The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1904-03-05

the board OF Directors at a recent meet
ing decided to begin next September
might be continued and that by reason
Of the improved condition and the in
creased value OF the road of the defendant
corporation and its increased earning ca
pacity during the past year, many APP
plications have been made to the Governor
Tor lease of the property of said cor
peration, among which said application
was one which was made three days
preceding the institution of this suit by
V. f. McBee, the now temporary re-
ceiver appointed in this cause.
And further answering defendant says
tEat the appointment OF receiver for
SAID road, even it the private stockhold-
eTs demanded such appointment, which
ms denied, would not in any way tend
to improve the condition of said road
or increase the probability of its declaring
a dividend. but on the other hand, owing
to the difficulty of administering the af-
fairs OF railroad through the medium
Iol court and the expense attendant
upon receivership, the prospect of
declaring dividend upon the stock of
\ the corporation would be destroyed. and
the debt OF the corporation increased.
And further answering. this defendant
says that it a lease Of the road or said
defendant is desirable, the duly consti-
tuted authority to which such power
IS given by the charter and bylaws of
said corporation are much more compel
ent to make such lease upon advanta.
geous and satisfactory returns to the
corporation and to it's stockholders than
a receiver would be.
And further answering, defendant SAYS
that the question of determining whether
or not a lease of said road to any one
lis desirable, is placed by the charter
and bylaws of said corporation upon
who own it, that is to say, upon the
State OF North Carolina, which owns
twothlrds OF the stock, and upon the
private stockholders WHO own the other
third; and SO far as appears to this hon
oIable court, no other stakeholder se,1
aud except the complainant in this cause.
whose ownership of stock according TO
lay does not appear, is asking the in
4 tcrterence of this court in the legitimate
and orderly administration of the affairs
OF said corporation by the owners of its
stock.
10. That the allegations of paragraph
ten OF the bill OF complaint are not
) true. The property of the defendant cor
p6ration is not in deplorable condition,
ard none of the stockholders of said
company has endeavored to negotiate a
lease OF the same on the terms set out
IN said paragraph. And defendant AYERS
that 1t is not true that parsons desiring
to get possession of the property of said
corporation, recognizing tits desirability
on account of its greatly improved condi-
ton, have within the last few years made
several propositions to lease the prop
arty, and the defendant AYERS that ecah
I successive nrOnnSjtinn nf hoe
made upon better terms to the stock
; holders of said corporation. 1t is not
true as defendant further AYERS that
the floating debt of said defendant is
100000, but only about 100000
H. That as the defendant is informed
and believes it is untruv as alleged in
paragraph IL Of the bill OF complaint.
that as result of the endeavors of the
stockholders other than the State, sever.
al propositions OF lease have been formu-
lated and submitted to the Governor with
n the last two months by reliable par
ties who are willing to deposit with the
Treasurer OF the State solvent bonds in
sufficient amount to guarantee the faith
lul performance of the contract of the
lessee. 1t is true that several persons
are now willing and ANXIOUS 10 lease
the property, but it is untrue. as defend
ant is informed and believes, that they
desire to lease it upon terms most favor
able to the stockholders. 1t is true that
in December 1902 proposition was made
10 lease the road at a rental beginning
at about IL per cent and averaging
per cent for 30 years. 1t is true that
the proposition was made in September
1863 beginning with 2 per cent and avera-
ging about 3 per cent for so years It is
also true that an offer to iease was
madc some two weeks ago by V E.
McBee the person named as temporary
receiver beginning with 2K per cent ami
running up by graduated scale to
per cent and at the end of 90 years
Il per cent for the remainder OF 40 years
averaging through the term per cent
1t is true that said McBee upon the
suggestion of the Governor, that he would
not recommend a lease at these figures,
filed another bid which was withdrawn
while the Governor was considering it
on the 23rd day of February, 1904, the
day the bill OF complaint in this suit was
verified. 1t is true that on the 24th day
of February 1904 after the bill of com
pllint was filed III his case. eli offer to
lease was made by w. w Mills and
III. l.. Finlayson to lease the property
LOT the defendant for a term OF 90 years
at rental of per cent for the first
10 years, 4 per cent for the next 10.
II per cent for the next 10, and Z per
cent for the remaining Is years the
losses to pay the floating debt, the in
terest on the bonded indebtedness, etc.
1t is true that it was oetter offer
than any heretofore made as affiant is
informed and believes, and it is made by
the same interests that made the propo-
sition III September 1908. This PROPOSE
ton also includes the building OF 90
miles OF additional railroad in North
Carolina.
Il. That as the defendant is informed
and believes it is not true as alleged
in paragraph IL of the bill of complaint
that the stockholders other than the
State are almost unanimous in their de-
sire that some one of the propositions
should be accepted. Tho defendant is
informed and believes that so much of
/ paragraph u as alleges that in the month
of September 1903 a meeting OF the
81 cckhoidprS was dNlv calIfi fo,, he mn