The county record. [volume] (Kingstree, S.C.) 1885-1975, 1903-12-03
OFFER OF A BRIBE,
Sensational Testinonyia Famous Shil
Building Scandal
How ;s,ooo,ooo STOCK IS DIVIDED
Nixon Says He Afterward Recon-.
meuded Sheldon Plaa-Other Tes'
timony.

New York. Special.-Testineny OF
q sensational nature was introduced
at tho United States Shipbuli&ns
hearing which Sas resumed Tuesday.
During the course of his redirect e.
animation Of Lewis Nixon, president
OF the Shipbuildins Company, Mr..
Untermsyer, counsel for the complain
ants, brought out from Nixon tAs
statement that OF the 36,ooo.o0o I'd.
ditIonal stock issued when tho COM
pany wan re-organized to take Beth
chem Company, 100000 vent 10
Max Pam, Mr.. schwab's counsel. and
8, l,oOO, 900 each to Mr.. Nixon, Nj.
Dresser and the Trust Company Of ths
Republic, leaving 100000. the dis
position of which he did not konw. He
did not know whether Mr.. Schwab OBJ
tanned It. It was Also brought out that,
at the time the Sheldon reorganisa-
ton plan was under consideration,
Mr.. Schwab offered to purchase $780,
600 bonds, with the accompanying
bonus Of $4,000 shares common. spa
$4,000 shares preferred stock, Issued
TO Mr.. Nixon for $4,000, while the
market value was far less than his.
Mr.. Untermeyer making the direct
charge that this was in the nature OF
q bribe to induce Mr.. Nixon to agree
to the Sheldon plan Of Reorganization
instead Of the plan for an assessment
Of stock, which he had previously sd-
vocated
The offer was shown In two letters
OF Mr.. Schwab to Jos. H.. Hpadlsy,
dated May 2s, 1903, copies Of which
we're introduced in evidence. Mr.
Hoadiey, it was testified, had con-
Quoted the negotiations with Mr.
Schwab, when Mr.. Nixon was e..
deavoring to persuade Schwab to a.
cede to the assessment plan and had,
after the proposal, urged Nixon TO ae-
cede to the Sheldon plan. Nixon said
that at Hoadley's request he had done
so.
The iatters are as fellows:
provided the United States Ship
Building reorganization is perfected
hereby guarantee to take and pay f0
500 900 OF first mortgage bonds OF the
United States Ship-Building Company,
100000 shares Of preferred and IS,0oo
shares of common stock, for the sum OF
500, 900, plus interest on said bonds, on
or before December 1, 1908. Said bonds
and stocks to be deposited with
Messrs. Mcintyre & Marshall, "a Broad
way, New York, and to be exchanged
for securities Of the recognized
company, as designated by agreement
sued by the reorganization commit
zee.
(Signed) &C. N. sCHWAB."
providing the United States Ship
Building Company reorganization u
perfected, I hereby guarantee to pay
to your order $4,000, amount Of pay
ment which has been made to the Shell
don syndicate on subscription OF
500, 900 made by Lewis Nixon. / also
agree to have said subscription placed
TO my account and guarantee to have
q complete release issued By said
Nixon, by said Sheldon syndicate.
(Signed) &C. M. SCHWAB."
after the date of these letters did
or did not Mr.. Hoadley get you to ac-
ccpt this plan?" asked Mr.. Unter-
meyer.
"Mr. Nixon explained in answer that
Mr.. Hoadley advised him to consent to
the Sheldon reorganization because
Mr.. Schwab had refused to accept the
assessment plan and that he (N!Non)
had threreupon written letter recon-
mending the Sheldon plan.
"As to my deriving any profit from
the transaction, that is nonsense" said
Mr.. Nixon. "The transaction concern
ed others and I prefer that they should
tell it."
Mr.. Nixon testified to writing to Mr..
Schwab later and obtaining from him O
letter eonfirmatorv Of the PROPOSAL IN
the letter Of May 26 to Mr.. Hoadley.
Mr.. Schwab's letters stated that the
proposal was contingent upon the sue
cess Of the Sheldon reorganization
plan and Mr.. Nixon said that he then
let the matter drop.
Witness said, in reference to the
Sheldon plan, that he felt greatly ir-
ritated' because he thought the presi-
dent Of the ship yards company had
not been consulted, and reiterated his
statement at the previous hearing, that
his only knowledge Of the reorganiza-
tion plan had come from conversations
with Mr.. Pam.