Researcher Anton Chaitkin, the son of a Jewish attorney (Joseph Chaitkin) whose clients had invested in bonds issued by the Hamburg-Amerika Line, which had taken over the North German Lloyd steamship line. After Hitler came to power, Hamburg-Amerika stopped payment to the bondholders based on an order issued by Hitler, but actually arranged by John Foster Dulles and his friend Hjalmar Schacht, a German who had grown up in the U.S. and been educated alongside America's elite sons, but who returned to Germany to be Hitler's finance minister. Joseph Chaitkin filed suit in New York in 1934 on behalf of his clients and organized a boycott against trading with the new German government. His efforts were stifled by a number of investment bankers operating in the United States, ostensibly American patriots, but later accused of traders with the enemy. The research conducted by Anton Chaitkin into the coverup that ensued has been thoroughly documented in the book he wrote with Webster Tarpley called The Unauthorized Biography of George Bush. I have never been one who believes anything I read without investigation. After reading the book, I asked myself: "What is the best way to actually remove the veil that preserves the secrecy around the investments managed by the investment bank of Brown Brothers Harriman?" Is there anything I can do to find out what the real truth is? After learning of this alleged conspiracy which took place between the two world wars, and which was continued after World War II by the rise to power of both Dulles brothers and their creation of the Central Intelligence Agency, it seemed that the only way to learn the truth about whether the same thing that Harriman and Bush were accused of at that time is continuing today is to follow the advice of the secretive "Deep Throat" and "follow the money." Thanks to the internet, all of us can do the same thing in the privacy of our own homes and offices. A few years ago I downloaded a list of all the partners of Brown Brothers Harriman & Co. from a university computer. Recently I have been taking each name and running it through the recorded filings which are accessible through the SEC Edgar sites on the internet. Let's take one of those names and explore what we find. It's an historical name passed down through the generations--Elbridge T. Gerry--a family name which was around even before E.H. Harriman became a household word. The first Elbridge T. Gerry (a merchant shipper) was a signer of the Declaration of Independence and took a seat at the Continental Congress in 1776, served until 1785, and then retired to Cambridge, Mass. He was elected governor of Massachusetts in 1810 and, in 1813, was elected as James Madison's vice-president, though he died a year later. He had three sons and four daughters. (see http://www.jmu.edu/madison/gerry.htm ). His grandson "Commodore" Elbridge Thomas Gerry, 1837-1927, was a reformer. A position as legal advisor to the American Society for the Prevention of Cruelty to Animals led to his founding (1875), with the help of Henry Bergh, the New York Society for the Prevention of Cruelty to Children (sometimes called the Gerry Society). He devoted most of his life to this cause, which became national in scope. He and his wife, Louisa M. Gerry had two sons named after wealthy New Yorkers, Peter Goelet and Robert Livingston, and two daughters, Angelica and Francis. (see http://www.scripophily.net/scripophily/masvotbil.html ) Robert Livingston Gerry married Cornelia Harriman (daughter of railroad tycoon E.H. Harriman) in March 1908, and in 1912 built an estate, known as Aknusti on their 2,000 acre property in Delaware County, New York. They had four sons - Elbridge T., Robert L., and twins Henry and Edward. (see http://www.hartwick.edu/library/archives/gerry/moreinfo.html ) In 1939 their son, Edward H. Gerry, married Martha Botts Farish -- the daughter of William Stamps Farish, founder of Humble Oil in Houston. Cornelia Harriman was the sister of Averill. Edward's brother Elbridge, the eldest, born in 1908, held general partnerships in the banking firms Brown Brothers Harriman & Company, and Gerry Brothers & Company, and was a well-known philanthropist, notable polo player, avid participant in harness racing, and breeder of champion horse racers. In 1932 he married Marjorie Kane, daughter of John P. Kane. They had two sons, Elbridge T. Jr. and Peter G. II, and a daughter Marjorie. Elbridge Gerry, Sr. died February 26, 1999. Elbridge T. Jr. has assumed the role as partner in the Brown Brothers Harriman & Co. limited partnership. The Edward Gerrys had four children including Mrs. Cornelia Corbett (owner of American Soccer League team--Tampa Bay Rowdies) [note #1 below] and William F. Gerry, and have been heavily involved in horse-breeding. The Farish family genealogy shows that the family came to Virginia from Cumberland, England shortly after 1700, relocating to Mississippi a few generations later, before the Civil War. An ancestor, Hazlewood Farish, was married to the niece of Confederate president Jefferson Davis, and his son married Kate Power in 1860, whose father Stephen Power, owned one of the largest plantations in Natchez, Mississippi. Their son, the first William Stamps Farish, was born in Mississippi in 1881. His son was born in Texas in 1912 and died in 1943, one year after his father. (Genealogy set out in http://www.specent.com/dfarish/ged/dat9.htm#17 ). In 1928 W. Averill Harriman had played polo with Major Louis A. Beard, Walter A. Goodwin, William Ziegler, Elbert T. Gerry III, Robert Gerry, R. Penn Smith, and Marshall Field at Saratoga. In 1932 other players included John Hay "Jock" Whitney, C.V. "Sonny" Whitney, Robert Gerry, Edward Gerry and Henry Gerry. It was at Saratoga also that the family of Billy Mellon Hitchcock played polo, including Billy's father, Tommy Hitchcock who was on Averill Harriman's team for a time. Elbridge T. Gerry, Jr. was elected to the corporate board of Union Pacific Corporation