The sun. [volume] (New York [N.Y.]) 1916-1920, 1918-12-03
warns Against Litigation.

The members Of the committee will cons
suit their clients and meet Thursday.
Warns Against Litigation.
Judge Mayer laid stress on the fact
that his suggestions were to be regarded
merely as n basis on which contendlng
interests might get together. He said
that the skill Of the receivers and their
counsel, together with the demand for
the company's products created by war.
had served to straighten out its highly
Involved affairs and that now all that
is necessary is a spirit of accommo-
dation in the adjustment of securities.
He gave warning that if opposing sides
press their strict legal rights litigation
will result that will seriously hamper
the company's transition to a basis OF
peace production.
Judge MAYER declared that II Is now
the task to find a medium route between
holders OF bonds and preferred stock on
the one hand and holders of common
stock on the other. He said he thought
there would be but little difficulty in sat-
isfying bondholders that the preferred
stock was the serious problem. Judge
Mayors suggestions for the treatment Of
bonds and preferred stocks follow:
As to the bonds: To give to the bond
holders the alternative of payment In
cash at 90 or to let them retain their
bonds at 100. In which case the principal
would be paid In twelve annual install.
ments Of S II per cent.
As to preferred stock: Deferred divi-
bends aggregatlng II per cent. should be
paid and then the preferred stock con-
verted at 81 into first mortgage bonds
with interest a 9 per cent and carrying
per cent sinking fund retirement
provision.
Preferred stock q Problem.
the preferred stock gradually, Judge
Mayer said: 1T Ii not pcssible to fore
see with accuracy whether the liquid
assets OF the Aetna Company can prop
erly be depleted to the extent of paying
out at this time. even at a reduced fig
ure, sufficient cash to retire the pre-
| ferred stock At present the status Of
the preferred stock has DISADVANTAGES
both to the owners thereof and to. the
owners OF the common stock The pre-
| ferred stock holders have no lien Of any
KIND. On the other hand, q dividend of
per cent. per annum will be too large
In the future in view of the change (the
| cessation Of nost,lities) which has taken
place In the affairs of the oompany."
Sol Wexler. a banker who spoke az
representing 10000 shares Of common
stock. was the only one to accept Judge
Mayors request for an expression of
| opinion. He said that 90 was too high
an allowance for the outstanding bond
issue II the holders accept the court 3
PROPOSAL for immediate payment in
| cash He said that So would be enough
and gave figures relating to the exist
| ing market for securities.
| mat ~ the Wall Street point OF
| view" said Judge Mayer. He added
mat he was concerned only in bringing
about an equitable settlement and that
present market prices did not enter into
the matter.
| Mr.. Wexler said he was talking from
an investors standpoint He agreed
| with Judge Mayer that the bond prob
lem was OF relative unimportance and
turned TO the proposed conversion OF
preferred stock. He said that an allow
ance OF 81 would be too high. that rs
would leave the common stakeholder
| some chance"
/ Judge Mayer said that his figures were
| Intended merely as suggestions and that
the actual figures were for the commit
tee to determine