246 



Vs 



THE INDIA RUBBER \A/'ORLD 



[Mav I, 1902. 



" KEENE interests" SEEK CONTROL. 



The tenth annual meeting of the stockholders of the United 

 States Rubber Co., for the election of directors and for the 

 transaction of any other business which may properly be brought 

 before the meeting, will be held at the office of the company, 

 in New Brunswick, New Jersey, on Tuesday, May 20, at 12 

 o'clock, noon. The transfer books were closed at 12 m. on 

 April 19 and will reopen at 10 a. m. on May 21. Following the 

 call for proxies, by the management, the letter below was re- 

 ceived by the stockholders: 



TALBOT J. TAYLOR & CO., 

 BANKERS AND BROKERS, 



30 Broad street, New York, April lo, 1902. 



To THE Stockholders of the United States Rubber Co. : As 

 you are doubtless aware, the United States Rubber Co. has been en- 

 gaged during the past year in a price war with competitive rubber com- 

 panies, in consequence of which dividends have been suspended on the 

 stocks of your company. 



We believe that this state of things should no longer be permitted to 

 continue, and are assured that under proper auspices a working agree- 

 ment can be devised whereby this ruinous competition among the dilTer- 

 ent rubber companies will cease. 



We and our associates are now in control of the Rubber Goods Man- 

 ufacturing Co., and we confidently believe that if the same interests 

 are put in control of the United States Rubber Co., such a cooperation 

 between the different companies can be arranged as will greatly add to 

 the value of your stock. 



If you should desire to vote with us, please send us the enclosed 

 proxy, properly signed and witnessed. Yours very truly, 



TALBOT J. TAYLOR & CO. 



The proxies read in the names of Talbot J. Taylor and James 

 B. Taylor. Upon the appearance of this letter, the following 

 second communication was issued from the offices of the United 

 States Rubber Co. : 



New ^'oRK, April 11, 1902. 



To THE Stockholders of the United States Rubber Co. — Gfii- 

 tlemen : A circular letter has been addressed to the stockholders of the 

 United States Rubber Co. by Messrs. Talbot J. Taylor & Co., of the 

 New York Stock Exchange, asking that proxies be sent to them, in or- 

 der to put themselves and their associates in control of the United States 

 Rubber Co. in place of the present board of directors. 



To avoid any misapprehension as to some points of the circular, the 

 management feels it to be its duty to stockholders to make the following 

 statement : 



1. There is no competition between the Rubber Goods Manufacturing 

 Co., to which the circular refers, and the United States Rubber Co. 

 The United States Rubber Co. is interested in the manufacture and sale 

 of rubber boots and shoes, while the Rubber Goods Manufacturing Co. 

 neither makes nor sells boots or'shoes, but other rubber goods only. 



2. By the unanimous vote of its directors, about a year ago, the United 

 States Rubber Co. reduced prices in order to meet rapidly growing com- 

 petition in the manufacture of boots and shoes. The result of such re- 

 duction has been the abandonment of several companies which at the 

 time were proposed, or which, having been organized, had not started. 

 Three companies then manufacturing rubber boots and shoes have since 

 gone out of the business, and others have curtailed their operations. 

 While this has been the experience of outside companies, the United 

 States Rubber Co. and its subsidiary companies have increased their 

 gross sales of rubber boots and shoes from 1528,550,470.62 for the eleven 

 months ending February 28, 1901, to $44,855,384.78 for the eleven 

 months ending February 28, igo2, realizing therefrom prices not far 

 from cost. 



3. Recently the management of the United States Rubber Co. has 

 funded the entire indebtedness of the company and its subsidiary com- 

 panies, thus placing them in a thoroughly independent position, and 

 enabling the introduction of economies not possible so long as there was 

 floating indebtedness requiring continuous attention. The fact that this 

 funding could be accomplished during the time which in the circular is 



termed a period of " price war," would suggest that strong financial in- 

 terests have confidence in the present management of the company and 

 its future stability and prosperity. 



4. The present board of directors comprises men who during the past 

 half century built up the rubber boot and shoe industry in this country, 

 and have brought to their present state of efficiency the " Boston Rubber 

 Shoe Co.," the " Goodyear's India Rubber Glove Manufacturing Co.," 

 " L. Candee & Co.," and other subsidiary companies of the United States 

 Rubber Co. Very recently, there has been added to the board four di- 

 rectors considered to be satisfactory to all stockholders, including those 

 issuing the circular referred to. 



The question therefore, for the stockholders to decide is : Will they 

 support the present board of directors, composed as it is, and permit 

 them to place the company on a solid foundation where it will earn per- 

 manently fair returns for its stockholders, or will they undo that which 

 at much expense and sacrifice has already been accomplished in regaining 

 in large part the rubber boot and shoe business of the country, and turn 

 the control of the company over to gentlemen who certainly have had 

 no experience in the rubber business, and whose promise of relief de- 

 pends upon the formulation of a working agreement, which in their 

 circular is declared with a frankness as unusual as it is dangerous, to 

 be intended to suppress competition ? Respectfully, 



Samuel P. Colt, President. 



Costello C. Converse, Vice President. 



James B. Ford, Treasurer. 



Lester Leland. Second Vice President. 

 From a Boston source the suggestion is made that if the 

 Keene interests succeed in gaining control of the United 

 States Rubber Co., not a director of the company who is iden- 

 tified with the rubber industry will remain on the board. Of 

 the present directors, ten are rubber manufacturers. Then 

 again, the retiring directors would immediately sell their stock 

 for what it would bring, feeling that the business cannot be 

 made a success except on the lines already laid out. " But the 

 most important factor in case of the success of the Kecne in- 

 terests would be that ten of the leading rubber shoe manufact- 

 urers of the United States would be out of employment and 

 naturally they would seek to reenter the business with which 

 they have been familiar for years. The result would be an in- 

 crease in the number of independent plants rather than a re- 

 striction of competition. The Keene interests are endeavoring 

 to make it appear that J. P. Morgan & Co. are supporting them 

 in their efforts to get control of the company. Such is not the 

 case." 



It is not understood that the United States Rubber Co., or 

 the constituent companies, owe as much as $12,000,000 in float- 

 ing debts. The sale of the funding notes, which are reported 

 to have been subscribed for within a few days after being of- 

 fered, was meant, not only to retire all existing floating indebt- 

 edness — such as has existed at times from the organization of 

 the company — but to reduce the rate of interest, and likewise 

 provide for future working capital on more convenient terms 

 than hitherto. The funding notes will not all be issued at 

 once, but as money is needed in the operation of the factories, 

 and will not bear interest before actually issued. It is regarded as 

 probable that the financial interests underwriting this issue will 

 exert their influence in behalf of the present management and 

 policy of the company, in any contest for control at the com- 

 ing election. Another point of strength for the present man- 

 agement is that the Converse and Ford interests alone, on the 

 board, are said to hold a fourth or more of the company's 

 shares, so that not more than another fourth need be controlled 

 to prevent a change of management. The opposing interest 

 would seem to have, to begin with, a much smaller holding of 

 shares, with the consequent necessity of gaining the adhesion 

 of a much larger voting strength in order to control. 



