The Barre daily times. (Barre, Vt.) 1897-1959, 1908-02-14
Involving U. 5. Independent
Telephone Company
IS A $4,000, 900 CONCERN
It Is Said That There Are No Assets
and Bondholders Charge Illegal
Issue Of Stock-wher Largest
Share Went.

Newark, N, j., Feb. Following al
lc2atio rs made BY counsel for the plain
tin that the United States Independent
telephone company was a corporation
with S5O,OoO,O0O authorized stock and
entirely without assets to meet its
debts ana obligations, Vice Chancellor
Howell Of New Jersey has signed an or
der directing that concern to show cause
on Feb. IS why il should not be adiudg-
ed insolyent and receiver appointed
for it.
Application was made before Cice
Chancellor Howell in this city by John
X. Hardin for James NJ r. 0iGrady Of
Rochester, n. ", a creditor and stock
holder, being the owner OF I12 shares
of stock at the par value Of 500 each
and Of twenty-eight bonds Of the COM
pany Of the par value Of $1,000 each.
The company is described Ia the bill as
q holding concern
The complaint charges the truth to be
that the company has been insolyent
since its Incorporation and that at q
meeting of directors held ia September,
1906. il was announced that the com.
rany was financially embarrassed and
unable to meet it, obligations. The III
rectors, to avert the pending insolvency
and for the purpose OF meeting the cur
rent and floating indebtedness Of its
subsidiary companies, pledged all avail
able cash assets of the United States In
dependent telephone company and its al.
lied concerns to the Rochester Trust &
safe Deposit company TO secure an issue
of S2,5O0,000 Of notes. The notes, the
bill alleges, were sold largely to the
comp1ny's directors at ninety cents on
the dollar
The company began business in Aug.
asst. 1906. 1T 1915 University avenue,
Rochester. At present the company has
no president, It's first vice president BE-
ing John y. Rouhers and its secretary
and treasurer NJ. Roy McCanne, both
81 Rochester. Adolph Busch 81 81. Louis
heads a iirt Of twenty-fom directors
The bill alleges that Of tine $4,000
900 capital stock there has been issued
si2,576.000 Tor the most part to pro-
nioters, organizers and directors OF the
company, without any consideration.
and Tor property at gross overvaluations
Ii also states that such issue Of stock
has been fraudulent and Illegal under
the laws Of New Jersey, and that the
parties who received the same are liable
to the creditors Of the company for such
amounts as are unpaid On their stock.
II Is further alleged that the only as
sets OF property Of any kind owned by
the company are 4.7si shares, par value
500 each, Of the Rochester telephone
company, Incorporated III New Jersey;
d0,742 shares common stock, par value
500, and i3,2O5 shares preferred stock,
par value 500, Of tile Stromberg arl.
S9H telephone manufacturing company.
and 100000 shares. par at 500, Of the
New York Independent telephone GEM
Tany. a corporation Of New York,
(which has not since its Incorporation
exercised its corporate functions
In addition to the foregoing the Unit
ed States independent telephone com
pany owned certain accounts and bills
payable TO the Stromberg- Carlson COM
pany, and other subsidiary concerns
By Il, which accounts and I
bills were pledged BY the defendant
concern to the Rochester Trust a Safe
Deposit company 10 secure an issue Of /
collateral trust notes for $4,000 /
The bill states that up to the present /
only SO per cent OF tho principal Of the /
notes had been paid, and That the bal
auec Of accounts ana bills receivable I
pleaded to secure the collateral trust I
eof "a a ra mar NORTH more Than fhp hal. 4
3ace to be paid on the notes.