The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1902-03-25

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= other lines Of this state. =
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NEW YORK, March 2L-During the
! N inquiry today into the merger. Mr..
Schiff said his firm never repre-
scented the Union Pacific or the Oregon
Short Line as bankers in the stock mar
ket. He declined to say whether the
firm had so represented Mr.. Hartman.
AS far as he could recollect the pur-
chases made by his firm Of Northern
Pacific before May last year amount
ed to SS,OOO,0OO. a few weeks later this
stock was transferred, part to the
Union Pacific and part to the Oregon
Short Line.
The witness said he had no confer
ence with J. p. Morgan concerning
these purchases, but there was a con-
] ference between himself and Mr.. Har-
riman on one side and J. J. Hill and Mr..
Steele Of J. p. Morgan & Co. on the
other. He said there were two such
/ conferences, but at neither of them
was there a showdown to determine
whether the Hill or Hartman interests
obtained a majority of Northern Pa
cific common stock. AIr. Schiff said
he did not learn of the facs that the
Union Pacific was disposing of its
Northern Pacific holdings until the
matter came before the board of direc-
| tors, of which he was a member. The
stock was sold to J. P. Morgan & Co,
and payment was made in S9000,0 900 or
SO O00, 600 cash, and $50, 900, 600 or $90,-
100000 in stock OF the Northern Securi-
ties company.
Expected a Profit.
The witness said Mr.. Hill asked him
to take a place on the Northern Sc
eurities board Mr. Schih said he first
learned of the retirement of Northern
Pacific preferred stock at the time of
its actual retirement. He did not know
whether Mr. Hartman had been con-
suited in the matter. Mr.. Schiff said
the Union Pacific and the Oregon Short
Line sold their Northern Pacific be-
cause they thought it would be a good
thing to get profit on their stock.
The stock was originally purchased
because Kuhn, Loeb & Co. thought it
was good thing to do. 1t was the
object of the firm to obtain as much as
possible of the stock. The first infor-
nation the witness had Of the organ
ization of the Northern Securities COM
pany was when he read about Il in
the newspapers. He had nothing to do
with the organization Of the company.
nor had any interest in its affairs until
he became a director at the invitation
Of Mr.. Hill.
". 7. ClOugh. vice president OF the
Northern Securities company, was then
called upon to furnish a copy of the
bylaws of the company.
To Raise 100000.
Charles Steele Of Morgan & Co. was
then called. He said Mr.. Bacon of that
firm had conducted the purchases Of
Burlington stock made last year. The
firm organized a syndicate 10 raise S50-
600 600 cash, which was necessary in or
der to buy control OF the Burlington.
The object of the purchase, he said,
was to reap the profits that would re-
suit from getting eastern and south
eastern connections for the Burlington,
he having grain and timber lands In
the territory traversed by the other
company.
Mr.. Steele said that there never had
been any ironbound agreements be-
tween him and Mr.. Hill and Mr. Nor
gan that they would hold on TO their
Northern Pacific stock. The plan Of re-
firing Northern Pacific preferred had
come up before 1901, he said. On May
I. 1901, J. p Morgan & Co had about
So 600 900 worth of Northern Pacific
common, and between May 1 and May
they bought about s15 5000, 600 worth
In the middle of the summer they sold
SO 000.000 worth of IL TO the Northern
Securities company, getting stock OF
the Northern Securities company IN re-
turn. The purpose of conference i'm
r1aaFsafaTs- E4ar. the Tfsf4-rf,l MO- of
9. Mr.. Steele said, was to ailay public
apprehension, and TO that end the Har-
Timan interests consented to give Mr..
Morgan Northern Pacific proxies at the
next election.
Morgan Named Five.
This was done he said. because the
public had confidence in Mr.. Morgan.
Five new directors Of the Northern Pa
cific we're elected al the suggestion Of
Mr.. Morgan.
Mr.. Hartman was placed on the
Northern Pacific and Burlington boards
to quiet any apprehension that might
exist as 70 the intentions Of the men IN
control of the Burlington. Next fol-
lowed some testimony as 10 the sale
OF the $4,000, 0e0 worth of Northern Pa
cific common to the Northern Securities
company. Mr.. Steele said the Northern
Securities company paid $50 900 900 for
the stock IN reply TO questions he
said the idea Of turning the stock OF the
Great Northern over 10 q holding COM
pany was first brought to his attention
as long ago as a year. and as to the
Northern Pacific company, the plan
vas brought TO his attention the latter
part OF the summer Of 1901 He said
he was not aware that all The negOti8-
tons during the summer of 1901 had
been with view Of getting a majority
of the Northern Pacific stock. and to
dispose Of the stock ia the manner in
which they were disposed.
A Compromise Arranged.
At this point the witness was turned
over to Mr.. Stetson. who is counsel for
the fra Of J. z. Morgan & Co. The
early part Of air. Scissors examination
was for the purpose Of disDroving the
claim OF the other side that the neEo-
tiations for Northern Pacific common, /
the Burlington purchase, the formation
OF the Northern Securities Sbmpany and
the placing of AEr. Hartman and otaer
representatives. Of the Union Pacific
in the boards Of the Burlington
and Northern Pacific were all part
of the pooling schesre which orig
mated and matEred during the
summer Of 1901. previous 10 the
formation OF the Securities company.
with Mr. Morgan Mr.. Hill and ar.
Hartman and their associates as the [
principal factors. Nr Steele said there /
was no PRIOR understanding that after /