Motion Picture Daily (Oct-Dec 1958)

Motion Picture Daily Wednesday, November 19, 1951 PERSONAL MENTION M RAMSES NAGUIB, prominent • Egyptian producer, is scheduled to arrive in New York today from Cairo. After a short stay, he will leave here for Hollywood. • Charles Rosenblatt, vice-president of International Film Distributors, will leave New York on Sunday for South America. • Frank Buehler, industry veteran who formerly was general manager of the old Stanley Company circuit, is a patient at Graduate Hospital, Philadelphia. • Sonny Witzling, assistant to Bert Orde, head of motion picture advertising at "Redbook," has returned to New York from Europe. • W. Ward Marsh, film editor of the Cleveland "Plain Dealer," has returned there from Hollywood. Sidney Schenker, specialist in theatre design, was in Albany, N. Y., last week from his Paterson, N. J., headquarters. Hendricks, Lieber Head Academy Publicity Unit From THE DAILY Bureau HOLLYWOOD, Nov. 18. Delegation of responsibilities for promoting and publicizing the 31st annual Academy Awards were finalized at a meeting held here yesterday, between representatives of the Academy and the Motion Picture Association of America. Overall organization will be in the hands of a public relations coordinating committee, headed jointly by the two representatives of the Academy's public relations branch serving on the board of governors, Bill Hendricks and Perry Lieber. Other committee members are Sidney Blumenstock and Clarke H. Wales of the MPAA; Casey Shawhan, NBC, and representatives of Harshe-Rotman, Inc., the Academy's public relations firm. Ruling on Loew 's Plan Near No Proxy Fight; Brandt Is Chairman Harry Brandt, president of Brandt Theatres and the Independent Theatre Owners Association of New York, is serving as motion picture industry chairman of the New York State Citizens Committee for the Public Schools, Inc., according to an announcement by Ward Melville, chairman of the committe's special advisors. (Continued from page 1 ] it approves the plan, attorneys for Loew's Inc. and Loew's Theatres would confer with Silverman on the form of an order incorporating the safeguards sought by the Government, which would then be presented for the court's signature. Silverman spoke favorably of the plan, joining in telling the court that the proposed division of assets and liabilities between the two companies appeared to be fair and in the interests of stockholders as well as the future economic health of both companies. Highlights of the plan, as reported earlier, would give the new picture company the Loew's records, music and television interests in addition to the domestic and foreign productiondistribution assets and foreign theatres. The new theatre company would receive U.S. and Canadian theatres and radio station WMGM, New York. Companies' Responsibilities Set The theatre company would be responsible for $5,000,000 of the funded debt (after payment of the January 15, 1959, principal and interest installment) and the picture company would be responsible for approximately $20,000,000 of the funded debt. The theatre subsidiaries owe to Loew's, Inc. $17,415,000 of obligations evidenced by bonds and advances, and Loew's Inc. owes $5,000,000 advanced to it by the theatre subsidiaries. Under the plan, these obligations, one to the other, would be forgiven. For a period of 18 months after the date of distribution of the stock in the new companies, or following next Jan. 15, whichever is earlier, Loew's Theatres would make an interest payment every six months of 3% per annum on 20 per cent in principal amount of the debentures from time to time outstanding during the period. Annual Payments Permitted In addition, in the event that Loew's Inc. refinances the debentures within the 18 months period under an arrangement which relieves Loew's Theatres from all liability in respect of any obligations incurred in connection with such refinancing, Loew's Theatres would pay to Loew's Inc. $5,000,000 in cash (or at the election of Loew's Theatres, $1,250,000 annually in each of the four 12-month periods succeeding the date such refinancing becomes effective, plus interest at the rate then applicable to the indebtedness incurred by Loew's Inc. to effect such refinancing). Loew's Theatres would pay $5,000,000 principal amount of the debentures at any refinancing after the expiration of said period as a result of which Loew's Theatres is relieved of liability or at their maturity if no refinancing takes place, but would make no other payments of interest or principal in respect of the debentures. Loew's Inc. would pay all interest and sinking fund installments in respect of the debentures becoming due after January 15, 1959, less the interest payments payable by Loew's Theatres. Loew's Theatres would assume joint and several liability in respect of Loew's Inc.'s debentures by executing a supplemental indenture in accordance with the provisions of Section 3.18 of the indenture under which the debentures were issued. The company now pays interest at 3% on the debenture debt of $26,000,000. The management plan gives the company an opportunity to refinance at the propitious