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Show MUST DIVORCE THE S. P. AND C. P. LINES Attorney General McReynolds Says Union Pacific's Failure to Take Over Road From Ogden to San Francisco Will Compel the Government to Institute Another Suit ATTORNEYS SUBMIT PLAN TO DISPOSE OF STOCK Company Will Exchange $38,000,000 Worth of Baltimore and Ohio Stock Will Prevent Dumping Large Block on the Market Court Announces No Decision Before Adjourning St. Paul, Minn., .Trine 12. Union Pacific railmad attorneys ap-teared ap-teared before TTnited States Circuit Judges. Sanborn, Hook and Smith today and explained the additional plans for disposing of tin-road's tin-road's holdings of Southern Pacific stock. Attorney General McReynolds, Mc-Reynolds, on behalf of the government, expressed unalterable opposi-. opposi-. tion to those plans which he said were "no plans at all but were merely propositions of something they intended to try to do." The court adjourned without announcing any derision. Presiding Presid-ing Judge Sanborn indicated that no order might be expected until the attorney general had decided whether the government would object ob-ject to a proposed exchange of part of the holdings of Southern Pacific Pa-cific stock for Baltimore and Ohio stock held by the Pennsylvania railroad. St Paul. Minn.. Jane 12 Attor ncys for the Union Pacific presented at the opening of the dissolution hear 1 lng here today a new plan for the disposition of $38,000,000 worth of Southern Pacific stock to the Pennsylvania Penn-sylvania railroad in exchange for $21,-000,000 $21,-000,000 worth of Baltimore & Oblo stock. The new plan proposed was supple mental to the two plans reconvy submitted sub-mitted The amount of stock Involved in the exchange represents only 14 per cent of th" total Southern I'ar I fir stock. The present holdings of the Union Pacific In Southern Pacific com mon stock represent about J12r,unn. nno N. H Loomis. of counsel for the Union Pacific, said that the Union Pacific did not guarantee to carry out either of the two principal plan', proposed pro-posed even though th- court approved both of them. If If should be found that to follow either would Involve too gTeat a sacrifice to the Union Pacific stockholders, the disposition of the stocks" would bo left to th court "How long a time do you think the Union Pacific should bo given to dis pose of the slock?" inquired Judge Smith. "I think the court should be 'liberal with us In tho matter of time because of the present condition of the money market " replied Mr Loomis He thought the railroad should have one year In which to offer the stock and complete the disposition of It. Attorney General McReynolds. opposing op-posing the plans proposed by the Union Uni-on Pacific, said that the railroads had been unable to effect a deal s horebv the Union Pacific would acquire the Central Pacific, operating from Og den to San Francisco, In exchange for its Southern Pacific stock He declared de-clared that this failure would compel the government to Institute an expen Blve litigation to compel the Southern Pacific to relinquish its hold over the Centml Ppriflr May Not Object to Exchange. Mr. McReynolds thought the government gov-ernment would not object to the proposed pro-posed exchange but. he wanted to Investigate In-vestigate the holdings of the various roads before making any definite state He said ho probably could inform in-form the court within three or four davs. "The time has come for the court to order something done," Bald 'ho attorney general. "The Union Pacific does not even guarantee to carry out either of the two so-called plans now j before the court; it asks a year to: try to accomplish one plan, provided, T mark, i conditions will permit such It action without loss to stockholders The railroad counsel say that to I dispose of tho market at present market mar-ket conditions would be at a great I f-in-rilice It less i Incurred it will I ' t i),, re: ult of wrongful action as construed by the supreme court II which has ordered ibis conn to dispose dis-pose of th" stock within reasonable time. Approval of either proposition submitted probably would find the situation Just as it Is now at the end! of the year." Judge Sanborn asked the attorney, general what action he thought fro-court fro-court should take. Mr. McReynolds' said the court should either appoint I ' receiver to dispose of the stock or W s-hould itself devise some means of I disposing of it The primary plan proposed provided ! for tho sale of Vie stock by popular j subscription similar to city bonds while the alternate plan provided for ' placing the disfranchised Stock with . a trustee and tho issuance of certificates certifi-cates of interest against It Those-certificates Those-certificates would be exchangeable L only on the filinjr of an affidavit Urn' the holder did not own any Union I Pacific stock I The Pennsylvania Railroad company I savs I "The arrangement is that the com-t com-t mon stock of the Baltimore and Ohio 11 railroad held by the Ponnsylvaula I railroad would be cold at par and the i preferred stock at $St) per share and the Southern Pacific stock to bo wur- f'jiiu'd .'it par "The whole transaction will involve I in transfer to the Pennsylvania of SS2.r24 t-hares Southern Pacific com-i com-i 1'V.vj iiDC-V and will xmTHBem the de- livery by the Pennsylvania railroad J to the Union Pacific of the entire j holdings of the Pennsylvania railroad I system in the stock of the Baltimore, and Ohio railroad." |