Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1913-05-03


Republican National campaign fund
and other amounts to aid Republican
state campaigns in New York, Con-
necticut and Rhode Island.
Mr.. Mellen advanced the money and
the Railroad Company reimbursed HIM
Mr.. Mellen made this statement:
THE transactions by which 1885
shares OF New Haven stock were sold
TO me in March, 1904, and l gave my
notes to the New England. Naviga-
tion Company:
This stock was treasury and he'd
to be listed on the stock exchange in
Order to be sold to the public.
In erotr. 10 list it, it was sold to
ne ali save my notes TO the con-
lany which held the stock as eollater-
~ un-l sole
All the shares were sold at the
Lest obtainable prices and the entire
proceeds together with the dividends
paid to the company's treasury.
THE company received approx
mately 100000 more than the price at
which the stock was sold to me.
. THE transaction was bona fide and
at the time it was made without any
expectation that any excess over the
selling price to me would be realized.
Between the time of the sale to me
and the closing of the transactions,
had personally disbursed out of my
own funds considerable amounts ex-
ceeding in the aggregate the sum of
$102, 900.
These expenditures I had made not
for my own purposes, or in any way
for my personal advantage but alb
solutely because I was president of the
New Haven Railroad.
At that time, 1904, corporate con-
-tributions to campaign funds We're.
customary and not illegal.
Such contributions have not been
made since 1904 by the New Haven
Railroad through me or. so far as l
know, through anybody else. 49,
In 1904, | contributed $4,000 to the
National Republican campaign fund
and other sums for the Republican
campal gns in New York, Connecticut
and Rhode Island. among these $1,000
transmitted through Mr.. auckland.
Because was president of the New
Haven Co. have been constrained to
make these disbursements out of my
private funds. which as a private in
dividual, never would have made.
"On the closing up of the sale of
these stocks, it appearing that an un-
expected profit had been realized. my
directors who had been eognizant of
my contributions, for these purposes,
though proper to make me this allow
ance.
personally received or retained one
dollar to my own profit or advantage.
All the transactions were fully ex-
planned to the auditing committee and
were satisfactory to them, as ex-
penditures in furtherance of the COM
pany's interest and protection of its
II the Billiard Company should
have occasion to realize upon its as
sets, 1t would have to make a large
discount from the face value of these
securities which it owns, whereas the
New England Navigation Company,
not being obliged to realize and be-
ing able to watt. will undoubtedly
realize par. The difference between
the two situations Of the Billiard Com
pany and the New England Navigation
Company is such that I think it will
oPPSdA " lny llcl 8IO Has ildu eS-
perience in financial transactions.
wish. however, to say this, ana
this is air can say. speaking for the
future. that when this transaction -
all completed it will be found that
while Mr.. Billiard has received the
protection which is his due after hav-
ing taken the great risk that he did
in the initial transaction. he will hot
have received as not profit any more
than his worst. enemy would say he
was amply entitled to.
1t must be remembered that the
disposal of the New England Invest
ment, and Security Company notes TO
Mr.. Billiard for Boston & Maine stock,
seemed important to the company be-
cause from the state of opinion in
at that time it appear
ed to be desirable to get rid, some
how, of all securities of that nature
which had been acquired at a time
when the law in Massachusetts, was
supposed by the company to be in ac-
cordance with long practice rather
than with an unexpected decision OF
the Massachusetts supreme court ami
it must also be remembered that these
securities were difficult to market. par
ticularly because, at that time the
right OF the New Haven railroad 10
guarantee them was somewhat ques-
toned" =,
This Us an entirely. erroneous as
sumption. An accountant who is who'll
ly bookkeeper. may be excused for
not paying attention to anything ex-
cept nominal values as stated on books.
Every experienced man of business
knows. however, that book values are
not always the same as actual values.
Mr.. Brown found that Mr.. Billiard
received for the Boston & Maine stock,
notes of the New England Investment
& Security Co., which on the books of
the New England Navigation Co.
were valued at par to the amount Of
SIG. $50, 900.
Those notes bore interest for the
first five years at the rate of per
cent, for the second period of five
years at 4 per cent, .apd for the third
period OF five years, at 5 per cent. The
actual market value OF those notes
was much less than this book value of
s16,250, 900. From Mr.. Billiards. point of
view what he was receiving was worth