New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1893-07-27
THE ERIE RECEIVERSHIP.
WALL STREET NOT SURPRISED
OFFICIALS WILL NOT TALK ABOUT THE
FUTURE.
COURSE OF ITS SECURITIES on THE EXCHANGE
THE EXACT STATE OF AFFAIRS. AS Ex.

PLAlNED IN THE BILL OF COMPLAINT.
The announcement that the New-York, Laie
Erie and Western Railroad Company had gone
into its fourth receivershp was not received with
surprise in Wall Street yesterday. The stock had
been selling on a receivership basis for several
days, under the persistent rumors that such .
step had been determined upon. II was well
understood that the company had experienced
difficulty in securing loans and extensions, and
that its burden OF floating debt was waxing too
heavy for it. IL was felt too, that friendly
receivership would be far more advantageous to
the stockholders and more equitable TO the cred
itors than to wait until the company was forced
into the hands of possibly hostile receivers.
The common stock had been forced down In
the last week from 13 to 10 5-s, and it opened
yesterday, under the news of the receivership, at
0 1-2, selling down TO 81, with rally TO I-2,
which was the closing figure. The dealings in tho
stock yesterday amounted TO I2,IO4 shares The
preferred stock sold down from 30 to TO- The
second consolidated mortgage bonds, in which the
speculation has been most active closed on Tues
day night at 81. They opened at so yesterday
morning. and quickly sold down to "a. In April,
1898, these bonds sold at 0s l-2, and in the fol-
lowing August fell TO 80. Six months later they
had recovered to "a 3-4. when came the great
Jhne ssi They closed the year at about SO,
hut fell again to As IA in June. 1885 Six
months later they sold at 92, and the price
quoted yesterday is the lowest since that time.
The Erie officers were non-cOmmittal yesterday
as to the probable future of the road. The presi-
dent, John King, gave out word that the COM
pany had nothing further to say than was con-
tanned in the statement sent to the newspapers on
Tuesday night. None of the officers or directors
were inclined to talk much about the receivership,
the statement being given out that there would
be no changes in management, and that expenses
Of operating would not be cut down. because they
had been held down to the lowest limit under
the present control
The complaint on which the application for the
appointment of receivers was based was made BY
Trenor Luther Park, large holder of the bonds Of
the road. The Executive Committee of the road
joined with him. under resolutions of the Board
of Directors adopted at its last meeting, July
20, ON the ground that the prompt securing OF
the protection of tine courts was the only course
whereby the property could be saved and justice
be done TO stockholders and creditors. There
upon, told in The Tribune yesterday, Judge
Lacombe appointed as receivers John King, the
president of the road and John G.. Mccullough,
the chairman Of the Executive COMMITTEES.
The recciyership papers were filed with John
A. Shields. clerk Of the United States Circuit
Court. at 2: 80 p. H. yesterday They consisted
of the bill of complaint, the order appointing
the receivers, the answer of the defendant and
the bonds of the receivers. Judge Lacombe wac
stil In Ath~ns, N. vs. The. bill OF complaint was
brought by Irenor Luther Park against the New
York, Lake Erie and Western Railway Company.
1t reliears&d these facts: Mr.. Park owns $780,.
OOC of the bonds of the road, and on December
last loaned it $4,000 note payable on de-
mand. Payment Of this has been refused The
net earnings, which should have gone to pay tho
interest on the bonds. have been put to other
There is floating debt of $4,000, 900 due
for improvements, wages, traffic balances,
etc. Mr.. Park has been told by tho
officers that the creditors are pushing their
claims but there is no cash with which to pay
them. The creditors might attach the rolling
stock and funds and thus get ahead of the bond
holders. A large part of the floating debt CON,
sists of loans by banks and trust companies
which are unsecured secured by collateral
which has greatly fallen in value on account Of
the financial depression. \ part of the floating
debt. 100000, is due TO connecting lines, which,
If they do not receive their money. will cease TO
handle the roads business. The interest on the
consolidated mortgage bonds. S720,s due on
September |, and 81 90, see due on December |,
cannot he paid unless the road is kept running
The number of persons employed is 25,067 and
tlr monthly pay roll IS Sl,255,o2o. Hardship
will result to these people unless they are paid.
l he condition OF the road is due TO the financial
depression. The Farmers Loan and Trust Com
pany is trustee of the mortgages, but also has
other interests in the road which make its duties
and trusts varilnt and antagonistc.
John King. in his answer, admits all the aega-
tons. Bangs, Stctson, Tracy ~ McVeagh are
counsel for Mr. Park and Jennings Il Russell for
the road
This is one of the statements made in the
complaint:
. rtn, thc r.i1r do of fbn cnf1 81.
together with all their appurtenances, rolling
stock and OTHER property connected Herewith,
now in good state and condition, and the busi-
ness of the said corporation. "a now carried on,
is conducted with skill and efficiency. and with
due ngard to the public interests During the
last year its tonnage amounted 10 4,40s,50s,079
tons carried one mile, and the number of passen-
gers carried one miic amounted IA 395,9Gl 60s."
In the company's answer this admission cf
inability to meet pressing demands is made:
That the said officers and directors hitherto
have wholly failed and been unable TO provide
or secure such means with which td discharge the
said floating debt and TO meet the said rentals
and accrung interest and that the defendant il
noy powerless TO accomplish the said purpose,
and for the time being at least. is practically IN.
solvent. and that in spite of all the eNertons OF
the defendant and its officers il il now certain
that il will he unable to me,t and provide for
said rentals and accruing interest ana other eN-
penscs unless it shall lie protected from tne
embarrassment sacrifice and loss wlhoh VII Win, IN
evitahly result from the pressure OF It's hoa'ins
debt" ;..
The expenditures for IMPROVEMENTS o''p,..'o
and extensions have been great. and Il floating
debt of upward of s5,oooooo has accuwu,a,@lI; hsI;
The companys stock is Ssj,o63,60o, OF wnicn
Sc 536. 600 i, in preferred and S11,42I, 1000 in
common shares. The funded debt is Ss5,isais,,
$751; aud the annual interest charTes inciu9lns M rna;
incomes amount 10 S5,i60,Ooo. FOR 'le fsas
cndng .,eptemLer 30 1892. the gross earnings
were S2s, ,633,14I, the net s7,Is6,o3s, and the
total income $s,202,sOO. :. u.o,,.
The companys equipment, az given IN recsne
,onorts includes 66l locomotives, 600 passenger
cars and over $4,000 freight ears, with the rrIl-
ing stock held under car-trust agreements Inc
company aeo owns eight ferryboats and eishty-
cicbt steamboats,, tugs and blrges.
There were a good MANY expressions OF regret
among railroad men Yesterday Yesterday 'nat .ne Ere IRE
na;i,"sd nrc,dent was quoted as saying: Il am
sorry 20 hear il. because Erie has been under
,oi's - conservative mana gament All rail-