The receivers and managers carried out their part of the work first. Application was made in March, and again in June, for permission to issue certificates in settlement of the most urgent claims. In May Mr. McLeod resigned the presidency of the Boston & Maine after a large part of the Reading’s holdings had been sold, and the same month President Harris inaugurated a policy of retrenchment by the retirement of four out of the five vice-presidents which the Reading had been accustomed to maintain. In July the receivers obtained permission to dissolve the agreement with the Pennsylvania, Poughkeepsie & Boston Railroad, and in August the appointment of a separate receiver for the Philadelphia, Reading & New England marked, except for the minor matter of the Poughkeepsie Bridge, the final abandonment of New England extension. Meanwhile an arrangement had been made with the Lehigh Valley, whereby the payments under the lease were reduced for two years from 7 per cent to 5 per cent, on condition that the Reading should make extra payments at the end of that time if the Lehigh proved to have earned more than 10 per cent in the interval; and permission had been obtained from the Circuit Court to surrender the possession and operation of the Eastern & Amboy Railroad and the Lehigh Valley Terminal Railroad, both lines belonging to the Lehigh Valley in the state of New Jersey. The Lehigh lease, even as modified, aroused much opposition from bondholders, who rightly maintained that payments under it constituted a diversion of funds which should have gone to the creditors of the Reading proper. Suit was begun before the Circuit Court, and on August 8, 1893, a formal abrogation was obtained. This incidentally caused the resignation of Mr. Wilbur, president of the Lehigh Valley, from his position as receiver of the Reading, and the appointment of Mr. J. Lowber Welsh in his place. The more complicated task of the bondholders was at first undertaken by two committees: one for the general mortgage bondholders, of which Mr. J. Edward Simmons was chairman; and one for the income bondholders, led by Mr. George Coppell. Three demands were at once made: first, that Mr. McLeod retire from the receivership; second, that the lease of the Lehigh Valley be abrogated; and third, that the books of the company be examined by a railroad accountant. The first and second points were complied with, though not altogether because of the insistence of the committees, and in the end the third was also granted, and Mr. Stephen Little was set to work.[256]