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Maps, plates, charts, etc., may be filmed at different reduction ratios. Those too large to be entirely included in one exposure are filmed beginning in the upper left hand corner, left to ' BOARD OF DIRECTORS. (iKoUriK STKIMIEX, AroMiiKAi.. avm. c. van ii')iiM;. .1,) Hon. I U)!^' a I.I) A. SMITH, .1,, UK 11 Alii) J 5. A:;(irs, ,i,, ED-AirXI) r,. OSLKll, Toi;(.NT(). SAXDl'oRI) I'Ll'.MINd, CI-:., ('.>l.r r. (illKNl'KLL. ,1,, c. 1). i;osi"., ,1,) J(. V. MAUTINSI'lX, - - . - Am>ti:i;iiam AM) Xi:\v VoiiK. Hon. W. L. SCOTT, Kiiii:, I'a. GEOIK ;E U. llARRl,-^, or .Mkssks. JJi.aki; r.i;o.~. .\: ( o., - JWton. Ml OFFICERS. (.HOllGKSTEl'HKX, iV-.9-'/, ,//. Monti:i:ai.. w. c. VA>; ii()RXE, r;r,-7v.M'/r///, - . . . ao H<.n. . I. . I. ('. A iVr.OTT, (.'*/'7'o//( /', - - - AVinnii'ico. IIEXRV 1>1"".ATTY, J/((//(///( r X"/.( VV'/z/x/^oy/aZ/o/^, - - Tokonto. .lOHX ]M. I'lGAX, (,'i.ii.-,Sii)il. ]\', shm J):risiiiii. • - Wissivvic. WILLLV.M WnVTE, " Emaihiiaij. FOURTH ANNUAL MEETING. Report of the Procet'.diwjs <(t the. adjourned Annual and Special Meeting/ of Shareholders held, thU loth day of June. 1885, in pursuance of a resolution of adjournment passed at the Mectintj held, in accordance with the precisions "f the Cumpamj's charter, on Wednesday the \?Ah day of JLiy last. The shareholders asserablecL in .onibrmity with the notiee couvening the nieetiug, at noon, at the oiiict^s of the Company in Montreal. The Pn^sident, Mr. George Steph(^n, took the chair, and the Secretary of the Company acted as Secretary of the meeting ^S- The shareholders present in person, and duly repre- sented by proxy were ascertained to be 269 in numl)er, holding 882,188 shares of the stock of the Company. The annual report, a copy of which is attached hereto, havinjx been read, the President made the following remarks : — In moving the adoption of the report which has just been read, I desire to say a few words which I think necessary fully to explain the position of this Company's affiiirs at present, and which (^ould not well be com- pressed within the limits of the oiRcial report. 6 You will, no donl)t, concur wiih mc in thinking that the stutenn'iits which the Directors huvo laid bc'lbro you in the report -aw such as to inspire coniidence in the su(t- cess of the undertakiiin-, wliile, at the same tinu^ they indicate much that remains to be done before that su<'cess can be secured to its fullest extent. T congTatu]at(^ you upon what I think 1 may \'enture to call the unparalleled rapidity with which the railway has been constructed, and upon the results which its operation has ah\'ady aciomplished. Th«' lig'ures placed before you are not approached in the history of railway construction, and as well from the reports of persons skilled in su[)y disturbances in the North-West, the Company has been fortunate in being able to assist in the transport of troops and material to the iield of action, and although, of necessity, some discomfort was expe- rienced by the volunteers in their passage north of Lake Superior, the speed with which that transport was efle(^-ted contributed, in no small degree, to tln^ suppres- sion of the outbreak. This circumstance has drawn attention, both here and in Europe, to the probability that the railway may, upon its completion to the Pacific Ocean, bear a still more important part in the defence of the Empire, and that its usefulness, in that respect, will form an important adjunct to its value as a peaceful instrument in the consolidation and development of the resources of the Dominion. I ',' One of the subjects which are most debated with refer- I i eiico to tho railway, is th«' posiiioii and value of its acquired and leased lines. On this sn})j(Mt you have some statistics in the report, and I would only desire to add a few words to the information so o-iven you. Th(» main line of the railway, as you are aware, termiiuites at Cal- lander, but for the purpose of connectinp; it with the sea- board, with inland navigation, and with the railway systems of Ontario and Quelx'c, an extension of it to Mon- treal and Brockville has been acquired, and the consoli- dated line known as the Ontario and Quebec liailway, passing through Ontario and conuecling with American lines and with Lake Huron, has been leased in perpetuity. These acquisitions by purchase and lease have been fre- quently referred to as involving the expenditure of money more properly applicable to the construction of the main line. But as respects th(» original expenditure upon these lines, it is sulhcient to say that it has already been repeatedly shown that the cost of the a(>quisition of the extension to Brockville and Montreal, with many other similar expenditures, was more than provided for by the Company itsfdf from funds derived from its own stock; and that' the Ontario and Quebec system was a< quired and constructed by individuals, independent of assistance from any portion of the funds of this Company. What I desire now to point out to you, is, that returns of the actual traffi.' on the a.^quired and leased lines east and south of Callander show, at this moment, a net revenue exceeding by 25 per cent, the fixed charges upon them, and exceeding by above 10 per cent, the interest upon the entire cost of those extensions and leased lines, including such fixed charges. This gratifying result, as it seems to me, should put an end to the statement so freely made in various quarters, that the acquisition of these lilies by the (^ompany, constitutes a burden upon the enterprise, 1o say nothini>' of the ari»'uinent, which I I'll! Iv endorse, that their imi)ortan<-e to Ihe Caiiadiiin Pacific liiiiiway, in securiiift- for it the liandlinLiof trallic, will be at hnist equal to, and proba))ly ft'reatly exceed, in value, the revenue directly deri\'ed from them. T Mill ])l>'ase40,000,000 are held in I'hii^'land, about i^i;! 0,000,000 in the United States, and about isl."i,000,- 000 in Canada ; and it may not be uninterestinu' also for you lo know that th(> amount of stock now held by the oriu'inal promoters of the enterprise is li'reater than at any previous time in the history of the Company. Another subject has been engaginii- the attention of the Directors which had not reached a position to be mentioned in th(! report. I refer to the informal discussions wdiich have been taking place during thi^ past year with reference to obtaining access totln^ Port of Quebec, and towards pro- curing the construction of a shorter line of railway from Montreal to the Atlantic coast in the Maritime Provinces. The Directors have felt the importance of obtaining access to the city of Quebec, and to the sea-board at points oi:)en in the winter season, and Resolutions are now^ before the House of Commons tending to further both these objects The importance of a free access to Quebec was strongly felt at the time of the acquisition of the western section of the 9 I Qm'b<»c, Mont real, Ottawa iiiid O.cidciital TJiiilvvay, and ■conditions woro inserted in tlie a<4"reement ol" jnivehase from the Qne])oe Crovernmeut. wliieh. if curried out, would have !i (lorded the Company t lie dt^sinnl exit for its summer trallie. Those conditions, however, were not performtMl by the Com]ianv which obtained control of the l*]iist(n-n sec- tion, and althonii-h. as you will no doubt have perceived by the published correspondence, every oilort was made by the Canadian Pacilic liaihvny Company to obtain th<' carrying- out of th(? anToem(>nt with the Quebec Gov<'rn- ment, short ol' irro(^eedinu's at law lor (Miforcin^' them, these eilbrts were not su<'cessful. And the discontent which arose among the citizens of Quebec respecting thi^ very imperfect connection with the interior which was atford- ed l)y the Nortli Shore Eaihvay. through the controlling inlluence under which it has fallen, had culminated in an agitation for an eiiicient aiul <'onvenient access, to and from the City, for the internal and foreign trade which naturally appertains to that important sea-port. Such access this Company is equally solicitous with the citizens of Quebe(^t<) have placed on a proper footing, and no eilbrt will bo spared on its behalf to obtain such access, either by acquiring the North Short^ llailway, if that be pra(.'ticabl(^ upon reasonalde terms, or by making arrange- ments for such access as will operat(? as ellectually as would the actual acquisition of the railway itself. The further alternative of procuring the construction of a second line of railway from Montreal to Quebec, by a comi)any to b(> incorporated by the G-overnment for that purpose, and to be operated by this Company, is con- templated and conditionally subsidized by the Govern- 10 meut measure ; but is an alteruative which 1 sincerely trust there will