Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1907-07-02
RESCIND LEASE ON
c. B. & Q. ROAD
PRESIDENT HARRIS ANNOUNCES
THAT BURLINGTON RAILROAD
RESUMES POSSESSION
is EFFECTIVE TODAY
Railroad Corporation Deal Is Not Ex
actly Understood by Railroad Men,
But a Big Deal Was Probably Plan
ned by Hill and Dropped.


But Big Deal Was Probably Plan.
ned by Hill and Dropped.
Chicago, July Much speculation
IN local railway circles was occasioned |
Yesterday by the following statement,
issued from the office of George 3.
Harris, president Of the Burlington sys.
| TEN:
1T IS announced that the lease of the
Chicago. Burlington 8 Quincy railroad
70 the Chicago, Burlington & Quincy
| halfway companies has been rescinded
by mutual agreement Of the parties
thereto, and that the Chicago, Bur.
lington & Quincy Railroad company
VIII today resume possession of the
property, and will thereafter operate
the same in its own name.
The railway company was organ.
lied in 1901. in the interest of the
railroad company. No bonds or other
obligations have been issued by the
new company, and there is nothing in
the way Of vacating the lease and re.
storing the property to the old com.
\ pany.
The old company takes over all the
property and assets of the new com.
pany and assumes all Of it's obliga
tions. No change in the capitalization
of either company has been made"
President Harris was not In the city
yesterday, and other officials of the
Burlington protested to be ignorant OF
the reasons for the change in the cor.
porate ownership. The only opinion
any Of the officials would express was
that as the two companies were prac.
= 1n lvyy = t,1 It'll.
the accounting" to discontinue the rail.
way company
Officials Of other roads freely ex
ton Of the lease Of the Chicago, Bur.
lington & Quincy railroad to the Chi
cago, Burlington & Quincy Railway
company indicated that some big finan.
cial scheme of James ]. Hill had mis-.
carried or had been abandoned by him.
i When E. H. Hartman and his asso.
ciates bought the Chicago & Alton
railroad they leased it to the Chicago
& Alton Railway company on practic
ally the same basis as ]. J. Hill leased
the Chicago, Burlington & Quincy
Railway company The Hartman syn
dictate promptly proceeded to increase
the capitalization of the Alton road
from about $4,000 to $4,000 per
mile, making profit of many millions
from the sale of the new stock and
bonds.
!, Whether ]. j. Hill expected to finan
cially reorganize the Burlington after
the manner Of q. H. Hartman on the
Alton is question which many rail.
way men asked yesterday, but could
not answer. If Mr. Hill had such a
plan he never carried it out, as not
a single share of stock or bond was
issued by the Chicago, Burlington &
Quincy Railway company.
The official reports show that this
\ company was incorporated by ]. ]
Hill and others in Iowa October 16
A 1901, after they had secured by pur.
4 chase practically all the stock of the
4 Chicago, Burlington & Quincy railroad
& More than 81 per cent Of this stock
was transferred to the Great Northern
4 and Northern Pacific railroads, and
4 they still own it.
The Chicago, Burlington & Quincy
Railway company leased the Chicago
Y Burlington G. Quincy railroad fol
1 ninety.nine years from September so
1901 at rental of, first, the Interest
on the funded debt; second, the sink
ing fund charges third, the taxes anG
fourth dividends at the rate Of pei
cent per antlNl on the capital stock
The dividends on stock on the rail
q road were paid directly to the Great
Y Northern and Northern Pacific rail
roads, which Jointly guaranteed II
q payment of the interest on the bonds
h of the Burlington railroad. Its tota
capital stock is $110,S40000 and the
total bonds issued is $174,000,000.
" The original plan of James j Hi
n to nave the Northern Securities com
u pany hold a majority of the stock o
y the Great Northern, Northern Pacific
"a and Chicago, Burlington & Quinc.
"a Railw1,- company stock was defeated
n when the courts ordered the dissolu
81 ton of the Northern Securities be
cause il was in violation of the anti
81 trust law.
q Why the Chicago, Burlington {
M Quincy Railway company has givel
81 up its lease Of the Burlington railroa,
s. may remain a secret until James j
"A Hill is willing to disclose the facts
81 About the only thing apparent now |
Il that it indicates that one of his pre-
81 iects has miscarried or has bee
b abandoned The public has not suffer
IL ed and will not, as no stock or bond
~ of the Iowa corporation have ever bee
@ issued, and the stock Of the origina
IA Burlington company Is held in tn
n treasures OF the Great Northern an
81 Northern Pacific companies.