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 appointed to watch over their interests; much more is it likely when it is a matter of preference holders who are not creditors at all but only what may be called limited partners in the ownership of the concern.

A preference holder who has not a right to a "cumulative" dividend—which has to be paid, if not this year next year or some other year before the ordinary holders get anything—has, indeed, very little right that is worth assailing. He takes his fixed dividend if earned and goes without it if it is not. It is the cumulative right that makes the preference worth having, and it is the one that the holder is likely to be asked to forego if a series of bad years has piled up arrears of dividend due to him that put the resumption of dividends on the ordinary shares into the dim future. In such a case a threat of immediate liquidation held at the heads of the preference holders and an intimation that liquidation will mean that little or nothing will be saved for them from the wreck, leaves them little choice about accepting any scheme of reconstruction involving the sacrifice of all or part of their arrears of dividend, a lower rate in future and possibly the surrender for the future of their cumulative "privilege." The directors represent the ordinary shareholders and the