as that which had agreed to advance the money for reorganization
expenses.
[528] Chron. 65:730, 1897; Report of Commissioner of Railroads, 1897,
p. 9.
[529] Ry. Age, 24:897, 1897.
[530] Report of the Commissioner of Railroads, 1898, p. 9.
[531] The entire indebtedness of the Kansas Pacific to the Government
was $12,891,900. After the sale the Government brought suit for the
balance, but received a decree for $821,898 only.
[532] Cf. H. R. Meyer, The Settlements with the Pacific Railways,
Quarterly Journal of Economics, July, 1899. The receivership records
have been published in fourteen volumes.
At its final meeting in 1898 the reorganization committee nominated
a proxy committee of five members “to permanently represent, at the
annual and other meetings, such holders of common and preferred stock
as (should) desire to entrust their proxies to the said committee
for the purpose of maintaining the management and general policies
inaugurated by the reorganization committee.” This took the place of a
compulsory voting trust.
[533] Thomas Warner Mitchell, The Growth of the Union Pacific and its
Financial Operations, Quarterly Journal of Economics, vol. 21, p. 569,
1907.
[534] Besides $824,910 in Northern Securities stubs.
[535] See B. H. Meyer, A History of the Northern Securities Case,
Bulletin of the University of Wisconsin, July, 1906.
[536] As in the Southern Pacific purchase the acquisition of the
Northern Pacific stock was financed mainly by the issue of convertible
collateral bonds. Some $30,000,000 besides, it is supposed, were
borrowed from the banks.
[537] Testimony of Mr. Harriman before the Interstate Commerce
Commission. It is true that the Northern Securities stock held by the
Union Pacific system had been pledged as security for an equal amount
of Oregon Short Line 4 per cent and Participating 4s, and that when
these bonds were refunded there was pledged for the new issue whatever
the Union Pacific interests should receive in exchange for their
Northern Securities holdings, and any other shares or bonds at not
exceeding 80 per cent of their appraised value. But the purchase of the
Southern Pacific and of the Northern Pacific stocks had been previously
financed by an issue of convertible collateral bonds for which other
collateral had been pledged. From 1904 on, the rising price of Union
Pacific stock made conversion desirable and rapidly released the
securities back of the original issue. These released securities, with
$18,000,000 Southern Pacific preferred stock paid to the Union Pacific
in 1904 (with $2,460,960 cash), proved a sufficient pledge for the
Oregon Short Line refunding bonds, and the Great Northern and Northern
Pacific stock shares were therefore free for other purposes.
[538] Annual Report, 1907. See also Interstate Commerce Commission,
Report in the Matter of Consolidations and Combinations of Carriers,
Relations between such Carriers, and Community of Interests therein,
their Rates, Facilities, and Practices, 12 I. C. C. Rep. 319.
[539] The Union Pacific acquired a half-interest in the San Pedro, Los
Angeles & Salt Lake Railroad Company in 1904.
[540] Recent reports suggest that a holding company is to be formed,
which will take over the securities now owned by the Union Pacific
Railroad.
[541] Dividends upon Union Pacific Railroad Stock:
_Per Cent_
1898 1899 1900 1901–4 1905 1906 1907
Common 3½ 4 4½ 8 10
Preferred 1½ 3½ 4 4 4 4 4
[542] Entitled An Act granting Lands to aid in the Construction of a
Railroad and Telegraph Line from Lake Superior to Puget’s Sound, on the
Pacific Coast, by the Northern Route. Statutes at Large, 38th Congress,
1st Session, chap. 217.
[543] To make possible the selection of indemnity lands.
[544] Josiah Perham was the prime mover at first and after him certain
Boston capitalists were prominent.
[545] Ellis Paxsom Oberholtzer, Life of Jay Cooke. Philadelphia, George
W. Jacobs & Company, 1907. See also Smalley, History of the Northern
Pacific.
[546] The notes were put on the market at par, though sold to the
syndicate at 88.
[547] Chron. 18:16, 1874.
[548] R. R. Gaz. 6:135, 1874. The indebtedness of the Northern Pacific
to Jay Cooke & Co. amounted to about $1,500,000.
[549] R. R. Gaz. 6:496, 1874; Congressional Record, 43d Congress, 1st
Session, May 11, 1874, pp. 3749, 3773.
[550] Net earnings “shall be construed to mean such surplus earnings
of the said railroad as shall remain, after paying all expenses of
operating the said railroad and carrying on all its business, including
all taxes and assessments and payments on incumbrances, and including
the interest and sinking fund on the first mortgage bonds, the expenses
of repairing or replacing the said railroad, its appurtenances,
equipments, or other property, so that the same shall be in high
condition, and of providing such additional equipment as the said
Company shall deem necessary for the business of said railroad.” Annual
Report, 1876, p. 45.
[551] Annual Report, 1876; Chron. 20:522, 1875; Ibid. 21:15, 1875.
[552] Annual Report, 1876.
[553] R. R. Gaz. 7:330, 1875. Deposits of bonds kept coming in, until
on June 30, 1879, when the rights of conversion into preferred stock
expired, there remained outstanding but $529,000. Annual Report, 1879.
[554] These lands were reserved for the time because some of them had
not been surveyed, and others which had been surveyed had not yet been
deeded to the company owing to a dispute with the Interior Department
over the payment of the costs of the surveys. R. R. Gaz. 7:340, 1875.
[555] R. R. Gaz. 7:420, 1875.
[556] Annual Report, 1881.
[557] Annual Report, 1882, p. 13.
[558] Henry Villard, Memoirs, vol. 2, pp. 272–94.
[559] Memoirs, p. 297.
[560] For the manner in which the Northern Pacific directors attempted
to keep Villard from obtaining control, see notices in the Chronicle
for 1881.
[561] See First Annual Report of the Oregon & Transcontinental Company;
R. R. Gaz. 14:516, 1882 (contains statement of organization and
purposes).
[562] Annual Report, 1883. Arrangements had been made with the Oregon &
Transcontinental Company for necessary advances in order to avoid the
accumulation of a large floating debt.
[563] R. R. Gaz. 15:716, 1883. For attempted explanation of this
deficit, see Villard’s statement to the stockholders in 1884, just
after his retirement from the presidency.
[564] Memoirs, p. 315.
[565] Villard was back in control by 1887 with the backing of German
capital.
[566] In 1886 the Oregon Railway & Navigation was obtaining 28 cents
per 100 pounds for its haul of 213 miles from Wallula Junction to
Portland, leaving to the Northern Pacific 28 cents for its haul of 1699
miles from St. Paul to Wallula. R. R. Gaz. 18:681, 1886, Report of
Vice-President and General Manager Oakes.
[567] For the negotiations between the Union Pacific, the Oregon
Railway & Navigation, and the Northern Pacific from 1885 to 1889, see
the financial papers of that time and the reports of the railroads
concerned.
[568] In 1890 it was reorganized as the North American Company.
[569] Annual Report, 1888, p. 8; Chron. 44:752, 1887; Ibid. 44:782,
1887.
[570] The preponderance of west-bound freight prior to 1888 forced the
Northern Pacific to carry grain east-bound at very low rates in order
to fill its empty cars. See Daniel Buchanan vs. the Northern Pacific
Railroad Company, 5 I. C. C. Rep. 7.
[571] For immigrant traffic into the Northwest see Ry. Rev. 28:163,
1888.
[572] The capital stock of the Cœur d’Alene Company was $1,000,000, and
there were $360,000 in 6 per cent guaranteed bonds outstanding. Ry.
Rev. 28:551, 1888.
[573] Interest due and accrued, bills payable and accounts payable for
the following years were:
1884 $6,941,513
1885 4,748,235
1886 4,959,406
1887 6,504,274
1888 9,287,616
1889 7,858,261
[574] Annual Report, 1889.
[575] Annual Report, 1889; Chron. 50:279, gives text of mortgage.
[576] Ry. Rev. 29:541, 1889. In fact the issues were all made at 5 per
cent.
[577] Annual Report, 1890. For answer of directors see R. R. Gaz.
21:759, 1889.
[578] Chron. 51:539, 1890. The point of view of the stockholders is
briefly but clearly set forth in a circular issued by Mr. Robert
Harris, chairman of the board of directors. Ry. Age, 14:658, 1889.
[579] In 1919.
[580] Evidence of this appears in the $10,000,000 reserved for premiums.
[581] Memoirs, vol. 2, p. 336.
