New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-09-02
Court Grants Weeks
Grace; Holders of 800
Of Notes Due Yesterday
Give Years Extension
Company Appeals
To Remaining Ones
Money Deposited to Pay
Interest, but No Funds
on Hand for Principal

Strong probability that the INTERIOR
ouch Rapid Transit Company will es-
cane receivership loomed yesterday,
when Federal Judge Julius M. Mayer
granted an adjournment until next Fri
day on sn order to show cause why q
receiver should not be appointed, based
uron the applications of the American
Brake Shoe and Foundry Company
and the Continental Securities Com
pany.
The question of receiver now
hinges on the further response of hold
ers to turn in for extension the bal
snte of per cent notes maturing yes
terday. At the close of business yes
terday so per cent OF the notes had
been deposited, and a letter sent out by
the company said it was hoped the
court would decline to appoint a re-
cciver on the ground that, with the
notes extended, the general situation of
the company would justify such q
course.
Company Opposes Receivership
During the proceedings yesterday
counsel for the transit company clearly
indicated that the Interborough was
opposed to a reeeivership, and this
stand was concurrhd in by the Empire
Trust Company, which holds 339,12S
shares of the stock out of a total
authorized issue of $4,000 shares.
In granting the adjournment re-
quested by the Interborough. which was
sssented to by all parties concerned,
with the exception of the Continental
Securities Company, Judge Mayer said
it was of profound Importance to the
public and to the security holders that
there should not be a receivership if
ii could legally and properly be pre-
vented.
With the permission of Judge Mayer
portion Of his remarks during the
proceedings yesterday was incorporated d
in the appeal sent out to noteholders
last night by the Interborough. Judge
slayer was quoted in the letter as fol-
lows:
There are outstanding, according to
the statements of counsel, $38,144,O 900
Of these notes in round figures, of
which upward of s29, 900, 900 have
been deposited, the holders having con-
ssnted to the extension which the
Transit Commission, in the exercise OF
its best judgment, authorized for one
year at 8 per cent. 1t seems to me
That shows very commendable and
extraordinarily prompt willingness or
- l u i
keeping the situation in statu quo. The
have no doubt, will be reduced con.
is understood.
"A receivership in this case woulc
necessarily lead to numerous complica.
tons, and there are great many diff.
cult and complicated questions of Law
with which the court is somewhat
familiar. The desire of the court is
not to see more receiverships, but tc
dispose of those that are now pend.
ing As rapidly as possible, and have
fewer; in fact, none. l think that
everybody who has fair-minded atti-
tude will want to cooperate against the
very ardaous and troublesome results
OF receivership.
In aid of an effort to save this
company from a rcceivership, counsel
for the company may report my re-
marks to the noteholders or any part
thereof that may be deemed proper"
Decision Rests With Noteholders
After quoting Judge Mayer the ap.
peal Of the company said that the fate
OF the Interborough rested in the hands
OF the noteholders, and that there was
at least n week left in which to avert
receivership. The letter further in
formed the noteholders that the full
amount of interest due on all the notes
had been deposited with j. P. Morgan &
20. but that the company had no funds
with which TO take up the principal
nor had it been able to obtain assur-
ance from any quarter that it would be
placed in a position to take up non
asserting notes.
Present in court yesterday were
James l.. Quackenbush, representing
1he interborough; Corporation Counsel
'John , P: O'Brien, representing the city;
Elijah Zoline and George M. Judd, rep
rresenting, respectively. the Continental
Securities Company and the American
brake Shoe and Foundry Company, the
TWO concerns petitioning for receiver
SNIP and William D. Guthrie, repre-
sssnting the Empire Trust Company
me Manhattan Railway Company, the
Guaranty Trust Company and the Bank
fcontnusd on page nIns)