The New York herald., 1922-09-01
|. R. 7. CAN'T PAY Off
NOTES AT THIS Time
S38, 100000 Principal Is Due
To-day on Extended Issue
Interest to Be Paid.

The Interborough Rapid Transit Com
?any placed yesterday at the disposal of
p. Morgan Co. as agents sufficient
funds with which to pay the interest due
to-day on both deposited and unde-
posted three year secured convertible
notes of the company.
In a statement announcing that the
interest payment had been me- Frank
Hediey, president of the Interboroush,
pointed out that no part of the $3S,0OO,-
600 note principal due to-day could be
paid at this time. He urged the prompt
deposit OF the remainder of the notes un-
der the readjustment plan which pro-
vides for an extension for ten years upon
payment of 10 per cent of the principal
Mr.. Hedley's statement in part fol-
lows:
"Thirty-eig million dollars OF Inter
borough three year extended notes Will
become due tomorrow, Se2ten Der ], with
4eS semi-annual interest. We have to-day
placed the money for the interest with
cur bankers. Messrs. j. p. Morgan & Co..
for disbursement to the noteholders
'rhe company cannot pay any part or the
principal of these notes at tins time.
THE provision for these notes in the
proposed plan of readjustment Is FOR an
txtension for ten years apon payment or
10 per cent. Of the principal. Over three
quarters of the noteholders have already
assented to the plan but about nine mil
| l'on dollars of the notes have not yet
! teen deposited for extension. The
! prompt deposit of the remainder or these
notes is the only way to make certain
IL adoption of the plan in the near
future.
| "One wear ago to-day the Interborough
was upon the verge OF a receiversnlp.
| On September / last year over S3e,o0o,-
| 900 OF these same notes fell due. The
| company's credit was exhausted. 1t
| could not raise this-large rum or any
part of 1t. The notes were held by
| 7.61O persons We asked them to grant
a years extension. Over 981a per cent
I complied Only seven noteholders
brought suit and they have not yet been
permitted by the New York State courts
to gain an advantage over their fellow
noteholders by the collection OF their
demands.
sSrhe application for a receiver in the
United States court has been postponed
from time to time by Judge Mayer to
give the company a chance to get on Its
feet and il possible prevent any loss by
it's creditors The matter Will come be-
fore the court again tomorrow when
a further postponement will be sought
in view OF the encouraging prospects for
the success Of the proposed readjustr-ent
plan.
"The public interest can best be
served by company which Is not living
from hand to mouth. l most urgently
beg that every outstanding security
holder take action at once by the deposit
OF his security with the appropriate COM
mittee."
At the Morgan offices 1t was pointed
out that such interest on the three year
secured convertible notes of the Inter
borough deposited under the agreement
dated May /. 1922. will be collected by
the committee enabling holders OF the
certificates to collect the interest on the
notes represented by such certificates
upon presentation together with proper
income tax certificates at the offices OF
the Bankers Trust Company. Harris
Trust and Savings Bank Of Chicago Old
Colony Trust Company of Boston and
the Union Trust Company OF Pittsburgh