New-York tribune., 1903-04-17

portion OF the surplus was .oI
oered for sale But this is not all for While RAM ahe
road and Tor its outstanding bonds and Ier Snas ns
Sol,tsn managers subsequently decided they might might
as well go in for additional sums, because III
tSe Central @ Gre cTcssoSn Railroad corpany lines TO
take up that companys onsaan91g 9g horse cars 10
electric traction SO that the inSneaSe ,o @ IA snnars
10 have been pretended. turns out to be exactly
r Is Clear, therefore, when the companys own
statements analyzed that the InSermToT ovde5 H
ss eacTa5ee 9 &c % psTs s Ia Excess OF honest
requirements OF the Metropolitan co,npayo ayyo,,snv's
own reports and statements that on Feoauaf of the
,2 at the time time. of Rer the Company there existed
Third N iqZVaaSe ATen9e Railroad SsHh company
THE 100000 NEW STOCK.
- ,,,.,. nc 4s.o tbe Metropolitan Street Railway
Corapany made an application TO the state 5o@tI -
Of RaToad Com e @ 5 TO sa o55oo or 10000
stock The president OF me . hoaq' ~ s1ch nj an
davlt. sworn 10 june Is 1900 a'tache0 u SUN
THAT st least 100000 viii be required req 10 pay ~
the expense OF such change that II IS p9PosT" b b
devote the balance of said increased s1oS5 G Of he
proceeds OF the sac theeb % ~ coop8ny Contracted
for purchase Of stocks in other stEeSt and
that s4,eeeoeo and upward VIII be Te1u"eu i0'
In December 1eeo this 100000 new stock was
offered for subscription to the stockhoaeIs % sst &
saIfment IN its report for 1901 - 1072 il appears
that the OF sl050o4 go IS cs was % a Lance
shea+ Cf +be company shows that during the year
IL d1a more 'l yTb cash disbursements show that
loans amounting TO s7.14AsoS z were pald 0uilNs
By referring to the cornpanys report fer ls9 so
TS5;r5 1D' Avenue Railroad Company was ccnsuIn-
mated it VIII appear in the company cas9 81 s,at ~
amount Of SS56o00 and that cash was disburssd
for stocks and bonds Of other companies III me
II is apparent. therefore, when az these facts
stock provided sufIicient sum of cash 10 P2g for
construction and to pay IN IolI I 1I,e F Trird
Avenue stock but Of other street railway stocks
sfc corDaI1v in its application of June &c 1900 to
the Railroad Commissioners for an increase "a
capital stock
n7r ph,bjn's report says that since the lease
Of The Netropolitan to the Interurban com
many the latter has been borrowing millions OF
dollars to pay in part its obligations to the
Metropolitan company, while the MetropoItali
fn its behalf has been borrowing also many
otter millions Of dollars, which ought TO nave
been supplied by the Interurban company. N
July last he says, the Metropolitan issued
S11 100000 OF its Own bonds and turned ne pro-
ceeds over TO the Interurban- He adds:
1T is clear that this 100000 was pro-
xided for the purpose OF enabling the inter-
urban company carry out it's contract TO
pny per cent guaranteed dividends on the
ss2,o40.OOO of Metropolitan stock, for the In
of its own, and its only earnings are repre-
sented by the earnings of the Metropolitan
company itself, which never have been and
not at present equal 10 per cent OH i's
eaPitaI stock.
Accordingly the anomaly is presented of
the metropolitan company, although a credl-
tor of the Interurban, increasing its own liza
biIities by SI1,00o.00o SO as TO enable the
Interurban company to carry ont its Suaran-
tee cf paying dividends upon Metropolitan
stock. In other words, the metropolitan
<t1gEd der hslN
tent of S1IO00.00 so that they might receive
unearned dividends in the future which they
themselves thus to have provided
through the creation OF an obligation Tor
which they themselves are liable, and which
is actually n first lien upOn All their
property.
Regarding the alleged excessive valuation Of
the Metropolitan investments as shown by re-
ports, Mr.. Phbn says:
In Schedule A OF the lease Of the Metropolitan
Street Railway Company to the Interurban Street
Railway Company. dated February IL 1872, q lst
Street Railway Company is given in detail show
ing the par value rate Of interest or dvidend the
securities. such fun value amounting TO total OF
on Page "a of the mortgage and deed Of trust,
dated March y, 1902, of the Metropolitan Street
IS trustee are detailed the pledged securities Of the
Metropolltan street Railway COMPANY; suGh n t HSe
application to the NeVy-YorI Stock Exchange for
30 1857, and is further confirmed in an application
Of the company to tke Stock Exchange on July 20
IN Schedule A, above referred TO- the market
a9,1 ~ cair,t9 II nv the cdnosrT 1Innn sIIch njedeed
securities and it is found that such valuation is
S6.3700e0. It is accordingly seen that the grand
total Of both -unpieoged and Pledgea securities a3
amounted S19.464 30 yet. as pointed out at the
Of the quarter Immediately preceding the Inter
urban lease. or on December 81. 1901 the company
sS5 Sc. and a still higher valuation amounting to
S225sl.5G 76 March 81 1902 the quarter follow
II We adopted the smaller valuation. or that of
december 81 lsyi as full Ealu3uon on FebruaIy H.
falsely stated value OF its investment stocks
and bonds Of other companies in its balance sheets
IN sum not less than s. 7S5 &C.
The total value of these investments set out in
6ss rs S. and On Jnne st go Z 1s5 81 li s Tese
Eales are TePFesentsd by n more 7 than @ Sl2o3So OF
rnent Of part Of the stock and bonds held at
present as investments, and by the cash proceeds
from the sales of other shares Of stock devoted 10
the purchase Of such investments. The total
inyestnnents approximate S26eo36oo par value upon
dividends or al the rate Of s $500 YEAR. But
the company's income from these investments, as
It's own annual reports prove is but about 100000
year. In other words, the company is paying out
annually N.so0 ;oo0 to receive in return 100000
No one could possibly doubt OF the consideration
& f tgse 9nd 3 other her rRet facts bearing upon
has been manipulated TO the advantage Of some
person or persons for il IS clear that If the
pany is losing Soe0000 annually through these
equal extent
An effort was made by representatives of The
Tribune last evening TO get from H. H. Vree-
land or his counsel replies to Mr. Phlbn's re-
port At Mr. Vreeland's house, in West Sew
enty-second-st-, it said he at home
and would not be home last night. Delaney
Nieoll. Of counsel for Mr. Nreeland and the
Metropolitan said he had not had time TO read
the report and would not talk about it,
Following the directors Of the Metropoli-
tan Street Railway Company and OF the Inter
urban company:
Observation-Disclosures H VreeIand Dresident-