in 1986, where he now sits alongside Mr. Richard B. Cheney. He is a member of the corporation's executive committee and finance committee. The current members of the Corporate Governance and Nominating Committee are Robert P. Bauman (Chair), Philip F. Anschutz, Richard B. Cheney, Elbridge T. Gerry, Jr., and Richard J. Mahoney. They also comprise directors of a separate holding company called Union Pacific Capital Trust, which recently issued a prospectus containing excerpts shown below. My understanding of what the prospectus describes (convertible preferred securities) is that it is similar to getting a second lien on your home to put a new roof on. But in order to get the money from the lender, you have to go to the first lender and get it to determine that its lien is worthless unless the roof is repaired, and so the lender agrees to subordinate the first lien. What that means is that existing shareholders are giving the opportunity to sell their stock to raise the money. The new owner acquires preferred (non-voting) shares which can be converted back to common shares by repayment of the money given to the company in accordance with the terms of the agreement. If it turns out, however, that there is no increase in the share value, the seller of the stock can decide to forego the right to repurchase the shares and let the lender/purchaser foreclose and get the shares which were the collateral for the money paid. Now this may not be exactly right, since I'm a real estate lawyer instead of an investment banker or tax accountant, but it gives you a general idea about what the following filings are talking about and about how the Union Pacific Railroad appears to be in the process of being looted by people like Dick Cheney and Brown Brothers Harriman. The question is: "Who is going to gain from this situation?" You can bet that it will be taxpayers, along with the pension funds and other holders of mutual funds, who will lose. ===== UNION PACIFIC CAPITAL TRUST Form: S-3/A Filing Date: 7/24/1998 1717 MAIN STREET SUITE 5900 DALLAS, TX 75201-4605 $30,000,000 CONVERTIBLE PREFERRED SECURITIES This Prospectus relates to the 6 1/4% Convertible Preferred Securities (the "Convertible Preferred Securities"), which represent undivided preferred beneficial ownership interests in the assets of Union Pacific Capital Trust, a statutory business trust formed under the laws of the State of Delaware (the "Trust" or the "Issuer"), and the shares of common stock, par value $2.50 per share (the "Company Common Stock"), of Union Pacific Corporation, a Utah corporation (the "Company"), issuable upon conversion of the Convertible Preferred Securities. The Convertible Preferred Securities were issued and sold (the "Original Offering") on April 1, 1998 ......As used herein, (i) the "Indenture" means the Convertible Junior Subordinated Indenture, between the Company and The Bank of New York, as trustee (the "Debenture Trustee") relating to the Issuer, (ii) the "Declaration" means the Amended and Restated Declaration of Trust relating to the Issuer among the Company, as Depositor (the "Depositor"), The Bank of New York as Property Trustee (the "Property Trustee"), The Bank of New York (Delaware) as Delaware Trustee (the "Delaware Trustee"), and the individuals named as Administrative Trustees therein (the "Administrative Trustees") (collectively with the Property Trustee and the Delaware Trustee, the "Issuer Trustees") and (iii) the "Guarantee" means the Guarantee Agreement between the Company and The Bank of New York (the "Guarantee Trustee"). In the third quarter of 1997, congestion began to have a serious adverse effect on the operations and earnings of Union Pacific Railroad Company ("UPRR"), the Company's principal rail subsidiary. System congestion started in and around Houston and the coastal areas of Texas and Louisiana (the "Gulf Coast region") and spread throughout the system as UPRR shifted resources to help mitigate the problem in the Gulf Coast region. The Company reported a decline in net income from continuing operations of approximately 41%, from $733 million for 1996 to $432 million for 1997. Moreover, the Company incurred a net loss of $152 million ($.62 per diluted share) in the fourth quarter of 1997 (which included a $40 million after tax loss recognized in connection with Company's planned sale of Skyway Freight Systems, Inc. ("Skyway")) and a net loss of $62 million ($.25 per diluted share) and $419 million ($1.70 per diluted share) for the first and second quarters of 1998, respectively. ****Skyway Divestiture. In January 1998, the Company announced its intention to sell Skyway, a wholly-owned subsidiary engaged in contract logistics and supply chain management, by the end of the year. In connection with the planned sale, the Company recognized a $40 million after tax loss in the fourth quarter of 1997. In 1997, Skyway had revenues of $152 million and an operating net loss of $5.5 million. ****** ++++++++++++++++++ http://www.skyway.com/about/pressroom/releases/closure.html Press Release Contact at Skyway: Leslie Ferrera (831) 763-7251 Skyway Freight Systems, Inc. Closes Its Operations (WATSONVILLE, CA) March 31, 2000 – Effective today, Skyway Freight Systems, Inc., an expedited transportation and third party logistics provider, has ceased its transportation operations and is in the process of transitioning its contracted logistics customers to new providers. Skyway is closed for business effective immediately, but all efforts will be made to ensure that all shipments are delivered to customers in a secure and timely manner. ++++++++++++++++ Second quarter results included a $261 million loss from discontinued operations arising from the expected sale of Overnite Transportation Company ("Overnite"), the Company's principal trucking subsidiary. See "The Company." +++++++++++++++++ http://www.overnite.com/AboutUs/General/factsheet.shtml HISTORY: Founded in 1935, Overnite became a public company in 1957 and