Report of the Hoosac Tunnel and Troy and Greenfield Railroad Part 7

_Resolved_, That the direction of the engineering operations within the Hoosac Tunnel after the location of the line is adopted, and plans perfected for the same, be left with the contractor, excepting the measurements for monthly and final estimates and the final acceptance of the work.

1855, July 18. Mr. Serrell having proposed to subscribe the sum of $600,000 (less the amount of the new subscription made by others,) provided the company would make such allowances as would enable him to dispose of the proposed issue of $900,000 of bonds advantageously, the directors voted to add $300,000 to the contract prices of the work, and that said $900,000 bonds as provided by the contract should be issued as soon as authorized by the stockholders, and placed in bank by the trustees to the credit of such persons as shall deposit against the same cash or railroad iron equal in value to sixty-five cents on the dollar.

The said bonds to be taken by said Serrell at par and so estimated in his contract.

At this time sixteen hundred and thirty-five shares of new stock had been subscribed, amounting to $163,500.

The trustees alluded to in the foregoing vote were selected by a committee appointed for the purpose, and with power to execute to them a mortgage. They were J. V. C. Smith, Paul Adams and John G. Davis, all of Boston. The mortgage was executed, and is known in the history of the road as the "Smith mortgage." A resolution explanatory of this transaction was pa.s.sed August 16, 1855, in the following words:--

"_Resolved_, That, whereas by the terms of the provisions of the resolution of July 18, 1855, by which it is provided that the bonds of the company to be issued, are to be placed in bank, &c.; therefore, as explanatory thereto, be it

_Resolved_, That it is not intended thereby to prevent the operation of the contract, but that the said bonds are to be delivered to Serrell & Co., on the warrant of the engineer, countersigned by the president and treasurer, whenever the engineer shall draw therefore on monthly or final estimates."

1856, February 7. The president reported to the directors that a contract had been redrafted and concluded with Messrs. Serrell, Haupt & Co., which was read, accepted and ratified, and the committee discharged. This contract was probably dated January 31, 1856, but the Committee have not been able to find it among the papers of the corporation.

1856, May 22. The directors voted, that in case Messrs. Serrell, Haupt & Co., would enter into an agreement to carry on the work of the Troy and Greenfield Railroad Company, in compliance with the terms and conditions of the loan Act, until 2,000 feet of the tunnel should be completed, the corporation would subst.i.tute bonds instead of stock in all payments to be made on account of work to be done to that time.

The treasurer was authorized to give the acceptance or notes of the company, to an extent equal to the whole indebtedness of the company to said contractors, upon which to raise money to carry on the work.

That the company would pay or allow to said contractors all discounts or losses to which they might be required to submit, provided such discounts or losses did not exceed the rate of 15 per cent. per annum.

That the trustees of the mortgage bonds should deliver to Mr. Herman Haupt one hundred thousand dollars in the bonds of the company in addition to payments due for work, said bonds to be sold or hypothecated by him, and the proceeds applied to the work. The bonds to be charged on account of the contract if not returned when the second payment from the State shall have been made.

1856, July 28. H. Haupt and W. A. Galbraith notified a dissolution of the firm of Serrell, Haupt & Co., and proposed to enter into a new contract.

E. W. Serrell notified that Messrs. Haupt and Galbraith were authorized to surrender the old contract.

The stock subscription of Edward W. Serrell and E. W. Serrell & Co., was transferred to H. Haupt & Co., the latter to furnish a guarantee that the a.s.sessments due and to become due should be paid.

E. W. Serrell resigned his office as a director in the company, and was appointed consulting engineer. W. A. Galbraith was chosen a director.

1865, July 30. A contract was made with Herman Haupt, William A.

Galbraith, C. B. Duncan and Henry Cartwright for the construction of the road and tunnel. The firm name of the contractors was H. Haupt & Co. By the provisions of the contract all work done under previous contracts with E. W. Serrell or Serrell, Haupt & Co., was to be credited to H.

Haupt & Co., and all payments under said contracts were to be charged to H. Haupt & Co., and credited to the Troy and Greenfield Railroad. "The road from the eastern terminus at or near Greenfield from some convenient point on the Vermont and Ma.s.sachusetts line, as the same now is or hereafter be located," is a.s.sumed to be in all about forty-two miles in length.

"This contract includes the graduation, tunneling, masonry and bridging, superstructure, fencing, depot buildings, switches, turn-tables, water and fixtures, and in fine all labor and materials necessary for the construction of the road are included in this contract." The right of way to be provided and paid for by the railroad company. The work to be completed and finished in the best manner, for which the Troy and Greenfield Railroad Company agreed to pay H. Haupt & Co., "the sum of three millions eight hundred and eighty-three thousand dollars in manner following, to wit: Two millions of dollars in the bonds of the State of Ma.s.sachusetts, to be issued under the Act by which the credit of the said State is loaned to said corporation, nine hundred thousand dollars in the six per cent. mortgage bonds of said company, five hundred and ninety-eight thousand dollars in the capital stock of said Troy and Greenfield Railroad Company, and three hundred and eighty-two thousand dollars in cash." The work of constructing and completing the road was to be done in compliance with the loan Act of April, 1854. One hundred and fifty thousand dollars to be expended by the contractors in depot buildings and necessary rolling stock, cars, engines, &c. under the direction of the board of directors. The stock subscription of E. W.

