The Providence news. (Providence [R.I.]) 1891-1906, 1894-09-26
WOOD PAPER.
Large Meeting of Principal
Stockholders of Company.

The meeting OF the stockholders OF the
American Wood Paper Company, which
occurred yesterday noon at the ofhce OF
the company on Canal street, was attended
by some OF the largest and most infiuen-
tial stockholders. AS the meeting was OF
private nature the directors thought
best not To give the details OF the discus
sion TO the public.
The following notice, however, recently
ssn out, gives the purpose Ct the meet
ing in brief:
Providence, Sept. Is. 1894
From reliable Information the Board OF
Directors OF the American Wood Paper 90
believe that certain parties propose 20 sci up
the claim that the stockholders OF the Com
pany are personally liable for it's debts. You
are therefore requested % attend meeting OF
the stockholders TO be held at No. % Canal
street, on Tuesday, Sept. %, at IL o'clock M.
10 determine what action shall be taken IN
the matter,
Per order of the Board OF Directors,
CHARLES FELIX MASON, President
The question was somewhat fully con-
sidered and IL was decided that a fund
should be raised TO protect the interests of
the company and the stockholders inGi-
vidually and that every point involved in
any legal controversy which might arise
should be contested vigorously and that
the best legal talent should be secured for
that purpose.
AS a matter of fact, suits thus far have
only been brought against the American
Wood Paper Co. as q company and not
against any stockholder individually.
These suits have been brought, as is
shown in the court records, by John ID.
Wing and Wing q Evans, of New York
and by some banks in this city, which
hold the notes OF the company with the
bonds as collateral. The banks are the
Merchants National, the American Ma
tional, the Commercial National, the Ma
tional Bank of Commerce, the Mechanics
National and the Rhode Island National.
The banks have brought suit not only on
the notes, but on the bonds held as col
lateral.
Their Claim.
1t is currently rumored in financial
circles that the case of the banks is based
upon their claim that the company has
not made proper reports of its condition
to the State, or that If it has recently
made reports 1t did not DO so for long
period OF years previous to 1891, and that
during that period the obligations, upon
which suit is brought, were incurred.
THE NEWS learns of stockholders that the
company could not make returns by law
previous to 1891, because the law govern
ing returns applies only to corporations
having their manufacturing plants within
this State, while the property of the Amer
ican Wood Paper Company was entirely
within the State of Pennsylvania, at
Spring City and Mannayunk. In
1891 special enabling act was
passed allowing the American
Wood Paper Company, to make returns
in this State and two reports were rem
dered under that act-one in 1891 and one
in 1892. These returns were made under
the direction of William w. Douglas, now
Judge Douglas, and it is believed by the
stockholders, or at least some OF them, that
those returns will exempt them from all
liability.
There is a second point in the claim OF
the banks, which will be stubbornly con-
tested. They will claim that they dis
counted the notes, originally, with the
distinct understanding that no returns
had been made, and that, therefore, the
stockholders were all personally
liable. Liability on the notes, there
fore, continues to remain with the
stockholders and could not be invslidated
by any subsequent report, particularly as
tuaJ report cOulu not leBhlly nave Deen
made until after special piece OF legisla-
tion had been passed by the General As
sembly permitting it.
THE NEWS leaves the further discussion
OF these points to the stockholders and
those interested. They are nice points and
will undoubtedly involve long legal
struggle.
When the assignment was made on De-
cembcr IL, 1892, the company had 81 ,000,-
600 capital stock, S270,0O0 OF bonded in
debtedness, about S135,0O0 of unsecured
liabilities and $685. 900 Of notes outstand-
ing, but secured by bonds as collateral.
The total Indebtedness, therefore, ap-
peared to be about S5OO,0O0, which would
be equal TO an assessment OF 90 cents on
the dollar for the par value of the stock OF
each stockholder.
Since that assignment there have been
numerous attempts made to reorganize
the company and the bondhoders have
paid an assessment of per cent. to keep
the plant in condition and for expenses OF
the assignee. All plans have failed how
ever, and on July 27 OF this year the plants
at Spring City and Mannayunk were sold
under foreclosure proceedings for s51 900,
(the original cost was over sl,000O OO0).
The purchasers were a company composed
OF bondholders named the Schuylkill