A GUSTY MEETING.

Dominion, Volume 5, Issue 1412, 12 April 1912, Page 2

A GUSTY MEETING.

OPERA HOUSE CO

SOME SHARP PASSAGLS

The annual meeting of the Wellington Opera House Company, Ltd., held yesterday afternoon, wns a rath or animated one. .Some of the shareholders freely voiced contrary opinions to certain new propyls put forward by Hie directors.

Mr. W. If. P. Barber (chairman) presided, and there were present: .Messrs. \V. Freeman, .1. Dudgeon, W. C. t.ias> quoinc, T. (.1. Macartliv, — Laurie, Jos. -M'l.ellan, T. (',. Osborne, \Y. Osborne, J. Floeklon, E. \V. Jiiint, and \V. (.'. Cliallield.

The report and balance-sheet (already published) were taken a- read. Speaking to the udoptka of the report, the chairman remarked that certain improvement* to the Opera House bad been carried out during the year, and the building was now in a lair Mate of repair. Improvements had also beevi carried out in connection with appliances, etc. With regard to the property ill Cuba Street it was a matter for con-

gratulation that the whole of the purchase money had been paid oil', and the properly' was now debt free. It had been decided to go forward with the erection of a. new theatre. The company had purchased a suitable block of land in a convenient plnce for an up-to-date theatre, and the Hon. W. Pitt, of -Melbourne, had been entrusted with the preparation of the plans. These would be exhibited to shareholders before tenders were called. With regard to the balance-sheet, he wished to read a letter to tihe shareholders from Mr. W. C Stephens, the company's auditor. That nflicinl had called attention to tho fact that there was no register for the transfer of shares, and that no fees had been paid on transfers. No vouchers for dividends had been produced, and the secretary did not keep a petty cash book. Tho chairman explained that dividends were paid by warrants on the Hank of New Zealand, and that neither in this nor in any other company which he (Mr. Barber) was connected with was it necessary to produce vouchers for dividends. The bank had been written to, but, owjng to tho warrants having been presented at ! different times (the work entailed was too great to attempt at such a busy lime), the Bank declined to produce them. As to the petty cash, Mr. M.'Lenn wns allowed .1:1 per month, or .El- a year for potty expenses, and he did not think it necessary to keep n book to record what ho did' with the money. The amount covered the costs of stamps, telegrams, etc. It was decided, on the motion of the chairman, seconded by Mr. Laurie, (hat the number of directors be increased from four to live. Information Wanted. As tho chairman was about to put the motion adopting the report nnd balancesheet, Mr. .lames M'l.ellan asked if the chairman was going to say anything about the new proposal. .Mr. Barber: "That matter is not open for discussion. Jt belongs to another mooting—the meeting to be held alter the present one." Mr. M'Lellan—"Hut I want to knowwhy the other meeting is required."

-Mr. Barber: "I'm sorrv—its not open." .Mr. M'Lellan (Heatedly): "Let me tell you, if you don't know it, that anything concerning the company is open lor dis-cu.-.sion now."

-Mr. Barber-. "I rule that the matter is not before Iho meeting. Wc have been directed by our legal adviser that it is illegal to It > otherwise..

Mr. M'Lellan: "With all deference to your legal adviser, 1 say ho is and you'™ ruling is wrong." Continuing, ilr. M'Lellan said that he thought that (he auditor had been absolutely correct. Ho had asked for the production of a share register. That was only what was required by law. He (the auditor) was a shareholders' man. The auditor was quite right to insist on a receipt for every kind of expenditure tor the protection of the shareholders. It was all nonsense to say Hint they could not get the warrants from the bank. He did not know of any company that did not produce them. He hoped that the comIHiiiyswo'nld sec that only b'.'cir fair and righteous, and what ho asked for was according to law. As to tho petty cash, if tho hoard passed'the payment of £12 a year, and got a receipt lor it from Mr. M'Lean, it was all right. . Tho Ten Per Cent. Limit. There was, however, a good deal to be said about tho sharo register. He saw that there had been transfers during tho year. They included parcels of shares to Messrs. Kuttcr and I'itzsimmons. Ono lot had been passed through, not being a transfer by purchase, as all that was recorded was that each carried a 10s. stamp. His friend next, him would like to know if there were any more available at the price. Another phase, of tho matter was that he had been led to believe that no shareholder should own more than 10 per cent, of the share capital. Ho wished to know if the shares which ho had mentioned had been transferred because of that. The Chairman: "Tho shares were propcrlv and legally transferred." Mr.. Laurie: "A block of 400 shares can 1m sold for 10s., or given away for nuthing." Mr. M'Lellan: "In that case they would be evading tho stamp duty—it was merely ovading tho 10 per cent, restriction.'' "I also understand," said Mr. M'Lellan, "that vou are going to .ask shareholders to-dav'to turn iiO.OOl) oidirory shares into preference shares." This he thought was wrong. Otherwise, ho had no further criticism to offer on the balance-sheet. Ho had taken tho opportunity of veptilating what, he considered a crying evil—that one man should dominate the situation, and that the board should agroo to it. Mr. Harbor replied that ho was (mite sure that Mr. M'Lellan knew that there was no law against n man giving away shares in another. It was a matter between seller and purchaser, and it was the dutv of the Stamp Office, to see that it got the proper duty on all transfers. Speaking on the 10 per cent, restriction, the chairman stated that it had been open to question in the past as to whether the rule meant that a person might not hold more than 10 per .cent, of the shares, or may not vote on more than 10 per cent, of tho share capital of the company. There was one shareholder who had held more than one-tenth of tho shares, hut, on no occasion, had anyone voted on more than one-tenth. The report was then adopted. Elections. Mr. W. H. ?. Barber was re-elected a director, and Mr. J. Flocktnn was elected an additional director, on the motion of Mr. Dudgeon, seconded bv Mr. Laurie. Messrs."Bncholz and W. C. Stephens were elected auditors at a (total) remuneration of .£ls. More Trouble. At the conclusion of the ordinary annual meeting a special general meeting was held to pass the following* resolution : "That the articles of association of the company be altered as follows:— "(1) By omitting Article 40, reading 'no shareholder shall hold more than one-tenth part of the capital of- tho company.' "Bv adding the following article to be numbered 23a, viz:—Any newshares issued in pursuance of any resolution to increase Iho capital of the company (whether such resolution shall bo heretofore or hereafter passed) may bo issued with any special conditions, preference or priority either as to dividends or capital, or both, or with any other special rights or advantages as the company may at: any time bv resolution determine, and any such special conditions, preference, priority, rights or advan'nges may be riven or applied by the same resolution to any shores which may have been already issued in pursuance of such resolution to increase the capital, or the members who hold such last-mentioned shares may be allowed by any such resolution to surrender such shares and receive in lieu thereof an equal number of shares issued with such special conditions, preference, priority, right.s or advantages, and paid up to the '■nine amount. u.s the shares so surrendered and upon such terms as to accruing dividends