[582] Annual Report, 1889; R. R. Gaz. 21:318, 1889. The Wisconsin
Central divided its gross earnings into two parts, 65 per cent and 35
per cent; retained 35 per cent for its own use, and appropriated 65
per cent for operating expenses and for certain improvements tending
to reduce operating expenses. When operating expenses were less than
65 per cent the Wisconsin Central was to pay over one-half of the
difference to the Northern Pacific in consideration of the business
which the latter gave it. When operating expenses exceeded 65 per cent
the Wisconsin Central was to pay not exceeding 2½ per cent of this
excess out of its 35 per cent, and to divide one-half of any excess of
operating expenses above 67½ per cent equally between the Wisconsin
Central and the Northern Pacific. The Northern Pacific, however, was
not bound to pay its half of such excess except out of future profits
received under the contract.
[583] Annual Report, 1890. For a brief statement of the complicated
relations between the Wisconsin Central, the Chicago & Northern
Pacific, and the Chicago & Great Western, see R. R. Gaz. 22:350,
1890. Terms were agreed upon with the Baltimore & Ohio for the use
of the Chicago terminals of the Chicago & Northern Pacific, by that
corporation. Annual Report, 1891.
[584] Annual Report, 1890, p. 14; R. R. Gaz. 21:318, 1889.
[585] Chron. 54:845, 1892. Resolutions adopted at the stockholders’
meeting were in substance:
“_Resolved_, That the $3,347,000 of consolidated mortgage bonds now
deposited with the Farmers’ Loan & Trust Company as trustee for the
preferred stockholders ... be not sold below 90 and accrued interest.
“_Resolved_, If all the bonds be not sold as above, and smaller lots
can be disposed of at 90 and interest, then the Directors may sell
enough to make up the deficiency any year between the dividend actually
paid to preferred stockholders and the 4 per cent which should be paid.
“_Resolved_, If 4 per cent dividends or more are declared by the Board
of Directors any year, then enough bonds shall be sold to produce 1 per
cent additional dividend to be paid to preferred stockholders.” Chron.
55:679, 1892.
[586] Ry. Rev. 32:687, 1892. Members were, Henry Clews, Brayton Ives,
Frank Sturges, William Solomon, and Jay Cooke, Jr.
[587] Ry. Times, 63:275, 1893; Chron. 56:332, 1893.
[588] Ry. Rev. 33:143, 1893; Chron. 56:362, 1893; Ry. Times, 63:302,
1893; Ibid, p. 360. See also R. R. Gaz. 25:161, 1893.
[589] Memoirs, pp. 359–60.
[590] Among others the investigating committee protested loudly against
a sale. Ry. Rev. 33:127, 1893.
[591] Ry. Times, 65:595, 1893.
[592] Chron. 56:1017, 1893; R. R. Gaz. 25:398, 1893.
[593] The heaviest subscribers were the Rockefellers and Villard and
his friends.
[594] Annual Report, 1893; Ry. Times, 64:290, 1893.
[595] Criticism was aroused by the alleged fact that all three
receivers were adherents and virtually protégés of Henry Villard. Ry.
Times, 64:290, 1893. See also Smalley, p. 291.
[596] Except that Henry Stanton of New York was to be the Eastern
receiver for all the branches.
[597] Ry. Times, 64:337, 1893.
[598] These officers had resigned in consequence of the non-payment of
their salaries.
[599] Ry. Rev. 33:587, 1893.
[600] Chron. 59:697, 1894.
[601] Ibid. 57:765, 1893.
[602] Ry. Age, 19:40, 1894.
[603] Ry. Age, 23:154, 1897.
[604] Ry. Rev. 33:783, 1893; Chron. 57:1123, 1893; Ry. Age, 19:11, 1894.
[605] Ry. Age, 19:89, 1894.
[606] Ibid. 19:231, 1894.
[607] R. R. Gaz. 26:294, 1894; Chron. 58:683, 1894.
[608] R. R. Gaz. 26:642, 1894; Chron. 59:473, 1894.
[609] Chron. 59:738, 1894; Ibid. 59:697, 1894.
[610] This is not to be explained by more liberal expenditures by the
receivers on maintenance of way and equipment, for the sums applied to
both these purposes were materially less in 1894 than in 1893.
[611] Ry. Times, 65:87, 1894.
[612] Ibid. 65:38, 1884.
[613] R. R. Gaz. 27:160, 1895.
[614] For opposing circulars by the Livingston Committee and by
the directors see Ry. Rev. 35:55, 1895. On February 20, 1896, a
Stockholders’ Protective Committee was appointed, consisting of
August Belmont, Brayton Ives, and George R. Sheldon of New York, and
Charlemagne Tower, of Philadelphia. Chron. 62:365, 1896.
[615] Chron. 60:930, 1895.
[616] R. R. Gaz. 27:590, 1895.
[617] For the use of trackage and terminals at and between St. Paul and
Minneapolis. See Ry. Age, 20:161, 1895; Ibid. 20:198, 1895; Ry. Rev.
35:209, 1895.
[618] Chron. 61:325, 1895.
[619] Pearsall _vs._ Great Northern Railway Company, 161 U. S. 647.
[620] Ry. Rev. 35:461, 1895.
[621] Proceedings were begun in the Seattle court in August. See Chron.
61:241, 1895; Ry. Age, 20:394, 1895; Ibid. 20:418, 1895; Ibid. 20:430,
1895.
[622] Up to this time such accounts had been filed in the Milwaukee
court.
[623] Ry. Age, 20:442, 1895; Ry. Rev. 35:503, 1895.
[624] Ry. Age, 20:478, 1895; R. R. Gaz. 27:648, 1895.
[625] Chron. 61:611, 1895; Ry. Times, 68:442, 1895.
[626] Justices Brown, Harlan, Brewer, and Field.
[627] “We are of the opinion,” said Justices Field, Harlan, and Brewer,
“that proceedings to foreclose a mortgage upon lines extending through
more than one district should be commenced in the Circuit Court in
which the principal operating offices are situated, and in which there
is some material part of the railroad embraced by the mortgage. Such
court should be the court of primary jurisdiction. But in view of the
fact that a portion of the line of road owned by the Northern Pacific
Company is within the State of Wisconsin, and that at the time of the
filing of the creditors’ bill the Northern Pacific Railroad Company
was operating a road through the Eastern District of Wisconsin,
although such road was under lease to it for 99 years; and in view
of the further fact that the railroad company assented to the action
of the Circuit Court for the Eastern District of Wisconsin in taking
jurisdiction, and as such jurisdiction has been recognized by the
Circuit Court in every district ... for the space of about two years,
we are of the opinion that the Circuit Court for the Eastern District
of Wisconsin has jurisdiction to proceed to a decree of foreclosure
which will bind the mortgagor company and the mortgaged property, and
ought to be recognized by the Circuit Court of every district along the
line as the court of primary jurisdiction.” Chron. 62:234, 1896.
[628] Justice Field of the Supreme Court declined to exercise his
authority to remove Burleigh, intimating that the existing arrangement
was satisfactory. Ry. Age, 21:174, 1896.
[629] The existing general mortgage covered only the main line, land
grant, and equipment so far as owned by the company.
[630] See Circular of the Reorganization Committee, or Chron. 62:550,
1896; Ry. Times, 69:287–8, 1896.
[631] In addition there were $73,875 of unpaid interest on receivers’
certificates.
[632] See R. R. Gaz. 28:219, 1896, for editorial on plan.
[633] Ibid. 28:349, 1896.
[634] Chron. 62:1139, 1896; Ibid. 63:155, 1896.
[635] Chron. 62:990, 1896; Ibid. 62:1041, 1896.
[636] Chron. 62:1088, 1896.
[637] Ry. Times, 69:511, 1896.
[638] Chron. 62:779, 1896.
[639] Curiously enough the sale did not extinguish the old Northern
Pacific Railroad Company. Some 25,000 or more shares did not assent to
the reorganization plan and are still outstanding. They assert that it
is because of them that the old organization is kept up.
[640] From 1898 to 1907 inclusive. This does not include advances to
subsidiary companies, which have aggregated nearly $20,000,000.
[641] The average train load in 1907 was 406.77 tons; that in 1898 was
264.59 tons.
[642] Chron. 83:1524, 1906; Ibid. 84:103, 1907. The new issue is to go
in part for improvements previously made out of income. The directors
have adopted the questionable policy of charging all such expenditures
to capital account.
[643] For this and for an account of the Northern Securities episode
see B. H. Meyer, A History of the Northern Securities Case, Bulletin of
the University of Wisconsin, July, 1906.
[644] Annual Report, 1901.
[645] The dividends declared by the Northern Pacific Railway have been:
1898 1899 1900 1901 1902 1903 1904 1905 1906 1907
Common stock 2 4 4 5½ 7 6¾ 7 7 5¼[A]
Preferred stock 5 4 4 4 1
[A] Including August.
[646] Poor’s Manual, 1878. The name was first the Rock Island & La
Salle Railroad Company, and was changed to the Chicago & Rock Island
Railroad Company in February, 1851.
