Page:Federal Reporter, 1st Series, Volume 9.djvu/757

 742 FEDERAL REPORTER. �floating debt by giving them, in lieu of and substitution for their evidences of debt against the old oompany, second preferred income bonds of the new company equal to the amount of such floating debt and interest. This income. bond is, by the tenus of agreement, a higher grade of security than the stock of the old company; that is, the stockholders get no dividend until the interest on these bonds is all paid. The stockholders are placed behind the holders of these bonds, and the plan seems to fairly contemplate the protection of all classes of creditors of the old company in the equitable order of their priori ty. It was the evident purpose of the parties to this agreement to place these floating-debt holders in at least as good a relation to the new company as they bore to the old company. They got for their unseoured indebtedness something which at least bears the semblance of a security. It was a second-mortgage bond. No com- plaint is made of anything inequitable in the provision by which the holders of the mortgage debt should be paid in full in the manner pro- vided in the agreement ; nor is there any suggestion that there was any fraudulent collusion between the bondholders and stockholders to defraud the unsecured creditors. �It would seem almost obvious, from a statement of the amount of bonded and unsecured indebtedness of this old company, that it could not have been anticipated that this railroad property would or conid have been sold for cash; or, if a cash sale had been insisted upon, it would only have partly paid the holders of the first-mortgage bonds. The plan adopted had what seems to have been a due and equitable regard for the interests of all classes of creditors and stockholders, and it does not seem that upon the statements in this bill any in- justice was intended or bas been done to this creditor. He undoubt- edly bas been offered much more than he could have got had the holders of the secured indebtedness insisted upon their full payment, as they would seem to have had the right to do. If this bill had shown that this creditor had accepted the provision made for him under the scheme or plan of reorganization, or had accepted the income bonds he was eutitled to receive, and there was still a balance of bis debt left unliquidated, he might, under the authority of the case which bas been referred to, have had a right to call upon the stockholders to surrender the stock which it was provided they should receive as a part of this schema. But it is not necessary to discuss that; and I refer to it only for the purpose of showing that he makes no such statement. He does not show he has accepted the provision which was made for him, and has come into the scheme for the purpose of ��� �