Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1901-07-26
SEVENTH NATIONAL BANK.
While Federal Grand Jury Investigates, Direc-
tors Decide TO Recognize.
w. II. ID. stokes, a Stakeholder,
Lodges a Complaint Against
Directorate.

New York, July 25.-With the federal
grand jury in session on the investiga-
ton of their affairs, the board Of d.
rectors Of the Seventh National bank
met today and decided upon a plan for
the reorganization of the defunct bank.
The capital stock is to be increased
from 100000 to s2,5OOOOO and the adj
ditlonal issue of 100000 in stock will
be sold at sl,SO per share, with first pur-
chase privilege TO the present stock
holders.
The cash proceeds OF the assessment
on the existing stock and the sale Of
new stock will, IL Is claimed, pay all
present obligations and completely re-
store solvency. Existing stockholders
are TO be required to pay the assess
rhent ordered by the comptroller Of
the currency. Edward h. Thomas, Ed
win Gould William Nelson Cromwell.
Frank Ray, William II. Taylor and
Edmund X. Stasle have been consti-
tuted committee Of subscribers with
plenary power to carry out the plan,
They are 10 receive subscriptions and
represent the stockholders In all mat
ters relating to the bank and receiver
ship. The present directors and OFF,
GERS are required TO tender their res
ignations and majority under the new
subscription VIII elect their successors
The plan Is made binding upon all
subscribers when per cent of the new
stock is subscribed and 90 per cent
OF the assessment Is paid.
A subscription form embodying the
main features Of plan OF reorganization
was also drawn up and approved A
substantial amount OF new stock has
already been subscribed
United States District Attorney Hen
ry l.. Burnett says the plan to reor-
ganiZe the Seventh National bank will
not affect the investigation by the fed
eral grand jury.
William f. d. Stokes, who Is stock
holder OF the Seventh National bank,
has taken out summons in the supreme
court against the directors of the bank,
President Thomas and Receiver Ray
nor. The complaint charged the d.
rectors with making reports to the
stockholders to the effect that the cap
ital Of the bank was unimpalred. when
as a matter Of fact.it was already in
solvent II further charges that the
directors utterly failed and neglected
to perform their official duties" that
they suffered and permitted the ao.
counts Of said bank TO be kept In an
inaccurate manner, which failed to
show the true character Of its affairs"
In the complaint the directors are
further charged with having employed
incompetent persons as officers Of the
bank. "who were unable 10 properly
and efficiently discharge their duties, |
all Of which was well known to the !
directors"
After having further charged them
with having given loans to insolvent |
persons and corporations, without ade- |
quate and valid securities. the COM |
plant goes on:
"That said directors defendants so
negligently and carelessly conducted |
the said bank and the business and az
fairs thereof and the entire capital |
and surplus and much of the property |
and effects thereof have been lost and |
stock OF the said bank rendered WORTH
less and the stockholders thereof rem
dered liable for large sum OF money |
on account OF the debts OF said bank |
unpaid"
The plaintiff then demanded judg-
ment for the total amount OF his loss
as a stakeholder OF the bank. and the
cost OF the suit.