The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1901-01-15

Act OF February. 1855 as amended by
the Act of December. 1855: that by the
Act of 1896 these bonds We're secured
by statutory mortgage on the states
stock in the North Carolina Railroad
Company the extent OF amount |
| Of the par OF the States stock equal to
| the par Of said bonds: that by the Acts
Of 1s4s and of 1855. the thirty thousand
| shares of stock owned by the State
| three millions par and now worth at
market prices about frye millions Of
| dollars). were mortgagef to secure the
| Construction or First Mortgage Bonds:
| that the amount of these first mort gage
| bonds now outstanding is 8. oeo:
| that these bonds issued under the
| Acts OF lS49 and 1855 fell due In or abou,
the years 1850 TO 1885,: that in 1850 the
State entered into an agreement with
the holders of the first mortgag" bonds
by which naw six per cent. bonds We're
TO be issued 10 mature in 1919. such new
! bonds to be an extension of the old
| bonds AMI to hold on the States stock
| the same lien or security as that which
appert tanned 10 the old bonds: that the
holders of the second mortgage bonds
acquired them before the matt rity OF
the first mortgage bonds and thereby
took the right TO pay of the first mort
gage bonds at their maturity. and that
the mortgagor. the State, and the first
mortgages. could not lawfully enter
into an agreement for the extension of
the first mortgage bonds without the
consent Of the second mortgages: that
the holders of the second mortgage
bonds were not parties 10 the agree
| nent for the extension of the first
mortgage bonds and enforce their own
lien against the States stock for the
payment of their own second mortgage:
and they ask the State to waive its
sovereign immunity from suit and sub
nit Itself o the courts to the end that
the rights ti the parties may be deter
mined, and they seek to show that ii,
the courts should hold in their favor.
the State would not only pay off what
they claim is an honest debt. but would
also save cry large amount o money
, by being rcle ased from the obligation
, to pay six per cent year on S2.I2O.O00
I for nineteen years when II can and
= does borrow money for much less than
four per cent a year.
J.. In the state Compromise Debt Law
D Of 1879. he second mortgage bonds
4 are scheduled at twenty-five cents on
the dollar Of the principal. and they are
now fundahlc in new four per cents. at
a this rate.
= ter to the courts, and the courts should
r hold in favo" of the views Of the sec
s ond mortGage bond holders. and if these
g second mortgage bond holders shOulC
s agree that in case the courts ShOulC
n decree in their favor. they would sur
= render their bonds by taking not more
5 than $500. 900 out of the proceeds Of thu
= sale of thu States stock. it would re
3 uure in round numbers about three
- millions Of dollars to pay OFF the tWt
e mortgages. This would leave the Stat
still holding unincumbercd stock worth
II about two millions on the market. O
the State by purchasing AT the iudicia
" sale could retain all it's stock and Dor
e row the three millions by the issue o
e bonds at very low rate of interest
y probably three and a half per cent.
IS 1t is to be remembered that thes
e. first mortgage bonds are greatly price
x by their owners and demand hlgi
e prices on the market. Their value. o
e course. is based upon the fact that tn
! collateral pr mOrtgaged stock is wort
nearly double the amount of the bond
l. and the further fact that while none:
= OH the best securities commands Onl,
>l three per cent. these bonds call for 81.
u per cent. for nineteen years. If TIL
General Assembly should take this mat
s ter into consideration. it should also b
a subject Of inquiry as to whether il
!, the submission by the State to tn
. courts. there would be an element o
=. bad faith toward the first mortgag
- bond holders who would perhaps con
49, tend that. the State in 1880 promise
to pay them six per cent until 1919. thi
,. promise should be performed withou
regard to the claim of the second mort
49, gage bond holders.
% 1t is to oc observed that il the Lcgis
%. lature should decide to make avaiIabl
j. for the common schools and college
j. and charities, this valuable asset G
- the State-lts thirty thousa nd shares Q
Ok stock in ,hn North Carolina Ra lroa
vi Company--or any part of it. there
Of no way to DO it. except by Giscnargin
te the liens upon it. because with thes
s. incumberances outstanding. purchaser
II could not De found who would pay fo
IN a share of tbs stock the same price a
is that which they would pay for u sha,
ne of private stock.
re THE: ATLANTIC RAILROAD.
%. This property has not paid any d
~ Nidends during the years 1899 and 100
1T appears that it's management ha
"A used its nc, earnings in improving i,
- property. IT seems that the stock Ia
~ been selling at about twenty-five ps
% cent. of it's par. At this price, sal
=, OF the States stock would realize
~ round numbers three hundred thousan
"a dollars. II : reasonable price could !
- obtained, this property furnishes an as
-, set available for increased expenditure
l. GOVERNORS SALARY AND TIL
On MANSION.
al The state provides for the GoVernt
IS and his family Mansion spacious an
stately and we'll adapted to entertain
a ments and social occasions. The libe,
lie atty of Mr.. George Vanderbilt has in
Ii proved the Mansion grounds and mao
lis them more attra ctivc. The salary
the Governor is not adequate. to me.
er the demands imposed upon him by II
be environments which surround hin
We Speaking from experience Of four year
he say that serious pecunfary loss is in