Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1903-10-22
Don't have a fall
ing out with your
hair. Use Ayers
Hair Vigor. s s:s:'': s S.:

troduced the subject of purchase of
Bethlehem and then followed a general
conversation.
II was most anxious to purchase
Bethlehem and so told Schwab and
Dresser testified the witness. II
think it was the next day that we went
to Schwab's office. The conversation at
the Lawyers Club was very brief and
very general
when we met in the morning at
Schwab's Office. the next day, we plung-
ed at once into business. Schwab pro-
duced reports of earnings showing that
the bethlehem plant had earned 81, AGO.
Co.," said the witness.
Mr.. Untermyer wanted to know if
Schwab had represented that the
Bethlehem Co. had earned s1,4O0, 0GO
after paying the interest on underly-
ing mortgages. The question was OBJ
jected to by Attorney Guthrie. The
witness said he understood the sum to
be net earnings. Schwab told the wit
ness that he had paid $7,40O,0OO for the
plant. This sum with the earnings which
had not been taken from the business
amounted to 100000, the sum for
which Schwab said he would SELL Mr..
III CoSel SdIu SJ,UUU,pVU was d large sum
to raise at that time. The question of
securieties came up at later meeting.
The witness said he was quite sure
Schwab had asked $9,000,000 in cash for
the property at the first interview. Mr..
Dresser told Mr.. Schwab of the diff
culties of raising money and the ques-
ton Of securities came up. Mr.. SchWab
agreed to take $10,000,000 bonds at 80.
when we saw Schwab again. con-
tinued Mr.. Nixon, "he said We would
have to give him S10,000,000 of each
kind of stock besides the bonds.
Schwab said he had to give $500, 900
of each kind of stock to ]. P. Morgan
& Co.
Nothing was said as to why Mr.. Nor
gan & Co. were to receive the stock.
Mr.. Dresser said he was willing to pay
the price"
Mr.. Nixon could not remember where
he signed an agreement with j. P.
Morgan & Co. for the sale of the Beth
lehem Co. He had signed many papers
at Dressers office. The agreement had
never been explained to him and he
could not understand why he had been
made a party to it. The witness said
he had acted to the best interests Of
the Shipbuilding Co. and with no idea
of any gain for himself. He could not
explain why, after the agreement to
purchase Bethlehem from Mr.. Schwab
for $4,000, 900 in bonds, $10,0OO,000 in
preferred stock and $4,000, 600 common
had been made. an agreement was
made with Morgan e. Co. to put the
plant in for 81, 20O,OCO in cash and $4,000,
| COO in stock.
Mr.. Nixon told of the passing of the
| check for $7,200,000 at the office of
| Morgan & Co. Il did not have the check
1 long enough to see who signed it. said
Mr.. Nixon. Mr. Dresser asked per-
mission to put the check through his
Blank, but permission was refused. We
Ihad the check long enough to endorse
Fit and turn it over. do not even know
who received the check
| The original check was produced by
Mr.. Guthrie and after Identification by
counsel, was offered in evidence. The
check was for S7,191. 791.4S, and was
drawn in favor of ID. Leroy Dresser and
Lewis Nixon by c. NJ. Schwab by his
attorney. Oliver Wren.
The witness could not explain why,
| while the agreement called for $7,246,-
600 the check was for $7,191, 791.4S. Mr..
| Cntermeyer asked if there was any one
ut the meeting at the office of j. +.
| Morgan & Co. to protect the interests
of the Shipbuldng Co. and the witness
said he and Mr. Dresser were there rep
resenting the company. The witness
| said he had read the agreement and
seen the stock. He did not examine
| the stock and understood it was later
taken to one of the trust companies.
At the afternoon session Mr. Nixon
testified that Schwab had said he want
| ed some of the promotion profits, If
| there were any. in order that he might
give some of them to Gates of Harris,
Gates & Co. Schwab said that those
who had aided in the undertaking
should have some of the promotion
| profits. The witness said he talked the
matter over with Young, who said he
would arrange to give Schwab 100000
in bonds and either 100000 or 100000
in stock. This commitment must have
been in addition to the stock bonus
which Schwab received as an under
writer. The witness took SchWab a
paper on the subject. His recollection
was that Gates was to get $4,000 in
bonds from Schwab. The paper was a
memorandum signed by the witness.
Witness himself had nothing to do with
the promotion money. and Young later
gate him a letter relieving him from
liability on the memorandum which he
gave to Schwab.
The witness then related the circum-
stances under which he had first in
duced Schwab to become an under
writer.
There was a wrangle over the pro-
duction of the memorandum given by
Mr.. Nixon to Mr.. Schwab and Attorney
Guthrie said that it would not be pre-
scented until Mr.. Schwab took the stand.
Mr.. Nixon said that the arrangement
for the examination of the books of the
several subsidiary companies was made
by Mr.. Young, the promoter. The wit
ness said that he learned some time be-
fore the properties were taken over
that the options were being made in
his name. Except in one case it was
never explained to him why his name
Voc uSad Tho arra DgementS for the