The Washington herald., 1913-01-10

tiers or documents between himself and
any of the directors or officers of the
First National or Commercial Fire In
surance Companies or other parties
named in the resolution which authorized
the investigation.
Mr.. Davis introduced letter to
Charles +. Carusi. general counsel for
the two companies. in which he mad
offered his stock bearing a face value
of $500 for Sl625. Carusi replied that
he was not In the market TO purchase
any more stock
letter from Mr.. Davis to Charles A.
Douglas, seeking information, was read
into the record. Mr.. Davis was par
ucularly interested in the connection De-
tween the Southern Building Corporation
and the Richmond Realty Company and
the extent to which the drectorates OF
these tvo companies interlocked.
Under the head statements OF facts.
DR.. Davis, wrote "the directors and
stockholders (Southern Building Cor
porationD. who voted to sell the second
and third mortgage bonds at $50 per
bond, are identical with the stockholders
composing the Richmond Realty Com
pany, to which the bonds were sold,
and the perfeTred stock given as bonus
Certain praties. who have recently sold
their stOckholdings in the Southern Build
ing Corporation, at . cents on the dollar.
owned a large portion of the Richmond
Realty COmpany's stock, and have par
ticipated in the enormous dividend de-
clared on that stock
Reads Another Letter.
In connection with this statement Of
fact he asked. lis this a correct state
ment? Particularly 1 would like 10 know
whether you. Mr.. James H. Baker. Mr..
r. H MCNEIL. Mr.. Samuel W. Meek. Mr..
4. +. L. Leckie, Mr.. J. l.. Baker, Mr..
james L. Karrick, or any of the other
parties. who originally went into this
deal. were interested in both of the COM
panies at the time this transaction was
made"
To this question Mr.. Douglas in letter
to Mr. Davis replied as follows:
so far as l know or remember al OF
the active participants in the organiza-
ton and promotion of the Southern
Building Corporation agreed to and in
dorsed the plans as above set forth.
Those of Us who held what was des-
ignated as promotion stock tried our ut
most to devise better and more salts
factory arrangements for the financing
of the Southern Building Corporation
but we simply could not. and when the
plan was put through as many Of us
as could subscribed and paid for in
money and at par for such Of the stock
of the Richmond Realty Corporation as
we were enabled TO purchase. Karrick,
Baker. Mcneil. and I. in varying
subscribed to the stock Of the
Richmond Realty Corporation. Meek and
LeCkle did not. You are in error in
the statement that the directors and
who voted to sell the sec
ond and third mortgage bonds at $50 per
bAnA iiaDti,al u-itb ha GfnTkhOIdarS
the Richmond Realty Com
pany.' I would say. in further answer
to this. that, perhaps. 90 per cent of the
to the stock OF the Richmond
Realty had no interest whatsoever in
the Southern Building Corporation"
Light on Directorntes.
AS throwing light on the question of
directorates, Mr.. Davis read
l statement showing that Edgar G.
iunn and Warner Moore were officers
n both corporations, and that Gum and
Moore. together with r. II. McNeill,
]. NJ. Baker. Charles A Douglas. oliver
J. Sands, a. L. Hawse, and s. W. Meek
we're directors in both companies, show
ng that seven out of nine directors of
he two com oanies we're Identical.
On cross-examination. Davis told
Douglas that the questions were an
wered by Douglas fully and frankly"
md accurately, as far as he knew.
Mr.. Davis was asked II he had ques-
ioned John J. Story, jr., as to the lat
eFs idea OF the value OF the Southern
Building and property.
Mr.. Davis said: It asked him the ques-
lon. He said he thought the property |
as worth s1.5J0.0o0. He repeated that !
tatement and on that information |
Cted.''
On Cross-examination Mr.. Carusi ask |
d him If his recollection was clear on |
his point. Mr.. Davis replied: ''Recol- |
action about that. That was the point |
We particularly emphasized. That was |
he main issue we wanted to find out" |
James Mann. an attorney of Norfolk, |
7as interrogated briefly. but the testi-
nony he was expected to give was ruled |
IT as Incompetent by the committee.