Valentine Democrat. (Valentine, Neb.) 1900-1930, January 09, 1902, Image 3
BLOCKS THE BIO MERGER. Injunction to Restrain Retirment of North ern Pacific Preferred. Northern Pacific , Great Northern and a Part of the Burlington Are Declared Parallel. Minneapolis. ( Special. ) Just after the noon hour today Charles S. Mel- len , president of the Northern Pacific Railroad company , was served with papers which enjoin the company from retiring the preferred stock. The order was issued by Judge El liott of the district court of Henne pin county on the application of Peter Power of New York , who holds 100 shares of the common stock. It was supposed that the failure of the action brought in the New York courts by holders of preferred stock cleared away the last obstacle to the retirement of the preferred on Jan uary 1 , leaving the Hill interest in control of the road through its ma jority of thecommon stock. s The injunction restrains the North ern Pacific Railway company from is suing or selling any certificates of-in debtedness or debenture bonds or other evidence of indebtedness or cre ating any indebtedness or liability for the purpose of raising money with which to pay or retire the preferred stock of the Northern Pacific Railway company , or any part thereof , or from using or appropriating any moneys or proceeds other than the ordinary or surplus net earnings of the Northern Pacific Railway company to the pay ment and retirement of the preferred stock of the company or any part thereof , and also from creating any indebtedness or liability other than the ordinary indebtedness and liabil ity for the operating expense of its railroad system , and the indebtedness and liability now existing which would be a preferrence or take precedence of the common stock of said company , also from placing Its property , or any part thereof , or the management of its railway system or any part thereof , in the possession or under the control , either directly or indirectly , of the Northern Securities company , or from entering into any agreement or ar rangement , either directly or indi rectly , through the medium of the Northern Securities company or oth erwise with the Great Northern Rail road company , the Chicago , Burling ton & Quincy Railway company or either of them , for the purpose of causing the railway system owned and controlled by then. Northern Pa cific Railroad company to be operated in connection with or under the same rules or by the same authority as the Great Northern Railway company and the Chicago , Burlington & Quincy Railway company , or either of them , or from entering into any agreement with these companies , or either of them for the purpose of avoiding competition and fixing rates for the carriage of freight and passengers . upon cither of their lines of railway. DEFINES COMMON AND PRE FERRED. The petition recites briefly the his tory of the Northern Pacific railroad and the divisions of its stock into common and preferred. It is alleged that the only difference between the preferred Istock and the common stock was that the preferred stock was en titled to the 4 per cent dividend prior to anything being paid on the common stock and the bill in this connection alleges that the preferred stock was subject ! to be retired at any time within twenty years after the time of reorganization of the company and the issuing of the stock out of the surplus net earnings of the company and not otherwise , that in other re spects the rights of the preferred and common stockholders were identical. The next bill recites theh organiza tion of the Great Northern , Chicago , Burlington & Quincy lines and al leges that the Northern Pacific rail road company and Great Northern Railway company are parallel lines to the Pacific ocean and that the Chi cago , Burlington & Quincy railroad lias a parellel line from Billings , Mont. , to Chicago and that such lines are competing lines for the business of the northwest. PURPOSE OF CONSOLIDATION. Tt is alleged that the officers of the Great Northern rt ad during last sum mer and since the plaintiff became the owner of this stock , and without any knowledge on his part , went into a combination with the Great North ern and the Chicago , Burlington & Quincy , the purpose of which was to consolidate the three systems under one management , and knowing that it could not be legally effected , the di rectors of the three companies , for the purpose of doing Indirectly what they could not do directly , caused to be or ganized the Northern Securities com pany , a New Jersey corporation , with a capitalization of 5100,000,000 , which , under its charter was auhorized to purchase and hold stocks , bonds and SAYS WHITE MAN MUST RULE. ' Cleveland , O. ( Special ) General Jo seph Wheeler was in this city today in the interest of a new army rifle. In a newspaper interview he stated , in re ply to a question on the possibility of ' a. political break In the south : "There Is no question that the su periority of the white race , in the south must be maintained. . Anyone who has seen the south under the rule of the other color , as it was directly ili * - - * securities of other corporations , the intention being to