The Caucasian. (Clinton, N.C.) 188?-1913, 1897-10-28

amount of $4,000, 900, of which
amount the only items that formed
substantial basis aud bona fde in
vestment consisted of the said origi-
nal investment of $I50,0OO In the
year 1851, and tho pur chase, as
aforesaid, OF the said 'Bcownville
Line, Of the value of only $75 600
the re remainder of the six millions Of
stock representing nothing of value,
and being known as 'watered stock
That in the year 1868, the COM
plainant purchased other telegraph
lines whose actual value, as the de-
PENDANTS are inf f,rmed and believe,
was less than $l50,00O, and paid the
same by issuing therefor 1922 900 Of
its capital stock, and IN the same
year declared stock dividends, with
out any basis therefor, amounting
to 81, ,G79 900, thus increasing the
capital stock to sl1 ,0OO, 900, and soon
thereafter, and during the year 1864
without its stockholders having paid
into its treasury any further sum
of money, or without any other prop
erty or other thing of value having
been purchased as a basis therefor,
it declared stock dividends to the
amount Of $ll 900 900, thus increas-
ed the capital stock to 500, 900, 900.
That in the year 1856 the com
plainant purch hased the United States
Telegraph Company worth at the
time only ST. ,443 900, and paid there
fore by issuing $7.2l6,3 Of it's cap
ital stock, and also purchased the
American Telegraph Company.
worth at the time only 81 800 900,
and paid therefor by issuing $l1,-
S33, 100 of its capital stock, and thus
increased its capital stock to the ag
gregate amount of SAL, ,O49 400, and
soon thereafter another stock divi-
dend was declared without anv basis
therefor, to the amount of So, ,O6O,-
900. A purchase was then made OF
the American Union and Atlantic
and Pacific companies, worth about
S., ,232 900, for which account the
ca pital stock Of the complainant was
added to the sum of $19 ,OSO, 900. and
Immediately another stock dividend,
without any basis therefor, was de-
clared, in the sum of $l5, ,O00,O 900,
thus increasing it's capital stock in
the year 1895 to $95, ,O00,O and on
the first day in January, 1897, the
complainant declared to the defend.
ants herein, that its capital stock
was $97, $40 900. Thus showing as
defendants allege, over $6O, 900, ,OOt
representing less than Sic, 600, 90 of
actual value and more than $37, ;
100000 of other stock representing a
value not ascertainable in detail
consisting chic fly of stock dividends,
issued with no basis in actual values
That the total actual expenditure
of the said complainan from
its organization of money de-
rived otherwise than from its
bonds will not exceed Sic. .OOO.-
600. That it has issued from
time to time, and has outstanding
$l5, ,OOO, 900 of bonds which added to
the aforesaid SIG 900 900, would make
total of $3l 100000. That as de-
PENDANTS are informed and believe
many of the lines purchased herein.
before set forth were utterly worth
less duplicates, built solely to be
bought eff by the complainant, and
in some of which many of its off Ger!
and directors WI re largely concernesa
so that they were personally inte.'
ested in selling at exhor orbitant prices
and that nearly all of. said lines are
) much deprecated in value. Tha
, complainant pretends, that it owns
5 and operates 100000 miles of line
= 500, 900 miles of wire, and $1,000 of
fees. That as the defendants sr
} informed and believe, the pretended
, mileage is arrived at by adding to
gether the mileage of all the com
, plainant's lines the Western Uniol
! has ever bought, leased or built, 1
large portion of which has Ions
: ceased to exist, and another portion
consisting Of useless parallels, con
structed on purpose to be bought b.
T the complainant, which remain OF
? its hands as worthless. That three
Q fourths of it's eff ,es are Furnished d
Q operated and maintained by railroa
= companies, without expense to tn
3 complainant. That the defendan
j alleges upon information and bslie1
that the total land plant in actus
t operation, exclusive Of the cable IN
@ terests, which have been leased b
n the complainant, does rot excee
l. 100000 miles of poles and 400, ,OC
@ miles of wire.- That defendants ar
8 informed and believe that 80, 90
y miles Of poles and 10000 miles
n wire are more than sufficient to n
D. place it's said plant in operation
% That the total or cash value of It's 81
J. tire plant, including off oes. fixture
@ and other property, does not excee
n the sum of $40 0.OO0, 900. That asco
10 ding to the estimates of reliable e.
perts it could be replaced for tn
- sum. That subtracting from tn
s. sum the amount Of SIS .OOG, 600 o.
in standing bonds hereinbefore me
o. toned, there is left only the sum
~ S., 600, 600 of tangible and actual b
:, sis for the $97, $40 900 of stock
.. "That Notwithstanding the fact t
% various opposition companies viii
have existed from 1866 to the pre-
n ent time, have been absorbed by t
complainant, it has continued to
ceive enormous gross and net ear
~ ings, so that, although it increas
10 its capital from 81 ,OO0, 600 in 1880
&C $50, ,OOO, 900 in 1881, and from $Sl
"a 600 900 in 1881 to $97 $40 900 in Ii!
~ the profits of the business have
n abled it according to its statemen
he to pay six per cent on its fctitie
n. capital, and also to accumulate
or large surplus in addition to payi
~ its officers the most Hxtravagant s
par aries.
In support of the allegation OF
~. immense net profits accruing to s
NO company from its said business,
"a defendants submit the following
ing :.
Ter CONTINUED on 4th page.)