FIRST MORKîAGE
of thf
New York .
D(k olas Taylor & Co., Printers,
No. 8 Warren Strej-f.
^lïîSi made this first day of April,
in the year one thousand eight hundred and ninety-three,
by and between the Texas Cexteal Railroad Company,
a corporation created, organized and existing under the
Laws of the State of Texas, party of the first part, herein¬
after called the Railroad Company, and the Farmers'
Loan and Trust Company, of the City of New York, a cor¬
poration created, organized and existing under the Laws of
the State of New York, Trustee, party of the second part,
hereinafter called the Trustee, Witnesseth :
Whereas, on or about the 22d day of April, 1891, at
the foreclosure sale of the Texas Central Railway Company,
Charles Moran, Henry K. McHarg and Cornelius B. Gold
became the purchasers of certain railways, property,
rights and franchises formerly of the Texas Central Rail¬
way Company and hereinafter more particularly described ;
and
Whereas, under and in pursuance of the Laws of the
State of Texas, the said Charles Moran, Henry K. McHarg
and Cornelius B. Gold did thereafter cause the said party
of the first part to be organized as a corporation for the
purpose of acquiring, owning, maintaining and operating
(including the power to construct and extend) the railways
hereinafter described and an extension thereof, and did
thereafter convey said railways, property, rights and fran¬
chises, hereinafter described, to the said party of the first
part, which has thus become the owner thereof ; and
Whereas, the Railroad Company, in the exercise of the
powers possessed by it under the Laws of the State of Texas,
and in order to provide for paying and discharging its in¬
debtedness and obligations upon the purchase of such rail-
2
ways, properties, rights and franchises, and to provide for
betterments, extensions and the general purposes of the
Company and in accordance with resolutions duly adopted
by its Board of Directors and by its stockholders at meet¬
ings duly and regularly called and held, has determined
to issue its first mortgage gold bonds to the aggregate
amount of $2,000,000, payable in gold coin of the United
States of America, of the present standard of weight and
fineness, such bonds to be for one thousand dollars each,
payable on the first day of April, 1923, and to bear interest
from the first day of April, 1893, payable semi-annually at
a rate not to exceed six per centum per annum in like gold
coin, on the first days of April and October in each and
every year, redeemable in like gold coin as hereinafter
provided upon any interest day at par and accrued interest,
together with such premium not to exceed ten per cent, as
may be determined by the Board of Directors at the time
of issue thereof ; and
Whereas, the Board of Directors of said Railroad Com¬
pany has duly authorized the issue of said bonds in the
manner hereinafter mentioned and has provided that the
Railroad Company shall duly execute and acknowledge in
duplicate, and cause to be certified so as to entitle the same
to be recorded, and thereafter deliver to the Farmers' Loan
and Trust Company, of the City of New York, as Trustee,
a mortgage or deed of trust in the form hereby named,
bearing date the first day of April, 1893, conveying by way
of mortgage or deed of trust to the said Trustee all of the
railways, rights and franchises, easements, privileges, im
niunities and property of the said Railroad Company of
every name and nature, real, personal or mixed, herein¬
after described, together with all tolls, income, revenues,
rents, issues and profits thereof, and that the several re¬
citals, statements, grants, terms, conditions, contracts, pro¬
visions, stipulations and conveyances herein contained.
3
shall be binding upon the party of the first part thereto,
which mortgage the Railroad Company shall cause to be
recorded in the County of McLennan, State of Texas, and
any other places where it shall be lawful to record the
same; and
Wheeeas, by said resolution of its Board of Directors
said Railroad Company did direct that said bonds and the
coupons attached thereto, with the engraved or lithographed
signature of its Treasurer or Assistant Treasurer and the
Trustee's certificate endorsed upon said bond, should be sub¬
stantially in the words and figures following, and should
be authenticated, issued and secured in the manner herein¬
after stated.
i^Form of Bond.)
No UNITED STATES OF AMERICA. $1,000.
State of Texas.
TEXAS CENTRAL RAILROAD COMPANY.
Fiest Moetgage Bond.
The Texas Central Railroad Company hereby acknowl¬
edges that it is indebted to the Farmers' Loan and Trust
Company, as Trustee, or bearer, in the sum of one thou¬
sand dollars, which sum it promises to pay to said Trustee
or to the holder of this bond on the first day of April,
1923, in gold coin of the United States of America, of
the present standard of weight and fineness, at the finan¬
cial agency of said Railroad Company in the City of New
York, with interest thereon, at the rate of per centum
per annum, payable in like gold coin at the same place
semi-annually on the first days of April and October in
each year, upon the surrender of the annexed coupons as
they successively mature, and so long as the principal
thereof remains unpaid, free from any deduction whatever.
