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150%) | _ BOND CONVERSION PLAN STOPPED. Vice-Chancellor Emery has given an oral opinion making permanent the temporary injunction secured a week ago by Miriam Berger of Sulli- van county, New York, restraining the United States Steel 'Corporation from retiring $200,000,000 of preferred stock and issuing $250,000,000 of bonds instead. | ment of the preferred stock constitutes a preferential reduction of the cor- poration's capital among those assenting to the plan anda corresponding impairment of the right of those not.assenting. The decision lays down the unequivocal rule that preferred stockholders are shareholders and have vested property rights which cannot be impaired by boards of direct- ors without their consent. ih z It is contended that on behalf of the complainant, Mrs. Berger, that the proposed action of the United States Steel Corporation, by which $200,000,000 of the preferred cumulative 7 per. cent. stock is to be retired by the issuing by the Steel Corporation of $200,000,000 of 5 per cent. bonds in lieu thereof, is illegal-and unconstitutional in that it compels the com- plainant and all other preferred stockholders either to take 5 per cent. bonds in lieu of their stock, and thus lose 2 per cent. interest, or, if they do not consent, to have a prior lien of $200,000,000 placed ahead of their preferred stock without the corporation, getting any new consideration therefor, or without any consideration passing to the stockholders who do not consent to the burden thus imposed upon them... It is further con- tended by counsel for Mrs. Berger that the Steel Corporation did not have power to retire preferred stock bythe issuance of bonds in lieu thereof, prior to the act of 1902. It.is contended that this act which, on the face of it, allows the steel company to make the proposed conversion, is unconstitutional and void as to the complainant and others who bought their stock prior to the passage of the act. The Steel Corporation contended, on the other hand, that the act of 1902 was constitutional, and further that the proposed conversion was authorized by the contract among the stockholders themselves existing prior to the passage of the act. Vice-Chancellor Emery holds that the Steel Corporation did not have the power to make the proposed conversion prior to the act of 1902, and that the rights of stockholders, which had vested prior to the passage of the act, could not be taken away by that act which was contrary to the provisions of the constitution of New Jersey. Counsel for Mrs. Berger contended that the act of 1902, which was passed to allow the Steel Corporation to make the proposed conversion, was unconstitutional, on two grounds--that it took away the vested rights of stockholders and was special legislation. On account of the great im- portance of the case, the vice-chancellor has decided to continue the in- junction, on condition that the complainant agree to argue the appeal, if one be taken, at the next session of the court of errors and appeals, which will be held the latter part of June. Francis Lynde Stetson of counsel for the United States Steel Cor- poration said: 'An appeal has been entered from the judgment of the court, ordering the permanent injunction. Beyond this, we cannot say just what course will be pursued." ee It will be remembered that counsel for both sides last week, at the suggestion of the vice-chancellor, entered into a stipulation that the party against which decision should be rendered should file an appeal immedi- ately thereafter, the object being to expedite the litigation and obtain at the earliest possible day a definite and. final adjudication from the court of last resort upon the important question of the legality or illegality of the proposed conversion of preferred stock into bonds. At the office of J. P. Morgan & Co. no statement could be obtained beyond a reaffirma- tion of Mr. Stetson's announcement. CARGO RECORDS OF LAKE FREIGHTERS. The steamer Henry Steinbrenner loaded a large cargo of soft coal-- 6,696 net tons--at the Elsworth lake front dock, Cleveland, a few days ago, but it is not large enough to have place in the record list. The two largest coal cargoes as yet moved on the lakes--7,688 tons of anthracite and 7,388 tons of bituminous--are credited to the. Steel Corporation steamer I. L. Elwood. The Steinbrenner was not fully loaded. She was