St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1894-05-12
INSIDE HISTORY OF THE Mp
NO RECORD OF THE. COOKE CITY
RAILROAD STOCK INCREASE.
MIR. EDEs ON THE GRID1RoN.
He Produces the Books Of the
Oregon & TranscontinentaI,
and Submits to q Vigorous
Observation-Disclosures of
the Chicago & Northern Pacific
to the Northern Pacific.

NEW YORK. May 11.-Several new
faces were visible in the group of law
yers, directors and witnesses in the
Northern Pacific investigation today.
Among them were G. w. Wright, one
of the Northern Pacific railroad direc.
tors. and c. A. Spofford, president Of
the Rocky Fork & Cooke City Railroad
company, and private secretary to
Henry Willard. Mr.. Spofford was to
have testified yesterday, but was ex-
cused on account of the absence of his
counsel. L. ID. Searles, vice president
OF the Farmers Loan and Trust CON-
pany, was recalled, and asked whether
ne had been able to find any record of
the increase in the capital stock of the
Rocky Fork & Cooke City railroad CON-
pany from S740. 600 to 81, 900. 900. Mr..
Searles said that the company had no
such record, and that the increase must
have been made before the stock came
into the company's possession.
James Mcknight, senior counsel for
the receivers, stated. however, that he
had the minutes of the meeting of the
stockholders and directors at which the
increase was authorized, and was ready
to submit them at any time. The dates
OF these meetings were April 5, 1889,
and May 4, 1889. Edward Edes. secre-
tary and treasurer of the Rocky Fork &
Cook City company. was replaced on the
stand. G. w. Wetmore, president of
the North American company. asked
permission TO appear as counsel for the
witness. He stated that the books of
the old Oregon & Transcontinental,
inquired for yesterday, were among old
lumber of the North American company.
He was perfectly willing to permit any
of them to be
PRODUCED BY MR.. EDEs
which had any bearing on the case
under consideration, but wished to be
present to see that no others were pre-
scented. After some discussion as to
whether Mr.. Wetmore should not rather
appear as a witness himself. Master
Carey decided to let him act as counsel,
and the examination of Mr.. Eles pro-
ceeded.
Mr.. Edes produced various books of
the Oregon & Transcontinental, which
were placed in evidence. He was re-
quested to refer to those portions of the
books of the company which showed in
what way it was concerned in the plac-
ing of the bonds of the Chicago & North.
ern Pacific. After much discussion it
was finally developed that when the
Chicago q Northern Pacific issued its
bonds to obtain funds for the purchase
of the various properties comprising it
they were deposited with the Farmers
Loan and Trust company. The Oregon
& Transcontinental. acting as financial
agent of the Chicago & Northern Pacific,
advanced the latter some seven or eight
million dollars, and opened subscription
lists for the bonds. As the latter were
paid for, most of the them at 80 cents on
the dollar. the Oregon & Transconti-
mental issued orders on the Farmers
Loan and Trust company to the pur.
chasers for the delivery of the bonds.
For these services as financial agent the
Oregon & Transcontinental received o
commission of 8 per cent. At this
time, Jan. 10, 1890. an agreement had
been made between the Northern Pa.
cifc. the Wisconsin Central and the
Chicago & Northern Pacific. by which
the latter should be formed and leased
to the
WISCONSIN CENTRAL COMPANY,
and by them subleased to the Northern
Pacific. The reason for the introduce
tiOn of a temporary financial agent was
that the options for the purchase of the
roads and other properties, afterwards
consolidated into the Chicago & North
ern Pacific Railroad company. were
about to expire, n it was necessary to
obtain all advance Of money from such
an agent in order to secure them.
The minutes of the meeting of the
Oregon & Transcontinental directors
Jan. 18, 1890. showing these facts. were
read in full. They created something
of a sensation, as they showed that the
plan Of the leasing of the Chicago &
Northern Pacific to the Northern Pacific
was fully understood before the forma-
tion of the former company, and that 1t
was formed for the purpose of so leas-