4
If default shall be made in any of the payments of inter¬
est upon this bond, as the same shall respectively become
due and payable, and if the same shall continue for four
months, the principal sum of said bond shall thereupon
become due and payable in the manner and with the effect
specified in the deed of trust hereinafter named.
This bond is one of a series of bonds, all of like amount,
numbered consecutively from 1 to 2,000, issued and to be
issued by the Texas Central Railroad Company, as pro¬
vided in said deed of trust. The payment of said bonds,
with interest thereon, is equally and ratably secured by a
deed of trust or mortgage made by the Texas Central Rail¬
road Company to the Farmers' Loan and Trust Company,
as Trustee, bearing even date herewith, giving to such
Trustee a lien upon the railroads, franchises and corporate
property of the said Railroad Company in the State of
Texas specified in said deed of trust. This bond shall not
become obligatory until authenticated by the certificate of
the Trustee.
This bond may be registered in the owner's name on the
Company's books in the City of New York, such registry
to be noted on the bond by the Company's registration
agent, after which no transfer shall be valid unless made
on the books of the Company by the registered owner or
his attorney and similarly noted on the bond, but the
same may be discharged from registry by being transferred
to bearer, after which it shall be transferable by delivery,
and it may then be registered as before. The registry of
this bond shall not impair the negotiability of the coupons
by delivery merely.
Said Railroad Company shall have the right to redeem
at par with a premium of per cent, and accrued in¬
terest any or all of said bonds on any interest day, upon
payment thereof in like gold coin, at its financial agency
in the City of New York, upon the notice and in the man-
o
ner provided by said mortgage or deed of trust. Said
bonds shall draw no interest after the date fixed for re¬
demption thereof.
Ix WITNESS WHEREOF, the Texas Central Rail¬
road Company has caused these presents to be
signed by its President or Vice-President, and
Secretary or Assistant Secretary, and its corjjo-
rate seal to be hereto affixed, the first day of
April, 1893.
TEXAS CENTRAL RAILROAD COMPANY,
By , President,
, Secretary,
{For7)1 of Coupon,)
UNITED STATES OP AMERICA.
Coupon.
The Texas Central Railroad Company will pay to
bearer, at the financial agency of said Railroad Company
in the City of New York, Dollars
in gold coin of the United States of America, on the first
day of October, 1893, being six months' interest on its
First Mortgage Bond, No
, Treasurer,
{Form of Trustee''s Certificate,)
Trustee's Certificate.
It is hereby certified that this is one of the series of
bonds mentioned in the mortgage therein referred to.
The Farmers' Loan and Trust Company,
Trustee,
By Í , Vice-President,
6
Now, THEREE^ORE, in Consideration of the premises and
of the agreements hereinafter made, and of the sum of
one dollar received by the said Railroad Company from
the said Trustee, and in order to secure the payment of
the principal and interest of all the bonds aforesaid at any
time outstanding, the Railroad Company hereby grants,
bargains, sells, conveys and assigns to said Trustee and its
successor and successors in the Trust hereby created, and
to their assigns forever, all and singular the following
described railroad, franchises, stations, shops, terminal
facilities, rolling stock and equipment, together with all
easements and property, real, personal and mixed, apper¬
taining thereto, and the tolls, rents, issues and profits
thereof, situate, lying and being in the State of Texas,
more particularly described as follows : All and singular
that which was formerly the main line of the Texas Cen¬
tral Railway, beginning at the Town of Ross in McLen¬
nan County, Texas, and extending to Albany in the
County of Shackelford, Texas, together with all side
tracks, turn outs, rolling stock, equipments, materials,
all rights-of-way and tracks, depot and shop grounds,
tenements and hereditaments, rights and franchises, in¬
cluding all the property used for and pertaining to the
operation of said line of railroad, being a portion of the
property conveyed to the Railroad Company by Charles
Moran, Cornelius B. Gold and Henry K. McHarg as Pur¬
chasing Trustees, &c., by deed dated January 23, 1893,
and also the property and property rights and the branch
railroad to the coal fields in Erath County and the exten¬
sions to Waco and through and beyond the Counties of
Shackelford, Jones and Haskell, all of which are men¬
tioned and described in the first article of this instrument
for the building or acquisition of which or in payment for
which any of the bonds secured hereby shall be issued.
To HAVE AND TO HOLD, all Said lailroads and the exten-
7
sions and branch herein described and hereafter to be con¬
structed and the other property in any way belonging or
ap]3ertaining thereto or used thereon unto said Trustee
and its successors and assigns forever, in Trust, never¬
theless, under the provisions hereinafter set forth, for the
benefit of all holders of bonds duly issued under tliis
mortgage, and to insure the payment of the principal and
interest of all such bonds, according to their terms and
the terms of this mortgage, without any preference by
reason of priority in the time of issue or negotiation of
any of said bonds or otherwise, provided, however, that
if the Railroad Company shall pay the jDrincipal and in¬
terest of all of said bonds according to the terms thereof
and of this mortgage and the reasonable compensation and
lawful charges of said Trustee, all of the estate and inter¬
est of said Trustee in said railroads and other property
and all liens thereon hereby created shall cease.
