The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1899-04-03

Kansas City, April 1.-The receivership
for the Kansas City Pittsburg d Gulf
railroad granted in This city late last night
by Judge Gibson of the circuit court. will,
according to the company's officials, inter-
fere in no way with the operation of the
property, and the reorganization plans,
which have been making for some time
since will, it is claimed, so forward with
out delay. The receivers, all of whom
are Kansas City men, are friendly TO the
president of the road, Arthur E.. Stillwel.
who has engineered the property from
its inception. The act, they declare, is
friendly one. and was made necessary TO
head off unfriendly eastern stockholders
who contemplated similar action.
The history OF the Kansas City, Pitts
burg & Gulf railroad, and its joint enter
prises. the northern connecting lines and
the Port Arthur ship canal, contains pTac-
tically a realization of a long desired
short line to the gulf. The finishing of the
line was accomplished mainly through
the efforts of A. L. Stillwell, formerly
vice president, now president of the road.
The road grew out OF the old Kansas City,
Nevada & Fort Smith line, of which e. l..
Martin was president. The Nevada *
Fort Smith line was projected TO run
to the gulf, but only comparatively
short part of ii was finished
when Mr.. Stillwell picked up the
proposition. The road. was built dur
ing the financial crisis of 1S92-93. and was
an undertaking which few men believed
would ever De competed.
The original purpose was 10 make
Sabine, Tex, the southern terminus.
Kountze brothers of New York owned
10000 acres of land in and around Sabine.
Stiliwell made proposition 10 build his
road TO Sabine if the kountZes would
give him 81 per cent of their interests
there. The KountZes declined the offer.
Mr.. Stillwell then went to Holland and
interested Dutch capitalists in the enter
prise. 1t was finally decided to make
Port Arthur, Tex. the roads terminus.
and TO build a ship canal from that point
eight miles to Sabine lake
The last spike in the road was driven
on Sept. H. 1897 and the first through
train reached Port Arthur on that day.
While the canal was building Injunction Jun on
followed injunction to delay the work, and
1t was only finished on March . last, when
the first shipping was brought up to Port
Arthur from the gulf.
In the meantime, Mr. Stillwell assumed
the presidency of the road. +. L. Martin
being made vice president. Branch roads
becoming necessary for northern connec-
tions, the Pittsburg & Gulf company
bought and built lines giving them Omaha
and Quincy connections. These lines are
not included in the receivership. A bid
for the Alton road for Chicago entrance
was made but fell through.
Its long fight TO complete the canal
made 1t apparent several months ago
that the road would not, for the present.
be able to meet the interest upon its
bonds. and a reorganization of the whole
property was talked of. Mr.. StillWell
spent three months in New York working
on the project, and when he returned TO
Kansas City last week. it was announced
that satisfactory plans had been decided
upon and would soon be announced. The
reorganization plan was never made pup
lie in full but il included a scaling down
of the bonds, a reduction in the interest
rate, an issue of preferred stock and a re-
distribution of securities all around. 1t
became necessary. however, to extend the
date of filing of the bonds by stockhold-
ers some of whom, it was stated, de-
INJURED in the reorganization.
a few days ago it was learned. accord
ing to the local officials of the road, that
the State Trust company of New York,
which holds the roads bonds to the
amount of S23 900 900. was prepared to take
decisive action if the interest payments
of S575 co., due on April l. were not met.
Yesterday. learning. as they claim, that
certain eastern stockholders We're intent
on applying for a receivership, 1t was de-
cided by local officials of the road to
head them off.
Haven. a heavy stockholder who is favor
able to the local interests, applied for a
receivership. arousing Judge James Glib
son of the circuit court from bed at d
late hour last night to appoint receivers.
The men appointed, T. J.: Martln' hoDert
Gillian and J. Med. Trimbue. are re-
spectivelY vice president, general man
ager and general counsel of the road, and
are friendly to Mr. Stillwell. Mr.. Still
well asked not TO be Included. stating that
he believed he could better serve the
Stockholders interest if his hands were
left united.
Mr.. Stillweu says: THE uncared-for
Indebtedness of the company, including
coupons. is only 100000. or per cent
of the canital The earnings of the road
for March were 5000. far in excess of
anything that | had expected before the
canal was completed. With this amount
of Indebtedness. it will be very easy job
TO reorganize the road and put it on its
feet in a very short time.
Had the road had three or four months
more uninterrupted. it would have easily
paid its floating debt without any trouble
and would have had to take care only of
its coupons Of $4,000
The general allegation in the petition
for receivers is that the road is insolVent
and that it is unable to meet the interest
uu,1n its bonds. which fall due April /,
and which amounts to $4,000. and is I'M
able TO clear away certain other debts
which reach a total of between 100000
and S4Ol OO1