and otherwise as the resolution may prescribe."

'I'he chairman fonnallv moved the adoption of <"]an=c 1. Latins thai one shareholder had asked for the alteration as, without it, he would decline to lurnish

nny part of the new capital. The directors were not expressing nny opinion; they had no feeling in the matter .and left it to (he shareholders.

Jli'. M'Lellan: "lint'there's n shareholder with more Hum ten per cent, of tho shares."

Mr. llnrlier: "There was when the matter was brought down." Mr. M'Lellan: "1 sec no reason why we should niter the arlicle. It's all rifflit as it .stands. There has always been quo wan who has dominated the'company in the past. ]f .shareholders are content to he led by Ihe nose well and good. I'm against it,"

Mr. Osborne expressed a doubt as to whether it was exactly legal. '■' / Mr. M'Lellan: "If yon like to spend a liitle money yon could upset the business done by the company for ten years." Mr. T. 0. .Mucartliy protested against the trend of the discus-ion, and what was being said about him. Ho thought that some people lorgot what he had done, lie had found the money for the company when it needed it. He had acquired Hie land at (lie back, and ho had negoti-uti-d the mortgage (m it with the company —things that, would never have been dona had Mr. M'Lellnn been a director. Tho company had always been under a compliment to him, and he had never had any tavours lroin the company. He challenged anyone to disprove what he had slated.

Mr. M'Lellan: "1 rise to make a personal explanation. 1 only ask thai things should be done as they ought to be. I can refer to the time when he (Mr. Miiearlhy) was a mortgagee, and also a director, when he ought not to have been. At the meeting before last tha business was ultra vires because the notices had not been sent out in time." Mr. Barber: ".Mr. M'l.ean denies it." Mr. M'Lellan: "He can deny it until he js black in tho face, but it's nona the less true!" The motion was then put, and lost on the voices. .Mr. Macarlliy asked Hint hid objection bo noted. The Preference Proposal. The chairman (Mr. Barber) then put Clause 2 of the above resolution. Mr. W. C. Chatfield did not agree to the proposal, lie said that, no sooner was tho property clear of all mortgages than it was proposed to load it up again. They had their capital cut down once, they had a bank overdraft of JMOOO, and now cnino blow No. 2. They were practically told that they would get no dividends unless they furnished some of (he new capital. Mr. M'Lellan said that nt a meeting held six months ago they had been told that (he new proposal was a great and glorious thing, and if they wanted twice .£'.'lo,ooo they could easily raise it. Now, after six months, they found that they could only raise .£IBOO. There was something radically wrong somewhere. It had been "said that if they did not build a new theatre someone else would, and the chairman had stated that it was Kiieh a Glorious thing (hat they had no right to give preference to the new capital. • "It was," said Mr. M'Lellan warmly, "on those grounds (hat this scheme was allowed to be brought off. You asked us. to authorise this. Now it's all turned out to be something quite different—some thing absolutely against the interests of the shareholders."

Mr. Osborne considered the prcferqiiM idea a sop to the new capital. Mi". Barber reminded the shareholders Hint there had been a syndicate in Wellington prepared to erect a theatre, and it would have been suicidal to allow another company to step in to build a theatre superior to their own. The company had been paying the biggest dividend in Wellington—l 2 per cent. There was no company with which Mr. M'Lcllan was connected that was paying so much, and. therefore he .claimed'that it was a well-managed company. When he had joined the company the shares were, valued at 55., and he took a good deal of credit for the manner in which it had been worked up to its present position. It was peculiar that it was only those, who had declined to take up new shaves w.ho were criticising, hut he would like to tell them that unless the capital was found by which they could give the new land earning power—unless the money was found by the shareholders or Hie public— the interest on it would eat up the dividends altogether, lie commended the reso'tition to tho shareholders.

Mr. Osborne remarked that , he was against4h?- J resoluM<jnV himself had. Raid that a syndicate could come alone at any time and erect a theatre'. They wanted to go ahead—tho directors had already been thrown over once by an individual.

Mr. Maeavthy: ''.Hoes'.lie moan*ihcf'' » r The chairman: "He mentioned no name."

Mr. M'Lellan pointed out that the proposal to grant a preferential dividend on shares issued already without that understanding was not possible. It was not le.eal.

Tho chairman snid it could bo done— thev had leal advice upon-the point. Mr. M'Lellan'rejoined that he had legal advics that it could not be done. ,'On being put the voices were about even;' The ■ chairman declared it carried. On a vote being asked for ..only four (out of the five required) declared in favour .nf a poll, so the motion was do-' clared to lie carried.