New-York tribune., 1922-01-31

standing. These bonds consist of;
- ordsriyinE bonds Trincipal Interest.
's; dn~ i92s........ s34125.ooo s. ss5. 900
/ D. & Il. G first cons.
= ';s due 1850. $4,000 as7lao
RIO G W. fret trust
:, fs' dnc 1899 ......- 15.1so.ooo so7 son
I Rio G. w. first cons
/ Is, due l9fn..... 5000. .o0h co9 con
j0oior '0r1' 'S.''''' bonds s7''l's''0' 's's''740
/ y. 4 r. c. nrst ref
Is due 1855. ...... sl.1l.ooo 1.s55.7oo
! +. e r. G.. adj. cum
in;. Is, due 1879. 100000 700 900
Total ........,... $4l.il4oOo ss255. 700
Grand total ..-... s1sc.22s, 900 s5,5s544o
Under the plan the underlying bonds
Will be 'eft und;sturhed and in place
or me junior bonds there will be issued
sZ0,5hl 900 sinking fund bonds and
I $50, ,o57 900 Of preferred stock. In I'D
ditlon, there will be 100000 shares Of
new common stock OF no par value
The total funded debt OF the old com
pany was Sl26,056,000. and will be
Slol .6sa 900 for the new company.
The total fixed charges Of tho old
company were So,S96.9t0, and Will be
S4,6l3.160 for the rev company, being
Opportunity of Exchange
The plan OF reorganization does not
definitely provide for tho exchange OF
the present outstanding $40 900 900 ad-
: iustnent mortgage bonds of the old
company. but in stating the funded debt
+ the new comesny in the preceding
I paragraph It is assumed that the ad q
iustment mortgage bondholders Will be
given An opportunity to exchange their
! bonds on the same basis as the refund
ing bondholders that is. accepting so
per cent in new sinking fund bonds
and so per cent in new preferred stock
No allowance is made in the preceding
! paragraph for accrued interest on the
adjustment bonds.
The two new mortgages to be made
by the new company arc d unifynG
mortgage and d sinking fund mort
gage. The unifying mortgage is to be
l'en on the entire property subject
to the mortgages of the undsturhed.
and no bonds are to be issued under
this mortgage until all OF the ten mil
lion dollars cash which the Western
Pacific Corporation has agreed to pro-
vlde nas been pa'd IN to the new com
pany. The sinking fund mortgage
bonds arc secured by a mortgage or
all OF the property of the company sub
ject both TO the liens Of the undcr!y-
ing undisturbed bonds and the lien OF
the unifying mortgage. Under this
mortgage there will be S15,557 900
bonds issued, to be exchanged for the
outstanding rcfundirr mortgage bonds.
and it is assumed that there will also
be S6.000,000 to be exchanged for the
S10000000 adjustment bonds of tn,
Old company outstanding
Western Pacific Corporation
The Western Pacific Corporation now
owns the Denver & Rio Grande. subject
TO the mortgage bonds outstanding. it
is proposed to form new company
the Denver & Rio Grandc Western
which company is TO issue 400 600 shares
of common stock, S2o.557 600 of pre-
ferred stock with the additional S. 900
600 when the ad djustment bonds arc
taken in) and S. 80 geo Of sinking fund
bonds (with an additional 5000 600
when the adjustment bonds are taken
in). and Tic new company is to as
sumo the liability for the $79,l120 900
underlying Denver & Rio Grando bonds
The new company is to issue 5000
shares Of It's common stock to the hold
ing COMPANY the Western Pacific Cor
poration. ani receive in exchange the
actua! railroad property; and il is to
issue also 100 900 shares of common
stock to the Wostern Pacific Corpora
ton, for which it is to receive $1O,O00.-
600 in cash. The cash is to be paid to It
S5000,o00 within one year from the
completion of the reorganization. an ad
ditional $3.50, 600 within tho second
year and the remaining 81 100000 with
in the third year.
For tho purposes OF the plan, stock
in The Western Realty Company. now
owned by the Western Pacific Corpora
ton, is to be considered up to the
amount Of 81 100000. as cash, and 700
seventy-ton coal cars contracted for by
the Western Pacific Corporation arc to
be delivered 70 the new company es-
timated at a cost OF l.50O 900, and the
Western Pacific Corporation is to buy.
for cash, the coupons on the outstand-
ing old Denver G. Rio Crande refund
ing mortgage bonds. There is a fur
ther minor adjustment Of Sal 500. The
cost price Of the cars, Western realty.
etc, is to be credited as part of the
$4,000, 600 cash. Besides this. the
Western Pacific Corporation is to turn
over to the Equitable Trust SO 100000
cash or readily marketable securities
This constitutes q guaranty that the
Sl0.ooo,00o cash Will be paid
The old company had on hand on
January I. 1922, only approximately
into possession of the new company
along with the railroad property itself, /
the cash ana the equivalent of cash
which is to be provided by the Western
Pacific Corporation.
The New Company
The new company. if the reorganiza-
ton plan goes through. will have sA.-
6l3 160 fixed charges. In addition dxi-
dends on the new preferred stock to be
issued under the plan would call for
$1.750 900.
In the first eleven months of 1921
the Denver {, Rio Grande earned net
after taxes and rentals s3,224779. Like .
many other roads the Denver G. Rio
Grande in the first half of 1921 showed
very small net earnings, but in the I
second half it has been doing much
better. 1t would appear from the
eleven months earnings statement that
the management had been taking up
extraordinary maintenance, due to
food damage on large scale, the
of way charge being Sc
09l 600 for the first eleven months Of
1921. as compa,ed with s5.725 900 for
the first eleven months of 1920. The
difference is larger than would appear
from these figures because of the
lower cost per unit Of materials and