New-York tribune., 1901-12-31


man people or the Hill Morgan interests.
The restraining power will not only be served
on the oIhclalS IN minnesota. out VIII oe teie-
graphed TO New-York and served on the officials
there,
PROVISIONS OF INJUNCTION
The injunction restrains the Northern Pacific
Railway Company from issuing selling any
debenture bonds or other evidence Of indebted
ness, or creating any Indebtedness liability of
any description for the purpose OF raising money
with which to pay retire the preferred stock
Of the Northern Pacific Railway Company. or
from using or appropriating any moneys or
proceeds, other than the ordinary surplus net
earnings Of the company the retirement of
the preferred stock of said company; also from
creating any liability other than the ordinary
liability for the operating expenses of its rail
road system. and the Indebtedness now existing.
which would take precedence Of the common
stock Of said company, also from placing its
property in the possession or under the control
Of the Northern Securities Company. or from
entering into any arrangement through the
medium Of the Northern Securities Company, or
otherwise with the Great Northern Railroad
Company the Chicago Burlington and Quincy
Railroad Company. either of them. for the
purpose Of causing the Northern Pacific sys
tenn to be operated in connection with or by
the same authority as, the cher two roads; or
from entering into any agreement with said
companies. either Of them for the purpose Of
avoiding competition and fixing ia tes.
The petition recites briefly the history OF the
Northern Pacific Railroad and the division of its
stock into common and preferred. It Is alleged
that the only difference between the preferred
stock and the common stock that the pre-
ferred stock was entitled TO the per- cent divi-
dend prior 70 anything being paid on the
mon stock and the bin in this connection al
Teges that the preferred stock subject 10 he
retired at any time within twenty years after
the reorganization Of the company. and that in
other respects the rights of the preferred and
common stock holders were identical
The bill alleges that the Northern Pacific
Railway Company and the Great Northern Rail
way Company are parallel lines to the Pacific
ocean, and that the Chicago, Burlington and
Quincy has a parallel line from Billings, Mont.
TO Chicago. and that all such lines are COM
peting for the business Of the Northwest.
WHY NEW COMPANY WAS FORMED.
II is alleged that the officers Of the Northern
Pacific Railway Company in the last summer
went into a combination with the Great North
EN- and the Chicago. Burlington and Quincy. the
purpose of which was 10 consolidate the three
systems under one mana cement, and, knowing
that it could not be legally effected the d-
rectors of the three companies. for the purpose
OF doing indirectly what they could not do di-
recty caused TO be organized the Northern
Securities Company. a NeW-Jerssy corporation.
with a capita Iizatiou Of S4o.OD.GO. which was
authorized 10 hold the securities Of other cor
pora tions the intention being to cause a ma
jority Of the stock of all three OF the railway
companies to he transferred to the Northern
Securities Company, thereby suppresSng COM
petition. regulating the tariff rates and con
ducting the entire business Of the three systems
a corporation, that the SCheme was III
violation Of the law of this State and OF other
states through which the railway lines pass. and
against the laws Of the United States.
HOW PREFERRED STOCKS CAN BE RE-
TIRED.
The bill also alleges that. under the charter
OF the Northern Pacific Railway Company. and
under the provisions OF the reorganization
agreement. the preferred stock can be paid for
and retired only out OF the net surplus earnings
Of the company. and not otherwise, that not
withstanding these provisions. the directors of
the company. the first step in transferring
the control OF the road to the Northern Securi-
ties Company have served notice upon the hold
ers of the preferred stock that January |.
1902 they will retire such preferred stock; that
the plaintiff says that no meeting of the share
holders Of the defendant company has been
called to make the issue of the certificates of
Indebtedness dehenture bonds; that the
board Of directors is without power To issue
such certificates. is the company: that at the
the Common stockholders in 1S!BS, and by the re-
organization agreements it was provided that
the company should not put a mortgage upon
the property of the Northern Pacific system,
nor should the amount Of the preferred stock he
increased, except by consent Of the majority
Of the holders of the whole amount Of the pre-
ferred stock and the consent of the holders OF
the ma jority of common stock TO be voted sep
aratey that il is proposed to substitute for the
present preferred stock which in no way consti-
tutes a lien upnI, the property of the Northern
Pa acitic Company. and is not a charge against
the earnings of the company. and has prior
right over the common stock. except in priority
of dividends, z convertible negotiable security |
bearing interest at the rate Of per cent per
annum. which interest is TO be fixed charge
against the earnings of the company and its
property and must be paid. whether the earn
ingS for any year amount 10 / per cent upon
sa id issue Of convertible certificates or not and
under which. if default shall be made in the |
payment of said interest, the entire property of |