issue of no less than a total of $160,000,000 of consolidated five per cent, bonds, of which $75,000,000 were to be reserved to refund first-, second-, and third-mortgage bonds; $26,000,000 were to be issued against existing branch lines; $20,000,000 were to be reserved for additional roads and extensions; $20,000,000 were to be reserved for terminals, etc.; $10,000,000 were to be reserved for premiums on bonds exchanged or refunded; $9,000,000 were to be issued for general purposes of the company.
It was by far the largest mortgage ever created up to that time on any American railroad, and its size excited much wonderment and varied comment, but its reception upon the whole was rather favorable. Its author became the subject of a good deal of banter in the press and in social circles. At a reception given to the late James G. Blaine, with whom Mr. Villard had been well acquainted for nearly thirty years, Mr. Blaine inquired after his health, and, on being told that he suffered a good deal from rheumatism, replied that it was not to be wondered at that a man who could float a $160,000,000 mortgage was afflicted with rheumatic pains.
His German friends had approved of the consolidated mortgage, and once more showed their faith in him and the Northern Pacific by purchasing immediately $6,000,000 of the new bonds and acquiring thereafter $4,500,000, all of which were introduced in the German market. His and their confidence was fully borne out by the gratifying growth in the earnings of the road from the figures of 1888–1889 to $25,151,544.09 gross and $10,211,141.91 net. This great gain was the more hopeful as it was earned notwithstanding the fact that the mining branches in Montana had begun to show a loss of traffic, owing to the decline in the market value of silver bullion. It even justified, in the judgment of the board, the distribution of a dividend at the rate of six per cent. on the preferred stock. Altogether, up to the spring of 1890, Mr. Villard was carried upward again by the high tide of success, and the prospects before him seemed never more serene and promising.
