The Montgomery advertiser., 1902-09-04
TO CONTINUE s YEARS
souTHEHN,9 VOTING TRUST
ASKS FOE EXTENSION.
Cites Danger to stockholders Of the
Loss Of Control in the Open
Market-Statement By
J. p. Morgan.

New York Commercial
Wall Street was amazed today by tn,
financiers now in legal control Of tn,
Southern. These men want and expec
property in their hands for five years
longer and appeal to the stockholders fol
support In such a proceeding.
The proposition comes in the form Of Q
statement issued by the voting trustees
of the Southern-J. Pierpont Morgan
George F. Baker and Charles Lanier--tc
the stockholders. explaining the reasons
which Influenced the directors to POST.
pono the declaration of the October divf.
dend on the preferred stock at their meet.
ing held last week.
After explaining that II the October
dividend shall be declared at the expected
rate the voting trust will be dissolved
the statement says the stock Of the COM
pany will then be issued and dealt in In
the open market. making 1t possible for
the control Of the company to be bought
ard sold from day to day and rendering
its policy subject to sudden and surpris-
ing change.
In this connection, a significant phrase
Is used. This Ii as follows:
THE events Of the last eighteen months
In connection with. railroad properties
have revealed the danger to which cor
pcrate properties are e. posed, Of the con-
troll of their stock being bought UP in
the market by purchasers not identified
with the property or permanently inter-
ested in its development and improve
ment''
To obviate this possibility of the South
err passing out OF the hands of its pres
ent management 1t Is proposed that the
voting trust agreement be extended for a
further period Of five years. or until Oct.
Is, 1901. and thereafter until such date
as a majority Of the stockholders may nix
for the election of directors.
This suggestion that the voting trust
be continued for FIVE years longer was
entirely unexpected in Wall Street today.
and took the financial district by COM
plete surprise.
1t had been generally agreed the post
ponement of the next preferred dividend
was entirely temporary expedient, to en-
able the present management to continue
in unquestioned control of the company
until the plan for the final disposition
Of Louisville and Nashville. with the at
tending Encouragement of the relations
now existing between the different South
ern railroad properties. had been success
fully carried through
The statement in part Is as follows:
Holders of large amounts of preferred
Gates, recognizing this danger. have re-
quested the undersigned the voting trusD
to propose an extension of the voting
trust agreement and have suggested that
pending an ascertainment OF the wishes
of the stockholders on the subject the
Board of Directors should postpone un-
til the September meeting their determin-
alton as to the amount of the October
dividend, for 1t might well be that while
a dividend at certain rate could be con-
servatively paid under a continuance Of
the existing administration the Board
might feel hesitation in declaring so large
a dividend IL stability in the control and
management of the company should be
endangered by the termination of the
voting trust.
"ccordingly, the Board has postponed
fixing the rate of the dividend in order
that the stockholders may have an OPP
portunity of indicesinS their wishes re-
garding the continuance Of the voting
trust so that the Board may have the en-
tire situation before them in reaching
their conclusion as to the rate of divi-
dend to be declared.
"The events of the last eighteen months
in connection with railroad properties
have revealed the danger to which cor
porate properties are exposed, of the
control of their stock being bought up In
the market by purchasers not identihed
with the property or permanently. inter-
ested in its development and improve
ment.
Therefore, we do not hesitate to state
that, In our opinion, 1t Is decidedly Tor
the interests OF the stockholders OF the
Southern Railway to protect their proper
ty by an extension of the voting TRUST
until negotiations now pending for the
. at,1 af hPntnnr
its lines shall be settled beyond any risk
of being overturned, and until the COM
pletion of other negotiations now pend
ing In relation to transportation interests
in the Southern States. which have an
important bearing upon the interests OF
the Southern Railway Co.
1T Is scarcely necessary for US TO state
that In bringing this matter to the atten-
ton Of the stockholders we have no de-
sire to ourselves continue the RESPONSE
bilities of the last eight years; at the
same time we have felt that under the
1t was our duty to make
this statement, leaving 1t to the stock
holders themselves. however, with fun
of all the circumstances, to de-
termine what shall be done.
1T is proposed that the said voting
trust agreement Of october IS. 1894 be ex-
tended for a further period of five years,
or until October Is. 1907. and thereafter
until such date as a majority in amount
of the holders of stock trust certificates
a ssentinR to such extension shall have
fixed by vote on the date of any annual
election for directors of the company
held after October Is. 1907"
The statement then says the extension
becomes operative as soon as majority
of the stockholders shall assent thereto
and present their certificates to be
stamped.
In connection with this proposition the
following Information is given to show
the results which have been accomplished
under the present management:
Miles.
On October Is, 1894. the operated
mileage of the Southern was. 1914
On June go 1902. .......................6 81
Increase - ....s...'s.''s's's'' -.''Syodo-Si
During the same period 76s.22 miles o.
second track, spurs and sidings have been