It is agkeed, between the parties hereto and by said
Railroad Company, with all holders of any of the bonds
issued hereunder, that the provisions under which said
bonds are to be issued by said Railroad Company, and the
said mortgaged property and franchises are to be held by
the Trustee, are as follows :
Article I.—Upon the execution from time to time of
said bonds by said Railroad Company and the execution
and delivery of said deed of trust therein named, the
said bonds shall be delivered to the Trustee for the pur¬
pose of enabling the Trustee to sign the certificate endorsed
upon each of the same, and of which a form is given in
the foregoing recitals, and when so certified said bonds
shall be returned to the Railroad Company for issue and
sale, subject, however, to the restrictions and conditions
hereinafter named. The Trustee shall certify said bonds
to be issued only as follows :
8
First.—Bonds not to exceed five linndred in mimber
suificient to provide for the existing liabilities of the
Company, and after said liabilities are fully satisfied,
then to provide for further expenditures for the general
purposes of the Company.
Second.—Bonds not to exceed one hundred and fifty
in number, sufficient to pay the cash cost of steel rails
purchased or to be purchased.
Third.—Bonds not to exceed one hundred and fifty
in number, sufficient to secure to the Company an entrance
into Waco, together with proper terminal facilities.
Fourth.—Bonds not to exceed four hundred and fifty
in number, suificient to pay the cash cost of building and
equipping a branch from some point on the main line be¬
tween Ross and Albany, in the direction of or to and
through coal fields situated in and adjacent to Erath
County, not to exceed $15,000 per mile of completed rail¬
road, exclusive of side tracks.
Fifth.—Bonds not to exceed six hundred in number,
sufficient to pay the cash cost of building and equij)ping
an extension of the main line in a northwesterly direction
«y
about forty miles through and beyond Shackelford, Jones
and Haskell Counties, not to exceed $15,000 per mile of
completed railroad, exclusive of side tracks.
Sixth.—Bonds not to exceed one hundred and fifty in
number, sufficient to pay any excess in the cost of said
steel rails, branch or extensions, over the amount realized
from the sale of bonds to be issued for such purposes as
hereinbefore fixed.
Seventh.—Any bonds hereby secured may be issued to
pay the cost of further extending either of said extensions
9
or said branch, provided that the average limit of $15,000
per mile of completed main track, exclusive of side tracks,
shall not be exceeded ; or, upon filing with the Trustee
the unanimous approval in writing of Amedee D. Moran,
Cornelius B. Gold and Henry K. McHarg, or the surviv¬
ors of them, any part of said bonds, not exceeding five
hundred in number, mav be issued and used in such
7
manner as they may deem expedient, in sufficient amount
to pay the cost of future acquired property or of securing
terminal, trackage or other railway facilities into or be¬
yond the City of Waco, which in their judgment will be
for the benefit and security of the stockholders of said
Company and of the holders of said bonds.
Eighth.—Bonds shall be issued for the amounts and
jmrposes aforesaid, or to the amounts necessary to
the sums due or to become due upon contracts entered
into for the building of said branch and extensions resx)ect-
ively, and expenditures actually incurred thereon, pro¬
vided there shall first have been filed with the Trustee the
written ax)proval in each case of Amedee I). Moran,
Cornelius B. Gold and Henry K. McHarg, or the majority
or the survivors or survivor of them, or the written ap-
x)roval of the holders of four-fifths of said bonds then out
standing, but in case of the 500 bonds mentioned in sub¬
division seventh of this article the unanimous ajjproval in
writing of Amedee D. Moran, Cornelius B. Gold and
Henry K. McHarg, or their survivors, shall be required to
justify the issue.
It is understood that said Amedee D. Moran, Cornelius B.
Gold and Henry K. McHarg shall not be held responsible
for any error in judgment or otherwise in giving or with¬
holding their approval herein mentioned, and that the dis¬
cretion hereby vested in them for such purpose is arbitrary
and absolute.
10
Said bonds shall be engraved, but printed or litho-
grai:)hed certiñcates executed in the same manner as
said bonds and certified by the Trustee to be secured by
this instrument may be temporarily issued in amounts of
one thousand dollars, or multiples thereof, to be thereafter
exchanged for engraved bonds to an equivalent amount,
each of one thousand dollars par value, which certificates
shall have the same force and effect and be secured by this
mortgage in the same manner and to the same extent as
the bonds hereinbefore described, until said certificates
shall be exchanged for said engraved bonds.