be no necessity for resorting to. While on this subject I would like to take the oppor- tunity of expressino- my regret that the President of the Grand Trunk Railway Company should have seen ht, at the half-yearly meeting of the Shareholders of that Com- pany held recently in Loudon, to indulge in an unfair and uncalled for attack upon this Company. It would serve no useful purpose for me either to answer his per- sonal attacks, or to notice the insolent language of some of the other speakers at that meeting — speakers who are regularly put forward at such meetings, to speak not only of tlie Canadian Paciiic Company, but also of the Canadian Grovernment, in t(>rms that would be impolitic for the President himself to use. The President of the Grand Trunk Company, after expressing grave doubts as to the possibility of the Canadian Pacific ever being able to pay its own working expenses, and pointing out the consequent worthlessness of its obligations to pay the rental of its leased lines, the Ontario and Quebec^ in particular, becomes sympathetic over the troubles he pictures for us, quite forgetting his own for the tim(\ He goes on to say that the question is not how much profit we will make in the first few years, but how much loss we will suffer in working our Eailway, and how much more money wc will want to complete it. He winds up his melancholy forecast of our future by observing, that the best thing for the Govern- ment and ourselves, would be that our Railway should be taken over by the Government, and that when that happy time comes, as he thinks it must come, there w411 be an end to undue competition : and he promises the friendly assistance of the Grand Trunk proprietors to « 11 i enable the Government to work our line with as little loss as possible. What weight the Grand Trunk shareholders attach to the oracular utterances of their President I do not know, but I think, in fairness to them, if not to ourselves, he should have stated that his information was entirely second-hand. I doubt if he hns ever seen a mile of the Canadian Pacific Railway or been within a thousand miles of that " vast country," the opening of which he was obliged to say might do the Grand Trunk Eailway much good by bringing new trafiic into Canada. Had he told his hearers how ill-qualilied he was to form a correct opinion on the subJL^ct on which he was so confidently presuming to enlighten them, they would have been better able to judge as to the value of the gloomv forecast of our futun; with which he tried to cheer up his desponding and somewhat restive audience. I will not follow the example, set by the President of the Grand Trunk Company, nnd occupy your attention with any opinions I may hav*^ on the position and pros- pects of that railway, or of any other business compi'ti- tor ; I could not do so without feeling that I was guilty of wanton impertinence. AVith reference to the conundrum proposed by Sir Henry Tyler to his shareholders about the difficulty of working our line " with a very severe climate and with " all sorts of disadvantages," much greater, as he claims, than those under which his line labors, it is suffi.-ient to say that during the two years we have been working the line between Lake Superior and the Kocky Mountains, a distance of nearly 1,500 miles, we have not— it may sur- prise you to know— had occasion to use a snow-plough T 12 to keep th(^ line opon : and during tho past unusually severe winter not one train has been delayed a minute on all of our lines in the North- West by suow or cold weather. Nor have I any apprehension that in publish- ing our weekly statements of earnings we will often be obliged to resort to the explanatory cable, familiar of Grrand Trunk shareholders. '• Line blocked by snow." For is it not Avithin the knowledge of every Canadian pri'sent that during the past wintfU" there was more trouble froui snow, and mor(^ detentions to trains from severe Aveather, on the :]oO miles of the (rrand Trunk Eaihvay bet\vc>en ]\Iontreal and Toronto than on all the 2,800 miles operated by the Canadian Tacihc Company? I commenced these remarks by saying that I regretted that the President of th(,» Grrand Trunk Company had gone out of his way to speak ill of this Company, and I repeat this regret most sincerely. lie has sot an example whi(,'h I hope will never be imittited bv anv President of the Canadian Pad tic Rail- way Company. If it is a fact, as Sir IL-nry Tyler stated, that the few individuals connected with th.' Canadian Pacilic Company, who. at great personal sa<'rilice and inconvenience to themselves, found the capital necessary to provide the Canadian Pacilic with a valual)f > and indis- pensable connection in the Province of Ontario, did a very foolish thing for themselves, why waste time in persist- ently reminding them of their folly ? i^ If any of us have made a bad investment, it is our own aflair. and the loss will be ours. If, however, we are satisfied, why should the President of the Clrand Com- pany vex his soul about the safety of our investments ? ^ TT r 1 o I have always held the opinion that there is in Canada plenty of room for both Companies, and every day that conviction becomes stronger. Competition between us there must always be, but being competitors why should we be enemies, always at war ^ Reading between the lines of Sir Henry Tyler's speech, I think you will perceive some faint grounds for hope that he is tardily coming to the same conclusion as my colleagues and myself have always held on this ques- tion. He says to his Shareholders that " there is nothing " the Grrand Trunk desires more than to contribute to the " prosperity of Canada in every way by extensions of " railways throughout the country, and by opening out " those lines which will tend to develope the resources of *• the Dominion." If Sir Henry Tyler and his Grand Trunk Trunk friends had acted upon these patriotic sentiments, how dilierent would have been the relations of the two Companies ! But we can well afford to bury the past and to forget -the hard words and unfriendly acts of the past four years. Both railways are here, and here they must remain, and it is the duty of those who are responsible for their management to devote themselves honestly and earnestly to the development of the resources and trade of this, great and growing country ; and in this way they will best promote the interests of their respective Sharehol- ders, and secure a fair return on their invested capital. The two Companies, each independent of the other as they must always be, but working harmoniously for these common objects, will accomplish the purpose for which their Charters were granted, and for which the Country has so freely given aid to both. 14 The Chairman then moved a Hesolutiou adopting- the report, which was seconded by Mr. Van Home, and car- ried unanimously. The i'ollowing- resolutions Avere also unanimously adopted : — That the ibllowin.tr resolution passed hy tlio Boanl at the meotin'j hold on the Mth .Inne instant bo, and tlio sanu^ is, hereby raiiliod and coii- "Tlrit r.v-law No. ^o, lixin-r the lariir «>{" lolls, rates and lares be anuMide(', so that t\ie section relating to the conveyance oJ' emigrants shall read as follows:— " Emigrant fares one half lirst class passenger rates, except from Emerson and Grretna." That the minutes of the meetintrs of the Board and Executive Com- mittee held since the Annual ^h'etini:' held on the 14th .Alay, LSS4. and now laid on the table be, and the same are, hereby ai)i)roV(>d, ratilied and conlirmed. , ^ -- r r Thai the rennineration of the Tresident lor the current year be ^o,0()0, and of each Director other than the Tresident, SI.OOO ; that there be no special remuneration attached to the ollice of niendier of the. ]-:xecutive Committee; and that the remuneration of the Yice-1'resident, performing the functions of (Jeneral ^Manager, remain as heretofore. The Chairman haA'ing named Messrs. Edmund B. Osier and John Turnbull as Si'rutineers, a ballot was taken for the election of Directors for the ensuing year ; and on the report of the Scrutineers the following Avere declared duly elected : — Montreal. (i G-eorge Stephen, Hon. Donald A. Smith, ^Ym. C. Van Home, Tvichard B. Angus, Edmund B. Osier, Toronto. Sandford Fleming, C.E., C.M.a., ( )ttawa. H. S. Northcote, London. P. du P. Greuiell, C.D.Rose, E. V. Martinsen, Amsterdam cS: Ne\A^ York Hon. W. L. Scott, Erie, Pa. f^ -^rge R. Harris, of Mess. Blake Bros. & Co., Boston I 15 And ou motion it was RsolmL That tlie General Anmuil Meetin- runvened for the el.M^tion of Directors and the transaction ..f husmess -enevally ho ad.i..urne.( until Tlr^^^^ 25th day of .Iun(> instant, at the san.e honr and place, • and tlmt su.