The Railroad Loan.
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We recently published paragraph in relation to a
rumor that four of the Railroad directors had been
paid bonus of $500 each for endorsing the late loan
obtained from the East. In answer to which, we are
favored by the following from Mr.. Merrill. This,
together with private note from Mr.. NJ leads us to
conclude that the affair has not been fully understood
We therefore publish Mr.. Merrilrs explanation with
pleasure. All desire is fair play all round,-for
the public, for the stockholders and for the directors
To the Editors Of The State Sentinel:


In yours of the 18TH is a short article headed
MORE STEALING, in reference 10 which will state the
facts, and you can then judge to the justice of your
remarks.


The State made an offer to the Railroad company
of the use Of the road for seven wears, at a nominal
rent, the condition, that it should be completed to
Indianapolis within three years The company
In debt S2OGOO Its stock had been sold from
one-third to one-half the amount paid, new stock
could not be sold. and no money could be borrowed
except for short periods individual responsibility.
The company having been authorized to pay seven
per cent. for money attempt was made last spring
to borrow, East but State stocks of high character
at the rate could be then had at par pros
poets were gloomy; and had nothing been offered but
the guaranty of the company not dollar would have
been obtained but the assurance that at least four
citizens of the State of undoubted wealth and known
punctualIty, would become personally liable for the
principal anu interest," lDe loan was secured. lDe
object of the guaranty to satisfy the bondholders
that they would not be compelled to resort to the law
to enforce their claims for though the interest of the
company in the road would more than pay the debt
yet moneyed at distance did not wish to be
posed to the risk of burning bridges accidents,
to the delay of litigation the changes in directors
and stockholders, by which they might have much
trouble before their money could be realized.


For this responsibility. indispensable for procuring
the loan, the directors, interested, voted pay
their associates who made the guaranty, per cent
each in stock on the amount of the bonds, being at
the rate Of one-fth of per cent. year. The cost
Of the loan with all the expenses accompanying is at
the rate of eight and one-thrd per cent year This
loan has enabled the company to continue the
of the road. and it will be completed to indianapolis
early in l547. The stock of the company has sold
during the past year double the price of the preced
ing one.


In voting for paying for the guaranty, considered
it like an insurance No loss might be incurred in
which case the premium would be a clear profit; but
in case of bad management of the road serious oc
cidents, the compensation would be totally made.
quite.


There are many other misrepresentation about the
road and its business which have scarcely the time
or patience 10 correct. will however remark, that
the business men along the line who have had goOt
reasons for complaint. the most indulgent to us
As those whose Endorsement would be of no value
complain the loudest that others paid for procur
ing Us loans, those who know nothing of our trou
bles and difficulties, have the most fault to find will
proceedings s. MERRILL.


Railroad Office, Madison, Feb. a. 1916.