The Sun.
London, England, 1866-10-11 00:00:00

10,324 1 0

Paid to debenturo
holders
.Interest, &c., on tempo-
rary loans 1,364 393 3
Deficiencies on Revenue Accounts :
Genera.) undertaking,
1865
ditto 1866 274,165 17 6

357,955 8 8

339,660 11 3

Metropolitan Exten-
sions 41,399 5 6

381,059 16 9

6,057,804 4 0
2. The committee, page 14, charge the directors with
leasing and working other railways " regardless of the
sufficiency of the company's net revenue to bear anrconse-
^quent loss."
3. The committee, pages 13 and 15, make strong charges
in respect of the manner in which subscription contracts
have been entered into previously to obtaining the certifi-
cates of the magistrates for authorising the exercise of the
borrowing powers.
The directors are assured that in every instance the sub-
scription contracts have been entered into in the usual way,
and it is the fact that in every instance, excepting that of
the eastern section, shortly to be alluded to, the share ca-
pital has been fully created and issued either to the con-
tractors or the public.
It is true much of this capital having been taken by the
contractors as the consideration for executing the works
was by.them issued at a discount, from the fact that in no
other way could holders have been found. The issuing at
a discount was matter of regret, but also a matter of neces-
sity, and the directors altogether deny the charge made by
the committee of intentionally evading or violating the
Parliamentary powers—a charge based upon the supposi-
tion that share capital, whatever its real value, can only be
issued at par.
The debenture debt comprises a capital of £4,295,230.

(Report, page 51.) The debenture-holders have the security
of £10,625,498 actually expended on the line and works,
irrespective of the £6,047,804 further capital before alluded
to. Even on the showing of the committee the debentures
ars backed by the security in share capital, fully laid out
of more than the 50 per cent. contemplated by Parliament.
As respects the Eastern Section, Sir Morton Peto and
other parties subscribed the amount, and undertook in re-
spect of it to construct the lines for which the capital was
raised, and were largely in advance to the company. The
failure of that firm occurring the works have been sus-
pended, and Sir Morton Peto and Co., into whose names the
shares have been transferred, seeing their inability to
complete the contract, executed the transfer to ono of the
directors and the secretary of the company, in order that
they might, so far as in their power, repair the injury
which would result from the non-completion of the
works.
The receipts set forth in page 16 of the Report merely
record the fact of Sir Morton Peto and Co.'s subscription
and payments upon the shares and the obligations under
which that firm lie to construct the works in respect of
which they held the shares.
4.—The Over-Issue of Debentures.
This matter was fully explained to the general meeting
of shareholders on the 31st of August, 1866.
The directors, in reply to the charge of the committee,
that the transaction " was altogether unjustifiable," can
only repeat that the transaction would have been perfectly
regular if the money intrusted to Sir Morton Peto and Co.
for the purpose of retrieving the pledged debentures bad
been duly applied to that purpose, and. the directors submit
whether they were net justified in anticipating that the