The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1902-07-16
In Answer TO Suit SchWab
DisCI0sGs The Assets
EARNS $14O,OOO,OOO A YEAR
These Statements as to Values and
Earnings Were Presented to Dis
prove Charge That schwab
Made Fake Certificates.

4seWarki N. J., July 15.-The answer OF
the United States Steel Corporation to the
suit brought by J. Aspinwall Hodge. Jr..
William Curtis and Bernard smith, who
asked for an injunction TO prevent the
company from carrying out its bond-con-
version plan, was filed today before Vice.
Chancellor Emory. Wien the case came
up before the vice ehancenor It was put
over until July %. The answer is sworn
to by Charles NJ schwab as president.
For the first time since the organization
of the steel corporation. a detailed state
ment of the assets of the properties OF
the subsidiary companies is furnished.
The assets, 1t is stated, include four
hundred producing mills of the value OF
$500, 100000; seventy-five blast furnaces OF
the value of s4s,eO0.000: iron and bessemer
ore properties of the value or 500, 600 COO:
coal and coke properties of the value of
sl0o,000,o00, natural gas fields of the value
of $2o,ooo,o6o; cash in hend to the amount
of $4,000 600, and over SsO.00O,0O0 of ma
terial In process of manufacture. The
total value of the company's property, in
Guiding Gosh and cash assets, is placed
at $1,40O, 100000 by Mr.. Schwab in an af-
ndavit which is part OF the corporations
reply. The company's earnings are stated
to be at the rate OF more than $1,000 900
a year.
Saving of $4,000, 900.
A saving of s40,O0O,o00 year is credited
to the ore properties and 1t is estimated
that the ownership of the transportation
facilities saves the company $l0,000,000 an
nually. The earnings of the coal and
coke properties are stated to be more
than Sl,000,000 a month. These statements
as TO the values and earnings were pre-
sented to disprove a charge by the plain-
tiffs that Mr.. Schwah. the president, and
Mr. TrimDle, the secretary, made a false
certificate when they certified that in
their Judgment the properties were worth
at least the par value of the preferred
stock after deducting all Indebtedness.
The corporation declares that ii has had
no knowledge that Mr. Hodge is the
owner OF hundred shares of its pre-
ferred stock, but admits that In August
1901, one hundred shares of preferred
stock were transferred to his name on
the company's books. 1t is denied that
William H. Curtis Is the owner of the
companys Stock and 1t is declared that
Bernard Smith is the holder OF 200 shares
of preferred stock which was trans
ferred to him on June 26, 1902. The con-
version plan was agreed upon at a stock
HieellilB On May ~.
includes $1o,ooo,ooo Payment.
The answer admits that the conversion
plan includes payment of s10.O00000 to
j. P. Morgan & Co. II denies that any
of the acts contemplated will work fraud
or injury to the complainanss, but says
that on the contrary such acts when con-
summated will be greatly to the benefit OF
the corporation and of every stockholder.
The answer says that some of the direc-
tors are members of the syndicate formed
by ]. =. Morgan & Co. to float bonds, and
that that fact was communicated to
stockholders in a circular dated April IL,
1902. 1t is further declared that the direc-
tors interested constitute a minority
of the board of directors that they were
individually at the time of the forma-
ton of such syndicate, and now are own
ers and holders of large amounts of tho
stock of the defendant corporation, and
that they became parties to the syndi-
cate and assumed their proportion of the
liability thereof In order ro assure the
success of the plan Of purchasing and re-
firing the preferred Stock as they be-
lieved such plan to be OF great value To
the defendant corporation and its stocka
holders