Buchanan County bulletin and guardian. (Independence, Iowa) 1866-1869, 1867-10-25
The Dubuque e. Sioux City R. R.
Letter from John S. Kennedy in Reply 10
Ptatt Smith.
DraUouE, Oct. lzth, 1867.
To Tie Eaikor Of TIE UuLn1us limes:

To he Editor of The Dubuque Times:
Sir Since my arrival here ny attention
has been called 10 q letter Of Mr. Plat
| Sn.isA's, under date of the 5,h inst, which
appeared in your paper OF the 9Th inst, and
willie am very unwilling to enter into any
controversy with one towards whom / have
for so many yeaf8 held lie relations l have
toward Mr. Smith, and especially TO bring
that controversy before the public, still iu;h
| and justice a.iAe demand from me, occupy,
I ing he position ! now % in the company
winch lie has seen &. to assail, a plain state.
ment Of cena.n facts, lest silence should be
construed into .n admission on the part Of
! ilie coDpan; VI the cor.ectacs Of M.. Smith 5
allegations.
] will not attempt 10 write detailed reply
10 all Mr. Smith : verbose generali;ies, Or "
lmitate the acrimonious spirit which per-
, yades them, b.. the following statements
VII enable disinteresied and unprej adiced
public TO Judge wha. reliance is to be placed
o. lis Siaiesae.i;s.
III irst ACC laintance with Tie Datuaue
L 2 ciEe Railroad Company commented IN
1851, ard I en- found Mr. Plat Smith. in>
,imatey connected With and holding con-
tleniial aud Influential position in its coun-
c.ls. The panic u 1851 dispe.ed lis SAN
g4i4e views, IL common with those OF every
other person then connected .iia il, and the
difficulties that had then. and have
s.lce had 10 be encountered 10 pushing
.orSas! new railroad enterprises
were No. confined 10 shis company, but have
been ieit more or less By almost every rai>
ruad company in the country, Leading some
OF lae ,ery best OF them to make assigi.>
u.eAi:, to have receivers appointed, the mort
cages fo-eclosed, and the com psaies reor
g.aized. This company wen. through .has
process under tie direction Of III. Smith,
ani was reerganized ss tie Dubuque (
SioGz City Railroad Company. A preierE-
ed stock was created, secured By mortgage
which vas given in exchange for the oil
Construction bonds, a.d cornE4oa stock was
given share for share ia the new COMPANY.
in exchange for the stock Of the old compa>
ny The mortgage 10 secure the preferred
stock pEo.lc-d that the company should is-
SIZE 10 mortgage bonds without the consent
III writing u three.fou-:hs in imteres, OF The
preferred stock holders. This mortgage vas
drawn up by Mr. Smith, as attorney Tor tie
company. and this condition WAS insisted
upon by the bondha lders les, the directors
should incur additional Indebtedness for ex-
tensions, aud lhas the power was vested in
| the stockholders and not in the directors,
| and this condition had to be conceded Ia or
der to secure The building OF tie road even
to Cedar Falls and here arose one Of the
! main difficulties to the extension OF the road
! beycni tha. point, tor i Was no easy matter
IL get sach consent, the stock being held
| largely by parties in Europe who either had
no, the means or the disposition 10 engage
in extensions, and who would hot give their
asssn, 20 others doing it lest All increased
bonded d. bi msgh, impair the value af Ike
stock they owned. This feeling was not con-
aaed ~ European holders, bu, was largely
shared by parties IL Dubuque, who claimed
! that tie one hundred miles from Dubuque
I to Cedar Falls was able 10 earn the div md
l to which they were eniilled, and as they could
get nothing more, they had 10 Interest in
| .ar.ber extensions. Mr. Smith knows well
/ the difficulty eneountt red in getting the as
sent o. the preferred stockholders 10 the ex-
teasiosa ives; of Cedar Faiis-the attempt vas
! made TO 2 { the ass nt to go TO RI. Dotge,
| but il could not be obtained, and ia order
not 10 fail entirely, some parties we're indus
| cej 10 give Qualified assent, restricting the
company from going beyond Iowa Fails,
aid in this way the requisite ihree-iour. Is
assent Was obtained ard the extersion to
Iowa Fails secured. These and many other
difficulties had 10 be encountered b lie
present management 10 accomplish wha; l.ss
been done, aud nobody knows better than
Nj. Saith what these difficulties were. ard
the sacrifices individuals now in tie nan-
agemea, lad 70 make to surmouns them.
