THE next morning at ten o’clock, Major Buell
Hampton walked down to the smelter office. He was met at the door of
the directors’ room by the general manager, Mr. W. B. Grady. Despite a
bold front Grady looked careworn and anxious.
“Hold on there,” he said as the Major started to enter. “What do
you want?” He spoke roughly. “This is a meeting of some gentlemen
who are interested in the Smelter.”
“Very well,” said the Major. “I came down to attend the
stockholders’ meeting.”
“Well, you can’t go in,” said Grady. “Stockholders’ meetings
of this company are private. We do not furnish entertainment and gossip
for onlookers like a justice of the peace court.”
“That may all be true—I hope it is true, Mr. Grady,” said the
Major, and he looked him in the eyes with more of pity than of anger
depicted on his face. The crafty manager cringed before the critical
inspection.
“I am here strictly on business,” continued Buell Hampton. “I am a
stockholder.”
“You a stockholder in our Smelter Company?”
“I have that honor,” replied the Major, tersely. “Or at least I
hold powers of attorney from the largest group of stockholders in your
company.”
An ashen grey crept into Grady’s face.
“What do you mean?” he faltered. “You are not a shareholder of
record on our books.”
“No, but you will find as shareholders of record the names of Charles
T. Brown, George Edward Reed, Herbert Levy, Daniel W. Higbee, and a few
others about whom I need not bother.”
A new light broke over Grady. He looked more sickly than ever.
“These are recent purchasers of stock,” he said, “in New York and
also, if I remember rightly, in Iowa.”
“Precisely, and together these buyers now hold the controlling
interest in your company. Here are the legal documents constituting
me the attorney for all these men.” He drew a neat little packet of
papers from the breast pocket of his coat. “In other words I am
these men—I hold the controlling power, although I did not choose to
disclose the fact until this morning. Now, will you please let me pass?
Thank you.”
If a pistol had been thrust against the ribs of W. B. Grady, he could
not have looked more utterly scared. He had stepped aside to let the
Major pass and now bluff and bluster changed swiftly to sycophancy.
“All right, Major Hampton,” he said, in his most ingratiating
manner. “Walk right in and let me introduce you to some of the other
stockholders. Of course, only a few of them are here.”
The Major followed him into the directors’ room and was duly
presented.
“This,” said Grady with patronizing suavity, “is an old fellow
townsman of ours here in Encampment and a friend of mine. Here, Major,
take this chair,” insisted Grady. “You see we are all a happy family
together.”
Major Hampton could not but contrast the fawning manner of the general
manager before his superiors, the directors of the Company, with his
notoriously overbearing and insolent treatment of the workingmen.
“Well,” said the chairman, “fortunately we have a very good
manager.”
“Thank you,” said Grady with increased affability.
“For myself, I am pleased and delighted at the general manager’s
report which I presume it will be in order now to have read. I think we
have all seen it in advance.”
The Major shook his head in dissent but made no comment.
Thereupon the meeting was called to order, and after the preliminaries
were concluded Mr. W. B. Grady proceeded to read a rather brief but very
interesting annual report.
His report was not only a business summary of a most successful fiscal
year, but also abounded with more or less veiled laudations of himself
in his capacity of manager.
Attorney Wm. Henry Carlisle, who combined with his legal position a seat
on the board of directors, advised that the election of a directorate
for the ensuing year was in order. By this time it was known to the
other shareholders present that Major Buell Hampton owned or represented
a control of the stock. This rather upset the cut-and-dried program.
W. B. Grady, addressing the chairman, said that he presumed Major
Buell Hampton would appreciate being elected a member of the board of
directors, and if the Company’s attorney, Mr. Carlisle, did not object
perhaps it would be well for him to vacate his seat so as to make room
for the new incumbent.
Carlisle’s face grew very red at this attempted slight but he said
nothing.
