25 6 POPULAR SCIENCE MONTHLY. 



the time of completion to October 31, 1910. The validity of this last 

 extension of time has been questioned. 



A new company, commonly known as the new Panama Canal Com- 

 pany, was organized on October 20, 1894, with a capital stock of 650,- 

 000 shares of 100 francs each. Under the provisions of the agreement 

 of December 26, 1890, authorizing an extension of time for the con- 

 struction of the canal, 50,000 shares passed as full paid stock to the 

 Colombian Government, leaving the actual working capital of the new 

 Panama Company at 60,000,000 francs, that amount having been sub- 

 scribed in cash. The most of this capital stock was subscribed for by 

 certain loan associations, administrators, contractors and others against 

 whom suits had been brought in consequence of the financial difficul- 

 ties of the old company, it having been charged, in the scandals attend- 

 ing bankruptcy proceedings, that they had profited illegally. Those 

 suits were discontinued under agreements to subscribe by the parties 

 interested to the capital stock of the new company. The sums thus 

 obtained constituted more than two thirds of the 60,000,000 francs 

 remaining of the share capital of the new company after the Colombian 

 Government received its 50,000 shares. The old company had raised by 

 the sale of stock and bonds not far from $246,000,000, and the number 

 of persons holding the securities thus sold has been estimated at over 

 200,000. 



The Panama Eailroad Company holds a concession from the Colom- 

 bian Government, giving it rights prior to those of the Wyse Concession, 

 so that the latter could not become effective without the concurrence of 

 the Panama Eailroad Company. This is shown by the language of 

 Article III. of the Wyse Concession, which reads as follows: 



If the line of the canal to be constructed from sea to sea should pass to the 

 west and to the north of the imaginary straight line which joins Cape Tiburon 

 with Garachine Point the grantees must enter into some amicable arrangement 

 with the Panama Railroad Company or pay an indemnity, which shall be estab- 

 lished in accordance with the provisions of law 46 of August 16, 1867, ' approv- 

 ing the contract celebration on July 5, 1867, reformatory of the contract of 

 April 15, 1850, for the construction of an iron railroad from one ocean to the 

 other through the Isthmus of Panama.' 



It became necessary therefore in order to control this feature of the 

 situation for the old Panama Company to secure at least a majority 

 of the stock of the Panama Railroad Company. As a matter of fact 

 the old Panama Canal Company purchased nearly 69,000 out of the 

 70,000 shares of the Panama Railroad Company, each such share hav- 

 ing a par value of $100. These shares of Panama railroad stock are 

 now held in trust for the benefit of the new Panama Canal Company. 

 A part of the expenditures of the old company therefore covered the 

 cost of the Panama Railroad Company's shares, now held in trust for 

 the benefit of the new company. 



