The Portland daily press., 1888-07-26

trail will not consent to the lease of its own
valuable property without sufficient induce
nens, ana that some portion of the benefit
resulting to it from such consolidation would
inevitably flow to the Portland & Osdens-
purg; But, rejecting this theory. and grant
Ing tnat our interests should be opposed to
Maine Central consolidation, and, by the
Terms OF the lease, we could not enforce them
directly, DO we not still have resource in
opposing legislative permission for such con-
solldation; and allowing that we were un-
successful in this respect and in spite of all
eHorts, consolidation of the Maine Central
win some other system was accomplished,
the I. * y. being carried with it, submit
whether our interests would be left in q
worse condition than would happen if the
road should be taken back by the city and be
maintained as piece of independent rail-
way, surrounded on all sides, as 1t might be,
with unfriendly connections.
4.-Objection is made that the right to en-
ter and take possession for breach of condi-
tions is limited to four instances, and refusal
to pay taxes, ETC., is not included in these.
Does it seem probable that the Maine Cen
tral while running the p. d o. road. paying
rental therefor, and maintaining all the 9TH
er covenants of the lease, is going to refuse
to pay taxes upon its property so as to rem
der II incumbent upon us, in order to protect
ourselves against such neglect to enter and
take possession of the road? 1t seems to me
that such contingency is out the range of
probability.
5.-We come now to consider what is
termed the most Objectionable feature of the
lease, viz, the provision relative to mortgage
ing
/ In regard to this section would say that
the lease as originally drawn by Judge Sy-
monds permitted the Maine Central to mort
gage only their leasehold interest in the road.
ms proposition was rejected by the Maine
Central upon the ground that, as the road
was being; practically, purchased, the right
equitaDly BELONGED to them to mortgage, es-
peclally as bonds could not well be negotia-
ted which rested upon the singular secarif,,
Of q. tedsehotd interest. This question was
further discussed at meeting of the sub-
committees of both boards at which the CITY
Solicitor, though unavoidably absent. was
represented by another attorney. AT this
meeting Il was agreed that the Maine Gem
trail would be justly entitled to mortgage the
property, but that such mortgage should be
restricted as to amount and applied for spec
Tic purposes. Now what are the objections
to TINS mortgage Is st y that the AMOUNT per
brance on the road at the present time. in
GLIDING RECEIVERS lien and mortgages. l.
about 81. 100000, which sum the Maine Cen
trail assumes. 1t also agrees to pay rental.
after three years, OF per cent. annually up
on more than $4,O00,O00 stock.
This rental is payable quarterly, and, con-
sidering the credit of the Maine Central cor
poration, will make the stock worth 80 per
cent of its par value, or a sum exceeding So.
600, 900; adding this sum to the S1I0O. 600
makes price OF more than $3,100,C90 which
the Maine Central virtually pays for the
road, or at least $35,000 per mile. New does
a mortgage of $4,000 per mile appear ex
cessive, especially when it is stipulated that
all of the proceeds of the mortgage shall be
devoted to the road?
But il is said there is no safeguard against
misapplication of the mortgage bonds The
first security exists in the honorable charac-
ter of the Maine Central directors, but be-
yond that, these bonds cannot be issued ex-
cept as they are furnished by the directors of
the p. & O.. road, and will the directors of
that road furnish, or be required to furnish,
them faster than they are needed for the pUr-
poses specified in the lease? Does not the
lease imply that the Ogdensburg directors
have some discretion in the matter of fur
nlshlng bonds, since, provision is made for
reference 40 the railroad commissioners IN
case o<any disagreement as to their proper
appHcation on new construction or perma-
.hent improvement? If the Maine Central
Board. has unqualified power to call for
these bonds. and use them without let or
honestp.why was the provision for reference
inserted in the lease? 1t seems to me that
the power to mortgage is reasonably limited
as to amount and securely guarded as to ap-
plication.
