New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1906-02-11
SEEKS BIG BOND ISSUE.
PLANNED BY SOUTHERN.
Stockholders TO BE asked to -da-
fborfsc Raising of $500, 900, 900.

The Southern Railway Company has decided
10 ask the stockholders 10 authorize an issue OF
Ss0n0aaO Of hfty-year development and gen
eral mortgage per cent bonds. OF this amount
SI5o00O0O Viii be issued immediately. as fol-
lows: 81 .9G2 IA TO refund payments for equip
ment heretofore made any charged to capital;
S35o00oo 10 refund investments in securities
OF and advaucements to subordinate companies
heretofore made and for the acquisition of prop
erty not heretofore funded and S6,936.226 for
double track revision OF grades new yards
shops, etc.
me balance Of s1s5Ooo.Ooo viii be reserved
for Tho following purposes: S3l15so0O to retire
divisional prior lien bonds Oh properties ac-
CURED for which no provision is made In the
consolidated mortgage; S16oo0.000 to retire not
later than April !. 1909 collateral trust Us; SIS
0iS00o 10 retire. they mature in the next ff-
teen years equipment capital obligations; SlO.-
100000 10 acquire capital stock Of certain leased
lines. SlO0O000O to pay moi later than July l.
1873 for the eastern division Of the Tennessee
Central and Immediate improvements.
After provision for the foregoing obligations
arc made there viii be left S99S34.00O, which
VIII be used 10 provide for future acquisitions
and bettermeHts, 10 be issued, however, only
under strictly limited provisions OF the mort
gage. and 10 be provided for follows; In each
year not exceeding $5,000000 to be used for
betterments and improvements on the entire
system ana for new equipment and in exchange
FOR first mortgage bonds. not exceeding in
amount the actual cost thereof of railroads and
terminals hereafter acquired.
a special meeting Of The stockholders of the
Southern Railway Company has been called TO
ratify this proposition at Richmond. Va. on
April IS next. Transfer books of the company
viii close April j and reopen April 1s. 1t is
Morgan q Co has been formed 10 purchase the
SI5.000,000 10 be issued now.
After the consumTation Of the purchase of
the eastern division of the Tennessee Central
Railroad. and the retirement of the collateral
trust 5s, the new fifty year development and
general mortgage bonds viii be a first lien upon
al miles OF railroads owned absolutely on 1065
miles operated under leasehold, trackage or
other rights. and The ma jority Of stock of rail
road aggregatins 475 miles The bonds viii also
,be a first lien on stocks which insure the per-
.petua right 10 use freight and passenger ter
minal properties at sixteen Of the principal
cities of the South. including n bridge over the
Ohio River at Louisville. and all future acquis-
hions Of railroads constructed or purchased free
IRON lien with the proceeds Of the new bonds.
They VIII be 2 second lien on LAY miles of
road subject only 10 the existing divisional
mortgages (to retire which, bonds are reserved
under the new mortgase), and upon the acquisi
ton or other retirement Of such mortgages, then
a prior lien. They win be general lien. subject
10 the first consolidated mortgage and to under
lying mortgages. TO retire which the first con-
solidated mortgage makes provisions, on a total
If slS miles Of road, 3S46 miles Of which is
owned absolutely
President Samuel Spencer Of the Southern
Railway Company in a communication to J. p
Morgan. Charles Lanler and George T. Baker
voting trustees of the capital stock Of the South
cru, says:
Tho net income OF the company. after paying all
Used charges for the current fiscal year. will he
about s. 100000. The interest per aunuH 4 per
.ort on the proposed immediate issue of $5,00OO)l
of new bonds would be 100000 IF the $1,000
new bonds were outstanding for the entire fiscal
,-rar me net income would BE sufficient TO pay The
.dditional fixed charges and the full dividend on
mo rraforred stock (s329o0fH1l and and above
Nh This there would remain surplus income for
1..r wear Of about s. l0S go