cause a majority of the stock of all three raiway com panies to be transferred to the North ern Securities company , and to be controlled by it , thereby controlling the three systems of railway through thhe medium of the Northern Secur ities company , suppressing competi tion , regulating the tariff rates and conducting the entire business of the three systems as one corporation. PRONOUNCES SCHEME ILLEGAL. It is further alleged that thereupon the Northern Securities company com menced to advertise on terms of ex change , all the stock of the Great Northern company , and that the whole scheme was illegal , in violation of the law of this state and other states through which the railway lines pass , against the pubic laws of the United States and of each of the places. The bill also alleges that under and by virtue of the charter of the Northern Pacific Railway company and under the provisions of the re organization agreement the preferred stock can only be paid for and re tired out of the net surplus earnings of the Northern Pacific Railway com pany and not otherwise. That notwithstanding these provis ions the directors of said company , for the first step in carrying out their plan of transferring the control of the defendant corporation to the North ern Securities company , have served notice upon the holders of the pre ferred stock , that on January 1 , 1902 , they would retire such preferred stock. The bill alleges further that since Its reorganization the Northern Pacific Railway company has con ducted a successful' and profitable bus iness and has paid 4 per cent on its preferred stock and is now paying 4 per cent on the common , out of the earnings , after paying the fixed charges and the operating expenses ; that there is a fund of about $3,000,000 set aside to secure payments of divi dends on preferred stocks and be tween $2,000,000 and $3,000,000 of a general surplus ; it has now on hand exceeding $3,000,000 derived from the earnings of the road , wherewith to pay the $75,000,000 of preferred stock at par , but that in order to retire such preferred stock the directors of the company are threatening to issue and sell certificates of indebtedness of debenture bonds , amounting to $75- 000,000 of the Northern Pacific Railway company , and out of the proceeds pay off the stockholders of the preferred stocks at par , January 1 , 1902. NOTICE OF RETIREMENT. It is alleged that the Northern Pa cific Railway company has caused to be sent to each of its preferred stock holders a notice that it would retire the whole of the preferred stock at par on January 1 , 1902 , and that the transfer books of the company were closed Tuesday , December 10 , 1901 , at 3 o'clock , for the retirement of the prefered stock aforesaid. The paintiff says he has been unable to obtain a copy of the resolutions of the board of directors as to the issue and sale of the certificates of indebt edness or debenture bonds , but the general effect of the resolution , he al leges , is set forth in a circular issued by the Northern Pacific railway to the stockholders , a copy of which circular is made a part of the bill. It is alleged in the bill that no meet ing of the shareholders of the defend ant company has been called to make the issue of the certificates of indebt edness or debentui-e bonds ; that the board of directors is without power to issue such call ; that at the time of the issue of the certificates of stock to the common stockholders when the com pany reorganized in 1898 and by the reorganization agreement provided "that the company shall not put a mortgage on its property embraced in the property in the Northern Pacific system , nor shall the amount of the preferred stock be increased except after obtaining in each instance the consent of the majority of holders of the whole amount of the preferred stock and the consent of the holders of the majority of common stock , to be voted separately ; that the plaintiff Is unable to ascertain whether certifi cates are to be secured by a mortgage on the property of the Northern Pa cific company or not , but whether se cured by mortgage or not it constitut ed an indebtedness due and payable not later than 1907 , with interest at 4 per cent , whether the company has any. earnings or not out of which to pay It , and , an indebtedness upon \yhich judgment can be obtained , the property of the company sold , the rights of the common stockholders foreclosed and that if the common stockholders foreclosed and that if the common stockholders or a portion of them take advantage of the option of fered them to take common'stock for their certificates of indebtedness , the common stock is greatly increased without the vote of the stockholders of the company and without the au thority of the law of the state where i was incorporated. NOT A LIEN ON PROPERTY. The petition alleges that it was pro posed in this way to substitute for the present preferred stock , which in no way constitutes a lien upon the prop erty of the Northern Pacific company and is not a charge against the earn ings of the company and has no prior after the war , can understand why this must be so. For one reason white supremacy alone can insure financial