-h adiuuvnnient Jn take etfect upon tl>e lerniination ot the special business of which noti.'c has ))e.n» -iven. The meetino' was then made special ior the considera- tion of the said special business. And the President stated that some informal discus- sion had taken place with the Government ri^specting the best mode of obtaininu" access to Quebec, and with offi- cials of the Grand Trunk Railway as to the North Shore Railway ; and that in view of the resolutions now before the House of Commons, it was (Expedient that such author- ity as the Shareholders might determine upon in respect of that important subject, should be conferred upon the Board : — 1 thereupon it was 7?r^ohry are, hereby nutl i/ed t >nt r into s„-h a-reenumt ^vith the ( iovernnHUit and with mfne on and as tl,cv ronsider necessary to_ meet the reqnireme ts ol Se s;i^rK^^>lutions and of tl>e (Government, in connclion therewdh. And on motion it w^as further R,ohrd, Tlmt this meetinj. for spe.'ial business be also adjourned until Thursday the -'otli dav of June instant, at the same hour and i.lace, su. 1 bSl?to be takln up immediately alter the business of the adjourned General Annual :Meeting has been transacted. At a meetino' of the new Board subsequently held Mr. George Stephen was re-elected President, and Mr. W. C, Yan Home, Vice President of the Company. i I I REPORT OK THK Directors of the Canadian Pacific I'ailway Company, submitted at the adjourned annual general Meetinu ok the Shareholders, held at Montreal on the 1:]th June, 1885. A general balance sheet, with accounts and statements showing the position of the Company at 31st December, 1884, are herewith submitted to the Shareholders. Progress of Construction. The Directors beg to report that — During the past year, the work of construction on the main line has been prosecuted with uninterrupted energy and su(;cess ; the promise made in May last to the Share- holders, in the Annual Report, "that the rails will be " laid from Callander to Tort Arthur within a year from " this time," having been literally fulfilled. On the Mountain Section the rails are now laid to a point near the summit of the Selkirks, forming a con- tinuous rail connection from Montreal westward for a distance of nearly 2,500 miles. On the G-overnm(uit Section between Tort Moody (the present Pa<-i[ic Ocean terminus) and Savona's Ferry, a distance of 213 miles, the rails have been laid ; and this section of the line, which will soon be handed over by the aovernmeut to the Company, has been operated for some time past by the Contractor who built it. 18 On the section between >>avoniis' Ferry and the present end of tlie track, near the summit of the Sclkirks, a dis- tan(;e of 203 mih's (the only remaining- gap l)etween Montreal and the Tacilic Ocean), the work is so far advanc(Hl, as to .justify the expectation that the rails will 1)1" laid bi'ibre the end of September — rompleting the track from end to end of the entire Main Line. The Directors, therefore, can confidently assure the shareholders thnt by the early spring of next year tlie through line from IMontreal to the raciiic Oceau (a distance of 2,8it"j miles) will be finished and in per- fe(;t condition, thoroughly equipped, possessing every re(pusite facility for doing its work economically and eliiciently, and at least e(iual to the best of its eompeti- lors in all respects ; particularly as to curves and gra- dients, permanent way and rolliiig stock ; the (piality and character of the railway being far above the standard hxed in the contract with the Oovernment. The Company will then have built and equipped 2,244 miles of railway within live years from the time it began work. I Financial Position. In considering the hnaueial position of the Company, it may be well to remind the Shareholders, that at the beginning of the present year there remained in the hands of the Government ; an unexpended cash balance of $8,033,082, available for the work under contract with the Government. This sum, as has already been offi- cially stated, is sufficient to complete the work remaining to be done, according to the terms of the contract. It will be remembered that under the contract with the Government, it was stipulated that the line to be built by the Company should be of a quality and charac- 19 ter of[ual to tho Union Pacific Uaihvay as it was in Voh- Tuary, 1878. But since that date the Union PacifK^ Hail- way has been o-nnitly improved, and other Taciiic railways of a hio-h chiss have ])een built ; and it will be obvious to th(^ Shareholders, that in order to ensure the complete success of the enterprise, as a iommercial undertaking', it is absolutely necessary that the railway, on its open- ing- for through tralht.'. shall be in all respects, at least ecjual in elliciency to any (A' its transcontinental competi- tors as they now exist; and that it should be provided with ample iaeilities for takin-a' care of its rnpidly increas- inu' local trallic. Recognising- this necessity, the Directors have made during the past year large expenditures for rolling stock, grain elevators, terminal and oth»n- facilities, and for the o-eneral improvement of the lines in operation,— all neces- sary to secure the requisite high standard of elliciency, thoun-h not fuUv foreseen at the time the contract was made with the Grovernment. The amount expended towards this obje.t during the past year was |;4,702,G84. and this sum, it will be noticed, accounts ibr the greater part of the iloating debt shown in the balance sheet, "i^'urther additions to the equipment are now being made ; additional facilities will have to be provided immediately, and the usual improvements inci- dent to all new lines must be made from time to time. All the various needs of a new railway in a new and rapidly growling country, and everything necessary to secure economical and efficiimt operation, and the full development and permanent control of its tratiic, must be supplied. For these purposes, the estimated amount required will be as folio w^s : 20 Foi sleeping vavf^, pasKunyor cars, .lini.if.' cars, baggage, mail and oxprcHK cars, emigrant cars, box and cattle cars, conductors- cars, derrick, tool and other auxiliary cars, locomotivi,-. biind cars', i)ush cars, track tools, semaphores and other equipment rc.|iiisite for operation of line, also for restoring construction locomotives to good working condition For elevators, at I'ort Arthur, Fort William, Montreal, etc. ; coal- bmdiers, Montreal; additional real estate, Montreal and els..- wliere;revetm( lit walls at Montreal; additional depots ami tiacks'and other facilities, Montreal and other points; addi- tional yard room and tra ks, coal and other docks, and other terminal facilities at Fort William jand Port Arthur For divisional shops and machinery at nine points, coal docks and machinery at two points on Lake Superior section; sta- tion buildings, section houses and miscellaneous buildings at variMis points; additional station sidings and crossing tracks at various jioints ; extension of divisional yards ; additional engine houses; improvement in water supply; additional tanks; permanent bridge work at the various crossings of Bow lliver and on other sections ; additional ballasting, tilling trestles and raising roadway For completion of telegraph system, main line and branches. ... For connection with Coal Harbour and English Bay ; shops, build- ings, docks, tracks and other facilities at Bacilk terminus Contingent expenditures . $1,000,001) V)O.Oi)0 • •«••• ••«••■ 600,000 275,000 760,000 910,000 $5,045,000 At the end of December last, according to the Balance Sheet submitted, the total assets of the Company amounted to 8210,711,725.58, as under :— 2 658 miles railway and 'appurtenances, including steam- ships and telegraph lines $115,173,416 26 713 miles railwav, built by Government, and given to Com- pany free, a^ part of subsidy 35,000,000 GO 21 399,737 acres agricultural land, valued at S2 per acre 42,799,474 00 Amount in hands of Government to pay 9 years 3 per cont. dividend on Capital Stock of Company 14,288,288 87 Balance due on lands sold 2,078,286 56 Land Grant Bonds in Treasury '28,500 00 Outside assets ^ ,643,759 89 Total assets _ S2JL6J IjjT 25_ 58 21 Represented by total liabilities amounting t.» $100,914,301 As uiuler : Capital stock $05,000,000 Canada Central IJonds 1,82:5,333 Quebec Provime (due on account Q. M. 0. k U. Hallway) ,r"^T! Dominion Government Loan 2(3,007,512 Land Grant Bonds (outstindinj:) 3,GSH,000 Floatinfi Debt G,8lt5,MU SIOG.OU, 30G Assumiug that the re-arrangement of the Company's finances now under the consideration of Tarliament be- comes law, and that the i^l5,000,000 mortgage bonds provided for under this re-arrangement are sold at par, the following may be taken as the prospective financial position of the Company at the 1st of June next (1886) ; after having expended the i|8,683,082 remaining in the hands of the Government for the completion of the mam lin^, after having provided for the payment of the fioat- ino- debt amounting to $6,895,401, and after having ex- pended the estimated $5,045,000 required for additional equipment and facilities, : ASSETS. 