The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1907-02-12


But the most striking feature of the
bill is the absolutely arbitrary power
given to the railroad commission. No
rule whatever is laid down to govern
the commission in reaching a decision
1t is given the uncontrolled power to
capital for the lawful purposes of the
railway company, the implication
therefore being that it is important
that such application should at times
be refused Railway companies are by
statute authorized to do certain things,
but if this bill becomes law, the rail-
road commission would be authorized
to prevent the doing of those things by
refusing to authorize the raising of
necessary capital. / believe the bill in
effect attempts what is probably an
unconstitutional delegation of legisla
tive power to the railroad commission.
This bill would operate to discredit
and consequently destroy the value of
the stock. 1t seeks to make of the
state auditor the registrar and trans
fer agent for all stocks and bonds is
sued under its provisions. AS bust
ness proposition the scheme is imprac-
ticable. The stock of railway com
pany is continually changing hands
Z ID we daily rewrite stock certificates
for hundreds and hundreds of shares.
Serve No Useful Purpose.
LAS to all of these bills, and any bill
of like character: what possible useful
purpose can they serve? Neither the
AtchiSon company or any other railway
company operating in your state is
seeking to do anything which is con-
trary to the policy indicated by the
bills. Their immediate practical effect
would be to introduce indefinite delay
and uncertainty in providing additional
transportation facilities which are
urgently needed by the public and the
railroads if they are to properly serve
the public.
There probably has never been
time of less need for supervision of in
creases of capital stock or bonded in
dsbtedness of railway corporations, be-
cause the proceeds now derived from
such increases of capitalization are
more scrupulously devoted and honest
" applied to the lawful corporate pur-
poses of those companies than ever be-
fore However, the only supervision
that is-or ever was-necessary or eX-
pedient is merely to see that new cap
ital is used honestly for lawful cor
porate purposes These real objects OF
supervision are very inadequately dealt
with by these bills, which instead de-
vote themselves principally to provid-
ing a way for the absolute prevention
of the raising of new capital, which re-
suit would not be in the public interest
IF the impression prevails that be-
cause the stockholders of the Atchlson
company have by vote authorized an
increase in the capital stock or hondS
of that company, that no legislation OF
the kind the legislature is now consid-
ering would interfere with its plans
and make impossible the raising OF
additional capital by it, wish now to
dispel that impression We have not
as yet pat out the new stock or ponds
may be decided upon
and in all proba bility it may be the
first of April before we can do so be-
cause of the things necessary to be
first done. We will, within the next
week or ten days, as soon as the
document can be completed, file with
your secretary the certificate of our
directors showing the authorized in
crease of stock. If such new stock or
Il convertible four per cent bond is to
be given to our present stockholders,
we must mail to each notice OF their
rights, with subscription blanks to be
used in subscribing for their prorate
shares of such stock or bonds, and we
must set ahead a date when those
rights will attach and the payments
Hereunder become due.
100 Millions in Ten Years.
1.-The management of the Atehison
company during the last ten years has
worked hard to develop the system
and to enable it to meet the public de-
mand for adequate transportation.
We have raised and have spent more
than one hundred million dollars of
new capital upon the property, and l
am confident that we have obtained
this money by the most conserva tive
and most careful methods of financing.
The Atchison directors nave heSer
sold anything to the company nor
bought anything from the company,
nor have they been personally inter-
ested in any of its financing, but on
the contrary have at all times endeav-
cred to secure the best results for the
company. We now require about
million dollars of addi-
tionaI capital for the purpose of i'm
proving our present railroad, paying
for large additions to equipment and
for new construction. There is no
other way for us to obtain this money
than by selling our common stock or
our four per cent convertible bonds at
par. The market price of our COM
mon stock during the last ten days has
fuctuated between 80 and los. 1t
was quoted at 103 at the close of the
market on Saturday and under pres
ent market conditions we could not
possibly sell even a small part of this
twenty-five million dollars of stock or
bonds at par. Our only hope of rails
ing the money is that market condi-
lions will improve sufficiently to en-
able us to put out the stock or bonds
at par and this means that our stock
higher price than at present. As
things stand today we should be quite
ready to pay bonus of five hundred
thousand dollars to any one who
WOULD lake tnlS twenty-five mllllOn OF
stock or bonds at par. If this money
is to be raised we must seize the first
market opportunity that offers and If
we can not act instantly when that
opportunity presents itself we may not
be able to raise the capital at all.
"If, then, we are first required to
obtain of your railroad commission
to put out these additional
securities. much time will be lost and
no one can predict what the effect
upon the market for our securities
will be- We do know, however, that
this present agitation in your state has
already had a paralyzing effect and
unless we shall be in a position to act
within the next thirty days there will
be no alternative but to stop extern