Serrell and of Serrell & Co., amounting to five thousand nine hundred and eighty-seven shares, was to be transferred and a.s.sumed by Haupt & Co., payable in compliance with said Loan Act with the understanding that the a.s.sessments on the stock were to be paid by the performance of this contract in stock credits as provided in the contract, and the stock taken by the contractors at par.

This contract further provided, that on the receipt of the several installments of State bonds, the contractors should pay to the sinking fund the ten per cent. specified in the Loan Act, in consideration of which Haupt & Co. should retain whatever sums was realized from the exchange and premium on the bonds. The payments were to be made monthly, on estimate of the company's engineer. The cost of the materials and work upon the line, exclusive of the Hoosac Tunnel and its approaches, was a.s.sumed to be one million eight hundred and eighty thousand dollars, and the estimates were to be made in the relative proportion that the part done bore "to the whole amount of materials and work to be furnished, and done at the price named." The Hoosac Tunnel and its approaches were estimated at two million dollars for a double track, and the monthly estimates were to be in proportion to the amount of work done on the approaches, and the length of tunnel excavated.

The contract further provided, that, with the a.s.sent of both parties, the tunnel might be constructed for a single track, in which case no abatement was to be made for the first three thousand feet; but for the excavation beyond that point, the sum of twelve dollars per lineal foot was to be deducted from the contract price.

The above are the essential provisions of the contract under which H.

Haupt & Co. performed their work upon the road and tunnel until February 18, 1858, except as the same was modified and changed by votes of the directors. The contract was reported to the board of directors, and approved by them August 6, 1856. On the same day the directors voted to request the trustees to recognize H. Haupt & Co. as contractors, instead of E. W. Serrell, and to issue the bonds to said H. Haupt & Co. on the estimate of the engineer and the order of the trustees.

They also voted to change the location of the road at the West End, in accordance with plans marked A and B.

Under date of July 10, 1857, there appears upon the records the following:--

A preamble, "stating that the efforts to raise money for building the road had proved unsuccessful; that no payments had been made the contractors for more than a year, * * * *; that the work could only be carried on by the continued efforts * * * * and personal credit of the contractors.

"Therefore voted, that the whole of the State bonds that may be issued in aid of the Troy and Greenfield Railroad Company shall be exclusively appropriated to work done, or to be done, upon the tunnel, in compliance with the terms and conditions of the Act authorizing the loan of credit, and with such other conditions and modifications as the legislature may, from time to time, make and establish; but said H. Haupt & Co. shall not be held subject to any other conditions whatever, so far as respects the work done upon the tunnel; and any State scrip that may at any time be delivered to the treasurer of the company, shall be promptly handed to the contractors; the contractors, on their part, to comply with the conditions of the present Act, and with such other conditions or modifications as may be introduced, and to have the benefit of any extension of time or increase of compensation by the State.

Second. Any new or additional subscription that may be obtained, shall be applied to payment of the present contractors for work done, or to be done, by them, and to no other object; and any subscriptions that may be collected west of the Hoosac Mountain, shall be applied exclusively to the completion of that portion of the road.

Third. The present subscription east of the Hoosac Mountain may be collected and applied to the payment of other liabilities of the corporation, and the treasurer is requested to prepare, without delay, a full and complete list of all such liabilities.

Fourth. Any commissions for procuring or collecting subscriptions shall be paid by H. Haupt & Co., in consideration of which, and also of the premises, the payment of graduation, masonry, bridging, and superstructure on the road, exclusive of the tunnel, shall be two million dollars, with the addition of such sums as may be required for the right of way, if this item shall be paid by the contractors. Of this amount, nine hundred thousand dollars shall be in mortgage bonds of the company, and the balance in cash, to as great an extent as can be procured, the remainder in stock at par; and the directors of the Troy and Greenfield Railroad Company shall use their best endeavors to increase the cash subscriptions as much as possible.

If new parties be introduced, or desired by H. Haupt & Co., the contract may be redrafted, and these conditions and changes incorporated; the committee for this purpose shall consist of the president and Alvah Crocker, with power to execute it finally, if not inconsistent with the present contract, or with the changes hereby authorized. It is further agreed and understood, that nothing herein contained shall be so constrained as to invalidate the existing contract with said Haupt & Co., or vary its conditions, except so far as herein expressed or necessarily implied."

On the 18th of February, 1858, another agreement was made by Herman Haupt and Henry Cartwright with the Troy and Greenfield Railroad Company, and such others as might be a.s.sociated with them; and who upon signing the contract were to be considered as parties to the same; as it bears the signatures of D. N. Carpenter, President for the Troy and Greenfield Railroad Company, and H. Haupt & Co., by H. Haupt, and no others, it may be presumed that Messrs. Haupt and Cartwright are the only persons comprising the party of the first part.