2658 miles railway and appurtenances, including steamships ^^, ui;„^. $128,851,498 and telegraph lines '*' ' ' 713 miles built by Government, forming part of subsidy 35,000,000 21 399,737 acres of land valued at $2 per acre 42,799,474 Amount remaining in hand to pay 3 per cent, dividend on Capital Stock for 7^ years .•. ^^^^^^^^11 Balance due on lands sold '^.J-^n ^ . , , 6,643,759 Outside assets ••••• •• q 059 539 Cash balance from proceeds mortgage bonds d,^)oJ,o6>) $230,960,585 MAIMMTIES. sor),o((0,ooo <'"l''t''' ^''"'^ 1 8.>3 33'i C.um.iarn>tr,il I'...ml« ..'r,,,,',,;,,) l.roviiuoof.^.,.-lu..- •••••••••,; .>o!i.0.u.o.> Clnv.Tiim.'nl LoiiuH (^^fciiivcl l.y 1k.ii.1>) , con up. . (invc.innK.it Loan r.al.UK-. (so.u.v.l l.y lands) ,- , ^ I FirKtMcrtu-Uf n.-iids ((.utstaiidinK) l..,«)no,00> ' „ , :;.(]H8,oi)0 •Land (iraiit iionds ; Si 18,S',i2,'2-ir> TilH l'ixi-:i> CiiAiKiKs will then 1)>' iipproximati'ly as lollows ; — §20. 1)00, (Mil) Cidvcrnmi'nt Loan, -I pel cent . *ir..O(i(),()iii) First Mortgage Bonds, f. irt t-vnt •• , '" i''..5n(),o()0 duo GovenniKMit (.inolirc (account (.1 M. O. k O. Uail- * ' ' , . 17r.,0n(> wav), 5 per cent _' «1 H''3 OnO Canada Central Bonds imd Sinking Fund, 6 pur cent. 10 . ,\m llcntal Leased Lines S'i, 01 0.834 Add § o|-th.>propos..,nKmas;.ssc,-uvilyrov Hic pavinont ol all onual ..uouni ol tl>c d.1,1 ; .,wl. ns s,...uvily lov the p.yn.cu ol th,. rc-m,unins <^9,880.IM-2. to ivl^iu a lirst hen on Ih, nnsohl land ol' the Company, suhjert to the oulst.nd.n- Lund (iinnt lionds. This mcasniv does not allbvd means loi- so eonil.h.te and advantageous an avrane-ement of the Companys allau-s as wo«Ul Im-e heen attained under the ,.ond.tK.nssu-ested in the I'resich.nfs hMler of the l«th March h.sl. a copy ol .vhiel, and or the Uesohltion hased thereon •'""• helore Parliament ^viU be found in the Appendix to this Iveport. But th,. proceeds of th,. iJlo.Odo.nnil of lirst Mort-agv Bonds Whi.h will he availahle lor use i.y the C'ompauy, will be sufR,i,.nt I o enable it to l>ay th,. Iloatiugdebt, and to provide for all th,. additional e.|uipment and facilitie^ whuh will be iicded to plac th,; .arryins pow,n-s ol tha (..ompanj. aud its a,.c's, Exp.mses and Net Earnings for 1884. Month. Eahnincs. IvXI'KNSKS. NkT EAI(.\I.Ni,i] June 55(),(;G1 July 54'J,:!G7 Au^Mist. r)Gr),«M September CSDHSU October 73."..5;!l November 640,37:'. Dt'comber 521.r)r)2 cts. ^ cts. S cts. 02 401,itl5 19 127,270 17 Dejlcit 54 363,965 48 139,326 94 do. 22 355,275 76 75,700 54 do. 52 318,1)38 71 25,027 81 77 349,7311 93 74,816 84 22 391), 030 12 151,631 10 21 394,673 03 154,694 18 47 383,98:! 85 181,8,30 62 78 407,628 74 232,211 04 11 438,082 62 297,448 49 :',8 395,160 37 245,213 01 03 350,236 95 171,315 08 S5. 750, 521 27 Sl,5;"'8,630 75 $1,191,890 52 Dnrino- the lirsi lour months of the present year, 1885, the earnings and expenses have been as follows : — January . February. March . . April . . . $ cts. 423,764 16 401,508 14 489,151 89 692.141 43 S cts. 339,058 50 334,361 71 :!60,624 GG 367,776 ."i9 Total S'2,006,565 62 Si, 401,821 46 § cts. 84,705 66 67,146 43 128,527 23 324,364 84 S604,744 16 There is thus shown an improvement in net results over the first fonr months of last year of $922,014. The amount of construction material carried this year being $129,318 gross, as (^ompared with i$10G,120 gross, for the same time last vear. 27 Accordino- to the above statement, and assuming- that the net earmngs loi tht last i^m vear will be no more than they were ioi the last i Cths of 1884, the result tor the present year w.U be auetproritof$2,113,l»04. As .u increase in net earnings ibr the last eight mmiths ott;:;rmay t.uny be e.pe.t.l, ^he Di^ctors^ W.v^^ th. ihi net result of the pveseiit yeav s opeuvtioi s ^^u ; f M ror of ^•2 400,000: a,ul without pretenclmg to not ia.l sriou oi ^-,'*vv,v^ • i • f.. inrlnlo-o m be able to Forecast the f^t-'- "^ -'t"=, "t,f t . , , irr. ■u^i ovtrMvan'ant ostimaies oi i^ai what might seem to be '■^!'^.^-^. ^^ believe prospective earnni- power ol /h- P'op _ ;^„.„i,^. hemselves .justiiled in -*"-'^t-" ''"iV", ,s • f'the ,u„g June 1st, 1886, which w. 11 1,,. tH^ '•-„.' ^^,„ ''^^;:!i-!t:;:t;^':;oS,a;::ithe^^^^ every succeeduig yeai, as the -"""/.,, u>,^i,„.,v,. line is hrousht uuder cultivation, thn'ew.ll ^ v ■« = !:::^ . oustaut mcroase in the earnings and net results. The Ontario and Quebec "-■ f^" P*?*, '^Jr'.uid „,. uot opened lor tram. -'^^^^Z^::^:^ "T"^^tut;:!:r"x:;::^.S-rliiy to satisfy of the year; but the i exults ^^ t establish beyond Ure expectations 01 the Direaors..dt ^^ ^^^^^ question Its great \aluo as . "''■' ; ., ,.„^ jj,,. protec- profits of the Company, and Us necessity toi pt tion of the traffic of the mam hne. The Directors have no misgivings about the wisdom of The U ccto s ^ ^^^_^^_.^j ,^; ,^,^ ,„,a inde- their policy m suuun, n„t.,rio and Quebec, the pendent connecting hues in Ontario •" ' , ^ necessity for which was ^"^^^^^^^'^i^l^M the bitter hostility and unreasoning .jealousy with 28 Company has been pursued, from its very inception, by another Canadian railway company which has so long enjoyed an almost undisputed monopoly of the railway business of the Dominion. The Directors are convinced that without the control of tributary lines, reaching all the important centres of trade in the older provinces of the Dominion, the Company could have no adequate command of the traffic to and from the Canadian North-west and the Pacific Coast, and that the greater part of it would con- tinue to be carried by the American lines, as it has been in the past, and the Canadian Pacific Hailway would fail to accomplish one of the main objects for which it was brought into existence. Lands. The land sales for the past year have been as follows :— 798,584 acres, at an average pri(?e of $3.01f per acre. The total sales up to Dec. 31st, 188-4, were 3,730,187 acres Less cancelled sales 129,924 3,600,263 acres These cancelled sales were the result of failure on the part of the purchasers to carry out the terms of their con- tracts—in some cases as to cash payments, in others as to cultivation. Where the lands were held by speculators who defaulted in payments or in conditions as to cultiva- tion, it was thought best that the lands should revert to the Company ; but the most liberal treatment has been accorded to all bona fide settlers who appeared to have acted in good faith. The experience of the Company in the matter of laud sales has been to some extent similar to that of nearly all the land grant railways in the United States, where the '™ 29 first specnlative fever has almost invariably been fol- way lands increased, and prices m-'reased as ^^cll. ProRtin.. by the experience of others, this Company has exWv'y advertised the free Government lands, and mide every ettbrt to stimulate their settlement. T'^e-"^«--sttr:!:fw::::i;s:irr SirdirancJ ti: ,r" pl^ of the «ovcrnmeut lands V h tenmi es o^f the railway have b.en taken up and There art iudications of renewed activity ni the sales of the lands of the Company. L.iKD GE.iNT MOKTUAOE. The following was the position of the 5 per ceixt. Land Grant and Mortgage Bonds, at 31st December, 1884 .- §25,000,000 Total issue " DepoBitcd witU the Oovernmont a« BOcur.ty under Iho ^^^^^^^^^^^ contract, without intereht Held by the Government under the Loan Act, 1884, ^ ^^^^^^^^^^ without interest...... ••. ^^^^^^^^^^ Redeemed by land sales and cancelled 21,31 2,00o §3,688,000 Balance outstaudin'^ .-;:-: — A<.aiust this balance the Company holds interest-bear- 1 1 + 1.P rrvatifvino- to the shareholders to It will, no doubt, be giain>iiin . .,v m- pIpvm- tor companies, or aii> tniu^ oi 30 their line, nor any private interests of any description to absorb any portion oi' their prohts. The distuibanee amoni>- the Metis and Indians of the North-West Territories, although occurring' in a district several hundred miles north of the railwity, and in no way ali'ectiiig the Province of Manito})a nor any of the territory adjacent to the Company's lines, may for this season have a deterring eltect upon emigration ; but its ultimate inJluence will not be injurious in this respect ; while the outbreak itself, and recent events in l^urope and Asia, have demonstrated the vast importance of the Canadian Parilic Kailway to the welfare of this country, and to the Empire at large. The IJireclors, without having come to any decision in th(3 matter, strongly incline to the opinion that, under all the circumstances of the case, and especially in view ol the fact that the 3 per cent, guaranteed dividend, secured for the next eight and half years, yields to the Share- holders a fair return for the capital invested, it would not be expedient to pay any further supplementary dividend out of capital, during the short period which will be occupied in completing construction. The Direc- tors, however, believe, that after that period has expired the net earnings of the Company will soon be suihcient to w^arrant the payment of increased dividends. The Directors are happy to state that in the operation of the railway no material dilhculties have been encountered, and that, notwithstanding the unusual severity of the past two winters, the trafllc has been carried, both on the ]v>^;+ern and North-Western sections of the line, wath singular freedom from accident or delays ; and the statexuejit is now submitted with entire confidence, that fewer dilhculties will be experienced, in the future. \ Ir 31 will be ..