[647] Chron. 30:356, 1880.
[648] Chron. 30:616, 1880.
[649] For the attempt of Vanderbilt to get representation on the board
see the pamphlet issued by the Rock Island Company at this time; also
R. R. Gaz. 16:420, 1884; Annual Report, 1884; Ry. Age, 9:428, 1884.
[650] R. R. Gaz. 16:891, 1884.
[651] R. R. Gaz. 16:709, 1884.
[652] Annual Report, 1891.
[653] Ibid. 1889.
[654] Ibid. 1892.
[655] Annual Report, 1892.
[656] “With the Chicago, Rock Island & Texas Railway Company this
company has financial and traffic agreements under which the Chicago,
Rock Island & Pacific Railway Company supplies all funds necessary to
build and equip the road in consideration of receiving all the stock
and all of the bonds of the Texas company, the latter issued at the
rate of $15,000 per mile of completed road and additional for equipment
to an amount equal to cost of the same, not exceeding $5000 per mile.”
Annual Report, 1893.
[657]
Bonded indebtedness, 1900, amounted to $18,395 per mile.
Capital stock, 1900, amounted to 13,711
-------
$32,106 per mile.
[658] Ry. Age, 33:186, 1902.
[659]
Stock quotations: June 1, 1901 156¾
July 1, 1901 155¾
July 12, 1901 132½
[660] The par was $50 for both common and preferred.
[661] R. R. Gaz. 34:562, 1902.
[662] This line had been leased before, and the majority of its stock
and that of the Rock Island & Peoria had been owned by the Chicago,
Rock Island & Pacific.
[663] See financial papers for 1897.
[664] Annual Report, 1903.
[665] Quotations of securities:
_Jan. 2, _Jan. 2, _Jan. 2,
1903_ 1904_ 1905_
Rk. I. Co. common stock 49 22¾ 36¼
Rk. I. Co. preferred stock 83½ 61 84
C., R. I. & P. R. R. Co. 4 per cent bonds 87⅜ 66¾ 81⅝
[666] Chron. 75:212, 1902.
[667] Ry. Age, 34:301, 1902.
[668] R. R. Gaz. 34:750, 1902.
[669] Previous to this the stockholders of the Chicago, Rock Island &
Pacific Railroad Company had approved the deal, had authorized the new
bonds of 1913, and had voted to increase the capital stock of their
company $20,000,000, which increase was turned into the treasury of
the Rock Island Company of New Jersey, in return for an equal amount
of this latter company’s stock. It is worth noting that the purchase
was to be made by Railroad Company and not by Rock Island Company
bonds, although the desire of the management was ultimately to see the
indebtedness of all subsidiary roads replaced by Rock Island Company
bonds.
[670] Ry. Rev. 43:408, 1903.
[671] Chron. 76:1192, 1903.
[672] Ry. Age, 36:1, 1903.
[673] Ry. Age, 37:1153, 1904.
[674] See the Annual Report of the St. Louis & San Francisco Railroad
for 1904.
[675] A consolidation in 1905 of the Arkansas Southern Railroad
Company, the Arkansas & Louisiana Railroad Company, and the Little Rock
& Southern Railroad Company. See the Annual Report of the Chicago, Rock
Island & Pacific Railroad Company for 1906.
[676] See letter from Mr. C. W. Hilliard, vice-president of the
Colorado Southern, New Orleans & Pacific Railroad, and comptroller of
the St. Louis & San Francisco Railroad Company, in Chron. 84:507, 1907.
[677] After October, 1906.
[678] Ry. World, 51:531, 1907.
[679] Chron. 85:468, 1907.
[680]
_Number of _Name of _Number
_Date_ reorganizations_ reorganization_ of plans_ _Foreclosures_
1900-4 1 Rock Island 1 No
1895-9 6 Atchison 2 Yes
Baltimore & Ohio 1 No
Erie 3 Yes
Northern Pacific 2 Yes
Reading 4 Yes
Union Pacific 3 Yes
1890-4 2 Atchison 1 No
Richmond Terminal 3 Yes
1885-9 3 Atchison 1 No
Reading 6 No
East Tennessee 2 Yes
1880-4 3 Reading 5 No
Rock Island 1 No
Union Pacific 1 No
1875-9 2 Erie 4 Yes
Northern Pacific 1 Yes
1859 1 Erie 1 Yes
-- --
18 42
Carl Snyder, American Railroads as Investments (N. Y., The Moody
Corporation, 1907), offers, _inter alia_, an analysis of the results of
operation of the railroads considered in the text.
[681] The lien of a floating debt is inferior to that of a bond when
unsecured, except as it represents arrears of wages and payment for
supplies. But it is usually very well secured.
[682] In the case of the Rock Island in 1902 there was no floating
debt to be considered, while in 1885 the Erie funded overdue coupons
and issued a 6 per cent mortgage on its Jersey City terminals to cover
accumulated liabilities, but did not disturb its outstanding mortgage
bonds, and cannot, therefore, be said to have reorganized.
[683] This was, in fact, a prominent feature of the reorganizations
between 1893 and 1898. The Atchison surrendered the St. Louis & San
Francisco; the Erie absorbed the New York, Pennsylvania & Ohio into its
system instead of continuing the lease thereof; the Northern Pacific
surrendered the lease of the Wisconsin Central and cancelled various
unprofitable traffic contracts and traffic agreements; the Reading
gave up the Lehigh Valley and its New England extensions; the Southern
reduced its mileage by over one-half; and the Union Pacific shrunk from
7674 miles in 1892 to 5399 in 1899.
[684] See Interstate Commerce Commission: In the Matter of
Consolidations and Combinations of Carriers, etc., 12 I. C. C. Rep. 319.
[685] Testimony of C. F. Adams, United States Pacific Railway
Commission Report, 1887, vol. 1, p. 45.
[686] “It is only by the fullest knowledge of the affairs of the
company that a correct judgment of the best manner of meeting its wants
can be formed, and there is no other practicable way to manage the
business of the company to its best advantage than for the stockholders
to elect directors worthy of confidence, and to leave the management to
them.” Annual Report, 1887, Robert Harris, President.
[687] In the case of the Atchison, old income bonds were retired by
new second mortgage bonds, with the result that the aggregate value of
creditors’ holdings was largely increased.
[688] Speech at Columbus, Ohio, August 19, 1907.
[689] Forum, September, 1890, and March, 1894.
[690] The percentages for the Atchison are corrected according to the
report of Mr. Little. Owing to the lack of available detail it has
been necessary to increase operating expenses by the total amount of
the errors which he discovered, and this figure is, therefore, unduly
inflated.
[691] In 1893, after the Northern Pacific failure, the consolidated
5 per cent bondholders formed a committee; Mr. Brayton Ives invited
bondholders to send in their names and addresses to him (1894); and
later in 1894 the falling off in the railroad’s earnings induced the
formation of the Livingston and Van Nostrand committees, and the
announcement of the consolidated committee that it would accept the
deposit of second and third mortgage bonds. Finally, within four months
after the Atchison failure of 1893, four important reorganization
committees were asking for deposits in the United States and one was
soliciting deposits in London.
[692] The officers of bankrupt roads have no need of committees to
make their wishes known, but only so far as they are bondholders,
or in so far as they can influence bondholders by argument do their
opinions carry weight. President Ives of the Northern Pacific in
1893 was able to use his position to fight his opponents through the
courts, and secured besides appointment on a stockholders’ protective
committee, but exercised no great influence on the reorganization;
President Jewett, of the Erie, gained the confidence of the visiting
committee of English bondholders in 1875, and had some voice accorded
him; but generally speaking officers have to rest content if they
can successfully defend themselves against charges of inefficiency
and mismanagement. They are, in fact, both the choice and the
representatives of the stockholders, and the stockholders having no
authority in the event of bankruptcy can delegate none. Officers of
the courts which are in control of bankrupt railroads enjoy sometimes
a different position from officers of the corporations themselves, in
that they do not represent or depend on stockholders, and may not be
connected with the circumstances which have caused the ruin of the
road. Thus the receivers of the Union Pacific in the nineties were
called to testify before Congressional committees, and those of the
Erie chose a committee which prepared the first reorganization plan
suggested, but in both cases the functions of the court officers were
purely advisory, and so they must always be.
[693] In 1895 the final Atchison reorganization plan announced the
following arrangement: “A contract has been made with a syndicate to
furnish an amount of money equal to the assessments of non-assenting
or defaulting stockholders, and such syndicate, by such payment, shall
take the place of the non-assenting or defaulting stockholders, and
shall be entitled to receive the new common and preferred stock, which
non-assenting or defaulting stockholders would have been entitled to
receive if they had deposited their stock and paid their assessment in
full. Syndicates may also be formed to furnish the money needed, in
case of foreclosure, to pay the non-assenting bondholders their _pro
rata_ share of the proceeds of sale, and to advance any cash which may
be required during the reorganization and for other purposes.” Chron.
