The sun., 1919-10-08
Morgan Heads Movement to
Safeguard Integrity of
-MS199, 100000 Securities.
HYLAN SLAPS AT JUDGES
Warning Is Given That Some
: Brooklyn Lines May Soon
'- Suspend Operation.

900 first and refunding mortgage 5
per. cent bonds and the $50, 100000
three year secured convertible per
cent notes OF the Interborough Rapid
Transit Company.
Should events require II this COM
tnirtee viii act as protective body,
but for the present no deposit OF
pords or notes Is required. The chair
man of the committee is ]. p. Morgan,
who is now in Europe. Other mem
bers of the committee are Frederic w.
Allen of Lee Hlgginson & Co.. George
u. Baker, Jr.. vice-president First Ma
tional Bank; Allen B. Forbes of Har-
riss Forbes & Co.: G. Herman Kinni-
cutt Of Kissel, Kinnicutt & Co.: H. c.
MoEldowney. president Union Trust
Company, Pittsburg; John J. Mitcehll.
president Illinois Trust and Savings
Bank. Chicago; Dwight W. Morrow OF
j p. Morgan 4 Co., F. II. Shipman,
vice-president New York Life Insur-
ance Company. and James A. Stillman,
president National City Bank.
The situation confronting the INTERIOR
ough bondholders and noteholders was
described in THE SUN yesterday. The
directors OF the Interborough Rapid
Transit Company held a meeting yester-
day, but took no definite action either
regarding the financial situation or the
election of a successor to the late Theo-
dors p. Shonts as president Of the COM
panS. For the present Frank Hedley.
general manager. Is acting president,
and-it Is possible that no president will
be elected In the immediate future. the
directors preferring to see how the fare
and financial situation works out with
default of the interest due January l,
an svent expected In authoritative quar-
terSr provided no increase in fare is
granted.
!. Morgan Issues Statement.
Ths statement issued yesterday by J..
p. Morgan & Co. indicated. it was said.
that the committee viii do its best to
see~that a default Is avoided. and ad-
mitted that concerted action Is now nec-
essary to protect tho investors in bonds
and d-notes. The fact that no request is
made for deposit of bonds or notes was
4 taken as an indication that the COM
Ynitee expects the company to stave of
J ' receivership until the maturity of the
4 interest on the bonds and notes, the
date being January l. The statement
/, issued by0J. P. Morgan & Co. was in
pafr as follows:
4 .The Interbt rough Rapid Transit
Company, Notwithstanding great increase
in ITS operating costs and the mainte-
natce of the cent fare, has been aolt
thus far to pay its fixed charges upon
the first and refunding mortgage per
cent bonds and three year secured con-
vertible per cent. notes.
issuing hankerS deeply
interested in the continuance OF sucr
payments and the avoidance OF defaults
For some time past We have informally
Conferred with others similarly inter
ested as to the propriety or necessity
of taking steps in the interest of tht
hofders of such bonds and notes. We
fare caused careful analyses of pas
and prospective earnings of the subway
system to be made, but it has not here
tofnre appeared that concerted actor
was necessary to protect such inNes,
ments.
ave have always believed, and w
stin believe. in the inherent soundnesl
OF Investments in the bonds and notes
4 In view. however. of the general trac
ton situation in New York and In re
sponse to requests from the holders o
large amounts of the bonds and note
worhave agreed to head a committee. &
acfswhen necessary or advisable. to fur
ther the interests Of the holders OF sucl
securities.
ssThe committee does not deem IL nee
essary at the present time to ask 70
thesdeposit Of the bonds and notes.
No Action Yet on Craig's Letter.
There was no development yesterda,
\ IN the situation which resulted on Mon
day in Federal Judge Julius NJ Maye
directing United States Attorney Fran
I t4a ,, xnytth off
ciai information concerning the lette
sent to Public Service Commission Levi
NIXON by Comptroller Charles L. Grail
in which the Comptroller criticised tn
offcial acts. of Judge Mayer in respec
20 the receivershlps OF the Brookly
Rapid Transit Company and the Ne'
York Railways Company. No statemen
was Forthcoming from the Comptroller
4 and when his Office closed for the da
II was said he had not yet been cited {
appear before the court to explain hi
settlements
Mayor Hylan. however, took occasio
to sput on paper his opinion Of an
Judge who might see fit to interpose an
legal obstacle TO the operation OF IN
Mayors pet bus lines, This opinion wa
expressed in a letter from the Mayc
10 "A d. r. Brown, secretary Of
Brooklyn civic organization, but III
81 Mayor was meticulously careful not I
reter TO any Judge IN particular. II
adjective was "p'iable" The letter said
rYour QUESTIONABLE OF October 2
RECEIVED. Let me reiterate that II III
North Shore Traction Company trolle
lines shut down a system OF buses wi
be .placed in operation. AT this tim
cannot tell you the color the bust
win be painted or the color OF the ha
OF sthe chauffeurs. nor can I tell yo
the style or kind of motor that wi
prApel the buses-but buses will
PLACED in operation unless Nixon. an
the. traction interests can find some pl
able Judge who will give them an In
4 junction. Very truly yours,
John +. HYLAN Mayor"
There were no indication yesterda
OF any well founded hope that the cit
and traction officials would get togethS
on nsthe basis OF the plan outlined at
conference between the traction me
and Public Service Commissioner Nixo
on Monday. Representatives Of the IL
terborcugh Rapid Transit Company an
the subway and elevated lines in Brool
lyn are to meet again on Friday in
preliminary discussion OF the Nixon ide
-but no one interested Yesterday yvoul
preaict that any progress would resu
from the meeting.
Mayor Expects Concessions.
n the failure OF the city TO take an
patf IN the negotiations the traction me
have about come TO the conclusion tn,