-onsiderably below the average. The Direetov.vegvet losing. ..thevonheon^^ a«te«. who together ""'i;;''';"\. *, .^ ,; ^ed his seat work. Baron Uerua.h ol I a> ., >-";t;= ,.,,,„,!, wh., :l-rt-]^r'B:r,er:;:oS.nr.areh.., uow desires to retire. 1 • , IV.O Diveftors desir»> to say, that it has m -nelusum the Ihu to .^^^^,,,,,1011 ueees- W tl^- --;^;^^, ^^^^^^^ ownopuuon «ary to euabh.' ea.-h MiauuoRu ., ^^^^_..,,,, ^vhik- the or the position -^ P-^^^^? ^ Z.^;^^; ovne aux.ety past eighteen --^^^^^^^';;^; ^^ , ^^ embarrassineuts to the Directors, and the dii i uUu s a , connected with the nudertakmg -^-^^^ ^^ ^^^ ,,,, ,u they niight prove to he ove^^^^-. -;^^^^.^^^^ ,,, the Directors have never lor a uioimnt the ultimate success of the enterprise. OEOKaE STEPHEN, o o o o © © © © '£> ■M © Ji 00 1.-5 m 1 - "' 1 O I— -V o ^ to 1^ th ri CJ^ 1 00 r^ 00 CO GO J2 o 1 ■■/J CO o O H o I— I H !3 fl O o cq -i-> n CO Cfl t-^ oo" o "i. r-H o rH ^ o 00 CO lO f— < OO lO lO ■M Oi in l- •q OJ, 1— • 1 .—4 f^" lO iri 00 o CO 3^ '^„ 00 CO ■*" CO '7^ p P5l .S 73 ^-^ •■ji o o a — if) *" « = i fl ctf 2 o J • 9 xP r 2 "^ -"ij '^ a Q < 5 i 5 2 '^ a •; - - r. a :; o CO g 1 O H C S5 ;zi o H o ^ c ~-^ • ~ ?^ ^ -3 a ii3 3 - S cS = '•- -3 r. ;2 ■' :; 11 ■i-i •d Q in CO 00 jr H CI H o COiNDENSED BALANCE SH EET.— December 81st, 1884. COST Ol' K(»AI). Main Liiii'. . , . A((jiiiif built liy (Jovt. not includ- ed, o>tinmtt.Kl t08t. S3.'>, 0011, 000 I'lgni'Mi'.XT. Kolliii^^ Stock , Luke Strainers Shops and Macliim ly at and in ir Montreal CONSTHLJCTlON i'lant Tools & Outlit KI;AL KSTATK at and near Montreal ADVAN(.'KS and Expenditure on Leas( (1 Lines South Eastern Kailway St. Lawrenee and Ottawa Hall- way Atlaiitie and North West Hy. Maniloha South Western Colo- nization Hy Ontario Leased Lines ACCOUNT.S receivahle I\IATEi;iAL on hand DOMI N 1 ON G OVEliN MENT ouai!ANTi:k fund. Amount on deposit to guarantee 3 dividend on stock ; — Original deposit Additional deposit Amount advanced by Govt. . . . 7,350,030 13 607,300 02 003.1(15 11 CAPITAL STOCK M<'UT'.' of" g.M.O. .V O. Uy LAND (JKAN'l' I'.ouds ^Ist Mort- ga-.'). Amount of issue... $25,000,000 LESS amount re- deemed by Laud Sab'S . . . .' 7,:;10,000 $850,000 00 07:3,3;i3 ;J3 l,82.i,333 33 3,500,00(1 (»() 4.545,402 36 2,008.357 53 3,087,729 27 1 7,684,000 Amount held in trust by Domin- i; !. C;)vernm;'nt and not bearing interest 13.096,000 $3,638,000 3,688,000 00 COY 1:1: N MENT Loan. An'Oiint api»iied on ai ( oimt fd fund fur (b)Veruuient miaran- tee of dividend Tob'd Loan on ac- count ol con- struction 22.5(10,000 Amount received. . 18,626.600 7,380.012 00 18,620.600 26.00 7.5 12 00 14,288,288 87 i 2,078,286 56 r 28,500 00 Am't to be received. $;],£73,4(J0 LOANS Payable L'Nr.\ 1 ! I Voucher.sand Accounts. CASH Snb.^idy [laid by Ooveru- ment. Total Cash Subsidy Amount rec eived 2.435,047 on 4,460,413 71 25,000,000 00 20,240,317 87 20,240,317 87 Amount to lie received. . . . LAND CHANT . 3,600.263 acres sold amount'g to LESS — Expensesaud In Pre- mium on Land Grunt liuuds taken iu Payment TOWN Sites . Aujount reicived for Sale of Town Sites not covered by Land Grant [Mortgage BONUSES received from muni- cipalities. . . NETT Revenue trom road to date during construction (all Interest and Rentals having $4,759,682 13 10,506,234 41 1.111.047 85 been ileducted; . $138,912,251 58 0,304,286 56 504,675 72 2:12,000 00 1,026,064 79 $138,912,251 58 L G. OGDEN, Auditor. MONTIiKAL. JlXK 12th, 1885. 1 11 BALANCE SHEET AND STATISTICS. 35 DESCRIFnON OF FIir^lGHT CARRIED DURIX*; Till-: YEAR 1884. Flour ^"^."^^ ^'^'''^' Grain G,474,19- Bushels Livestock 136,890 Head Lumber 2-14,799,171 Feet Firewood •^^'^•'" ^"'^'^ Manufactured Goods 307,321 Tons Other Articles 375,701 Tons Number of PaHsengers carried during the year 1884 1,171.851 36 MILEAGE OF ALL THE COMPANY'S LINES. Miles. Montreal to end of track, near summit of Selkirk Mountains 2478.5 End of track to Savona's Ferry, under construction 203.2 Savona's Ferry to Port Moody (completed by tiie CJovernraont but nut yet transferred t(j the Company) - 1 3 Total Main Line 28y-1.7 Branch Links. Eastern Dicisi.on, in Opi ration. Miles. Aylmer Braach, Hull to Aylmer 7.5 St. .JerjUie •' Ste. Therese to St. .lerome 12.4 St^ Liii i' St. Liu Junction to St. Lin 13.0 St. Eustache " Ste. Therese to St. Eustache 8.0 Brockville " Carleton Junction to Brockville 45.5 Algoma •• Sudbury to Algoma Mills 96.0 183.0 Western Division, in Operation. Emerson Branch, Emerson to Winnipeg Junction 64.5 Selkirk " Winnipeg to West Selkirk 22.G Stonewall " Air Line Junction to Stonewall 18.3 Pembina Mountain" Winnipeg to Manitou 102.4 Gretna " llosenfeld to G retna 13.9 221.7 Total Branch Lines 404.7 Leased Links, in Opeuation. Ontario and Qiu'hec RailuKv/. Miles. Smith's Falls to Toronto Junction 211.0 Toronto to St. Thomas 124. 1 Toronto to Owen Sound - 121.5 Streetsville to Orangeville (Orangeville Branch) 31.(i Church's Falls to Elora (I'llora Branch) 27.() Orangeville to Teeswater (Toeswater Branch) 69.5 Total, Ontario and Queboc Railw iiy o82.2 St. Lawrence & Ottawa Railway 54.0 Manitoba & South-Western Colonization Bailway 51.0 Atlantic and North-West Railway (not in operation) 8.0 113.0 Total Leased Lines 095.2 Total Mileage of the Company s Lines ;],'Jj>4.() 3t Statement of Equipment at December oIst, 1884. Locomotives First Class Passenger Cars ^'^ Second Class Passenger Cars '^8 Inrst and Second Class Passenger Cars (composite) Bao-o-ao-o, Mail, Express and Smoking Cars 71 Exhibition Car Dining Car First Class Sleeping Cars ^'^ Emigrant Sleeping Cars -- Parlor Cars ' Street Car Otficial Cars Flat Cars ^'^^ Stone Cars ^^ Lime Cars 7>o Coal Cars T^ r\ ii,4oD Box Cars StockCars -^J Refrigerator Cars ^^^ Vans f. Pay Cars Derrick and Tool Cars '- Snow Ploughs and Flangers ^ Total number Locomotives • • Total number of Passenger Cars of all descriptions Total number Freight Cars of all des- criptions Conductors' Yans Snow Ploughs, &c 304 282 7380 163 37 APPENDIX. Com of /he appUmlion to the Guvemmmt for relief, together loilh tlie Resolutions Imsed th-.reor,, mlmilted to Partuumnt. Canadian Pacivio K.mt.way Company, MoNTPJiAL, 18th Mav<-h. 188;"). Sip,, In vi.nv of the approachiag .completion of the contract for the eonstructiou of the Canadian Pacific Raihvay from Callander to the Pacific ocean, according to the .-ontract ente, ^d into by this company, and of the consocpent necessity for making timely and ade,,uate provision lor the unexpectedly large volume of traffic which the line ha.s already developed, as ^vell as for the great mcvease ^vhich it is now certain will take place on the opening of the through line in the spring of 188^, the .■orapany finds itself compelled to seek for some re-arrangement ot its finances which will enable it to procure he necessary capital required for this purpose. 1 1'^^^' l^^',:""^; f^ honor.onbehalf of the Board of Directors of this Company to submit to you some observations upon the position ot the company, and offer some suggestions as to the neces- sary remedial measures for restoring to the company he fre; use and control of its own resources, and, at the same time, of practically providing for the ^P-^y-™ f the loan of last session, and -'''^^-f. /''« <^°:, ™ .'