The independent. [volume] (Elizabeth City, N.C.) 1908-1936, 1929-11-01

Members of the board of directors
of the hotel corporation are indors-
ers on a note for $l27,000, secured
by second mortgage on the hotel
property. The Metropolitan Lie
Insurance Co. holds a first mortgage
under bond issue of 100000. The
directors want to get off that note;
if they can dispose of second bond
issue they can relieve themselves
of the note. And if they form a
pool and buy in the bonds they Will
be sitting pretty i'll event of a re-
ceivership; for $325,000 they could
buy in a property costing $625,OOo
and with an investment OF only
1925, 900 the hotel could be made to
pay.
In event of rccclverShip every
Stockholder in the hotel would be
wiped out; there were more than 600
stockholders when the hotel was
organized; some of them have since
sacrificed their stockholdings for a
half or third of its par value, SELL
ing to members of the board OF
directors.
Who Would Buy II?
There are a few men oil that
board of directors who could buy the
hotel in; they are c. O., Robinson
j. w. Foreman, w. T. Love, Sr., J..
R. Foreman, Elisha CopperSmith and
w. j. Woodley. The other members
of the board need hardly be con-
sidered as prospective purchasers
of such an expensive property. 1t
is believed that C. O. Robinson ha
too much civic pride, is too Jeal
Gus of his good name to enter into
a deal to freeze out the stockholders.
and has too many irons III the fire
to wish to take on hotel owner
ship. No one suspects w. 7. Love,
Sr., or Elisha Coppersmith of want
ing hotel. But there are the Fore
man -Woodley interests to reckon
with; their civic pride has never ex-
celled their self interest to an ex-
tent that would provoke public ap-
plause. M. Foreman once served
his fellow citizens as chairman OF
the County Highway Commission
and built road around his farm
Mr.. Woodley served OH the same
commission and sold the count!
cement for its roads Mr.. Woodle,
as director of the hotel has seer
well TO it that his wholesale grocer,
got its Share of the hotels bU5ines!
The ForemanS and Mr.. Woodley fl
things up with God over on tn
corner of Road and Church SITS. o.!
Wednesday nights and Sundays anc
then look out for themselves.
This newspaper may be entirely
wrong in its suspicious, but its
suspicious are that the MeSSrS. Fore
man and Woodley would be the
principal owners OF the Virginia
Dare Hotel following receivership.
Directorial Malfcasance
But if those gentlemen cOntem-
plate any such move there is going
to be hell to pay in Elizabeth City,
for the directors of the hotel are re-
spcnsible for its capitalization.
They started out to build $780,
600 hotel. They had it all figured
out that a $350,000 hotel would pay.
They represented to the public that
they were going to build a hotel TO
cost not in excess of S350000; stock
was solicited on that representation.
They persuaded store clerks, widows,
farmers and men and women of
modest means to put their money
into hotel stock as an investment.
And then. instead of building a
S35O,O00 hotel, they plunged into an
extravagant building program that
cost ultimately S625, 1852. The
hotel alone cost $370,391 40. They
built an arcade costing S56,928.93.
they built a garage costing $l9,927.9l
They spent S65, 5,l42,ll for furniture
and fixtures. The site cost $85,
944.5O: the architects and promoter
got S27.6OO67 They built a beau
tiful hotel, thing to be proud 0.
/ but they did not give over muc.
. consideration to the welfare of tn
stockholders.
Only S349,O0O Of the stock wa
sold and some of that was neVe
paid for. TO finance their extla
vagance the directors jeopardize
the interest of every stockholder
putting a first mortgage bond iSsc
of 100000 on the property; later
second mortgage.
Paying interest on the bonded an
mortgaged indebtedness Of the hoUe
and paying taxes on twice as mucl
Capitalization as the stockholoers
originally bargained for are reasons
for the fact that the Virginia Dare
Hotel has been money losing ven-
ture from its opening on Nov. II,
1927.
II is hard on the directors in these