Tonopah daily bonanza. [volume] (Tonopah, Nev.) 1906-1929, 1917-04-12


-. Manhattan Consolidated Mines
n.vslopment company and the White
cans Mining company was settled
l,te Yesterday afternoon, as mention
"A in the Bonanza Of last night The
,.,,lament was brought about by the
,.ynent Of $4,000. and representa-
lives Of both companies expressed
great pleasure at the satisfactory
,o,mnatlon OF what threatened to be
.rnte litigation and what might have
,eeeted future development in the
Manhattan district.
The contention originated through
loan made to the Manhattan Gold
Mines company, an Arizona corpora.
ton which was secured by preferred
stock The issue was 10000 shares
o which the present Nevada cor
oOration OF the Manhattan Con. holds
iO0OOO shares The White Caps
company during the summer OF 1916,
came into possession of 44,226 shares
Of the remaining issue The loan
vas secured by deed of trust which
stipulated that foreclosure could only
be instituted upon the written APP
plIcation Of the holders OF majority
Of The stock. The consolidated com
pany contsnded that application of
ceedlngs was illegal on the ground
that the application did not repre-,
sent a majority of the outstanding
stock Nevertheless the Manhattan
Con. was very anxious to retire It's
preferred issue and for some time
has been financially prepared TO do
80, The White Caps company, how
ever, contended that the preferred
stock, instead OF drawing preferential
dividends, drew eight per cent in
lerest from the date OF issuance as
was authorized by the articles OF
Incorporation Before the preferred
stock was issued the Manhattan Con-
aseertalned that preferred stocks
never draw interest, but preferential
dividends instead, and that the
preferential stock. when issued,
vas issued according to uni
Iersal custom. II the stock had
irawn interest the White Caps com
mny would have been entitled to
nnethlng like $4,000. but the Con.
Slidated company contended that the
stock drew no interest and that
ne preferential dividend could only
be paid out Of the net earnings OF
the corporation and. as no net earn
nEs had been made, the company
was obligated for nothing but the
par value of the stock.
On this assumption the Manhattan
Con. was about to make a tender
in gold coin and start suit in the u,
5. court to compel delivery OF the
stock and to enjoin the White Caps
company from continuing its action
IN foreclosure. At this time the
White Caps company came to the
Manhattan Con. with proposition
that before the controversy be car
ned further that compromise be
made Both companies realized that
the litigation and uncertainties was
proving serious handicap to the
development of the entire Manhat
tan district. Accordingly after severa
propositions and counter propositions
wee considered the White Caps com
pany conceded that no dividends ha'
been earned by the company an'
they we're entitled to neither diyid
ends nor interest until after matuI
ity Of their stock. Then the Man
haitian Con. conceded the legal rat
Of seven per cent from date of ms
turity to the present time, which, tt
gether with the expenses OF tn
trusteeship. aggregated approximate
" $4,000. In other words the "a
22S shares held by the White Car
company we're surrendered and a
claim for interest, costs and tru
teeship, etc, fully satisfied for
cash payment OF $4,000.
On reaching this determinatic
Secretary Boak of the Manhatta
Con. drew the company's vouch
and rendered 1t to Arthur G. Ra
craft, vice-president Of the Viii
Caps company and cashier of q
Nevada First National Bank as trr
Tee, accepted the couvher and dell
cred the stock will full satisfaetio
This removes the last cloud fro
the title Of the Manhattan Con a
the effect on the market this mol
ing was electric, the stock sho
ing up to as from yesterdays clio
at ss and yesterday mornings
sning Of 90. The Manhattan G