time. O'Brien, Friedman Testify Robert O'Brien, Loew's vice-president and treasurer; Weldon Powell, an accountant and special consultant, and Leopold Friedman, president of Loew's Theatres, testified on behalf of the plan. O'Brien said that distribution of the new stock would be undertaken as soon after approval of the plan as possible, but pointed out that FCC approval is needed for transfer of the radio station to the theatre company and that application must be made to list the stock of the new theatre company on the Exchange. Powell described the division of assets as logical and that of liabilities as reasonable. Each company, he said, would have a 20 per cent ratio of debt to capital. He said the economic future of both should be good and commended the management of both companies, pointing out that they had made excellent progress this year. Sees Conditions Fulfilled Friedman testified he believes the plan fulfills the conditions of the decree and the aims of the court; that it gives both companies a good outlook. In reply to a question, he said he expects the theatre operations to continue to be profitable. Silverman said he considered the theatre company's pro forma net worth of $57 millions an 11 to one cushion against the picture company becoming responsible for the debts of the theatre company and, conceivably, being tempted to favor it. He added that the $5 millions of debt of the theatre company should not prove so burdensome as to inspire favortism from that source. Net Worth $80 Millions The net worth of the picture company will be $80 millions, or about four to one that it won't be obligated to the theatre company. Judge Palmieri remarked that the lie ' (Continued from page 1) stantial representation on the Loew' board of directors," they said yestei! day. 1 The long-delayed statement on w Loew's situation, released shortly bej fore the start of the hearing on math agement's plan in U.S. District Couij here, was signed by Newman but in it he spoke for Green as well as hiir' self. The two directors were defeatei! recently in their efforts to substitute plan to accomplish the divorcemer! by the spin-off of the Culver City stu! dio rather than Loew's theatres. Tfc1 Loew's board of directors voted the; proposal down. Their Support Withdrawn In the statement yesterday New man said that he and Green had pre viously secured support from "largi stock interests" which "had been ils the situation for a long time and haj j representation on the board c ' Loew's." These interests, he said which "originally and continually esj pressed themselves as being complete; -' ly dissatisfied with management" no\{"'" state that they "are unwilling to be come participants in a contest sue as is here required." "Under these circumstances an! ;[ with this support withdrawn," ft " . statement continued, "Green anK . Newman are unwilling to enter into j !'.''. proxy fight. However, this decisio! ! does not preclude participation i! plans to obtain very substantial repr< sentation on the Loew's board of dl rectors." There was no indication v the statement as to how they inteni to seek to achieve the latter. Green Defends the Plan Defending the Green Newma plan, Green said it "included fh . likelihood of the opportunity for tl ] stockholder, who so desired ( but on! at his election) to tender his stock the proposed spun-off production-di tribution company at a price substai tially equal to the market price f< all the Loew's assets. Yet he woul retain his stock interest in everythir except production-distribution. Tl stockholder who elected not to tend< the spun-off stock would have an ii I vestment in a production-distributic 1 company backed by people with su ficient confidence in their own abilil I to invest upwards of $35 million w der experienced management with world-wide reputation." court doesn't want a plan that woul ; goad either company into improvidei1, action. He praised the concise arj prompt presentation of the plan, poiif ing out that he had made provisic even for additional time in the eveH a plan was not presented by the cu rent deadline, August, 1959. MOTION PICTURE DAILY. Martin Quigley, Editor-in-Chief and Publisher; Sherwin Kane, Editor; James D. Ivers, Managing Editor; Richard Gertner, News Editor, Floyd E\,f};01 Photo Editor; Herbert V. Fecke, Advertising Manager; Gus H. Fausel, Production Manager, TELEVISION TODAY, Charles S. Aaronson, Editorial Director; Pinky Ilernnan vmce Canby, Eastern Editors. Hollywood Bureau, Yucca-Vine Building, Samuel D. Berns, Manager; Telephone HOllywood 7-2145; Washington, J. A. Often, National Press Club, vva " Hope Williams Burnup, Manager; Peter Burnup, Editor; William Pay, News Editor. Correspondents m principal capitals of the world. Motion Picture Daily is published daily except Saturdays, Sundays and holidays, by Quigley Publishing Company, Inc., 1270 Sixth Avenue, Roc*efell Center New York 20, Telephone Circle 7-3100. Cable address: "Quigpubco. New York." Martin Quigley, President; Martin Quigley, Jr., Vice-President; lheo. J. bulliyan, vice-rre. dent and Treasury; Leo J. Brady, Secretary. 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