The Findlay Jeffersonian. [volume] (Findlay, Hancock County, Ohio) 1870-1881, 1876-07-14

much aStOnlShed, as We atterwart learn
ed from sources which We believe are
entirely reliable, that the information
brought by us to their attention, and
haye become considerably awakened
to the position which they occupy as
Trustees for the stockholders of this
company"
From the New York Express (Dem.l1
Startling Revelations Concerning Another Road
Astonishing Discoveries by Stockholders
Committee e-CorpOratiOn Counsel Wlitney'S
Astonishing Revelations
The revelations already published in
these columns regarding Gov, Tilden's
operations as a railroad lawyer, do not,
by any means, comprehend all that is
charged against him, and is intended
to be used against the Democratic par
ty, should he be its nominee for the
Presidency, during the coming CAM
paign. For the second chapter which
the party will be called on to defend.
the enemy has selected the construc-
ton and lease of the Belleville & South
ern Illinois Railroad, the particulars of
Which demand Just as much ventila-
ton and explanation as any of the
other railroad operations in which Gov.
Tilden has been engaged. 1t will not
be out of place, however, previous to
laying the facts in this ease before the
the reader, to produce some additional
evidence, in the support of the allega-
tions already set forth in the case of
the
ST. LOUIS, ALTON u TERRR HAUTE ROAD
On May 81, 1873, the stockholders of
the st. Louis, Alton & Terre Haute
Railroad appointed a committee to go
60 st. Louis to attend the annual meet
ing, and to ascertain the condition of
company, and procure such other infor-
nation as might be for the interest of
the stockholders. The committee took
with them, as their counsel, a rising
member of the legal profession, Mr..
William G. Whitney, now Corporation
Counsel of the City of New York. This
committee claimed to have cast in the
election for Directors II minority of
the votes legally polled; but some of
Mr.. Tilden's associates in the company
voted on proxies in some cases eight
years old, and in one instance attempt
ed to vote on the proxy of a dead
bondholder. The Inspectors of Flee
ton decided against the contesting
stockholders, and the old Board re-
elected their favorites. On this Mr..
Whitney asked to be heard before the
Board, and being granted IL hearing
made scathing speech The com
mittee finally returned to New York
and made n report 70 the stockholders.
drafted by Mr.. Whitney. The official
copy of this document bears the sigma
lures of the committee with that OF
w. G. Whitney, counsel to the CON-
mittee. From this report we take the
following extracts, which tell their own
story:
ILLEGAL ISSUE Or BOMBS.
The next matter to which the at
tention of the board was called was
the question whether there has not
been an illegal issue of portion of
the bonded indebtedness of this COM
pany, n matter which is connected with
the relations between the corporation
and the old purchasing committee un-
der the reorganization in 1861 and 1862.
In that connection we called their at
tention to the following undisputed
facts.
'First-The road was reorganized
in 1861 and in 1862 III accordance with
certain laws which permitted the cred
itors and stockholders of railroad
corporation to enter into an agreement
for reorganization or capitalization,
providing for the purchase of the
property by Trustees for them, and the
forming of a new corporation in which
the old stock and the old debts should
be represented by new stock and new
bonded Indebtedness, which new bond
ed Indebtedness should be distributed
according to the terms of the agree
ment for reorganization by the trust
ees, i. e., the purchasing committee.
The agreement was made, the road
was purchased under the agreement,
and new securities were distributed.
Second. The laws provided that
within six months after the organization
of the new company, all claims which,
under the laws of the agreement, were
to be satisfied by the mortgage bonds
of the new company, must be- put in,
and at that tiIne-namely, upon the
expiration of the six months il such
claims were not properly made upon
the new eompany-if the old bonds
and coupons were not surrendered at
the time-they cease to be claims there
after upon the property.
''1n June, 1862, the certificate Of
incorporation of the company was filed
and in that month the property passed
into the hands of a new corporation,
out of the hands of Mr.. AZariah G..
Flagg. the Trustee who bad been in
possession of the property for con
siderable time, by virtue of the proyis-
ions of some previous mortgages which
were taken up by the new Organiza-
ton.
Third Some time in the year 1863,
more than six months after the organ
ization of the new company, Mr.. Fiagg
made and printed q report, showing in
detail the distribution of the securities
of the new corporation, and after in
Guiding everything that was claim to
be satisfied by mortgage bonds of the
new company. and all the expenses of
the reorganization, including -, 900 to
Mr.. Bayard, as Chairman Of the Pur-
chasing Committee, and 81, 500 TO Mr..
Charles Butler. each for three years
services, and 81 900 to Mr. Samuel j.
Tilden as counsel and trustee, these
payments feing in cash, he states as
follows:
''It is seen by the preceding state
ments that the trust mortgages under
which the first and second bonds are
issued, authorized the creation OF "A
new debt equal to S2S4, 713 40 beyond
the basis furnished by the old bonds,
coupons and so forth, as already set
forth:
'' That is to say. in Issuing the new
securities they had very prudently al
lowed for n margin over and above
what would be properly required,
which margin, after the accounts were
all made up. seems to have been this
sum of SIS, 713 10
''In point of fact, everything which,
by the terms of the agreement of re-
organization, was constituted claim
upon the new bonds seems TO b. COW
cred in this account In point of law,
it was not within the power of the
purchasing committee to create new
liabilities for which these bonds should
become responsible, inasInueh a. the
time allowed by law for the presenta-
ton of claims on these bonds had eX-
pired. And at this time, when, in