|There are numerous motives for the lease agreement with the Atchison Topeka & Santa Fe and the Denver Rio
Grande, one was the aggressive expansion of the Santa Fe into the Rio Grande territory and the vigorous
leadership of W. B. Strong, coupled with the financial inferiority of the Denver Rio Grande. Mr. Palmer of the
Rio Grande contended that it was due to the imminent consolidation of the Denver Rio Grande with the Pueblo &
Arkansas Valley Railroad, a Santa Fe subsidiary. It was also desired to equal the stock and debt of both
companies. Basically one share of Pueblo & Arkansas Valley stock was swapped for five shares of the Denver Rio
Grande stock. Originally the Pueblo & Arkansas Valley issued stock was $15,438 per finished mile with a bonded
debt of $11,780 per finished mile, while the Denver Rio Grande stock issued at $25,222 with a bonded debt of
$22,664 per mile and another $500,000 of outstanding debt before the lease was made, making the Denver
Rio Grande stock practically worthless. Also about $1,700,000 worth of Pueblo & Arkansas Valley stock was
provided to Palmer, as he required, for further payment in the company's debts in excess of the bonded debt
of $22,664 per mile.
On December 03, 1878, the Denver Rio Grande stockholders ratified the lease with the Atchison Topeka &
Santa Fe by a four fifths vote, in Colorado Springs. The stock of the Pueblo & Arkansas Valley and Denver Rio
Grande companies which had been interchanged was deposited in Boston, Massachusetts, naming Mr. T. J.
Coolidge ,trustee. On December 13, 1878 the Denver Rio Grande and its effects passed to the Atchison Topeka
& Santa Fe Railroad, by order of President Palmer. On the same date, W. B. Strong announced that all operating
officials of the Rio Grande would be transferred to the Santa Fe payrolls and he instructed D. C. Dodge,
general manager of the Rio Grande, the line to and from Denver was open for freight and passenger business.