Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1915-02-17

at frequent intervals is a disturbing
factor. So is the invalid status of
substantial portion Of the stock un-
der Massa chusetts laws. If these dis
turbing factors can be removed and
If the floating debt can be funded at
lower interest charges. the situation
and the chances OF securing the new
capital needed for Improvements will,
to that extent, be improved.
Validate Stock
1.-The quickest and surest way to
bring about this result is for the general
court to validate the stock and directly
authorize the funding Of the floating
debt
THE New Haven capital has not con-
formed either to the letter or to the spir-
it Of our statutes. 1t has not confined
its activities to a legitimate railroad
business nor is there any presumption
that its capitalization represents as
whole investment honestly and prudently
made. even within the elastic limits Of
its Connecticut charter.
BY Friendly Legislation
The evils which have fallen upon the
New Haven Co. have been due not to
too much hostile legislation but too much
friendly legislation"
The commission then cires the Connec-
ticut laws and recommends that the
company seek the following changes in
that state:
IA change so that il will no longer be
possible for the company TO acquire and
hold, either directly or indirectly, the
stock and security of any other corpor-
alton which it does not now control
PA change depriving the company Of
the powers and privileges to which it
succeeded upon its merger with the Con-
solidated Railway CO. ~ Connecticut,
except 50 far as such powers may be
necessary for the operation and main
tenance OF any property which it now
possesses.
"a change which Will no longer make
il necessary for majority of the direc-
tors of the company to be residents Of
any one state.
A change so that il will no longer
be possible for the company to issue I'M
limited stock and securities or to make
unlimited guarantee of the securities Of
lie supervision and regulation.
The validation act presented by the
commission is 50 drawn as 10 cover only
stock issued and outstanding in the
hands of the public and does not vail
date the 22S991 shares which the COM
pany holds in the treasury. This treas
ury stock should be cancelled. the COM
mission says. adding that the company
has given assurances that ii is 10 take
steps in this direction at once. If this
step is not taken. the commission advises
that the act shall not take effect until
such cancellation is accomplished.
Among the provisions in the proposed
act are that the premiums paid in upon
shares Of stock issued under the act Of
1894 should be included in determining
it's debt limit: that the commission shall
have power to secure fun information
in regard to all the New Havens sub
sidary companies and their affairs; that
the holders of convertible debentures
should have the right, now conferred IN
der the Massachusetts statutes only 10
stockholders. to participate in the right
70 subscribe for future issues of canita'
stock. and that the expenditures of the
proceeds from the sale of numerous Sc
ourities held by the New Haven Co. or
dered by the recent decree Of the federal
court should he subject 20 substantially
TIE same public supervision as provided
for in the case of the issue OF new sccur-
tiles and the expenditure Of ne proceeds
from such issues
Drafts of three general bills also accom-
pany the report of the commission. The
first is perfecting re-draft OF the acts
OF jsl3 relative to the issue by railroad
corporations of stock. bonds, notes ard
other evidences Of indebt edness Another
would allow any railroad corporation to
issue preferred stock of one or more diff
ferent classes, and a third would pro
hibit the issIe by railroad corporations
of fractional shares.
The commission states that while infcr-
NAL conferences with public service com
missions OF other states have been held
and an attempt made 10 encourage a
movement towards the enactment Of uni
form laws throughout New England. the
report is made upon the sole response
bility Of the Massachusetts commission
in compliance with a resolve Of las
year providing for an investigation Of
the relations Of the railroad companies
TO the statute laws of this and Other
states.