Слике страница
PDF
ePub

The following statements show the operations of the company for the fiscal year and the company's general balance sheet on June 30, 1899:

Comparative statement of earnings and expenses.

[blocks in formation]
[blocks in formation]

This company was originally chartered June 28, 1861, as the Central Pacific Railroad of California. On June 23, 1870, it was consolidated with the Western Pacific Railroad Company under the name of the Central Pacific Railroad Company. By another consolidation, on August 22, 1870, with the California and Oregon Railroad (organized January 16, 1868), the San Francisco, Oakland and Alameda Railroad (organized October 15, 1868), and the San Joaquin Valley Railroad (chartered February 5, 1868), the present company was formed. The road of this company is now operated by the Southern Pacific Company under a lease for ninety years from January 1, 1894, by the terms of which the operating company pays from the earnings all the expenses of operation, fixed and other charges, including sinking fund and United States requirements, and $10,000 yearly for organization expenses, the Central Pacific to receive net earnings up to 6 per cent of the stock, and all excess to be equally divided between the companies. Under the acts of July 1, 1862 (12 Stat., 489), and July 2, 1864 (13 Stat., 356), thirty-year 6 per cent bonds were issued by the United States to aid in the construction of the Central Pacific, amounting to $25,885,120, and of the Western Pacific, amounting to $1,970,560, making a total of $27,855,680, which were secured by second mort

gage on the properties, the company's first mortgage being a prior lien to that of the United States.

As the company defaulted in the payment of these bonds upon their maturity, and also of the interest then due, a commission, consisting of the Secretaries of the Treasury and the Interior and the AttorneyGeneral, was appointed by Congress to settle this indebtedness. This commission reported the following plan, which was adopted and is being carried out:

REPORT OF THE COMMISSIONERS APPOINTED TO SETTLE THE INDEBTEDNESS TO THE GOVERNMENT GROWING OUT OF THE ISSUE OF BONDS IN AID OF THE CONSTRUCTION OF THE CENTRAL PACIFIC AND WESTERN PACIFIC RAILROADS.

To the House of Representatives:

WASHINGTON, D. C., February 15, 1899.

The undersigned commissioners, appointed by the deficiency appropriation act approved July 7, 1898, to settle the indebtedness to the Government growing out of the issue of bonds in aid of the construction of the Central Pacific and Western Pacific railroads, would respectfully report that they have concluded a settlement of the said indebtedness with the Central Pacific Railroad Company, the owner of the said railroads. A copy of the agreement of settlement is herewith transmitted.

The settlement is made as of the 1st day of February, 1899, at which date the amount due to the United States for principal and interest upon its subsidy liens upon the Central Pacific and Western Pacific railroads amounted to the sum of $58,812,715.48, that being the full amount necessary to reimburse the United States for the moneys paid for interest or otherwise in aid of the construction of said railroads.

Said indebtedness is, by the agreement of settlement, funded at the amount aforesaid into twenty promissory notes, dated February 1, 1899, payable, respectively, on or before the expiration of each successive six months for ten years, each note being for the sum of $2,940,635.78, which is one-twentieth of the total amount due. Said notes bear interest at the rate of 3 per cent per annum, payable semiannually, and have a condition attached thereto to the effect that if default be made in any payment of either principal or interest of any of said notes, or any part thereof, then all of said notes then outstanding, principal and interest, shall immediately become due and payable, notwithstanding any other stipulation of the agreement of settlement.

It is further provided that the payment of the principal and interest of said notes shall be secured by $58,820,000 of face value first refunding mortgage 4 per cent gold bonds to be hereafter issued by the Central Pacific Railroad Company, or its successor having title to the railroads now owned by said company and specified in said agreement, such bonds to be part of an issue of not exceeding $100,000,000 in all. Said bonds are to be secured by a mortgage upon all railroads, equipments, and terminals now owned by said Central Pacific Railroad Company, which mortgage shall be the first lien upon such property, or shall be secured by the deposit as collateral security therefor of certain percentages of the now outstanding bonds upon said property, or the different divisional parts thereof. The form of such mortgage is subject to the agreement of the parties to said agreement of settlement, and has been approved by the Attorney-General.

The agreement further provides that Speyer & Co., who are a party thereto, shall, within one month after the delivery to the United States of the settlement notes, accept from the Secretary of the Treasury the four earliest maturing notes, and pay to the United States the face value thereof, with accrued interest thereon to the date of payment, without recourse further than that Speyer & Co. shall, until the delivery of the refunding, bonds as collateral, be entitled to share pro rata with the United

States in the lien and all proceeds of the lien in favor of the United States to secure said indebtedness.

The said agreement was submitted in writing to the President and approved by him on the 15th day of February, and the said promissory notes have been duly delivered to the Treasurer of the United States.

Other provisions and particulars of said agreement will appear by a perusal thereof, to which reference is respectfully made.

The execution of the agreement was duly authorized by resolution of the board of directors of the Central Pacific Railroad Company, and approved by the formal action and consent of a large majority of the stockholders.

The commissioners have not found it necessary to expend any part of the sum of $20,000 appropriated for the expenses of the commission.

LYMAN J. GAGE,

Secretary of the Treasury. CORNELIUS N. BLISS,

Secretary of the Interior.

JOHN W. GRIGGS,

Attorney-General.

