The San Francisco call., 1896-01-17

bSSAi tAetb AJhiiOA AdS Deeu USSlCOuS
of making change in the managership Of
the road.
The complaint which was filed today is
volumlnous typewriter statement COM
piled by Attorneys James Lilenthal and
Goodfellow. In substance it alleges as fol-
lows:
THAT A. W. Foster, II. H. Markham.
A. P. Overton, /. G. Wickersham, J. NJ.
Mcdonald, t. A. Newhall and j. F.
Fugazi, plaintiffs VS.. Sidney Y. Smith
and the San Francisco and North Pacific
Coast Railway Company, a corporation,
defendants. the plaintiffs pray that de-
fendants be restrained from casting anv
votes at the annual meeting on January
u, 1896, or any adjourned meeting thereof
upon any part of the 42, 900 shares of stock
purchased from the Donahue estate, ex-
cept as determined by a certain bolIot held
in favor of Foster. Markham, Newhall and
2. n. Lilienthal, as such directors,
and that said Smith be commanded
by mandatory injunction of this court
to cast his vote at said annual meeting
upon the shares registered upon the books
of said company in his name and repre-
sent his interest in said $4,000 shares by
favoring said directors in accordance
with said ballot, and that said de-
PENDANTS. their attorneys, officers, direc-
tors, employers, agents and all other
persons connected Herewith be restrained
by order of court from receiving the vote
of said Smith. The complaint further al
leges that the capital stock ofs the road is
50 900 shares that the North Pacific Coast
Railroad operates a line and is a com
81 tho mo
traffic.
THAT the San Francisco and North Pa
cific Coast Railway Company is, and for a
long time has been, earning a large sur
plus over all its operating expenses and
fixed charges relative to its sinking fund
and bonded Indebtedness and is in
a good financial condition. That upon
information and belief the North Paci-
tic Coast Railroad never earned its
fixed charges. That said railroad extends
from Sausalito to CaZadero. That from
Anselmo it runs through a country whose
contribution depends chiefly upon forest
products, that the greater portion of its
revenue is derived from stumpage and for
est products from tract of 800 acres owned
by said road and that all the lumber now
is nearly cut from said land and that such
is now not sufficient to pay operating ex-
penses north OF San Anselmo, and it's
principal earnings will depend upon a line
between San Francisco and San Rafael
THAT its bridges are so Old and rotten
that they must soon be renewed at a great
expense. That the estate OF James NJ
Donahue had 4200 shares OF stock to sell.
That on the oath day of February, 1898,
S. V. Smith desirous of forming a syndi-
cate for the purchase of said stock,
solicited and requested the plaintiffs
and one Hitchcock, recently deceased, to
join with him in the purchase of said
stock That in order to induce said
plaintiff to purchase said shares Smith
represented and promised that upon the
said shares being acquired provision would
be made by agreement whereby said
AZ 900 shares should at all times
during the five years thereafter be
voted as q unit in the elections of directors
OF said railroad company, and that the
management OF said corporation would for
the said term of five years be controlled
by saia Smith and his associates, and the
said railroad be operated prudently and
economically. II was upon this represen-
tation that plaintiffs became shareholders,
that said Smith paid SO much for said
road"
1t then alleges that Smith prepared the
agreement and had them sign it. 1t then
sets forth the agreement, which in sub
stance states that the stock shall be kept
registered in the office of the company,
and shall prevent the stock from getting
into the hands of any other corporation,
and that said 42, 900 shares shall be cast in
a whole or block.
1t states that the North Pacific Coast
Railroad acquired $4,000 shares of stock !;
that s. V. Smith is the attorney for the
principal stockholders of the road and
that the shares were acquired by the rail-
road with full knowledge of Smith; that
Smith now denies validity of said contract
and desires to vote his shares with the
the intention of Smith and proposed by
him to procure the election of J..
L. Howard as president and manager
of the consolidated roads and that
| Howard has no interest in said
roads; that if Smith carries out his threat
it will change the interest in favor of the
North Pacific Coast Railroad and against
the interest of the San Francisco and
North Pacific Coast Railroad and in viola
tion of the agreement made February IA,
1898; that Smith will be unable to respond
financially to these plaintiffs for damages
by breach of agreement and plaintiffs will
be irreparably injured
It also quotes letter written by Smith
to plaintiffs, ignoring the agreement and
stating that he will vote his shares as he
sees fit. 1t further states that the North
Pacific Coast Railroad made proposition
inviting the San Francisco and North Pa
cific Coast Railway Company to consolI-
date, which was refused by said stock
holders and accepted by Smith.
Smith has transferred some of his stock
to Howard, for the purpose of qualifying
Howard to be a director of the proposed
ombine.
S. V. Smith, when seen to-day regarding
the matter, stated that he would give his
side of the story in court. The greatest
interest is manifested in regard to the
outcome of the case. The preliminary
hearing is set for next Saturday.
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