The daily gazette., 1881-04-27
From the New York World.

TIE purchasers Of the twenty millions
4 dollars of bonds emitted q few
months ago by the Northern Pacific
Railway corporation will do well to read
carefully the mortgage on which those
bouds are based before they come to
the.conciusion that theyIhave q lien on
all the. fertile lands OF that corporation.
Whoever carefully reads that.mortgage
and how many purchasers Of railway
bonds ever take the trouble to look at q
nortgage?-will discover this clause
amid the numerous recitals:
"And WHEREAS, By tho plan or reor-
Sanization of the Northern Pacific
Railroad Company, the said party of
the first part hereto, 1t was and 10 provid-
I'D and established among other things,
as follows, viz: The capital stock OF the
company shall be as fixed In the act of in
corporation, and shall be divided into
preferred aud common. The preferred
stock shall have all the rights and privi-
leges OF the common stock, with the
right to vote, and the holders thereof
shall be entitled to dividends not ex-
deeding per cent per annum, as the net
earnings hereinafter defined, in each
calendar year, may suffice to pay, and
before any dividends shall be paid on
the common stock"
"The preferred stock shall be CONVEX
dble at the par value into any lands be-
longing 70 the company, or hereafter to
belong to IL, east OF the Missouri River
10 the State Of Minnesota and In the
Territory of Dakota, until default shall
| occur in some OF the provisions Of the
| new first mortgage bonds hereinafter
| provided fer, and such conversion shall
| be an axtinguishment of such stock
| che proceed Of all sales OF such lands
| until such default shall be used likewise
a extinguishment of such stock"
In the granting clause viii be found
he Important reservation:
CAN the estate, right, title. interest,
claim and demand whatsoever which the
said party Of the first part now has, or
nay at any time hereafter acquire or be-
come entitled to, of, In and to all the
lands aforesaid, and also all the indem-
uity lands, wherever the same may be
situated, that shall or may DO acquired
10 supply deficiencies in the Quantities
of said grant lands, In pursuance Of and
in accordance with the terms and pro-
visions OF said grant; subject, however,
as to the lands In the state of Minnesota
and Territory OF Dakota east of the
Missouri River, until any default shall
occur in some of the provisions of the
bonds hereby secured, to the right OF the
holders OF the preferred stock of the
| said railroad company to convert their
stock into said lands, and TO the applea-
ton of the proceeds thereof to the ex-
| tinRnishmeDt of such stock, and sub
| iect also to the provisions and conii-
| lions Of the said mortgages on the
| said Missouri and Pend d'Orsille diyi-
sioHs, as hereinbetore mentioned"
II the directors pay the interest on the
| bonds until the holders of the preferred
shares exchange SOL ,O0O, 600 thereof for
those valuable lands in Minnesota and
| Dakota, and SO prevent any default IN
the bonds, two things viii happen. The
| lien of the bondholders on those lands
viii be swept away and the preferred
shars will be extipguished. whereupor
Mr. Window, with his proprietary
allies, will try to own the road and tn,
remaining lands by virtue of the $40,
OOO, 600 of common shares, for which
the original "proprietaries" never paid
penny What do the farmers of th,
Northwest think of that?