60:658–62, 1895. The reorganization plan of the Baltimore & Ohio in
1898 contained the following: “A syndicate has been formed ... which
agrees: 1st, To purchase $6,975,000 of the new preferred stock, and
$30,250,000 of the new common stock, and to offer the same for sale to
depositing holders of old 1st and 2d preferred and common stock of the
Baltimore & Ohio Railroad Company.... 2d, To purchase $9,000,000 3½
per cent prior lien bonds; $12,450,000 1st mortgage 4 per cent bonds;
$16,450,000 preferred stock. 3d, To protect the new company in the
ownership and possession of the properties covered by $49,974,098 ...
of the existing mortgage bonds of the old company of different issues
by agreeing to purchase from the new company the new securities not
taken, but to which the holders of such bonds would have been entitled
if depositing under the plan, at a price equal to the principal of the
respective old securities, and also to make advances and perform other
obligations essential for the purposes of the plan.” Poor’s Manual,
1898, p. 1381. Similar provisions appear in the plans of the Erie, the
Northern Pacific, the Reading, the Southern, and the Union Pacific.
[694] In 1894.
[695] H. V. Poor (Manual, 1900) compiles the following statement for 57
selected companies reorganized between 1886 and 1898:
_Securities provided for other corporate purposes of new companies_
Capital stock: Bonded Indebt.
Preferred, $89,971,268 Int.-bearing, $538,277,638
Common, 96,555,753 Income, 48,902,701
[696] Where stock- or bondholders are compelled to subscribe to an
issue of new securities the operation becomes an assessment and not a
sale.
[697] Among the reorganizations of the eighties, for instance, the
Denver & Rio Grande levied $8 per share in 1885 upon its $38,000,000
common stock; the Pittsburgh & Western assessed its common stock 4 per
cent in 1887; the New York, Chicago & St. Louis assessed its common
$10, and its preferred an equal sum; and the Central Iowa levied 2½ per
cent on its debt certificates, 5 per cent on its 1st preferred stock,
10 per cent on its 2d preferred, and 15 per cent on its common. See
Chron. 40:480; Ibid. 44:212, 370, 653.
[698] A syndicate guaranteed the assessment in each case between 1893
and 1898. The Reading assessment is calculated on a par of $100.
[699] The assessments before 1893 were as follows: The Erie levied
2½ per cent on its common and preferred in 1859, and a minimum of $4
on its common and $2 on its preferred in 1877, with no allowance of
new securities in either case. The East Tennessee assessed its common
stock 6 per cent and its income mortgage 5 per cent in 1886, and gave
to the one a corresponding amount of 2d preferred, and to the other
of 1st preferred stock. The Reading assessments in 1886 ranged from
2½ per cent on the deferred incomes to 15 per cent on certain junior
securities, with an assessment of $10 on both classes of stock.
Preferred stock was given for all assessments up to the full amount of
the sums taken.
[700] The quotations six months after reorganization are for the
combined securities given in exchange for the old preferred stock. In
the case of the Baltimore & Ohio _e. g._, this was 150 per cent in new
common; for the Northern Pacific it was 50 per cent new common and 50
per cent new preferred. Only $5,000,000 of Baltimore & Ohio preferred
stock were outstanding before the reorganization of 1898, and no record
of quotations can be found. Quotations are similarly unobtainable for
the Reading in 1886.
[701] The very large increase in the Baltimore & Ohio quotations was
doubtless due to the lateness of the reorganization.
[702] Chron. Investors’ Supplement, January, 1894.
[703] Ibid. 62:641, 1896.
[704] Chron. 45:792, 1887 (reorganization plan). See also Chron.
49:269, 1889.
[705] Pages 84–5, _supra_.
[706] Chron. 50:141, 1890.
[707] Ibid. 58:762, 1894.
[708] Chron. 62:829, 1896. Poor states in his Manual for 1900 that of
$96,094,960 of assessments levied on securities of fifty-seven selected
companies, $86,972,703 were on stock and $9,122,257 on bonds.
[709] The figure of $9,043,944 is the true figure for the Reading fixed
charges after reorganization, eliminating duplications. In computing
the percentage of charges to earnings in 1898, however, the unrefined
figure of $12,210,291 is used in connection with a similarly unrefined
figure of earnings.
[710] The reorganizations omitted are those of the Union Pacific in
1880, which did not alter fixed charges, and of the Erie in 1859
and the Northern Pacific in 1875, for which precise figures are not
available. In this last charges were almost entirely removed; its
exclusion, therefore, tends to lessen the percentage of reduction shown
for the reorganizations before 1893.
[711] The six reorganizations before 1893 include that of the Atchison
in 1892, which was not caused by inability to earn charges, and
consequently made no attempt to lower their figure. Excluding this
reorganization, the reductions in charges before 1893 overbalanced
the increases. H. V. Poor calculates the absolute reduction in fixed
charges for sixty-eight railroads reorganized between 1885 and 1897 at
$24,007,490. (Manual, 1900, p. cvi.)
[712] The decrease in charges per mile for the Reading in 1880 was due,
not to any reduction in charges, but to an increase in mileage through
the lease of the Central Railroad of New Jersey. In this case the
increase in absolute charges better represents the real effect of the
reorganization.
[713] It is perhaps unnecessary to warn the reader that these tables
can be taken as generally indicative only. The percentage of charges
to earnings varies not only with charges but with earnings; and an
increase or decrease in the latter may conceal a decidedly contrary
movement in the former. Since the reorganizations were accomplished at
different dates the error is not in all cases in the same direction,
and in particular the percentage of charges to earnings for one road
cannot be compared with the percentage for another. The figures
of charges per mile of line are somewhat more reliable, but are
nevertheless to be used with care. Different railroads report their
mileage differently, and it has not been possible in all cases to use
the homogeneous figure of mileage operated. Further, the significance
of high charges per mile varies with the character of the mileage.
A reorganization which lops off many unprofitable branch lines may
conceivably cause thereby an increase in the charges per mile of road
remaining, and yet place the system in a much stronger position than
before. This difficulty disappears if the figure of charges per mile be
used in connection with the percentage of charges to earnings, and in
general the three columns given correct each other.
[714] These figures do not include the comparatively small amount of
bonds for which no interest rate was specified.
[715] Income bonds sometimes, though rarely, possess the right to vote.
[716] E. S. Meade, Annals Amer. Acad. Pol. and Soc. Sci. March, 1901.
[717] The figure for the Reading in 1880 is affected by the lease
of the Central of New Jersey, which took place simultaneously with
the reorganization. Excluding the increase in rentals, the remaining
increase in fixed charges amounted to only 9.5 per cent. The East
Tennessee reported no rentals in either 1885 or in 1887. The data for
the Southern Railway are not in such shape that rentals and interest
can be compared. Its reorganization reduced rentals, however, very
greatly.
[718] The 32 per cent paid has been included under rentals.
[719] Government Debt.
[720] In considering the capitalization of the Erie before and after
the reorganization of 1895 the securities of the New York, Pennsylvania
& Ohio have been excluded.
[721] The difficulties which prevent wider extension of these tables
consist partly in the absence of quotations for certain classes of
bonds, and partly in the lack of sufficiently detailed and precise
information in some of the early reorganization plans. Thus there are
no quotations recorded in 1874–5 for the 2d consols and convertible
bonds of the Erie Railroad which were disturbed by the subsequent
reorganization; and no detailed figures of the exchange of new
bonds for old appear in the reports of the reorganization plans of
the Reading in 1881–3, and of the Northern Pacific in 1875. The
reorganization of the Union Pacific and of the Chicago, Rock Island &
Pacific in 1880 did not disturb the bonds outstanding.
[722] The twenty-six railroads are as follows: Canad. Pac.; Canad.
So.; C. & O.; C., B. & Q.; C. & E. I.; C., M. & St. P.; C. & N. W.;
C., R. I. & P.; C., C., C. & St. L.; D., L. & W.; Ill. C.; L. S. &
M. S.; L. & N.; Manh. El.; Mich. C.; M., K. & T.; Mo. Pac.; Mob. & O.;
N. Y. C. & H. R.; N. Y., O. & W.; So. Pac.; Wabash; Tex. & P.; C. of
N. J.; L. E. & W.; St. P., M. & M.
[723] The securities in the table are taken from the following
companies: St. P., M. & M.; Wabash; N. Y. C.; C., B. & Q.; C., M. & St.
