The herald., 1897-11-03
THE FIRST, MORTGAGE
BID IN BY THE REORGANIZATION
COMMITTEE
Attorney General McKenna Discusses
the Sale Of the Kansas Pacific
Branch

lZdtlOn committee OF the UNION SdciHC,
which yesterday bought the government
lien, the second mortgage, on the prop
erty, today purchased the first mort
gage on the same property, by which
the construction bonds were secured.
The price paid was the amount named
as the minimum bid, $50,637, ,435. The
property was bought, as was the Sec
ond mortgage yesterday. in the name of
Louis Fitzgerald and Alvin Krech, as
purchasing trustees.
The sale today was, If possible, more
uninteresting than that Of yesterday,
not over forty people being present.
The report of the sale made yesterday
was filed today in the Office of the Clerk
of the United States Court.
The report cited the order of sale is
sued by Judge Sanborn, and, in accord
ance with the provisions Of that order.
mentions that representatives of the
purchasers deposited with the Master,
within the proper time, certified check
for $2,000,0 900, as guarantee on the bid
for the property, and another certified
check for $1,364,525 to cover the sale Of
the sinking fund bonds. The Master
for sale, Louis Fitzgerald and Alvin w.
Krech, representing the purchasers, Of
fered $39, ,S83, ,281.S7 for the railroad and
its franchises and $13, ,645. .250 for the sink
ing fund bonds; that these bids were the
only ones offered, and were accepted,
the agents for the purchasers deposit
ing with the Master a certified check
for $4100,000 to guarantee the fulfill
ment Of the bids.
The fee which the Master who made
the sales Of yesterday and today will
receive for his work is estimated at
100000. 1t may be over and it may be
something under it, but it is generally
conceded that 1t will be close to that
figure.
THE KANSAS BRANCH
WASHINGTON, Nov. 2.-In discuss
ing the sale Of the Kansas Pacific rail-
road on December 18th and the asser-
tions that the government interest in
that property may have been impaired
by the sale Of the Union Pacific, Attor-
ney-General McKenna said: 1.-THE own
ership of the Kansas Pacific is part of
the committees scheme of e-organiza-
tion. The members hold liens similar
to those of the government. They can
not make them good except by the own
ership Of the road. Besides they are
owners of the first mortgage. They
must bid to make that good. But sup
pose the committee does not bid? Others
will-the government may.
"The years 1890, 1891 and 1892 are the
real tests Of the Kansas Pacific's net
income and it can be put down at 81, ,00O,-
600 and this is four per cent on $685.
100000, and five per cent on 100000, 900.
Does any sane business man believe
therefore, that the Reorganization
Committee will let it be sold for $12, ,3OO,-
900 when it will pay four per cent on
nearly twice that amount, five per cent
on nearly $8,0OO,0OO more than that
amount, owning, as the company does,
liens Junior to that Of the government
and which in such event would be to-
tai loss? Would not this policy, to use
the homely expression, be cutting off
ones nose to spite ones face?'"
THE SAFETY BRAKE
PEORIA, Nov. 2.-The law which
passed Congress March, 1893, and which
was signed by President Harrison, re-
quiring all railroads in the United States
to equip cars with automatic and power
brakes, goes into effect January /, 1898
1t is said at the headquarters of the Rail-
road Brotherhoods in this city that none
Of the railroads have fully complied with
the provisions of the law and have made
application for extension Of time. This
application will be heard by the Inter-
State Commerce Committee in Wash
ington December 1st All the five Rail-
road Brotherhoods will be represented
by the executive heads so that they may
look after the interests Of railroad en-
ployes under the law.