The Company shall have the right to redeem said bonds
and each of them according to the terms thereof, t^rovided
a notice of such intention shall be advertised once a week
for four weeks in one or more newspapers published in
the City of New York, and a similar notice shall be given
by mail to the holder of each bond who shall have regis¬
tered his address at the office of the Trustee, and on such
publication and the giving of such notice the said bonds so
to be redeemed shall become due and interest shall cease
thereon on the interest day fixed by said notice, provided
the Company shall have deposited with the Trustee funds
required for such redemption. Bonds redeemed shall be
cancelled by the Trustee.
Ninth.—The Trustee shall certify the issue of bonds only
to the amount and for the purposes hereinbefore stated,
upon presentation of certified copies of resolutions of the
Board of Directors of the Railroad Company making re¬
quest therefor and stating the purposes for which the same
are desired. If desired for the purpose of paying existing
liabilities, or for the x>urchase of steel rails, said resolution
shall be accompanied by the affidavits of the President or
Vice-President and Treasurer or Assistant Treasurer of the
Railroad Company, stating the amount necessary to satisfy
11
said liabilities or to pay tlie cash cost of said steel rails ;
and if desired for the construction of said branch or exten¬
sions or to pay the sums due or to become due upon con¬
tracts or expenditures incurred on account thereof as herein¬
before provided, said resolutions shall be accompanied by
like affidavits, stating the amount of bonds necessary to pay
the cash cost of such branch or extension constructed, or
the amount due or to become due upon said con-
tractsor the amount of said expenditures incurred, and
that after making said payments under said con¬
tracts the construction of such branch or extension can
be completed at a cost not in excess of an average amount
of $15,000 per mile, exclusive of side tracks, including the
amount of said payments, and a similar statement veriñed
by the superintendent or other officer of the Company hav¬
ing knowledge of the facts.
The fíling with the Trustee of the resolutions and affi¬
davits and written approval hereinbefore mentioned shall
be conclusive as to the right of the Trustee to certify and
deliver bonds to the Railroad Company for issue and sale.
Article II.—The Railroad Company shall pay the
principal of said bonds duly issued hereunder accord¬
ing to the terms thereof in gold coin of the United
States of America, of the present standard of weight and
fineness, when the principal shall become, or be declared
due, upon the surrender of the bonds, and shall pay the inter¬
est thereon according to the terms of the bonds and in like
gold coin until the principal is paid, without any deduc¬
tion whatever from principal or interest. As the coupons
annexed to said bonds are paid, they shall be cancelled, and
no purchase of any coupons nor any advance or loan there¬
on nor redemption thereof by or on behalf of said Railroad
Company after the same have been detached from the
12
bonds to which they belong, shall keeji such coupons alive
or preserve their lien upon the mortgaged property.
Article III.—The said Railroad Company hereby cov¬
enants and agrees to and with the said Trustee for the
benefit of the holders of the bonds secured hereby, that
it will pay all lawful taxes and assessments upon said
property hereby mortgaged at any time levied and assessed
thereon. That it will suffer no mechanic's, statutory or
labor lien which shall have priority to this to be created
or placed on any part or portion of its railway or any
part or portion of the estate hereby mortgaged, to the
end that the priority of this Indenture shall at all times
be maintained, and that its successors and assigns shall
and will diligently j)reserve all rights and franchises to it
granted and upon it conferred, and shall and will at all
times maintain, preserve and keep the same and every
part thereof, with the rolling stock, fixtures and appur¬
tenances, and every part and parcel thereof, in good re¬
pair, working order and condition, and supplied with all
th(^. necessary motive power, rolling stock and equipment,
and will, from time to time, make all needful and proper
repairs, renewals and replacements, useful and proper
alterations, additions, betterments and improvements.
Article IV.—The said Railroad Company, for itself
and all other persons claiming through or under it, and
who may at any time hereafter become holders of liens
Junior to that of these presents, hereby expressly waives
and releases the right to have all or any of the estates
comprised in the security intended to be created by these
presents marshalled upon any foreclosure or other enforce
ment thereof, and it is expressly hereby agreed and de¬
clared that the Trustee herein, and any court in which
foreclosure of this mortgage or administration of the
13
Trust hereby created is sought, shall have the right, in its
discretion, to sell the entire property of every description
comprised in or subject to the trusts of these presents
as a whole and in one single lot.
Auticle V.—The said Railroad Company for itself, its
successors and assigns, and so as to bind all persons who
may claim through or under it as assigns, junior encum¬
brances, lien holders or otherwise, does hereby irrevocably
waive the benefit or advantage of any and all valuation,
stay, appraisement, redemption and time extension laws
and all other laws requiring mortgages, liens, hypotheca¬
tions, or any securities for money to be foreclosed by
action therefor now existing, or which may hereafter ex¬
ist, in the State wherein the property to be sold hereunder
may at the time of sale be situated, or where the said
sale may take place, which, but for this provision herein,
might prevent or postpone the sale of the said premises,
property, rights and interest to the purchaser under the
powers and in compliance with the provisions herein pro¬
vided. And the said Railroad Company does hereby cov¬
enant with the said Trustee and its successors that it will
not in any manner set up, seek or take advantage of any
such valuation, stay, appraisement, redemption or exten
sion law.
