New-York tribune., 1881-03-26
BASIS OF THE COURT PROCEEDINGS.
ABSTRACT FROM THE HISTORY or THE NORTHERN
n.n1r1n-Mn unIARn,s ALLEGATIONS.

ABSTRACT FROM THE HISTORY or THE NORTHERN
PAcIFIC-MR. vILLARD's ALLEGATIONS.
The application for the injunction and ordor
is based upon verified complaint and tue amuaVos Vi
Mr. Willard, is the owner OF 10000 snareS Oh pro
ferred and shares stock Of the railroad
company
The complaipt recites that the company executed
Juv / 1870 mortgage or trust deed OF all Its properly
az franchises with exception OF certain Janus heu
under letters patent OF the United States upon which
mortgage bonds the amount OF about $3lOoooVO nao
been issned TO Jay Cooke and Charlemagne Tower to
secure bonds TO issued pursuant 70 an act OF Con-
gress to an amo1ut not exceeding $4,000 mei that
default having been made IT the payment OF the interest
on the bonds issued, Mr. Cooke aud Mr. Tower tne
trustees foreclosed the mortgage by which tne Dohu
were secured and that the foreclosure sale the prop
erty and franchises OF the corporation were bought IN
by Frederick Billings, johnston Lyingston ana Others
who had been appointed committee BY the bondhol6ers
IN accordance with plan adopted June 80. 1873. with
the consent OF the railroad company and It's STOCK
holders and with the sanction OF the circuit court VI
the limited States By the terms OF the plan or agree
meut OF 1875, tie railroad company was 10 nc reoFe
zed and placed under the control and management OF
hoard OF drectors the capital stock was TO be hxed NJ
OO0 and divided into two classes preferred
and common stock. Il was further provided that
preferred stock 10 the amount OF S5lOOoOOO shouid
be issued for the purpose OF reurlns tno
outstanding bonds aud the overdue Interest on them ana
certain other bonds and TOPAZ the floating debt oil the
company IA II existed before the foreclosure. Tne new
preeed stock was be ssued upon the surrender OF
the bonds and other certificates OF Indebtedness In
addition 70 this preferred stock common stock was 70 be
famed 10 sucn persons as should surrender their shares
OF the existing common stock
In pursuance OF tue above plan the company was reor
ganzd aud preferred stock issued 10 the amOunto
$50 the holders OF bonds and other creditors
and S2l 100000 OF common stock was Issued TO the
h of the stock OF the company
The complaint further alleges that under the charter oi
the company ia stock required to be offered Tor
subscription 70 all the people OF ,,d the pnte1 IeG
500 the iail par value for each share.
IL IN also alleged that when all tbs shares OF the pres
sG1 sGSE &c m 81 ns sIs sfsS %
remained 10000 shares OF common ~ OK mnon ~ rTIe ere
not required and which could not Do exchaaeea Ior I9e
preyisy existing stock OF the company that no SUD
scrptOn was ever made Tor these sna,s, Sb uAt r mo
Individual defendauts or some OF them Is claimed not
have directtd as directors or an Executive Com
mttee Of the Board OF Directors the Issue Of certificates
greater portion OF 10 and among certain persons OF
whom the directors form part ana anS wn9
In Le railroad These persons 10 whom this STOCK 10
I've Issued are said clam tho right to II under an agree
neut made prOr 10 the reorganization OF the
company TO divIde among themsciVe. nll the
capital stock Of the corporation without Onerihg 10
nuie subscription Hnd without paying any money Tor
H. ns re1ured by the act OF Congress- which agreement
II ever lawful, rendered imperative y the lore
The order to issue the 10000 shares made by the
deeudants Robert Harris, Benjamin r. Cheney, Joseph
ID Potts Johnston Livingston. William X Garrison and
Frederick Bings or clam To DC, tue Executive
Committee OF lhe Board OF Directors OF the company,
against tho protest II many other directors Inc sSue
OF thes, shares the plaintH Claims, VIII c1use
irrenarabs injury To all persons holding preferred or
common stock OF the company trst because 1t WIZ give
the holders tho unauthorized sh es tue power 70 fo
In ali the proceedings Of the company and second De-
cause the divIdeuds to which the present owners oI
stock both preferred and common, are enlied under
The plan reorgan zlon, would be largely diminished
Certificates for portions aud different amounts
of the 10000 shares OF stock have
been made out, It Is Claimed; 70
and m the names the deicndaDts Frederick Billings
Charles b. Wright. Benjamin T. Cheney, Johnston LV'
ngston Joseph DilwOrih, Joseph ID. Potts, Hugh NC
nllough Ashbel II. Barney, Henry T. JOLnSton Robert
L. B,Iknap, j. Gregory smith, CharlomagDe Tower
LANES SinsOm, William q. Fargo, James Z. Fargo,
CeOrge W. Cass Thomas A. Scott, H. II. Houston, Agran
CObufn, William Suaw, Richard d. Rue L. A. Canhelu'
William Window aud Jesse Huyl. .,
The Farmers' Loan and trust Company u made de-
ut IN suit tU prevent IT, the transfer agent OF
the railroad company registering and permitting
transfers the shares tue issue or which sought 10 De
eniOined Messrs. EmOt Hammond ana kldder are MI
Wizards attorneys iu the suit