This contract recites that every attempt to procure new or to collect old subscriptions to the capital stock of the company, since the execution of the former contract with H. Haupt & Co., have proved unsuccessful; that the contractors had prosecuted the work for more than two years without any payment having been made to them as required by existing contract; that there appeared no possibility of procuring means for the further prosecution of the work, except by the continued efforts, increased expenditures, and personal credit of the contractors themselves; and that H. Haupt & Co. propose to release the Troy and Greenfield Railroad Company from the cash payments required by the contract, and to a.s.sume themselves the labor of procuring and collecting subscriptions, and of carrying on and completing the Troy and Greenfield Railroad and Hoosac Tunnel in such manner as will comply with all the conditions of the Loan Act. The parties therefore agreed.

That H. Haupt & Co. should comply with all the conditions of the Act, approved April 5th, 1854, whereby a loan of credit was given by the State of Ma.s.sachusetts in aid of the construction of the Hoosac Tunnel, and should have the benefit of any changes that may hereafter be obtained, or extensions of time that may be granted; but they shall be subject to no other conditions or restrictions other than those expressed in this contract.

That the road shall be so constructed that its gradients should not exceed those in each direction which exist or may hereafter exist permanently on other portions of the line between Troy and Boston; that sharper curves than were in ordinary use in other parts of the line were to be changed at the expense of the contractors, and trestle work or temporary bridging was to be replaced by permanent structures at the expense of the contractors as soon as practicable after the completion and opening of the whole line.

That H. Haupt & Co. should have the benefit of all existing subscriptions, and of all they might procure; also of any revenue that might arise from the use of the road, or any portion of it when completed, until their claims on the company were discharged and paid; and to secure this end, the payment of all other debts of the corporation was to be deferred until that of the contractors was satisfied. The real estate of the corporation not required for the purposes and use of the road, was to be sold or applied to meet present liabilities of the company; and Haupt & Co. were to maintain the organization of the corporation and pay its necessary printing expenses, by paying to the treasurer annually a sum not less than five hundred dollars.

The State bonds were to be appropriated exclusively to the construction of the tunnel. The State scrip delivered to the treasurer of the company was to be promptly handed to the contractors.

The compensation to be allowed to H. Haupt & Co. was to be as provided in the resolutions of the directors, pa.s.sed July 10, 1857.

The payment for graduation, bridging, masonry, and superstructure on the road, exclusive of the tunnel, was fixed at two million dollars, exclusive of any payments that might be made for the right of way. Of this amount, nine hundred thousand dollars was to be paid in mortgage bonds of the company; the balance in cash, to as great an extent as cash subscriptions could be secured; the remainder in stock at par.

The bonds and stock of the company to be issued to H. Haupt & Co. when required, to an amount equal to the work done, estimating it by the proportion it bore to the whole amount performed and to be performed.

H. Haupt & Co. were authorized to collect subscriptions to the capital stock of the company, and their receipt for money was to be accepted by the company as evidence of payment. By the execution of this agreement all former contracts between the same parties were agreed to be annulled and cancelled.

H. Haupt & Co. was recognized as the firm name under which the parties of the first part were a.s.sociated, and then to be conducted. Copies of this and the preceding contract will be found printed verbatim in a report of a committee of the House of Representatives in 1860, of which Mr. Kimball, of Boston, was chairman. It was reprinted in 1861, and is House doc.u.ment No. 406, of last year; and it may be profitably consulted for other valuable information touching the doings of the Troy and Greenfield Corporation and the contractors therewith.

1858, May 25, the directors a.s.sented that the iron delivered by the Rensselaer Iron Company for the road should remain the property of the iron company until the same was paid for, in accordance with an agreement of H. Haupt & Co. with the iron company.

From a report of a committee of the directors made to the board July 23, 1858, it appears that at the date of the report, seven thousand four hundred and fifteen, shares were subscribed for unconditionally by parties who appeared to have been solvent at the time of subscribing.

That three thousand four hundred and fifty shares had been subscribed for conditionally, or, by parties who were not solvent, or whose subscriptions could not be collected.

That of the conditional subscriptions, the greater part had been or would be complied with; of these nine hundred and thirty-nine were subscribed by the towns not included in the published lists.

Upon two thousand four hundred and thirty shares of the unconditional subscriptions, including those of Gilmore and Carpenter, twenty per cent. only had been paid.

That upon six thousand five hundred and nine shares, subscribed for unconditionally, twenty per cent. or more had been paid in cash.

At this date it appears that the whole number of shares subscribed for conditionally and unconditionally, was ten thousand eight hundred and sixty-five.

At this meeting of the board the clerk was directed to place upon the record the names of all the stockholders, with the number of shares held by each, on which twenty per cent. or more had been paid. The record shows the number of shares to be six thousand six hundred and forty-eight, and the amount paid on the same two hundred and sixty-seven thousand five hundred and sixty-nine dollars. Against the name of H.

Haupt & Co. was set the number of five thousand shares. At this meeting the directors also voted to fix the capital stock at one million five hundred thousand dollars.