stability. There will be no political break in the ' ' 'solid south' Jby any party which tries to interfere from the north , through the medium of politi cians , with the solving of the color problem by the south. Slbley , 111. , schools are closed on ac count of an epidemic of smallpox in mild form. right over the common stock except in priority of dividends , a convertible , negotiable security or debenture bond , bearing Interest at the rate of 4 per cent per annum , which said amount of 4 per cent per annum is a fixed charge against the earnings of the company and its property and must be paid whether the earings for any year amount to 4 per cent upon said issue of convertible certificates of in debtedness or debenture bonds or not , and under which , if default is made In the payment of said interest or any payment of the principal when due in 1907 or at any time prior thereto un der the provision of said certificates of indebtedness or debenture bonds , the entire property of the Northern Pa cific Railway company be sold to sat isfy the judgment or judgments which may be obtained thereunder and all equities and rights of the common stockholders extinguished. SCHEME PROVOKES LITIGATION. The bill sets forth that the scheme has already provoked litigation , which Is now pending , and plaintiff swears that by reason of public criticism oth er serious litigation will be instituted unless the defendant railway company be restrained from carrying out its il legal scheme and design , and in this connection it is allegede that proceed ings are about to be instituted against the Northern Securities company , the Northern Pacific Railway company.the Great Northern Railway company and the Chicago , Burlington & Quincy Railway company by some one or more of the states through which the roads pass , to prevent the consolida tion in the manner alleged in the bill , .and that the action of these compa nies wil linvite and arouse hostile and punitive legislation by all states thro' which the roads pass , and that in tht case the railway company should car ry out and accomplish the plans and schemes mentioned it will be subject to have its charter rights forfeited. The bill recites the provision for the constitution of the state of Montana prohibiting the consolidation , of com peting and parallel lines of railway , and also the laws of the state of Washington prohibiting the consolida tion of parallel and competing lines , and alleges that the Northern Pacific and Great Northern Railway compa nies are parallel and competing lines. GIVE PURPOSE OF COMPANY. It is particularly alleged in the bill of complaint that the Northern Securi ties company is a railroad corporation and was organized for the express and sole purpose of uniting under its man agement and control the defendant , Northern Pacific Railway company.the Chicago , Burlington' & Quincy Rail road company and the systems of rail ways controlled and' operated by each of these railway companies , respect ively , and for no other purpose , and that the Northern Securities company was organized for the purpose of own- Ing , holding and controlling all three of the corporations mentioned in the bill and their various systems of rail way , so that all competition between these companies may be stifled and prevented.and that unjust and inequit able exorbitant rates for both freight and passenger traffic may be obtained by them. The bill further sets forth that it is the design and purpose of the North ern Pacific Railway company , the Great Northern Railway company and the Chicago , Burlington & Quincy Railroad company to consolidate and merge in the Northern Securities com pany , the complete and exclusive con trol of each and all of these railway systems and that the proposed at tempted retirement of the preferred stock of the Northern Pacific Railway company is solely for the purpose of enabling the Northern Pacific compa ny to turn over to the Northern Se curities company a majority of the stock of 4the Northern Pacific Rail way company ; that the proposed and attempted creation of an indebtedness of $75,000,000 on the part of the North ern Pacific Railway company is solely for the purpose of paying off and re tiring the preferred stock , to the end that a majority of the common stock may be so turned over to the North ern' Securities company. It is alleged that in case the North ern Pacific company proposes to and does carry out the plans and scheme leged in the complaint that the plaintiff will be irreparably damaged and that he had no remedy at law for his damage or Injury or any part of it , either against the company or the officers thereof. The bill then prays for the writ of injunction as issued by Judge Elliott. MEAT SELLING AT RUINOUS FIGURES. Denver , Colo. ( Special. ) Meat is selling at ruinous figures , a fact caus ed by the war between the butchers' union and the Swift Packing company. Retail shops became involved and the prices dropped 50 per cent , which makes them 30 per cent less than the cost on the hoof. The union has warn ed retailers that a boycott will be de clared on all shops handling the Swift product. The fight was caused by the refusal of the Swift companyto pay a fine of $500 , imposed by the union for selling to a non-union shop. The state of Colorado is involved , and the company announces it has ? 