New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1893-08-18
NORTHERN PACIFICS LOAN.
WILL THE COLLATERAL TRUST SCHEME
BREAK DOWN?


RUMORED DEFICI ENCY IN THE SECUR1rf-JoHN
D. ROCKEFELLER NOT A DIRECTOR-THE
THREATENED PHILADELPHIA SUIT
HENRY vILLARD's AFFI-
DAvIr OF DENIAL.
Northern Pacific affairs received a large snare
of the attention OF Wall Street yesterday. OWING "
the publication Of the letter OF Brayton ives Sc
verely denunciatory OF Henry Wizards manage
ment Of the company and the announcement that
n Philadelphia stakeholder moving to secure
proceedings against Mr.. Willard and several OF MS
co-directors Other points OF interest concerned ue
velopments respecting the aoatng debt and the
discovery that John ID. Rockefeller had declneo u
serve as a director OF the Northern Pacific
The exposure OF the attitude Of Mr.. Rockefeller
excited considerable conjecture. as 1t was through
his influence as commonly supposed. that the plan
for funding the floating debt into collateral trust
had reached any stage OF success. III was on june
q that Henry Willard announced that ne nau re-
signed from the Northern Pacific. and the oihcers
Of the company gave out an official statement u
the effect that Mr.. Rockefeller had been elected 10
fill the vacancy Mr. Wizards resignation was to
take effect on July 49, and July II Mr. Rookie
Teller sent letter to the company declining 10
the board OF directors. 1t Is reported on
good authority that this letter created STORM
among the other directors, Of whom Is SAID 10
have denounced Mr.. Rockefeller in vigorous terms
considered officially by the Northern Pacihc ooard
until yesterday, when 1t was announced that MS
resignation" had been accepted. The comment OF
most Wall Street observers when these Facts were
learned for the first time yesterday was that their
treatment OF the Northern Pacific management was
on par with the "uneQuvocal and emphatic de-
NAL given last Saturday by President Thomas F.
Cakes, when he was asked II the papers were be-
ing drawn for a recevershp.
The security holders and creditors Of the Northern
Pacific took keen interest In the news OF MT.
Rockefellers resignation owing to the bearing
which 1t may have upon the position OF the COM
pany's floating debt 1t was asserted yesterday that
tho collateral trust plan was In peril because the
company was unable to furnish all the collateral
called FOR as security TO the syndicate which I'M
dertook to guarantee the success OF the scheme.
II was impossible to obtain satisfactory lnforIna-
ton on this point from the officers OF the company
The story runs that owing to the acute weakness
developed in Northern Pacific securities last week.
before 1t was known that n receivershlp was con-
templated the company was called Upon for more
margins on loans made by Speyer & Co. 'nd kuhn
Loeb & Co. Additional security ~ sdid 10 nave
been furnished in order to avert II't'trous CLOS
ing out OF these loans but this step N reporteu W
have left the company without the apiii'y 10 iur :
nish all the securities agreed TO be placed BACK OF
the collateral trust loan. Should TINS prove 10 De
tho situation II Is feared that the Subscribers TO the
guarantee syndicate may consider themselves re-
leased from their obligations and may "enialu 'ne
return to them OF the 60 per cent cash airfauS
paid In on their subscriptions. The solution CT tns
question Is anxiously awaited, because upon the
success Of the plan for funding the hoaths uep'
may depend important points with regard 10 'ne
financing OF the property by the receivers and It's
ultimate reorganization
Besides acting upon the communication OF MI
Rockefeller the Northern Pacific directors yester-
dav referred to the receivers the letter recciVed
from Read & Petit. attorneys for John Swope the
Phila delphia stakeholder who demands that SUIT
for restitution be brought against a number or
the directors James Mcknight. counsel for the
company said that this was the second letter re-
cciyed BY the officers The first one made speciic
charges which the writer declared could be proved
The Northern Pacific In reply. asked FOR the
proof Mr. Mcknight said that the second COM
munication receded from the stand taken In the
arst and did not establish a second charge. Mr..
McNaught asserted that in these communications
there were charges Of any unwarranted hypoth-
ecatlon, or unwarranted use OF any OF the Sc
curities of the Northern Pacific or the Chicago
and Northern Pacific companies by any Oh tne
officers in any way whatsoever.
At the meeting of the Northern Pac'tc directors
rho following letter from Henry Willard was sub
mitted 800
Mills Errhng New York. August a. 1893.
Thomas f. O,kcs Esq, President Northern Pacific n H.
Company.
n.r sir. duly received your inclosIng the com
mr,,r,t,on Of Mc,.rs Rad ard Pcu made In behalf OF
MIR John swope Of the y. r. H. Il Co. ana bearing '''e
the 9Th Inst.
dr.lrc t, Immediately place record my uneluyocal
denl, al, tho charges made. far a. they In any wlse
rotate 20 mo and {, make emphatic my statement
herewith present AFFIDAVIT on the subject as
couc.,ed Is the company, counsel which VIII sho" YOU
how ah.ortev urwarramd IL would be I" sul c. me {"
the arnoyarcc and expense OF litigation over matrS !"
which took no part. Yours truly, H. WILLARD.
The AFFIDAVIT, requested by the company's coun-
sci is appended:
e,,o =, xovyork CITY and County OF New.York S..
Henry Willard being first duly sworn Opposes and says
l have read the communication under date Of August
4 1898 addressed to the President ana Board OF DIRECTORS
~ tho Northern Pacific RAJ road Company by the oor'
~ ,r rohn t;woIe holder OF si\tvnine shares OF the
stock Of the Northern Pacific Railroad Company and de-
sire 10 rciute much OF the same as III any wise
relates TO me.
II Is no, true as alleged otherwise. that was the
wnor with Mcssr Colby Abbot and oyt of the proper
s in Chicago referred TO- or Of the tocks OF the Great
Western Railroad Company. the Bridgeport ana south
Chicago Railroad Company. and the Chicrgo Harlem and
Datayia Railroad Company.
uncouiyocaly declaro TINT hal no interest In said
real estate or stock OF said railroad companies either
ot the time stated or at any other tim" and derived
no pront or bencnt therefrom from the sale thereof
| further unequivocaly declare that at the time In
ro, did not have any interest whatever in the WIS.
coasn Central Railroad COMPANY The Wisconsin Central
Company. htN"h 'lhbA"p'
sworn and subscribed 10 before this l4,h day OF
August. 1898. j.. IL klDDf't'
Notary Public (oD. Nrw-Yora County.
Thomas F. Cakes and Henry c. Rouse, two OF
the receivers Of the Northern Pacific. filed bonds
Of $50 600 each the United States Circuit Court
Yesterday. The American Surety Company is their
surety. The course OF the Northern Pacific Sc
curities at the Stock Exchange was somewhat ir-
regular The common stock closed y per cent
lower at a.. and the preferred stock ended shade
better at IT. The consols IS fell l per cent TO
99o but the first mortgage bonds were shade
better one Wisconsin Central first mortgage bond
sold per cent higher at 81. but Chicago and North
prn Pacific frsts dropped per cent, to 40.