was acquired by Union Pacific Corporation in 1986. REVENUES: The company had operating revenues in excess of $1 billion in 1999 and is the seventh largest provider of LTL services in the United States. +++++++++++++++++ This decline in earnings is primarily the result of UPRR's service and congestion problems. The Company estimates that the combined effects of lost business, higher costs associated with system congestion, and costs associated with the implementation of the service recovery plan described below, alternate transportation and customer claims had a negative effect on net income for 1997 of approximately $450 million, after tax, and a negative effect on net income for the first and second quarters of 1998 of approximately $260 million, after tax, and $434 million, after tax, respectively. Although progress has been made in improving service, UPRR expects these problems to continue to have an adverse impact on 1998 results. While the Company believes that it will ultimately be successful in alleviating the congestion-related problems experienced by UPRR and returning the Company to profitability, there can be no assurance that the recovery will not be delayed for a substantial period, which would have a continuing adverse effect on the Company's financial results, or that additional measures will not be necessary to resolve such problems. The timing of the Company's return to profitability will be determined by how rapidly it is able to eliminate congestion and return to normal operations throughout its system. As a result of operating losses at UPRR and in order to fund its capital program, the Company has incurred substantial incremental debt since December 31, 1997, most of which has been repaid from the proceeds of the issuance of the Convertible Preferred Securities. On March 31, 1998, the STB initiated a proceeding under its continuing oversight jurisdiction with respect to the merger of Southern Pacific Transportation Company and its affiliated railroads ("Southern Pacific") and UPRR, to consider proposals for new remedial conditions to the merger as they pertain to service in the Houston, Texas/Gulf Coast area. The proceeding was initiated in response to submissions by Texas Mexican Railway Company ("Tex Mex"), Kansas City Southern Railway Company ("KCS") and the Greater Houston Partnership ("GHP"), proposing that UPRR be directed to transfer certain lines and facilities in the Gulf Coast region to other rail carriers, that a "neutral" switching operation be established in the greater Houston area and that provisions in the STB's emergency service order that expanded Tex Mex's right to handle traffic to and from Houston be adopted permanently. The STB's decision announcing the proceeding established a procedural schedule for the submission of evidence, replies and rebuttal. Separately from this proceeding, a shortline railroad, the Arkansas, Louisiana and Mississippi Railroad ("AL&M"), has filed a request that an additional condition be imposed on the merger allowing AL&M to interchange with BNSF. [note #2 below] The Company and certain of its officers and directors are currently defendants in two purported class action securities lawsuits. The class action suits allege, among other things, that management failed to disclose properly UPRR's service and safety problems and thereby issued materially false and misleading statements concerning the Company's acquisition of Southern Pacific's parent corporation and the safe, efficient operation of UPRR's rail network. These lawsuits were filed in late 1997 in the Federal District Court for the Northern District of Texas and seek to recover unspecified amounts of damages. The Company believes that these claims are without merit and intends to defend them vigorously. The Company, incorporated in Utah in 1969, operates through subsidiaries primarily in the areas of rail transportation and trucking. The Company's rail transportation operations principally consist of UPRR, which includes two major acquisitions since 1995, Southern Pacific and Chicago and North Western Railway Company and its affiliated railroads ("CNW"). The Company's trucking operations principally consist of Overnite. On May 20, the Company announced that it intends to sell its entire interest in Overnite through an initial public offering of all the common stock of Overnite Corporation, a newly formed Virginia corporation created for the purpose of indirectly holding all of the issued and outstanding capital stock of Overnite (the "Overnite IPO"). Natural Resources Divestiture. In July 1995, the Company's Board of Directors approved a formal plan to dispose of its oil, gas and mining business through an initial public offering (the "IPO") of 17% of the common stock of Union Pacific Resources Group, Inc. ("Resources"), followed by a distribution of the Company's remaining interest in Resources to the Company's stockholders on a tax-free, pro-rata basis (the "Spin-Off"). In October 1995, Resources completed the IPO, and, after the Company's receipt of a favorable Internal Revenue Service ruling as to the tax-free nature of the Spin-Off, the Company completed its divestiture of Resources in October 1996. +++++++++++++++ Note: Lynne V. Cheney is a director for this spin-off company, Union Pacific Resources, Inc., serving on both the Audit and Finance Committees. which has its offices at 777 Main Street in Fort Worth, Texas. This building also houses Richard Rainwater's Crescent Real Estate Equities, which is one of the largest REITs in the U.S. See SEC filing at http://www.sec.gov/Archives/edgar/data/918958/0000950134-98-003648.txt , which shows the following resume for Mr. Rainwater: Richard E. Rainwater has been an independent investor since 1986. From 1970 to 1986, he served as the chief investment advisor to the Bass family, whose overall wealth increased dramatically during his tenure. During that time he was principally responsible for numerous major corporate and real