_Q._ You say you made propositions to railroad companies, which they agreed to accept upon the condition that you could include all the refineries? _A._ No, sir; I did not say that; I said that was the understanding when we discussed this matter with them; it was no proposition on our part; they discussed it, not in the form of a proposition that the refineries should be all taken in, but it was the intention and resolution of the company from the first that that should be the result; we never had any other purpose in the matter. _Q._ In case you could take the refineries all in, the railroads proposed to give you a rebate upon their freight charges? _A._ No, sir; it was not put in that form; we were to put the refineries all in upon the same terms; it was the understanding with the railroad companies that we were to have a rebate; there was no rebate given in consideration of our putting the companies all in, but we told them we would do it; the contract with the railroad companies was with us. _Q._ But if you did form a company composed of the proprietors of all these refineries, you were to have a rebate upon your freight charges? _A._ No; we were to have a rebate anyhow, but were to give all the refineries the privilege of coming in. _Q._ You were to have the rebate whether they came in or not? _A._ Yes, sir. * * * “What effect were these arrangements to have upon those who did not come into the combination...?” asked the chairman. “I do not think we ever took that question up,” answered Mr. Warden. A second objection to making a contract with the company came from Mr. Scott of the Pennsylvania road and Mr. Potts of the Empire Transportation Company. The substance of this objection was that the plan took no account of the oil producer—the man to whom the world owed the business. Mr. Scott was strong in his assertion that they could never succeed unless they took care of the producers. Mr. Warden objected strongly to forming a combination with them. “The interests of the producers were in one sense antagonistic to ours: one as the seller and the other as the buyer. We held in argument that the producers were abundantly able to take care of their own branch of the business if they took care of the quantity produced.” So strongly did Mr. Scott argue, however, that finally the members of the South Improvement Company yielded, and a draft of an agreement, to be proposed to the producers, was drawn up in lead pencil; it was never presented. It seems to have been used principally to quiet Mr. Scott. [Illustration: THOMAS A. SCOTT The contract of the South Improvement Company with the Pennsylvania Railroad was signed by Mr. Scott, then vice-president of the road. ] [Illustration: JAY GOULD President of the Erie Railroad in 1872. Signer of the contract with the South Improvement Company. ] [Illustration: