The semi-weekly messenger. [volume] (Wilmington, N.C.) 1897-1908, 1903-11-27

| New York November 24.-Testimony
| OF a sensational nature was introduced
| at the United States Shipbuilding
hearing which was resumed here to-
! day During the course of his re-di-
| rect examination of Lewis Nixon, pres
| ident of the shlpbuilding company,
| Mr.. Undermeyer. counsel for the COM
| plaintants. brought out from Nixon
| the statement that of the S5,000,000 ad-
| ditional stock issued when the COM
| pany was reorganized to take In tEe
| Bethlehem company, s1000,O00 went to
Max Pam. Mr.. Schwabs counsel anG
| 100000 each to Mr.. Nixon. Mr.. Dres-
| ser and the Trust Company of the Re-
| public, leaving $1.00O,O00. the disposi-
| ton of which he did not know. He
| did not know whether Mr. Schwab Ok
| tained it,
1t was also brought out that at the
| time the Sheldon reorganization pia!.
| was under consideration. Mr. Schwab
offered to purchase 100000 bonds, with
the accompanying bonus of $4,000
sha.'es common and $4,000 shares pre-
ferred stock issued to Mr.. Nixon for
$4,000 while the market value vas
far less than this. MI. Untermeyer
making the direct charge that this
was in the nature of a bribe tC induce
Mr.. Nixon to agree to the Sheldon plan
of reol ganiZat ton instead of the plan
for an assessment Of stock. which lie
had previously advocated. The offer
was shown IN two letters of Mr.
Schwab to Joseph H. Hoadley, dated
May 26th. 1903, copies of which Were
intro duced in evidence. Mr.. Hoadley,
it was testified had conducted the ne
gotiations with Mr.. Schwab, when Mir.
Nixon was endeavoring to persuade
Schwab to accede to the assessment
Plan and had. after the proposal urged
Nixon tC accede to the Sheldon plan
/ Nixon said that at HC9dley's request
| he had done So
The letters are as follows:
''Providing the United States Ship
building reorgan zation is perfected,
hereby guarantee to take and pay for
| 100000 of first mortgage bonds of toe
United States Shipkullding Company
| 25,C00 shares CT preferred and 25,0OD
| shares of common stock for the sum
| of $9O,OO plus interest on said bonds,
| on or before December 1, 1903 Said
| bonds and stocks to be deposited with
| Messrs. Mcintyre and Marshall. a
| Broadway, New York, and to be ex-
| changed for securities of the reorgar,-
| lied company, as designateI by agrea
ment issued by the reorganization com
/ plittee.
| (Signed) &C. NJ. SCHWAB."
providing the United States Sh =
| building Company reorganization is
| perfected. | hereby guarantee to pay to
YOUR order $4,000 amount of payment
which has been made to the Sheldon
| syndicate on a subscription of 100000
| made by Louis Nixon. | also agree to
| Nla +n ny
| account. and guarantee to have a colu-
| Ulete release issued to said Nixon. by
| SAID Sheldon syndicate.
| (Signed.)
"CHARLES VI. SCHWAB."
After the date of these letters j
or did not Mr.. Hoadley get you to az
| cert this plan?" asked Mr. Unter
| MEYER
Nr. Nixon explained. in answer that
MIR. Hoadlcy advised hlm to consent
TO the Sheldon reorganization because
| Mr.. Schwab had refused to accept t..e
assessment plan and that he (M".
Nixon had thereuron written a letter
| recommending the Sheldon plan. a
10 my deriving any profit from the
transaction that Is nonsense" said Mr..
| Nixon. The transaction concerned
| other and l prefer that they shou' 1
tell it,
Mr.. Nixon then testified to writin-
| TO Mr.. Schwab later and ObtainInc
from him a letter confirmatory OF The
| proposal in the letter Of May 20 to Mr
| Hoadley. Mr. Schwab's letter state
that the proposal was contingent upon
the success Of the Sheldon reorganiza-
| ton plan and Mr.. Nixon said that -
then let the matter drop.
| Witness said. in reference to th'
| Sheldon plan. that he felt greatly fr-
| ritated," because he. though president
OF the shipyard company. had not bee-
| consulted. and reiterated his statenen;
| at the previous hearing. that his nnlE
| knowledge OF the reorganization piar
| came from conversations with :Is
| Pam.
The agreement Of July 2.1903. 3A-
| tween Nixon Dresser and Schwl-
| providing that Schwab should loan Il
Dresser s7,246.S11. to purchase the
Bethlehem stock from J. P. Morgan
and Company. as syndicate managers
in return for which Schwab was to -
| ceive $4,000 IN stock and 10000. 900 iT
bonds. was introduced in evidence
Mr.. Nixon testifying that he had al
ways understood that Schwah and nc
!. Morgan and Company. owned tn,
!. Bethlehem stock