Arizona republican., 1899-10-25
Its Affairs Explained by Presi-
dent and Counsel.
HOSPITABLE new JERSEY
why That Stale Has Been Selected
by FianY Big Corporations as
Their Home-A Smaller Tax and
Absence of the Double Liability
Feature of o her Corporation
Laws.

Washington, Oct. 24-Mr. Francis
Lynde Stetson. who was one of the
prominent organizers of the Federal
Steel company. in the. capacity of
counsel, and President E. H. Gary.
was today before the Industrial COM
mission meeting. The Federal Steel
company was organized in September.
1898. Mr. Stetson was asked to ex-
plain the organization and charter of
the company. and replied that he
thought the charter was self-explana-
tory, and didn't know how to begin an
explanation of it.
'Is there nothing unusual about the
amount of stock of this company is
sued?" asked Mr.. c. j. Harris
1T probably bears as close relation
to its value as any other company's
stock" replied the witness.
He said the capital stock of the Fed
eral Steel company was $1OO. .OOO. 600
preferred and $780, coo common, the
amount issued originally, he thought.
being inside of ssS, 900, COO He had had
he acted as counsel in it's organization
and could give no information since
that time. The Federal Steel company
was composed of three steel companies.
the stock of which had been bought
and he thought practically all the
stock of these companies had been Sc
cured.
Trnf e7l IN no
ton. wanted to know why the Federal
Steel company went to New Jersey
for it's charter, and inquired particu-
larly as to the advantages the com
pany got there that it could not get
elsewhere.
1.-The laws of Pennsylvania" said
Mr.. Stetson, ''do not permit the owner
ship of real property by foreign cor
poration, and the rate of taxation up
on domestic corporations is very high
The laws of Ohio, under the constitu-
ton of the state. impose a double LA
bility on all stockholders, whatever the
conditions may be. The laws Of Illi-
nois, as they have been administered
and interpreted there, and the same
applies to Ohio are exceedingly in
hospitable for the development of in
dustrial enterprises. The laws of Min
nesota also impose a double liability
on stockholders. The attention of the
incorporators was directed to West
Virginia and New Jersey. West Vir-
ginia places a limit on the capital
which a company may have, and until
this year Pennsylvania did the same
thing. There was no reason why We
should not go to New Jersey as well
as to New York. as neither of those
states was the home of the corpora
ton
Speaking again of the advantages OF
an Incorporation in New Jersey. Mr.
Stetson said:
Taxation of an Incorporated COM
pany in New Jersey is lower. than in
New York. but there are other rea-
sons perhaps more important that
have caused these companies to go to
the former state These other reasons
concern the liabilities and immunities
of stockholders and directors in New
Jersey.
I'm New Jersey there is no personal
liability for stockholders, and the
amount to be paid in for capital stock
must be paid in There is a mistaken
idea that laws of New Jersey allow
stock to be issued as fully paid when
It is not fully paid.
Then, too, there is no limitation in
he New Jersey law of the amount of
Indebtedness company may incur,
While in some other states corpora
ion cannot incur Indebtedness in ex-
,ess of a certain per cent OF its CAPT
al stock"
He said the railroads of this country
re today officered by the best busi-
less managers that can be found in
ny business. whether private or gov
He thought this country
hould be proud of the class % men
ngaged in the management of its
ailroads.
The roads that have become bank
upt in this country have been forced
nto that condition because of low
ates that had been brought about by
egislation in some cases and by sense
.ss competition among the railroads
themselves He favored publicity in
ne affairs of railroads, and such cor
orations as insurance companies that
re public affairs, but not in the case
corporations engaged in industries.
the latter case it would result in