The Caucasian. (Clinton, N.C.) 188?-1913, 1906-03-01

of Lease May Bring About That Re
suIt-How Stocks Are Pledged-state In
voIved to Extent OF 100000.
Daily Industrial News
Raleigh, Feb. 21.-The suit Of
Mr.. Hill at New Bern to set aside
the lease of the Atlantic and North
Carolina Railroad, from Morehead
City to Goldsboro, has awakened no
little interest here. Some larger
stockholders and citizens who have
examined the facts are now publicly
expressing the opinion that the an
nulment of this lease would necessi-
tate either a sale Of the road or the
imposition of such heavy mort
gage that the road would have to be
sold in few years.
The lease of the old "mullet
road" as it was commonly called,
to the Rowland Improvement Com
pany was perfected at Morehead
City, September l, 1905. When the
lease was made the new owners paid
off the floating debt Of between
$40, 900 and $50, 900; paid cash for
the wood and other supplies on hand
amounting to nearly $4,000, and
have since, as sworn reports show,
expended about 100000 in perma-
nent improvements, consisting OF
new engines, cars, bridges and sta
lions. This expenditure does not in
clude a penny Of the money being
spent in the construction Of the great
bridge between Morehead and Beau
fort.
Should the lease be broken up it is
admitted that this money must inn
mediately be paid back to the How
land Improvement Company. The
aggregate will be over $4,000, 900,
and the payment Of this sum would
be accomplished only by the sale Of
the road or increasing the mortgage,
in the opinion of many.
Besides this, lawyers have ex-
pressed the opinion that the State
would have to pay interest on this
money and besides probably stand a
law suit. It is we'll known that un-
der the lease the State receives $685..
900 annually as dividend ON its
stock, and this 8 per cent. will be
gradually increased. The total the
company is now paying the private
stockholders and the State in divi-
dends is $4,000.
THE POWER TO LEASE.
The State in making the lease
guaranteed the title to the property,
and this of course makes it strongly
probable, so lawyers think, that in
case the lease is annuiled the How
land Company can secure redress at
law. This power to lease is thus
stated in the lease (Which, by the
way, runs so as to expire at the same
time the lease of the North Carolina
Railroad terminates):
"And the lessor, for itself, its sue
cessors and assigns doth covenant
and agree to and with the lessee, its
successors and assigns that at the
time of the consealing and delivery
of these presents, it is seized and
possessed and entitled to the premi-
ses, property, rights, franchises and
privileges above conveyed in the
estate and for the terms demised,
except as hereinafter stated, and has
good right, full power, and lawful
authority to lease, farm out, convey
and deliver the same in the form
and manner aforesaid, and that the
same are free and clear from all liens
and encumbrances Of whatever kind
or nature soever, save and ex-
cept the lien and encumbrances of
a certain deed Of trust or mortgage
to secure certain coupons Of the said
lessor heretofore issued and now out
standing, and amounting to about
S335,OOO that the said lessee, its
successors and assigns, shall during
the entire term aforesaid have and
enjoy quiet, peaceful and uninter-
rupted possession of all the property,
rights, privileges, franchises and es-
tate hereinbefore leased and farmed
out and that the said lessor and its
stockholders and directors will not
do anything or take any action as
such stockholders and directors that
may or can interfere in any way
whatever with the free use and OPP
Grafton and conveyance Of said rail-
road and other properties so hired,
let, farmed out, and delivered to the
said lessee, according to the terms
and intents Of these presents"
MAY FARM OUT TRANSPORTATION.
The power to lease is delegated in
section Is of the charter, which
reads:
''That the said company may.
when they see proper, farm out the
right Of transportation over said rail-
road, subject to the rules above men
toned, and that the said company
and every person who may have re-
ceived from them the right of trans
pOrtatiOn of goods, wares and pro-
duce on said railroad shall be deemed
common carrier as respects all
goods, wares and merchandise en-
trusted to them for transportation"
The Supreme Court Of the State