Akticle VI.—In case default shall be made in the pay¬
ment of either principal or interest of any of the bonds
secured by this mortgage, or in case of non-compliance
by the Railroad Company with any of its agreements
herein set forth, and if the same shall continue for four
months, it shall be lawful, unless such default or non¬
compliance be waived, as herein provided, for the said
Trustee or its successors, by its attorney or attorneys,
agent or agents, to sell and dispose of all and singular
14
the said railroad, appurtenances, property and premises,
rights, interests and franchises hereby mortgaged and
conveyed, or intended so to be, at public auction to the
highest bidder, at such time and place, in the City of
Waco and State of Texas, as it may designate, having
first given public notice of the time, place and the terms
of such sale by advertisement published not less than
three times a week, for eight consecutive weeks, in one or
more newspapers published in the cities of Waco and
New York, with the right to adjourn such sale or sales
from time to time in the discretion of such Trustee, giving
reasonable notice of such adjournment, and after such
adjournment to sell the same at the time and place to
which the sale may be adjourned, and on the consumma¬
tion of the sale upon the terms and conditions thereof,
to make and deliver to the purchaser or pur¬
chasers thereof good and sufficient deed or deeds in
law for the same in fee simple, which sale made
as aforesaid shall be a perpetual bar both at law and
in equity against the Eailroad Company and all other
persons claiming or to claim the said railway and appur¬
tenances, property and premises, rights, interests and
franchises, or any part thereof so sold by, from, through
or under it ; and after deducting from the proceeds of said
sale just allowances for all exi3enses of said sale, including
attorneys' and counsel fees, and all other expenses,
advances and liabilities which may have been made or
incurred by the said Trustee in operating said railways or
in maintaining the same or in managing its business while
in possession thereof, and all payments which have been
made by it for taxes and assessments, and other proper
charges upon the said railways and appurtenances, prop¬
erty and premises, rights, interests and franchises, or any
part thereof, as well as reasonable compensation for its
own services, then to apply the said proceeds to the pay-
15
ment of the principal of such of the aforesaid bonds as
may be at such time unpaid, whether the same shall have
previously become due or not, and of the interest which
shall at that time have accrued uj^on said principal and be
unpaid, without discrimination or preference, but ratably
to the aggregate of said unpaid principal and the accrued
and unpaid interest added together, and after satisfaction
of all said bonds secured hereby, with the interest thereon,
to pay over the surplus of said proceeds, if any, to said party
of the first part, or to such party as may then be entitled
to receive the same. This provision is cumulative to the
ordinary remedy by foreclosure in Courts, and the Trustee
herein, or its successor, upon default being made as afore¬
said, may at its discretion and upon the written request
of the holders of a majority in value of the said bonds then
outstanding and unpaid, and upon being properly indem¬
nified, shall institute proceedings to foreclose this mortgage
or deed of trust in such manner by sale und^r the power
herein given, or by suit as the majority of said bondholders
may direct. And if no such direction is given in this behalf,
then in such manner as the Trustee may deem expedient.
For the debt or bonds secured hereby the railroad com¬
pany is liable in personam^ and any deficit after exhaust¬
ing the mortgage security may be enforced against said
Company or its other proi)erty, but not against the stock¬
holders individually.
0
Auticle VII.—Any declaration, request, appointment
or designation herein provided to be made by owners of
bonds secured by this mortgage shall be by instrument in
writing, and must be signed by the bondholder or his
attorney duly authorized for the purpose, and be proved
by the certificate of a notary public or other officer author¬
ized to take acknowledgments of deeds, that each person
signing the same, acknowledged the execution thereof and
16
made oath before him of the ownership of the bonds.
Fnll power under which an attorney shall sign any such
instrument must be proved by a like certificate as to the
execution thereof, and must be filed with the instrument
so signed. Each such certificate shall be conclusive evi¬
dence of the truth thereof as far as said Trustee is con¬
cerned. Meetings of the owners of bonds secured hereby
for action under provisions of this mortgage may be called
by the Trustee, and shall be called upon request of owners
of not less than one-tenth of the bonds outstanding, who
may themselves call such meeting ux^on failure of the
Trus'tee to comply promptly with such request.
Article VIII.—The Railroad Company shall keep an
agency in the City of New York while said bonds are out¬
standing for the payment of the princqial and interest
thereof, and shall keep at said agency books on which any
of said bonds shall upon request be registered without
expense to the holder. Each registration of the xirincipal
of a bond shall be noted on the bond, after which no
transfer thereof can be made except on said books until
after a registered transfer to bearer, when the x^rincipal of
the bond will become transferable by delivery until again
registered in like manner in the name of the holder.
