The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1872-07-18

next meeting of the board, 1t was found thai
the president had made no such report, and
the resolutions we're ignored. The first act o.
my administration was to deny and repudiats
any such transaction. By the direction Of the
board. caused suits to be brought against the
former officers and directors of the company
to secure the return of any bonds that had
passed out of the hands of the company iI
that transaction. Notices OF those suits were
served on Frederick Bush J. L. Neagle, J. J.
Patterson, q. H. Kimpton, Niles G. Parker
Joseph Crews, G. W. Waterman, F. L. Cardozc
and T. Hurley. There were s596,OOO of second
mortgage bonds Issued by the executive
committee without any consideration being
received by the company. That whole
amount did moi 20 to the Continental Telegraph
Company. Kimpton himself and half dozer
other directors told me 100000 Of boLds was
paid for that charter. Then there is found on
the minutes of the board authority to borrow
$50, 900 from jill. Neagle, and give him $780,
600 of bonds for 1t at 338 cents. Those boEds
went to Neagle, but the money never ce.ne
into the treasury. do not know OF my OWL
knowledge how much money was used to
bribe the Legislature, but have been told by
! various directors. AS to the 5000, 900 of bonds
held by the Commercial Warehouse Company
there is no record on the books Of any direct
communication between that company and the
railroad company for any loan of money, and
T know Of the pretended connection only
through their own statement or demand upon
US. The notes held by that company are
signed by John j. Patterson as vlce-presldent.
There is no evidence Of any authority
conferred upon Patterson to negotiate such
loan nor of giving him bonds to secure such
loan. The records show authority TO fur.
nish Kimpton with bonds, but only for speci'
fed objects, and principally for the purchase
of supplies. There were bonds In Kimpton's
hands in New York, but not In the hands 6i
anybody else in New York that know OF, ex-
cept few small amounts as security for loco.
motives. If money were raised by the Com.
merclal Warehouse Company suppose it has
gone to Kimpton, but do not know that. OF
the $780, 900 of second mortgage bonds there
are sl,ls6,000 out concerning the issue OF
which there is no record In the company. The
rate of interest to be charged by the CONNER
cial Warehouse Company appears In their de-
maud as th!rty-seven per cent. The bonds In
their hands were sold recently, and brought
twenty-five TO twenty.nine and q half
cents. There are two ways of estimating
the value of railroad. Its In
trlnsic value Is represented by the
cost of Its construction; lls exchange
able value depends upon what Is is worth In
the estimation of others. II the ownership or
control of road Is desired by two or more
corporations, that competition tends to en-
hance It's value. The development of the re-
sources OF the country, the multiplication OF
travel and the Increase of population also
increase the value of road. In speaking of
the value OF railroad do not mean what it
cost the Stockholders, but what 1t is worth In
the market. 1 did not intend to convey In
my annual report the idea that the GreenVllle
and Columbia Railroad was insolvent. / be-
lIeve it is very far from being insolvent. The
Air Line Railroad Is likely to be beneficial
rather tnan otherwise to the Greenville Road
1t can hurt 1t only at Spsrtanburg and Green
Vile, and at these points more In the re.
ductlon of rates than In the dimnutlon of
tonnage. On the other hand, it Will divert
from the Georgia Railroad and the City of Au-
gusta all the freight coming from Atlanta and
other points west VI Augusta TO Columbia,
&C., because thet ls several miles. shorter.
have been connected with railroads twenty
ak yeare, and the president OF the South
Carolina Road ten years. | have often OBJ
served The capacity Of railroad to extrloate
Itself from embarrassments. The case OF the
When first became connected with 1t Its ln
come did not exceed S600,000, it's debt was
large, and ils stock low. In 1859, thirteen
wears afterWard, Its Income was over 81 ,6OO,-
600, aud its stock at par. Just after the war
Its position was much more hopeless than the
Greenvie Road Is now. Ninety miles OF It's
track had been completely destroyed, and
the rest of the road and equipment
was In a very bad condition. The
frat mortgage debt Increased twenty
per cent. by our Inability to pay
gold during the war; had matured, and
It's business had been entirely diverted except
the purely local traffic. Since then 1t has
been built up, until now 1t Ia nearly equal 10
Road has now good operating capacity.
What ls required to bring IL Into prorer con-
dItion In all respects Is an expenditure Of
1000 per year for the next tour or i've years.
That would be quite sufficient. As 10 the
5000 900 being required at once to repair the
road. the engineers could not spend that
amount on the road ii you gave them the
money. The present condition, material, bu.
slness and profits of the road show that the
earnings OF The road would furnish q sufficient
margin after paying all ordinary expenses,
and the Interest on all the acknowl lodged debt,
to put and keep the road In good condition.
ts'income for 1870 being s439, ,34l SO, for 1871
$457, IA and for 1872 $500, 600, that Is suf1-
cient data for the expectation that It
will steadily increase, except perhaps
for one year after the completion OF the
Air Line Road, when It's increase may
be temporarily disturbed. II It's bonded debt
should be Increased to $4,000, 900, the road
could still carry that and keep its track IN re-
pair, and its equipments adequate for the
transaction of business. When we took con-
troll of the road, We found it utterly diVesteG
of all present means aud resources to pay In.
terest and do other things necessary tor the
road. The difficulties, however, were not
hopeless, and only required Time to enable
the company to retrieve Its condltlon. FROM
the opportunities I have now had to under.
stand the condition of the road, conclude
that we will be able to resume the payment OF
interest on or before the lst Of next January.
The road came under the control OF President
Bush and his board In April, 1870. and 30 con-
tinued until the 5th of January, 1872. There
has never been any Intent In any payments by
the company 10 prefer any one creditor over