Evening star. [volume] (Washington, D.C.) 1854-1972, 1935-10-05
DISPUTE ON BONDS
ENDED BY COURT
Press Building Plans for
New Securities Are
Explained.
BY EDWARD C. STONE.

District Supreme Court approval Of
the plan of reorganization OF the Ma
tional Press Corp, owner OF the Ma
tional Press Building, brings National
Press Building securities back into the
limelight and incidentally ends very
bitter controversy between protective
committees Just what the various
security holders will get was matter
Of wide interest in the financial dis
trict today, following yesterdays an
nouncement
Approximately 81 500 900 of the first
mortgage sinking fund 51a per cent
gold bonds are held in Washington,
the Washington Protective Committee
reported today. The remaining bonds
of this 81, 200 900 issue are largely held
in Philadelphia, Boston and Chicago.
Under the plan just approved by
District Supreme Court Justice Oscar
r. Luhring, holders Of these original
senior bonds will receive new l5-year
first mortgage bonds, dated January
/, 1885. These bonds will pay 3 per
cent fixed interest per annum and a
2 per cent additional cumulative
income per year provided such income
Is earned.
In addition, each holder of a 81 900
first-mortgage bond will receive one
share of new preferred stock and one
share of common stock in the new
corporation.
Sinking Fund Provided.
The plan also provides for sinking
fund of minimum of $4,000 per
year, nom accumulative. This sink
ing fund must also be earned" the
plan states in the outline of details.
Holders of the old general mortgage
81 per cent sinking fund gold bonds
will get q new $1,000 second-trust
income bond for each 81 900 bond now
held. This means that the reorganiza-
ton calls for a new second-trust mort
gage. The reorganization plan also
states that preferred stockholders, for
each 500 par value share held, will
receive two shares of the new pre-
ferred stock, while the common stock
holders will remain in the same posi-
ton as they are now. The Press Club
has been allowed to retain its COM
mon stock and new common will be
issued for distribution among the
bondholders.
The reorganization plan signed by
the court, upon presentation of the
requisite number Of consents from all
classes of creditors and stockholders,
shows the substance of the sugges-
lions offered by the Washington First
Mortgage Protective Committee was
accepted by the court.
The Protective Committee, acting
for security holders here and several
in Philadelphia, was composed of
James M. Johnston, head of James M.
Johnston & Co., chairman, and
Thomas C. Montgomery, vice president
of Waggaman & Brawner, with At
torneys Norman B. Frost and Paul E.
Lesh as counsel.
Advisory Committee Named.
Under the plan approved by the
court, an advisory committee is set up.
This is to consist of four representa-
tives of the f1rst-mortgage bond inter-
estS and one member representing the
general mortgage bondholders, namely,
H. Prescott Galley, president of the
National Savings & Trust Co.; Vernon
G. owen, real estate dealer; James M.
Johnston, George Ramsey, of New
York, and H. P. FaXon, Boston.
Chairman Johnston of the Protec-
tive Committee organized here, ex-
pressed wide satisfaction over the
court approval of the plan. He be-
lieves it exceptionally fair. All hold
ers of an equity in the old corpora
ton are permitted to retain an equity
in the new organization. At the same
time he considers that the compro-
mise agreed upon gives full protection
to the holders of the first mortgage
bonds.
The Advisory Committee, just
named, will have control over all
leases made in the Press Building
during the 15-year life of the first
mortgage, and also have final au-
thority over all other matters per-
tanning to management of the prop
erty.
L. B. Campbell has been receiver
for the National Press Building. The
company first got into difficulties in
1882. At the present time the build
ing Is enjoying high percentage of
rentals, large amount of space be-
ing used by the Government
The present voting trustees Of the
National Press Club-John. Hays
Hammond, Eugene Meyer and Carter
Field-have been retained. They will
choose directors of the recognized
corporation.
Southern Railroad Nets Off.
f. Class I railroads in the Southern
district for the first eight months of
1885 had net railway operating
income of $29,671 900, which was at
the annual rate of return of LAS per
cent on their property investment.
For the same period in 1894,
their net railway operating income
amounted to S36,522,317, which was
ut the annual rate of return of 1.76
per cent on their property invest
ment.
Gross operating revenues of the
Glass I railroads in the Southern dis
trict for the first eight months in
1885 amounted to S278 1872, $40, an in
crease of IA per cent compared with
the same period in 1884. while operat-
ing expenses totaled s222,613 ,004, an
increase Of So per cent
Glass I railroads In the Southern
district for the month of August had
net railway operating income OF
$3242S39, COMPARED with S2.9l0.l72