When Addicks purchased the several Boston gas properties he organized a
company, the Bay State of Delaware, in which this ownership was vested.
In order to facilitate the financing of the new corporation and for
other manipulative purposes of his own, Addicks created an inner
corporation, the Bay State of New Jersey, owned by the treasury of the
Bay State of Delaware, to which he turned over the stocks of the Boston
gas companies. These the Bay State of New Jersey transferred to the
Mercantile Trust Company of New York as collateral for the twelve
million Boston Gas bonds which had been sold to the investing public.
While to all intents and purposes the Bay State of Delaware was owner of
the subsidiary properties, the contract with the Mercantile Trust
Company was made with the Bay State of New Jersey, and it was to the
president of the latter corporation (Addicks) that the Trust Company was
bound to deliver the proxies for the gas stocks in its possession, three
days before an annual election. Knowledge of this subcutaneous
corporation was confined to Addicks and his immediate associates, and
the Delaware financier alone quite grasped its potentialities.

Hitherto Addicks had used the proxies to elect himself president of each
of the subordinate corporations, drawing the several salaries which went
with the offices. To prevail on him to give up these places and their
emoluments to a man he hated as bitterly as he did Matthews was a
difficult task, but his situation was desperate. Finally, he agreed. I
did not know till long afterward that this reluctant compliance was
yielded only after Addicks had had a secret session with his Bay State
directors, at which they voted him, by way of salve for his resignation,
a sum equal to three years' salary, $75,000.

The mayor, who was a lawyer, prided himself on his shrewdness, and was
fully alive to the serpent strategy of Addicks. He determined that the
prize he had secured should not slip through his fingers for lack of
precaution. We had many legal pow-wows in which the most astute lawyers
at the Boston bar were called in, and finally the directors of the Bay
State made an iron-clad contract with Nathan Matthews, agreeing to
deliver over to him whatever proxies it, the Bay State Gas of Delaware,
received from the Mercantile Trust Company of New York, on a given day
before the annual election, with which he, of course, could elect
himself president. This contract was signed by