New-York tribune., 1919-06-03
Escapes Tax ON
Proceeds From
Sale of Assets
|. NJ. Nj. Stockholders Told
by President Franklin
Burden Of Government
Levy Is Shifted to Them

The plan of the International Mer-
camille Marine Company for selling it's
British ships and other assets to an
English syndicate for 927,0O0,o00, and
the proposal for liquidating the COM
pany by giving shareholders the stock
and share lien certificates of the In
ternational Navigation Company (Ltd.)
as representing the British assets,
were recommended by the directors
because, in their opinion, only in that
way could payment of heavy excess
profits tax to this government be
avoided. Under the dissolution ar
rangement proposed by the I. M. M.
board whatever levies are imposed will
fall on the individual stockholders
and not the company.
This was made clear at the annual
meeting yesterday in Hobokcn by
P. A. S. Franklin, president of the
company, who informed the lew share
holders present that directors had
been advised by counsel that the only
way to avoid the "heavy income tax
date the senior shares through the
issuances of share lien certificates of
the International Navigation Company
(LtdD, which concern, in the event the
sale of the British assets is approved,
will be the holder of the 927,O0O,0O0,
representing the purchase price"
Asks Approval
IL.
of stockholders approving the liquida-
tion plan in the event that they in
dorsed the recommendation of the di-
rectors for selling the ships and other
assets. He said the two propositions
were closely linked and that the COM
pany would be placed in an awkward
position il they indorscd one plan
and not the other. In reply to a
question from stocknolder as to
what process would be adopted in case
the liquidation plan was adopted Mr..
Franklin replied:
"lf the shareholders on June Is vote
to dispose of the assets it will then
be in form for the appointment of a
liquidator, in whose hands the entire
matter of liquidating the company will
then be. In the event Of liquidation
stockholders will receive securities of
the International Navigation Company
(Ltd.), and it will then be up to them
to either hold those securities or con-
vert them into cash and stand the
loss of transmitting the funts from
Europe to this country, and also the
American taxes"
Mr. Franklin stated that it would re-
quire majority vote Of the out
standing stock to put through the plan
for selling the British fleet, but that
twothrds vote would be necessary
before the company could be liqui-
dated. In the latter event the out
standing bonds will first be retired
and then the preferred stock at par
with the accumulated dividends of 81
per cent.
John 0. Connor, stockholders, in
terrogated Mr. Franklin concerning
the advisability of selling the British
ships at this time. He expressed the
opinion that the company could af-
ford to go along for two years and
after that sink it's entire fleet and
still have left $1,000 10000 more than
the British syndicate has offered for
the liquid assets and tonnage of the
English companies" Mr.. Franklin's
reply to this statement was:
A "Critical Time"
'If the shareholders feel that wav
about it they can vote against the prop
osition. We have reached a crucial
period in the history of the Interna-
tlonal Mercantile Marine. If the share,
holders wish to lqudate the company
they will never have a better opportu-
nifty to do so than at the present time.
If they wish to continue the operation
of their ships they have a splendid
opportunity to go ahead.
but there has been so much back
ing and filling in regard to the pro-
posed sale OF the companys British
tonnage that the board Of directors
decided to recommend the transaction
and put the matter up to the share,
holders for a decision."
Report for 1918
The annual report of the |. M. NJ
made public at yesterdays meeting
showed profit for 1918, after taxes
and fixed charges, of s12.94O537
compared with s15,475,9S5 in 1917
After deducting s3,3Ol, ,51l for depreci-
alton of steamships last years surplus
was S9,639, ,026, equal to 1858 PEI cen,
on the $51. 500 outstanding preferred
stock contrasted with 22.72 per cen,
earned in the, preceding year. The re.