Knoxville daily chronicle. [volume] (Knoxville, Tenn.) 1870-1882, 1879-12-06
Our Goods are always sold
at the Lowest Prices.

to meet the interest upon the coupons Of
the former Company.
And the East Tenn, Va. & Ga. Railroad
Company takes an engagement upon itself
to supply this deficiency for a term of three
(3) years from the date of the proposed
amendments to the lease.
Under the provision of these amend
ments, the coupons CT the Memphis and
Charleston Railroad Company are to be
bought and held by the East Tenn. Va. &
Ga. Railroad Company, asia subsisting
lien, and due Indebtedness against the
Memphis and Charleston Railroad Com
pany.
It will be optionary with the East Tenn,
Va. & GA. Railroad Company, after three
(3) years, to elect whether it will continue 10
buy the coupons, or surrender the lease.
AS to the probable deficit which may
from time TO time occur in the net pro-
ceeds of the Memphis and Charleston
Road required to meet its annual interest,
it is proper to state that it is hoped that
these will not be-very large; that is if only
the ordinary wear and tear of the Road is
replaced; but if it is the intention of your
Company to keep the property for the full
term of the lease-say Tor eighteen Q8)
years from the first Of July last-it is be-
lieved that it would be wise policy to re-
store the physical condition of the Mem
phis and Charleston Road more rapidly
than its earnings will provide for, by
making temporary advances to that Com
pany, as you have right to, under the
lease, to the end that that Road may be put
in such condition as to render it practicable
efficiently to operate it at the lowest possible
outlay; and thus secure large business
over il with which to feed your line. Just
how rapidly these advances should be made
or to what extent they will become neces-
sary, we will not now undertake to say !;
but, we deem it proper to state, that, in
our opinion, the road should be put in
good order within two or three years, at
the most, for, until this is done, neither it
nor your own road can hope to reap the
benefit to which you are entitled by the
unifcation of the interests sought to be es-
tablished under the lease.
The proposed amendment to the lease,
duly executed by the Memphis and Char
lesion Railroad Company, is herewith SUBJ
mitted to you, and your Board of Directors
recommend its acceptance by your Com
pany.
Your Board regrets to be compelled to
report that the holders of Tennessee bonds,
issued to this Company under the Internal
Improvement Law of the State of Ten>
nessee, have brought suit against it, in
which it is sought to charge upon this
Company the payment of the interest upon
the outstanding Tennessee bonds.
Ihe hrm OF Messrs. EVarts, Southmayd
s. Choate, of New York, JAS. Z. and Jno.
Shields, of Beams Station. Tennessee. and
our counsel, the Hon. Geo. Brown, have
been employed to defend, which they all
advise can certainly be successfully done.
They do not believe that the Tennessee
bondholders have the slightest grounds
upon which to hope for recovery; never
theless, it is not to be denied that this is an
expensive and troublesome litigation,
which may drag along for several years
to come; but, in the end, our counsel feel
absolutely certain of SUCCESS. The amount
sued upon is not very large, but complain
ants bill provides that all holders of bonds
similarly situated may join as Cocoon
plainants, according to the Comptroller's
report (Which we do not, however, admit).
It is stated that the amount of bonds out
standing, which were issued to the Com
panies now consolidated into the present
Company, aggregate about $4,000, 600.
About $400, COO of this amount were issued
under other acts than that of 18th of Feb
ruary. 1852, and amendments, known as
the Internal Improvement Act.
On the first day of July, 1880, S327, 600
of the six per cent. bonds of the East Ten
nessee and Georgia Division, mature, and
will have to be provided for, and it will
therefore be necessary for this Conv ention
of Stockholders to confer the requisite
power therefor upon your Board of
Directors.
Respectfully submitted,
Z. T. WILSON, President.