Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1924-03-01
RATHRON WORKS
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BATH HUN WORh0
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skelton of Lewiston was selected as
chairman of the meeting.
chester A. Jordan of Portland.
pubIic accountant. testified In De.
tail as to his audit of the books OF
the company. The las, sIateMens
showed a deficit of $74O.O614S and
in addition an outstanding claim by
the federal. government for $312.-
6a8 AZ for income and war or excess
profits taxes.
Letter From President Cobb
The following letter from Ex-Gov.
william T. Cobb Of, Rockland. the
president Of the corporation. 10
Iran ". Kicker of South Poland.
the chairman Of the bondhoioers
committee, was read:
. 1.-THE present depressed conditions
Of shipbuilding. both for governIenite
and for private. account. make IL
extremely difficult. If not Impossible,
for the Bath Iron Works. Ltd. 10
earn its operating expenses. and II
the business Is to be continued
reorganization of the Company
financial structure which Will reieVe
AZ from its existing fixed charges, ana
at the same time supply necessary
working funds Is both necessary ana
inevitable.
BASED upon the experience OF the
last twelve months, the operating
management believes that the COM
many can secure, within a reasonable
time work in lines other than SNIP
building which will enable IL to con-
tinue in business without further I'M
pairment and to retain It's hlghIH
developed and valuable technical Or
ganization until conditions SHAH I'M
prove.
"During the last three weeks more
specifications and inquiries Tor WORK
have been received than for three OF
four preceding months, and inc
prospects for immediate opportunity
to bid on several hundred thousand
dollars worth of work are now most
encouraging.
."It is obvious, however. that pn-
til the immediate future OF the piant
&C. determined the management Is not
| justified in seeking or closing new
| business involving contracts. II the
| Company Is to continue. the basis
| for such continuance must be estao-
| lished without further delay ana
! prompt action on the part or the
bondholders is necessary to prevent
additional embarrassment and 10 en-
able the management to sohclI
business vigorously and to give as
surances that it can be carried 10
| completion If secured.
with this end in view and in the
| earnest hope that your committees
will continue to do everything In lts
| power to effect speedy settleinen'
of all the questions now under dls-
cussion the board of directors rec
ommends the following plan OF re-
organization and has instructed me
to submit the same for your conslo-
Grafton:
"By agreement of the present
bondholders, interest be waived 1or
a period of five years, upon the un,
Outstanding that the interest waved
will be paid. If and when earned,
| before any payment Is mace on any
other securities; that the sinking
fund requirements of the present
mortgage be waived for the same
period, and that the quick assets De
released from the lien of the mort
gage: that a new preferred stock pe
issued in exchange for the debenture
| notes in like amount; that the pres
emf preferred stock remain as at
7 present or receive in exchange mere
for a like amount of new preferred
stock Junior only to the preferred
stock to be issued to the debenture
| holders: that the common stock re-
ceiye in exchange therefor an equal
amount Of shares OF new common
| stock without par value; tnat the
present bank creditors be paid one
| half of the amount now DUE the
| banks continuing the balance as a
| line of credit to the Company ana
and that a majority of the board of
directors be designated by the bond
| holders.
ut is suggested that the above re-
organization take place withoH tne
organization of a new company by
NV the consent of all concerned, but
in the event that 1t Is not possible to
obtain such consent. the bondholders
foreclose their mortgage under
plan which will lead to the same re-
suit.
1.-The creditor banks have already
signified their willingness to accept
in substance the foregoing plan.
Committees Report Discussed
Associate Justice Charles ]. Dunn or
Orono, a member Of the bondholders
committee, explained various items In
the report of the committee.
Ex-State auditor T. F. Callahan OF
Lewiston started some fireworks at the
conclusion of Judge Dunn's explana-
tions.
"why Is It," said Mr.. Callahan. that
this concern showed deficit Of half a
million dollars in the period from 1917
to 1922, whereas for the five years prior
to 1917 it showed big surplus?"
1.-THE money Of the people In the saw
ings banks of Maine should be protect
ed" continued Mr.. Callahan.
I'VE have had proceedings in this