New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-06-10
MAGAZINE HAD S63.98
Former Treasurer Tells Of Co.
lumbar Sterling Merger.
WESTERN CONCERN BROKE
Witness at Fraud Trial De-
scribes the Consolidation
Without Inventory.

Alfred /. Smith. former treasurer or
the Western Magazine Publishing Com
pany. testified yesterday in the United
States District Court that on June J.
1911. at the time Of tho consolidation with
tho Commissioning Publishing Com
pany. several Of whose officers are now
on trial for fraud and conspiracy the
cash balance ~ the absorbed concern was
,63 %. Tho witness also said the merger
was effected without the formality OF an
inventory Of the plant.
Mrs. Zipha T.. Perkins. ~ Shrewsbury.
Mass. who with her husband had been
summoned as witnesses. in an effort 10
show the defendants had made false
statements regarding tho earnings NJ the
Columbian Magazine Company. testified
that she bought lno shares at par value
Of 81 and received only ono small diyi-
dend after the merger with the Column
transferring COMPANY
Her husband told how he bought l2o
shares Of stock I'm the consolidated con-
Germ and never got a cont I'm dividends
Bert Murphy Philadelphia printer.
was another investor in the merged COM
itIf v ITO if''lf "a lI'iI.|IINf iIf HtlAt VII
hts investment.
After brief Identification - the books
containing tho accounts ~ the Western
Magazine Publishing Company Mr.. Smith
went on tho stand and related tho story
n tho transaction by which that COM
rauy Was absorbed hv tho defunct East
crn concern.
Before tho consolidation. he said II
met Mr. Yates and Mr. orr. president 81
the Misunderstanding COMPANY. In our
ST Louis Offices Yates said there was
going to be- consolidation. and con-
tinuod. We have sold q lot 81 stock
and must make q fine showing 70 tho
stockholders AZ tho meeting We must
Gr 1t M somehow ! said 7 wouldn't do
anything unless they would take on tho
obligations Of my company. which were
about $40. N They replied that that was
all right. because they had two maya
zines and 5000 I'm bank
no inventory was taken ~ the plant
We walked through tho offices and then
tho plant. and showed them what We had
orr and Yates went back % New York.
but several days later We got a letter
written on the stationery OF tho Column
bian- Sterling Company which said:
go inclosc a form Of contract between
tho columbian Magazine Publishing Com
pany and tho Western Magazine Publish
ing Company. and another with the CO.
lumbar Magazine Publishing Company
and tho Columbian Sterling Publishing
Company. These contracts are more or
less a formalty. but We consider IL advis-
able that II be done this way. The papers
are for the purpose Of showing a proper
legal consideration for issuing stock"
Mr. Smith said that orr then wrote
letter urging him to stay I'm 81 Louis and
entertain the stockholders I'm your own
nice manner and tell them how much their
stock is worth now the Columbian Sterling
has been formed"
Smith testified that he also was In
structed 10 use the name Of "IIampton's
Magazine very freely when talking with
stockholders.
Later. when he came TO New York rs
secretary OF tho Columbian-S Sterling Pub
fishing Company. Smith said, Off told
him he was disappointed because "IIamp-
TONS" had not Offset deficiencies from
the other magazines. When he asked
about the source Of the I per cent quar-
terly dividend. Smith testified John f. &.
Atkin. Of's adviser and one of the men on
trial. replied that he had capitalized each
department and from that got a surplus
from which to pay dividends.
He gave assurances. Smith asserted
that the procedure was strictly legal and
had been passed on bv the Supreme
Court Smith said that when he resigned
from the company Akin told him that It
was running behind at the rate OF 900
a day.