The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1921-08-04
BRITAIN WILL CONTINUE IT'S HUGE BATTLESHIPS PROGRAM
CAPITAL CO. Terms
PREVENT MERGER,
ASSERTS NEWMAN
CONTINUED from First Pase)

tOSsutbS '"
CONTINUED from First Pase)
mean that the people who held It
would not get any dividends until the
holders of the FIRST preferred stock
tthe Capital fractions s12.ooo.oo got
their per cent.
The fact that the holders of the
second preferred could not participate
In any surplus left over after ALL
dividends had been paid. would mean
that If anything was left over 1t
would be divided up proportionately
among the holders Of FIRST prefer
| red-the people who now own the
Capital fractions $12.000.000.
| 8. That the common stock Of the
washington Railway and Electric,
amount ting to $1,000 900 at par value.
be turned In at so cents on the dollar,
and that there be issued for It com
mon stock In the consolidated com.
pany.
| Common Stock Unguaranteed.
| This would mean that the holders of
the $4,000, 900 Of common stock Of the
| w. r. and r.. would get $3,9OO.000 Of
common stock in the new company,
with no guarantee of any kind as to
dividends, but with a maximum limita.
ton Of per cent, because II was stipu-
lated by the Capital Traction that all
profits above per cent on the FIRST
preferred. and 7 per cent on the
SECOND preferred, and per cent on
the common, be divided proportion
ately among holders Of FIRST pre-.
ferred.
4. That the first preferred and
4 I'M
power. That the common stock
should not have voting power.
s. That the board Of directors
of the consolidated company be made
up as follows:
Capital Traction stockholders to
elect five.
washington Railway and Electric
stockholders to elect three.
Public Utilities Commission to elect
| one.
8. That the above board serve
for three years.
Presumably. although not stated,
after the three-year period the board
would be elected by the voting
stockholders OF the new company.
As no voting power would go with
the common stock, the stockholders
Lin the consolidated company who
HAD BEEN Capital Traction people,
would be stronger than the stock
holders who HAD BEEN Washing
ton Railway and Electric people by
the exact ratio between the FIRST
preferred and SECOND preferred
stock, which would be as~Sl2. 0o0, 900
is to S6,07l .422.
Control For c. T. Co.
This would mean complete control
and direction of the new company
by the former Capital Traction
group.
In the same document In which
the Capital Traction makes the above
offer. II also makes a modified offer.
or rather an altered offer, AZ follows:
/. That the Capital Traction pre-
ferred stock be put in at par. draw
per cent dividends and participate
to the extent of ons-half In any sur
plus left after paying dividends on
the stock represented by Washing
ton Railway and Electric holdings.
2. That Washington Railway and
Electric preferred stock be put in at
par, instead OF 7l.42s5. but that 1t
draw only per cent instead of per
cent dividends and be given no par
| ticipation in any surplus.
8. That Washington Railway and
Electric common stock be put In At
F.473.
I. That all stock have equal voting
power.
S. That both preferred stocks have
equal preference when dividends are
paid. instead of being divided into
first and second preferred.
This arrangement would give the
holders Of the $500. 900 preferred
stock of the w. r. a E. the same
amount of preferred stock in the new
corporation, but would reduce their
dividends from to s per cent.
1t would give the holders of the
$500, 900 Of common stock of the
w. r. a e. $3.0s5,12 Of common
stock in the new company.
As all stock would have equal vot-
ing power. the difference in voting
strength would be the difference be-
tween the sl2.o00,000 OF capital Trac-
ton holdings and the s11 ,bS5.T52 (pre-
ferred plus common) OF Washington
Railway and Electric holdings.
The plan was further modified to
provide for q board Of directors con-
sisting Of nine Capital Traction PEG.
pie, seven Washington Railway and
Electric people. and one person to be
selected by the Utilities Commission.
leaving the Capital Traction in con-
troll.
The justification set forth in their
statement, for insistancs on advan.
tage in capitalization and in manage
ment on the part of the Capital Trac-
ton officials is the greater relative
value Of that company, It's greater
earning capacity, its much smaller
bonded Indebtedness, and the greater
present value of its securities.
The Capital fractions two offers
were turned down by the w. r. a f.
Tomorrow I will present the Wash.
inston Railway and Electric's pro-
posal