New-York tribune., 1897-11-16
flnauela..
New-York. November I. le''
TO THE HOLDERS OF
CONSOLIDATED MORTGAGE
FIVE PER CENT. GOLD BONDS
OF THE
Baltimore & Ohio
Railroad Company
DUE i9s8)

Since the appointment Of Receivers for tn. Baltimore
and ohio Railroad Company In February 1896. we have
endeavored to watch carefully and TO all steps neces
sary 10 protect the rights OF the Five Per Cent consoh
dated Bondholders.
Almost Immediately after their appointment the Re
eevers expressed the opinion that u allowed to issur
5000 COO Receivers Ccrtcates used for dscharg
ing accumulated supply bills and for making some needed
additions 10 the property they could thereafter regularly
meet the Eteres, the several Issues OF bonds toi
which the y. & o. X. X. Co. directly responsible
and which constituted Hens the principal railroads o.
the system.
Recognizing the advantages likely to from hold
Ing together all the properties and also undersandnb
that the greater part the $500 900 certificates were to
be used to discharge SUPPLY bills which would prooao!
be held by be preferential liens. we with
others Interested the Consolidated bends. favored the
Issue Of such certificates
OF late the Receivers have been unable TO fulhi the
expectation defaults have taken place on several Oh
the lines important the integrity OF the system since
these defaults have felt that the object OF the original
Issue having failed further Issue OF certificates Tor any
purpose should be made by the Receivers and therefore
We have opposed all such further issues.
In the Spring Of 1891 the Johns Hopkins University
fled In court application asking that the SoooOOW
nrst preferred stock Of the b. o. II. R. Co. should os
declared lien the income Of the property ahead or
the Consolidated Mortgage Bonds The Trustee Of the
Consolidated Mortgage filed which was deemed
adequate to set forth the rights Of the bondhodes
few days before this application to be heard by the
Court learned that this had been Withdrawn
by the Trustee and that sesd there had been filed
another merely formal in character stating that
the Trustee had Views In the matter and leaving the
determination Of the question the Court The reason
for this sudden change perhaps be given best by the
Trustee. who inquiry. informed OF US that 1T
differed decidedly with us In regard to the d. o. pre-.
ferred stock. and that this new idea with IL;
"tha, had held this opinion for many long before
1T accepted the OF the Consolidated Mortgdge, and
that The purpose Of the Company In amending is an
''ewer was 10 remain in a neutral position.
Immediately upon hearing OF the changed and 'neu-
tra attitude OF the Trustee whom had been rely
Ing for the protection Of the rights OF the bondholders
communicated with OF tho large bondholders.
and took tor independent interventn In their
behalf and in behalf OF all other bondholders Although
subjected to in the preparation OF papers
the fully presented by counsel. and are
happy to say tina, tnotwhstandins tho views Of the
Trusted the Cour; has decided In favor OF the Conso
dated Mortgage and has denied the application Of the
University We 10 know whethe- the University Will
appeal from this deeiioa. but II So we shall
continue our opposition.
More recently the Trustee OF the Pittsburgh and Con-
nellsve Five Cen, Consolidated Mortgage has flied
a petition. OF which the granting would in effect be
declaration that rs mortgage la. lien equal with yours
n the main line ot the y. & o. r. II. We now Wig
.ly opposing this application.
We mention these matters simply TO give tho holders OF
the Five Consolidated Bonds idea Of the
unusual phases which matters taxing On questions
other OF First Preferred Stock the Trustee
has communicated wlth us and und'r as Indemnity from
U.s. has allowed counsel TO cooperate with ours We
DO believe that 'he Receivers will default In the pay
men, Of interest except under dir. necessity; and SC
long there is default the paynen; Of interest
your bonds tn performance Of the other undertak
ngs o, mortgage there would not under ordinary
conditions bs any 'or anxiety. But the very un
usual attacks on integrity OF your mortgage apar
from any default the cancellations Of the presen:
eciy. ship a. well III. novel suggestion OF "neu
| trail" Trusteeship. indicat. necessity for constant
| aaichfIIness ana vigorous action
Il seem, Important therefore. that the bond
holders With protect their interests; and. ac-
,oriingiy have prepared B5niholders' Agreement
which. Other things provides ,or the deposit Of
| bonds with AessFs J, r. Morgan Co.. and gives US al
ecessay pove' that bondholdsrs represen,e
IN all well as power 10 press fore
| closure p5oce-dIngs In case o! default
II these purposes Themselves will 20,
be good enough iepon your bonds with MesSs J. p
Morgan Co. o. or beior. January 2 is0s receiving ir
exchange therefor certnca,es OF deposit for which
| tation n du. time will be asked from the New YorH
STOCK Exchange. Thes. certificates for 5000 each
arl bear Interest cjrrcs7oling 70 the
maturing the bends Tor the next i've years. As fast
an coupons are collected !. r. Morgan Co VIII pay th'
amour, thereof on surrender Of TIE corresponding
| rants
We cannot undertake repr-sen, any bonds which shall
not have been deposited before the date above ni
| Gated.
Thers may obtained at our ofncss statement fur
ni.hed showing IN. earnings and nxet
charge, ~ the property covered by the Consolidated Mort
gage We believe this will be reassur.nE q
boz ihoders that viii show them the necessity
additional tisns 10 be imposed on th'
property covered by their mos'ge In priority therso u
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