Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-12-27
AFTER HILL SYSTEM
MINNESOTA SEEKS TO CHECK
$50, ZOO, 900 STOCK INCREASE.
Permanent Injunction is Asked and
State Surveillance De-
manded.

ST. PAUL, Mimi, December 27.-Attor-
ney General Young and R. A. Stone, as
sistant attorney general, have commenced
action in the Ramsey county district court
on behalf of the state of Minnesota against
the Great Northern Railway Company,
asking for permanent injunction against
the company, its officers, agents and ser
wants from proceeding in any manner with
the proposed issue of capital stock recent
ly authorized by the directors in New York.
The Attorney General also asks that the
order restrain the defendants from receiv-
ing collecting the amounts due on any
subscriptions which may have been or which
will hereafter be made, or from taking any
action to carry out these plans until the
Great Northern company shall first have
made application in writing to the railroad
and warehouse commission of Minnesota
and procured the commissions consent to
the issue of stock. temporary injunction
is also asked.
Increased It's Capital.
The Attorney General in his bill of COM
plant. after reciting that the Great North
ern is a corporation of the state of Min
nesota and that the company's original
authorized capital stock is $50 900, that
being the limit fixed by the company's
charter, says that between February 1,
$780, and March 1. 1896, the defendant
made several large increases of capital
stock until March 1, 1896 the total aggre
eating substantially '$15O,O00,0O0; that all
of the increases were made without apply
ing to and obtaining the consent of the
railroad and warehouse commission of Min
nesota as required by law; that prior to
December II, 1906, the defendant deter
mined TO increase the capital stock to
$40, 100000 by an additional issue of $780,
100000, notice of which served on the
stockholders by President J. ]. Hill, who
invited all to subscribe to a pro rata share;
that the officers are now preparing to sell
and issue this stock to stockholders of rec
ord January a. 1907. Continuing the petit
ton says that all necessary arrangements
for the issue and sale of the stock had been
made.
1.-The defendant has been and is now
paying annual dividends at the rate Of
per cent on all of its capital stock, and
Will pay dividends at the same rate all
OF its present capital stock If this increase
is contaminated; that this increase of $780,
0O0,GOo will therefore increase the fixed
annual charges of the defendant by the
sum of S4,2oo,OOO, great portion of which
will have to be paid by the defendants
Minnesota patrons charges on freight
and passenger traffic local to Minnesota,
and that it is further alleged that if these
plans are consummated they will be eff
fected without the surveillance or consent
of the state Of Minnesota"
Facts Are Wanted.
The bill sets forth that if the defendants
should make due application in writing to
the railroad and warehouse commission
and set forth the amounts and purposes
of said increase of it's capital stock hear
Ing could be had on the application to de-
termine its necessity, and the state could
therefore exercise surveillance and control,
amounting to prohibition if the stock issue
should prove to be unwarranted
Service was had officials of the Great
Northern yesterday afternoon
Attorney General Young says:
1t has become my duty to test the law
on this subject and if possible prevent the
proposed enormous increase until the law
has been complied with. The action is
simple one and seeks for injunction to
prevent the proposed stock issue until the
company has shown the necessity for the
Increase in its capital stock and has pro-
cured the consent of the railroad and ware
house commission after a public hearing"