Article IX.—The Railroad Company, so long as there
is no default in payment of principal or interest of any
of the bonds secured by this mortgage or any of the agree¬
ments of said Railroad Company hereunder, shall have
the possession, operation, management and use of said
railroad and other property and franchises, and receive
the rents, income and profits therefrom as if this mortgage
had not been made.
Article X.—The Railroad Company, so long as there is
no default in the payment of any interest or the principal
17
of any of its bonds secured by this mortgage, or in any of
the agreements herein set forth, shall have the right to
sell or otherwise dispose of, free from any lien created
hereby, any of the outfit, equipment or machinery, which
shall become old, worn out or unfit for use, or which shall
not be required in the operation of the railroad, and also
to sell or otherwise dispose of with like effect, with the
written approval of the Trustee, any other of the property
covered by this mortgage, real or personal, not so required,
and shall apply the proceeds of any sale of property
covered hereby to the replacement of the property sold, or
otherwise for the benefit of the mortgaged property. Any
property substituted or acquired with the proceeds of sale
of property covered by this mortgage shall forthwith be
subject to the terms of this mortgage.
Article XI.—In case of default for four months after
due demand, in the payment of interest on any of the
bonds secured by this mortgage, the principal of all of
said bonds, with all interest accrued and unpaid thereon,
shall become due at the election and upon the declaration
of the owners of one-fourth of said bonds then oustanding
made as hereinafter provided, and filed with the Trustee,
and shall become due upon foreclosure sale of the mort¬
gaged property if the same shall not have previously be¬
come or been declared due. But a majority of the holders
of said bonds may, by an instrument in writing, signed by
such majority and executed according to Article VII. of
this instrument and filed with the Trustee, waive the right
to consider the principal due by reason of such default on
such terms and conditions as such majority shall deem
proper, provided that no such action of the bondholders
shall extend to or affect any subsequent default or impair
the rights resulting therefrom.
18
Aeticle XII.—In case default shall be made in the pay¬
ment of interest on any of the aforesaid bonds, or in case
of non-comx)liance by the Railroad Company with any of
the covenants herein contained, and if the same shall con¬
tinue for the period of four months, it shall be lawful for the
Trustee, and upon the application of the holders of one-fourth
of the amount of said bonds at such time outstanding, the
Trustee or its successors, shall personally or by their attorney
or agents, enter into and upon all and singular the premises
hereby conveyed or intended so to be, and each and every
part thereof, and have, hold and use the same and operate by
their superintendent, manager, receiver or servants, the
said railroad, and conduct the business thereof and exer¬
cise the franchises and privileges appertaining thereto,
and make from time to time all the repairs and replace¬
ments and such useful alterations, improvements and
additions thereto as may seem to be judicious and proper,
and shall receive and collect all rents, issues and profits
of the same and every part thereof, and after deducting
the expenses of operating the said railroad, conducting its
affairs and all payments which may be made for taxes,
assessments, charges and liens which are prior to the lien
of these presents, and just compensation for its own ser¬
vices and the services of attorneys and employees, shall
^pply the moneys arising as aforesaid to the payment of
interest, in the order in which said interest may become
due ratably, to the persons holding the coupons evidencing
the right to said interest. And in case all said payments
shall have been made in full and no sale shall have been
made in conformity hereto, the said Trustee shall restore
the possession of the property hereby conveyed unto the
paiffy of the first part, its successors or assigns, unless the
holders of one-fourth of the bonds then outstanding shall
elect to exercise the rights conferred by Article XIII., and
in the manner therein provided. But if any of the de-
19
faults herein specified be subsequently made, such restora¬
tion shall not, nor shall any previous entry be construed
to exhaust or in any manner impair the powers of sale or
any of the powers hereby granted or conferred upon the
Trustee or its successor in trust. But a majority of the
holders of said bonds may, by an instrument in writing
signed by such majority and executed according to Article
VII. of this instrument and filed with the Trustee, waive
the right conferred in this clause upon said Trustee on
such terms and conditions as such majority shall deem
proper, provided that no such action of bondholders shall
extend to or be taken to affect any subsequent default in
this clause referred to, or to impair the rights resulting
therefrom. It is further agreed, that upon the filing of a
bill in any Court of competent Jurisdiction for the fore¬
closure of this mortgage or deed of trust as herein pro¬
vided, and for the appointment of a Receiver to take pos¬
session of said property and operate it during the pendency
of such foreclosure proceedings, and until a deed shall be
made to the purchaser at a sale made hereunder, upon
proof of default to the Court and an application of the said
Trustee or its successor in trust, the Court shall appoint
the person whom the owners of a majority of the then out¬
standing bonds secured hereby shall designate by written
designation executed as provided in Article VII. of this
mortgage, or in default of such designation, some compe¬
tent person as Receiver, who shall take possession of said
property and operate it under the direction of the Court as
above mentioned, and in case of default as aforesaid and
the appointment of a Receiver, the Court shall proceed to
ascertain as speedily as possible the amount due upon
said bonds and coupons, and order a sale of said property
upon such terms and conditions as to the Court shall seem
Just and right. It is also agreed that this article shall not
impair the rights and powers of the Trustee, or its succès-
20
sors, under any other article, covenant or agreement
herein.
