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Stock and bonds. September 5, 1902, the Railroad Commission approved the Company's increase of capital stock from $25,000,000 to $35,000,000.

May 1, 1905, the Company executed to the Windsor Trust Company as trustee, four per cent, three-year notes aggregating $15,000,000, due May 1, 1908.

March 1, 1907, the Company executed to the Morton Trust Company as trustee, three-year five per cent notes aggregating $10,000,000, due March 1, 1910.

November 1, 1907, the Company executed to the Morton Trust Company as trustee, a mortgage to guarantee the payment of five per cent bonds for $55,000,000, payable November 1, 1952. The preamble of this mortgage recites that provisions are to be made for the payment of two issues of notes, above described.

April 23, 1908, the Public Service Commission for the first district approved the execution of the mortgage to the Morton Trust Company for $55,000,000, and authorized the immediate issue of $30,000,000 of bonds thereunder as well as an issue of three-year notes for $25,000,000. The bonds were to be pledged as collateral security to guarantee the payment of the notes. The notes were to be nised for the following purposes: to discharge the four per cent three year notes for $15,000,000, due May 1, 1908, issued under trust agreement with the Windsor Trust Company as trustee, and notes outstanding April 1, 1908, for $6,250,172.55, payable on demand or from time to time on or before June 30, 1908. The balance to be derived from the issue of notes for $25,000,000 was to be used to pay the obligation incurred in the acquisition of property or construction or maintenance of the Company's road, including about $3,770,000 payable to the Rapid Transit Subway Construction Company on the completion of the Brooklyn extension of the rapid transit railway.

May 1, 1908, the Company executed to the Morton Trust Comipany by collateral trust agreement, six per cent notes for $25,000,000, due May 1, 1911. The preamble of this agreement recites that provisions are to be made for the payment of the issue of $15.000,000 notes, and to discharge other indebtedness to the amount of $10,000,000 expended for improvements on the rapid transit railway.

In 1909, the Company issued additional bonds for $10,000,000 to discharge the five per cent notes executed to the Morton Trust Company as trustee, on March 1, 1907. This issue of bonds was effected without the separate order of the Commission, and in accordance with the terms of the mortgage which the Commission had approved.

February 23, 1912, the Commission authorized the Company to issue additional bonds under the mortgage for $7,254,200. These bonds, together with bonds for $5,500,800, which had been released to the Company by the deposit of money to pay off the balance of the six per cent notes, dated May 1, 1908, were to be used toward discharging $10,000,000 of one-year four and one half per cent notes, dated April 29, 1911,

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It appears that the bonds for $3,947,200 had been cancelled by the refunding of six per cent notes, so that there were outstanding bonds after the issue under the order, amounting to $43,277,000.

After the execution of the contract for the operation of its part of the dual system, March 19, 1913, the Company executed a first refunding mortgage, dated March 20, 1913, to the Guaranty Trust Company of New York as trustee, to guarantee the payment of five per cent bonds for $300,000,000 payable January 1, 1966, and redeemable at any time at 110 per cent of the face value. On the same day, the Commission authorized the issue of bonds under the mortgage for $160,957,000, of which $34,540,800 is to be used to discharge the bonds outstanding under the mortgage of November 1, 1907, and $15,000,000 to discharge renewal notes, dated January 29, 1913, and due May 1, 1913. The rest of the money is to be used for construction of the new lines under Contract No. 3, and of the extensions and third tracking under the certificates.

Intercorporate relations. (See also chart II, no. 6.)

Assignment of contracts Nos. 1 and 2. July 10, 1902, J. B. McDonald assigned the contract for the operation of the subway under Contract No. 1, to the Company.

August 10, 1905, the Rapid Transit Subway Construction Company assigned the operation of the extensions constructed under Contract No. 2, to the Company.

Stock control of other companies. September 1, 1902, this Company acquired the entire capital stock of the Rapid Transit Subway Construction Company, which built that portion of the subway from the City Hall under the East river to Atlantic avenue, Brooklyn.

March 14, 1902, this Company acquired from August Belmont and Company a majority of the shares of the capital stock of the City Island Railroad Company and the Pelham Park Railroad Company. The stock of these two companies was transferred to the Monorail Construction Company about December 1, 1908.

About 1902, this Company acquired substantially the entire capital stock of The New York and Long Island Railroad Company, organized to build the so-called Steinway tunnel under the East river.