estate acquisitions and dispositions. Immediately after beginning his independent investment activities, he founded ENSCO International Incorporated, an oil field service and offshore drilling company, in 1986. Additionally, in 1987 he co-founded Columbia Hospital Corporation, and in 1989 participated in a management-led buyout of HCA-Hospital Corporation of America. In 1992, Mr. Rainwater was one of the founders of Mid Ocean Limited, a provider of casualty re-insurance. In February 1994, he assisted in the merger of Columbia Hospital Corporation and HCA-Hospital Corporation of America that created Columbia/HCA Healthcare Corporation. Mr. Rainwater serves as a director of Pioneer Natural Resources ("Pioneer"), one of the largest oil and gas companies in the United States. In 1996, Mr. Rainwater led a recapitalization of Mesa, Inc. (Pioneer's predecessor), and a partnership controlled by Mr. Rainwater became a major shareholder in July 1996. Mr. Rainwater is also chairman of the board of directors of Crescent Operating, Inc. ("COI"). Mr. Rainwater is a graduate of the University of Texas at Austin and the Graduate School of Business at Stanford University. Mr. Rainwater has served as the Chairman of the Board of Trust Managers since the Company's inception in 1994. +++++++++++++++++ [Note: Rainwater's connection to Columbia/HCA may be no coincidence, since one of the biggest investors in that company was the 1818 Fund controlled by Brown Brothers Harriman. Brown Brothers Harriman partner Elbridge T. Gerry, Jr. is also a director of Union Pacific Corporation and Union Pacific Capital Trust.] [For more insight into the Bush connection to Richard Rainwater, see: http://www.geocities.com/CapitolHill/3750/bushmillions.html HOW BUSH REALLY MADE HIS MILLIONS.] +++++++++++++++ See attached picture of locations of the resources owned by the company. See also: http://www.upr.com/investor/97annrep/directors.shtml ***** FORT WORTH, Texas, Jan. 26 /PRNewswire/ -- Union Pacific Resources Group Inc. (NYSE: UPR - news) today announced that its Board and the Board of Norcen Energy Resources Limited (Norcen) have unanimously approved the acquisition of Norcen by UPR. The US$2.6 billion all cash transaction will increase UPR's estimated 1998 revenues to US$2.7 billion from US$1.9 billion. UPR is offering C$19.80 per share (US$13.65) for all outstanding shares of Norcen stock which represents a 29 percent premium over Norcen's closing price on January 23, 1998 of C$15.30 per share. UPR will also assume Norcen's outstanding net debt of approximately US$900 million, giving the overall transaction a US$3.5 billion value. Norcen's properties are located in four major areas which include Western Canada, the Gulf of Mexico, Venezuela and Guatemala. In addition, Norcen owns producing properties in Argentina and offshore Australia. http://www.upr.com/news/980126a.shtml ++++++++++++++ The Company's executive offices are located at 1717 Main Street, Suite 5900, Dallas, Texas 75201-4605, and its telephone number is (214) 743-5600. This is in the Bank One Center building.] UNION PACIFIC CAPITAL TRUST Union Pacific Capital Trust is a statutory business trust that was formed under Delaware law on March 17, 1998. The Trust's original declaration of trust was amended and restated in its entirety by the Company, as sponsor of the Trust, and the trustees of the Issuer (the "Issuer Trustees") (as so amended and restated, the "Declaration"), on the Original Offering Date. Pursuant to the Declaration, there are initially five Issuer Trustees. Three of the Issuer Trustees (the "Administrative Trustees") are individuals who are employees or officers of or who are affiliated with the Company. The fourth trustee is a financial institution that is unaffiliated with the Company (the "Property Trustee"). The fifth trustee is an entity which maintains its principal place of business in the State of Delaware (the "Delaware Trustee"). Initially, The Bank of New York, a New York banking corporation, acts as Property Trustee and its affiliate, The Bank of New York (Delaware), a Delaware banking corporation, acts as Delaware Trustee until, in each case, removed or replaced by the holder of the Common Securities. The Bank of New York also acts as indenture trustee under the Guarantee (the "Guarantee Trustee") and under the Indenture (the "Debenture Trustee"). SELLING HOLDERS The Convertible Preferred Securities were originally issued by the Trust and sold by Credit Suisse First Boston Corporation, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Smith Barney Inc. and Schroder & Co. Inc. (the "Initial Purchasers") in a transaction exempt from the registration requirements of the Securities Act, to persons reasonably believed by such Initial Purchasers to be "qualified institutional buyers" (as defined in Rule 144A under the Securities Act), to a limited number of institutional "accredited investors" (as defined in Rule 501(a) (1), (2), (3) or (7) under the Securities Act) and outside the United States to non-U.S. persons in offshore transactions in reliance on Regulation S under the Securities Act. The Selling Holders may from time to time offer and sell pursuant to this Prospectus any or all of the Convertible Preferred Securities, any Convertible Junior Subordinated Debentures and Company Common Stock issued upon conversion of the Convertible Preferred Securities. The following table sets forth information with respect to the Selling Holders of the Convertible Preferred Securities and the respective number of Convertible Preferred Securities beneficially owned by each Selling Holder that may be offered pursuant to this Prospectus. Credit Suisse First Boston Corporation...................... 2,822,418 Fidelity Securities Fund: Fidelity Growth & Income Portfolio(1).............................................. 1,377,000 Argent Classic Convertible Arbitrage Fund (Bermuda) L.P..... 1,335,000 Hartford Capital Appreciation Fund, Inc.(2)................. 