The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-08-06
THE MAKING OF THE ASPHALT
TRUST.


downright dishonesty and with fragrant
violation OF the law. Replying to some Of
these charges, Gen. Francis V. Greene, ono
of the parties involved, made this statement
in an open letter to the Puddle Ledger OF
Philadelphia, under date Of March 20. 1902:
Every step In the formation OF the Asphalt Com
pany OF America and the acquisition OF the sub
sdlary companies taken under the best legal
advice and every such step was then and Ia now
believed 10 have been proper In law, equity and
morals.
Between the allegations of those who
pronounce the transaction fraudulent and
this reply of Gen. Greene, there appears n
wide discrepancy either in the matter of
fact or in the olearnesa of individual moral
perception. Manfestly, a given proceed
ing cannot be both legally and morally
wrong. as asserted by those who prefer the
charges, and proper in law, equity and
morals" M declared by Gen. Greene. We
essay no determination Of the point of law
in such cases made and provided but
herewith set forth the facts of record so far
as it is possible to extract them from the
tangled and confused mass in which the
only available records of the case are pre-
scented.
The Asphalt Company Of America was
incorporated under the laws Of the State
OF New Jersey on June ~, 1899 Its capital
was $50 600 900, in 800 600 shares of $50 each.
Immediately upon its organization, $50 ,0OO,-
600 in S per cent. gold collateral certificates
was issued These certificates we're to be
exchanged, and were so exchanged, for the
stock Of the numerous smaller companies
of which the Asphalt Company Of America
was directly and indirectly made up.
Reference to published official records
shows that the total par value of all the
various stocks for which this $50, 200, 900 in
per cent. gold certificates was to be ex-
changed and paid amounted. approximately,
to Sl4 900, 600. As some of these stocks were
salabe only at long discount from their
par vame, while others are said to have
been practically worthless, and even some
Of the best had never sold at II pre-
MUM, il ia quite within bounds to assume
that the actual market value of these hold
ings was under rather than above $40 OOO-
900 Yet somebody was to pay $50 900 600
for them and somebody stood TO lose the
difference between the price paid for them
by the Asphalt Company of America and
the actual value OF the stocks. While it
may be assumed that a collection of gems,
or OF books, or even of postage stamps,
acquires value, as a collection, which is
greatly in excess of the total of the individ-
ual value OF it's component parts, the prop
osition does not of necessity hold good in
the case Of an assemblage of profitable and
Improbable street paving companies.
Bv one OF those curious condolences which
sometimes appear In transactions OF this
nature, il so happened that the same group
OF gentlemen played the triple role Of sellers
Of the stock of the subsidiary companies;
of BUYERS OF the same stock. in their capacity
Of organizers of the new enterprise; and as
the Intermediates in the transaction 1t
Is alleged that there was "rake-of" OF
some 81, 600 900 TO this collection of Asphalt
Pooh Bahs in their capacity Of intermedi-
aries, and the receiver of the now defunct
company is reported to have begun legal
action against AMI l.. Barber, Francis V.
Greene, William l.. Elkins, George D. Wide
ner, William II. Crocker and some eight or
ten others for the purpose Of making them
disgorge their little commission for the
benefit Of the stockholders.
In the matter Of the charge that the stock
Of the subsidiary companies was turned
over to the new company at fictitious and
greatly Inflated values, the ascertainab!e
facts appear in the following analysis In
order to obtain the full flavor Of the gen
uine humor of the proceedings, it is neces-
sary to keep IN mind the fact that the sellers,
tue buyers, and the brokers are all one and
the same group, up to the point where, In
kindly philanthropy. they let in the eager
investing public which wanted to get rich
quick by buying tho securities of the
Asphalt Company of America at prices
which were evidently three to four times
their actual value. Somehow, these hun
cry but confdng souls do not now quite
see where the laugh comes in.
The largest individual organization which
appears in the formation Of the trust" is
the Barber Asphalt Paving Company, in
which the following gentlemen are given as
holding that number Of it's $4,000 shares
which is here set against their names: