Vermont phÅ“nix. [volume] (Brattleboro, Vt.) 1834-1955, 1897-10-15
THE CENTRAL VERMONT, /
Change of Control of the Road.

The Grand Trunk .RailrOadi will Take
Possession Of the Property According
to Vote Of the Bondholders ut Their
Adjourned Meeting i'm Boston. Tues
day.
The result of the adj burned meeting of
Central Vermont certificate holders, held
in Boston Tuesday, was vote to accept
the report and plan of the reorganization
committee. This result places the Cen
trail Vermont practically in the control OF
the Grand Trunk railroad company OF
Canada. one of the largest creditors of the
Central Vermont company
The main point at issue was whether
the bondholders would agree to accept 50
per cent of their present holdings of per
cent bonds i'm new IS, the interest on the
new bonds to be guaranteed by the Grand
Trunk Railway company under a trathc
contract whereby the Grand Trunk agrees
that If the net income of the new COM
pany is not sufficient to pay the interest on
the first mortgage bonds and series bonds
it will make good the deficiency, provided
it is not required to pay more than sum
equal to 80 per cent of the gross receipts
from traffi, in,ercharged with the new
company.
Moorfield Storey, counsel for the re-
organic alton committee, gave an outline
of the committees work during the Is
months of its existence, repeating his
statement made at the meeting last
week of the unsuccessful attempt TO in
terest any other company than the Grand
Trunk in the Central Vermont property.
Our first inquiry. he said, was whether
there was not some railroad or other in
terest which would step into our shoes and
take our first mortgage, and buy 1t out.
We waited Is months for somebody TO
buy. The Boston II Maine did not want
to talk with us on any terms. We got the
same answer from the Canadian Pacific.
Tue Fitchburg was tried with the same re-
suit. We have been openly in the market
trying to find some one who wanted TO
buy your securities, and we have not found
anybody Finally the Grand Trunk came
along with the proposition above outlined,
and the committee considered this the
most feasible solution of the problem pre-
sented to them.
There is a large volume of preferred
claims against the Central Vermont, not
less than 100000, of which the Grand
Trunk holds $43j, 600. The road might
be placed in the hands of a receiver, but it
is doubtful if the bondholders would be
permitted to name the receiver, and 1t is
important that he sh juld be tirst-class
railroad man. Litigation would probably
follow, which would be uncertain and pro-
tracted, during which time the bondholders
would get no return on their investment.
Another alternative is for the bondholders
to operate the road themselves, but 81 ,O00,-
ILL L., al al Cor ha In
ment of the road, after which other roads
necessary for the operation of the Central
Vermont would have to be leased. The
best way out, everything considered, is for
the Grand Trunk to take the property op
the terms proposed.
There was lively opposition to the COM
mittee's plan, and charges were made that
personal considerations had influenced the
committee decision. Itappeared that OPP
position has also developed from holders OF
Ogdensburg Transit company bonds and
from the Smith estate. President Crosby
of the Massachusetts, Loan and Trust com
pany asked if it was true that the lease o.
the New London and Northern during the
past eight months had been Improbable
and also if an expert examination of the
property had been made. The committed
was not in position to answer the frs
question, but Ezra II. Baker explained
that an expert examination had not beer
made, as it was not desired to incur sucl
an expense to the bondholders, but tina
two members of the committee had made {
complete examination.
Mr. Storey was asked if the physical con
dition of the Central Vermont road wa
determined by a careful examination b!
experts. He replied that it was plain Il
the most casual observer that the bridge
are so badly out of repair as to be dan
gerous, that the rails are too light for tn,
heavy traffic passing over them, and tina
the rolling stock should be renewed. l
was because of this general condition o
the property that the statement was mad'
that 100000 will be required for thu
proper equipment of the road.
When vote was finally taken on tn
acceptance or the reorganization plan i
stood: Total cast, SO, 44S, 200; bonds il
favor, $2,771, 400; against, 1910, 800. A
twO-thirds vote is required, the plan wa
accepted by 600
This Action May Not BE Final.
The Burlington Free Press of yesterda,
says it is only natural that local pride il
Vermont should cause a feeling Of regre
Central Vermont property into the hand
of corporation outside the state, an
controlled by the laws of another country
1T is to be noted. however, that the ac
ton taken at the meeting of the bond
holders in Boston on Tuesday was merel
preliminary, and that there is as yet no Ger
tainty that the Grand Trunk can success
fully take the steps which must necessa
rily precedr its control of the system. TIL
second mortgage bondholders and othe
interests remain to be satisfied, and Will
the opinion has been expressed that thi
could be accomplished without the neces
sty of another meeting of the bondholder
it is significant that at the meeting o
Tuesday certificates of only SO, 44S, 20
bonds were voted, whereas the certificate
deposited with the committee representa-
So, 100000 of bonds and the number vot
ing in favor of the committees plan wa
only little over a third of the total mum
Der deposited, that vote representing 81,
III 400 1t is not impossible therefor
that the adoption of distinct plan in &C
cordance with the program outline
might meet with successful opposition a
another meeting of the bondholders.
Moreover the property is now unde
the control of the United States court, ar
while it is not possible to accurately an
ticipate the action of the court it is safe /
say in the light of past decisions tina
Judge Wheeler will insist upon the adop
ton of some plan that shall ensure tn
protection of all interests having claim
against the property, Just how the pa
proposed by the committee of bondhOlder
will be regarded by the court now havin