The Montgomery advertiser., 1901-12-31
INJUNCTION SECURED
NORTHERN PACIFIC CAN'T RE-
 TIRE STOCK.
President Mellen Served With Papers Restraining Him from Retiring $75, ,oo0, 900 of Preferred
 Stock.

St. Paul, Minn., Dec. So-Just after the noon hour today, President Charles s, I.ielIen of the Northern Pacific Railroad Company was served with papers which enjoin the company from retiring the pre- ferred stock.
 The injunction enjoins the Northern Pacific Company from placing the man. agement of its railway system in the pos session or control of the Northern Sscuri- ties Company; or from entering into any arrangement through the medium of the Northern Securities Company. or other wise, with the Great Northern Railroad. or the Chicago. Burlington and Quincy Railway Company. for the purpose of causing the Northern Pacific Railroad to be operated in connection with or under the same rules. or by the same authority as the Great Northern Railway Company and the Chicago. Burlington and Quincy Railway, or from entering into any agree ment with said companies, or either of them, for the purpose of avoiding com petition and fixing rates.
 The bill alleges that the Northern Pacific Railway Company and the Great Northern Railway Company are parallel lines to the Pacific Ocean and that the Chicago, Burlington and Quincy Railroad Company has a parallel line from Bill
 
 such lines are competing lines for the bushes of the Northwest It is alleged that the officers of the Northern Pacific Railway Company combined with the Great Northern and the Chicago. Bur lington and Quincy to consolidate the three systems under one management. and knowing that it could not be legally effected, the directors of the three com panies caused to be organized the North AsAs. An.A ar.t~ 1Ax.I IaN ing to caues a majority of the stock of all three railway companies to be trans ferred to the Northern Securities Com- pany, thereby controlling the three sys- tems of railways through the medium of the securities company, suppressing com petition. regulating the tariff rates and conducting the entire business of the three systems as one corporation.
 That thereupon, the Northern Securi- terms of exchange all the stock of tho Gteat Northern Company. That the whole scheme was illegal, in violation of the laws of the State and the other States through which the railway lines pass. against public laws of the United States and each of the States. The bill also alleges that under and by virtue of the charter of the Northern Pacific Rail- of the reorganization agreement the pre- ferred stock can only be paid for and retired out of the net surplus earnings of the Northern Pacific Railroad Com pany; that, notwithstanding, the direct ors. as the first step in carrying out their plan of transferring to control of the defendant corporation to the North ern Securities Company, have served no- tice that on January 1, 1902 they would retire the preferred stock.
 The bill alleges that the Northern Pa cific Railway Company has not on hand exceeding 5000, 900 derived from the earn lngs of the road wherewith to pay the that in order to retire such preferred stock, tle directors are threatening to sell certificates of indebtedness or de- bentur0 bonds amounting to $76 000, 900 of the Northern Pacific to pay off the stockholders of the preferred stock al par.
 That is proposed to substitute for tho present preferred stock, which has nc prior right over the common stock, ex' cept in priority of dividends. a converti ble negotiable security or debenturs bond, bearing 4 per cent interest, which amount is a fixed charge against the earnings of the company and its proper. ty. and must be paid whether the earn. ings for any year amount to 4 Der cent upon said issue or not, and under which if default is made in the payment of said Northern Pacific Railway Company may be sold to satisfy judgments which may be obtained thereunder and all equities and rights of the common stockholders extinguished. fsiaNMM
 The bill sets forth that the scheme has already provoked litigation and claims more will follow. The bill then prays for the writ of injunction. which was issua1 by Judge Elliott.