The evening times. [volume] (Washington, D.C.) 1895-1902, 1901-01-04
B. & D. RAILROAD SUED
Delaware Stakeholder Wants d Re
StFaiHing Order.
Holder of Preferred shares Asks for
Pro Rata Dividends and Seeks I"
Enjoin the Company From Making
the March Payments = No Or
der Yet Passed by the court.

/ BALTIMORE, jar Henry ?. Scott,
OF Wilmington. Del. instituted suit II the
/ Circuit Court yesterday 20 restrain the
/ Baltimore and Ohio Railroad Company
/ from paying a dividend Of > per cent On
its common stock on March l until there
( has been declared on the preferred stock
dividend which shall be a Droportionate
part OF all the net earnings for The year
ended June 80, 1900, appropriated 70 divi-
dends IN excess Of per cent On the pre-
ferred stock. Mr. Scott, who holds 1900
shares Of the preferred stock, is repre-
scented IL the suit " attorney John y
Steele.
The bill Of complaint states that II 1893
the Baltimore and Ohio Railroad Company
issued 600,0eO shares OF preferred stock
and $4,000 shares Of common stock. eaeb
of the par value Of S1GG a share. The pre-
1erred and common stock was issued in
accordance with the plan Of reorganiza-
tion Of the railroad, 4 copy OF which is
fled with the bill Of complaint.
II was provided in the reorganization
plan that a dividend Q. I per cent year
should be paid on the preferred stock be
fore the payment OF any dividend on the
common stock. On February ,, 1909, a
QlNllSLC u : per cent d +ieE4G~- ttt t--
preferred stock for the SIX months ended
December 81 1888. and on August > 1860,
another dividend Of = per cent was deClar-
ed for the six months ended June 80, 1860.
On August , 1899, 3 dividend OF I per
cent on the common stock was declared
out OF the ret earnings for the year ended
July 80, 1900. Two per cent OF this diyi-
dend was payable September /. 1900 and
per cent en- March / 1901 The = per
cent was paid September L and II IS stat
ed in the bill OF complaint that the re-
naming , per cent viii be paid on the LIST
OF ne.- SStt5=Sh unless the court inteTieres-
The bill OF complaint states that the
railroad company takes the position that
the holders Of the preferred stock are not
entitled &c receive in any one year
greater dividend than 4 per cent, and are
only entitled to receive such dividend IN
q year IN which in the opinion OF The d
roctors. the ret earnings may Justify the
declaration OF d dividend 10 that amount.
The railroad company also holds, II Is stat
ed. that the holders Of the common stock
are entitled each year, after the payment
Of d dividend OF ! per cent on the prefer
red stock, 70 receive out Of the net earn
ings whatever dividends the directors may
declare.
Mr.. Scott charges that II is ths iutcu-
lion Of the directors not only 20 pay The
remaining dividend Of : per cent on the
common stock CE March i but also - pay
such dividends upon the common stock
out OF the net earnings Of the next fiscal
year as the directors shall deem the net
earnings TO justify. This i Is alleged. IS
to be done even II he dividends on the
common stock shall he in excess Of 1 per
cent q year. Unless restrained by an in
Junction. 1t is also alleged, The railroad
company xilI pay out of the net earnings
for the fiscal year ending June SO 1901 q
dividend Of only per cent o. the prefer
red stock and q dividend "a excess Of 4
per cent on the common stock II the di-
rectors deem IT justified by the net earn
ingS-
Il IS claimed that ne holders OF the
preferred stock are not only entitled to
q dividend Of 4 per cent a year. but are
also entitled TO share pro rata with the
holders of the common stock in any adli-
-i0nal dividends which may be declared
out or the net earnings.
An injunction is asked restraining the
declaration of any dividend on the com
mon stock out OF any future net earnings