New-York tribune., 1906-07-06
VELLS-FARG0 AFFAIRS.
Official Statement IN Reply to Criti-
oism of Minority Stockholders.

e-.t official statement in reply 20 the charges
80 minority stockholders committee was made
O . .bs management OF Wells. Fargo & Co. yester-
y - !, : long circular 10 stockholders. With the
-,.- there was inclosed a proxy running in the
...es Of F. H. Hartman, Dudley Evans, Will
- Herrin and II. B. Parsons.
-, hodv Of the circular made up OF an argu.
=. :, opposition 10 the contention made by the
,,oritv stockholders headed by Messrs. Stokes,
'..h6eld and Pomeroy. The directors refer TO
- control OF the company. under the promise
= o~travagant cash dividends or watering. the
- bv creating stock scrip on dividend basis,''
- say that in contrast TO these plans their own
,,r has been ito conserve the capital of the in
-,or represented by your stock through the
,sblishment OF the company upon sound and
.,shle basis assuring permanency Of existence
,,a certainty and regularity OF fair dividend
srrns rather than the temporary and speculative
.olicv of larger and fuctuating dividends"
The result Of this policy. they say. is shown In
,is fact that the surplus OF the company, which
: ,su was sSSOOO0 is to-day S2.4OO.OcO
gg,e express business. the circular points out is
a.,endenf almost entirely upon contracts with
railroad corporations for express facilities over
their lines and express companies must assume
lara financial responsibilities. well as properly
discharge the varied requirements OF the service.
FOR the proper conduct OF such a great business
lsrse cash capital is necessary to secure and
,,s,ntain the confidence OF the commercial world
and transportation lines, and 20 enable the COM
pany 10 obtain the most profitable classes OF bus-
ness.
The present strong position OF Wells, Fargo g.
Co is said in the circular to be largely due to the
contracts made in 1893 with the Southern Pacific
Company. when that corporations financial needs
Induced it yield the present favorable contract
This contract however, has only eight and a half
years run
The surplus is held intact the directors say. and
IS subject al times to the requirements OF the
business. h is loaned from time to time TO
sponsihe borrowers, but always on call and with
ample stock exchange collateral and at the current
OF interest. The directors pay their respects
as follows the interests represented by Walter
c. Stokes & Co:
The gentlemen seeking control Of the company
assert In their circulars that they do not desire
reconcile these satements with the fact that they
candidate for chairman a gentleman until lately
connected with manufacturing establishment. and
fssted ~ these f-en3er1en tI1af the rnosa ~ SO ~
ssllsu - - el1t aLe Putp or ue
TlOy II TO acquire exclusive express facilities the
is no foundation in fact for this statement.
Discussing The agitation for an increase in the
dividend rate. the circular says:
The directors are not Indifferent 20 the desire Of
stockholders for larger return by way of divi-
panys business its absolute dependence upon rail-
road sfiliations and connections. the growth and
Of possessing large financial means and RESPONSE
hiIy TO secure favorable traffic agreements with
railroad companies. the importance OF being able
IN times of business depression and even disaster
70 preserve unimpaired the credit OF the company
and maintain a steady rate of dividends it is the
Judgment OF the directors that the rate Of divl-
denos should not be put upon scale which may
Lot BE- maintained which restricts the growth and
resources OF the company. and which is not con-
serVatVe and sound In business Of this character.
The condensed balance sheet Of the company as
Of May 81, 1885, Is made part OF the circular It
shows total resources of S20,4s2,T4 as follows:
Bonds and stocks owned. s5SBe5O; short time bills
receivable, secured by approved Stock Exchange
odatersl ST. $50 257: real estate 81 IN so. eI IN
tank $6.Ii; accounts receivable, Ss02 334 In this
st no account is taken. the circular SAYS Of the
sApIess equipment consisting of Office furniture
ealfs wagons horses. structures on railroad rights
@s way, etc The liabilities are: Capital stock
ssSsysV ss accounts payable. SS257; surplus reserve
eI'ES55i Ile per cent Semi-annuaI dividend
Parable this month. is not included in the state