Evening journal., 1903-06-23
.SHIPYARD ASSETS
IN TRUSTS HANDS
1t Was Testified That the
Firm Now Owns the Old
Debts
HEARING WILL LAST ANOTHER DAY

New York. June 2a.-so earnest and vol
luminous were the pleas for and against
the appointment OF a receiver for the
United states shlpbundlng Company made
by eminent lawyers In the United States
Circuit Court at Trenton. N. J., yester-
day that when the hour for adjournment
arrived Judge kirkpatrick said another
day would have to be devoted to the hear
ing and summoned the liugants to as
semble again today in his court room at
Newark.
Counsel for the shipbulding Company
protested again and again against the
idea of tying up its assets and placing the
scattered plants IN the hands OF reoeiv-
err, and read afndavits from THE heads OF
the Bath. San Francisco, Ellabethport and
other constituent concerns TO the effect
that the credit OF their establishments had
been seriously upset by the very publlca-
ton of the complaint of the first mortgage
boniholders. and asseveratod their belief
that IL the Sheldon Reorganization Com
mittoc's plan for rehabntating tho Ship
building Company were put into effect it
would enable them TO continue as going
concerns.
Mr.. schwab Well Secured.
but at the same time they made admis-
sions that led the Judge to observe that It
seemed as n the parent company had all
the assets and the subsidiary concerns
owed all the debts. and that by the terms
of the transfers made when Mr.. schwab
threw his Bethlehem plant into the merger
he obtained very ample security. The ann
OF the Reorganization Committee to fur
lther 'ntrcnch Mr.. schwab was Indicated in
the proposed name OF the puggested re-
habnitated combination, which was 'ths
Bethlehem steel and shlpbuildng Com
pany."
Surprise was indicated, not only by thc
lawyers for the first mortgage hondhold-
ers. whose priority OF Hens II is proposed
to upset under the reorganization plan.
but by the judge, when 81 was shown In
several of the afndavits that the su'
sidlary companies held leases from the
parent company which the United States
shipbuildlng Company could terminate at
i've days rotice.
1t was when this fact was stated, co.
gether with the allegation that the parent
concern WuN MNl NlnNNtHAf inuuMn INC
subsidiary plants might have many bins
due. that Judge Kirkpatrick observed that
the parent concern seemed TO hold all tho
assets and tho constitaant companies owed
an the debts.
The name OF d. Leroy Dresser. whose
efforts to float the United States ship
building Company precipitated the difficult
ties OF the Trust Company OF the Republic.
a.
tus issued by tho Trust Company OF tho
Republic touching these shipbullding COM
pany's securities was alluded TO. one OF
the lawyers for the shipbullding company
objected. saying the shipbmldine company
had nothing to do with the troubles Of tho
trust company but counsel for the COM
plainants intericcted the remark that this
prospectus was signed by James Duane
Livingston, who was one OF the directors
OF the shipbuilding company as we'll as
vice-presldent of the trust company.
Mr.. Youns's Plan.
Just how the plan OF John w. Young to
effect the shipyard combination was pre-
sented TO the directors Of the United States
shipbundins Company and ratified by
them was made plain for the first time.
Mr.. Young offered to convey to the
United States shipbmidlng Company the
stock and properties Of the Union Iron
Works. of San Francisco; the Bath. Me-.
shipyard Company. the S. J.. Moore ard
Sons Company and the Elizabethport
plant the Harlan and IIollingsworth prop
critics at wilmington, the Eastern Ship
+ building Company Of New London, certain
: properties of the Canada Manufacturing
Company. and the entire capital stock Of
the Bethlehem steel Company (Mr. Sch
wab's property. consisting OF three hun-
b dred thousand shares, and further to pro-
vide the United States shlpbuilding Com
pany with $i500.0O0 an cash as working
capital and to deliver to the treasurer Of
the United States shipbunding Company
for the purpose OF working capital for it
Sl.50O.0o0 in par value Of a certified issue
! OF Eve per cent. gold bonds Of the COM
I pany.
The consideration requested by Mr..
{, Young was SO 500 in ful paid preferred
stock Of the United States shipbulding
> Company; s2f9ss 500 in full paid common
! stock; SIG 100000 of first mortgage five per
2 cent sinking fund thirty year gold bonds.
a to be secured by mortgage which would
!. be a first iien upon an the property and
plants of the above named concerns. which
were to be conveyed to the United States
T Shipbuiiding Company, and also Sl0,oo0,oo0
1 par value of the five per cent. twenty year
gold bonds of the United States shipbuild-
ing Company, to be secured by a mortgage
on the shares Of the stock of the Bethle-
hem Steel Company, proposed to be as
signed and delivered to the combination.
/ This proposition the directors and the
! bondholders of the then outstanding capt.
tai stock ratified.
4 Then meeting was held to increase the
(, capital stock to $l5ooo,ooo and TO amend
the charter to admit Of Mr.. Young's PROP
osition.