The Portland daily press., 1884-11-22
RAILWAY MATTERS.
The Eastern Eease-OppOsitiOn Upon the
Part ef the Boston aud Maine DirCc-


The following communication in behalf Of
some OF the Directors Of the Boston aud Maine
who are opposed to the terms upon which it is
now proposed to lease the Eastern Railroad
gives voice to the opposition referred 10 yester-
day. The communication is as follows:
The decision of the Supreme Court upon the
lease Of the Eastern Railroad by the Boston and
Maine is matter Of great importance to both roads
and by the stockholders of the Boston and Maine
may be looked upon as fortunate decision for
them coming as it does just at this time, and giving
them opportunity to carefully review theic acts
and to sbrogate, if need be, at the coming special
stockholders meeting q lease much inferior in ad
vantages to that by them agreeded to in March,
1883. With the bright business prospects ON that
date, when the Boston and Maine was earning ga
per cent, equal under the restrictions of the i'm
proyement bond eause of the lease to 1012 per
cent and the Eastern Railroad returning something
above per cent, upon its bonds, the lease was
thought to be an advantageous one for the Boston
and Maine but looking at il from the present stand
point when business is falling off, through the
stoppage OF mills, whose freight etc., is most i'm
portant factor in railroads earnings, and, while
from varied causes the larger railroad corporations
are being forced to reduce their dividends from
per cent TO per cent, is it wise for TO give up
good per cent iHvestmen: for what may prove IAN
ENHANCEMENT of alliances not easy to escape from,
andsperhaps long to be regretted and all for what?
Only the hope of another per cent, to get which
the Boston and Maine must burden itself with the
enormous debts of The Eastern ana be obliged to is
sue its own bonds to an amount nearly approaching
its capital stock.
Again, the Boston g. Maine, with it's capital stock
of 81 100000 and $4,50J00J debt, now carries
with it the bea credit in the money market; bat
when, by adding the Eastern debt Of $l5,U00OOO,
and. two more millions OF improvement bonds, We
shall stand under the lease with 81 900 OUO capital
and $40, 100000 OF debt, IS it probable that
our present credit will be sustained or is it probable
that the finances, now so easily mauaged, and the
business of the present two hundred miles Of road
now we'll directed by able superintendent, will
not be beyond the brain capacity Of the then exist
ing governing powers, when scattered over 500
O1ifA aaraH Htact tiNra fol ha ali md lnlu
pondered over by every stoekholder rs to be pre-
pared to act understandingy, when asked, as he
wlli be az the cont special slockholders meeting,
to recognize the lease OF the Eastern Railroad in
shape always advantageous to the Eastern bond
holder but doubtiully so to the stocAholder Of the
Boston ~ Maine
Under the original lease, 10 per cent dividends
were hoped for by the stockholders, and per cent
promised by the circnar OF the directors but 1t is
now conceded by the present government that 1t
would not be wise to pay out over per cent divi-
dends even If more 10 earned. Under the proposed
lease concessions have been too hastily made, which
Will give TO the Eastern railroad 500 OOO per
year after per cent has been paid 10 the Boston
& Maine instead of half Of any amount mp to
$l40,U00, as agreed upon in the original lease.
Yet worse than this is the agreement that the pro-
posed lease of the Eastern shall commence one
year back on Oct. 1, 1885, instead of the present
date, and 80 impose upon the Boston q Maine the
immediate payment of several hundI Ied thousand
dollars for past improvements on the Eastern, for
which the Boston & Maine must issue nes bonds,
while nothing is said of an equal amount which
might have been saved under the working of the
consolidation, had the Eastern been delivered to
the care Of The Boston q Maine at the date agreed
upon, and why the proposed lease should not as in
case of the original commence at or about the date
Of the agreement, is not explained otherwise than
by the argument that if the supreme Court had al
lowed the legality of the original lease the Boston
q Maine, through its want of foresight in not
guarding against such unexpected delays of 20
months, would have been obliged to recognize the
lease as commencing April l, 1883
The Supreme Court decision does away with the
original lease altogether, and in making new one
the ROston and Maine should iuSisfe1
a contract dating from the present time, and upon
an inventory Of property under present valuation.
Again, an agreement outside the lease is that two
or three of the present Eastern Railroad directors
shall be elected as members of the Boston and
Maine board, and it is probable that such eouise
will meet the approval of stockholders, who have
for so many years watched with questionable inter-
est the movements of the Eastern Railroad. The
present pooling arrangement between the Boston
and Maine and the Eastern, which has existed for
ten years, seemingly gives to the former $4,000
per year; but the fact is that. by an agreement of
the Boston and Maine with the Maine Central
Railroad, which continues subjectitoone years no.
tce the latter getsunder contract TO carry their
passengers between Portland and Boston at S1.50)
the income TO enable them to pay dividend to the
Eastern, the majority stockholder in the Maine
Central and the Eastern in turn, pays it the
B. aud M. in monthly installInents, as a seeming
gain under the pooling arrangements.
In making The Original lease, this iron bound
clause of protection TO the Maine Central was
subject of long dispute, and was only allowed to
get INTO contract made between the b. q M and
the Eastern as offset to the agreement that the
Is. u M. should receive one-halt Of any amount up
to $4,000 to be earned after its per cent. Yer
by the proposed lease the Eastern is allowed to
tain the Maine Central protective clause while at
the same time it is to receive $lUO,UOO tor its
sinking fund, in which the Boston asd Maine
stoekaOider can have 10 interest whatever. Now
let this disadvautageous agreement with the Maine
Central, made under force in order to get upon
their tracks at Portland De abrogated, that the
Boston and Maine shall get full tariff rates for
through passengers and then stffen up the preseat
pooling arrangements with the Eastern, so that
Lelther party snail carry more freight than it gets
paid for, and in other ways protect the revenue,
and the Boston and Maine under efficient manage
ment, will, through its constantly increasing local
traffic, always take care Of its stockholders in
teresls, JOHN FELT OsGoOD.
One of the Dissenting Directors.
AZ Congress street, Boston. Nov. 20. 1884.