The Portland daily press., 1885-10-07

sufficient SUN to meet these obligations and to re-
lease the read from the hands OF the receiver,
and which sum added to the amount Of the GER
tifcates issued will make an aggregate OF $780,
900. Nearly all Of this sum is now a first lien up
on Tie pr, pefty of the road and until the certif-
c8tes IRE paid, or a provision made for their pay
IN mt neither the stock nor the bond holders can
assume control of the road.
If we should leave it for the receiver to accom-
plish the payment of the above mentioned
amounts the bondholders would be obliged to
wait from seven to ten years before receiving the
The committee believe that a loan of the whole
necessary sum of S350,000 may be effected by
g 5s as Es sn b be ns
terest at per cent per annunl.
We now come to the readjustment OF the second
mortage indebtedness. We have taken the date
of November L, 1884, when the coupons became
due licxt after the appointment of the receiver.
At that time and now the total
amount of bonds considered as sold
Accrued interest at thai date '..... 4s5, IL
Total amount to be provided for... ss.s73,2
The interest Of the City of
Portland therein. so, 092, 800
persons is ............. 1,7so,714
Tie city having plurality
The liability Of he road
upalf die consolidated
bonds aud notes endorsed
for Vermont corporations
aggregate about ....... 100000
Ard tie unsecured ndebt-
cdneSS net eXccedlng......f l5O,OOO
A new mortgage should net overload the road,
but ii should nevertheless be as large as the re-
sources Of the road will permit.
We have investigated the earning capacity of
Tie read ind there is no doubt that If the finances
OF the road are adjusted as we contemplate, and
its property put in first class condition, as the
means provided will permit, then the net earning
capacity of the road available for the payment OF
fixed charges, viii exceed 100000 per annain,
with o prospect OF fair increase IN the near
future
We propose the issue Of twenty year bonds, Sc
cured by mortgage on the Whole line for 1870.
00G. III traction over twenty-five per cent. OF the
aInpnnt dee Oh the second mortgage bonds as afore
sad ile bonds to bear interest at the rate of two
per cent per annum for the first three years, four
per cent for the next twelve years, and five per
cent for the next five years This interest the road
We also propose the issue of 81 SOC, 900 in pre-
ferled stock, that being the full amount author
lied.
plus earnings above fixed charges, to the amount
Of six per cent per annuin. any excess being at
the disposal Of the holders Of common stock af-
ter tvs dividends
Provided the holders of the consolidated bonds
aid unsecured debts will accept of fair per cent
age OF their claims In settlement thereof we pro-
pose to Issue to them preferred stock. The proper
ton Of this isshe Of stock, to which the city OF
purtlaat would be eutitled, after the payment of
the last nicntioned claims, might deprive it of a
M iiiy If saiii stock. but recognizing the prop
prieiy Il thf city Of Portland, always retaining
ccntr of tbs property, we propose that s76o Ooo
Oh Tie pftICTfeu SLOck Dt lSSutu 10 Tic Slly VI
Polta 8! :ud the balance, after adjusting the
claims aajyc mentioned shall be divided pro rata
amsnr llac private bond holders;
THIS plan will always give the city good ma
jorty OF the common and preferred Steek and al
so practically of all the bonds to be issued, for the
preference bonds being for small amount and
prior lien, always be taken care of by the COM
pany's earnings, and will never come i'll to share
with the city and other bond holders in the con-
troll of the road.
The total indebtedness of the road when so adj
justed will be as follows:
First mortgage on Portland Division...s 100000
Mortgage on whole property to secure
LIST lien preferred bonds $4,000
Bonds in lieu of present I'd mortgage
bonds. ---.........-......... Sfoooo
Total. .s2,12O,O0o
Before the expiration of twenty years, the bust
ness of this road will so increase that with fair
management, its credit will be of the best, and its
indebtedness can then be readily placed as may
then be for the interest of the road.
The advantages to be derived from this plan of
adjustment over any scheme of foreclosure are
manifest
be saved from taxation TO the amount OF many
thousand dollars, will be preserved, the common
stock will be saved litigation and d IT'S saan
economy in the management of the road will be
necessitated by the regular requirements OF the
payment of fixed charges, the diversion OF the in
come of the road to other enterprises prevented,
and the property of the present bondholders In
this road safely secured, protected from accidents
We believe this plan to be emphatieay for the
best interest of all parties concerned, and we urge
delay Of a few weeks, will by the foreclosure de-
prve all parties of this opportunity to save IN per-
petuity this valuable property.
At the conclusion of the reading of the report,
considerable discussion ensued as to some of the
provisions of the plan, although the majority OF
those present seemed to be in favor of its adop-
ton.
aofI do had
not been made sufficiently large to provide for the
payment of the first mortgage, the amount issued
for this purpose to be held in trust until the matu
rity of the first mortgage bonds
Mr. Noyes in reply, stated that it was feared
the adoption of this plan might deprive the city of
Its controlling interest Mr. Woodbury. was Of
the opinion that by this arr ngement the city
would get better bond, but the plan would not
be so likely to be fayorably received by the city
government. Mr.. Brown stated that it would
make no difference to the first mortgage bond
holders what plan was adopted, but that the issue
of bonds for the payment of the first mortgage
would in his opinion be to the advantage of the
city.
Judge Symonds said that he should object to
the placing Of the bonds for the $35o,00O indebt-
edness IN addition to the issue of the $97O00O in
the same mortgage BY so doing the city will be
out-voted in its own mortgage Judge Symonds
asked if it would not be better to take up the
floating debt with the net earnings of the road.
Instead of paying its temporary indebtedness, the
road is perpetuating it in order that dividend
may be paid for few years. The way to protect
the city's interest is not by perpetuating the float
ing debt, which If done once may easily be done
again. Excuses for such course might readily
be found in the future. In the opinion of Judge
Symonds, every feature of the plan reduces the
city's power of control in the company Judge
Syrnonds said that he did not believe in plan
which denied the city's right to its own property.
Mr.. Brown said that the plan adopted by the
committee takes the road out Of the hands of the
receiver.
Mayor Deering said that by taking up the float
ing indebtedness and receivers certificates with
the net earnings of the road seven and one-half
wears would be required in paying the $35o,o0o.
MFR. Moves mentioned the importance of keeping
the city's expenditures at as low figure as
possible.
The issue of preferred stock to the full amount
of 81 800 00o authorized by the legislative enact
ment was the subject of considerable discussion.
The object of this issue was stated by the COM
mttee to be to secure to the city the whole OF its
property to which it was entitled
The Mayor thought the City Council would be
ant to object to the ISSUE and stated that he hoped
10 see the stock scaled down to something ap-
preaching its value.
Mr.. Brown thought that the scaling down would
be hopeless operation
Judge Symonds asked why, II the preferred
stock was to have no value, 1t was expedient 10