Evening journal., 1910-01-21

ing loss OF about Ss6o.OOo. until the
Delaware Road was fully able TO pro-
tect It's own interests.
on the 3lst Of December. 1898, these
roads were consolidated with the Del
aware Road; and in the consolidation,
tho Delaware Railroad Company ac-
qulred about 100000 of its capital
stock, one hundred and seven miles Of
road In full operation, and upon which
S1,400,O00 had been expended in cash,
and subject only to a debt of $780,
600.
Another short line. the Baltimore and
Delaware Bay Railroad, has also been
acquired by the Delaware Railroad
Company, for the same general pur-
pose; some twenty-four miles OF road
costing IL about $4,000.
In July. 1885, in order TO further pro-
tect the traffic Of the Delaware Road,
the Philadelphia, Baltimore and Wash
ington Railroad acquired the Delaware.
Maryland and Virginia Railroad, which
extends from Harrington on the Della
ware Road, via Georgetown 10 Frank
lin City, a point which is south Of the
Maryland Line. a distance Of about
seventy-eight miles, with a branch
running from Georgetown to Lewes and
Rehoboth. a distance OF about twenty
miles. This road had heretofore work.
ed in connection with steamer line
running between Lewes and New York,
and had been an active competitor for
business in the territory tributary to
the Delaware Road; and had been a
most injurious factor I'm the reduction
OF rates below a reasonable point This
road is still owned by the Philadelphia,
Baltimore and Washington Railroad
Company which has advanced over
I S1100,O00 in payment OF n portion of
it's bonded debt, and the interest on
its bonds.
The general situation was materially
modified in July, 1908, through the ac-
QUESTION by the Pennsylvania Railroad
Company Of the entire capital stock
OF the New York. Philadelphia and
Norfolk Railroad Company, which
forms the southern extension of your
line from Delmar via Cape Charles,
to Norfolk. Va. This line, built by in
dependent interests, had built up a
large traffic between Norfolk and
points south thereof on the one hand,
and Philadelphia, New York and points
north and west thereof on the other
Your line is largely dependent upon
it and the Philadelphia, Baltimore and
Washington Railroad. for tho traffic
passing over your rails; the figures
showing that about 20 per cent. OF your
entire traffic is received from connect
ing lines. and that only about 90 per-
cent originates upon your line. or is
destined to local points thereon.
Want Full Understanding.
In considering tho questions. there
fore, TO which special attention had
been called by a number Of outside
shareholders. namely: a distribution OF
either cash or stock dividends to rep
resent the surplus income Of the COM
pany, II seems to your committee that
Il is essential 20 have a full under
standing with the lines north and south
of your road, before expenditures now
absolutely necessary to be made, IL the
present traffic is TO continue I'm the
same channels, should be made; and
before increases OF your capital stock
should be authorized. the power to
earn dividends upon which might be
taken away, or, at least, materially
lessened. by the diversion of the pres
ent traffic over your road.
IL was assumed that. as the Phila-
/ delphia, Baltimore and Washington
Railroad is the owner OF a majority of
your stock, this diversion would not
be made unless required by the in
terests OF that company, but. for the
purpose Of being officially advised upon
that question. and also ascertaining
the views OF tho majority shareholder
upon the question of dividends. your
committee had an interview with its
president. in which the matter was
| fully discussed.