of eighty-five years the work to revert to the State free from all indemnity for the capital invested; the Company, nevertheless, to receive fifteen per cent. annually of the net profits, for ten years thereafter, if the entire cost shall not exceed twenty million dollars; but if it does exceed that sum, then it shall receive the same per centage for twenty years thereafter.

4th. The Company to pay to the State ten thousand dollars upon the ratification of the contract, and ten thousand dollars annually until the completion of the work; also to give to the State two hundred thousand dollars' worth of stock in the Canal, upon the issue of stock; the State to have the privilege of taking five hundred thousand dollars of stock in the enter prise; to receive for the first twenty years, twenty per cent. annually out of the net profits of the Canal, after deducting the interest on the capital actually invested, at the rate of seven per cent.; and also to receive twenty-five per cent. thereafter, until the expiration of the Grant.

5th. The Company to have the exclusive right of navigating the interior waters of the State by steam, and the privilege, within the twelve years allowed for constructing the Canal, of opening any land or other route, or means of transit or conveyance across the State; in consideration of which, the Company shall pay, irrespective of interest, ten per cent. of the net profits of such transit to the State, and transport, both on such route, and on the Canal, when finished, the officers of the

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Government and its employees, when required to do so, free

of charge.

6th. The Canal to be open to the vessels of all nations, subject only to certain fixed and uniform rates of toll, to be established by the Company, with the sanction of the State, graduated to induce the largest and most extended business by this route; these rates not to be altered without six months previous notice, both in Nicaragua and the United States.

7th. The Contract, and the rights and privileges conceded by it, to be held inalienably by the individuals composing the Company

8th. All disputes to be settled by referees or commissioners to be appointed in a specified manner

9th. All machinery and other articles introduced into the State for the use of the Company, to enter free of duty; and all persons in its employ to enjoy all the privileges of citizens, without being subjected to taxation or military service.

10th. The State concedes to the Company, for purposes of colonization, eight sections of land on the line of the Canal in the valley of the River San Juan, each six miles square, and at least three miles apart; with the right of alienating the same, under certain reservations; all settlers on these lands to be subject to the laws of the country, being, however, exempt for ten years from all taxes, and also from all public service, as soon as each colony shall contain fifty settlers.

11th. It is expressly stipulated, that the citizens, vessels, products, and manufactures of all nations shall be permitted to pass upon the proposed Canal through the territories of Nicaragua subject to no other, nor higher duties, charges, or taxes than shall be imposed upon those of the United States; provided always that such nations shall first enter into the same treaty-stipulations and guarantees, respecting said Canal, as may be entered into between the State of Nicaragua and the United States.

Such are the provisions of the Charter, and as we now tread upon the threshold of new and thickening events, let us cautiously survey them, ere the fogs of bigotry and clouds. of dissension have arisen to dim the horizon.

The acquisition of California in 1848 by the United States, the disclosure of its vast mineral wealth, its consequent political organization, and social development, precipitated upon the world the solution of a communication across the Isthmus, and such a passage, however desirable to other nations, became doubly so to the United States, for the purposes of commerce and defense. With our sympathies, we had extended the Spanish American States favorable commercial treaties.

In 1823, was announced the postulate of President Monroe."The American Continents, by the free and independent condition which they have assumed and maintained, are henceforth not to be considered subjects for further colonization by

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any European power." The United States declined to interfere in the political affairs of the Spanish States, though frequently invoked to do so. Dawn was breaking in this benighted region, and new life, with young, and healthy blood was about being infused into the decrepit Asiatic branches, who, though richer, and more imperial, had been outstripped in the race. The Isthmus was about to be opened; the youngest family on this Continent had assumed a position where its voice commanded, and its skill directed the noble enterprise.

Three routes, each rivals for preferment, presented themselves; the Tehuantepec, in Mexico-the subject before us, the Transit in Nicaragua-and the Chagres Route, in New Granada. The United States essayed to open them all. The Charter alluded to in our chapter, proposes, in Section Eleventh thereof, equal terms to all nations who should enter, of course, into the same stipulations and guarantees as should be agreed upon by the United States and Nicaragua. Still did we hesitate, owing probably to the presence and intervention of Great Britain in Central America.

During Spain's dominion on the Continents, she excluded foreign powers from commercial intercourse with her colonies. Between them and those of the British, contraband trade grew up, wars ensued, and when peace was declared, Great Britain possessed two settlements: the Belize or British Honduras, in the department of Yucatan, and the Mosquito Coast in Nica

ragua-their title to both, disputed by the Central American States. The Agent of Great Britain announced to Honduras and Nicaragua the determination of England to sustain her protectorate on the Mosquito Coast, (September 10, 1847,) from Cape Honduras to, and including the lower part of the Rio San Juan. (Vide Ex. Doc. 75, p. 44, Vol. X., 1st Sess. 31st Cong.)

Subsequently, on the 8th of February, 1848, two English ships of war arrived at San Juan del Norte, or Greytown, expelled the State officers of Nicaragua therefrom, and four days afterward proceeding up the Rio San Juan, took the fort at Serapaqui, after a determined resistance on the part of Nicaragua, the latter having succumbed under protest, on the 17th of March, 1848. In October, 1849, an English man-of-war captured Tigre Island, belonging to Nicaragua, off the Pacific coast, together with the Island of Ruatan or Roatan, belonging to Honduras, commanding an unexcelled position for protecting or molesting every passage between the oceans. Capable of being admirably fortified at a small expense, it invited the rapacity of her English foe. Costa Rica, the late ally of Nicaragua, disputed with the latter the boundary of the Rio San Juan, and claiming the southern portion of Lake Nicaragua, seemed, in this struggle, to favor Great Britain. Honduras and Nicaragua

implored the aid of the United States.