^ ! finally and forever, from all responsibility for, o. . oniicc tion with the Canadian Pacific Railway. It will be remembered, that under the provisions o the Act of last session, the Government, as sc^^urity loi the repayment of the loan to the oompany deemed it necessiry to take a statutory lien, not only on the line con- 40 traded to be built, but on the whole property of the com- pany, including its steamers and In-anch lines, practically stripping it of every resource it possessed, and leaving it without any means oi' providing for the important pur- poses of the enterprise, outside of the mere work of con- struction of the main line from Callander to the Pacific Ocean, and its equiprmmt, to the extent contemplated by the contract, except its unsold stock. That resource, the only on(». the company had left, was rendered unavailable owing, to some extent, to the provision in the Act, by which, in case oi cofault on the part of the company in performing the conditions on w^hich the loan was granted, the G-overnment could jn-actically coniiscate the whole property of the Compnny, but also, in u greater measure, to the unfair and :r.d -volent attacks of the enemies of the company, acting in t ^i "rt with some, happily only some, of the politicul opponents Oi tho Grovernment, aided by a venal section of the newspap>^;' press of the country. From these quarters tiie • omx)<.>> y and its resources have been unceasingly assailed and discredited during the whole of the past year in the most unprincipled and un- patriotic manner. A large portion of the country traversed by its lines has been decried as a barren and worthless desert ; the advant.iges of the Northwest, as a field for emigration, have been depreciated, and attempts have been made to create the impression that the line, when opened, could not possibly pay its working expenses, and that the G-overnment would be compelled to take posses- sion of it and operate it at a loss to the country, variously estimated at from 5^3.000,000 to 5^58,000,000 annually. In fact, the enemies of the company, both at home and abroad, availed themselves of the stringency of the provisions of the Loan Act, and of persistent and unfounded misrepre- sentations of the country, and of the conduct of the com- pany, for the scarcely concealed purpose of wrecking the enterprise. 4t By th..so moans invostors ^v,.re alnrm.a, th. ^'-'^J^^-^;^. pv '.nted from bo.omin,, .. was .xp..,.,.!, n, r^^ pvovidin. tho company ^vith the luucls uc-.ssavy o. Lo- on its l,usiiu-ss olli.iontly, and the ,-v,.d.. ol Ihe ' o,u pany was all but destroyed. The company, it will be -metul.eved at the .in.. oUhe p„,«,„„ 01 the Aet, oarnesily, but i"-«;-!-^">';; ^^ . trated against the severity "^ *1-.'™"^'*'" ", "" ^ '! the loan^as granted ; espeeiallypo.nt.no. out * /l;^™ = i„, eifeet o.. the future credit of .he ..o.npa. y o 1 c .st..^ne.ent and apparen.ly i,u.,,u,table ^^^-'^?^^^ ,..,medy take., by the Gover..me,.t, ... the ^^^^^ hy th/..ompa..y, a,.d their apprehe..s.o..s ... those .. sp. have been fully realized. The shaves of the company, at the ti.r.e "^ ^ ^^^^^^ of tho A,d last sessi,,.., were sell.ng at "bout *b P ^ » shares, a,.d were expected to advatiee ^^J^'^- .should fail to commatul the c.onl.de..ee of the .n^ st.n^, '^Thramount of the loan provided fo.- '^y.^r^;i^_ session W.S $22,.500,000 ; *7,.300.000 of ^''";;'^^; ' Joo priated to pay existing obligat.ons, -"^ "= ^ ;.^,^";^,, for the purpose of co.npleti..g the contract^ T'" : ' p the nlu «^710 000 unpaid strbsidy then in the hands o the plus ifl -, 1 1", J" I applicable o.ily to Governme.it, gave a total ol s,- ( , c. J, . i ^ the work u..der co.rtract. The .uode prov.ded by he Ac Uo obtaining paymc.t out ofthi_s '-^'I'-f-f,*,^ ^L that any part of it could be <^^-^l^^ C uctio.., for any purpose, except lor the bare cost o con vvith the stipulated amou.it ol roU.ng sto.k. liclo. u h payment cottld be made. a., estimate ^^^^'^'^ be prepared by the Governmc.t eng...eers, as the 42 procood'd, of the proportionate valuo ol' the work dono ; and tho amount of such estimate, less ten per cent., was paid to the company. But, in order to make the Railway a first class carrying power, with all the appurtenances and appliances necessary to enable it to comi)ete success- fully witli the best of the American trans-continental lines, much had to be done and provided l)esides the mere work of construction nnd equipment according- to the con- tract, and these rtH(uirements are not materially diminish- ed by the fact, whicli is admitted, on all hands, that the "W^hole line has been i-onstructedof a (piality and character far ex(HH'ding the standard ag'reed upon between the Government and the company. Upon the opening of the Railway in the Spring of next year, it cannot dispensi^ with a lull provision for its efficient and vigorous operation without great injury to its prestiu'e and future reputation. Its road bed for the 2,900 miles from Montreal to the Pa<'ilic Ocean, its lacilitates for hand- ling tralhc, and its (Hjuipment, must be of the highest class, not interior to those of any other trans-continental line, otherwise it will not command the trafhc. and the enemies of the enterprise will take a delight in pointing* to it as a reproach, both to the country and the company. For these purposes, the usual improvements required upon all new railways have to be made. Terminal faci- lities require to be provided, workshops have to be built and furnished with expensive machinery, (devators require to be constructed and many other things have to be done to provide for the unexpected development of traffic already reached, and for th(^ still greater volume which is certain to follow the opening of the line. Many of these things had to be done at once, and could be most economically provided concurrently with construction- It would have been unwise and improvident in the extreme to have postponed such provision until the last rail should be laid ; and the Company accordingly felt obliged to proceed to some extent with the most important 43 of these improv.'inciits. In cloing- so it relied upon the proeeeds of its unsold stoek. It rould not obtain one dollar for any of these purposes under the Act ot last Ses- sion, the provisions of whieh, as has been shmvn, ^^MM•e oourmed to the aetual work of creating the l,ed ot the railway, laving the traek, and supplying it with a certain quantity of rolling stock. The expenditure during the past year, outside of the contra-t, for the purposes reh'rivd to, amounts to about $5,000,000 ; and, in addition, in order to keep laith with the shareholders, provision had to be made for the payment of the promised extra dividend : and interest had to be paid amounting altogether to about s8 000 000 more. And as it was found impossibh' to realize, upon the unsold stock, some of the Directors resi- dent in Montreal gratuitously came to the assistaiK^e ol the Company, pledging their personal .-redit and their own private securities for the benelit of the Company, and so the money for the latter expenditure was lound. In the meantime the work of the contract has been car- ried on with the utmost energy and rapidity ; and it will be completed before the stipulated tim(N the money remaining in the hands of the aovernment, amounting on the 81st December last to $8. 7 26,04!», being suihcient to complete the performance of all the o])ligations ol the Company under the contract. As was expected, there has been a large saving effected on the cost ot the work on the Mountain Section, but the advantage thus obtained has been absorbed in extra expenditure on the Lake Superior section. To enable the Company to procure the additional capital that will be required for the purposes indicated, I beg respectfully to propose :— 1. That the Sa5,000,000 unsold .stock shall be caiu'elle.l. o. That authority be .ranted to the Conn>auy h. issue in lieu thereof $35,000,000, four per cent., iifty year, first ^^^^'^^ ';^^ ^^^^^l^ lirsUien on the main line of the Kadway from Montreal to the 44 OiMMii, covcrinj,' all tcni.iiinl.s Imill, or U> Im^ hiiilt, and all (?i|iii|niKMit and riit upnn it; to;_'\clopnient of its hnsiness ; and with its ci'i>.dit restored and re-e.stablishod in the conlldenci^ df its shareholdc^rs it would then he in a position to proceed, 1st. with the much wanted extension of the Manitoba ."rd, to si'cure, in some way, a connection with the City and Harbor of (Quebec; 4th. with rea.sonal)le aid from the (rovernment to extend tho ( anadian Pacilic system to the ocean ports of the Maritime Provinces; otli, it woidd also he in a ])osition to ainiain» for nn' to add tliat, n making this application to th. (lovornnuml. I 'l'';';;;' ', the fulU'st faith and ronlid-n.-,. iu th- pr..sont and lutui, mouey->na-ning power of th. .nt.rpriso. I am «at.slL,., that the resourc^es ot the Company are amply MrlUeienl laithluUv and honestly to disehavge every ohligaliou . has iueu'rred, whether to the Government or to others ; and that the Canadian Paeinc. Railway, upon its hnal comple- tion and eqnip.nent, will be one of the most mrportant and prosperous Railway properties on this Continent. Statements are appended showing the amounts ex- pended on improvements on main line and l.ran.-hes, rolling stoek, et..'