New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-08-24
PLIGHT OF THE
B. & M. RAILROAD
Receivership Regarded as
a Refuge from a Multi
plicity of Troubles.

pointment Of a temporary receiver Tor
the Boston e. Maine Railroad, to be
followed as soon as possible by a per-
manent receiver, was asked for in the
bill in equity filed yesterday, it be-
came known to-day, when the papers
were made a matter of record in the
United States District Court here.
Power and authority to operate all the
railroads and property owned and con-
troled by the Boston & Maine, in
Guiding its score of leased lines, would
be vested in the receiver II the
prayer of the petition is granted, with
the especial stipulation that creditors
be restrained from interfering with the
receivers in any way. A court decree
fulfilling these requests would bind
closely to tho Boston & Maine the
control OF lines under lease and mako
impossible any independent action by
their officials. 1t was the objection Of
certain leased line interests which
made impossible tho reorganization Of
the road without receivership, and
suggestions have been made that they
would oppose the appointment Of re-
ceiver.
The Reasons.
AS q reason for the proposed re-
ownership, the petitioner, the Inter
continental Rubber Company, of Jersey
City, N. j., which holds note of the
road for $51 900, due August 81, states
that the company's credit is so poor
| it cannot issue bonds at a reasonable
/ price and that it is unable to raise
/ money on short term notes. Outstand
/ ing notes of the company to an extent
of sl3,306,O6O, according to the bill,
cannot be paid when they fall due
August 81, the date or which payment
will be demanded, also on notes by the
Vermont Valley Railroad Company,
amounting to 100000. Endorsed by
/ the boston q Maine.
1.-THE roads inability to make pay
ments on the notes and to procure ex-
tensions again will result in a multi
! plicity of SUITS" the bill states, "and
a race Of diligence to secure attach
ments on every available bit of prop
erty owned by the company. Ii this
condition were allowed to go on, it
would be to the great loss of the bond
/ holders, whose notes are not due for
many years, and whose only remedy is
receivership."
Futile Prosperity.
The Boston & Maine, now enjoying
/ the most prosperous condition in its
/ history, has available for paying ma
turing obligations total quick assets of
! Sl0,497,647, the petitioner states. OF
this amount, Ss,107,717 is in cash and
s2,SS9,93O in notes. stocks and bonds.
The bill alleges that, although there
was surplus of s4,O65, 69l during the
I Aooh hSNhA yCdAg bic iOdu was
to pay its fixed charges out of earn
ings and was obliged to meet these to
the extent of s2,5oO,OOO out of its
( capital stock.
During the next five years, it was
stated, $l0,OOO,Oo0 will be necessary
/ for improvements and a much larger
sum could be used. In addition, there
! are contractual obligations amounting
to 1891, 900 maturing on or before
January 1, 1917, for improvements
/ already made.
A table is given showing the amounts
the road was obligated to pay during
the last fiscal year as rentals for sew
eral companies taken under leases.
/ The total of these outstanding June
80, 1916, amounted to S110,502, 277, and
interest, dividends, ETC., sccruing to
June 80 amounted to S5,544,242. The
road also paid in most cases, the bill
!. says, interest upon the debt of lessons
and expenses of maintaining their
separate organizations.
Boston, Aug. 23.-In answer to the
| petition for receiver for the Boston
& Maine Railroad which was filed in
the United States District Court yes
terday, the road to-day announced it's
consent to an order appointing a re-
ceiver and averred that the matters
contained in the bill of complaint are
true. That receivership proceedings
would be sharply contested, however,
was indicated in a statement issued
tonight by Conrad w. Croker, junior
counsel for the Boston Minority
Stockholders Association, claiming to
represent 500 out of approximately
$4,000 shares. who said:
I've shall fight any such petition
from the drop of the hat to the last
ditch. There is no excuse for the direc-
tors refusal to make some effort to
secure renewal Of credit. The appli
cation for a rcceivership and re-
Ownership are two quite different
things and the proceedings will give us
splendid opportunity to present our
case"