1,000 , 000 to spend In order to win out. Call on the President. Washington , D. C. ( Special. ) Sena tor Perkins of California introduced to the president. Prof. Campbell , superin tendent and director of the Lick ob- servatory.and Prof. Simon Newcombe , he ceelbrated astronomer. Prof. Campbell invited the president to visit the Lick observatory. The president old him that it was his Intention to make a trip to the Pacific coast next summer and that if his plans were carried out it would give him great pleasure to visit the observatory. JOE BARTLEY IS PARDONED. t The Defaulting Ex-Treasurer Is Released From the Penitentiary , Governor Savage Declares He Has Been Punished Enough , Gets Many Petitions. Lincoln. ( Special. ) With his wife on one side and his daughter on the other former State Treasurer Jo seph S. Bartley walked out of the doors of the state penitentiary last week with' a full pardon in his hand to commence the year 1902 a free man. Governor Savage signed the papers which brought Bartley into1 the world again. The time served by the former state treasurer in the walls of the prison is , counting the time put in in the Douglas county jail , five years , seven , months and eight days. Governor Savage commuted his sen tence to this period and the time ex pired at midnight , December 31. i i Private Secretary Clancey was sent j to the Bartley residence with the papers. He placed them , together with a discharge from the peniten tiary , in Mrs. Bartley's hands. The house was a scene of the ut most excitement as the family hastily entered the carriage of Charles O. Whedon and drove with all speed for the big gray stone building. "Warden Davis had been expecting them and had the prisoner ready. His incarceration was all the more bitter since the taste of liberty he had had 1 by the parole grantedy the governor i July 13 and recalled July 28. | The scene , when the family met in the warden's office , was an affecting . one. But after the first greetings and congratulations the party went to the carriage and drove directly to the Bartley home. Here it was but a few minutes until crowds of friends bfcgan to gather and overwhelm him with good wishes. In vitations to New Year dinners were given almost without number , but the former treasurer refused them all , . preferring to remain at home for the ' day. Bartley's real imprisonment CCTI- menced when he was first placed in the Douglas county jail , June 24 , 1897. The supreme court approved his sen tence of twenty years in the peni tentiary July 6 , 1898. The recall of the parole of July 13 was due to the action of the state re publican convention , where resolutions were passed. With the commutation of the sen tence Governor Savage has issued a long statement of his reasons. He has , he says , come to the conclusion that Bartley has suffered enough for his crimes and that the sentence shoud be shortened. The primary question to be consid ered in all cases involving executive clemency is , "has the prisoned been punished in a degree commensurate with his offense ? " the governor says. His action answers the question as he sees it. A thorough examination int othe de tails of the matter has been made , Governor Savage says , and this has convinced him that the demands of organized society have been met. He also gives attention to the state ments that have frequently been made that Bartley's offenses were more bit terly criticised than they might have been throughthe fact that the state was then in thhe throes of a cam paign and that Bartley's sentence had in it something of a personal equa tion. In closing the governor says he has petitions containing the names. , of more than 4,000 of the state's most prominent citizens , asking for Bart ley's freedom STIRRED BY THE BARTLEY PARDON. Lincoln , Neb. ( Special. ) Governor Savage has left for a short tour of the southern states , his final destina tion being New Orleans. At the state house it was understood the pardon of Joseph Bartley was to be the final act of executive clemency for the present holiday season. No local happening for months has caused the sensation that did the release of the former state treasurer. Governor Savage said he had receiv ed many personal expressions of ap proval of his act , as well as messages of congratulation. Telegrams of the same tenor poured into the Bartley home , and friends and former neigh bors called to express their good will. In this city there were also expres sions condemning the governor's ac tion , accompanied by predictions that it would have an important political bearing. Mr. Bartley would make no statement. The theory that the gov ernor was actuated by the belief that the pardoned man would be in a posi tion to make restitution ofpart of the funds lost to the state was neither affirmed nor denied. Congratulated on Honor From' Kaiser Washington , D. C. ( Special. ) Miss Alice Roosevelt , the daughter of the president , was much complimented to day by her friends and acquaintances over a cablegram from Berlin , convey ing the information that the