[372] Chron. 55:938, 1892.
[373] Chron. 55:1078, 1892. For replies of defendants see Chron. 56:414, 1893, and Ibid. 972, 1893.
[374] This was the letter finally declining to undertake the reorganization in 1892 because of lack of assurances of support.
[375] The correspondence appears in full in Chron. 56:207, 1893, and Ibid. 56:622, 1893.
[376] Ry. Rev. 33:95, 1893.
[377] These needs had already been emphasized by the Olcott plan.
[378] Lack of space forbids a full statement of the criticisms which the Drexel plan had to make upon the physical condition and financial practice of the Richmond Terminal properties. The following is from the plan, section 9: “As an example of the manner in which accounts have been kept, it may be mentioned that in the operating expenses of the entire Richmond & Danville system only $20,000 were charged for renewal of rails in the fiscal year ending June 30, 1890, and not a dollar in the fiscal years ending June 30, 1891 and 1892, respectively. In seven months under the receivership (July, 1892, to January, 1893, inclusive) about $600 were charged. Since that date, it is understood, about $18,000 have been charged. With these exceptions all renewals of rails were charged to construction accounts. Renewals, properly to be included in operating expenses, would be at least $100,000 to $150,000 per annum.” Other instances, almost as bad, could be stated.
| Total cash requirements, as estimated, were: | ||
| Floating debt, including equipment notes | $12,900,000 | |
| New construction and equipment during two years | 8,000,000 | |
| Expenses of reorganization and contingencies | 2,350,000 | |
| $23,250,000 | ||
| To be provided from: | ||
| Assessments on Terminal stock | $8,750,000 | |
| Assessments on East Tennessee stocks | 2,700,000 | |
| Sale of $33,333,000 new common stock | 5,000,000 | |
| Sale of $8,000,000 new bonds | 6,800,000 | |
| $23,250,000 |
[380] The new company reserved the right at any time to redeem its preferred stock in cash at par.