Author: William Lee Raymond

Publisher: Theclassics.Us

Published: 2013-09

Total Pages: 126

ISBN-13: 9781230447971

This historic book may have numerous typos and missing text. Purchasers can usually download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1916 edition. Excerpt: ...placed on the property without including the debentures. See Acts 1913, chap. 784, sec. 15, and Acts 1854, chap. 286, sec. 3. 'The title to the equipment rests usually with the_equipment bondholder until the last installment is paid off. The considerations which determine the strength of railroad bonds are considerably different from those applying, .., _, Railroad bonds to government, state, or municipal bonds. The latter payable not 1 Li' 1 c J. 1-M J Irom taxes, but classes are payable out of taxes, whereas railroad from property bonds are payable out of the property or earnings of or eanuns the corporation. In considering the safety of railroad bonds, the vital Leading fac questionsare: --" SOTS? (1) Relation of assets or property to debt.1 road bonds (2) Relation of net earnings to fixed charges. In case of default in interest or principal of mortgage bonds, the bondholders have the right to foreclose on the property, just as the holders of real-estate mortgages have the right in case Remedies for of default to foreclose on the real estate. In the case non-payment of default on plain or debenture bonds, the bondholders have the right to sue at law on the bonds and also on the coupons, but stand on no better footing than other unsecured creditors.2 As far as legal rights go, first-mortgage bondholders have the right to have their entire claim paid from the proceeds of foreclosure sale before anything goes to the holders of second-mortgage or debenture bonds. As a matter of history and practice, however, holders of defaulted first-mortgage bonds often have had, like other bondholders, their claim satisfied in reorganization through the issue of new securities in place of their old bonds. This subject will...