1,230,000 Lipper Convertibles, L.P.................................... 1,069,700 The Income Fund of America, Inc............................. 976,200 Fidelity Devonshire Trust: Fidelity Equity-Income Fund(1)... 817,600 J.P. Morgan & Co. Incorporated.............................. 752,133 Equity Portfolio............................................ 700,000 Equity Income Portfolio..................................... 541,000 Aim Charter Fund............................................ 500,000 Premium Total Return Portfolio.............................. 472,000 Alliance Growth and Income Fund, Inc........................ 444,000 Argent Classic Convertible Arbitrage Fund L.P............... 390,000 Variable Insurance Products Fund: Equity-Income Portfolio(1).............................................. 384,500 Oppenheimer Main Street Funds Inc. for the Oppenheimer Main Street Income & Growth Fund............................... 350,300 Commerzbank AG.............................................. 350,000 Salomon Brothers Fund(3).................................... 350,000 The TCW Group, Inc.......................................... 346,800 SBC Warburg Dillon Read Inc................................. 343,500 The Northwestern Mutual Life Insurance Company(4)........... 340,000 General Motors Investment Management Corp.(3)............... 300,000 Paloma Securities LLC....................................... 300,000 The Cincinnati Insurance Company............................ 300,000 Allstate Life Insurance Company............................. 286,500 Fidelity Capital Trust: Fidelity Value Fund(1).............. 268,000 Fundamental Investors, Inc.................................. 260,000 Oppenheimer Bond Fund Series -- Oppenheimer Convertible Securities Fund........................................... 250,000 Hartford Capital Appreciation Fund(2)....................... 246,000 Prudential Equity Income Fund............................... 243,900 Prudential Series Fund, Inc. -- Equity Income Portfolio..... 243,900 Grantham, Mayo, Van Otterloo & Co., LLC..................... 240,000 Highbridge International, LLC............................... 230,000 MainStay Convertible Fund................................... 230,000 Chilton International (BVI) Ltd............................. 214,266 The Hudson River Trust -- Alliance Growth and Income Portfolio................................................. 206,000 Transamerica Life Insurance & Annuity Co.................... 200,000 Fidelity Puritan Trust: Fidelity Balanced Fund(1)........... 200,000 Fidelity Puritan Trust: Fidelity Puritan Fund(1)............ 190,600 Putnam Convertible Income-Growth Trust...................... 186,373 Chilton Investment Partners, L.P............................ 183,869 T. Rowe Price Associates, Inc............................... 178,100 Allstate Insurance Company.................................. 176,000 Vanguard Equity Income Fund................................. 168,300 Fiduciary Trust Company International....................... 151,000 Chase Vista Growth & Income Fund............................ 150,000 GLG Market Neutral Fund..................................... 150,000 Fidelity Financial Trust: Fidelity Equity-Income II Fund(1)................................................... 139,400 Oppenheimer Equity Income Fund.............................. 131,400 BT Holdings (New York ) Inc................................. 130,500 Davis New York Venture Fund, Inc............................ 125,000 Salomon Brothers Investors Fund(3).......................... 125,000 MFS Series Trust V -- MFS Total Return Fund................. 117,500 Bond Fund of America, Inc................................... 111,100 Fidelity Management Trust Company on behalf of accounts managed by it(5).......................................... 111,000 Allmerica Select Growth & Income Fund....................... 105,200 Paloma Strategic Fund, L.P.................................. 100,000 President & Fellows of Harvard College...................... 100,000 The Cincinnati Life Insurance Company....................... 100,000 Baker, Fentress & Company................................... 93,100 JP Morgan Securities Inc.................................... 92,133 MainStay Value Fund......................................... 90,000 Pacific Horizon Capital Income Fund......................... 90,000 Teachers Insurance and Annuity Association of America....... 90,000 Oppenheimer Total Return Fund, Inc.......................... 87,600 Shriners Hospitals For Children............................. 87,000 The Chase Manhattan Bank NA Trustee for IBM Retirement Plan dated 12/18/45............................................ 85,800 Aim V.I. Growth & Income Fund............................... 80,000 Excelsior Value & Restructuring Fund........................ 80,000 Chrysler Insurance Company.................................. 75,000 Continental Casualty Company................................ 71,000 Evergreen Income & Growth Fund.............................. 70,000 Equity Income Fund.......................................... 67,200 The EB Convertible Securities Fund.......................... 66,900 Bear, Stearns & Co. Inc..................................... 61,000 American Home Assurance Company............................. 60,000 American Investors Life Insurance Company, Inc.(3).......... 60,000 AAM/Zazove Institutional Income Fund, L.P................... 58,200 Guardian Life Insurance Company of America.................. 57,000 MFS Series Trust I -- MFS Managed Sectors Fund.............. 56,400 Bank One Trust Company, N.A................................. 54,600 The Charitable Securities Fund.............................. 53,506 Personal Trust Income Equity Fund........................... 53,000 United National Insurance Company........................... 52,000 Bankers Trust Trustee for Chrysler Corporation Emp. #1 Pension Plan dated 4/1/89................................. 