Major Buell Hampton arose, and addressing the chairman said: “Since I
have acquired control of the stock of this Company, I have decided that
Mr. Grady shall not be re-elected as a director. But in the first place
I wish to ask of all stockholders present what their intentions are
regarding the declaring of a dividend?”
With this he resumed his seat.
By every lineament on Grady’s face one could see that he was furious.
“I presume,” said the chairman, “that it would be proper to follow
the suggestion of Mr. Grady, our general manager, and declare a dividend
of seventy-two per cent on the capital stock.”
Major Buell Hampton, again addressing the chair, remarked that
seventy-two per cent, was certainly a fat dividend. But for himself
he had purchased a control of the Company’s stock for the purpose of
introducing some innovations in its management, and in order that there
might be no misunderstanding he felt it was now proper to present his
views. If any of the directors were not in harmony, why, of course, it
would be inadvisable for them to stand for re-election to a directorate
over which he intended henceforth to exercise a close supervision.
“I now wish to ask the directors of the Company this question,”
added the Major. “What about Boney Earnest’s dividend?”
He paused for a reply.
For a moment the stockholders and representatives of stockholders
present seemed almost dumfounded. They turned to the manager, Mr. Grady,
who answered the Major by saying he did not know that Boney Earnest, the
dismissed blast furnace foreman, was a stockholder or had any investment
in the concern—“it was all news to him,” he added with a weak
attempt at levity.
Major Hampton had remained standing, and by silent consent all waited
for him to reply to this statement.
“Yes, gentlemen,” he said quietly, “Boney Earnest may not be a
stockholder of record. But all the same he had his all invested in this
smelting plant. Day after day, during year after year, he stood before
the blast furnace, doing work of a class which few men could endure. It
is true he received a daily wage until the date of his dismissal, but he
had invested in addition to his daily duties almost a life-time of ripe
experience in the particular work he was doing for this concern.
In short, he had his all—his strength, his brain and his
experience—invested. In these circumstances I object,” continued
Major Hampton, “to a dividend of seventy-two per cent. I notice
from the manager’s report that he has made ample allowances for
betterments, replacements, and surplus, and even with all these very
proper provisions, the enormous possible dividend of seventy-two per
cent, still remains. An original capital stock of $500,000 and an annual
dividend of $360,000, certainly is a magnificent showing.”
Buell Hampton paused and all present clapped their hands gleefully, as
if the Major was coming around to their way of thinking.
After silence was restored he proceeded: “Money is worth probably
from five per cent, to six per cent, per annum on solid, non-hazardous
investments and at least double these figures or more on mining
investments which must be regarded as extremely hazardous. It is not,
however, worth seventy-two per cent. per annum. Therefore, gentlemen,
we will declare a dividend of six per cent, on the capital stock, which
will require $30,000. We will then add the capital stock to the pay
roll. The pay roll for the last year in round numbers is $1,100,000. The
capital stock is $500,000 or a total of both of $1,600,000. We will then
declare the remaining $330,000 of earnings into a dividend on the entire
$1,600,000 of capital stock and annual pay roll combined, which amounts
to a little over twenty per cent. This will give to the shareholders
of our company’s stock a little more than a twenty-six per cent,
dividend.”
The Major sat down. Consternation was apparent on every countenance.
“Major,” said one of the eastern directors, “may I ask you what
would happen and what you would do in carrying out your altruistic
dream if the earnings did not amount to even six per cent, on the money
actually invested?”
The Major arose again and with great politeness replied: “Probably
we would not declare a dividend. If we had but $30,000 that could be
legitimately applied to dividend purposes, the amount would belong to
the stockholders. But anything above this preferred dividend to the
shareholders should be declared on the annual pay roll combined with
and added to the capital stock of the company, both classes of investors
participating in the surplus over and above six per cent, preferred
dividend. The question with me,” added the Major, “is this? How many
of you directors are in sympathy with the suggestion I have made?”
