The Findlay Jeffersonian. [volume] (Findlay, Hancock County, Ohio) 1870-1881, 1876-07-14

May of each year, out of the net earn
ings of the company for each year eho-
ing on the 3lst day of December pre-
vious to such LIST day of May, afte;
satisfying the interest on the bonds
and contributions to its sinking tund-
But, in violation of this contract
with the preferred stockholder EN-
bodied in his certificate of stock, and
of the provisions of the second mort
gage, which determined the priorities
of the various securities of the compa-
nv subsequent to the first mortgage,
the Directors of the company have is
sued this equipment bond, and they
are recognizing the coupons as having
priority over the preferred stock as a
lien upon the net earnings of the com
pany.
COSTLY FINANCIAL OPERATION FOR
THE COMPANY
This report gives the following ac-
count of some financial operations
which cost the company considerable
in the shape of large difference in
interest:
1--WE also learn from the accounts of
the Company certain facts in regard to
the issue of these equipment bonds,
which may be of interest, if they are
not of importance, to the stockholders
of the Company. From an account
recently stated to the Company by Mr..
Russell Sage. it appears that between
the 20th of June, and the 10th of De-
cenber, 1886, the President of the
Company, Mr.. Butler, paid over TO
him $40, 462 50, the proceeds, as we
suppose, of the 5000 600 equipment
bonds. On the 2Sth of December,
1870, disappears by Mr.. Sage's account,
this money had all been paid out for
equipment, except the sum of S19, 600,
which had been repaid TO Mr.. Butler,
the President of the company, and the
balance of S47, 291 IS, which remained
in Mr.. Sage's hands. The whole of
this last balance remained in Mr. Sage's
hands year, and some portions of it
for more than two years, the average
being a year and four months; so that
this sum of money (S47, ,291 So re-
manned in Mr.. Sage's hands a year and
third, upon which he allowed inter
est at per cent, while the company
was paying IL per cent for it in the
shape of coupons upon the equipment
bonds"
THE CONSTRUCTION OF THE BELLE
WILLIE & SOUTHERN ILLINOIS RAIL
ROAD.
The St. Louis, Alton d Terre Houte
road was leased in 1867 by Tilden and
his associates tor ninety-nine years to
the Indianapolis & ST. Lous Railroad
Company, at an annual retail of 30per
cent. OF the gross earnings, with pro-
yiso that IN no one year should the
rental amount TO less than $3.50, 600.
This lease was guaranteed conformity
by the Pittsburg, Fort Wayne and
Chicago; Cleveland, Columbus g. Gin
cinnati; Cleveland, Painesville & Ash
tabula, and Indianapolis, Cincinnati g.
Lafayette Companies. When the lease
was made, the st. Louis, Alton & Terre
Haute Company retained the BeIleville
Branch, and at some time either prior
To or after the lease, Tilden & Co. con-
structed road So miles long, from
Balleville to Dequoin, which is known
as the Beileville and Southern Illinois
Railroad.
On this road bonds to the amount of
81, 100, 600 were issued, it is reported,
were taken by the Directors, some
where in so. They finally leased this
new road, in an undeveloped country
and without any rolling stock upon it
10 the st. Louis, Alton and Terre Haute
Company, for 40 per cent. of :he gross
earnings. The equipment bonds above
alluded to were issued to stock this
new road.
ANOTHER LARGE DIVISION.
TIa e a..
Alton & Terre Haute stockholders in
1873 hunted in the archives of the Illi-
nois Railroad Commissioners for some
particulars in regard to the organiga-
tion of the BclIeviIle g. Southern ILL
nois road, and could obtain very little
information, and Poor's Manual, the
recognized railroad authority of Amer
lea, has scarcely given any account for
years; but in the last volume We find
that in addition to the 81, 100. 600
bonds, the capital of the company is
set down at 81, CSC, 900. 1t can not be
learned whether anything was ever
paid for this stock, and the general
presumption is that it was divided
gratutiously among the Directors who
built the road and leased it TO the st.
Louis, Terre Haute & Alton. 1t is
stated that the lease of the BelleviIle
and Southern Illinois at forty per cent.
of the gross earnings, causes a loss
every year to the lessee, the st. Louis,
Alton and Terre Haute Company, esti-
mated at about twenty per cent.
Among the parties who constructed
the Belleville and Southern Illinois |
road, and afterward leased it to the |
unfortunate st. Louis, Terre Haute & |
Alton Company, were Mr.. Samuel J.
Tilden and four others of the Trustees /
OF that company. As to the propriety |
OF their acting in this dual capacity, /
the reader may be safely left to Judge
Tor himself. Whit is thought of it by
the committee of the st. Louis, Alton
q Terre Haute Stockholders is defin-
ltely stated in the following para
graphs, which We clip from their re-
port:
THE LKAsE OF THE BELLEvILLE l.
SOUTHERN ILLINOIS ROAD.
The lease of the BelIeviIle & Soutb-
ern Illinois road does not compare fa-
vorably as business transaction with
the lease OF the main line. The same
persons who leased to the Indianap-
Oils d St Louis Company the main
line OF the Terre Haute road, which
was an old road, equipped, fenced,
with stafion-houses, and a developed
local business, for 80 per cent. of the
gross earnings and the taxes, have
leased the road of the Belleville s.
southern Illinois Compdny-a road
without any equipment, without a
station-house or a fence, with an en-
tireiy new and undeveloped business
Tor 4O per cent. of the gross earnings
and the taxes.
MISLEADING REPORTS.
THE annual reports of the comma.
ny are misleading with regard To the
profits derived from the BeIIeyiIle and
southern Illinois business, for the
reason that, in calculating the expenses
OF the business, no charge is made for
the amount expended in construction
on the Southern Illinois extension, nor
Tor the interest upon the three hum
dred thousand equipment bonds, both
OF which things are items of expense
incurred by the Terre Haute COMPANY
In doing Southern Illinois business
under the lease. Taking the accounts
as they actually stand in the animal
statements for the last three wears
and, making up the calculation prom
erly, it appears that the Southern Ilii-
nols lease has thus far been a matter
OF considerable loss to the Terre Haute
Company.
A SURPRISED COMMITTEE.