compliance with these conditions and the completion of fifty miles of road, one fourth of the donated lands was to be held free of incumbrance and disposable by the company for its general exigencies and the remaining three-fourths were to be retained by the trustees as securities for the payment of bonds which the Company was authorized to issue. The trustees were to sell the last named bonds either for cash or in exchange for the bonds, the payment of which was intended to be thus secured, and if in cash the same to be invested in the bonds, which on receipt were to be cancelled. The charter also provided for the exemption of the Company's property from local taxation; but required for this privilege a payment to the State 7 per centum of the gross receipts of the road when in operation. The main line of the road as defined by the charter extends through the whole length of the State north and south. The Chicago Branch leaves the main line at Centralia and extends northwesterly to Lake Michigan. The aggregate length of both lines is about 708 miles. The Company was organized, March 10, 1851. The first engineering party organized May 21st following and soon after commenced the preliminary survey of the Chicago Branch, and by mid-summer seven other parties had been organized, and were in the field; and before the end of the year the whole line had been surveyed and located. The first contract for graduation was made, March 15, 1852, for that portion of the branch between Chicago and Calumet, 14 miles. This was hurried through for the purpose of allowing the Michigan Central Railroad to enter the city, and was completed May 15, of the same year. Public contracts were first made in June, 1852, when the grading of six divisions of the road was let, and on October 14, following the remaining six divisions were put in hand. The work was carried on with such vigor that both the main line and branch were completed and brought into operation within the next four years, having been opened in sections as follows: Chicago to Calumet.....14 miles, May 15, 1852 Warren to Scales Mound.14 miles, La Salle to Bloomington.60 Sept.11, 1854 .22 20 16, 1853 Clinton to Decatur......2! Oct. 18, 1851 66 Oct. 30, 1854 66 Nov. 22, 1854 17 66 June 12, 1855 ..44 June 25, 1855 Sept. 27, 1856 The several series of bonds issued by the Company for construction and other purposes may be described as follows: Construction Bonds....... .$17,000,000 of which were 7 per cents $12,885,000, and per cents $4,115,000. These bonds bear date April 1, 1851 and are payable April 1, 1875; coupons semi-annually April 1 and October 1-the 7's at New York, and the 6's at London. This issue provided the means for constructing the road. They are secured by a mortgage covering the company's road and franchises and 2,000,000 acres of land, and all sales of these lands are to be applied to their redemption, which may be made at any time, the Company paying 20 per cent. additional on the original amount. The company have also superadded to the security above named 250,000 acres of land not included in the two million aforesaid and the net earnings of the road. Of the total amount $7,266,500 have already been redeemed and cancelled. Free land Bonds, 7's....... .$3,000,000 -dated Sept. 1; 1854, and payable Sept. 1, 1860; coupons semi-annually March 1 and Sept. 1 at New York. These bonds were issued to complete the work, the original estimates having been exceeded. They were secured on 345,000 acres without encumbrance (hence their title). The whole issued was redeemed before maturity. -dated Feb. 20. 1858, and payable 1868; coupons semi-annually, Jan. 1 and July 1, at New York. All except $32,000 have already been converted or otherwise retired Debenture Bonds, 7's.............. ..$970,000 -dated July 1, 1859, and payable 1861; interest Jan. 1 and July 1, at New York. These were temporary loans and have all been retired. Eight per cent bonds..... .$500,000 -dated March 1, 1860 and payable 1865; coupons March 1 and Sept. 1 at New York. These bonds were issued for the payment of such Free Land Bonds as were not paid in upon stock at maturity. The amount issued was $332,100, all of which but $3,000 have been retired by conversion into stock. Redemption Bonds, 6's........ .$2,563,000 -dated April 1, 1865, and payable 1890; coupons April 1, and October 1, at New York. Exchanged for construction bonds. The yearly condition of the above debt is shown in a special table. The result is that it has been reduced from $18,008,650 in 1857 to $12,331,300 at the close of 1865. The stock in the meantime has been increased from $6,556,435 to $23,374 400 partly by conversion, partly by stock dividends, and pa tly by instalments of the original subscriptions. The amount expended in constructing and equipping the road has been $30,519,844, The Illinois Central Railroad Company has been one of the most successful of the land-grant companies. It constructed the longest continuous line of railroad in the Northern States through an almost unpeopled country. In ten years thereafter a large population covered the land for many miles on each side of the road, and by their persistent industry the country has become so productive as to support the road with an affluent commerce and the land-grant has become so productive as to promise to do much more than extinguish the debt incurred in construction, &c. The amount of land already sold is 1,599,564 