., in 1884, beyond the requirements o the contract : and an estimate of the probable «P««l''";j^ for similar purposes, up to May, 1880, with severa other statements bearing on some of the matters referred to in this letter. I have the honor to be, Sir, Your obedient servant, (Signed), Geo. Stephen, President. The Honorable the Minister of Kailwavs and Canals, Ottawa. 4tl STATEMENT Showing- thr amounts expended })y the Company on :ilst DecemJx-r, lScS4, on coustruetion of main line and bianchos. extensions, lorminals, ini])rovemeiits, e(|uipment, interest and dividends ; also showing the total amount reeeived by the Company lV(»m its ts up to 31st December, 1883, as hiiowu by statement of that date $37,377,175 Amount received from Government loan to apply on 1883 ex- penditure 7,500,000 $29,877,175 Amount expended in excess of receijits up to 31st I'ecember, 1884, as shown by statement of that date ,. , . . $37,267,700 $7,390,525 Adil — Amount deducted from estimates paid by Government to repay advances on rails of 1883 339,235 >.et increase of expenditure over receipts from Government sub- sidy and loan during 1884 $7,729,760 I. G, OGDEN, Auditor. 47 Th(^ al)Ovo stntemi'ul is iiuidt' in comparison and to covi'V ilenis in staU'niont oi' l!SS:), hut doi's not covor t'X- pi'nditui't^ for interest, u,'<'n('ral expenses, interest on Gov- ernment loan, i\:«'. Kstinuited pro])abl*' expenditure to June, ISSO, Ibr addi- tional ('([uipment and imi)rovements, and I'or additional I'acilitit's neet.'ssury to advantau'eous operation, and lull development ol" trallic l'"<)i Klcfpiiif^ cars, i)assriif,'.T i ais, (liiiiiiL( cars, l)Uj,'Ki',-fi "">'• 'i'»<' express cars, ciui^'niiit cars, lioxaiid (attic cars, coiidiictdrs' cars, (IcrricU, tool and otlicr auxiliary cars, loconidtivcs, hand cars, piisii cars, tuK k tools, semaphores and other ecpiipnient r<(Hiisite tor operation of lini', aix) tor res- toring' cunstrnction locomotives to :,ond workin.u: cniuli- ti,,n $ 1,000,0110 For elevators, i'urt Arthur, Montreal, .Ve., (oal liunku.v. Montreal, additional real estate, Montreal and else Ahere, revetment walls, Montreal, additional depot and tracks •lud other facilities, Montreal and other jioints, addi- tional yard room and tracks, coal and other docks, and other terminal facilities at Fort William and I'ort Arthur 1,500,000 For Divisional shops and machinery at nine points, coal docks and machinery at two points on Lake Superior section. Station huildiugs, section houses and miscellaneous huild- ings at various points, addiiicnal station sidings, and crossings, tracks at various poi: :s, (X^ensinii of Divisional yards, additional cngino houses, improvement in water supply, additional taidvs, permanent hridge work at var- ious crossings Bow River and on other sections, addi- tional hallasting, filling trestles and raising roadway (500,000 For completing telegraph system, main line and hranches 275,000 For connection with Coal Ilarhor anil English Bay, shops, hiiild- ings, docks, tracks and other facilitiis at i'acilic terminus. 7(50,000 Contingent expenses ^lo.noo $5,045,000 CONTINGENT EXPENDITURE. Snow sheds in Mountains §450,000 Snow protection. Lake Supei ior section ^ (30,000 Prairie section, obliterating remaining cuttings • 100,000 Terminal facilities, at Quebec ^ '^' ^'^^'^ S910,00(; 48 Statemont of amounts expi'iided on improvements on main lin(' and branches, additional equipment, &c.. in 1884 in excess of estimates received, and beyond require- ments of the contract, and for whic;h no part of the gov- ernment loan or subsidy was available :— $843,694 Montreal to Sudbury 1 39" 845 Sudbury to Winnipeg ^ '..og'-gG Winnipeg W.St... ' ^ '^.^'^^^^^g Expended on liranclies I'K) 435 Expended on llovernmeut lines sItVgG Expended iu additional equipment '' __S4/70;2^(584_ Amount paid during 1^84 on inten st dividends, exchange, insur- ^^^ ance and geneial expenses ' ' ' ^ $8,181,269 Not included I the above estimate of extra expenditure on con- ttruetion between Michipicotcn and Port Arthur beyond the re.iuircments ot the contract, amounting to $2,500,000 Statement of the Accountant appointed by the Government to examine the books of the Company. Ottawa, 4th Hay, 1885. ;^i^,_I have the honor to state that in accordance with your instructions of the 13th ult., and the further verbal request of the honourable the Finance Minister; I have carefully examined into the books of the Canadian Pacific Railway Company, and have extracted from them a balance sheet showing the state of affairs on 31st December, 1883, and the 31st December. 1884, respec- tively. From this balance sheet I have constructed a statement, exhibiting- those phases of their expenditure into which the honorable the Finance Minister directed me more particularly to inquire, viz. :— The extent ot expenditure made by the Company upon the main line (from Montreal to the Pacific Coast) out of its own re- sources, independently of moneys received from the Gov- 49 prtiTTiPnt and the proximate causes whieh have h^d to the Xt of a Lung debt of from |6,000,000 to $7,000,- 000 I appe^^ the statement hereto, and have the honour to ^®' ^^^ Your obedient servant, Edward Miall. Hon. J. H. Pope, Minister of Kailwiiys and Canals. BALANCE SHEET. Canadian Pacific Railway-Condon.cd balance s!.cet 1st Jannavy, 1885 : West of Callander- S48,382,084 Construction 1241780 Improvements .*.'.'".'.*.'!'. ^,GB1,nd Material:^ S53,31 1,593 East of Callander— 4,213,758 On main line ^^ 9.168,755 Eqnipments on main line • ' ' ' ' " Interest, etc, on financial matters ^n connection wUh ain line construction, handling material, etc 1.389,474 mam $68,083,580 Received from Government- Subsidy Loan — Less Land — Proceeds of $20,240,317 retained for dividend gaarantee,$7,380,91 2. 18,626,600 8,702,086 Expended on main line out of Company's resom' $47,569,003 20,514,577 connections 5.857,224 1 1 ^,if ,^f Pnmnanv's fmids on connections ' Expended out ot company ^ 5,378,000 Dividend J" ^iU^wi ... ('.,907,377 Deposit with Government to gmrantee dividend __L— 1— Total expenditure made and liabilities incurred of other than ^^^^^^^^^^^ Government resources Provided thus. $29,568,1 23 Capital 232,600 Bonuses m4,el5 Town sites . .. ^^1,626.063 Karnings 169 74'-. Lrss— Balances due i,45t3.R18 Floating debt 6,895,462 $38.<;57,178 50 Hesolutions. On Tuesday. Iho 801 h April, 1S85, tho Tromior, The lit. Hon, Sir .Tolm A. Macdoiiald, i^'avc noti(;(^ in the House ol' Commons ol', aiul laid on the table, ihe follow- ing" TIesoluiions : — 1. That the Canadian Paeific llailway Company, under the authority of its shareholders, as provided by the 28th section of its CharlcM-, may issue and deliver to the Grov- ('rnm(Mit lirst morti^a^u^ bonds to the extent of $35,000,000, bearing' 5 pi^r (H^nt, interest, such bonds to constitute and be a first lien and charge on the «^ntire property of the Company, real and personal, now owned or hereafter to be aequired, or ownc^d by it (save and except the lands granted or to be ^^rantt^l by the (xovernment to the Com- pany under th<^ said contract), including' its main lino of TIailway with its tolls and revenues, the extensions there- of; its branch lines of Railway (except tht* Al^oma Branch), the whole of its equipment, rolling stock and plant, and all its steamers and vessels, saving always, however, the rights of tht* holders of the existing mort- gages on the extensions of the line of the Railway from Callandi^r to Brockville and Montreal as security for the unpaid balances of the purchase moni^y of the said exten- sions. 2. That the Company may secure the payment of the said l^onds and of the int(>rest thtn'eon by a Deed of Mort- gage executed by the Company io Trustees to be approved by the (xovtMiinKMit, with I he authority and of the tenor and })urporl, and containing the conditions, remedies, pro- visions and powers authorized and provided for by the 281h Se<-tion of the Charter of the Company, to such extent and in such mnnner and form as shall ])o approved by the Gov»'rnor in Council. ■ >. That upon the issue and delivery of the said Bonds Io the Crovernment. the lieu and charge created by the 51 Act 47 r/r/»aV,, Chapter 1, iutitnlea ; " An A.t 1- am.iul tny Id r.!r 01 h,^- inu.pos..s ■■ : up,>u the I ajhvay and pcvly or Ih. CVnapany aliV..t..d by U.o «-\ 'n" ; 1^ by he Dood of Mortgag.. sounng th.. same «hall ,n.asc io Z.i, a„d shall be rel..a..d and d s. uu.g«l m ro. ol the Railway and pvopc.ty so a.lerted, and h. ^ m tho .apital sto.-k of the Company, to th- .xUnt o *35 000 000 now in th- hand, of th. Govevnnient sha 1 t ol'. led and d-sfoyed. l',ut Iho Algo.ua Branch shall still remain charged with th,. lien and charge .