THE BUILDING

Northern Advocate, 27 July 1935, Page 10

THE BUILDING

! WINTER SHOW DEBENTURE CONVERSIONS NEGOTIATIONS FAIL ANOTHER ATTEMPT TO BE MADE Now that the Winter Show is over, the thoughts of the. Whangarei Winter Show Committee and the A. and P. Society are turning to the question of the Walton Street building, and whether it will be used for future winter shows. It all depends on whether the Winter Show Committee will accept the offer made by the A. and P. Executive last night. The problem was debated at considerable length, and the upshot was a decision that the executive would hand the building over to the Winter ' Show Committee at the existing lia- : bility of £3120, and would endeavour, if the committee accepted, to get the B debentures converted to free of intfircst An attempt had been made by the society to get the B debenture holders to convert their holdings to 75 per cent of their face value, and to be noninterest bearing. A circular letter had been sent to all holders, but it was announced that the idea had - fallen through, owing to the refusal -of one of the principal holders to convert. Circular Letter. The circular stated that the Winter Show Committee had offered to run ' the show for and on behalf of the ; society, on the proviso that, in the ■ event of the show. proving a success, the Winter Show Committee would have the right, if it so desired, to take over the Walton Street land and buildings, at a sum not exceeding £2500, and that that amount be interest free, redeemable at the rate of not less than 5 per cent per annum. The new organisation, the letter .went on, would, from June 1, 1935, conduct the Winter Show entirely distinct from the Arand P. Society. After discussion, it \yas resolved that all B , debenture holders be invited to convert their holdings into a fresh issue at 75 per cent of the present face : value, bearing no interest. The committee was of opinion that the acceptance by B debenture holders would be in the best interest of all concerned, as the alternative appeared to be that the Winter Show Committee would form a new -organisation, ,-» procure a fresh site and conduct a ■ ■ winter show apart from the society. In that case, it would appear almost ■ •certain that the B debenture holders would lose all equity in the present „ Winter Show property, or, at the best, receive a few shillings in the £. . . On the Walton Street property there . was, ranking prior to the B debentures, £ 1000 worth of A debentures in the ' ‘ nature of a first mortgage. The society, therefore, having no assets to meet the liabilities, considered, that the offer of-the Winter Show Committee was a better one than having to realise, on tf.a sale, on its asset at Walton Street, and asked holders to assent to the pro- • posal. Exception To Letter. L . The chairman, Mr. T. J. Griffin, thought, in view of the failure of the attempt to convert, that the future _ method of running was to enlarge the A. and P. executive sufficiently for Separate committees to run the winter . ,and summer shows independently. Mr. H. W. James: “What about the Finance Committee?” Mr, 'Griffin: “Each committee would ; have to be its own finance commit- ; toe-.”-The chairman added that the running of a winter show was a job for • the town members of the society. Mr.-H. W. Crawford took exception to the circular letter, and thought it unfortunate it had been issued. There was an implied threat in it, he said, „ to those who had come to the aid of the society 11 years ago, and provided funds for the erection of the building. 'The letter practically told them to ... convert or to take the building back on their own hands. The society, he considered, was worse off as a result. Statement Of Fact. v , Mr. James, on the other hand, did not see that any threat was implied, -■ and that the letter had contained a bald statement of facts. There was, he said, a suggestion that, in the event :of negotiations breaking down, the Winter Show Committee should seek . another site and erect a new building. “I think there is a threat in the ■ letter,” , said .Mr. C. V. Stringer, “and that as the only way to go about it. You have to threaten to get anywhere • today.” Mr. Crawford’s point was that he .considered it unfair that the B debenture holders should be asked to sacrifice 25 per cent of their capital, as well as the interest. He thought that if the society could get the holders to convert to free of interest debentures, it. was the best it could do. ■ The letter was approved. Too Big A Burden. Both Mr. James and Mr. Stringer thought it would be saddling the Winter Show Committee with too heavy a burden for them to take over the building at the existing liability—£3l2o—and also to take in hand the repairs and extensions, which were necessary to the building. Mr. Stringer: “If the new Winter Show Committee cannot get the building at a figure, they will have to get a new property and build themselves.” Mr. Crawford: “J ' think the only thing is to ask the debenture holders to forgo their interest.” Mr. James: “Will the A. and P. Society find the difference between £2500, at which the Winter Show Committee is willing to take the building over, and the existing liability?” Mr. Crawford: “No. .If you get the property for £3OOO free of interest you should be able to carry on successfully.” What Committee Wants. * Mr. James said the Winter Show Committee had run the recent show thinking they would be able to carry on at the figure they wanted. They would not come in and run it under any other conditions. They had worked hard to put the show right, thinking they would get the building for £2500, free of interest. Mr. Stringer added that the show was conducted with the idea that the A. and P. Society would hand the whole concern over to the Winter Show Committee. It was, he considered, a fair deal to ask the debenture holders to forgo 25 per cent, of- their capital, as well as the interest, in that if the show was not held the A de- ( benture holders would step in and get the building. The B holders would | then get nothing. 1

Following a good deal of discussion, Mr. Crawford moved that the A. and P. Society offer the property to the Winter Show Committee at the.existing liability, and that in the event of acceptance, the society endeavour to get the B debentures converted to free of interest debentures. Mr. James: “It is a waste of time. There are two alternatives. One is to hand the building over to the debenture holders and let them do what they can with it, and the other for (he A. and P. Society to carry £6OO of the liability.” Motion Carried, Mr. Griffin moved an amendment that the society was unable to give the Winter Show Committee a definite decision, but that it charge the committee a rental of £125 for the next winter show, that sum to be taken off the purchase price if the building was eventually taken over by the Winter Show Committee.

Mr. Stringer said, he would secohd the amendment if a clause was included to the effect ;that the society hand over the building in a satisfactory state of repair. Mr. Griffin, however, would not do that, and the amendment lapsed. The motion was then carried, the voting being four for, and three against. The chairman did not vote. The motion was referred to the Finance Committee. What The Answer Will Be. “I can tell you the answer to that resolution now,” said Mr. James. “The Winter Show Committee will turn it down.” He was supported by Mr. Stringer, who stated that inquiries had been made on behalf of the committee in regard to other properties, and it might easily happen that the committee would decide to go elsewhere and leave the society in a hole. He knew, also, that there were some people in the town willing to provide money for the erection of a new building. Mr. Crawford; “Can you suggest an alternative to the resolution?” Mr. Stringer: “Yes. Pland the building over to the debenture holders.” Before the question was disposed of, the society placed on record its appreciation of the successful manner in which the Winter Show Committee had run the show. Finally, just before the meeting closed, it was decided to recommend to the Finance Committee that it pay no interest and do not dispose of any of the Winter Show profits until some finality was reached in regard to the Winter Show property.