P.; L. & N.; D., L. & W.; Penna.; W. U. Tel.; B., R. & P.; Can. So.;
Long I.; P. C. C. & St. L.; Tex. & P.; C. & N. W.; I. C.; C. & E. I.
[724] See Annual Report for 1906.
[725] Chron. 54:369, 1892.
[726] Investors’ Supplement, April, 1897; Chron. 62:41.
[727] Chron. Investors’ Supplement, April, 1897.
[728] Chron. 79:2087, 1904.
[729] 161 U. S. 647.
[730] 138 U. S. 84.
[731] New York, 1879.
[732] 49th Congress, 1st Session, Senate Report, No. 42.
[733] 42d Congress, 3d Session, House Reports, No. 77.
[734] 50th Congress, 1st Session, Senate Executive Document No. 51.
[735] 54th Congress, 1st Session, Senate Document No. 314.
[736] 58th Congress, 3d Session, hearings before the Committee on
Interstate Commerce, United States Senate, in Special Session, 1905.
[737] Memoirs of Henry Villard, 1835–1900. Boston, 1904.
[738] Ellis Paxon Oberholtzer, Life of Jay Cooke. Philadelphia, 1907.
[739] H. G. Pearson, An American Railroad Builder. John Murray Forbes.
Boston and New York, 1911.
[740] Bouck White, The Book of Daniel Drew. New York, 1910.
[741] C. M. Depew, A Retrospect of Twenty-five Years with the New York
Central Railroad and its Allied Lines. New York, 1892.
[742] Hazard Stevens, The Life of Isaac Ingalls Stevens by his Son.
Boston, 1900.
[743] Annals of the American Academy for Political and Social Science,
March, 1901.
[744] Forum, September, 1890, and March, 1894.
[745] Die Bank, July, 1911.
[746] Quarterly Journal of Economics, November, 1911.
[747] H. H. Swain, Economic Aspects of Railroad Receiverships, Economic
Studies of the American Economic Association, April, 1898.
[748] John P. Davis, History of the Union Pacific Railroad. Chicago,
1894.
[749] Alfred von der Leyen, Die Finanz-und Verkehrspolitik der
Nordamerikanischen Eisenbahnen, 2d ed., Berlin, 1895.
[750] I. H. Bromley, Pacific Railroad Legislation. Boston, 1886.
[751] J. F. Dillon, Pacific Railroad Laws. New York, 1890.
[752] J. B. Crawford, The Crédit Mobilier of America. Boston, 1880.
[753] Rowland Hazard, The Crédit Mobilier of America. Providence, 1881.
[754] Henry Kirke White, History of the Union Pacific Railroad.
Economic Studies of the University of Chicago, 1895.
[755] Hugo R. Meyer, The Settlements with the Pacific Railways.
Quarterly Journal of Economics, July, 1899.
[756] T. W. Mitchell, The Growth of the Union Pacific and its Financial
Operations. Quarterly Journal of Economics, August, 1907.
[757] W. F. Bailey, The Story of the First Trans-Continental Railroad,
its Projectors, Construction, and History. Pittsburg, 1906.
[758] John R. Robinson, The Octopus. A History of the Construction,
Conspiracies, Extortions, Robberies, and Villainous Acts of the Central
Pacific, the Union Pacific, and Other Subsidized Railroads. San
Francisco, 1894.
[759] E. H. Mott, Between the Ocean and the Lakes; the Story of Erie.
New York, 1899.
[760] Charles Francis and Henry Adams, Chapters of Erie and Other
Essays. Boston, 1871.
[761] George Crouch, Another Chapter of Erie. New York, 1869.
[762] Milton Reizenstein, Economic History of the Baltimore & Ohio,
1827–53. Johns Hopkins University Studies, July-August, 1897.
[763] W. P. Smith, The Book of the Great Railway Celebrations of 1857.
New York, 1858.
[764] Laws, Ordinances, and Documents Relating to the Baltimore & Ohio
Railroad Company. Baltimore, 1840.
[765] E. V. Smalley, History of the Northern Pacific Railroads. New
York, 1883.
[766] B. H. Meyer, A History of the Northern Securities Case. Bulletin
of the University of Wisconsin, July, 1906.
[767] Alfred von der Leyen, _v. supra_.
[768] W. W. Chapman, The Northern Pacific Railroad. Washington, 1880.
[769] Robert von Schlagintweit, Die Santa Fe und Sudpacificbahn in
Nordamerika. Köln, 1884.
[770] W. B. Wilson, History of the Pennsylvania Railroad Company.
Philadelphia, 1899.
[771] T. K. Worthington, Historical Sketch of the Finances of
Pennsylvania. Publications of the American Economic Association, May,
1887.
[772] A. L. Bishop, The State Works of Pennsylvania. Publications of
Yale University, New Haven, 1907.
[773] W. K. Ackerman, Historical Sketch of the Illinois Central
Railroad. Chicago, 1890.
[774] J. H. Hollander, The Cincinnati Southern Railway: A Study in
Municipal Activity. Johns Hopkins University Studies, January-February,
1894.
[775] E. A. Ferguson (Compiler), Founding of the Cincinnati Southern
Railway; with an Autobiographical Sketch. Cincinnati, 1905.
[776] Charles S. Potts, Railroad Transportation in Texas. Bulletin of
the University of Texas, Humanistic Series, March 1, 1909.
[777] P. Briscoe, The First Texas Railroad. Texas Historical
Association Quarterly, Austin, 1904.
[778] Chicago, 1905.
[779] E. B. Hinsdale, History of the Long Island Railroad. New York,
1898.
[780] Judson W. Bishop, History of the St. Paul and Sioux City
Railroad, 1864–1881. Minnesota Historical Society, Collections, vol. x,
pp. 399–415. St. Paul, 1905.
[781] George Bliss, Historical Memoir of the Western Railroad.
Springfield, 1863.
[782] Cary, Organization and History of the Chicago, Milwaukee & St.
Paul Railroad Company. Milwaukee, 1893.
[783] U. B. Phillips, A History of Transportation in the Eastern Cotton
Belt to 1860. New York, 1908.
[784] George Francis Train, My Life in Many States and in Foreign
Lands. New York, 1902.
[785] G. H. Smyth, The Life of Henry Bradley Plant, Founder and
President of the Plant System of Railroads and Steamships and also of
the Southern Express Company. New York and London, 1898.
[786] S. F. Van Oss, American Railroads as Investments. New York, 1893.
[787] Carl Snyder, American Railways as Investments. New York, 1907.
[788] Charles F. Carter, When Railroads were New. New York, 1909.
[789] F. H. Spearman, The Strategy of Great Railroads. New York, 1904.
[790] Philadelphia, 1888.
[791] New York, 1887.
[792] New York and London, 1900.
[793] Leipzig, 1883.
[794] Berlin, 1909.
[795] Chicago, 1910
[796] San Francisco, 1890.
[797] San Francisco, 1891.
[798] Springfield, 1874.
[799] Baltimore, 1899.
[800] Madison, 1899.
[801] Madison, 1908 and 1910.
[802] Chicago, 1896.
INDEX
Abbott, E. H., 290, 291.
Accounts, juggling with, Baltimore & Ohio, 11, 15, 21–23;
Erie, 37;
Reading, 127;
Southern, 169;
Atchison, 208–10.
Adams, Charles Francis, Jr., 7, 232–7.
Adams Committee, 293–5, 296–7, 302.
Alabama Central, 149, 151.
Alabama Great Southern, 188.
Aldrich Committee, 221–2.
Alexander, E. P., 154, 164, 169, note.
Ames, Oliver, 250.
Anderson, E. E., 40, 244, 248.
Anthracite coal, _see_ Coal.
Armour, P. D., 31.
Assessments, Baltimore & Ohio, 6;
Erie, 35, 44, 47, 68, 70;
Reading, 107, 111, 114, 139;
Southern, 155–6, 181–2, 185–6;
Atchison, 212–14;
Union Pacific, 252;
Northern Pacific, 269, 303, 305–6;
General, 350–4.
Atchison, Topeka & Santa Fe, 192–219, 235, 259, 260, 277, 342.
Atlantic & Great Western, _see_ New York, Pennsylvania & Ohio.
Atlantic & Pacific, 194, 195, 208, 216.
_See also_ St. Louis & San Francisco.
Atlantic Coast Line, 148, 158, 161.
Bacon, E. R., 18.
Baer, George F., 111, 142.
Baltimore & Ohio, 1–33, 38, 145, 169, 259, 260, 342.
Baltimore Committee, 24.
Baring Brothers & Co., 11, 215.
Bartol Committee, 103, 104–5.
Belen, 218.
