The officers of American Realty Trust debated acrimoniously for more than an hour yesterday with angry stockholders who demanded the trust sell some of its property so it can get out of debt and pay dividends again.
President Thomas J. Broyhill said American Realty is "not going to hold a firesale" but will sell properties when it can.
When Broyhill vowed that the trust would have its bank debt and paid off by next year and be prepared to resume dividends, a man in the rear shouted, "you told us that last year."
The entire meeting went like that, with Broyhill defending, arguing and explaining until he finally admitted "I'm getting a little testy" and tried to and the debate.
Company critics dispensed with the usual annual meeting courtsey of identifying themselves for the secretary and instead shouted questions and advice to Broyhill.
When a shareholder complained that American Realty's officers are overpaid, Vic President E. Carl Hengen jumped to his feet to respond that he was being paid only $5,000 a year by the trust.
"I lose more money from the time I take away from my own business than I make from this job," said Hengen. "If you know somebody who's qualified to run this company and who'll work for less, I'd like to find them."
Organized as a real estate investment trust, American Realty has been denied the tax advantages of that status by the Internal Revenue Service.
For two years the company has been in a complex legal battle with the Securities and Exchange Commission, which contends the company made false reports to shareholders in an attempt to hide its financial problems.
Broyhill said the company is still digging out of a hole it fell into during the recession of 1974 when, like most real estate investment trusts, it became-badly overextended. The company was forced to repossess several buildings and parcels of land when customers could not continue to pay for them, then had to pay banks as much as 3 percent more than the prime rate to keep the property, Broyhill said.
Broyhill said the company is currently negotiating with two potential buyers of a major Atlanta property that could be used to pay off one of two remaining bank loans.
He said other short term bank loans will be converted to long term mortgages and the company hoped within the next few months to pay the interest on a bond issue which is now in default.
Stockbroker W. Lincoln Mossop of Providence, R.I., urged American Realty to sell enough properties to pay all debts. Broyhill and other officers insisted the company would better off keeping its assets as long as possible.
When a stockholder complained about the low price of the company's stock (1 7/8 bid, 2 1/4 asked) Broyhill said holders should be buying more instead of selling because the assets are worth "several times" the market price of the shares. He said he has purchased 35,000 shares of the stock in recent years.