Article XIII.—In case of default for four months
after due demand in the j^ayment of either principal or
interest of any of the bonds secured by this mortgage, or
of non-compliance by the Railroad Company with any of
its agreements herein set forth, the Trustee may begin
foreclosure or any other appropriate proceeding in any
proper Court by way of remedy, as the Trustee, being
advised by Counsel, shall deem most expedient for the
interest of the owners of said bonds. And upon the
request of the owners of one-fourth of the then outstand¬
ing bonds secured hereby, made as hereinafter provided,
and hied with the Trustee, and upon a reasonable indem¬
nity, the Trustee shall proceed to enforce a remedy by
foreclosure or other appropriate proceeding in any proper
Court, according to such request, it being understood
that the right to take proceedings for the foreclosure of
this mortgage, or for the collection of interest or princij)al
of said bonds, is vested exclusively in the Trustee, except
on a refusal of the Trustee to proceed as required within
a reasonable time after such request, and the offer of such
indemnity, subject to the right of the holders of a
majority of said bonds to waive default, as hereinbefore
provided.
Article XIV.—In case of a sale of Wie property and
franchises covered by this mortgage, any purchaser, after
paying in cash enough to cover the costs and expenses of
the sale and any unpaid compensation or charges of the
Trustee and such other charges as the Court having juris¬
diction of the proceedings shall require to be paid in cash,
shall have the right to apply in making pa3^ment any
bonds secured hereby and entitled to share in the net
21
proceeds of such sale, counting each bond at such sum as
shall be payable thereon out of such net proceeds.
Article XV.—The Railroad Company will from time
to time, during the continuance of this trust, make,
execute and deliver all such further instruments and con¬
veyances as may be necessary to vest in said Trustee or
its successor as mortgagee all subsequently acquired
property and extensions constructed, herein mentioned
and described, and will make, execute and deliver all such
further instruments, and will do such further acts as may
be necessary or proper to carry out more effectually the
purpose of this mortgage.
Article XVI.—The Trustee or its successor may resign
the trust hereby created by giving at least three months'
notice in writing to said Railroad Company of its inten¬
tion so to resign. The said Trustee may also be removed
from office by a vote of a majority in interest of the hold¬
ers of the bonds secured hereby, the said vote being had
at a meeting duly held by said bondholders and verified
by an instrument under the hands of the persons so voting,
and also a verification proving the right of said persons to
vote. Or the said Trustee may be removed, and any
vacancy in the office of Trustee may be filled, by an
instrument in writing duty executed and acknowledged
by a majority in interest of the holders of the then out¬
standing bonds secured hereby, or their attorneys, in con¬
formity with the provisions of Article VII. of this instru¬
ment. Upon appointment of a new Trustee as herein
provided, the said Trustee so appointed shall thereupon
become vested with all the powers, authorities and estates
granted to, or conferred upon, the Trustee by these pres¬
ents, and all rights and interests requisite to enable the
Trustee so appointed to execute the purposes of this trust
22
without any further assurance or conveyance. I]j)on the
resignation or removal of said Trustee, or any appointment
in its place, all the powers and authority by virtue hereof
shall cease, and all the estate, right, title and interest in
the premises of such Trustee shall wholly cease and deter¬
mine, and such Trustee shall, if requested in writing by
the new Trustee, immediately execute a deed or deeds of
conveyance to vest in such new Trustee upon the trust
herein expressed, all the property, rights and franchises
which may be at that time held uj)on said trust.
Article XVII.—The right of action under this Inden¬
ture is vested exclusively in the Trustee, and under no
circumstances shall any bondholder or bondholders (in¬
cluding in this term any coupon-holder or coupon-holders)
have any right to institute an action or other proceeding
on or under this Indenture for the purpose of enforcing
any remedy herein and hereby provided, or of foreclosing
this mortgage, except in case of refusal on the part of the
Trustee to perform any duty imposed on it by this agree¬
ment ; and all actions and proceedings for the purpose of
enforcing the provisions of this Indenture shall be insti¬
tuted and conducted by the Trustee, according to its sound
discretion ; but the Trustee shall be under no obligation to
institute any such suit, or to take any possession under this
Indenture, or to enter any appearance, or in any way
defend in any suit in which it may be made defendant, or
to do anything whatever as Trustee, until it shall be
indemnified to its satisfaction from any and all costs and
expenses, outlays and counsel fees, and other reasonable
disbursements, and from all possible claims for damages,
for which it may become liable or responsible on proceed¬
ing to carry out such request or demand. The Trustee
may, nevertheless, begin suit, or appear in and defend
suit, or do anything else in its judgment proper to be done
28
by it as such Trustee, without indemnity, and in such case
it shall be compensated therefor from the trust fund.