Agreement made and entered into the first day of February, 1899, by and between the United States of America, acting by Honorable Lyman J. Gage, Secretary of the Treasury, Honorable Cornelius N. Bliss, Secretary of the Interior, and Honorable John W. Griggs, Attorney-General, appointed by act of Congress approved July 7, 1898, a commission with full power to settle the indebtedness to the United States growing out of the issue of bonds in aid of the construction of the Central Pacific and Western Pacific bond-aided railroads, of the first part; the Central Pacific Railroad Company, a corporation created, organized, and existing under the laws of the State of California and of the United States of America, of the second part, and Messrs. Speyer & Company, bankers, of the city of New York, of the third part. Whereas the Central Pacific Railroad Company, as now existing, was formed by the successive consolidations hereinafter mentioned, that is to say:

(a) Consolidation of the Central Pacific Railroad Company of California and the Western Pacific Railroad Company into a corporation named the Central Pacific Railroad Company, under articles of association and consolidation dated June 22,

1870.

(b) Consolidation of the last-mentioned Central Pacific Railroad Company, the California and Oregon Railroad Company, the San Francisco, Oakland and Alameda Railroad Company, and the San Joaquin Valley Railroad Company into a corporation named the Central Pacific Railroad Company, under articles of association and consolidation dated August 20, 1870.

And whereas the said Central Pacific Railroad Company, party of the second part hereto, is the owner of the following lines of railroad, with their appurtenances, which are known as and called the "bond-aided lines," viz:

A. The line of railroad (about 737 miles in length), from a point about five miles west of Ogden to Sacramento, to aid in the construction of which bonds were from time to time issued by the United States to the Central Pacific Railroad Company of California to the amount in the aggregate of twenty-five million eight hundred and eighty-five thousand one hundred and twenty dollars ($25,885,120) under and in pursuance of the provisions of the act of Congress of the United States entitled “An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the Government the use of the same for postal, military, and other purposes," approved July 1, 1862, the act to amend the last-mentioned act approved July 2, 1864, and the act to amend the above-mentioned acts approved March 3, 1865.

B. The line of railroad (about 123 miles in length) from Sacramento to San José, to aid in the construction of which bonds were from time to time issued by the United States to the Western Pacific Railroad Company to the amount in the aggregate of one million nine hundred and seventy thousand five hundred and sixty dollars ($1,970,560) under and in pursuance of the provisions of the same acts of Congress under which bonds were issued to the Central Pacific Railroad Company of California, as above stated.

And whereas the said Central Pacific Railroad Company is also the owner of the following lines of railroad in the State of California, with their appurtenances, which are known as and called the "nonbond-aided lines," viz:

C. The line of railroad (about 24 D. The line of railroad (about 146 E. The line of railroad (about 2965 boundary.

miles in length) from Oakland to Niles.

miles in length) from Lathrop to Goshen. miles in length) from Roseville to the Oregon

And whereas the said "bond-aided lines" of railroad are covered by the following mortgages and liens, viz:

First. The bond-aided line from Sacramento to the eastern boundary of California by the first mortgage of the Central Pacific Railroad Company of California to D. O. Mills and William E. Barron, trustees, dated July 25, 1865, under which bonds are now outstanding to the amount, at their face value, of six million three hundred and seventy-eight thousand dollars ($6,378,000), of which bonds to the amount of three million and seven thousand dollars ($3,007,000) are now overdue, and bonds to the amount of three million three hundred and seventy-one thousand dollars ($3,371,000) will mature December 1, 1899.

Second. The bond-aided line from the eastern boundary of California to a point about five miles west of Ogden by the first mortgage of the Central Pacific Railroad Company of California to D. O. Mills and William E. Barron, trustees, dated January 1, 1867, under which bonds are now outstanding to the amount, at their face value, of nineteen million five hundred and three thousand dollars ($19,503,000), of which bonds to the amount of eighty thousand dollars ($80,000) are now overdue, and bonds to the amount of three million nine hundred and eighty-eight thousand dollars ($3,988,000) will mature June 1, 1900, and bonds to the amount of fifteen million four hundred and thirty-five thousand dollars ($15,435,000) will mature June 1, 1901.

Third. The bond-aided line from Sacramento to San José by the first mortgage of the Western Pacific Railroad Company to D. O. Mills and William E. Barron, trustees, dated October 28, 1869, under which bonds are now outstanding to the amount, at their face value, of one million nine hundred and seventy thousand dollars ($1,970,000), and will mature July 1, 1899.

Fourth. The bond-aided line from a point about five miles west of Ogden to Sacramento by the statutory lien in favor of the United States under the acts of Congress approved July 1, 1862, July 2, 1864, and March 3, 1865, above-mentioned, securing the balance of the indebtedness to the United States (amounting as of the date of this agreement to the sum of $53,389,052.74), resulting from the issue of bonds to the Central Pacific Railroad Company of California, as aforesaid, to aid in the construction of said bond-aided line, such statutory lien being by said acts subordinate to the liens of the first mortgages of the Central Pacific Railroad Company of California described in the preceding subdivisions first and second of this recital.

Fifth. The bond-aided line from Sacramento to San Jose by the statutory lien in favor of the United States under the acts of Congress approved July 1, 1862, July 2, 1864, and March 3, 1865, above mentioned, securing the balance of the indebtedness to the United States (amounting, as of the date of this agreement, to the sum of $5,423,662.74) resulting from the issue of bonds to the Western Pacific Railroad Company, as aforesaid, to aid in the construction of said bond-aided line, such statINT 99-MIS, PT 1

-9

« ПретходнаНастави »