About the time those words were being written work on the new plant was being started and the foundations of a new city, now having a population of 56,000, were being laid. It is appropriate that the name chosen for this town should have been Gary, although Judge Gary had nothing to do with the selection of the name. All previous records for production and profits were shattered in 1906. The betterment in steel conditions that started in 1905 continued throughout the ensuing year, and, indeed, until the latter part of 1907, when the disastrous panic occurred. The Corporation’s report for 1906 showed that it had increased its capacity for pig iron production more than 63 per cent. and its steel capacity nearly 57 per cent. between the date of its organization and January 1, 1907, and this increase enabled it to take advantage of the business betterment and to profit thereby. In 1906 the Corporation’s blast furnaces poured out 11,267,377 tons of pig iron, while its steel plants produced more than 13,500,000 tons of ingots and 10,578,000 tons of finished material. The gross sales of the year amounted to $696,756,926, and the net profits to $156,624,273. These large earnings justified the resumption of dividends on the junior stock and 2 per cent. on the issue was paid. The balance after dividends was $62,742,860, but special appropriations for proposed expenditures on the Gary plant and for other purposes were made, calling for $50,000,000, this making the net carried to surplus account only $12,742,860. Another important event of the year in the Corporation’s history was the incorporation of the Universal Portland Cement Co., which was formed to take over the cement plants operated by the Illinois Steel Co., and to erect new plants for the manufacture of this profitable by-product. The production of cement had grown from 486,357 barrels in 1902 to 2,076,000 barrels in 1906. The Universal Company immediately started work on the erection of two new plants, one at Buffington, Indiana, within a few miles of the Gary plant, and the other at Universal, Pa., near Pittsburgh. The results of this enterprise have entirely justified the expectations of the Corporation’s management, and the manufacture of the by-product has increased until an output of 11,197,000 barrels was reached in 1913. But the most notable event of 1906 was the negotiation of a lease by the Corporation on the ore properties owned by the Great Northern and Northern Pacific Railway companies. This was commonly known as the Hill Lease.