There came no answer, and he continued: “A while ago I expressed
myself against your manager for a position on the directorate. I always
have a reason for my decisions. It has come to me,” continued the
Major, “that while the original cost of this plant may have been
$500,000 yet by the wicked manipulation of the ‘system’ the original
shareholders were completely frozen out—legally robbed if you please,
of their investment and it is quite probable the Pennsylvania crowd, the
present owners or at least those who were the owners before I purchased
a control, paid very little in real money but much in duplicity and
ripened experience in the ways of the fox and the jackal. I have learned
on excellent authority that Mr. W. B. Grady, by stealth and cunning,
secured the underlying bonds from one of the former builders of this
great plant, and robbed him and left him penniless in his old age.
Unless other means of restitution be devised, the reimbursing of those
stolen sums out of my private purse will be one of my first duties and
one of my greatest pleasures.”
Grady rose, his face flushed with passion. But Buell Hampton waved
him down with his hand and calmly proceeded: “I will state another
innovation. There are seven directors who control the destinies of this
company. I now insist that the company’s attorney shall be instructed
to have the by-laws so amended that the head of each department,
beginning at the mine where we extract the ore, then the tramway which
carries the ore to the smelter and all the various departments in the
smelter including the converter—shall be elected annually by the
workers themselves in each of the seven departments. In this way there
will be seven foremen; and these seven foremen shall be officially
recognized by the amended by-laws of this company as an advisory board
of directors, entitled to sit and vote with the regular directors at
each monthly meeting and likewise with the stockholders in their annual
meeting.”
Had a bomb-shell been thrown into the stockholders’ meeting greater
consternation could not have been evinced’. Finally Attorney Carlisle
moved that an adjournment be taken until ten o’clock the next day, at
which time the stockholders would re-assemble and further consider the
unexpected and doubtless vital questions now under consideration. The
motion prevailed.
Of course the entire matter hinged first of all upon the election of
a directorate. During the adjournment Attorney Carlisle, peeved at
Grady’s readiness to drop him from the directorate, called on Major
Hampton and assured him he was in accord with the views he had expressed
and that his every suggestion could be legally complied with by amending
the by-laws.
Buell Hampton, however, did not take the hint implied. He was courteous
but firm. The old régime had to go—the management must be changed,
lock, stock and barrel. Therefore there could be no further utilization
of Mr. Carlisle’s services as attorney for the company. Baffled and
discomfited the lawyer withdrew. He was full of indignation, not against
Major Hampton, but against Grady, for he had warned the latter against
selling a certain block of stock to part with which had jeopardized
control of the corporation. But Grady, in need of money, had replied
that there was no risk, the buying being sporadic and the existing
directorate in high favor with the stockholders because of its ability
and readiness to vote big dividends.
Grady had little dreamed that already considerable blocks of the stock
had passed, under various names, into the control of the Keokuk banker,
Allen Miller, to whom he had some time before mortgaged his Mine and
Smelter Company bonds, and who had reasons of his own for displacing
Grady and crippling him still more badly in his finances. Nor had he
sensed the danger that the scattered sales of stock in the East had been
in reality for a single buyer, Major Buell Hampton. Therefore he had
been caught quite unprepared for the combination of forces that was able
now to throw him down and out at the first meeting of stockholders. For
once the fox had slept and had been caught napping in the short grass,
away from the tall timber.
Carlisle had of late been too busy “doing politics,” and had allowed
matters to drift even though he had seen possible rocks ahead. Now the
two old-time confederates were blaming each other—Carlisle denouncing
Grady for parting with the stock control, Grady upbraiding Carlisle for
neglect in not having taken steps to discover who were the real buyers
of the shares being gradually transferred on the company’s stock
books. The blow, however, had fallen, and there was no means of blocking
the transfer of power into new hands.
