New-York tribune., 1922-09-01
I. II. 4. to Paw
mt est on
Notes TODAY
Will Request u. s. Court 10
Extend Il i m e for Set
sIenaens of PRINCIPAL
Sum, Also Due Now
Security Deposits Urged
Hedlcy Declares Nearly 90
=. c. Have Consented
so The Manhattan Plan

Frank Hediey, president Of The In
terborough Eapid Transit Company,
announced yesterday that funds for the
payment of interest due to-day on the
three-year per cent notes had been
deposited with J. P. Morgan for pay
ment to noteholders. He stated that
the company is unable at this time to
pay any part of the principal, also due
to-day, and it will seek q further ex-
tension of the issue in the United
States Court.
company was unable TO pay year ago
when they became due. Noteholders
were asked to agree TO an extension at
an increase of l per cent in the an
nual interest rate that a receivership
might be avoided. Seven of the note
holders brought suit, however, and
their action is now pending in the
United States Court.
Holders of more than three-quarters
of the notes, according to Mr.. Hedley,
have assented to the Interborough-
Manhattan reorganization plan and the
holders of about S9,000,00 have failed
to give their consent. He said that the
prompt deposit of the remainder of the
the adoption of the plan in the near
future. The provision for the notes in
the plan is for an extension for ten
years upon payment of 10 per cent of
the principal.
Extension Granted
zone year ago" said Mr.. Hedley's
statement, the interborough was upon
the verge of receivership. On Sep
tember last year over $4,000, 900 of
these same notes fell due. The com
pany's credit was exhausted. 1t could
not raise this large sum or any part
of it. The notes were held by 1910
persons. We asked them to grant q
years extension Over 981s per cent
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.
"The application for receiver in
the United States Court has been post
Mayer to give the company chance to
get on its feet and, if possible, prevent
any loss by it's creditors. The matter
will come before the court again to-
morrow, when further postponement
will be sought in view of the encourag-
ing prospects for the success of the
proposed readjustment plan.
Only One Pressed Claim
an addition to these 7,e10 note
holders there were 4,392 Manhattan
stockholders to whom their dividends
had not been paid for the rental of
the elevated roads. All but a single
one of this number have refrained
from pressing any claim. The general
creditors have extended the utmost in
diligence. For all of this kindness and
public spirit we are exceedingly CRATE
full ~ Pc n
Mr.. Hedley said that nearly 90 per
cent of the Manhattan Railway stock
holders have expressed their approval
of the plan, which involves lowering of
Favorable action from other classes of
security holders is expected in suf-
icient volume to assure its success.
More than 80 per cent of the owners
of Interborough Rapid Transit stock
and the underwriting syndicate has
agreed, upon contamination of the
plan, to advance $10,50o,O00 in cash to
rehabilitate the finances of the COM
pany.
Prospects Encouraging -
"The prospects are most encourag-
ing" declared Mr.. Hedley, "but time is
very important. 1t would be a great
pity if the company should, in spite of
the aid so far given, be compelled to
drift along further in its crippled
financial condition. The public can
best be served by a company which is
not living from hand to mouth. I
most urgently beg that every outstand-
ing security holder take action at once
by the deposit of his security with the
appropriate committee"
Certain notifications in the read
justment plan are understood to have
been made which make it more accept
able to the non-assenting Manhattan
stockholders.