It shall be no part of the duty of the party of the sec¬
ond part to file or record this Indenture as a mortgage or
conveyance of real estate, or as a chattel mortgage, or to
renew such mortgage, or to procure any further, other or
additional instrument of further assurance, or to do any
other act which may be suitable and proper to be done for
the continuance of the lien hereof, or for the giving notice
of the existence of such lien, or for the extending or sup¬
plementing the same ; nor shall it be any part of its duty
to effect insurance against fire or other damage on any
portion of the mortgaged property, or to renew any poli
cies of insurance, or to keep itself informed or advised as
to the payment of any taxes or assessments, or to require
such payment to be made; but the Trustee may, in its
discretion, do any or all of the matters and things in this
paragraph set forth, or require the same to be done. It
shall only be responsible for reasonable diligence in the
performance of the trust, and shall not be answerable in
any case for the act or default of any agent, attorney or
employee selected with reasonable discretion. It shall be
entitled to be reimbursed for all proper outlays of every
sort or nature by it incurred in the discharge of its trust,
and to receive a reasonable and proper compensation for
any services that it may at any time perform in the dis¬
charge of the same ; and all such fees, commissions, com¬
pensation and disbursements shall constitute a lien on the
mortgaged property and premises.
In case at any time it shall be necessary and proper for
the Trustee to make any investigation respecting any facts
preparatory to taking any action, or doing or not doing
anything as such Trustee, the certificate of the party of
the first part, under its corporate seal, attested by the
signature of its President, and the affidavit of one or more
34
Directors, shall be conclusive evidence of such fact to pro¬
tect the Trustee in any action that it may take by reason
of the supposed existence of such fact, unless otherwise
expressly provided herein.
All recitals, statements of fact and representations herein
contained are made on behalf of the party of the first part,
and the party of the second part assumes no responsibility
as to the correctness of the same ; nor is the party of the
second part to be understood as making any representa¬
tions as to the character, extent or value of the above
described property, or as to the title thereto.
Article XVIII.—It is agreed between the Railroad
Company on behalf of the stockholders and Directors
thereof and the Trustee on behalf of those who may be¬
come holders of bonds secured hereby, that no recourse
shall be had in any event for the payment of any of said
bonds upon any present or future stockholders or Direc¬
tors of the Railroad Company by virtue of any liability
imposed or which may be imposed by law or otherwise
upon the stockholders or Directors of the Railroad Com¬
pany. And it is agreed that whoever purchases any of
said bonds thereby waives all such recourse.
Article XIX.—Upon payment of the jirincipal and
interest of all the bonds secured hereby according to their
terms and the terms of this mortgage and the reasonable
compensation and legal charges of the Trustee, the Trustee
shall, on demand, execute and deliver any instrument
which may be necessary or proper to secure the cancella¬
tion of this mortgage and the discharge thereof from
record.
In witness whereof, the parties hereto have caused
these presents to be subscribed and their seals
aifixed the day and year first above written.
25
TEXAS CENTRAL RAILROAD COMPANY,
By
President.
Secretary.
THE FARMERS' LOAN & TRUST COMPANY,
By
President.
Secretary.
State of New York, )
County of New York, | *
Personally appeared before me, the undersigned author
ity, a Notary Public for the City and County of New York,
Henry K. McHarg, known to me to be the person who
signed the foregoing instrument of writing and mortgage,
dated the first day of April, 1893, and acknowledged to
me that the same is the act of the Texas Central Railroad
Company, and that he executed said instrument in his
capacity as President of said company, for the purposes
and considerations therein set forth, and caused the same
and his signature thereto to be attested by Richard Oliver,
Secretary of said company, under its common seal.
Witness my ofiicial signature and seal of office,
this the day of , 1893.
26
State of New Yoek, )
County of New York, ) *
Personally appeared before me, the undersigned author¬
ity, a Notary Public for the City and County of New York,
, known to me to be the person
who signed the foregoing instrument of writing and mort¬
gage, dated the first day of April, 1893, and acknowl¬
edged to me that the same is the act of the Farmers' Loan
& Trust Company, and that he executed said instrument
in his capacity as President of said company, for the pur¬
poses and considerations therein set forth, and caused the
same and his signature thereto to be attested by
, Secretary of said company, under its
common seal.
Witness my official signature and seal of office
this the day of , 1893.