kaiser wanted her to name his new yacht. Thus far no official intimation of the International compliment has reached the White house. The kaiser's request , when officially made , will take some time to reach .Miss Roosevelt , through tha usual diplomatic channels. FIGHT MERGER IN THE COURTS , Helena , Mont. ( Special. ) A defi nite plan of action to defeat the pro posed consolidation of the Northern Pacific , Great Northern and Burling ton railway systems was today unanimously agreed upon by the gov ernors and attorneys-general of sev eral northwestern mates in which those roads" have mileage. Legal action will be instituted Im mediately in Minnesotacourts with this object in-view , and to quote At torneys General Douglas of Minnesota , "the thing will be fought to a finish. " Just how , when or where these suits will be brought , neither Governor Van Sant of Minnesota or Attorney Gen eral Douglas would state. The con ference adjoruned late this afternoon after adopting resolutions condemning the proposed merger as contrary to sound public policy and pledging sup port to any proper legal action which may be brought to test its validity. The first resolution is as follows : "In our opinion the consolidation or threatened consolidation of the Great Northern , Northern Pacific and Bur lington railway systems in the several states through which they run as par allel and competing lines is contrary to sound public policy and also , with the exception of Idaho , is in violation of the constitution ctnd laws of said states , and mindful of the obligation which the law imposes in such cases upon the officials of the several states here represented we hereby give our unqualified approval and endorsement to any proper and suitable proceed ings which may be Instituted in any court having jurisdiction by the sov ereign state of Minnesota or any other state affected thereby , designed and intended to speedily and finally test and determine the validity of such consolidation or threatened consolida tion and to that end we hereby pledge our earnest co-operation , and , fur ther , we unanimously protest against any combination or consolidation which restricts or stifles free competi tion in the trade or commerce of the country. " This resolution was unanimously adopted. The second resolution , which was a substitute for the one offered by Governor Hunt of Idaho , along the same lines , was as follows : "Whereas , A consolidation of the great transcontinental railway lines is threatened , which , in the opinion of the members of this conference , is inimical to the public welfare , there fore be it "Resolved , First , That the con gress of theh United States be and hereby is requested to investigate the general subject and take suitable ac tion thereon. "Resolved , Second , That power should be granted to thhe Interstate Commerce Commission to fix maxi mum rates upon interstate traffic and to regulate the same. "Resolved , Third , That a copy of these resolutions be forwarded to the senators and representatives in con gress of theh states here represented. " Governor Van Sant expressed him self as much gratified over the re sult of the meeting which had been requested by him. "So far as I am concerned , " said he after the meeting adjourned , "I am thoroughly satisfied with the work o ? the meeting. It accomplished all that could be desired. I am very mucb pleased. " BOER GALLS ON THE PRESIDENT. Washington , D. C. ( Special. ) Com mandant W. D. Snyman , who was a member of General Dewet's staff in South Africa up to a year ago , and who for some time nas represented the Boer cause in the west.called upon President Roosevelt. Commandant Snyman is a tall , fine-loking Boer and talks English with a slightly broken accent. "I called upon the president , " said he , "to ttiank him for having sent to my wife , who is in South Africa , some money I desired her to have. I shall always feel grateful to President Roosevelt. I saw my wife's signature today for the first time in months. " "How did you wife get the money ? " "Through the United States consul at Capetown and her answer to my letter was returned through the same channel. ' He did not think the war in South Africa a proper subject to discuss with the president. He simply wanted Jo thank him for getting the money to his wife. "TheBoers , " said he , 'can see easily that the president can do nothing to stop the war even if he vere so disposed. But we will appeal to congress for an expression of opin- on. We hope that both political par ties in this country will unite in such an expression. We do not want the matter made a party question so as to embarrass the United States in any vay. I believe the English people vould welcome an interference suffi cient to cause the authorities to drop the war. eW are willing to make some concessions. " Guarded By Dogs. Rawlins , Wyo. ( Special. ) Guarded faithfully by his two dogs , the body of W. M. Mooney , one of the herders of the Pacific Sheep company.who was frozen to death , was found by search ers and brought to this city. The dogs had been by him several days , and kept the coyotes away. Governor Rodgers Funeral. Tacoma , Wash. ( Special. ) The fu neral of