The Bridgeport evening farmer., 1914-05-26
me steanas1hips

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 The sbeannshipa
 A. There was not any going around the circle. It was the straig htN st transAction there ever was in the world.
 @. Was the purchase of the steam ship property of the Navigation Com pany not simply subterfuge to ac- comp1ish the issuance Of the capital stock through the merger in order to give value ostensibly to the stock through the merger for the purpose of securing the stock of the Boston & Maine Railroad
 A. No sir: the purchase of the steamships by fhe Consolidated Rail- way was made at the price we had q cash offer from outside parties for the steamships. and that is the reason we fixed that valuation-
 @. What price was it
 A $2O, 900, 00O.
 c. From xhom did you get that cash offer
 A. That came to me from MT }, Morse, as it is in the records declined by the New Eleven Railway: {.
 @. $20, ,0Oo. 900 declined?
 A. Declined and that was great big mistake, too-
 O. Why did you decline it
 A. Because the directors voted. in their dgniert it was not wise to- sell, and it is matter of record.
 O. At whose instance was this of fer of s2o, ,o00. % declined
 A. I was the only man that stood for it. so it must have been at every body's instance voted for it, and then when found was a1one-I did not like to be aloneI like company, changed my vote and said we would make it unanimous
 Q. Did MT. Morgan object partic- 1lar1y to 1t?
 A Why, everybody was opposed. everybody. MT. Morgan was part of verybody.
 Could the New Haven Com pany at that time issue stock
 4 It could by consolidation.
 @. otheH than by generalization?
 Beating the Law.
 Under the laws of Connecticut it could issue no stock, as under stand it, except to be distributed to it's stockholders That was the only stock.
 e. This method was adopted to get out additional stock, was it2
 A. It was adopted for the purpose of changing Navigation and Consolt- dated Railway stock into New Haven stock. There was no additional stock created All the stock was Ie-
  ue, money properly invested in the en- terpr1ses that weere consolidated. As a matter of fact. the New Haven stock, so I think, represents much more than par paid in cash into its treasury.
 e. But not kept in the treasity very Iong7
 A All kept in the treasury ex- cept that sold to outside parties. and all sold to outside parties at q large premium
 e. suppose it represents more than par in cash paid in
 A Certainly.
 e. But there have been losses on account of these investments?
 A These losses would take off that profit, would take off that premium unless it was manifest.
 e. The New Haven could not in crease it's capital stock under the laws of Connecticut without distributing the stock among the stockholders of the New Haven
 A. am not a lawyer, but that is the understanding I have in my mind as a result of frequent consultations with. gentlemen of the legal profession.
 e. And this method was made to accomplish indirectly through this merger what could be done directly by an increase of the capital stock of the New Haven; is that correct
 Mr Robins Again.
 A. That may have been the case.
 o. Who advised this method of handling the matter?
 A presume it came from our le- gal department.
 O. MT. Robins?
 A. What date was it-1 BOT? Yes. MT. Robins was the general counsel, and it was undoubtedly done under his supervision.
 Q. What was the value of the Nav fgation Company stock and the Con solidated stock before the merger with the New Haven?
 4. The Navigation Company stock as repeated to you a few moments ago-as I stated to you a few mo- ments ago, had cash offer for of $20s000, GOO. That was it's value. The Consolidated Railway Company stock represented cash value for $1o,000, 1000. They were both in the treasury of the New Haven Railroad. As the <esult
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