50,300 CIBC Oppenheimer Corp....................................... 50,000 Employers Reinsurance Corp. (3)............................. 50,000 GLG Global Convertible Fund................................. 50,000 Michigan Mutual Insurance Company........................... 50,000 Stagecoach Diversified Equity Income Fund................... 47,700 MFS/Sunlife Series Trust -- Managed Sector Series........... 45,700 Employers' Reinsurance Corporation.......................... 43,745 The Common Fund............................................. 42,600 Lehman Brothers, Inc........................................ 40,700 IDS Bond Fund, Inc.......................................... 40,000 The Victory Convertible Securities Fund..................... 40,000 Motors Insurance Corp.(3)................................... 40,000 Presidential Life Insurance Company......................... 40,000 Public Employees Retirement Association of Colorado......... 40,000 Sound Shore Partners L.P.................................... 40,000 Tennessee Consolidated Retirement System.................... 40,000 Chilton QP Investment Partners, L.P......................... 38,040 Davis Growth and Income Fund................................ 38,000 American Balanced Fund, Inc................................. 30,000 Associated Electric & Gas Services Limited.................. 30,000 HSB Group, Inc.............................................. 30,000 MainStay Institutional Value Equity Fund.................... 30,000 Pillar Equity Income Fund................................... 30,000 Selected American Shares, Inc............................... 30,000 Smith Barney Convertible Fund............................... 30,000 TQA Vantage Fund, Ltd....................................... 30,000 Public Service Mutual Insurance Company..................... 27,000 State Street Bank Custodian for GE Pension Trust............ 26,500 Millers Mutual Fire Insurance Company of Texas.............. 26,000 The Potlatch-First Trust Co. of St. Paul.................... 25,200 United Teacher Associates Insurance Company................. 25,000 Life Special Income Fund.................................... 24,000 Delaware Group Dividend and Income Fund, Inc................ 23,900 Lone Star Life Insurance Company............................ 23,700 Chilton Opportunity Trust, L.P.............................. 23,100 Ozark National Life Insurance Company....................... 21,200 NAC Reinsurance Company(2).................................. 21,000 July 24, 1998 --------------------------------------------------- RICHARD K. DAVIDSON Chairman, President, Chief Executive Officer and Director (Principal Financial Officer) Gary M. Stuart (Principal Accounting Officer) Joseph E. O'Connor, Jr. Philip F. Anschutz Director Robert P. Bauman Director Richard B. Cheney Director E. Virgil Conway Director Spencer F. Eccles Director Elbridge T. Gerry, Jr. Director William H. Gray, III Director Judith Richards Hope Director Richard J. Mahoney Director John R. Meyer Director Thomas A. Reynolds, Jr.Director Richard D. Simmons ========= If you would like to participate in this research project, you can follow the names of persons you read about in the news and want to know more about. One search site [ http://www.edgar-online.com/people/ ]allows you to search a name of an individual, and it will give you back a list of every SEC filing in which that name appears. However, unless you subscribe for a fee, you cannot open the sites it returns. You can, however, make a note of the corporations and search them for the name. The best site for searching the corporations is http://www.freeedgar.com/ .You can search the corporation name. If any filings are found by the search, the name will be returned with the option "view filings" which you can then click on. The next screen will list all types of forms the corporation has filed with the SEC. The form most likely to list the names of the directors and officers of the company is called DEF 14A. If you click on that, it will return to you the introductory portion of that filing in the main screen, with an index in the frame section to the left of the screen. If you scroll down under table of contents, and click on DEF 14A--Definitive Proxy Statement, you will then have the complete filing in the right-hand screen, which can be searched for relevant names. That is how I find most of the information about individuals or corporations I know they are involved with. In the event the individual is the manager of a fund or the director of a private company which is not required to file with the SEC, it can still be mentioned in filings of other corporations. In that case, you can do a "full text search" at: http://textsearch.freeedgar.com/fulltextsearch/default.asp by clicking on "Full text search" under "search filings" in the left frame of the freeedgar.com home site. ======= NOTES: 1. http://www.andelman.com/ARTICLES/tbrowdies.html Born in Manhattan in 1946 to a "well-to-do" family (she'll say only that her father is in "investments," her mother owns racehorses and Cornelia herself has "private income"), Corbett earned a degree from New York University (Washington Square) in history. As soon as she graduated though, "Cornie" as friends and family call her went west to teach skiing in Aspen. She met Dick there in '68 and returned with him to New York City. They married two years later. The honeymoon was exotic and long three months of hiking and wandering through Tibet, Nepal, Kamandu and the Himalayas. "The two of us slept in mud huts with the Nepalese," remembers Dick. "We traveled with nothing but the clothes on our backs and two sleeping bags. That trip showed she was a great outdoors lady. Leaving Manhattan, she was comfortable sleeping in a mud hut next to a campfire, crawling up and down the Himalayan range. She was a doer and great fun to be with." As her husband made his first million in real estate (see sidebar), Cornelia spent three years as a case officer investigating abuse