| Judgment which would greatly aug
ment the amount of unsecured claims;
and second, the assets applicable pri-
marily to the payment of unsecured
| claims are largely of such a character
that upon a forced sale only small
proportion of their inventory value
would be realized.
"If this plan is not adopted, there
will be a foreclosure of the existing
mortgage and under present condi-
tions it is probable that in such a con-
tingency the bondholders would take
over the property covered by the
mortgage. Unless they should con-
| tinue the operation of the property
which is unlikely, the assets applica BILE
] to the payment of unsecured creditors
would have to be sold on the open
market. The proceeds of such a sale
after the deduction of all necessary
committee believes, to enable the dis
tribution of anything but negligible
dividend to the unsecured creditors.
"Your committee feels that your
| best interest will be served by operat-
ing the plant and making improve
ments from time to time from money
as secured by the sale of new bonds,
and as the additional funds of the
! company will permit.
by article IL of the agreement, un-
der which a large majority in amount
of the merchandise creditors have de-
posted an assignment of their claims,
| it is provided that q notice stating sub
\
reorganization shall be mailed by the
depositary to the depositors, that any
holder of a certificate of deposit may
within twenty days from the mailing
of such notice file with the depositary
notice in writing that he dissents from
the proposed plan, and that If he
does not take this action and with
draw from the agreement in the man
ncr provided therein, he shall be con-
clusively deemed to have assented to
the plan.
This present communication which
IL mailed to you by the depositary
will therefore be considered the no
tice demanded by that article of the
agreement and to relieve you of the
trouble of formally asserting to and
accepting the proposed plan If you
approve 1t, the committee will con-
slider that you have assented to its
terms unless by May 25, 1915, you
shall fle with the depositary the dis
sent required and withdraw from the
agreement in the manner provided
therein"