acres for $18,191,362 of which $2,844,730 was paid in cash and the remainder in notes. Of these notes $8,785,035 are still outstanding and there is still remaining of the original grants 998,069 acres of the present value of $8,772,264. These assets are ample to retire the debt, and when so retired the stock alone will have to be provided for from the annual earnings. This at the present day is worth more than 120-what will be its value when the Company is clear of its funded incumbrances. The future of the Company, indeed, is magnificent. With an ever increasing population and production along its route the commerce of the oad is increasing wonderfully, and requires continued increase of equipment to accommodate its wants. In the ten years ending with 1865 the number of engines and cars has been doubled. In ten other years another duplication will have been made, and this probubly without any large increase in the capital account. Should such be the actual result the increase must benefit alike the settler and the stockholder ―the former by making high rates for travel and freight unnecessary, and the latter by enhancing the value of the stock held. PITTSBURG, FORT WAYNE, AND CHICAGO RAILWAY. The Pittsburg, Fort Wayne and Chicago Railway Company is a consolidation of three separate companies whose conjoint line extends from Pittsburg, Pennsylvania, to Chicago, Illinois. These were the Pennsylvania and Ohio, the Ohio and Indiana, and the Fort Wayne and Chicago. The Ohio and Pennsylvania Railroad Company was chartered in Ohio February 14 and in Pennsylvania April 11, 1848; construction was commenced July 4, 1849, and the road completed in sections as follows: from Pittsburg to Rochester July 30, to Clark's Summit, October 22, to Enon Valley November 19 and to Palestine December 8, 1851; to Columbiana January 3, to Alliance (13 miles of which had been opened March 27, 1851) January 6, to Massillon March 11, and to Wooster August 10, 1852; to Mansfield April 8, and to Crestline April 11, 1953. As auth rized by its charter this company had the right to construct a road to the Indiana line, but the company determined to stop at the last named point, Crestline, and the remainder of the road in Ohio was built by the Ohio and Indiana Company. The total length of the road belonging to this company was 187 miles, of which 49 miles were in Pennsylvania. The Ohio and Indiana Railroad Company was chartered in Ohio, Marce 28, 1850, and in Indiana January 15, 1851, and the company organized July 4, 1851. The road was placed under contract January 28, 1862, and construction commenced in the early spring; and the road completed in sections as follows: from Crestline to Forest January 18, to Delphos June 10, and to Fort Wayne November 1, 1854. Length 138 miles-in Ohio 1124, and in Indiana 19 miles. The Fort Wayne and Chicago Railroad Company was chartered in Illinois February 5 and in Indiana April 8, 1853, and construction commenced in the summer of the same year. The section from Fort Wayne to Columbia, 20 miles, was opened January 23, 1855. Work between Columbia and Plymouth was being prosecuted at the date of the consolidation, but all beyond Plymouth west had been suspended since July 1, 1854. The road was finally completed to Chicago January 1, 1859. Length 147 miles-iu Indiana 134, and in Illinois 13 miles. At consolidation the financial condition of the several companies was as follows: In the process of consolidation the stocks of the several companies were equalized by adding 20 per cent. to that of the Pennsylvania and Ohio, and 6 per cent to that of the Fort Wayne and Chicago. Protests against the consolidation were made by several stockholders of the Pennsylvania Railroad whose stocks, to the amount of $125,350, were paid in cash at par, thereby saving the 20 per cent. proferred by the consolidated company on exchange. The Fort Wayne Company had assets besides what were represented in the work done, amounting to $1,430,000, which passed to the consolidated company. At that time the number of locomotives and cars constituting the rolling stock of the several roads was as follows: The consolidation of these companies was authorized by the Legislatures of the four States which the line of road traversed, viz.: of Pennsylvania April 16, 1856: of Ohio and Indiana by their general laws, and of Illinois February 28, 1856. The articles of consolidation dated May 6, 1856, were agreed to by the Pennsylvania and Ohio company June 2, by the Ohio and Indiana company June 24, and by the Fort Wayne and Chicago company June 12, of the same year; and the consolidation was perfected August 1, 1856, on which day the new company assumed possession of the joint property. At the date of consolidation the road was in operation from Alleghany City, Pa., to Columbia, Ind.