I am willing to trust to the arbitrators, and particularly to the Government arbitrator, the Chief Justice of Ontario. But apart from that, no matter what any bank or pledgee may have loaned against the stock, that is no element in the determination of the value of the stock. But dt was,thought well that inasmuch as they had an interest in the stock, they should be made, with the owners, parties to the agreement, so that all would go before the arbitration board on an equal footing and have a right to be heard. The *pledgees may have advanced $1,000,000, $10,000,000, $20,000,000 or $100,000,000. That may have been their idea of a proper security at the time they advanced the money, but it has no relation whatever at this stage as to what the actual value of the stock may be. I agree with the horn, member for Calgary that'an agreement with the owners of the stock would be an agreement whereby we might determine the value of the stock without reference to anybody else. But it seems to me that it is a little better and a little fairer that all who are interested in this matter should become parties to this agreement, and have the opportunity of going before the Arbitration Board and presenting such evidence that is evidence, not evidence that is no evidence at all; evidence that goes to show value, not evidence that goes to show what they at one time thought they might safely loan against the stock.
The hon. member for Calgary proceeded to refer to some income convertible bonds which occupy a relationship to this company different from the other debentures held against the road.
It Is a fact, as the hon. member for Calgary says, that there exists outstanding $25,000,000 of bonds which are a charge upon the road, and that the holders of those $25,000,000 of bonds are entitled to interest on their bonds only if the earnings of the road warrant it. It is further provided in the body of the mortgage deed which secures these bonds, that the holders thereof may within a limited time exchange the bonds for common stock of the company, dollar for dollar. It is quite true that if this transaction goes through our becoming owners instead of Mackenzie and Mann does not in any way affect the position of the holders of the income convertible bonds. They occupy exactly the same relationship to the company before
this transaction, as they will occupy when the transaction is completed. Consequently, they would be entitled before the first day of January, 1919, if my hon. friend's date is correct, to go to the Canadian Northern Railway Company, which will still exist, and say: "We want shares of stock in lieu of our income convertible bonds." It may be wise to take into consideration in committee whether or not that right should be abolished. I do not consider it a very substantial right. I do not think there is the faintest possibility of their exercising it. What they have now is a bond against the railway, in preference to all the stock, and I do not think they will consider that under government ownership and operation, no matter what the Government may be, that stock is going to be of greater value than $25,000,000 of bonds before the first day of January, 1919. I do not think any man in. this country, or in any country on earth,, will before the first day of January, 1919, exchange $25,000,000 bonds of that road for $25,000,000 of the common stock.