Morning journal and courier., 1893-02-21
NEWS BY TELEGRAPH. 1 From All Quarters RECEIVERS FOR READING Each to be Placed Under
 $5OO,OOO Bonds. sExATuR PLAT ACTS F1R HIMSELF He Tells Why He Applied
 for a Receiver. GENERAl. BEauRi GAED IS DEAD, Grace Kellogg Ran Away
 t., New York.
RECEIVERS ARE APPOINTED

L., New York.
 RECEIVERS ARE APPOINTED
 The Affairs of she Philadelphia an,
 Reading Road Are Brought Int 1 Court-George B. Earle Says Tha the Present Trouble was Trough About by Everyone Demanding IIi
 Money at Once-It was Bnnecessar for the Company was \ ble to Pay Is Debts.
 PHILADELPHIA, Feb 20-The sfairs o the Philadelphia and Reading road wer brought into court this afternoon. Al day there were rumors that receivers wer 1 to be appointed. The offices of the United States court were besieged by newspape men and parties interested in Reading ! matters who were esgsr 10 obtain the lates news. About 2:30 Attorney John D l Johnson and Lawyer Thomas J. Hart ap peared with Judge Dallas in chambers. 4 l few minutes past o'clock the announce l ment was made that Judge Dallas had made the appointments.
 The proceeding was brought by ex Sene tor Thomas c. Piatt of New York, holder | of third preference bonds sgainst the Reading railroad, the Philadelphia and Reading Coal and Iron company and the Pennsylvania Company for Assurance on Lives and Granting Annuities. The re ceivers appointed gre Archibald A. Me Leod, the president of the company, Chief Justice E. M. Paxson of the supreme court and Elisha F. Wilbur, ex- president of the Lehigh Valley road.
 Justice Paxson at once ssnt his resigDa- tion as chief justice to Governor Psttison
 The security of each receiver was fixed at $500, ,OOO, for which they enter their own bond. George L Crawford was appointed master. A similar bill, it was said, is to be filed at Trenton, N. J., late this afternoon. brings his bill of complaint againsG the de- fendants on his own behalf, and on behalf of all other holders of bonds of like character. The bill says that the third preference income mortgage bonds of the Philadelphia and Reading railroad amount to more than S25, 100000. These bonds were secured by mortgage delivered by the Philadelphia and Reading railroad and the Philadelphia and Reading Goal and Iron company, to the Pennsylva- mia Company for Insurance on Lives and Annuities. During the fiscal year ending November 30, 1899, the net earnings of the railroad company applicable to the interest upon the third preference bonds was suf- fcent to pay interest on the some of 5 per cent. The road prior to February 4, 1893, gave public notice that 5 per cent. on the third preference bonds would be paid Feb ruary 1, 1893.
 The complainants hold $55, 900 third preference bonds His demand for pay. ment of interest on the same was refused by the railroad company, and the Pennsyl- vania company forI insurance on Lives and Granting Annuities refused to comply with complainsnts request that it proceed to foreclose said mortgage ard to bring about a sale of the mortgagsd premises. The bill declares that the Philadelphia and Reading Railroad company, and the Philadelphia and Reading Coal and Iron company. though possessed of ample property, if the same be iudiciously administered and held together, to pay all their indebtedness are ipsolvent In the sense that they were without funds in the shape of cash or as sets convertible into cash, sufficient to pay their indebtedness actually matured, or which will within short time mature.
 The present condition of the companies is largely the result of demands of hsans for which there is ample security pledged with the lenders but which loans the holders thereof are unwilling st the pres ent time to renew. The complainant, therefore. asks that the lights of third preference bondholders be ascertained that the Pennsylvania company may be re- ouired to institute foreclosure proceedings and take possession of the property And operate the same till the courts fnal de- cree, and that receiver or receivers be appointed to take charge of the property The bill asks that when the amount is ss- certained decree be entered directing the Philadelphia ami Reading railroad to pay the amount due the third preference bond holders and that in default of said pay ment the mortgaged property be sold un- der foreclosure.
 The order appointing ths receivers di- rects them to continue tho business of the companies, and enjoins the defendants and all other persons from interfering with the receivers.
 President Mcleod of the Reading denied himself to all newspapermen to day, but late this afternoon announced indirectly that he would prepare statement of the compauy's troubles. He, however, gave no intimation when this would be done, but 1t is thought probable It will bs given out tomorrow.
 George H. Earle, jr., president of the Finance Company of Pennsylvania and commercial agent of the road, said this hlt IuoU t1c rluduCo COmp phuJ uhs from $9, ,00O, 900 to $1O, GOO, ,O0O worth of Reading coal on hand, upon which no ad- vances have been made. This amount MT. Earle declared Is enough to pay the Read | ing's floating debt twice over. When | asked the cause of the trouble be said 1t was due to everybody demanding his ! money at once, which was unnecessary, l for the company was able to pay the l debts.
 ! Immediately after the meeting this morning of the directors of the Reading railroad the directors of the Lehigh Valley road met and discussed the situation. Nc | definite action was taken, but 1t is un derstood that they have consented to tho Reading reeeivership, ss the lease requires and that it is the intention that the Read ing Lehigh Valley combination shall con tinue as heretofore.
 President Wilbur of the Lehigh Valte, said to reporter that there was no chang, in the policy of his road towards the Read ing. MT. Wilbur said the Reading hat met all its obligations towards the Lehigl
 Valley 50 far and that it did not owe tn
 latter road penny.
 It Ia possible in event of the Readin,
 default in the payment of the rental of th
 Lehigh Valley, that the lease may bs can
 celled. The first payment of the pc ! CoAt. luCoIcbe to Uo pnlh uoly, VI
 Reading to the Lehigh Valley falls due O
 the 31st of March, and amounts to $705
 S59, the same bsing equal to If per cent
 on the existing outstanding capital stoc
 of the Lehigh Valley.
 An Inquirer reporter saw President Mt
 Loed at his hotel this evening He was
 good spirits. He said: "I am very SOFT
 that we were driven to the necessity of
 recsivership, but 1t was the only thing
 do. Our credit was attacked in a way thi
 made 1t impossible for us to meet our obl
 gations, and we had the receivership e
 tablished. I wanted to see if the compan
 could be made self-supporting."
 The recent heavy operations in Readir
 suggests an interesting speculation regar'
 ing the amount of money the friends
 Reading require to carry them on. In tl
 first place, that 50,OOO shares of Bostc
 and Maine which they are reputed to ha'
 bought at 150 called for $7, 500, 900. The
 also purchased 1O5, 900 shares of New En
 land at about 50, making $5. 250, 900 nor
 In addition to this they also bought 25 ,6'
 of Connecticut River railroad stock at 21
 which represents $5, ,500, 900, or grand
 tai of SIS, ,250 ,000. This money was mos
 ly borrowed and carried in loans.
 ! lo oo{J x1,ox Pao5ipr &h{rJ {,oor