Phillipsburg herald. [volume] (Phillipsburg, Kan.) 1882-1905, 1890-01-17
LOWS DEFENSE
The @. K. & N. President Talks
About the Foreclosure.
Topeka Daily Capital.

Up to the present time the Rock Is
land officials have remained silent re
garding the foreclosure proceeding
recently instituted in the United
States circuit court. The counties
which hold about S2,4O0,OOO stock in
the Chicago, Kansas & Nebraska
which would become worthless if the
road is foreclosed, have not hesitated
to speak out and say that the foreclo-
sure is a very fine scheme to rob them
Of their stock The first statement
from the railroad regarding this mat
ter is given out in an interview with
President NJ A. Low. In discussing
the foreclosure. he aid:
Personally, I would prefer that
the foreclosure should not take place.
But the company has been at such an
expense in the construction of the
new road, in the building of elevators,
eating houses, stations, etc, that it
has been unable to pay the interest
due on our Indebtedness. Our mort
gage is exactly similar to any mort
gage given by an individual. It is
stipulated that in case the interest Is
not paid, the principal shall become
due and payable. This interest has
not been paid because the receipts Of
the company were Insufficient to pay
the expenses of the road and leave
enough to pay this interest. The
Rock Island company agreed to pay
80 per cent. Of its gross earnings to
stockholders, but instead of dong so
it has fallen behind on this agreement
$80O,00O We cannot set up that the
mortgage is not due, because it is,
under the terms of that instrument.
We cannot set up that the instrument
has been paid, for it hasn't. and we
haven't the money to pay 1t, The
eleventh allegation of the bill of
equity, set by the metropolitan Trust
company, says:
''That interest coupons to the
amount Of S43I, 5O7 81, attached to
said bonds and which became due and
payable on the first day Of January.
in the year 1889, were not on said
day, and have not since, been paid,
and coupons to the amount of up
wards of 100000 attached to said
bonds, which became due and payable
on the first day Of July, 1889, have
not been paid Said coupons were
not presented for payment at the
mOrtgagOr company, IN the city OF
/ New York, for the reason that said
company has never kept and per
formed and kept its covenant in the
above mentioned mortgage contained
to keep an open Office or agency in
the city of New York for the payment
of the principal and interest of and
upon the bonds above described, as
the same should become due and pay.
able, whereby it waived presentation
of the coupons at such Office or agency
as a condition precedent to the dec
laration which your orator was, by
the terms Of said mortgage, author
Ized to make, namely: that the prin
cipaI, as we'll as the past due interes
on SAID bonds, become and be dut
and payable"
''To this statement of facts we car
set up no defense or denial. While
regret that the mortgage is to be fore
closed, as any other mortgage would
be, under the same conditions O
things, I know of no way to proven
it."
; "a great many misstatements havo
been made by the press and people
in this connection" continued Mr.
Low. "For instance it has been stat
ed that our new lines of road hav,
cost $4,000 a mile, whereas, much o
it has cost US $4,000 per mile, ant
that we have built only one thousanl
miles Of road, whereas we have bull
fourteen hundred miles. The stat
of Kansas has lost nothing by tn
Chicago, Kansas & Nebraska Rail
way company coming into this state
This year we have paid more in take
. than we have received from the state
: Our taxes have been simply enormous
And should be remembered, too, tina
}. it often happens that the officers of
T railroad company get rich off Of tow
s sites, located by the companies wit
, which they are connected With u.
all the profits arising from this souFc
Y have gone in to building up the con