John Rankin Rogers , the bird governor of Washington , * was held yesterday. The entire city was draped in black and thousands of peo ple thronged the streets. The remains were escorted to the Hillside cemetery at Puyallup , by several companies of he National Guard , and fifty files of Masons , besides a long procession of riends and tho public. The services at the grave were under Masonic aus pices. \ DISOLVES THE . INJUNCTION. Federal Court Decides in Favor of Northern Pacific. Refuses to Allow Appeal from Order ' Setting Aside Injunction to Re strain Retirement of Stock. Minneapolis. ( Special. ) Judge * Wil liam Lochren of the United States circuit court today dissolved the temporary injunction , issued in the case of Peter Power against the Northern Pacific Railway company by Judge Elliott of the district court of Hennepin county Monday. The Injunction which was disserved by the order of Judge Lochren re strained the Northern Pacific from ia- suing any evidences of indebtedness to retire 'the preferred stock of the com pany or to retire the preferred stock in any other manner than by the use of the surplus net earnings of tho road. It also restrained the Northern Pacific and its officers from entering- into any agreement or doing any act by which the road would be consoli dated or merged , through the medium , of the Northern Securities compan > with the Great Northern or the Bur lington , or either of them. After the decision was made orally by Judge Lochren at the close of a day's argument by tne attorneys for both sides , an effort was made by the * plaintiff's attorneys to have the court fix the amount of bund which would be required in order to appeal from the decision and to stay all further proceedings in the lower court pend ing the appeal. Judge Lochren refused to allow a supersedeas bond in any amount to be given. Judge Lochren held that the North ern Pacific was acting wihin the au thority of its charter , of the contract entered into between it and its stock holders as Incorporated in the cer tificates of preferred stock and of tha agreement of November 13 , in at tempting to retire the $75,000,000 of preferred stock in the manner al- lege-1 by Mr. Power. He also held that railroad corpora tions could not do indirectly what tha law prevented them from doing di rectly and that any method by which , consolidation of two or more compet ing and parallel lines would be brought about would be illegal and a writ of injunction would be to re- si rain the consummation of the plan. bit that there was nothing in the c ise as presented to him that would indicate that the stockholders of th Northern Pacific Railway company were attempting such a consolidation or merger. Judge Lochren in his decision made a ruling which the attorneys of J. J. Hill ? aim settles the question of the legality of the proposed merger. Said the court : "If the Northern Pacific Railroad ! company never thought of consolida tion , but to pay off the preferred stock holders and issue common stock , it had authority to do that , and that of itself would certainly have no tend ency toward consolidation. "It seems to me tflat the preferred stock may all be retired without the Northern Securities company being formed and if unlawfulness consists not in the retiring of this stock but in the acts which result in the forma tion of that company and placing- other securities in that company. " Mr. Powers' attorneys tonight au thorized the statement that the fight had just begun and that they would appeal to the United States suprem court. RUMOR MISS STONE JS FREE. JUondon.Special. . ) A dispatch to > the Central News from Vienna says a repart has been received there via Sofia to the effect that Miss Helen : Stone , the captive missionary , has been released. The report lacks con firmation. Washington , D. C. ( Special. ) The state department officials say they have no recent news bearing on tha case of Miss Stone and therefore can not confirm the dispatch from London transmitting a report that she has been released. At the same time such , a consummation of the efforts in her behalf would not be surprising , as the latest information received here shows that responsible parties are in communication with the brigands who hold her captive and the latter know these parties have all the money that can be raised with which to ransom the captives. London. ( Special. ) The Sofia corre spondent of the Daily Telegraph has cabled an unconfirmed rumor to tho effect that Miss Stone and Mme. Tsil- ka were liberated in Turkey on Janu- . ary 1 and that the Americans who conducted the negotiations resulting in this reported release agreed , in the presence of the captives , to maintain , absolute silence regarding the-captors. - Must Eat Pet Dogs To Sustain Life. Berlin. ( Special. ) The distress among the agrarians is most serious. The farmers are flocking to the cities in the hope of obtaining food. Many- have been compelled to eat their pet dogs , in order to escape starvation. Things have reached such an extrem ity that the authorities in the villager of Geben are seriously considering a. proposition to open a dog butchery. order to properly prepare carcases consumption. - _ .