Belmont, August, & Co., oppose Erie reorganization plan, 63–6;
lead opposition to Adams Committee, 290;
members of Northern Pacific reorganization committee, 296, note;
of Northern Pacific voting trust, 307;
underwrite Northern Pacific mortgage, 274.
Bigelow, F. G., 300, 301, 308.
Blanchard, George R., 2, 3.
Boissevain, A. H., 242–4, 245–7.
Bond, Frank S., 89, 90, 91;
plan of reorganization by, 92–5; 95–6.
Boston & Maine, 122, 124, 126, 127–8.
Boston, Hartford & Erie, 36.
Branches, Baltimore & Ohio, 9–10;
Erie, 51–3, 57, 59–60, 74;
Southern, 168;
Atchison, 196–8, 217–18;
Union Pacific, 230–31, 232–3, 236, 248–9, 250–51, 253–4;
Northern Pacific, 275, 276, 277–8, 286–7, 291, 292, 304, 306–7;
Rock Island, 315–16, 319–20, 328–31;
General, 369–71.
Brice, Calvin S., 150, 160, 244.
Brown, Shipley & Co., 9, 11.
Buffalo, New York & Erie, 38.
Burleigh, Andrew F., 300, 301.
Cable, R. R., 314.
Caldwell, Stephen A., 81, 82, 97.
Capitalization, Baltimore & Ohio, 1, 9, 11;
Erie, 34, 35, 36, 39, 44, 48, 71–2;
Reading, 75–6, 82, 101, 115, 138, 141;
Southern, 151, 183–4, 186;
Atchison, 198, 200, 211, 219;
Union Pacific, 221–4, 225, 227, 229, 232, 236, 251;
Northern Pacific, 264, 266, 268, 271, 275, 276, 278, 279, 302, 304;
Rock Island, 311–12, 315, 318, note, 322, 331, 332–3;
General, 339, 363–9, 372–4, 374–9.
Cash requirements and floating debt, Baltimore & Ohio, 11–15, 26–7;
Erie, 34–5, 40, 54, 55–6, 61, 68;
Reading, 79, 81–2, 101, 124–6, 127, 133, 139;
Southern, 152, 156, 160, note, 168, 173, 182, 186;
Atchison, 197, 199–200, 213;
Northern Pacific, 266–7, 267–9, 272, 274, 276, 287–9, 295, 304–6;
General, 348–56.
Cass, George W., 266, 267.
Central of New Jersey, 9, 10;
leased by Reading, 97–9, 117, 120, 122;
shares purchased on margin, 99–100.
Central, New England & Western, 123.
Central Railroad & Banking Company of Georgia, 162–6, 169, 175–8, 188.
Charlotte, Columbia & Augusta, 147, 159.
Chicago & Alton, Harriman buys stock in, 259, 331;
Rock Island buys stock in, 330, 331;
reorganization of, 337.
Chicago & Atlantic, 52, 54, 57, 62.
Chicago & Northern Pacific, 283–4, 286, 287;
loss on operation of, 289, 291–2;
Northern Pacific abandons lease of, 290, 302, 308.
Chicago, Burlington & Quincy, 277, 310, 343.
Chicago, Indianapolis & Louisville, 189.
Chicago, Milwaukee & St. Paul, 259, 343.
Chicago Terminal Transfer Company, 33, 283;
Northern Pacific sells stock in, 308.
Childs, Attorney-General, 298.
Choctaw, Oklahoma & Gulf, 319–20, 328.
Cincinnati, Hamilton & Dayton, 52–3, 57, 74.
Cincinnati, New Orleans & Texas Pacific, 189.
Clark, S. H., 240, 253.
Clyde, W. P., 174–8.
Coal, development of Erie’s traffic in, 38, 50–1, 73;
interest of Reading in, 76–81, 97, 99, 118–23, 125–6, 141, 143,
145; 311.
Coal & Iron Company, Reading, 77, 80–83, 88, 92, 97, 101, 118–20,
123, 127, 139, 141–4.
Colby, Charles L., 290.
Colorado Midland, 203, 205, 212.
Columbia & Greenville, 159, 160, note, 168.
Committee of Investigation, Baltimore & Ohio, 15–16, 21;
Erie, 37, 40, 55–6;
Reading, 84, 119;
Southern, 152, 170, 177;
Atchison, 199–200;
Northern Pacific, 285–6.
Committee of Reorganization, _see_ Reorganization Committee.
Competition, a cause of railroad failure, 340–1.
Consolidation, through reorganization, 370–1.
Contracts, trackage and traffic, Baltimore & Ohio, 9;
Erie, 52;
Reading, 121;
Southern, 149;
Atchison, 193–5, 217;
Northern Pacific, 275, 283–4, 308.
Cooke, Jay, interested in Northern Pacific, 264;
failure of, 79, 265.
Cooley, Thomas M., 7.
Coppell, George, 128, 175.
Corbin, Austin, 117, 118, 120.
Coudert, F. R., 241.
Cowen, J. K., 20, 29–30.
Crédit Mobilier, 223–4.
Cullom Committee, Albert Fink testifies before, 7.
Davis, J. C. Bancroft, 35.
Davis, John P., 222–3, 224.
Deferred income bonds, 81, 84–6, 87–8, 90, 96, 115.
Delaware, Lackawanna & Western, 120–1.
Denver Pacific, 227, 228–30.
Depew, Chauncey M., 250.
Deutsche Bank, supports Henry Villard, 273; 294;
underwrites Northern Pacific reorganization plan, 296, 304; 307.
Differentials, between eastern seaboard cities, 5, 7;
between stronger and weaker roads, 17.
Dillon, Sidney, 233, 234, 237.
Dressed beef, rates cut on, 17.
Doane, John W., 241.
Drew, Daniel, 34, 36.
Drexel, Anthony J., 125, 126, 134.
Drexel, Morgan & Co., take part in Erie reorganization, 62, 65, 66–9;
in Southern reorganization, 167–8, 175, 178–86;
underwrite Northern Pacific mortgage, 274.
Dunan, S. H., 37.
Durant, T. C., 223.
Earle, George H., Jr., 135.
East Tennessee, Virginia & Georgia, _see_ Southern Railway.
Employees, reorganization of the service, 15, 234;
wages reduced or delayed, 37, 39, 41, 79, 81, 100, 199, 234;
wages high, 222.
Equipment, Baltimore & Ohio, 23, 28, 31;
Erie, 73;
Reading, 144;
Southern, 168, 189, 190;
Atchison, 218;
Union Pacific, 261;
Northern Pacific, 309.
Equitable Life Assurance Company, 288.
Erie, 2, 7, 17–18, 34–74, 342.
Erlanger Roads, 166, 167, 185.
Excelsior Enterprise Company, _see_ National Company.
Express companies, 12, 14.
Fairchild, C. S., 170.
Fink, Albert, 6, 7, 10.
Fink, Henry, 154.
Fisk, Jim, 36.
Fitzgerald, General Louis, takes part in Baltimore & Ohio
reorganization, 24;
in Reading reorganization, 136, 138;
in Union Pacific reorganization, 244–5, 250, 251–4;
in Northern Pacific reorganization, 293;
examines Richmond Terminal properties, 170.
Fixed charges, Baltimore & Ohio, 8, 10, 16, 20, 22, 28, 342, 357–9;
Erie, 35, 36, 38, 39, 48, 58, 66, 69, 72, 73–4, 342, 357–9;
Reading, 75, 82, 94, 96, 101, 115, 116, 118, 139–40, 144–5, 342,
357–9;
Atchison, 197–9, 203, 213, 216, 218, 342, 357–9;
Union Pacific, 224–5, 227, 229, 235–6, 251, 253–4, 261, 342, 357–9;
Northern Pacific, 266, 271, 275, 284, 293, 304, 310, 342, 357–9;
Rock Island, 312, 322, 357–9;
General, 357–61, 363–5, 369–72.
Fleming, Robert, 45–6, 155, 216.
Floating debt, _see_ Cash requirements and floating debt.
Foreclosure, Baltimore & Ohio, 28–9;
Erie, 34, 35, 49–50, 73;
Reading, 82, 141;
Southern, 157, 187, 188;
Atchison, 216;
Union Pacific, 254–7;
Northern Pacific, 270, 308.
Foreign investors, Erie, 36, 37, 40–50, 55–6, 63;
Reading, 82, 83, 84, 86–9, 91, 96, 119, 126;
Southern, 155;
Atchison, 206, 207–8, 210, 214, 215;
Union Pacific 244;
Northern Pacific, 264, 273.
Garrett, John, 4, 9.
Garrett, John B., 106, 114.
Garrett, Robert, 9, 16.
Gauge, on Erie, 34, 37, 38, 45, 51.
Georgia Central Company, 164, 165, 177–8.
