The sun., 1916-12-08
NJ. Cameron Forbes, Receiver,
and international Bankers
Agree on Plan.
'HRENCH WILL MANAGE 1T
capitalization Of @150,000,.
900 Unchanged-Bond-
holders Secured.

nor-Genera OF tho fniHppihoUs James
speyer Of speyer 4 Co. Sir Edgar
epeyer Of speyer Bros. and Sir william
Hassard Of London. Lord Ritchis Of
Dundee, representatives Of the Banoue
Il Paris ct des Pays Bas. and Of the
eoclete Generate of Paris, Brussels,
Geneva and Lucerne and the Paris
Ro,hschilds have agreed on q plan Of
reorga ganization for the Brazil Railway
Company. which went into the hands
Of Mr.. Forbes as receiver in October.
1914 because OF default by the Gov
eminent OF Brasil.
The reorganization plan has been per-
eected with the collaboration Of Perci-
val Farquhar, "the Hartman OF South
America" who has consolidated. con-
e,ructed and financed railroads there
with q capitalization OF approximately
5000, ,0O0. 900, and all of whose companies
we're prosperous before the war.
The plan provides for the payment Of
10 900, 900 francs by French bankers.
In this respect II is unique. It is the
nrst foreign financial transaction per-
mitted to citizens OF any Of tho ALLIES
since the war began.
Special sanction from the French Gov
@nment was secured by the Banque de
Paris ct des Pays Bas and by the Societe
0enerale In support OF q business propo-
sition In which the French had invested
more than 100000. 900. and which OBJ
viously looked too good to lose.
capitalization IL elBO,OOO, 900.
The reorganization Is also unique In
ma In tf h, n oh
IN the amount of the securities of the
dominant company or any Of Its sub
salaries. The reorganization commit
tees, though representing security hold
ers OF several countries, agreed that the
capitalization OF approximately $780,
100000 fixed by Mr.. Farquhar and his
associate. DR.. F. 8. Pearson. who died
on the Lusitania, was conservative.
Bondholders will keep their bonds. but
the majority Of them have agreed that
the bonds Of most classes are to be
gage bonds. until the Brazilian Govern
ment makes good its guarantees and the
eompany's earnings build UP its finances
above the chance Of collapse.
French bankers and hnanciers viii as
sumo management Of the company. the
French interests being much greater
than English interest and far superior
70 the American capital that has been
invested. The principal obligation Of the
company. payable In France, 10 csc. o.0oo.-
900 francs Of Sac Paulo and Rio Grande
bonds. which were guaranteed a. to In
tsrest by the Brasilian Government.
OF the Brasil Railway proper there was
another issue Of 86.5o0.000 francs put
out In December. 1910. In lieu OF the in
terest on guaranteed bonds Brasil has
given treasury bills to the company. but
these treasury bills cannot be dis
tributed among bondholders. most OF
whom have been driven from homes in
Belgium and northern France or are In
the war.
War Delayed 1eorganisatien.
The committee Of French security
eide Ebray. Le Comte Do Laigue and
Alexis Massenet They will name q
majority Of the new board.
Delay in reorganization Of the com.
pany has been due to war circumstances
Just as was its default. Hundreds Of
holders Of the company's securities were
IN Belgium and In the occupied portion
Of France and the reorganisers have
taken great pains to communicate with
them. Naturally too there have beer
differences Of opinion between the Brit.
kh. American and French interests Al
Of these differences now have been ad'
5usted.
The company was organised In 1906
with an authorized capital OF 10000, ,00f
per cent non-cumulative preferred
stock. 35.000.000 6 per cent. cumulative
preferred and s40,0o0.o 900 common. o.
this stock S5cOO0.000 has been issued
Its funded debt amounts approximate,
10 100000, 900. 1t consists OF f12.s31.
900 +ia per cent first mortgage bonds
sl5i0.b00 8 per cent. debentures. francs
Ss50o.000 ~ per cent. bonds f2.000.0O'
per cent. convertible debentures. ant
francs b.7s7.S00 8 per cent notes.
When completed the company's sys
tenn. which now extends to the frontier
Of Uruguay and Argentina, will ruI
from Sac Pauio to Paraguay ant
Uruguay as we'll. Approximately 5000
miles are now In operation. Mr.. Far
auhar and DR.. Pearson contemplated
linking the company and its subsidiaries
with lines extending to Buenos Ayre
through the Argentine Railway Com
pany which they also organized ant
controlled.
Controls Six other Railroads.
Tho Brazil Railway Company control
the Soro-cabana Railway, ss2 miles; tn
sao Paulo Rio Grande Railway, II
miles: the Parana Railway. 252 miles
the Thereze Christina Railway. 4
miles; Gle Auxiliare de Chemins de Fe
su Bresil. 1881 miles. and the Mort
Parana Railway. &c miles. Jointly witt
the Port OF Para Company the Bras