The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1913-06-12
TO SWAP STOCKS
Union Pacific Present New
Dissolution Plan.
Would Trade Southern Pacific
for b. & O. Stock.

|
road attorneys appeared before United
States Circuit Judges Sanborn, Hook
and Smith today and explained addi-
tional plans for disposing of the roads
holding of Southern Pacific stock At
torney General McReynolds on behalf
of the government expressed unalter-
able opposition to those plans which he
said were mo plans at all, but merely
were propositions of something they in
tended to try to do
| The court adjourned without an
| nouncfng any decision.
Presiding Judge Sanborn indicated
/ that no order might be expected until
| the attorney general had decided
whether the government would object
| to a proposed exchange of part of the
holdings of Southern Pacific stock for
| Baltimore and Ohio stock held by the
Pennsylvania railroad.
! McReynolds said he thought the gov
| ernment would not object to the pro-
posed exchange but he wanted to in
vestigate the holdings of the various
roads involved in the deal before MAX
ing any definite statement on the sub
/ ject. He told the court that he prob
ably could inform the court within
three or four days.
1.-THE time has come for the court to
order something to be DONE" said the
gument of the railroad lawyers. "The
Union Pacific does not even guarantee
to carry out either of the two so-called
plans now before the court. 1t asked
for year within which to try to ac-
complish one plan to dispose of the
stock provided market conditions with
in that time will permit such action
without loss to its stockholders.
1.-The attorneys for the railroad say
that to dispose of the stock at present
market conditions would be to do so
at a great sacrifice. If loss is incurred
it will be the result of wrongful action
as construed by the supreme court
which has ordered this court to dis
pose of the stock within reasonable
time. Approval of either proposition
submitted probably would find the sit
uation just as it is now at the END
of the year with the court still having
the stock to dispose off,
Judge Sanborn asked the attorney
general what action he thought the
court should take. Mr.. IIcReynolds
said that one of two things should be
done:
The court should either appoint a
receiver to undertake the disposition
of the stock or should itself devise
some means of disposing of it. The
primary plan proposed provided for
the sale of the stock by popular sub
scription, similar to city bonds, while
the alternate plan provided for placing
the disfranchise stock in the hands
of trustee and the issuance of GER
tificates of interest against it. These
certificates would be exchangable only
upon an affidavit that the holder did
not hold any of the capital stock of
the Union Pacific. Judge LoVett ex-
planned to the court that it would be
impossible to carry out the first plan
a the present time owing to the mar
ket conditions all over the world but
he thought the second plan could be
consummated in much shorter time.
st. Paul, June 12.-Attorneys for
the Union Pacific presented at the
opening of the merger dissolution
hearing today, new plan for the dis
position of s3S,000.0OO worth of
Southern Pacific stock to the Penn
sylvania railway in exchange for $21,-
100000 worth of Baltimore & Ohio
stock The new plan proposed was
supplemental to the two recently sub
mitted. The amount of stock involved
in the exchange represents only IA per
cent of the total Southern Pacific
Union Pacific in Southern Pacific
common stock represents about $685.
100000.
Attorney General McReynolds, in
Union Pacific, said that he regretted
that the railroads had been unable to
affect a deal whereby the Union Pa
cific would acquire the Central Pa
cific operating from Ogden to San
Francisco in exchange for it's Southern
Pacific stock. He declared that this
failure compels the government to in
stitute an expensive litigation to COM
pei the Southern Pacific to relinquish
it's hold over the Central Pacific.
Attorney General McReynolds ar
rived here today from Washington
prepared to appear before United
States Circuit Judges Sanborn, Hook
and Smith to oppose the latest plans
submitted for the dissolution of the
socalled Union Pacific merger. The
court set today for the hearing on
the plans, when they were presented
by the railroad attorneys for approval
last Thursday. Unless plan satisfac
tory to the court is offered by July 1, |
a receiver will be appointed to carry
out the supreme courts mandate for
the dissolution of the Union Pacific
and the Southern Pacific. Mr.. Nc
Reynolds is expected to express to the
court the governments contention
that neither of the two plans under
consideration will accomplish the de-
sired end. Attorneys for the railroad, |
including Judge Lovett, chairman of
the board, will present arguments in
support of their proposition which
they hope will overcome the objec-
tions of the attorney general and win
the approval of the court. The hear
ing was scheduled to begin at 10
o'clock and the attorneys We're hope
full that it would be concluded within
a few hours.
ST. Paul, June 12.-Court adjourned
without announcing a decision in the
Union Pacific dissolution matter.