-338 miles. It was opened to Plymouth November 29, 1856, and to Chicago, January 1, 1859. The bridge over the Alleghany River was completed and, for the first time, trains entered the city of Pittsburg September 27, 1857. The consolidation secured but one division of its intended purposes-it secured unity of action over the whole line, and thereby reduced expenses. It failed, however to secure the means for the completion of the road, and its appropriate equipment. To forward its plans the company executed a general mortgage of their entire property, January 1, 1857, subject to existing mortgages, for $10,000,000 in 7 per cent. bonds; of this amount $3,500,000 were termed construction bonds, and were set aside for the purpose of completing the road into Chicago; and $6,500,000 were termed redemption bonds, and set aside as a timely provision by sale or exchange for the redemption of the current debt. Financial embarrassments, however, had attended the company from the outset and led to various expedients for relief. The coupons due in October, 1857 were not paid, and in the following month the company suspended payment on their flating liabilities. To relieve the position, and to allow the earnings to be applied to the discharge of current liabilities, the bondholders consented to fund the coupons falling due to April, 1859, into 10 per cent five year bonds, dated April 1, 1858; this scheme was only partially carried ot, and default was again made on the interest falling due July 1, 1859. Under these circumstances the road was placed in the hands of a receiver, excepting that portion lying in Pennsylvania which had previously been placed in the hands of a sequestrator on the suits of local creditors. The relief sought by these measures was not attained, and it was soon see that temporizing would only hasten the impending ruin; to meet these circumstances a plan of reorganization was proposed and adopted by the several parties in interest; this plan provided for the sale of the property and the formation of a new company for which the proper legislation was procured, and to which the road, &c., was to be conveyed by the purchasing trustees, and the several kinds of indebtedness or liabilities of the three original companies to be funded anew. The property was sold and purchased October 24, 1861. and subsequently conveyed to the re organized company on the basis of its present constitution. The capital stock was fixed at $6,500,000 and could only be increased by permission of the bondholders; this was obtained in 1864 (April 7), the issue for 1864 being limited to $3,500,000; the new stock to be applied to construction and equipment. The war eucceeding on the reorganization of the company with its increased travel and traffic brought immediate prosperity to the company. Not only has the company been enabled thereby to pay its coupons regularly, but also to distribute, for the past two years, quarterly dividends of 23 per cent; But for this turn in the aspect of affairs it is scarcely probable that the replacing of the capital invested in the property could have saved the company from final bankruptcy; thus, war has its compensations as well as its drawbacks, and few other railroads have been better compensated by it than has the Pittsburg, Fort Wayne and Chicago Railway. Nearly seven and a half millions have been expended on it since reorganization and of this amount one-half has been from net earnings after paying coupons and dividends in full. CHICAGO AND ROCK ISLAND RAILROAD. The history of this company, brought down to the close of the fiscal year, 1864-5, appears in the last volume of this magazine. The history of the year 1865-6 shows a liberal continuation of the improvements and of the increase of rolling stock, which has been so conspicuous during the last few years. This year is also signalised by the contracts made with the Mississippi and Miss uri Railroad Company for the immediate management of their property by the Rock Island Company and the conditional sale and purchase of the same. These two contracts are dated November 1, 1865, and when consummated and the projects completed, will give this company a continuous line of railroad from Chicago to the Missouri River, with branch from the main line to Washington, Io. The cost of the Iowa works to the company, as they now stand, is fixed at $5,000,000, which is to be paid in 25 years bonds bearing interest at 7 per cent. The total of such bonds to be issued is $9,000,000. the remainder, after the above is paid, being destined: to complete the road to Des Moines, $1,500,000; to pay off the present mortgage of the Chicago and Rock Island Company, $1,400,000; and, to pay off the bonds of the Mississippi River Bridge, $600,000. These arrangements were carried out under a decree obtained from the United States District Court at Des Moines, May 12, 1866, which ordered the property of the Mississippi and Missouri Company to be sold at Davenport on June 25 ensuing. The decree forecloses all the mortgages on the road, viz: the first and second mortgages on the first division from Davenport to Iowa City; the first mortgage on the Oskaloosa branch from Muscatine to Washington and the West; and the second land grant mortgage covering the whole road The Court found that there was due upon the several mortgages $7,482,545 34, and entered a decree for that amount. The sum at which the property is to be purchased, as above stated, is $5,500,000, which is to be distributed as follows: First Mortgage, First Division, and the income bonds given for interest on that mortga e and interest to July 1, 1865........ Second Mortgage, First Division... par 80 per cent Oskaloosa Mortgage, including income bonds given for interest on that mortgage. 62 per cent Stock.. 70 per cent 30 16 per cent per cent These distributions and the expenses of foreclosure will absorb the entire amount of $5,500,000. The Chicago and Rock Island Company, on taking possession, will proceed to extend the road westward to Des Moines and ultimately to the Missouri. |