and neglect for the Society for the Prevention of Cruelty to Children. "It was interesting and pretty gruesome," she recalls. When their first child was born in '73, it was time for a career change. "I could no longer be objective," says Cornelia. "I couldn't do case work. Every child became my own." The Corbetts met on the ski slopes, but Dick himself a former light-weight amateur boxer with a nose broken in six places to prove it introduced Cornelia to golf and, of course, she's been playing ever since. They take family vacations to hunt or go white-water rafting in Colorado, climbing in the Grand Canyon and camping with Wild Kingdom TV host Jim Fowler (he is godfather to one of their children). The couple is "simpatico," says Cornelia, very upbeat. If an impression of Cornelia Corbett as ultimate sportswoman is being formed, it's not incorrect. "I've been a sports nut all my life," she says. "If I have been consistent in one thing in my life, it's my love of sports and competition." Cornelia and Dick moved to Tampa in 1978. In 1984, when the NASL went under, Dick Corbett's partners in the Rowdies, Stella Thayer and Bob Blanchard, decided to bow out as well. They didn't know where soccer was going if anywhere and lacked the spirit and time to continue. Dick and Cornelia toughed it out although the team has nowhere to play in '85. In '86, Dick made his wife sole owner. Sidebar: Dick Corett's International Dream Development deals can take a long time to work out. There's land acquisition, financing, permiting, sales and marketing. Not to mention 95 percent luck. Even so, Dick Corbett's International Plaza a 135-acre, mixed-use project planned at the intersection of Westshore Blvd. and Columbus Drive near Tampa International Airport has been a long time coming. First announced in 1983, the property received its DRI in 1985. Corbett has made little visible progress since, except for demolishing the Hall of Fame Inn, which was once on the site...With a no doubt impressive Rolodex of contacts and an equally impressive resume, Corbett found a position with Joseph P. Kennedy Enterprises in Manhattan. He spent a decade with the Kennedys, buying and selling real estate, making more contacts and setting up lucrative deals for himself on the side. During that time he hit the campaign trail with Robert F. Kennedy; "I was eight feet away from RFK when he was shot," says Corbett, pausing. "At that point, I left politics." Corbett says he left Harvard in '64 with $5,000 in debt. Six years later, through shrewd real estate deals, his net worth was several million dollars. -- Bob Andelman 2. Very strange that Kemper Securities also ended up owning W.S. Farish's family's investment bank, Underwood Neuhaus, which was located in the Houston Club Bldg. for many years--the same building George Bush had his first Houston office in. This railroad runs through Mena, but I'm not sure how close it goes to Waco. http://www.businessweek.com/2000/00_13/b3674024.htm Q&A with Kansas City Southern's Landon Rowland "Doing the same job better, and getting more people in the company involved" Kansas City Southern is a company with a long and illustrious history. It was founded in 1890 by Arthur Stilwell, a New York State transplant who had worked at Travelers Insurance. As railroads' growth potential declined, the company invested heavily in financial services. In 1962, it bought TV Shares Management (later called SIS), a mutual-fund company, and merged it with Kemper Co. to become Kemper Financial Services, an independent company. Kansas City Southern acquired Pioneer Western Reserve Life Insurance Co. in Denver in 1979. The company went on to acquire Janus Capital Corp. (l984), Berger Funds (1992), and Nelson Money Managers (1998), a retirement-planning consultancy. This month, Mutual Fund Magazine awarded the Janus Family of Funds its No. 1 ranking for fund families, with Berger Funds No. 2. The railroad subsidiary is also innovative. When the Mexican government privatized railroads in 1997, KCSI bought a 49% interest in Transportacion Maritima Mexicana. Called "the NAFTA Railroad" by KCSI, the railroad links Mexico City and Laredo, Tex. According to analysts, this quarter the company should finally recoup its borrowing expense for the Mexican line, and the railroad will become profitable. There are plans for KCSI's financial-services companies (Janus, Berger, DST, and Nelson) to be spun off into a new entity to be called Stilwell Financial Co. in a tax-free arrangement. The plan has been approved by the shareholders, the board, and the IRS, and is awaiting SEC approval. Landon H. Rowland, 62, a former litigation attorney, joined KCSI 20 years ago. He became president in 1987, and chairman in 1997. He'll be chairman and CEO of Stilwell and nonexecutive chairman of KCSI. He spoke with Business Week's Ann Therese Palmer by phone on Mar. 2. Edited excerpts of their conversation follow: Q: This is an unusual combination for a company -- a railroad and financial management. Why did Kansas City Southern originally acquire Janus and the other financial-management components? What did it do for you that other transportation companies don't have? A: KCSI has been in the mutual-fund business since 1963. In the early l960s, Kansas City Southern concluded that the regulatory environment and capital returns in the railroad industry were very discouraging. There were better ways to create and realize shareholder value. The company invested in shares of a technology fund management company that had fallen on hard times. We changed the name to Supervised Investment Services and merged it with Kemper Insurance to create Kemper Financial Services, which we later sold. Through our ownership of SIS, we realized that the mutual-funds industry had a critical technology deficiency and inadequate infrastructure to build and service shareholder accounts. We asked the data-processing people at the railroad, who'd just completed a complex accounting system, to