Illinois Staats-Zeitung -- April 23, 1874A Declaration from A. C. Hesing
"Since much has been said and written in the last few days concerning my private affairs, and especially in regard to my connection with the Germania fire insurance, I wish to explain my financial situation to the public and let it be the judge.
Refore the fire I was connected with three other business enterprises besides the Staats Zeitung, three of them and four beautiful homes became a prey of the flames. Only the lumber business and the plane mill connected with it, were spared. On that day I lost about $125,000.00. The news of the disaster brought me quickly back to Chicago. After an absence of eighteen months, I arrived in Chicago early in November, 1871, three weeks after the fire. A brief survey revealed that my credit was unimpaired. So I went to work and helped not only to erect the Staats Zeitung building, valued with the machinery at $265,000.00 but I also did my part for the reconstruction of the North Side by having several homes built. In March, last year when the Staats Zeitung's building was hardly finished, Mr. Gustorf, manager of the Garden City Manufacturing Company, paid me a visit in my quality of main share owner and told me that he could not pursue his work without an extension of his liabilities. The business owed at that time $100,000.00 to 2the banks, which I had indorsed; it owed further $125,000.00 to lumbermen and building debts, mortgages and business debts of $150,000.00. All together $375,000.00. It was considered best to call a meeting of the creditors and submit to them a statement of the assets and the liabilities. The report of Mr. Gustorf revealed that the Garden City Manufacturing Company had a surplus fortune of $175,000.00 beyond its debts, that the arrears could be easily collected and that it was only a matter of gaining time to be able to care for all the liabilities. At the meeting a committee of five was selected to examine the books. It was reported that they were in order, and the creditors were asked to grant time extension provided I was willing to furnish a guaranty. I asked for time to think it over. But as Mr. Gustorf assured me that the assets were on hand and that I did not risk anything I decided to indorse notes to the amount of $225,000.00.
A fifth of this amount, $45,000.00 became due in September, 1873, and was paid promptly. Then came the financial crash. I wanted to wind up the business but Mr. Gustorf assured me, again, that he would be able to pull through with only a little more help, and in order to save my shares, which amounted to $100,000.00 as well as my indorsements, I gave again security for $30,000.00. But all was in 3vain. Credit and confidence disappeared everywhere and the Garden City Manufacturing Company was forced to liquidate. My responsibility towards the company amounted to $210,000.00. My security for it was a second mortgage on the will property. The first one amounted to $50,00.00.
Few would have had the courage to keep on but I decided to call my friends and creditors together and see if I could not gain a time extension.
All five banks were most friendly and gave me the desired time extension. I pawned all my personal belongings in order to pay all by debts up to the last penny. The creditors at a later meeting made the proposition that I should take over the mill property for $125,000.00 and pay the first mortgage. I accepted the proposition and the mill became my property.
But I soon learned that I had been deceived, that the factory was in a bad shape. According to the report of October, 1873, $169,000.00 was supposed to be there and now it was discovered that nothing was, and that even the lumber provisions were quoted beyond their value. My loss was over $200,000.00.4
Then came the court decision enjoining the stockholders of the Germania Fire Insurance to pay their notes in full. I was unable to pay the $19,500.00. Mr. Vocke received, then, the order to sell my notes, insured through the shares of the Illinois Streets Zeitung.
Every one knows that money has no attraction for me. I have helped many of my fellow citizens.
If some gentlemen asked why no judgment was pronounced against me, I retort, what good would it have done? Had I been thrown into bankruptcy, what would my creditors and the Germania have received? Some envious people resent my coach and horses but I am not going to sell a present received from my friends. I wish to insist that all my creditors will be paid and should I die, unexpectedly, my son and heir will assume all my responsibilities.
IV, II A 2, II B 2 d 1, II D 2
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