The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-09-24
UNION pAcirf6 RAILROAD.


FIRST MORTGAGE BONDS.
As before stated the Union Pacific Railroad Com
pany are authorized by Congress to issue their First
Mortgage bonds In the same amounts as are issued
by the government to the company on the various
sections of the road as they comprehensive:
On the first SIT miles at SIG, 900 per mle ss,272OOO
On the Rocky Mountain region, $50 miles,
On 4ss additional miles at per mile. 1s,sSSSoS
Total for 100 miles. 500, 1926, 900
All these bonds for 81 900 each, and have cou-
pons attached. They have thirty years to run, and
Dear Interest at the rate OF six per cent per annum In
gold payable on the first days Of January and July,
al the company's offices In the city OF New York.
PRINCIPAL AS WELL AS INTEREST PAYABLE
IN GOLD.
WINE the company have never supposed that the
principal oil their bonds would DO paid otherwise
than In gold, yet, to puta question this subject
at rest at meeting of the directors held on the 18th
OF March, 1865, 1t was unanimously
Resolved, That the President and Treasurer are
authorized and directed to enter into covenant
with the trustees OF the first mortgage bonds OF this
company, to pay the principal of said bonds; ut ma
turity, in United States gold coin.
In accordance with this resolution the President
and Treasurer made the following
COVENANT:
KNOW ALL MEN BY THESE PRESENTS, That where
as the Union Pacific Railroad Company heretofore
executed to Edwin ID. Morgan and 0akes Ames, trus-
the first day Of November one thousand eight hun
bred and sixynve, mortgaging thereby the railroad
OF the said company to the said trustees TO secure the
payment Of the said company s first mortgage bonds
and the said indenture Of mortgage was duly re.
divers Of the said first mortgage bonds and intend
hereafter to issue divers others Of said first mortgage
SenSre Of nd Ir by e d the
tenor Of said bonds the principal sum
p psd aw thereon money 81 e Hns STATES, to s
consideration Of the premises and OF dollar to the
said 50 company IN hand paid the receipt whereof
and valuable considerations the said company there
unto moving the said company hereby covenant and
Cakes Ames as Trustees for the benefit OF all who
are or shall be holders of said bonds, and to and
with the successors of said trustees in the trust Gre
ated by the said indenture OF mortgage that the
principal OF all the said first mortgage bonds, being
1000 each, as well such as have been issued
hitherto as such shall be issued hereafter, shall
and will be paid by the said company whatsoever
the same respectively become payable according to
the tenor thereof, in the gold com OF the United
States Of par that 10 to say, $1,000 OF SUCH coin lor
In witness whereof the said company have caused
these presents to be sealed with their corporate seal
"' OLIVER AMEs, President
JOHN J. CISCO, Treasurer.
Sealed and delivered in the presence Oh BENJAMIN
F. HAM.
Are these bonds secureY This point seems to have
been carefully provided for by Congress. The mort
gage Is made to Hon. E. d. Morgan, United States
Senator from New York, aud Hon. Cakes Ames,
member of United states House Of Repres entatiyes
from Massachusetts, who alone can deliver the bonds
to the company and who are responsible for their
delivery In strict accordance with the terms Of the
law The President Of the United States appoints
five government directors who cannot be stockhold-
ers who take part in the direction OF all its affairs,
and one Of whom Is to be on every
committee Of the company. 1t Is the duty OF
these directors to that all the business Of
the company is properly managed and to report the
same to the Secretary Of the Interior, who reports,
through the President, to Congress. The President
of the United States also appoints three Commission
ers to inspect the work as it progresses, sections
OF twenty miles, to that II Is In all respects first
class road, and that 1t Is suitably provided with
depots stations, &C., and oil the rolling stock neces-
sary for its business The United States bonds
issued to the company only as each section Of twenty
| miles Is accepted by the United States Commission
| ers. and the trustees OF the first mortgage bond
| holders deliver the company's first mort
| gage bonds to the company only on the
| conditions, except that the company permitted
to Issue their bonds for hundred miles In advance
OF the completed line, to part OF the cost OF
grading, &c. To give every facility for the neeotla
ton OF the company's first mortgage bonds the gov
eminent makes its bonds issued to the company
second lien, and 1t VIII be noticed that the Union
Pacific Railroad is In fact, q government work,
and to O large extent with government money.
The company's bonds not only first mortgage
upon property that costs three times their
amount but upon property OF daily increas-
| ing value, and whose income Is already much more
| than their interest. First mortgage bonds whose
| principal is SO thoroughly secured and whose inte
rest is liberal and amply provided for, must be
classed among the very safest and best securities
A PERMANENT VALUE.
The recent movements I'm Congress I'm favor OF ic-
deeming the government bonds In currency or tax
ing them directly Indirectly so as to reduce the
rate Of interest and practically compel the holders
to fund them at four four and half per
cent, have induced many careful investors
to exchange their government securities as a
whole or In part, for Union Pacific First Mortgage
Bonds. There others VINO always prefer FIRST
mortgage upon such great, valuable and pro-
ductve real estate to the obligations OF any State or
nation, which subject to the vicssltudes OF po-
itical action
WHAT ARE THEY WORTH AS AN INVESTMENT
Answer.-Other conditions being the same, secu-
rifles valuable according TO their rate OF interest.
The recent average quotations for United States
ten-forty bonds, bearing only five per ceut
gold interest, redcemabe by the government
In six years, have been los to 100, and
the United States SKIES OF 81, gold six per cents
which may be redeemed In thirteen years. have been
ut from 113 to 115K. The best first mortgage six per
cent railroad currency bonds range at about par,
and the per cents run to q considerable pre-
MUM, while the Union Pacific first mortgage bonds
sure to pay six per cent in gold which, with the
premium at 40 where 1t has stood upon the average
for about three years., pay 2-5ths per cent
IL will be noticed that very important consider
alton in determining the value OF these bonds Is the
length OF time they have TO run.
1t is safe to assume that during the next thirty
years the rate Of interest United states viii de-
cline, IL has done In the old countries or Europe,
and have right 10 expect that such six per cent
securities as these will be held at IA high premium
as those Of this government which, in 1851, were
bought In at from twenty to twenty-three per cent
hov mar