The Thomas A. Edison Papers Digital Edition

Transcription

New York City. 
January 23, 1892. 
Dear Mr. Edison: 
As you are a Director of this Automatic Company, I feel that you ought to have a copy of this letter for your in-formation and for your own files. 
Very truly yours,  
S.B. Eaton 
[I have already given a copy to Mr. Insull] Law Offices 
44 Broad Street (Edison Building) 
New York. 
Jan. 23, 1892. 
Automatic Phonograph Exhibition Company, 
#15 Dey Street, New York City. 
Felix Gottschalk, Esq., President. 
Dear sir: 
Re Annual Report of your Company. Referring to your favors of the 19th and 20th inst., in regard to the issue of the stock of your company, I understand therefrom, and from an interview had this morning, by my representative, with your book-keeper, that the facts are as follows: 
I find that your books show that touching your present capital stock, namely, $2,500,000, divided into 25,000 shares of $100 each, nearly all of it, to wit, $2,499,300 or 24,993 shares, was issued in payment for the inventions, patents, interests and rights, re-lating to the coin slot phonographs, and that the remaining $700 of your capital stock, consisting of seven shares of $100 each, were issued to the following directors, namely: 
 
Charles A. Cheever…………… 2 shares 
Felix Gottschalk………………… 1 share 
T.T. Eckert, Jr……………………   1  “ 
Charles P. Bruch………………    1  “ 
Samuel Insull……………………    1  “ 
Jesse H. Lippincott……………    1  “ The above shares are charged to the gentlemen above named, upon your books, and it appears that the subscription of subscriptions of such seven shares, have never been paid by them. To make an exact statement, therefore, we must how in the present annual report, that the capital stock is all paid in. with the exception of the above seven shares. I have therefore drawn the annual report for 1892, to read as follows, in this regard, namely:
"FIRST:-That the capital stock of said corporation is two million five hundred thousand dollars ($2,500,000) and that the proportion actually paid in is two million four hundred and ninety nine thousand, three hundred dollars ($2,499,300) thereof, which was issued in payment for property purchased for the business of the company; and the remaining Seven hundred dollars ($700) was issued upon subscriptions therefor, which said subscriptions have not yet been paid."
Assuming that the above is a correct statement, I send you the form of proposed annual report, all ready for execution. I send two copies, in duplicate. Both copies should be signed by a majority of your Directors, and also sworn to by the President or Vice President, and Secretary or Treasurer, all in time to be filed before January 31st, in the Offices of Secretary of State and County Clerk. If you will kindly send me the copies when executed, I will have them filed, and will also send you a complete copy for your files.
I have obtained from the County Clerk's Office, a copy of the annual report, made by your Company in January 1891, and find it is stated therein, that the entire capital stock  was paid up, If the explanation of your bookkeeper, given to my representative today, is correct, the annual report of last year, was not in strict accordance with your records. I call your attention to this, so that you may correct me if I am wrong on these points. Evidently, your last report, was, what the law calls "false", and all the Directors who signed it, are possibly liable for the debts of the Company.
Much time has been lost by me today, owing to your absence, and the trouble, when you are away, of getting the exact facts.
Very truly yours,
S.B. Eaton