OF course, If the p. and o. should come
back to the stockholders, it would be held
for the mortgage. but in what respect
would it be worse than now? Instead of a
receivers lien and other liabilities on the
road, there would be mortgage upon fixed
time guaranteed by the Maine Central,
the holders of which would be likely to
collect their interest from the Maine Gem
trail, II responsible; in which case the p. &
y. could, when subsequently proceeded
against by the Maine Central, offset any
damage inflicted by termination of the
IN In
gency, the bankruptcy of the Maine Cen
tral, the T. d. 0. would have but compare
lively little more interest to assume than
is paid at present, and the difference would
represent increased benefits to the road.
therefore, there need be no serious appre-
henslon about granting the right to mort.
gage as Section IA provides.
In ADDITION to the foregoing objections
raised by Judge Symonds we hear the gen.
eral objection urged that the lease con-
talns no penalty for forfeiture.
While such provision would be most
extraordinary in document of this nature,
yet the objection may be answered that
any forfeiture of the lease would carry its
own penalty. There is no power in this
lease which can compel the stockholders of
merely provided that they may take it back,
II they so elect, for breach of condition.
III the Maine Central fails to pay interest
or rental. It is liable to suit and attachment
81 Its funds and property: At the present
time IL is paying per cent.dividend upon its
stock. Surprising, after the execution of
this lease, 1t should then, for any reason, de-
fault. The declaration of any dividend to
stockholders could be prevented for an in
definite time, thereby causing heavy depre-
citation IN the value of the stock as well as
| loss OF dividends. In this manner alone
forfeiture Of lease for any other reason than
| absolute failure would inflict SO heavy pen.
atty upon the Maine Central stockholders
that they could i'll afford to terminate the
| lease, even if they had a disposition so to do
While listening, the other evening to the
| faithful admonition of Judge Symonds upor
| the nature of this important covenant, was
III permitted to indulge in bit of pleasant
ry.-reminded Of the story of the magistrate
| who advised couple about to enter wedlocl
| that lit was a solemn thing to get married,
| whereupon he was answered, Eyes, Squire,
| it is q solemn thing to get married, but It is d
| solemner not to-" The independent or un
| welded condition Of the p. e O. has been
| source of solicitude and risk-not to SPEAK
| of mingled profit and loss-to our city since
| its infancy up to its present age. Now, hav.
| ing reached maturity through skillful train.
| ing and guidance, notwithstanding all the
possible chances OF contract the city fathers
| may well give their consent to its union,
with its only sutton, especially since
such union promises happy and useful
results. In point of fact | think such a
union is decided by:
1.-Commercial considerations. Although
Portland is the nearest Atlantic port to Min
neapohs and the great Northwest yet we OBJ
serve the products of that territory, destined
for Europe, instead of coming here, passing
down by US on the other side of the noun.
tains to Boston. What is the occasion fol-
this? Simply that we have neither terminal
facilities here to accommodate such business
nor regular steamers to furnish transporta.
ton abroad. How are we going to secure
them by holding on to the +. Il O? Certainly
neither the z. d o. railway nor the city is
able to furnish elevators or dock facilities fol
foreign cargoes.
The Maine Central is strong enough to pro.
vide such terminals, and we have the assur
ance of its officers, backed by the self-inter.
est of the road, that it win strive to deyelop
Portland as point of transhipment. have
already alluded to the extension of the Cana.
dian Pacific through the interior of the State
and the Importance of leasing to the Maine
Central in order to prevent the diversion OF
traffic to the North and East of our city
Again, there is another consideration Under
the management of the Maine Central, local
rapidity along the line of the p. d o., all OF
which will rebound to Portland's benefit.
Financial considerations urge tine &C.
ceptance of this lease. Much is said about
high taxation. There is complaint of its
burden. Margins Of profit in business are
| small and daily growing smaller. This lease
affords an opportunity for relief, and the on
| ly opportunity within our grasp, as munich
| pal expenditures are already restricted with.
| in the narIowest practicable limit The p.
| & o. road has never, directly, yielded any
| income to the city. nor have its securities
been reckoned at any value In the statement