Norwich bulletin., 1917-10-25

New Haven, CCnn., Oct. 24-Author-
 ity to issue preferred stock was given
 the directors of the New York, New
 Haven and Hartford Railroad com
 pany by the stockholders in special meeting this afternoon. The issue pro
 posed would take up floating indepted-
 ness now represented by notes to the amount of $45,C00,000, collateral for
 which to the amount of $96,512,510
 book value has been pledged. The re-
 suit was forecast by the fact that at
 the annual meeting held earlier, at
 which the directorate was reelected
 by an average vote of about 1.215, 767, 1t was announced that the tellers had proxies representing 1,169,277 shares.
 Both meetings were protracted and
 The ballot for authorizing he pre- ferred stock issue was 202,83 With 6 565 against the prouosal.
 frequently were lively, the debate in the annual one being more general monious nature, while at the special meeting there was more attention given to the financial condition of the company than the physical shape of the porperty. .'
 Objections Formally Made.
 Objections to action on the preferred stock issue were formally made by
 Mir Nixon, representing >S.-~S-4-AEeyeFs of New York city, and Mir. Berenson, chairman of a minority stockholders protective committee. The main ground of objection was that stock holders had not been properly warned Of the details of the proposed issue. The meeting had before it propoEals to accept charter amendments granted by legislatures of Massachusetts, Rhode Island and Connecticut under would have the right to issue preferred stock subject to approval of stock holders. The charter amendments were accepted 1908. .463 to 434.
 r. ify a vote of the directors on this sub- ject.. A copy of the vote, which was Of considerable length. being distrib- uted, at once gave rise to protests. It was seen that stock was to be issued at par and redeemed at no, and the other details coincided with the act passed by the Connecticut legislature. MT. Nixon charEed that. the same pol icy had been followed in calling the special meeting as had prevailed in other meetings in that stockholders got little information of the matters they were to act upon. He said the char ter amendments were vital ones. that the directors may not have had au- thority to go to the legislature to get them. that legislatures had not the right to grant them under the con- stitution, that the amendments might violate the right of contract. and that there might be deprivation of property without due process of law. On these points MT. Nixon spoke at length.
 Stockholders Properly Warned.
 MT Berenson got a ruling from President Pearson that stockholders had been properly warned and, after having objections noted, pleaded for | delay of action. He referred to the | mittee against former directors to re- cover money alleged to have been diverted. which suit is pend | ing in New York civ Mr Forenoon | o;v 0f al fny I, NIai, 1 ward Milligan, director. objected to | MT. Berenson being in this matter as immaterial' President Pearson per mitted MT. Berenson to proceed and | the latter then declared that stock holders in issuing the preferred stock would sell the equity in the road for ] s45, GOO, 900. He said the directors knew they were selling this equity at mon ey lenders terms because stockholders would be unable to pay the preferred | shares" He appealed to those present lot to vote for the issue. MT. Berrn- son put a question to F. G. Bucl1land, chief counsel of the road to which the alter replied that. the issue had not ITS and there had not been an effort made to do so. As to renewal of the ,otes, MT. Buckland said it was too ;arly to take up that matter.
 Resolution to Raise Committee.
 MT. Amster of New Y York had offered 1t the regular meeting a resolution to aise a committee of seven ot invesIi- ;ate the affairs of the company and to eport within sixty days it's conclu- ions and to recommend remedies to meet difficulties. The committee would be raised, one member each to e named bd the governors fo Massa Connecticut and Rhode Isl nd. two by the directors and two by he stockholders then in session. This esolution was supported by, several , nen and as vigorously opposed by thers. MT. Amster agreed that it's ate should rest with the stock vote aken in the special meeting. and this esolution was a factor in the debate ! aken part in by MT. Nixon, MT Am ter and Clarence H. Venner The last amed thought that it's adoption would e an insult to the governors of the tates and it would have meant the ragging in of politics. He was laugh d at when he suggested that if the resent directors are not doing their 'ork well that they . should be l hanged as one man jumped up and V elled that directors could not be hanged when they controlled so many