Evening star., 1938-08-18

and which obligations, 80 long Is any
thereof shall be outstanding and un-
paid or unprovided for shall be secured
either by an instrument-U) vesting
title to such equipment free Of encum-
brance in q trustee; or (2) creating .
first lien on such equipment; or
90 pending such vesting Of title, or
the attachment of such lien, providing
for the deposit of cash in trust to an
amount equal to the face amount of
such obligations issued in respect of
such equipment, title to which Is not
yet so vested or subject to such lien.
The maximum amount of such obliga-
tions so issuable shall not exceed
eighty per cent Of the cost of such
equipment, and the owner. purchaser
or lessee, or the owners, purchasers,
or lessees. of such equipment shall be
obligated by the terms Of such obliga-
tions or of such instrument-u) to
maintain such equipment In proper
repair; ca to replace any thereof that
may be destroyed or released with
other equipment of equal value, or, II
released in connection with a sale
thereof. to deposit the proceeds of such
sale In trust for the benefit of the
holders of such obligations pending
replacement of such equipment; (3) to
pay any and all taxes or other govern
mental charges that may be required
by law to be paid upon such equip
ment: 90 to payc,in accordance with
the provisions Of such obligations, or
of such instrument. to holders, or to
such trustee for the benefit of holders
of such obligations the amount of in
terest due thereon, or of the dividends
payable in respect thereof; go to pay
the amount of the entire issue of such
obligations, within a period Of not ex-
ceeding fifteen years from the first
date of issue Of any thereof, In ap-
proximately equal annual or semi
annual installments beginning not
later than three years after such date
of issue.
C. For the purposes Of this section:
ahlodhG vi AlSouiC oNuA0blC
for fixed charges shall be the amount
obtained by deducting from gross in
come all items deductible in ascertain
ing net income other than contingent
income interest and those constituting
fixed charges. Fixed charges shall
be-rent for leased roads, miscellane-
Gus rents, funded debt interest which
the corporation has Internationally
promised to pay. interest on unfunded
debt and amortization of discount on
funded debt.
2. Other accounting terms shall be
deemed to refer to those used in the
accounting reports Of common carriers
as prescribed by the accounting regu-
lations of the Interstate Commerce
Commission.
8. The revenues. earnings, income
and fixed charges of any railroad cor
poration all or substantially all of the
railroad lines of which shall have been
acquired through merger, consollda- =
ton, conveyance. or lease, by another
railroad corporation and shall remain
in its possession shall be deemed to
be revenues, earnings, income and
fixed charges of the latter corporation.
Section v. Public Utility Obliea-
tions. subject to the following provi-
sions:
A. As used in this section, the words
"aualified public utility corporation"
shall mean a public utility corporation
which. at the date OF the investment
of the fiduciary, meets the following
requirements:
l. It shall be q public utility cor
pora ton, incorporated under the laws
of the United States. or Of any State
thereof, or of the District Of Columbia;
2. 1t shall be an operating company,
and transact, wholly within the
United States, the business OF supply
ing water, electrical energy, artificial
gas or natural gas, or telephone serv-
ice. which service shall be supplied
for light. heat, power, communication
and other purposes:
3. 1t shall be subject to regulation
by public service commission, pub
lie utility commission, the Federal
Communica tions Commission, or any
other similar regulatory body duly
esta blished by the laws OF the United
States, or any State thereof. or Of the
District Of Columbia in which such
corporation operates;
4. It shall have been in existence
for q period Of not less than eight rs
cal years, and at no time, within the
period of eight fiscal years immedi-
ately preceding the date Of such in
vestment, shall such corporation have
failed to pay punctually and regularly
the matured principal and interest OF
all its Indebtedness. direct, assumed
or guaranteed, but the period of life
of the corporation, together with the
period of life of any predecessor cor
poration, or corporations from which
major portion of its property was
acquired by consolidation, merger. or
purchase, shall be considered together
In determining such required period;
5. It shall file with the public serv-
ice commission or other similar regu-
latory bodies having jurisdiction over
it, or with the Federal Communica-
tions Commission, and make public In
each year, a statement and report OF
the income account covering the pre-
vious fiscal year, and a balance sheet
showing in reasonable detail the assets
and liabilities at the end of the year;
6. It shall have all the franchises
necessary to operate in the territory
in which at least seventy-flve per cent
of its gross revenues are obtained.
which franchises shall either be inde-
terminate permits of, or agreements
with, or subject to the jurisdiction OF
a public service commission, or other
duly constituted regulatory body, or
shall extend at least five years beyond
the maturity Of the bonds;
7. (a) If such corporation Is a pub
lie utility corporation supplying other
than telephone service, the gross op-
Grating revenues shall have been at
less than 81, 900, 900 in each year, for
at least four out of five OF its fiscal
years next preceding the date of in
yaefrnnnt ord inc1,1dipo ifs Aera1 vaor