When the stockholders’ meeting reconvened the following morning, Major
Buell Hampton submitted the names of five men whom he desired on the
directorate. They were—Roderick Warfield, Grant Jones, Boney Earnest
and himself, together with Ben Bragdon, who would also take up the
duties of attorney for the company. This left only a couple of places
to be filled by the eastern stockholders. Two names from among the old
directors were offered and accepted. Indeed the selection of directors
became a unanimous affair, for seeing themselves utterly defeated both
Grady and Carlisle, glaring at each other, had left the room.
Major Hampton’s views on corporations and dividends, and his new plan
of management for the Smelter Company spread all over the camp with
astonishing rapidity, and there was general rejoicing among the miners
and laborers.
One employee in the smelter who had been with the company for some three
years made the discovery that, while he was receiving three dollars per
day, which meant an annual income to himself and family of $1095, his
dividend would bring him an extra lump sum of $219 annually.
When figuring this out to his wife he said: “Think of the pairs of
shoes it will buy for our kiddies, Bess.”
And the woman, an Irishwoman, had replied: “Bless the little
darlin’s. And hats and coats as well, not to speak of ribbons for the
girls. God bless the Major. Sure but he’s a wonderful man.”
Several workers sitting in a corner of the Red Dog saloon were
calculating with pencil and paper their annual dividends on the already
famous Buell Hampton plan.
“Boys,” said one of them after they had their several accounts
figured to the penny, “maybe we won’t make the dividend bigger next
year—what?”
“I should say,” responded another. “I’ll do at least twice the
work every day of the coming year, because there’s now an object
for us poor devils to keep busy all the time. We’re sharing in the
profits, that’s just what it means.”
“There’ll be a great reduction in breakage and waste,” remarked
another employee.
“The directors can leave it to us to make the next year’s dividend a
dandy one.”
These were just a few of the grateful encomiums flying around.
On the day following the stockholders’ meeting the newly elected
directors convened, all except Grant Jones, who was over at Dillon and
had not yet been advised of his election. After Major Buell Hampton had
been voted into the chair a communication from W. B. Grady was read,
stating that he wished to know at once if the directors desired his
services for the ensuing year; if so he required a written contract,
and should the directors not be ready to comply with this ultimatum they
could interpret this letter as a formal resignation. There was a general
smile around the directors’ table at this bluffing acceptance of the
inevitable. It was promptly moved, seconded, and carried unanimously
that Mr. W. B. Grady be at once relieved from all further connection
with the Smelter Company’s plant and business.
Major Hampton then explained that in accordance with his scheme the men
in the various departments would be invited at an early date to elect
their foremen, and these foremen in turn would have the power, not
to elect a general manager, but to recommend one for the final
consideration of the directors. Until a permanent appointment was made
he suggested that Boney Earnest, the blast furnace foreman dismissed by
the late manager because of a personal quarrel, should take charge of
the plant, he being a man of tried experience and worthy of absolute
trust. This suggestion was promptly turned into a substantive motion
and adopted by formal resolution. The meeting adjourned after Director
Bragdon in his capacity as company attorney had been instructed to
proceed immediately to the work of preparing the proper amendments to
the by-laws and taking all legal steps necessary to put into operation
the new plan.
Thus neither mine nor smelting plant was shut down, but everything went
on without interruption and with greater vigor than before the momentous
meetings of stockholders and directors. The only immediate visible
effect of the company’s radical change in policy was Grady’s
deposition from the post which had enabled him to exercise a cruel
tyranny over the workingmen.
And in the solitude of his home the dismissed manager, broken
financially although those around him did not yet know it, was nursing
schemes of revenge against Buell Hampton, the man of mystery who had
humiliated him and ousted him from power.
Where was his henchman, Bud Bledsoe?—that was the question throbbing
in Grady’s brain. But Bud Bledsoe was now an outlaw among the hills,
with a price on his head and a sheriff’s posse ready at a moment’s
notice to get on his heels.
“By God, I’ve got to find him,” muttered Grady. And that night, in
the falling dusk, he rode out alone into the mountain fastnesses.