About January 1, 1905, this Company acquired a controlling interest in the stock of the New York City Interborough Railway Company, organized to construct and operate street surface railway lines, principally in the Bronx, as feeders for the subway. This stock was sold about 1911 to Frederick W. Whitridge, who purchased in the interest of the Third Avenue Railway system, of which he was receiver.

In 1905, or 1906, this Company acquired the entire capital stock of the New York and Queens County Railway Company, which operates street surface railways in Queens County. This Company

also acquired about the same time a half interest in the capital stock of The New York and Long Island Traction Company and the Long Island Electric Railway Company, the other half being held by The Long Island Railroad Company. These two companies operate street surface railways in the borough of Queens, and the latter also operates in Nassau County.

January 14, 1906, the Interborough-Metropolitan Company was incorporated as a holding company to acquire the capital stock of

the Interborough Rapid Transit Company, the Manhattan Street Railway Company and the Manhattan Securities Company. Up to December 31, 1907, $33,912,098 out of the $35,000,000 capital stock of the Interborough Rapid Transit Company had been acquired by the Interborough-Metropolitan Company, having been paid for at the rate of $200 of Interborough-Metropolitan bonds and $99 of Interborough-Metropolitan common stock for each $100 share of Interborough Rapid Transit stock.

Lease of Manhattan Elevated Railroad. January 1, 1903, the Company took a lease from the Manhattan Railway Company of all its elevated lines for a period of 999 years. The Company agreed to pay as rental on all the outstanding capital stock of the Manhattan Railway Company (amounting to $60,000,000), dividends of six per cent until January 1, 1906, and seven per cent thereafter; also the interest on the outstanding debenture bonds of the merged New York Elevated Railroad Company amounting to $1,000,000; the interest on the first mortgage bonds of the merged Metropolitan Elevated Railway Company amounting to $10,818,000, and the interest on the consolidated mortgage four per cent bonds of the Manhattan Railway Company amounting to $28,065,000. The Company also agreed to pay the taxes, assessments and other governmental charges levied against the Manhattan Railway Company. The lessor company agreed to issue on or after July 1, 1908, at the request of the lessee a new series of bonds bearing four per cent interest, to the amount of $5,409,000 secured by a mortgage, either on a portion or on the whole of its road. The lessor company agreed to maintain its corporate existence and perform all acts necessary to obtain the right to construct extensions, additional tracks, etc., but the expense incurred in such performance was to be paid by the Company. It appears that the Company allowed the Manhattan Railway Company, for the purpose of meeting such expenditures, $10,000 a year.

March 15, 1913, a modification of the lease was agreed to between the companies with a view of enabling the Company to accept the certificates from the Public Service Commission for the construction of extensions to and additional tracks on the existing elevated railroads. The Manhattan Company agreed to issue four per cent bonds for $5,409,000 under the second mort

gage, which were to be issued under the lease. The Company agreed to pay to the lessor company, in addition to the $10,000 allowed it annually to cover administration expenses, the sum of $25,000 per annum for a period of 20 years, commencing March 14, 1913, and to continue such additional payment thereafter unless the lessor company should request that such payment be increased; in that event the matter was to be arbitrated.

Trackage agreements with New York Municipal Railway Corporation. March 19, 1913, simultaneously with the execution of Contract No. 3, a supplementary agreement was executed between the City, the New York Municipal Railway Corporation and the Company for trackage rights on portions of the Steinway Tunnel route as described above under Contract No. 3.

Electric power contract. December 20, 1911, the Company agreed to give The New York Central and Hudson River Railroad Company breakdown power service, by holding at the disposition of the Central company a capacity of not less than 4,000 kilowatts of electrical energy to be furnished when necessary at the Company's manhole, at the northeast comer of 54th street and Park avenue, in the form of three phase alternating current. The Central company agreed to install and maintain at its own expense ducts and two cables between its subdivision no. 1, and the Company's manhole at 54th street and Park avenue, together with the necessary meters. The Company was to receive $2,000 per annum for this reservation and as payment for the first 100,000 kilowatt hours, and two cents per kilowatt hour for all above that amount. The agreement is to continue for five years, and thereafter until terminated by six months' notice by either party to the other.

Transfer agreement and power contract. April 29, 1905, the Company agreed to exchange transfers with the New York City Inter-Borough Railway Company between all the lines operated by the companies for a joint fare of eight cents. The receipts from passengers transferring between the lines of the companies were to be equally divided between them. The Company agreed also to furnish the New York City Inter-Borough Company with electric power for the operation of its lines at the rate of one and three-quarter cents per kilowatt hour, on a basis of a minimum of

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