going to Fort William where draught is limited, and with 273 tons of fuel in addition to cargo was drawing only 17 ft. 1 in. forward and 17 ft. 7 in. aft. She was loaded within twelve hours. Cargo records are as follows: Iron ore--Steamer Wm. Edenborn, owned by Pittsburgh Steamship Co., A. B. Wolvin of Duluth, manager, 7,446 gross or 8,339 net tons, Two Harbors to Conneaut; tow barge John Smeaton, Pittsburgh Steamship Co., A. B. Wolvin of Duluth, manager, 7,446 gross or 8,339 net tons, Du- luth to Cleveland, draught of 18 ft. 1 in. ' Grain--Steamer Simon J. Murphy, Eddy Bros. of Bay City, 269,000 bushels of corn, equal to 7,532 net tons, South Chicago to Buffalo; steamer Douglas Houghton, Pittsburgh Steamship Co., A. B. Wolvin of Duluth, manager, 308,000 bushels of clipped oats and 60,000 bushels of corn, equal to 7,520 net tons, Manitowoc to Buffalo. Coal--Steamer I. L. Elwood, owned by Pittsburgh Steamship Co; A. B. Wolvin of Duluth, manager, .7,688 net tons anthracite, Buffalo to Duluth; steamer I. L. Elwood, Pittsburgh Steamship Co., A. B. Wolvin of Duluth, manager, 7,388 net tons of bituminous, Cleveland to Duluth. New works of the Philadelphia Pneumatic. Tool Co., Twenty-first street and Allegheny avenue, Philadelphia, are being operated night and day. Attention is being attracted to the Keller pneumatic hammers, made by this company, by reason of a recently-devised improvement in their construction. It is claimed that on account of this improvement the working capacity of the chipping and riveting hammers is increased 25 per cent. and the vibration inseparable from any pneumatic tool is reduced materially. This applies to both chipping and riveting hammers, Recent large orders have been received from the Southern Pacific Co., Newport News Ship Building & Dry Dock Co., Pennsylvania Railroad Co., Lack- awanna Steel Co., and others. uite an unusual privilege was accorded the two American naval off- ee O'Neil and Comd'r Beehler, who attended the naval congress at Dusseldorf, in allowing them to visit and inspect the Krupp works at Essen. It has hitherto been the custom to rigidly exclude all foreign naval officers. In his opinion the vice-chancellor holds that the retire-. MARINE REVIEW, " »- AROUND THE GREAT LAKES. Capt. Frank Welcome, well known among vessel masters of the lakes, died in Buffalo a few days ago. The remains were taken to Port Huron for burial. a : The recent accident in the United States canal at the Sault has served to remove doubts that existed as to the depth of water through the Canadian canal and its approaches. In the several days that the vessels used the Canadian canal exclusively, there was not an accident of any kind, and the steamer Curry passed down drawing 18 ft. 2 in. _ Officials of the United States lighthouse board advertise elsewhere in this issue for bids for the construction of the twin-screw lighthouse tender Crocus, to be built for the tenth lighthouse district, which takes in Lakes Erie and Ontario. Bids will be opened July 10. Plans and specifications may be had from the lighthouse board, Washington. The plans are also to be seen at the office of the inspector of the tenth light- house district, Buffalo. _ _ Corrigan, McKinney & Co. of Cleveland, dealers in iron ore and pig iron, have decided to close their Duluth office and transfer all work heretofore done in Duluth to Cleveland, where the main offices are located. Amos Shepard will hereafter be superintendent of the company's mines on the Mesabi range, with headquarters at Hibbing. George Wal- lace, superintendent of the Crystal Falls, Mich., district, has resigned to go into business for himself.. His successor has not been appointed, Representatives of Chicago vessel interests and city officials of 'Chi- cago have been holding conferences of late with a view to establishing rules for the navigation of the Chicago river. Attorney Chas. E. Kremer has been representing the vessel interests. The city seems anxious to get new and complete rules governing the river into effect, since there have been no end to accidents to bridges of late, which vesselmen say are due only in part to the fact that tug service has not been available to all craft during the tug strike. Among important revisions suggested by the vesselmen are rules providing large red lights on the bridges at night and the red ball now in vogue, for day use. In the latter instance arrangements will be made so