•■ealcd by the said Act. 4 That the time for the payment ,.f the entire loan to the Company of §2!),880,ilf2 shall be lixed at the Inst day o May 891 and sc, long as default shall not occur m Ac P.mint of priuciiKvl or interest at the tinies when lh,.y IraU si-e ively become due. the interest upon the said tn ll^dl be cltnrted at the rate of 4 t.er eent per •uinum. But the Company may at any time pay the V ount of the said debt or any part thereof m sums ol not ti't^n $1,000,000 ; and if such payment be made on a c^unt ol the sum of $20,000,000, hereinafter menUoned, corresponding amount of Bonds shall be returned ,o it. 5 That as security for the payment of $20,000,000 of su h ill and of tlL laterest thereon ^'^ .^-erniuent liall hold and retain $20,000,000 oi ^'^ --' ^'^ ^ j „,,,e bonds, audio respect ol such bonds »"11.1;"'; The" rio-hls of bondholdars except as lo the «te ol mteiesl pio'vided in the last preceding secU.m. And upon p y- 1^01 any half-yearly instalment of such interest the at arly . .nponJattached lo the said bonds, correspond- l such lialf yearly payment of -^-■•-- f^^^ j cancelled and surrendered to the Cm.ipany. but il the CoTup 1 y makes default lu the paymeiitof the . uteres on th slid sum of $20,000,000 or of the principal thereot at 52 the time when the same shall become due respectively, th(? rate oi" interest upon the whole loan shall thereafter be computed at the rate ol' 5 per cent, per annum ; and such default shall be equivalent to a default in the pay- ment of the interest on the said Bonds, and shall entitle the Grovernment to the same remedies as if default had been made in the payment of the interest or principal of the said Bonds ; and upon the Company remaining iu default in respect C'f either the principal or interest on the said $20,000,000 for a period of 12 months, the Trustees shall be authorized and empowered to take possession of the property mortgaged and to administer the same for the beneiit of the bondholders c^enerallv. tj. That as security for the payment of the balance of the said loan amounting to the sum of $9,880,912, and the interest thereon, the Government shall have a first lien and mortgage, subject to the outstanding Land G-rant Bonds, on the whole of the unsold lands forming the remaining part of the Company's Land Grant earned and to be hereafter earned, such principal and interest to be paid out of the net proceeds of the sale of such lands ; and the Government shall continue to hold and retain the entire amount of Land Grant Bonds now in its (custody and possession as provided by the said Act. And if the net proceeds of such sales to be made from time to time in due course, shall be insuiiicient to pay the interest on the said last mentioned amount as the same shall fall due, or the principal thereof, when the same shall become due, the Governor in Council may order the sale by the trust- ees of su
  • ; ^f -\;'; secxuity for the .aid lirst mortg-age bond, until the .,ud umT|9,880/..12 and interest, and also the sau suur 420,000 000 and interest shall have been 1'-'^ - f ;,; '^ after payment ont of the proeeeds ol snel lands ol Ih. o landing Land Grant Bonds, and o ^^^-;^;^^ *0 880 912 and interest, the remainder ot sn.h lands shal Sai"; eharged with a first lien and privilegv in lav,>r o thrGovernment as additional seenrity for the payment ot the said sum of $20,000,000 and interest. 7. That the Government may make a t;-P°">;y " the Company of 45,000,000 to be rc-paid by «- J;,- '^^J to the Government on or before the tst day of July, 88 wiS interest at the rate of 4 per cent, i^r an.uun pay^J ou the 1st day of January and the 1st "^^y » ,^^^^ 'J, ^^ the Company to have the right to repay the said loan Dy instairentsif not less than $1,000,000 each, and to reoen e Tt^ment thereof, a corresponding proportion ol he amount of said bonds held as security therefor and a ei reXin.^ part ot the said bonds to the amount of >j8 000,000 to be Md by the Government as security lor the said em „ loan, and to be deli^■e.■ed to the Co„^^^^ payLent to the Government of the sard sum o'^o 000,000 inl interest in whole or in P'-*, '" P7<"|^°" ^ ."^^ navment the remainder of the said Bonds shall be liom Tme to time paid by the Government to the Company to riplied bv the Company under the supervision ol the Go iment to the payment for work done or to be done fo the devefopment. improvement and -'---"^^^ Railway, its conue.tions and "^-^P-^ ;''""" *". teuance of the credit, and efficiency ol the Company gen era ly to the satisfaction of the Government; and rf the Bonds in the hands of the Government, or any part thereof S be sold by the Company at a price - jf-'-J.^'' .^^ Government, the proceeds of such sale shall be paid into I > ^ 54 the hands of tht^ Government in the place and stead ol' the Bonds so sold, and such proceeds shall be dealt with as is hereinbefore provided with respect to the Bonds they represent, 8. That the proportion to which the Grovernment is en- titled of the moneys realized by the Trustees of the Land Grrant Bonds ; and after the redemption of the Land G-rant Bonds, the proceeds of all sales of Land granted or to be granted to the Company, under the contract, realized as provided by the said Act, shall be applied to the pay- ment of the interest and principal ef the said sum of 19,880,912. And after payment thereof in full, towards the payment to the Government of the interest and prin- cipal of the said sum of |20,000,000. 9. That the said Act of last Session (47th Victoria, Chap. 1), shall remain in force except in so far as it is affected by the provisions hereof 16. That if at any time any line connecting with the United States system of Railways shall be in course of construction to a point on the river St. Mary's, and there shall be a probability of the early completion thereof; and the Company shall desire to continue the Algoma Branch to a junction with such line ; the Governor in Council may, in their discretion, and upon such condi- tions as they shall determine, order the release and dis- charge of the said Brani'h from the lien and charge thereon created by the said Act, and continued by this Act, and may, by such order, authorize the Company to exercise in respect of the said Branch, the power of mortgaging the same in manner and form as provided by its charter with resjiect to mortgaging the main line thereof, to such ex- tent per mile as shall be fixed by such order, the proceeds of such Bonds to be applied exclusively to the construc- tion of the extension of the said Branch to such junction. loi' rith hey en- laiid rant be d as pay- n oi' ^ards priii- 3hap. ected 1 the rse oi' there ereof ; Igoma lor in condi- id dis- lereon jt, and cise in iig- the ii with leh ex- L'ooeeds nstruc' mction. . ^u^atraVV* •.-A^- — — \ 1 1 I ; Sandw ich U.a* ^'->>f ! ^ r t'VAmeriasn Is. iir» no Kin mo «5 0> I 4 i.'.rtr; » IiHi ros.'sf I. n.li I'o.sl : >» /« Vloiuir -V-;^ fi tKV.x-.IU"'.' V "oils,. ,«., -* V*- >-.. ; ll,.s>Vlll«' \ J-'-si^i^r-tr-^ir^. ^^-'^.^.'^fldbiy^^f'^i'^'V. Nu^°^.^:^^^^;VvA.^"-:^^ «^:.:*a " _ "^ T aA N \ a.; 'A J K -..-.-< V Ariu'i' ^. "Vi tin ■■••■■■- - ' » ^ J* 1 l»(.llllnl"'l .•IM c.u- ^N7i.< -.A-*: SI.-ii\i«->' .\\'.iii>U- 'm,•""' r/f / lUO V7 A^ ' — \4»i»f;«M*V' -r.--*»''"'^" ^' o 40 , ---,-0- oro«»- * *"* "" j A M K R t C A\j JO -^ ^ Sui. Kram?s<;(\ UNIT E"6 SiX\t^~ ^j'T-' "^.f'f " (7' ! O ; C ^ A -\' \\1 DESERT ar SAHARA A \y H r c; ,a%^>^ ' >•/ (:riit\«ll'''i U;v....l;-.l' llialMl 5-r .All. rU"" ■KlORTHCRN PACl" ,,\»1> .sV. Barn«S'^\,. , A V-\^\ I'lr. lo'lO"',", '■♦♦.V TV J Aslili M<">'' I'M ,M !• f \ - ( 1 Si '-irr^rrr- -z:^ no to. 5 10') MO 1' V^'^ .vV MAP or Part of the Dominion of Canada SHOWING THE THROJQH LINE Of THE AND ITS CONNECTIONS. _^*» A "•/X'rl llo r rj^-"' .,..? \ >:>, A^-.:-^ .^^-'- "•••'■ /■ >: Trrrir >- 3053^?I.^5- J 1 1 I .0/ 'A ^$'':^' vy ^ -.v' iV iHVi :^ '***», Y.J.. 1> A*/ / ►;f!f iH"'* / y >^' Af >'♦♦?/ »/«'//, 7* ^y w ' s\v>V ,^>^ .>«^ *.*• ^^. /■ ^^ / I '^r «•)•, 2^ .n'«' ,n< Atv v.W ^vi V', "*' fir ►^•j vV^S ^ 4^ "i'li oV*' ^M>^ "•/ .••^'<' ■j_\\S\ 1.-/1 *^-N^V ^-v^'-y*:**^' >-s'.. JK«ec^yo\ <:^' ,Vv i« ;a^-< >' \\^'i >, WMI' ^^ 'y. :<'Zf' ^•>.$^ l^""" ^^'3 >.,--.. S^//''^ ^<{^ \\\^ .^: m M* ^'/:'"^^. > "'H eie*^ o ii:f.-.V:)?' .^;v \\\ ;/> ^^oS .-(O' A^" >'* i m: .'Voy;-^ v.-lf^^ 'V ..r^ li^ ^);,. # "Si '. s ' . 1 vTest'n" k'tf^' Av-::^: '',( ,('/, T«'' IV M -./,<'>; >{^) '^: 7/ VJf X-i I i /A^ /Si •■'* o TABLE OF COMPARATIVE DISTANr.FQ Main L)ne- Montreal to Port Moodv. An Hail Route ' BTATUTt Mills. 2,895 3,155 , .-'r ' r-U,'- • -&' V - .-- F"OM Liverpool to San Fbancisco. \ , ' /'v , t^-' ^ J ,,■■'' -■' / K ■ ^'* shortest connecting lines in the r ^-^•^ ' : ; Q^vz-^-^/V^-'Vy United States, g, I v/V*^ I ' ^'\i ///'r'-' '^'lyY'" P"o«« LiwcrpooltoYokohamaCJapan) '•^iV V* 'l \ \ 1 I i ■ ■''y' / r \' ^'* '^°'*T'"*'- *'€ff»^ 762 .974 FnoM Liverpool to Yokohama 'Japan) VIA New York AND San Francisco, 11,990 '^..^L^MJS LiJil..: \ ■^Vi