The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1893-12-24
TOO DEEPLY IN DEBT
The Great Santa Fe Railway Sys-
tenn i'm Receivers Hands.
Federal Judge Caldwell Places the Road
in Charge of Messrs. Reinhart,
McCOOk and Wilson.
1T OWES ABOUT S24O,OOO.OOO
And Cannot Pay Three Millions of
Interest Due Oh Jan. l.
Over 5000 Miles of Line InyOlved-Ac-
tion Taken OH Complaint of New
York Trust Companies.
1T OWES ABOUT S24O,OOO,OOO

LITTLE ROCK, Ark. Dec. 23-The ex-
pected in the railroad world happened to-
day. The Atchison, Topeka & Santa Fe
and st. Louis & San Francisco railroads
and branches. comprising the Santa Fe
system proper, have been placed in the
hands of three receivers, the order being
made by United States Circuit Judge II. c.
Caldwell in chambers in this city at $50
O'Clock this evening. The application was
made by the Union Trust Company, of
New York. trustees for the bondholders of
the Atchson, Topeka & Santa Fe, and the
Mercantile Trust Company, of New York,
trustees for the bondholders of the St
Louis & San Francisco.
Although the press OF the country has
anticipated the result for some time not
until the death of Chairman George c.
Magoun, last week, was any immediate
action contemplated. The first intimation
of decisive action was received at O'Clock
this afternoon, when a special train ar
rived over the Iron Mountain, with prom
inent railway attorneys and officials on
board, who fastened to the federal court
house and were soon clOseted with United
States Circuit Judge II. G. Caldwell who
had arrived from St Louis the day be-
fore. The party included George f. Shar-
rett, clerk of the United States circuit
of Kansas; George r. Peck, general So
licitor of the Atchison, Topeka & Santa
Fe; Il. ID. Kenna, general solicitor of the
st. Louis & San Francisco; II. l.. Nor
rill, general manager and second vice pres
ident of the Frisco" Charles b. Alexan-
der and w. w. Green, of the firm of Alex
ander & Green, New York, counsel for the
and A. A. RossingtOn, OF Topeka, solicitor
for the Union Trust Company, of New
York
The party remained closeted with Judge
Caldwell behind closed doors until CLOCK,
when an order was agreed upon appoint
ing three receivers for the Santa Fe, as
follows: G.. w. Reinhart, president of the
Santa Fe system; j. j. McCook, general
counsel of the Santa Fe system. and Jo-
seph c. Wilson. clerk of the United States
District Court at Topeka, Kan. The latter
was a compromise receiver, the railroads
having recommended Reinhart, McCook
and George c. Nickerson, the latter a di-
rector of the system, but he objected
TO by the complainants.
The receivers met with no resistance on
the part of the railroad companies, and an
agreement was soon reached
DEBT OF THE COMPANIES.
The bills in both cases-that of the Santa
Fe and "Frisco"-showed that the lines
were heavily involved with maturing OBJ
legations coming soon. that the interest
due Jan. l could not be paid, and that the
mortgage would be foreclosed. In both
cases the complainants bills went elab-
orately into figures. and were very full and
voluminous. The bonded indebtedness ag-
gregates $252, 100000, as follows: $l5O,OO0,0OO
first mortgaged bonds; $77.000,0O0 class 'A''
second mortgage bonds; s5,000,0O0 class "B''
second mortgage bonds. The interest due
Jan. / will aggregate nearly 100000 and
the floating debt is about S5.OOO.OOo. making
a total liability of about S2iO,G0,Ge0
J. W. Reinhart and j. j. McCook, two
of the receivers, are well known in rail-
road circles throughout the country; the
other receiver. Joseph C. Wilson, has been
twice Mayor of Topeka, and is considered
a level-headed man.
A supplementary bill will likely be filed
ut Topeka, JAM s. which will amount TO
foreclosure of the bonded indebtedness in
which event the branch lines, which have
been sapping the life blood of the main
lines will be Topped off. The order in each
of the two cases is the same, and directs
rected TO take immediate possession If ali
the railroad and properties. including 9.3i6
miles of operated lines, and to run, manage
and operate them and to execute the au-
thority and franchises of the roads and con-
duct systematically their business" The re-
ceivers are ordered to execute each bond
for $4,000 within the next twenty days,
and the order contains an injunction re-
curing the roads to be turned over to the
receivers. The order contains full directions
to the receivers TO employ and discharge
employees, and TO bring suits and have au-
thority over the moneys that come in their
hands; TO pay expenses for operating the
property amounts due for operating the
roads and for track service, car mileage and
taxes. and provides that it is made on the
express condition that ali legal debts now
due and which were contracted in the ope-
ration of the road. including damages,
money, and work furnished and done in the
construction, repair and equipment OF the
roads, shall be q first lien on the property,
including all liabilities TO persons or cor
porations who may become surety for the
company or indorsers or guarantees for it.
The receivers are also required to pay judg-
ments which are found against them which
are not appealed from, and all payments of
the receivers are to be audited and allowed
by the receivers, so that they need not
come into court on every occasion. The lien
so created for such claims shall continue
unvacated. The complainants are required
to prosecute the suit to final decree without
delay, otherwise the court Will discharge
the receivers.
The party left on the "CannonbalP' al 7:35
for ST. Louis, Clerk Sharratt taking the pa
properly filed in the United States Circuit
Court.
General Manager Frey's Views.