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The society planned general commerce including the fur trade, vineyards, linen manufacture, fisheries, glassworks, brick kilns, tanneries, mining operations and assistance to the Indians in making settlements. It obtained 400 acres within the city of Philadelphia and bought from Penn 20,000 acres in the country.

Within six weeks of the charter, shares had been allotted to over 200 subscribers, in minimum units of half of a £50 share, at five per cent deposit. The equivalent of 108 shares was subscribed initially and this may have increased very quickly to 160 or even 200. Penn’s eldest son and many of his friends became large shareholders. According to a letter from the treasurer, James Claypoole, the society planned to call two tranches of 25 per cent of the nominal price per share in 1682 and the remaining 50 per cent in 1683.

The initial subscribers were mainly in England, but it was intended rapidly to transfer the company’s domicile to Pennsylvania, to obtain ratification of the charter from the Pennsylvania assembly, and to give enhanced voting rights to shareholders resident in the province or owning at least 1000 acres of its inhabited land.

The society’s first president, Nicholas More, was well received in Pennsylvania and was appointed to several provincial offices – secretary of the provincial council, speaker of the assembly and a provincial judge.

Despite this, the provincial assembly declined to ratify the society’s charter, and it was apparently not regarded as a corporation under Pennsylvanian law, for lawsuits were later brought against individual officers, not the society itself. The society’s subscribed funds were spent on real estate bought from Penn and on English goods, many of which were sold on credit.

As early as 1683 Treasurer Claypoole wrote a bold letter to William Penn saying that some people would say they had been induced to subscribe by Penn’s charter and had been cheated.

Despite Penn’s efforts to support and encourage the society, the Indian trade failed to develop, the society suffered losses from bad debts, and Nicholas More – a difficult man – was replaced as president and fell into disgrace as a judge. In a dispute with the assembly, he became the subject of America’s first articles of impeachment in 1685, but Penn and the Provincial Council refused to sanction the proceedings, and More was restored to office. The society became involved in bitter disputes and litigation, and it soon largely ceased business except as an owner of real estate. By 1704 the society was being referred to as ‘the old Pennsylvania company’ and it drifted towards its eventual dissolution in 1723.

Brian Mills (The International Bond & Share Society. Tel: 01737 842833)

Pictured: This share receipt of the Free Society of Traders in Pennsilvania (sic), issued in London in 1683, is expected to make the highest auction price ever paid for an antique English company share document, when it is offered by RM Smythe & Co in New York on July 29.

The record hammer price of DM70,000 (£26,000 at the time) is currently held by an East India Company share document sold at a German auction in 1989.

Only two examples of the Free Society piece are known to be in collectors’ hands. They reached the scripophily market via an estate auction in Pennsylvania two years ago. One of these two achieved a hammer price of $36,000 (£25,000), against an estimate of $2000-$3000, when sold by the specialist auctioneers RM Smythe & Co in March this year.

This second piece will go under Smythe’s hammer at the Algonquin Hotel in New York City on July 29. Although in somewhat poorer condition than the one already sold, it is estimated at exactly ten times the previous lot’s estimate, now that more is known about its historic background.