Georgia Pacific, 149, 166.
Gorman, Senator A. H., 13.
Gould, Jay, prominent in Erie, 36; 194;
causes combination of Union Pacific and Kansas Pacific, 226, 228–30;
unloads branch roads on Union Pacific, 230–31; 233, 237.
Gowen, F. B., 76, 81, 84, 86, 87–91, 95–7, 99, 101, 112–15, 118–19,
120.
Grand Trunk, 2, 6, 7, 17, 18.
Grant & Ward, 54.
Great Northern, 258, 259, 277;
proposes to guarantee Northern Pacific bonds, 296–8, 309–10.
Gregory, Dudley S., 35.
Guarantee fund, 199, 203.
Gulf, Colorado & Santa Fe, 196, 202, 205, 218.
Hallgarten & Co., on Reading underwriting syndicate, 139;
on Southern reorganization committee, 171;
oppose Erie reorganization plan, 63–6.
Harriman, E. H., 32–3, 63–6, 188, 218, 258–60, 309–10, 331.
Harris, Joseph S., 77–8, 83, 97, 125–8, 129, 131.
Harris, Robert, 275.
Hartshorne Committee, 136.
Hepburn Committee, Albert Fink testifies before, 7.
Higginson, H. L., 206, 245.
Hill, J. J., buys interest in Baltimore & Ohio, 31–2;
struggle with Harriman, 258, 310;
proposed guarantee of Northern Pacific bonds, 296–8, 307.
Hollins, H. B., 165, 179, 188.
Hooper, John, 344.
Houston & Texas Central, 328–9, 355.
Houston East & West Texas, 329.
Hoxie, H. M., 223.
Huidekoper, F. W., 176, 177, note.
Huntington, Collis P., 194, 258.
Illinois Central, 19, 146, 259–60, 343.
Improvements, Baltimore & Ohio, 15, 23, 28, 30–31;
Erie, 42, 51, 60, 73;
Reading, 80–81, 118, 144;
Southern, 152, 168, 170, 189, 190;
Atchison, 202, note, 204, 212, 218–19;
Union Pacific, 234, 260–1;
Northern Pacific, 276, 278–9, 309;
Rock Island, 332, 333.
Income bonds, 203–5;
before and after reorganization, 365–6.
_See also_ Deferred income bonds.
Inman, John H., 164, 165.
Iselin, A. & Co., 139.
Ives, Brayton, 285, 287–8;
president of Northern Pacific, 290;
secures removal of receivers, 291–2, 298–9; 294, 295;
endorses Northern Pacific reorganization plan, 302.
Jenkins, Judge, 289, 292, 300, 301.
Jewett, H. J., 39, 40, 41, 49, 50–53, 55, 57.
Joint Executive Committee, 6.
Joint Executive Reorganization Committee, 210–16.
Junior Securities Protective Committee, 137.
Kansas Pacific, poor condition of, 225;
attempt at reorganization of, 226–7;
consolidated with Union Pacific, 228–30;
sale of, 256–7.
King, Edward, 206, 210–16.
King, John, 55, 57, 59, note, 61.
Kuhn, Loeb & Co., take part of securities issued under Baltimore &
Ohio reorganization plan, 26;
oppose Erie reorganization plan, 63–6;
represented on Richmond Terminal investigating committee, 170;
on Union Pacific reorganization committee, 250;
agree to take Northern Pacific collateral trust bonds, 288.
Lacombe, Judge, 61, 300, 301.
Lake Shore & Michigan Southern, 3, 18, 32, 145.
Land grants, _see_ State and federal aid.
Leases, Baltimore & Ohio, 2, 27;
Erie, 51–3, 56, 58, 59–60, 71–2, 74;
Reading, 97–9, 117, 120, 122, 123, 128, 130;
Southern, 147, 148, 149, 159, 161–2, 166, 188;
Atchison, 197;
Northern Pacific, 276, 283–4.
Leeds, W. B., 317–18.
Lehigh Valley, 74, 75;
leased to Reading, 120, 122, 123, 128–9, 130, 133.
Lehigh Valley Terminal Railroad, 128.
Lewis, Edwin A., 81–2, 97.
Lewis, Howard, 119.
Little, Stephen, report on Baltimore & Ohio, 21–3;
on Atchison, 208–10, 213;
set to work on the Reading, 128.
Live stock, 17.
Livingston, Johnston, 294, 307.
Lockwood, E. Dunbar, 106, 112, 117.
Logan, T. M., forms Georgia Central Company, 164;
seeks control of Richmond Terminal, 164–6.
Long Dock Company, 58.
Lord, N. P., 345.
Loree, S. F., 32.
Louisville & Nashville, 146, 149.
Maben, J. C, 175, note, 178.
McCalmont Brothers, 86–91, 96.
McCormick, Attorney-General, 143.
McCullough, J. G., 61.
McGill, Chancellor, 122.
McHenry, E. H., 300, 301, 308.
McHenry, James, 39–40, 49.
McLeod, A. A., leases Lehigh Valley, 120;
extends Reading into New England, 122–5;
statement by, 125–6;
resigns by request, 126–7; 132.
Macon & Brunswick, 149, 151.
Manville, Allen, 202.
Maryland, subscribes to Baltimore & Ohio stock, 1, 18.
Mayer, Charles F., 16, 18–20.
Memphis & Charleston, 148, 158, 168, 185, 188.
Mercantile Trust Company, 206, 288, 294.
Miller, O. G., 45–6.
Mills, Captain J. H., 300.
Mink, O. W., 240, 253.
Missouri Pacific, 196, 229.
Mobile & Birmingham, 146, 167, 168, 185, 188.
Mobile & Ohio, 189, 329.
Moore, James H., 318.
Moore, William H., interested in Rock Island, 317–18;
reorganization plan by, 321–6;
buys St. Louis & San Francisco, 327–8;
extends Rock Island to the Gulf, 328–30;
relations with Chicago & Alton, 330–1;
distrusted by investors, 332.
Morgan, J. P. & Co., organize syndicate to relieve Baltimore & Ohio,
11–13;
sell Cincinnati, Hamilton & Dayton to Erie, 74;
reorganize Reading, 108–11, 139, 140, 141;
members of Southern voting trust, 188;
of Union Pacific reorganization committee, 245;
take part in Northern Pacific reorganization, 296, 304, 307.
Morgan, J. S. & Co., 11, 69.
Morris, John, 40, 41.
Mullen, Attorney-General C. W., 327.
National Company, _see_ Philadelphia & Reading.
New capital, provision for, 379–82.
New York & Erie, 34, 35.
New York & New England, 123, 124, 356.
New York Central, 2–7, 17, 35, 38, 259, 343.
New York, Lake Erie & Western, _see_ Erie.
New York, Pennsylvania & Ohio, leased by Erie, 51–3, 59–60; 70–2.
Norfolk & Western, 149, 151, 355.
Northern Pacific, 18, 19, 232, 236, 258, 263–310, 315, 342.
Northern Pacific & Manitoba, 292, 306.
Northern Securities Company, 258, 259.
Notes, short time, Atchison, 199, 203;
Union Pacific, 237, 250, 251, 257;
Northern Pacific, 287–9.
Oakes, ——, 287, 289, 291, 292, 293, 299–300.
Oakman, W. G., 176.
Olcott, F. P., prominent in Reading reorganization, 135–6, 138, 140;
in Southern reorganization, 155, note, 171–4, 179.
Olney, Richard, 243.
Oregon & Transcontinental Company, 272–3, 275, 276.
Oregon Railway & Navigation Company, 236–7, 245, 249, 257, 272–3,
275–6.
Oregon Short Line, 232–3, 236, 249, 257, 276.
Patterson & Corwin, criticise Mr. Little’s report on the Baltimore &
Ohio, 23.
Payne, Henry C, receiver of Northern Pacific, 289, 292, 293, 299.
Payne, Oliver H., 171, note.
Pearsall _vs._ Great Northern Railway Company, 298.
Pennsylvania Railroad, 2–8, 10, 17, 31–3, 38, 87, 108–10, 143, 147,
148.
Perham, Josiah, 264, note.
Pennsylvania Coal Company, 74.
Pere Marquette, 74.
Philadelphia & Reading, 9, 10, 18, 32, 75–145.
Philadelphia, Reading & New England, 123, 128.
Pierce, W. S., 243, 252, 253.
Port Reading Railroad, 120, 122.
Poughkeepsie Bridge, 123.
Powell, T. W., 55, 56, 57–8, 84.
Preferred stock, use of, in reorganizations, 366–8.
Prevost, S. M., 31.
Railroad failure, causes of, 336–42.
Rate agreements, 4–7, 275.
Rates, 3–5, 6–8, 17, 235.
