EARLY ISSUES OF CAPITAL STOCK (continued)
May 25, 1927
At a called meeting of the Directors, held on Friday, Oct. 25,
1878, "The President stated that he had received from the County
of Galveston the Fifty thousand dollars due for the balance of their
stock subscription, being $8,000 in cash and $42,000 in County Bonds".
The second stock certificate issued to Galveston County, No. 223,
for 4,500 shares, is dated Dec. 28, 1878.
These county bonds were sold at a premium of 2-1/2% but the proceeds,
together with the $8,000 in cash received from the County, was not
sufficient to pay off the immediate obligations of the Company,
leaving it indebted in various amounts to some of its own directors,
particularly to Messrs. H. Rosenberg, C. E. Richards, R. S. Willis,
M. Kopperl, and Moody & Jemison, Marx & Kempner, and Wallis,
Landes & Co. Construction work was accordingly stopped, and a
notice was published in the Galveston News soliciting a loan of
$250,000.00 to be secured by a first mortgage on the property of
the road. Payment was to be in ninety days. This amount, it was
thought, would pay off all the Company's indebtedness and complete
construction and full equipment of the road to Richmond.
The advertisement asking for the loan of $250,000.00 had been
published in the Journal of Commerce, New York City, and in the
Boston Post, as well as in the Galveston News. The only offer received
was from Mr. George Sealy who stated that he represented the following
residents of Galveston:
|Ball, Hutchings & Co.
|J. J. Hendley
||Somerville & Davis
|R. S. Willis
|Moody & Jemison
||Wallis, Landes & Co.
||Chas. E. Richards
||Le Gierse & Co.
|John D. Rogers
||Leon & H. Blum
The proposition of Mr. Sealy was accepted at the meetings of both
the Stockholders and the Directors, on Dec. 14, 1878. The Company's
note was executed to George Sealy under date of Dec. 16, 1878, for
$ 250,000.00, at ninety days, secured by a deed of trust on the
entire property of the Company, bearing the same date, and naming
Robert Mills of Galveston as trustee.
At the Directors' meeting of March 20, 1879, the following resolutions
|"RESOLVED, That on and after this date
all parties desiring to subscribe to the capital stock
of this Company shall at the time of subscribing for the
same pay to the Company the face value of the number of
shares subscribed for. And no stock shall be deemed to
have beeen subscribed for until the par value thereof
shall have been paid to the Company".
|"RESOLVED, That the President be authorized
and instructed, to call in
person or through the Secretary, on each delinquent subscriber
to the Capital stock of the Company and demand of each
the payment of arrears on subscription; or propose to
exchange a release of obligation the delinquent relinquishing
to the company the amount paid and the Company releasing
the delinquent from the balance of the subscription".
|"RESOLVED, That in all cases where parties
refuse either of the above
propositions, notice of sale be given in accordance with
Sec. 9 of the Charter".
As the Railway Company was not able to meet the note to Mr. Sealy
on its maturity, the Trustee under the mortgage sold the entire
property of the Railway Company at public outcry before the courthouse
door in the City of Galveston on April 15, 1879. Mr. George Sealy
bought the property for $200,000.00. The Trustee's notice to the
Directors of the sale, is spread on the minutes of the Directors'
meeting of April 17, 1879. A resolution adopted at that meeting
recited that the sale included "all chartered or corporate rights,
franchises, and privileges of every kind and description whatsoever
of said Company". It was also resolved:
|"That the present corporate organization
of said Company constituted by this Board of Directors
does now cease and determine, and that the right to such
organization devolves upon said Purchaser and his Associates".