New-York tribune., 1903-06-18

- C--s-,x- vas that of H. H Vreeland.
..-..,ae,+ of the latter company. Although the
1re-ropolitan has been paying per cent yearly
dividends on its stock. Nj Vreeland teSuhea
4ba. in the year 1901 there was deficit OF
so7 900 exclusive of interest the floating
oeh+ and allowance for the franchise tax ana
that the deficit for 1902 was about S215oo e%-
,l,,e;,.e Of about S900e 600 for interest on the
GEARING debt and for the franchise taxa total
- over rer cent on the company's capital
stock Other witnesses were Jacob H Schin. OF
kuhn Loeb & Co. and Isidor Wormser, tr. the
,laintif in the action.
BANKERS PROFIT s1.5oo,Oo0.
Mr.. schin. the first witness, said Kuhn. Loeb
& Co. received S1.5o0oo0 for underwriting the
Ir1erurban lease If Thomas F. Ryan who
testified that he took seven thousand shares in
the securities company. was of the syndicate
-bst underworld the S23. 100000. he shared In
this proht but witness did not think he was IN
the syndicate Similar questions about MessTs-
Whitney. Widener EIkins and the Morton trust
Company brought the reply that every member
of the underwriting syndicate profited in proper
zion IN the amount he subscribed. but that he
oxnuId not remember each members holdings
The Morton Trust Company. several Of whose
directors are directors otherwise interested IN
The Iuterurban road. Mr. Schin testified, in ad-
SOAiAAAAA~
sion. received 100000 for Legitimate banking
work as financial agent for the companies
DEFICITS IN 1901 AND 1902.
President vreeland of the Metropolitan and
1nterurban then resumed his testimony broken
off on Tuesday. his direct examination being IN
part follows:
o.-what was the result OF the operation nI of the
system in the year ending December s. lSME A
o a
Odd that deficit include the interest on tne
ODD it include any allowance for the Fran
oTse Vas the result of the operations of the
year ending December 81. 1902? A--Ihere was
o0That was exclusive Of the interest the debt
ane the franchise taxi At was: ,--,o,,-+ Of
that interest and tax? A.-Neariy Sseo0ce' accord
IF So oo 600 had been expended for electrify-
ing the horsecar lines how long would II take 10
would take from two to three years, and during
the time OF construction there would be an actua4
ot.TIfov long would it take to get profitable re
turn from that new construction? A.-Perhaps
o.Dcouid you have continued to pay per cent
earnings of the system? A.-Aot as matters 1hen
oCwhat pavments were made in 1902 to the Met
ropoltan company? A.-Payments made IN april
June. My 1ad beda2p o 3he @ per cent re-
funding bonds Of the Metropolitan company? A
They were delivered TO the lnterur6an 19 company
O-I5ad YOU interest in the syndicate Oe-
scribed by Mr.. SchifT? Al had not.
To the best of his knowledge. none of the
directors Of the Metropolitan had anything TO do
with either the Interurban underwriting syn
dicate or the Metropolitan Securities Company
under the text of the Third-ave- lease TO the
Hetropolitan Street Railway Company. The
stockholders were TO receive . per cent on the
capital stock until 1906 amounting in the gross
to Se000oo: until 1907. 6 per cent. amounting TO
S9e0oo0. and thereafter Z per cent. or $1,000
Oo0
EXPECTS 1903 ESTIMATES TO FAIL
Witness first heard from Mr.. Cravath of the
Interurban company in connection with the plan
10 lease the Metropolitan. His estimates of the
earnings Of the Metropolitan system were not
realized in 1901 or in 1902 and he did believe
from present indications that the estimates for
1903 would be realized. They had not been so
far.
Mr. Nreeland not feeling well, and after
recess was allowed to CO. when he had supple
1nented his testimony by a written statement
that the failure Of the estimates he submitted
to Mr. Schiff was due TO the ruling of the Court
Of Appeals In the franchise tax case. which in
creased the company's expenses $4,000 a year.
and the increased cost Of coal material and
labor
y. Clifford Moorehead auditor of the Interur-
ban company and formerly treasurer of the
Metropolitan system testified that the floating
debt of the Metropolitan Street Railway Com
Tany OF January 81. 1902, WAS S10.s92. III Is.
It was all Paid with funds provided by the IN
1erurban company.
PLANNED TO CONTROL ALL TRACTION.
Isidor Wormser jr. the plaintiff in telling Of
e talk with Mr.. Ryan, before the Metropolitan
circular issued to the stockholders in the
Morton Trust Company's office, related Mr.
Ryan's description to him of the lease plans
and the reasons for it. substantially as Mr.
Ryan himself explained them the witness
stand. including the assertion that the original
intention for the original syndicate TO keep
al the stock. and continued:
/ asked Nj Ryan the object Of the new corpora
ton He said that II was wei supplied with
money: that II was prepared TO finance the Metro
wealthy concern. He said the corporation was to
get al the earnings OF the Metropolitan system
position 10 acquire other lines in New York City
other corporations doing Electric iFtins 2ss and Hl9 II
necessary. TO acquire interests in the corporations
owning and operating the tunnels. That's what
! said saw no reason for the change; that the
was promising The METROPOLITAN company was
rngs spoke Of the vafe of fhe ThraTe Tft Or s
lease and offered TO raise SO 600 for the of
told him would charge nothing for my services
zanced the excess should be returned to the treas
ury OF the Metropolitan Street Railway Company.
I reminded Mr.. Ryan that the shareholders Of
the company had always been ready 10 raise any
money the company needed told him If the com
Jany would issue more stock ! would underWrfte
the entire myself at 155 that the corpora
sinn could realize all the funds IL needed to nav
of Indebtedness and make the projected improve
,nents. reminded Mr.. Ryan that the corporation
controlled what is practically monopoly OF the
surface railroads Of the city and that the past and
certain future growth of the city guaranteed in
creased earnings instead Of keeping them 10 per
cent OF the capital.
Cross-examined Mr.. WOrmser said he learned