Rate wars, 3–5, 6–8, 17, 34–5, 38, 53, 196–7, 240.
Ream, Norman D., 31.
Receivers, Baltimore & Ohio, 20, 23, 28, 29;
Erie, 35, 36, 38–9, 50, 61;
Reading, 81–2, 97, 100–1, 117, 125–6, 127, 133–4;
Southern, 175, 176, 187;
Atchison, 205;
Union Pacific, 240–1, 248–9;
Northern Pacific, 289, 291–2, 295, 298–301.
Receivers’ certificates, 23, 68, 127, 293.
Reinhart, Joseph H., 202, 204, 205, 209–10.
Reid, D. G., 317–18.
Rentals, reduced through reorganization, 369–72.
Reorganization, definition of, 335;
causes of, 336–42;
cancellation of floating debt by, 348–56;
reduction of fixed charges by, 357–72;
distribution of losses under, 361–2, 368–9, 376–7;
general principles of, 384–6.
Reorganization committees, Baltimore & Ohio, 21, 24, 29;
Erie, 35, 40, 45–6, 55–6, 61–2, 63–5;
Reading, 82, 84, 86, 101, 103–5, 112, 114, 117, 126, 128, 133–5,
138;
Southern, 152, 155, 170, 171, 174, 175, 178–9;
Atchison, 199–200; 206–8, 210, 215, 216;
Union Pacific, 244–5, 249–50, 257;
Northern Pacific, 267, 293–4, 308;
General, 343–5.
Reorganization plans, Baltimore & Ohio, 24–8;
Erie, 34, 35, 41, 42, 43–9, 57–8, 61–5, 66–73;
Reading, 83–6, 91–4, 96–7, 101–3, 104–5, 106–8, 110–13, 114–16,
129, 133–4, 135–6, 138–40;
Southern, 152–3, 155–6, 171–4, 179–84, 185–6, 187;
Atchison, 200–2, 204, 206–8, 211–16;
Union Pacific, 226–7, 228–30, 241–4, 245–8, 250–4;
Northern Pacific, 265–6, 267–70, 296–8, 302–8;
Rock Island, 312–13, 321–4.
Reorganization trustees, for Erie, 35, 47;
for Reading, 104–5, 106, 107–10, 114.
Resolutions, Baltimore & Ohio, 15, 39;
complimentary to Mr. Gowen, 99;
by London bondholders’ committee, 207;
by Northern Pacific bondholders, 268;
by Northern Pacific preferred stockholders, 281, 285, note;
by Northern Pacific directors, 285.
Rice, I. L., 121, 124, 127, 132, 136, 164–6.
Richmond & Danville, _see_ Southern Railway.
Richmond & West Point Terminal Railway & Warehouse Company, 10, 18;
_see_ Southern Railway.
Riddle, Hugh, 314.
Ripley, E. P., 216.
Roberts, George B., 109, 110.
Rock Island, 196, 277, 311–33, 337, 343.
Rockefeller, J. D., 288.
Rouse, Henry C., 289, 292, 293, 295, 299.
Ryan, Thomas F., 178.
St. Joseph & Grand Island, 249, 259.
St. Louis & San Francisco, controlled by Atchison, 194, 202, 216;
by Rock Island, 327–8, 329, 330, 356.
St. Paul & Northern Pacific, 287, 288, 290, 296.
St. Paul, Minneapolis & Manitoba, _see_ Great Northern.
Saratoga agreement, 4.
Schiff, Jacob H., 170, 250.
Securityholders, divergence in interest between, 335.
Selma, Rome & Dalton, 149, 151.
Sickles, General Daniel E., 86.
Siemans, George, represents Deutsche Bank, 307.
Simmons, J. Edward, 128, 134.
Sonora Railroad, 194, 197, 217.
Southern Kansas Railway Company, 196.
Southern Pacific, 193–5, 217, 258.
Southern Railway, 146–91, 330, 342.
Southern Railway Security Company, 148.
Speer, Judge, 176.
Spencer, Samuel, 12–13;
president of Baltimore & Ohio, 15, 16;
of Southern Railway, 187;
killed, 191.
Speyer & Co., 26, 125, 333.
Speyer Bros., _see_ Speyer & Co.
Stanton, Henry, 289, note.
State and federal aid, Baltimore & Ohio, 1;
Erie, 34;
Richmond & Danville, 146;
East Tennessee, 147;
Atchison, 192, 194;
Union Pacific, 220–1, 225, 238–40, 241–4, 249, 254–7;
Northern Pacific, 263–6, 271.
Staten Island Rapid Transit Company, 10, 29.
Stockholders’ Protective Committee, 215, 296, 302.
Stockton, Attorney-General, 121–2.
Strong, W. E., prominent in Southern reorganization, 174–5, 178;
president of the Atchison, 194–5, 202.
Sully, Alfred, 133, 160, 164.
Surplus, on Baltimore & Ohio, 15, 22;
on railroads in 1893, 342–3.
Syndicates, Baltimore & Ohio, 11–15, 20, 26;
Erie, 68, 69;
Reading, 86, 108–10, 113–15, 120, 134, 139;
Southern, 150;
Union Pacific, 226, 237, 252;
Northern Pacific, 264–5, 271, 274, 276, 288, 296, 304;
General, 345–8.
Syndicates, compensation to, Erie, 69;
Reading, 109, 111, 112;
General, 347–8.
Tappan, F. D., 155, note, 171, note.
Terminals, of Baltimore & Ohio, 3–4, 9–10, 19, 33;
of Erie, 58;
of East Tennessee, 152;
of Atchison, 217;
of Northern Pacific, 283–4, 302, 308;
of Rock Island, 300.
Texas & Pacific, 194, 330, 356.
Texas Railroad Commission, 329.
Thomas, General Samuel, 160, 174, 175.
Thurman Act, 238–9, 242.
Trunk lines, see Rate wars.
Trunk-line arbitrators, letter of Mr. King to, 6.
Tyler, Captain, report of, 37.
Union Pacific, 32–3, 220–62, 275–6, 277, 310, 342.
United States Government, relations with Union Pacific, 220, 221–2,
238–40, 241–4, 249, 252–3, 254–6;
with Northern Pacific, 263–4, 265–6.
United States Supreme Court, decisions by, 238, 239, 298, 301.
Valuation, of Reading coal properties, 77–8, 82–3.
Vanderbilt, Commodore, 36, 95–6, 100, 314–15.
Van Nostrand, 294.
Vermilye & Co., 63–6.
Villard, Henry, 237, 272–4, 275, 281–3, 286–7, 288, 290, 291–2.
Virginia, subscribes to stock of Baltimore & Ohio, 1;
aids Richmond & Danville, 146.
Virginia Midland, 150, 159, 160, note.
Voting trusts, Baltimore & Ohio, 18–19, 27, 32;
Erie, 67;
Reading, 111, 115, 119, 140;
Southern, 183, 188;
Atchison, 201, 212–13;
Northern Pacific, 303, 307, 310;
General, 382–4.
Walker, Major Aldace F., 209, 216, 217.
Watkin, Sir Edward, 40, 41, 43–5.
Watson, P. H., 38, 39.
Welsh, John Lowber, 108–10, 111, 128, 134.
Western Union Telegraph Company, 14, 22, 27.
Westlake, J., 55, 56, 57–8.
Whelen, Townsend, 101–3, 104, 104–5, 108, 112.
Wilbur, E. P., 125, 127, 128.
Winslow, Lanier & Co., 274.
Wisconsin Central, leased to Northern Pacific, 283–4, 286, 289,
290–92, 302, 308.
Transcriber’s Notes
Punctuation and spelling were made consistent when a predominant
preference was found in this book; otherwise they were not changed.
Simple typographical errors were corrected; occasional unbalanced
quotation marks retained.
Ambiguous hyphens at the ends of lines were retained; occurrences of
inconsistent hyphenation have not been changed.
Index not checked for proper alphabetization or correct page references.
Volume:page references sometimes were printed as 123:456 (no space
after the colon) and other times as 123: 456 (with a space after the
colon). In this eBook, all such references omit the space (123:456).
Duplicate headings were removed by Transcriber.
In this version of this eBook, some tables were rearranged to make them
narrower.
Page 11: "J. S. Morgan" was printed that way, and there was such a
company.
Page 205: The reference to Footnote 430 was missing. Transcriber
arbitrarily added it at a likely place.
Page 244: "the interest were cancelled" was printed that way.
Page 341: Numbered list has no item #6.
Page 379: The year-headings in the original book appeared above the
dollar values, which seems to be a typographical error. In this eBook,
they have been centered above the Month-dollar values columns.
End of Project Gutenberg's Railroad Reorganization, by Stuart Daggett