Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1907-01-05

OF the whole capitalization of the road.
the oregon Short Line during the last
six months bought s32, 100000 of the
common stock and 81 .000, 900 OF the pre-
ferred stock of the Baltimore & Ohio
Railroad company. the two purchases
representing 1852 per cent of the road 8
capitalization. The Oregon Short Line
also bought S14000.0U0 OF New York
Central and Hudson River Railroad
company, or 1907 per cent. Purchases
also were made OF large blocks of stock
In the Atchison. Topeka & Santa Fe
amounting to 7.6l per cent of the total;
OF Chicago, Milwaukee 6 st. Paul
amounting to 3.42 per cent of the whole,
and OF the Chicago & Northwestern
amounting to 1892 per cent of the whole.
Chairman Knapp asked for the exact
date of the Illinois Central purchase
but Mr.. Mahl could not give It. He
said he thought some was bought In
July and some In September or October.
Mr.. Lovett of counsel for the rail-
roads said he wished It understood thar
OF the S2S,000,000 OF Illinois Central
stock down on the statement as belong
ing to the Union Pacific. ss.500.000 was
really held by the Railroad Securities
company. the stock Of which is held by
the Union Pacific.
WHERE MONEY CAME FROM.
Mr.. Mahl was asked where the Union
Pacific got the money to buy tNo stocks
related.
He said the report of June 80 last
showed surplus of s5l 900, 900.
Where did the Oregon Short Line
get the money to make its purchases ?"
Current assets, / think
did either the Union Pacific or the
Oregon Short Line borrow money to
make the purchaser"
NO, / think not"
did the Oregon Short Line declare
a dividend of 80 per cent on its stock
nearly wipe out its Sl6,0O0000 surplus?"
THAT was an accumulated dividend
and the surplus was surplus of opera
tions--not from the sale of securities"
The witness said the Union Pacific
held stock In the Pacific Mall Steam
ship company.
He was asked whether Mr.. Stubs,
director of traffic at Chicago for the
Union Pacific railway, did not also act
for the Southern Pacific, the oregon
Short Line and the Oregon Railway &
Navigation company, and he said he
did.
Mr.. STUBBS' SALARY.
How is his salary apportioned?
His salary as well as that of the 9TH
er representatives of the four COM
panies is divided among the companies
according to the gross receipts Of the
company"
''Who employed you?"
1.-THE chairman of the board
you mean Mr.. Hartman, don't
you?"
Yes"
Your salary is apportioned?"
Yes"
"Who directed you as TO the method
of apportioning of salaries?'
Jt,St
did Mr.. Hartmann"
~ don't know that he did"
well, who directed you as to the
division of other salaries?"
My impression is that II was done
through Mr.. Young, the general au-
ditor."
Commissioner Lane wished to know
whether there had been any resolutions
of the board of directors authorizing
the purchases of stocks shown in evil
dence.
Counsel for the commission said such
resolutions had been passed and would
be introduced.
STATEMENT FOR DIRECTORS.
Mr.. Mahl was instructed to bring be-
fore the commission tomorrow the
statement he prepared for the directors
of the Union Pacific and on which they
declared dividend last August. He
agreed.
Oregon Short Line and the oregon
Railroad & Navigation company
come into the treasury of the Union
Pacific?"
"In the shape of dividends.
"Out of these dividends, then out of
the surplus earnings and out of the
dividends received from other stocks
held by II, the Union Pacific pays its
dividends?'
Eyes"
Commissioner Lane asked If profits
had been made by the Union Pacific In
any of it's stock transactions,
II can't recall" said Mr.. Mahl. If
there were any they were probably
small"
What is done with the profits?"
'grhey are subject TO the order Of
the board of directors?"
money, invest 1t In stocks, and make a
profit. that profit is held subject to the
pleasure of the directors?"
II think SO"
LAS a matter of fact. didn't the
Union Pacific buy these Alton and 9TH
err shares out of the profits derived from
sales of the Northern Pacific and other
stocks of that group"
From those and possibly Others"
BOOKKEEPING SYSTEM.
Have you any entry on the books
that would show?'
II believe not; we merely have the
cash transactions"
You were recently comptroller OF the
Chicago & Alton?"
II believe so, sir"
Mr.. Millar, secretary of the Harri-
man lines, was then recalled. He was
asked to give the Offices of the Pacific
Mail Steamship company. He said e.
Fl. Hartman was president and that,
generally speaking. the officers were
the same as those of the Union Pacific.
The Southern Pacific controls the
Pacific Mail. doesn't it,"
YES"
Mr.. Millar was asked to read the Of
acers of the Portland and Aslatlc
Steamship company, They included Mr..
Hartman as president and other Union
Pacific officials.
Does the Union Pacific control the
Oriental and Occidental?"
ut owns one-half the stock"
"Who owns the other half?"
MOSTLY individuals"
Doesn't the Southern Pacific own
a part OF it?"
"Yes."
Then the Union Pacific and the
Southern Pacific together control tho