New-York tribune., 1903-07-16
SAY HE MISUSED FUNDS.
Head of UniUersaL Tobacco Com
pany accused d-ReceiUer asked.
TBY TELEGRAPH TO THE rR1BUNE.l

by TELEGRAPH TO THE TRIBUNE.l
Trenton. n. J.. July 15.-In bill filed to-day
asking for the appointment Of d receiver for
the Universal Tobacco Company. the president.
William H. Butler is directly charged with
being party to a plan to wreck the company.
and with having msapplied its funds for his
own uses. The application was made before
Vice-C Chancellor Pitney, representing Edwin A.
McAlpin. of Ossining, n. Y; Edward c. Bah
cock and Charles NJ Allaire, of New-York City.
and William D. Judkns, of Pelham Manor N.
Y, and other stockholders. An order signed by
the ViCe-Chancellor enjoins a proposed bond
issue of $1O00O00 and requires the officers of
the company to show cause at Jersey City on
August why a receiver should not be ap-
pointed.
The Universal Tobacco Company was incor-
porated in April, 1901 with authorized stock of
100000, which was soon afterward increased to
$1OOO0000 The.companys books March 81
showed assets of 81, ,135O1O and liabilities of
$S62,745. The. complainants allege. however,
that assets of $532. 900 represent raw material
which would not bring over $275,OOO at forced
sale, and that the machinery which is valued
at S22IOOO, would not bring over $4,000 They
assert that President Butler and his brother
George P. Butler, in collusicn have by obtain
ing the issuing of a large amount of demand
notes to themselves put the corporation abso-
lutely within their power. These specific charges
are made against President Butler in the bill:
Although under contract to serve the company
as general manager and to devote his time and
efforts to the promotion of it's interests and
not to engage in the prosecution of the business
OF any other tobacco company, he has devoted
his time and efforts to very large extent in
promoting the interest of another corporation,
the Commonwealth Tobacco Company, in
which he and his brother, George P Butler have
a large financial interest about nine-tenths of
the stock standing in the name Of George P.
Butler.
He has mismanaged the Universe Tobacco
Company, in purchasing large amounts of ma
chinery from corporation known as the United
States Standard Machine Company in which he
and his brother have a large financial interest
the purchase of such machinery being useless
and unnecessary, and such machinery in large
part remaining unused.
He has wilfully and Intentionally sought to
waste and dispose of the assets of the company
for his own personal gain and that of his brother
and in particular, he has sought to sell large
amount of preferred stock held in the treasury
OF the company for the nominal sum Of So
share to his brother, and has sought to create a.
fictitious market for such stock in order to give
color to such transaction.
The bill charges that Butler has so nanipu-
lated the affairs of the company that he COM
pletely dominates the board of directors
For some time. the bill says, President Butler
had with him in the directorate men of ability
and financial responsibility, including George r.
Sheldon and Henry r. Wilson, of New-York;
Frank Tilford, of Park & Tilford, and Edward
A McAlpin. one of the complainants. The con-
duct of Mr.. Butler and his attitude toward
these directors, it is stated, caused them to re-
sign, while the president, by manipulation of
the voting trust. obtained the election of sue
cessors Of his own selection.
The complainants attack the voting trust. An
investigation of Buffers standing with the COM
pany and its Indebtedness to him are also
sought to be obtained through the appointment
of the receiver.