Evening journal., 1903-10-23
SCHWAB BLOCKED
PLAN SAYS NIXON
Latter Wanted Stock AS
sessed to Save the Cor
poration
(HIS OPPOSED BY IRON Man
Nixon swore sehwab Would Not As-
sist Unless His Bethlehem Bonds
Were Given Preferenee--A Myster-
ious Check.

elet Onleso tbs DSe'"o"o" S~"~~
Were Given Preferenee-A Myster-
ious Check.
New York, Oct. 2s-Lewis Nixon
occupied the witness chair again at
the hearing before an examiner of the
United States Shipbuilding case, and
gave much valuable testimony cover
Ing the finances and general affairs
Of the corporation. He testified that
he had opposed the Sheldon reorgani-
zation plan. and had as a counter prop
osition urged that the stock be as
sessed in order 70 raise the amount
necessary 10 save the combination
from default and bankruptcy. Ills
plan of assessment was opposed by
Charles NJ. Schwab, holder at that
time of $40. 100000 OF the stock. who.
according TO Mr.. Nixon. declared that
the stockholders would not pay the
assessment
Mr. schwab. so Mr.. Nixon swore.
declined to put up any more unless
the Bethlehem bonds were given pref
erence as a lien upon the shipbuilding
plants to the first mortgage bonds.
To Mr Untermyer's question If he
aid not know that the plan meant the
wiping ont OF the flrst mortgage bonds.
the Witness replied that in the end he
had regarded it as the only recourse.
He did not appeal TO Mr Schwab for
money, because Mr.. Schwab had plain
ly stated what he would do. but tried
to get money from at least one of the
companies.
Mr.. Nixon said that he was angry
70 fad letter. coming from Mr.. Gary.
treasurer OF the shipbuilding combine,
and sent TO the reorganization COM
mittee, there was statement that the
contracts on hand and those about to
4 he made would earN s1.1ooo0o. Wit
e ness said this letter was prepared
p without his knowledge.
y Mr. Nixon said that Mr. Gary had
e previously shown him letter he haf
s. prepared to sent TO the reorganization
committee. which gave the probabl
NJ earnings as $4,000 Witpess said h
~ saw no reas55s % ike sTc.....s.. &.
p these figures.
OF Were the figures Of the earnings
ie OF the first quarter as submitted 70 the
II Stock Exchange true or false?"
THAT is a matter of bookkeeping,
think the figures erroneous, but not
necessarily false"
Samuel Untermyer, counsel for the
bondholders. asked II It did not show
, that there had been an attempt to min
\ imize the value of the ship yards and
i ]
plant, but the witness would not
=. say so.
5 Much time was taken up with an un-
successful effort TO get at the history
Of a mysterious check for s250,000
found at the Trust Company OF the
Republic II was drawn to Lewis
Nixon and ourselves" on tho same day
I the checks were made out for the pay
ment Of the cash given to the vendors
for their plants and property Mr..
{ Nixon swore that he had never seen
= the check before and that he knew
{ nothing of its history Both sides dis
X claimed knowledge Of its history and
9 the destination Of the amount of money
Il for which Il was drawn and the only
. explanation offered from any source
n was that it had been made out by mis-
J take and had simply been put through
the banks by the Trust Company OF
!, the Republic. The effort to getfHt the
Il history of the check will be renewed
y later in the hearing.
i Mr. Nixon testified that he knew as
! early as last April that unless tho
n company could get some money from
the Bethlehem property or elsewhere
II must fail. and warned his associates
= Of the directorate that they must hus-
4 band resources. 1t was brought ont
e on cross-examination that the share OF
promotion profits set aside for Mr..
q Schwab had never been paid None
! Of the commitments on account Of pro-
motion were paid, so Mr.. Nixon tes.
tilted.