The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-02-18
woaId Know Pront Made.

Pacific Railway Company.
womId Know ProNt Made.
Second. the amount OF profit made by
the promoters OF such transactions, the
banks and other financial institutions con-
nected herewith. and the effect of these
transactions upon the financial status Of
the Chicago. Rock Island and Pacific Rail
Rod Company.
Third. the nature OF all properties ac-
CURED by any of the companies named
above AFTER the organization of the two
holding companies, In addition to the prop
critics that the Rock Island Railway then
owned. the cost of the same. and II any
portion thereof has been since sold tine
price obtained therefor; whether the ac-
quisition OF such properties has been TO
the financial benefit OF the Rock Island
Railway Company or otherwise. and, In
general, how the public has been affected
thereby.
Fourth the amount spent annually BY
the Rock Island Railway Company after
It came under the control OF the two hold
ing companies for equipment and main
tenance OF way. and what proportion the
amount 30 spent bears to the amount so
spent by other railways similarly sit
uated for the same purposes.
Fifth. the condition OF the equipment
Of the Rock Island Railway Company, the
quantity of such equipment Ill proportion
10 tnC netus pI inc COMPANY lot
service to the public, the ownership of
the equipment. the condition of the tracks
and way OF the company. and whether the
Rock Island system liz reasonably safe for
travel
"Sixth. the increase In the funded and
other interest bearing debt of tn. Rock
Island Railway Company for each year
since it has been controlled by the two
holding companies the amount OF net
earnings. fixed charges and capitalization
per mile for each year during such period.
Seventh. what interest, If any. persons
connected with the promotion OF the two
Rock Island holding companies and what
interest any of the officers OF those com
panies had IN the properties purchased
for the Chicago. Rock Island and Pacific
Railway Company subsequent TO the time
when the control OF that company was
acquired by the two holding companies.
Green Explains Purposes.
Representative Green when questioned
regarding the results he expects to OBJ
tain said:
"Some twelve years ago members of tho
so-called tin plate syndicate, including
Daniel @. Reid. Edward Is. Leeds and W
II. Moore, made IL great deal of money by
accommodating stocks in the various Tin
plate concerns. The promoters then
looked over the Chicago Rock Island and
Pacific Railway Company-then Il hin,
proft paying property. The road was
well kept up. its stock paid at . per cent
dividend and | believe that II the cor
poration had been well managed up to the
present time it's stock would be paying to-
day double that amount to the stock
holders.
THE three promoters organized two
holding companies about twelve years age
for the purpose of reducing to a com
paratively small amount the funds neces
sary TO control this system, The f'rs
holding company was called the Chicago
Rock Island and Pacific Railroad Com
pany. II was to buy and control th'
stock OF the Rock Island Railway Com
pany. The second holding company wal
called the Rock bland Company and wal
TO own and control the stock OF the Chi
cage, Rock Island and Pacific Rallwa!
Company.
'sThe Rock Island Railway Compan!
had about $4,000. 900 worth of stock q
that time. The promoters bought abou
1900, 900 OF this and against It they is
sued s71 100000 In 4 per cent. bonds o
the Rock Island Company. s71,00O,0 900 o
common stock OF the Rock Island Com
pany and S50,0OO.O00 preferred stock O
the Rock Island Company. This made
total OF about $1,000 900 of securitie
issued against the $71.O00,000 that tn
promoters started with. Without going int
the minute details, the promoters got al
tile money DdCh tHht they put UP lot III
stock Of the Rock Island Railway Com
pany and got many millions besides.
Deal Secures Control.
TN the operation they got what wa
most important to them, control Of tn
Rock Island Railway system through IN
preferred stock OF the Rock Island Com
pany Since obtaining control OF tn
Rock Island Railway Company they hav
fought and leased other lines and variou
kinds OF properties. including coal minei
and have enormously increased the fixe
charges against the Rock Island Railroa
Company so that now IT can hardly pa
the interest on the bonds.
Through their ownership OF the pre-
fcrred stock OF the Rock Island Coinpan
they control some 5000 miles OF railwa
with stock which was quoted last week d
u range OF from 10S to 1914, At III
quotations 100000 or $4,000 900 coul
now take control of the $50, 900. 900 OF pre-
ferred stock OF the Rock Island Compan,
Among the railroads purchased by u
Rock Island Railway under this manage
Alent of promoters waA the ST. Louis an
oAa Francisco. commonly called II
frisco system now In the hands OF ?,
coiyers The Rock Island Railway Con
pany sold It's holdings In the Frisco
1903 at loss vsrously estimated at fro
$4,000, 900 TO 10000. 900.
THE investigation asked seeks 10 a
"Srthin the nature OF other purchas
rn'oe 10y rhe Rock Island Hallway und
tines" prouutors and whether any OF II
officers of the company were financial
Interested In thegL"