New York, N. Y., February 28, 1929.

To THE Stockholders of the

HUDSON & MANHATTAN RAILROAD COMPANY:

The following report for the year ended December 31, 1928, Is submitted:

The regular semi-annual payments of dividends were made, at the rate of S% per
annum on the preferred capital stock and 2;^% per annum on the common capital stock.

The work of reconstructing and enlarging the station at Journal Square, Jersey City,
has progressed to a stage permitting the partial use of the new work and from time to
time as additional portions of the structure are ready they will be put in operation. The
work proceeds relatively slowly due to the necessity for maintaining safe and uninter¬
rupted train service through the station while the old structure is being partially removed
and reconstructed and the new portions added.

The twenty new cars ordered in November, 1927, were received in August, 1928, and
placed in service.

In the report for the year 1927 mention was made of the opening of the Holland
(vehicular) Tunnels on November 12, 1927, and the inauguration of a line of passenger
buses, via these tunnels, between Jersey City and two terminals in New York City.
Various other passenger bus lines between points in New Jersey and New York City
have since started operation. Some of these buses use the ferries to cross the Hudson
River and others use the Holland Tunnels. While the owners of the bus lines oper¬
ating between New Jersey and New York do not make reports to the public authorities
as to the number of passengers transported, your Company has made periodic checks
of this traffic which indicates that the total number of passengers handled is between
5,000,000 and 6,000,000 per annum. The traffic of Hudson & Manhattan Railroad Com¬
pany decreased 1,352,707 passengers in 1928 compared with 1927, and this decrease is
largely attributable to the competition afforded by the buses.

In 1920 an agreement was entered into with the New York Edison Company to sup¬
ply the electric power required in the operation of the Hudson & Manhattan Railroad.
Effective January 1, 1929, this contract was terminated and a new and more advantage¬
ous agreement with the New York Edison Company entered into.

The tunnels, stations, structures, plants and equipments have been, as heretofore,
maintained at a high state of efficiency.
 

By order of the Board of Directors.

OREN ROOT,

President.