Bankruptcy and Sale

Their loans over time were all secured with their lands and buildings, but in 1842 SMC had to restructure their debt secured by property that included $20,000 due to the heirs of John Savage, $5,500 due to the Bank of Baltimore, $15,000 to Mosher and Williams on behalf of Henry Watson, and $10,000 to William C. Shaw and others. The debt was to be paid in full, with interest, at the end of 4 years with appropriately timed payments.  If payment was not made in full then the loan will have been defaulted and the property could be sold to pay for the debt.  But more difficult times were to come.

While the furnace was being constructed in 1839, Amos became seriously ill that June, characterized as:

“afflicted with sickness, which entirely disqualified him from attending to business of any kind, and that he remained in this condition until the fall of 1844, when he was restored to health in mind and body.”

During his illness, creditors came calling when the loans were due, but after Amos recovered and discovered the financial results of the investments in expanding the manufacturing operations, he accused his brothers of forcing his insolvency due to to his illness.  He said his brothers were envious of his success and asked those creditors to bring suit against Amos and the company interests.  Amos was so convinced his brothers did him wrong, in 1848 he filed suit against them through the company that would reveal its inner workings but provide no real satisfaction for anyone. The court actions lasted until 1851 when it was too late to save the company from eventual bankruptcy.  The weakness shown during Amos’ law suit and subsequent appeal indicated the days of the Williams family ownership of the Company were coming to an end.

In 1853 they could no longer stave off bankruptcy as George Rundle files a lawsuit on behalf of the John Savage family to finally collect on the principal of $20,000 loaned to SMC 30 years earlier.  This made good on the 1842 restructuring of the debt and threats of foreclosure for non-payment and the Company was ordered to sell the property and pay off its debts (Chancery Court order?).   SMC started to liquidate cotton manufacturing machinery and soon offered to sell various parcels of their land and water power, without affecting the main operation of the factory.  It would be hard to find a buyer at a decent price if there was no operating factory and no water power to turn the water wheel.

The definitive sale of the Savage Manufacturing Company occurred through a public auction occurred through a public auction on September 15, 1859, when it was acquired by William H. Baldwin Jr. for $42,000.  The formal transfer of the property from George H. Williams, as Trustee (George Williams oldest son) was completed via deed dated March 15, 1861.