The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1894-10-13
THE FIGHT is BITTER
Between the Two Santa Fe Rail-
road Committees
ATTEMPT TO FIRE OUT DIRECTORS


The Atchison Protective Reorganiza-
ton committee which was created by the
stockholders who are dissatisfied with
the past management of the Santa Fe
system, is making a hard and bitter fight
for the defeat of the present board of di-
rectors at the annual election to be held
in Topeka, Thursday, October 25.
The fight at the pr esent is for the pos
session Of the proxies of the stockholders
to be voted at the annual meeting.
The executive committee viii vote all
the proxies in their possession for en-
tirely new board of directors, while the
General Reorganization committee will
vote all the proxies it secures for en-
dorsement Of the present directors
The General Reorganization committee
was brought into existence BIZ the old
board Of directors. and has many friends
among the local Santa Fe officials, some
Of whom no doubt dream that their places
would not be secure if a change was
made in the directory. These local
friends of the General organization
committee predict that the Protective
committee will not do anything great.
As one official said today: "Tht Protect
i've committee has made no examinatio
OF the books of the company,
and all that crowd knows about the
conditions of the company is what infOr-
nation has been dropped by Mr. Stephen
Little"
On the other hand the Protective com
mittee seems to be advised Of what IS
going on, and Judge J. Erb. one of the
attorneys for the Protective cQmmittee,
who is now in Chicago, has made some
sweeping charges against the old direc-
tors for their mismanagem Of the
property.
The Chicago Post says: Judge Erb
makes the startling charge that the com
pany has been robbed Of over $3.50, OG0.
600, and insists that the amount has gone
into the pockets of the men intrusted
with the control of the property. though
he does not Call the persons by name nor
specify the sums that found their way
into the individual pockets Of the trus-
tees.
THE methods BY which the alleged
plundering was carried on are described
with particularly, however One item
mentioned was the purchase of the St.
Louis s. San Francisco (Which is declar-
ed to have been worth nothing) for
$4,000 900. Ia addition to the purchase
money was $3,OOO,OOO floating
debt and the entire floating debt Of the
Atchison s. Topeka half of which be-
longed to the St. Louis & San Francisco).
amounting to 80, 567,O1S This one
deal is therefore held responsible for the
loss of nearly $46,OOO.00O, which money
might as we'll be burned for all the good
it did the stockholders. in the estimation
through Judge Erb.
The acquisition of the Colorado Mid
land for 81, 300, 600 is stamped as another
piece OF almost criminal malfeasance on
the part of the management Both roads
have been run at a loss since their pur-
chase and have been useless appendages
to the main system.
f'The conversion of 100000, 600 income
bonds into 4 per cent second mortgage
bonds, covering the whole property Of
the company, is characterized as a gift
of that much of the AtchIsOn stOckhOld-
ers' money and credit to people who ad
no claim whatever upon them 1t is ex-
planned by Judge Erb that the in
come bonds have no interest, unless
earned each year in excess of fixed in
terest obligations. He says that prior to
their conversion into second mortgage
bonds the income bonds were worth little
or nothing, and that they were picked up
for song by interests in common with
those of the officers Of the company re-
spOnsible for the change, but that after
the conversion they increased enormously
in value, the profit. of course, going into
the pockets of the then owners of that
line of securities. At the same time the
fixed charges of the company were in
creased 81 100000 year, for which in
crease there was not the faintest shadow
of an honest excuse.
Judge Erb, who is in Chicago for the
time being, says that the Protective Re
organization committee, beyond the
shadow of a doubt, will have clear ma
jority of stock to vote at the annual meet
ing, thus making sure that the interests
of the mass of stockholders will be looked
after by men not participants in the era
of management or friendly to them"
In addition to this under the date of
October g. Simon Sterne and Newman
Erb attorneys for the AtchisOn PrOtec-
tive Reorganization committee have is
sued another circular 10 which they at
tach all the names of the reorganization
committee and in which they say refer
ring to a circular issued by the board Of
directors October 3:
1T would be unnecessary for this com
mittee to take any notice of the circular Of
Oct 3. 1898, but for some of the statement
therein characterizing as an unqualified
made to the effect til at the new mem bers
OF the board of directors are merely sub
stitutes for retiring persons.
This committee desires to present to
the stockholders the facts upon which
the statements made we're based.
1T must be conceded by the Board that
the new members were not selected by
the stockholders Of the company, and it
is therefore a pertinent question to en-
quire, if not so selected. then BY whom
were they designatedT They could
scarcely have been designated by the old
members of the Board, without having
first been invited by their predecessors
to take their positions.
The old directors have about one
month more to serve prior to the regular
annual election of the company. Their
resignatiOns while under the attack of
this committee, are in themselves signifi-
cant Their designations one BY one and
the election of their successors by their
votes. certainly furnish conclusive proof
that thew are mere substitutes and that