that the bridge tender will be kept more closely to his duties, a point on which vesselmen have long been given reason to complain. Capt. Michael Fitzgerald, who was in command of the steamer George G. Hadley, which sank the whaleback steamer Thomas Wilson off Duluth harbor afew days ago, with the loss of nine lives, has been deprived of his license. by the local steamboat inspectors. Capt. M. C. Cameron, commander. of the Wilson, had his license as a pilot suspended for sixty days. In the case of Capt. Fitzgerald, Inspectors Monaghan and Chalk inflicted. the: severest penalty under inspection laws. Capt Fitzgerald is an old navigator and;had before the collision borne a splendid reputation. The inspectors found that no passing signals were exchanged between the Hadley and Wilson, although they were approaching each other nearly head on. The movement of the Hadley in starboarding her wheel when too near to avoid a collision was, the inspectors found, not author- ized by any rule. The fault of the Wilson was in continuing at full speed after the Hadley had turned towards her. It was also found that no alarm signals were used by either ship. FORESIGHT OF MR. J. PIERPONT MORGAN. Mr. John W. Gates says that Mr. J. Pierpont Morgan is the greatest financier that the world has ever known. We are delighted to have Mr. Gates assume a position which we can unqualifiedly indorse. Mr. Gates adds that Mr. Morgan has in mind plans which are far vaster than any yet executed and that he proposes shortly to astonish the world. This, how- ever, will be nothing new as Mr. Morgan has already astonished the world. The manner in which things are dovetailing into each other, as we shall presently show, is very interesting. The dovetailing is doubtless a delib- erate operation and shows that Mr. Morgan is possessed of a very long head. Asa promotor Mr, Morgan is absolutely alone. He does not seek money. Money seeks him. While not the richest man in the world by any manner of means he is by far the most powerful because he controls the money of the rich. This is the direct influence of character. Char- acter is the greatest force in the world. It is greater than intellect and greater than wealth. It is commonly accepted that the Morgan properties are managed for the benefit of the shareholders--that is why money is forthcoming for any of his combinations in unlimited quantities. The biggest thing which Mr. Morgan has yet accomplished in the way of combination is the United States Steel Corporation. This great company seems to be the base of all his other industrial ventures. It is in the busi- ness of producing the raw material for tributary industries, and it is in those tributary industries which largely consume the output of the Steel Corporation that the Morgan money seems to be making a definite in- vestment. The house of J. P. Morgan & Co. has just turned over to the United States Ship Building Co.--the new ship yard combination--the Bethlehem Steel Co., the control of which it has held for over a year. It is understood that whatever plates, angles and ship material the new ship yard combination may need over and above the capacity of its own plants to produce shall be secured from the United States Steel Corporation. Mr. Max Pam, counsel for the Steel Corporation, has been added to the board of directors of the ship yard combination. The first sale of United States ship building subscriptions has been made on the curb at 105. The Raritan Dry Dock Co., Perth Amboy, N. J., recently launched the hull of a substantial wooden tugboat, built to the order of Theodore Smith's Sons Co. of Jersey City, N. J., for the United Fruit Co. of Bos- ton. The tug is 75 ft. long, 17 ft. wide and 9 ft. deep. She is built of oak, sheathed with metal and copper-fastened throughout. The engine is a fore-and-aft compound, the diameter of the cylinders being 13 and 26 in. with 14 in. stroke of piston. She will have a Scotch boiler 9 ft. by 10% ft. She will be named El Criado. The Riter-Conley Mfg. Co. of Pittsburgh has recently decided to adopt alternating-current one a for power distribution: They have purchased three 200 K. . engine-type Westinghouse generators which are. to be direct-connected to Westinghouse gas engines using natural gas, Alternating currents will be used for all work, including cranes, and a number of Westinghouse type "F" induction motors will be geared directly to straightening rolls.