New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-06-30
NOT TO BE DISSOLVED
Report Adverse to Request of Large
Body of Shareholders.

A report adverse to the request Of a large body
OF shareholders OF the New-York, Ontario ana
Western Railway Company for the dissolution OF
the voting trust was submitted yesterday 10 the
Board of Directors by subcommittee appointed
on May I. inquire into the subject. The mem
aoers Of the subcommittee, in their report, quote
at length from opinion given them by their
counsel William p. Iiorrblower. The right OF the
sreferrec stockholders 70 elect eight directors, Mr.
Eornblower says. is quite distinct from and rests
on an entirely distinct basis from the voting trust
81 rests the articles Of association OF the COM
psny, dated January p, 1880. by Article Sixth OF
which Il is provided:
That the corporation is 10 be managed by thir-
teen directors Of whom the preferred stockhold-
s-s are elect eight and the common stockholders
Eve, until such time the company shall have
earned and paid a dividend upon the common stock:
upon the happening OF which event the directors
shall be elected b. a majority OF po:h classes Vot-
Ing az any election
saThis provision of the articles of association"
counsel says. creates contract obligation as be-
tween the two classes OF stockholders" On the
other hand, the so-called voting trust arises
under an act OF the Legislature passed in 1885,
rsversI years after the organization Of the com
pany.
EFFECT OBJ DECLARATION OF A DIVIDEND.
Continuing. Mr.. Hornblower says:
Tia declaration OF a dividend upon the common
svoting trust, such under this statute The eff
Feet OF the declaration OF a dividend would De,
however, 10 take away the right of the voting
20 eight Of the thirteen directors the right Of
abe voting trust 10 represent the preferred
Of the opinion that the declaration OF merely
nominal dividend 10 the common stocknolaers w0ui1
the articles of association to take away the right
Of the preferred share holders to elect eigh5 OF me
question that ii viii be necessary for the proteo-
sion Of The company and Of The interests OF the
holders Of the common stock. to continue me
company shall have earned and paid dividend on
fhe common stock. There are other purposes 10 be
lion OF the right OF preferred share holders TO
elect eight Of The directors It Is Necessary Tor the
stock holders, that sc long there is any pre-
be Eept alive in order that the sman minority of
Outstanding preferred stock should not be able to
exercise, interests. the very important
powers conferred by charter upon the preferred
should be exercised by the trustees IN the interests
OF and for the benefit OF the corporation whole
second Question Can the trust be dissolved be-
fore al the preferred stook shall have been trans,
cannot so long there is any preferred stock
fheTeof and not hed in trust for the Company it.
self The legislature has itself created the trust
dition, on whicn It shall terminate, viz when
eli such preferred stock shall have been so trans
The subcommittee after presenting Nj Horn
blowers views adds:
TT9m the fqTegotng the conclusion seems ire;
We report
In closing the sub committee says:
We report that no dividend should be or can be
fhe building of the second track must be continued
and carried 10 completion speedily as the work
the proper dine. some plan be submitted to the
eGIa To- bo ter We n ne" bb Supple So PIE
. VIDE for the further of that work and other
capital Any such plan Should be compTehensve
SoTgn Io' eII{ 10 meet ORDINARY tTaInf ana I'M
OF years. but to enable the company TO avail itself
operations If the socihoiders Shall approve su it
plan when submitted 10 them the division Of
Tor disposition by the board -
COMMENT OF J. B CLEws
James B. Clews, chairman of the stockholders
committee. IN commenting the sub-committee's
report said
directors Of the Ontario and Western would readily
comply with the stockholders wishes in dssolying
control the properly Tor hneteeR years BESIDE
Tor S mi se sI9cE@oqeTs be permitted TO vote
legal guardians who are anxious and willing 10
must be remembered thai forty shares Of preferred
slock sun remain out therefore. the trustees
continue the guardianship whether they ike ii or
not To 5e sure, most Of these outstanding shares
are so held that they could readily controlled if
s e ealFte Eo2ia qo46t.es3 grant petition OF the
Eppacatlon Tere made to thea on the ground that
purposes carried ont years II he ae
no. 50 serious il wood really be ludicrous-the idea
- esteTn can be controlled year after year by five
sile' 4eBaIlltsS oi the stockholders wishes simply
because q feEN shares Of stock insignificant in NUM-
Per: nave fot been exchanged FOR bonds under the
1esls's1lNe terms offered. ana when. as before
eleIed most Of sle shares easily otta
TIE tr-5' -es As Tor dissoIsiGg the trust by the
EaFtlett ol 4 salal dividend everybody of course
Knows thai such course IS open TO the hoard of
otectSrs. ana has been for a number of wears.
ana furthermore. that The earnings OF the com
!s3y nave 1a@n sufficient warrant such action
when the peculiar cUme1ances of me t1,at;5,
are aiken t--4 consideration The sfoaI-
AeIeetr have 10 desire enter into a c0ntroyersy
% as klf-a Dut The action Of The directors leaves
40 A-'l'lalhe Dut 70 test The matter the courts
eil1 ne committees counsel. Messrs Butler Not
man Jol Ne & NEnderse. VIII now proceed with tie
h-'~I VIII" '-+e