Many shares @. preferred stock we're pur>
f.l. u ff.s la
gu. which, the road would hare had its tel>
minus at Cedar Falls to day. II, then. aay
ere should be eensared .cr haviug done 50
i,iie, i. 5 surely no: the uien who nave done
50 q aeh i: and ye, j, is agains, the rien who
has stood by the road iroal Ers; to last, and
siaad by il 10 day, that Nr. Smii.. las lsyel>
ed his maleeicii0ns.
Il is long since the management. fel; thai;
.r enable them 10 proceed with the extension
o! the road they must lave the mora. gad
material support CT tie connecting roads
that gave the an outlet towards tie east.
and Efforts we're made to secure this. Last
fall negotiations commenced With the Iili>
nois CeaiFal Railroad Company, with giew-
~ lease, bat were suspended early in .ae
prsseHt year aad were not resumed again
aGtii Augus: last. The result you hnow-a
lease oi :hs Dubuque & Sioux Gig Il. Il.
hlil,.-and TO DC buiil,-has been made 70
tie Illineis Central Railroad Companr, in
GLIDING tie Cedar Falls & Minnesota road .
and they have been ia possession Of and have
been operating ihe roads since the lss last.
The Dubuque 4 Sioux I,ls 2. +. Cen. pan :
are pledged forthwith 10 ge on With tie ex.
tension u the road, and came hese \, the
reqaes. OF the Board OF Directors, empower.
ed by them 10 make the necessary contracts,
ard have TO day made contract with
Nessrs. Douglass. Brown { Co. tor the ga
ding from Iowa Fails to Fort Dodge.-.he
work TO be commenced immed Lately and
prosecuted rapidly 10 completion, aad ihe
track viii lie laid and the road il operation
to that poiut in the COURSE of next :nIl.
Nov as regards Mr.. 5 ei,h's sale of stock
and resignation as a Director, tie facts are
simply these: lie sold or transferred lis
s;oe < ON the l3.h Of November. 1906, aud
his in.eres. in the road As ,tockhoiler ceas-
ed on that date. Al that time be was Dir
rector and N,ce President aud Attorney O.
the Company. The hy y-laws Of the Com pan y
provide taai no person shal. be eligible as 4
Director unless be Is the bona fde owner of
100 shares Of preferred stock. When Mr.
Smith sold his stock he did not resign but
continued to act as Vice Presidcn, and Di.
rector, wrote the Annual Reror, of the Com
pany in February last, the President beng
then in Europe, and continued 10 draw his
salary monthly as before. Attention Was
called to the TACT Of bis having disqualified,
and at The election ia February last, though
his terms, i; he had retained his qualification
would not have expired for another year, il
was proposed to elect some enc IN bis place;
but urged his retention, believing that he
had only temporarily disposed of his stock
aud would yet requaliiy; but he did not do
so, and finally at . meeting Of the Board
held on the list Of June last the following
resolutions we're passed unanimously:
WHEREAS. Mr.. Patt Smith, having ceased
to he the nolder Of ten thousand dollars of
the preferred stock Of this company.
Rsso.red. That in accordance with lie by.
laws, article four, his position Of dieec,or Of
the company. and with it the Vice piesiien.
cy, be declared vacant.
Resoirea, Tha. tho Secretary be requests
ed 10 send copy OF this resolution u Mr.
Saith.
Mr.. Smith now tells US tha, he sold out
bis stock last November, marx you) be,
cause all hope or extending the road mad
died cut, and to get up a new party to occu-
py the abandoned ground. Now, the fact is
thrt Mr.. Smith sold his stock when negotia>
~ 4