will be issued on the first day of the next succeeding dividend period and will bear dividends at 6% per annum from date of issuance. Stockholders may increase their subscriptions beyond the amount allotted subject to allotment of any part of the $12,500,000 not taken as above. If by August 15, 1914 the company shall not have received subscriptions for, or otherwise disposed of, at least 70% of the stock herein offered, the amounts paid on all subscriptions will be returned not later than September 1, 1914, with interest at 6% per annum. At $82.50 per share this stock yields 7.27% per annum on the investment.-V. 98, pp. 1760, 1778. READJUSTMENT OF DEBT OF HUDSON & MANHATTAN RAILROAD COMPANY To the Holders of the First Mortgage Four and One-half Per Cent. Bonds and of Preferred and Common Shares (and Voting Trust Certificates) of the Hudson & Manhattan Railroad Company. At the request of holders and representatives of a large majority of the above bonds and shares, the undersigned have caused to be made, by independent competent experts, an examination of the properties, earnings and financial condition of the Hudson & Manhattan Railroad Company. Summaries of the reports of this investigation are appended hereto. These reports show that the Hudson & Manhattan Railroad Company has not earned, and is not now earning, the full interest upon its outstanding First Mortgage Four and OneHalf Per Cent. Bonds. It, therefore, cannot market securities to provide funds to pay the cost of improvements and betterments, nor has it the funds to pay such of its car trust obligations as are approaching maturity, and, unless its fixed charges are reduced through the action of the bondholders and the needed funds are furnished by the stockholders, it will be impossible to avoid the foreclosure of the mortgage securing the First Mortgage Four and One-Half Per Cent. Bonds. The undersigned have accordingly formulated the within plan for the readjustment of the debt of the Company, which has been approved by the holders and representatives of a majority of the First Mortgage Four and One-Half Per Cent. Bonds and of the Preferred and Common Shares of the Company. The undersigned have also agreed to form a Syndicate to purchase from the Hudson Companies the New First Mortgage Bonds and Adjustment Income Bonds which it will receive upon the consummation of the Readjustment, in order that it may be in a position to take up its outstanding collateral trust notes and participate in the Plan of Readjustment. The undersigned believe that the within plan is fair to all interests. It should be promptly accepted with substantial unanimity by the holders of the First Mortgage Four and One-Half Per Cent. Bonds and of the Preferred and Common Shares of the Company in order to avoid a forced reorganization based upon the foreclosure of the First Mortgage. Bondholders and stockholders, to assent to the plan and become parties to the Readjustment Agreement, must deposit their bonds or stock certificates or voting trust certificates, with Guaranty Trust Company of New York on or before February 14, 1913, after which date no deposits will be received except with the consent of, and upon such terms as may be imposed by, the Readjustment Managers. All bonds deposited should be in bearer form, with February 1, 1913, and all subsequent coupons attached, and all stock certificates or voting trust certificates should be endorsed in blank or be accompanied by proper instruments of transfer in blank. The undersigned will, if desired by depositing bondholders, advance to them upon their bonds, at the time of deposit of the same, the amount of the coupon due February 1, 1913. In case the within Plan of Readjustment should be abandoned and a modified or substitute plan adopted by the Readjustment Managers, at least thirty days' notice of the terms thereof will be given in the manner provided in the Readjustment Agreement, and depositors of bonds and shares will be given an opportunity of withdrawing without any payment for expenses. HUDSON & MANHATTAN RAILROAD COMPANY Plan for Readjustment of Debt I PRESENT SECURITIES OUTSTANDING Debt to be comprised in readjustment: First Mortgage Four and One-Half Per Cent. Gold Bonds, due ...... Debt not to be disturbed by readjustment: New York and Jersey Railroad First Mortgage Five Per Cent. $67,148,000.00 113,000.00 $5,000,000.00 1,263,000.00 Real Estate Mortgages (including mortgages upon real estate to be acquired under Plan) 1,207,500.00 CASH REQUIREMENTS (ESTIMATED) To acquire from the Hudson Companies, at cost, real estate on the blocks occupied by the Terminal Buildings (subject to $555,500 mortgages) $435,000.00 Payment in lieu of interest due February 1, 1913, on Present First Mortgage Bonds (excluding $7,148,000 of the bonds held by Hudson Companies) 1,350,000.00 Improvements... 150,000.00 Car trust obligations maturing prior to September 1, 1913... 113,000.00 325,000.00 Recording Tax on new bonds..... 353,045.00 For working capital, expenses of readjustment including compensation of Readjustment Managers and other corporate purposes 1,119,103.50 Total (equal to cash to be provided by payment of $8.50 $3,845,148.50 III PROPOSED ISSUE OF NEW BONDS Five Per Cent. First Mortgage Bonds, bearing interest from earned) from February 1, 1913,1 secured by a mortgage 33,574,000.00 IV DISPOSITION OF NEW BONDS New Five Per Cent. First Mortgage Bonds. To be issued to holders of existing First Mortgage Bonds at the rate of $500 of new bonds for $1,000 of old bonds...... $33,574,000.00 To be issued to preferred and common stockholders for cash payment of $8.50 per share at the rate of $900 face value of bonds for $1,000 of cash paid 2... Total to be presently issued Five Per Cent. Adjustment Income Bonds. 3,461,000.00 $37,035,000.00 To be issued to holders of existing First Mortgage Bonds at the rate of $500 of Adjustment Income Bonds for $1,000 of Old Bonds V $33,574,000.00 BASIS OF PARTICIPATION IN PLAN BY EXISTING BONDHOLDERS AND STOCKHOLDERS Holders of Present First Mortgage Bonds to receive for each $1,000 thereof: In case the Hudson & Manhattan Railroad Co. should make any payment on account of interest accruing from February 1, 1913, on its Present 4%% First Mortgage Bonds, any amount so paid for any half yearly period, shall, to the extent of $12.50 per Bond, be considered as payment on account of the corresponding interest on the New First Mortgage 5% Bonds, and any amount over $12.50 per Bond, as interest on the New 5% Adjustment Income Bonds. 2 See footnote, p. 937. |