"What terms do you offer?" asked Stephen Watson, overwhelmed by the conviction that what Miller said was true. "Surrender unconditionally, restore to Kit his own property, and----" "But it will leave me penniless!" groaned Stephen Watson. "Just as I supposed. In Kit's behalf, I will promise that you shall not starve. You once kept a small grocery store, and understand the trade. We will set you up in that business wherever you choose, and will give you besides a small income, say three hundred dollars a year, so that you may be able to live modestly." "But Ralph, my poor boy, what will become of him?" "I will pay the expenses of his education," said Kit, "and when he leaves school, I will make him an allowance so that he can enter a store and qualify himself to earn his own living. He won't be able to live as he has lived, but he shall not suffer." "It is more than either of you deserve," said Henry Miller. "I was not in favor of treating you so generously, but Kit, whom you have defrauded, insisted upon it. You ought to thank him on your knees." Stephen Watson did not speak. He looked the picture of misery. "Do you agree to this?" asked Mr. Miller. "I must!" replied Watson, sullenly. It made a great sensation in Smyrna when Kit took his proper place as the true master of his dead father's estate. Stephen Watson left town suddenly, and Ralph followed him. No sorrow was felt for his reverse of fortune, for he had made no friends in the town. He and Ralph settled down in a small Western city, and started a grocery store. From time to time Kit receives abject letters, pleading for more money, and sometimes he sends it, but always against the advice of Henry Miller, who says rightly that Stephen Watson already fares better than he deserves. Ralph is turning out badly. His pride received a severe shock when his cousin was raised above him, and he has formed bad habits which in time will wreck him physically, unless he turns over a new leaf. It is hardly necessary to say that Kit decided not to learn the blacksmith's trade. His old employer, Aaron Bickford, has tried hard to get into his good graces and secure his trade, but Kit employs another man for whom he has a greater respect. Kit has made more than one visit to the worthy Mayor Grant from whom he received so much kindness when a young acrobat, and a marked partiality for Evelyn, the mayor's pretty daughter, may some day lead to a nearer connection between the families. Good, like bad fortune, seldom comes singly, and besides recovering his own property, Kit finds himself the favorite and presumed heir of Henry Miller, the wealthy Californian, who has taken up his home with our hero. Last summer they took a trip to California, and Kit was charmed with the wonderful Yosemite Valley and the Geysers. He has decided to become a lawyer, though he will be in a position to live without employment of any kind.