AVIATION: Crisis at Capital

Monday, Apr. 25, 1960

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Bankruptcy Preferred? While Vickers could force Capital out of business by foreclosing, Capital would prefer to file bankruptcy proceedings before this happened. This could block Vickers' recovery of its planes, give Capital more time to solve its problems. Last week, after a seven-hour meeting with Capital directors to discuss "our serious crisis." President David H. Baker announced that there would be "no interruption in the line's service."

^{* New York Journal-American Columnist Leslie Gould, whose wife
is Althea O'Hanlon, assistant vice president of Capital and a close
friend of Murchison's, charged that Murchison (no kin to the wealthy
Texas Murchisons), armed with inside information, sold two-thirds of his
shareholdings around the time when Capital stock was at a peak ($41.50)
four years ago, later bought back his stock at substantially lower
prices, quadrupling his former shareholdings. His law firm has been
paid $588,500 in legal fees by Capital in the past six years.}