The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1900-03-09
SEAB0ARD MAKES ANSWER
TO RYAN'S LATEST SUIT
Says Certain Allegations Made by Ryan Are
False and That Ryan Knew It,
FIVE SEPARATE ANSWERS ARE FILED

that the agreement was made with Ryan by
these gentlemen, "acting not directors of the
road or in their right as large stockholders,
but acting committee appointed in and by
a prior agreement dated October 2 1896 between
the holders of the stock of the road By the
express terms of this agreement mot only
no power authority conferred on the com
mittee TO sell the stock of the persons pooling
the same Hereunder, but each stakeholder party
thereto bound himself not to sell otherwise
dispose of his holding, or any part thereof with
out the written consent of the holders of three
fUurths of the aggregate amount of shares held
by the parties to the agreement When the
complainant Ryan entered into the agreement
of Oct. 6, 1856, he had full knowledge OF the
said agreement of October 9. 1895, and the terms
thereof and that the same was then circulat-
ing among the stockholders for their sigma
lures. Subsequently the owners of the stock
Ryan offered to buy under the agreement declin-
ed to sell-less than one-half giving their VIII
ten consent. The plaintiff was duly notified OF
this and the $1,000 deposited by him under the
agreement guarantee was returned to him
Thereafter the said Ryan slept upon his rights
to redress, il any he had, until after the sale
of the stock to William, Middendor and other
holders and Ryan did not assert his rights by
action at law nor by suit In equity until Jan
;, 1899, latter he had learned Of such sale
said agreement of October 6, 1896"
Following this is review of the various suits
instituted and lost in this case by Ryan.
tors was elected for the Seaboard and Roam
oke Railroad Feb. 8, 1899, but 1t is ac-
knowledged that on Feb 6. 1899, at regularly
called meeting of the board of directors, Jonn 1
SHELTON Williams WAS elected director to fill
a vacancy in the board, and was also elected
president.
THE SALE OF TREASURY STOCK.
V. Ryan's allegation in reference to the sale
by the Raleigh and CASTOR Railroad Company
of the Isis shares OF the capital stock OF that
company formerly held in its treasury, Is de-
MED The sale of said treasury stock was au-
thorized by the stockholders of the Raleigh and
Castor Railroad Company at their meeting dulF
called and held at Raleigh, y. c., on September
6, 1855, by the unanimous vote OF all the STOCK
represented at said meeting, being a large ma
iority of the stock of the said company: Al
that meeting this defendants (Seaboard ana
Roanoke) holding of stock in the Raleigh ana
Castor Railroad Company was voted IN FAVOR
of such sale by the committee chosen ana APP
pointed by the stockholders OF this defendant
at their annual meeting held October /, 1898
The object OF this sale OF treasury stock was
''to obtain money needed by said Raleigh ana
CASTOR Railroad Company for its corporate pur-
poses and which that company must obtain eth
by sale of such stock or by borrowing Inc
minimum price fixed for the treasury stock by
made at 500 per share in casl-a higher
price than had been Paid for any Raielgh ana
Castor stock Tor many years previous, for the
stock being freely offered on the market
by private holders for S45 share without takers.
VI All Of Ryan's allegations in reference TO
the sales by the Seaboard and Roanoke Railroad
OF its stock holdings IN the Oafolllla tentTdl IHt
Georgia Carolina and Northern, the Raleigh and
CASTOR Railroad Company and the Seaboard AR
Line Belt Railroad Company and its holdings
of bonds in the last named company.
= J Here follows statement OF the matters men
toned in Ryan's allegations including the con-
soidation resolution adopted at the Raleigh and
CASTOR stockholders meeting in Raleigh on Dec.
9, 1Sc3
1T is not true that the shares Of stock of any
OF said issues or the said bonds have any peculiar
value 10 this defendant. either by reason OF the
voice which the ownership of such stock might
give this defendant in the corporate manage
ment affairs of any company issuing such
stock. for any other reason. 1t is true on
the other hand. that if, as stated in the bill of
complaint herein. the sale of said stocks by this
defendant will in any way facilitate the making
of direct rail connection and close alliance
union-the closer the betterbetween the Raleigh
and Castor Railroad Companys lines and the
lines of the Florida Central and Peninsular Rail
road Company and the Georgia and Alabama
Railroad, then il is greatly to the interest of
this defendant and each and all of its stock
holders, that such sale of stock be made
VALUE OF THE SEABOARD ROAD.
VII. Further answering, this defendant saws
that the line of railroad and property of this de-
PENDANT connecting with the Raleigh and CASTOR
Railroad at Weldon, including the terminals ON
tide-water at Portsmouth. constitute the natural
and necessary outlet to tidewater for all traffic
coming from and going to the Raleigh and Gas
ton Railroad and its southern connections The
passage of this traffic over this defendants line
and terminals is in degree dependent on the
ownership by this defendant of a controlling in
tercst or any interest in the stock of the Raj
eigh and CASTOR Railroad Company of any
other company. The traffic cannot be diverted
from the terminal at Portsmouth; no existing line
other than this defendants can be used; and
the enormous cost of a new line and terminals
is prohbitory of such an undertaking, even if the
physical situation would permit it. Even the
Southern Railway Company. with its great sys-
TEN and large resources, and with existing
tidcwater terminus at West Point on the York
river, was compelled by the exigencies of its
business to accommodate the natural flow of
traffic to the harbor of Norfolk and Portsmouth,
and for that purpose to existing line and
acquire terminals that harbor. The lines of
railroad of the Florida Central and Peninsular
Railroad Company extend from Camden. s. G.,
through Columbia, S. c., Savannah Ca. Fer
nandina and Jacksonville, Fla, with branches
to important points in fial1da' and comprise
g7s.7s. miles OF railr9ad The lines of the
vannah, Ga. to Montgomery, Ala, with
branches to important point; in Georgia, and
comprise 50 miles of railroad. Neither of
these systems of railroad has at present an all
rail connection to the North.
This defendant is informed and believes and 50
states that all the allegations and statements in
tho value, earning power and physical condition
of the systems of railroads OF the said Florida
Central and Pcninsuar Railroad Company and
the said Georgia and Alabama Railway respec-
lively are grossly prejudical, false and untrue
Certain it is, and the complainant herein does
not venture to assert the contrary, that con-
nection of lines and union of interests between
the said companies and the Raleigh and CASTOR
Railroad Company will give to this defendant Il
large and lucrative traffic in addition to what
it has ever had in the past or now has This
increase of traffic for its efficient and economical
carriage and handling, will require of this de-
PENDANT improvements in road and structures and
additions to facilities and equipment already
Inadequate to meet all the needs of its present
traffic. This increase of traffic will at the same
time increase greatly the intrinsic value of this
defendants stock especially If the money needed
4 hs, ola n,,1rI