create one for our mutual-fund customers. That team became DST, now the leading technology platform for mutual funds, which we sold to the public in 1985. In 1984, we acquired Janus Capital Corp., the manager of Janus Funds. At that time, Janus was managing approximately $400 million. The principal attraction to us was its strength in down markets, as well as up markets. Q: Why does Kansas City Southern want to now spin off its financial-management component? Why not the opposite -- spin off the railroad? A: It's important that we separate these operations to better realize the values created by the individual companies. Transportation and financial services have very different industry characteristics with different earnings and cash flow streams, and the need for very different equity compensation and capital programs. We're spinning off financial services instead of the railroad because the railroad has regulatory and industry considerations that the financial-services side doesn't have. After much study, we concluded it would be easier to spin off the financial-services side. Q: Why isn't Janus being spun off by itself, as some of the Janus employees want to do? A: The tax-free ruling by the IRS could only be secured if we had a clean separation between all financial services and all transportation businesses within KCSI. Such a separation would more nearly meet the emphasis on "fit and focus" needed to achieve the substantial financial advantages of the separation. We believed a spin off of Janus alone would have been more problematical. Q: The financial services side of KCSI will be called Stilwell Management Company. It will comprised Janus, Berger Funds, and Nelson. What kind of additional value will Stilwell Management bring to the financial-asset-management side that isn't there now? A: First of all, the separation will deliver a lot of value for shareholders. Moreover, as a "pure play" Stilwell will be an attractive equity. Once Stilwell is a stand-alone company, we will be able to focus on the opportunities open to a financial-services company free of the capital and regulatory risks of the railroad industry. One of our objectives will be to support the continuing growth of Janus, Berger, and Nelson. Janus clearly has much more growth ahead of it. It's the global leader in asset management. The future of Janus is just beginning. Q: What will the spin-off do for the railroad side? A: As a stand-alone, KCSI's transportation equity will clearly be seen as a unique railroad franchise with strong strategic placement as the core of the NAFTA rail network and exceptional, even unprecedented, opportunities in Mexico and Panama. The market volatility that often goes with financial services will no longer be a distraction to the railroad business. Q: Janus is an equity-fund manager. When is it going to aggressively pursue bond management? A: That decision is up to the Janus management. Janus does have excellent fixed-income products. The difficulty with bonds is that bond funds generally don't do for investors what a direct investor in bonds can do better for themselves. Q: Any idea when the spin-off will happen? A: SEC approval of Stilwell's filing is the last step needed to proceed with the transaction. Upon completion of SEC review, we expect to proceed expeditiously to complete the separation. Q: In general, why has the company performed so well in the last three years? What's driving your growth? A: The company has been performing so well for [three] reasons. First, at the beginning of the early l990s, we sold off everything except our financial-services and transportation segments to achieve focus on these core operations. Concentrating on just two segments has been easier than working with telecommunication franchises, TV stations, and fiber businesses. Second, the management of our subsidiaries in financial services and transportation have positioned their operations extremely well to participate in current markets. These mangers are principally responsible for KCSI's outstanding results. Our management policy has been to focus on finding good people and letting them run their businesses. We're there to support them in growing these businesses. Finally, the strong economy has helped. Q: KCSI had the third-highest net-income growth over the last three years of all of the companies on Business Week's list. Why? A: It's the result of the extraordinary performance in these extraordinary markets of Janus and our other financial-services investments. The performance of our railroad investment in Mexico has also helped. Q: What has KCSI done that distinguishes it from its other transportation-sector competitors? How has this impacted the revenues, earnings, and other key indexes -- return on equity, margins, and stock performance for the past three years? A: Kansas City Southern Railroad is the core of the new north/south NAFTA rail network. This strategic position makes our railroad a unique franchise. TFM, the Mexican railroad investment, has experienced remarkable improvements in revenues, up 22% in 1999. In earnings, it's gone to a $4.1 million profit in 1999 from a $7.3 million loss in 1998, and in operating ratio improvement from 85.5% to 76.6%. Q: Are you planning any acquisitions this year? A: In Panama, we were approached by the government to rebuild the railroad across the country and link the two sides of the isthmus from the Atlantic to the Pacific. We have a 50-year concession. This railroad will primarily service the booming transportation opportunity in Panama. Containerization of traffic has revolutionized the shipping business. Seventy percent of the cargo at the Canal's terminals is in containers that is unloaded from one ship and loaded on to another one. We've also just acquired Gateway Western, which will provide us with access at St. Louis to eastern carriers without the congestion of the St. Louis Terminal. It's a major advantage and an enhancement of our strategic network.
