Vernon County censor. [volume] (Viroqua, Wis.) 1865-1955, 1908-01-15
FEDERAL JUDGE NAMES PREst
DENT sTIcKNEY RECEIVER.
UNABLE TO MEET DEBTS
Strike Given az Part Cause, and Also
Fact That Many Millions Have
Been Spent in Reconstruction and
improyement-Move is a Protect
i've One to Continue Operations.


Sanbern. in the United States circuit
court yesterday afternoon, appointed
A. B. Stickney and Chas. H. F. Smith,
both residents of st. Paul, as receiv-
ers for the Great Western railroad.
Stickney is now president of the
road
The appointment of the receivers
followed the inability Of the com
pany to meet obligations falling due in
1905, and failure to secure an extern
sion of the obligations. Loss as re-
suit of the boilermakers' strike of last
fall is given as partial cause for the
financial straits of the road. 1t was
also pointed out in the proceedings
that during the last 10 years the road
spent $19,000,000 in reconstruction.
The petition for the receiyership
was filed on behalf of the stock
holders and finance committee by John
A. Humberg of Minnesota, George p.
Meyer of New York, Ward Cumming
and Alex Wallace of Great Britain.
As soon as the petition had be Ell
fled an answer was filed on behalf
of the board of directors, who met
yesterday afternoon and voted te be-
come parry to the receivership pro-
ceedingS.
In asking for the appointing mt of
receivers, Attorney Kellogg said the
capital of the Great Western consists
OF four classes of stock, lat two OF
which need be conside, ed in the re-
ceiyership proceedings. These are
preferred "A" and debenture stock.
each of which represented so per cent
!. OF the original first mortgage bonds.
The preference of these two classes
OF stock are secured by a trust deed
TO the Manhattan Trust company of
New York There will be default in
the payment of these obligations Jan
Larry 10, said kellogg.
Owes Over Ten Millions.
Further outlining the condition OF
the road, Kellogg said the Great West
ern owes $40 ,653,413 now due or fall
ing due within the next four years,
of which notes to the amount of $545.-
600 have gone to protest
The sum, exceeding $l0,000,000, said
Kellogg, is part of the $19,000,000
spent by the Great Western in the
last 10 years and for the most part in
the last five years, In rebuilding the
road. New steel has been laid, double
tracks built, grades reduced, new
bridges and terminals constructed.
There was due last month notes to
the amount of $4,000 pounds and will
be due during the rest of January
& notes aggregating 2S3,200 pounds. The
total amount of the obligations due
during 1908 is $3,342,545.
Kellogg said the Great Western
which Is an Illinois corporation, owns
In fee without mortgage, lines of rail-
road IA Illinois, Iowa. Minnesota, Kan
sas and Missouri, and also terminal
lease OF line from ST. Paul to Mime
apoiis.
In addition, the Great Western owns
all the stock OF, and operates the
Mason City lSS Fort Dodge railroad,
about 400 miles long. This line is
mortgaged for $12000,000, 60 per cent
of its cost The Great Western also,
has lease of this line, by the terms
of which the Great Western is to
guarantee the interest on the bonds.
The Great Western places in trust a
fund of 60 per cent of the joint earn
ings of the Great Western and the
Mason City &c Fort Dodge and out of
this trust fund the Great Western
pays the operating expenses of the
Mason { ity road, the balance of the
trust fund going to guarantee future
interest On the S12,000,000 bonds. The
Great Western, however. has the use
. of this accommodating interest fund.
and there is now in the trust fund
\ s1,2S9,623. The ownership of the Ma
son City road, Kellogg pointed out,
has thus been advantageous to the
Great Western.
The Great Western also owns stock
under similar conditions of the Wis
consin, Minnesota & Pccifc. which is
bonded to the extent of S. eli 600
Fifty Pc. cent Of the ear lgs of this
-oaa go into trust fund, in which
there is now available s499,239.
The Great Western also owns the
stock of the Dekalb & Great Western,
capitalized at 100000.
Kellogg pointed out that under the
laws Of most of the states in which
the Great Western operates. the cred
itors might secure an attachment on
its property thus wrecking the road
and preventing it from fulfilling its
obligations to the public.
Primarily on this ground-the posi-
bility that it might be prevented from
performing its functions as a common
carrier-Judge Sanborn issued the
order for the receivership. He also
gave as additional ground the fact
that a judgment Of $4,000 had al
ready been secured against the road.