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The condition of the present management of the Union Pacific Company has
an important bearing upon its ability to comply with the terms of any
settlement of its indebtedness which may be offered by the Government.
The majority of the commission are in favor of an extension of the time
for the payment of the Government indebtedness of these companies, upon
certain conditions; but the chairman of the commission, presenting the
minority report, recommends, both upon principle and policy, the
institution of proceedings for the forfeiture of the charters of the
corporations and the winding up of their affairs.
I have been furnished with a statement or argument in defense of the
transactions connected with the construction of the Central Pacific road
and its branch lines, from which it may not be amiss to quote for the
purpose of showing how some of the operations of the directors of such
road, strongly condemned by the commissioners, are defended by the
directors themselves. After speaking of a contract for the construction
of one of these branch lines by a corporation called the Contract and
Finance Company, owned by certain directors of the Central Pacific
Railroad, this language is used:
It may be said of this contract, as of many others that were let to the
different construction companies in which the directors of the Central
Pacific have been stockholders, that they built the road with the moneys
furnished by themselves and had the road for their outlay.
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