Show 1 f Legislation Needed on Mining and Finana t I. I I i 1 Blue Sky Law Under l Fire and Suggestions T To Weed Need Out Obsolete i Discuss P Par ar Value Publishing t Annual Reports and G Exchanges I r BY MANSFIELD L. L SNOW the moment the legislative hall ball doors are open on a a. new sesSion ses- ses sion in wishes rushes a flood of new bills Some Soma aro are good some are arc bad somo some are indifferent This if nothing more indicates an unrest or dissatisfaction dissatisfaction dis- dis satisfaction among the people with existing conditions rears in Salt Lake Lako for another another an nn- Several years ago as the Iho solons were wera gathering g m in other rubbing rubbin of elbows and clash of wits vita and wisdom the tho Writer suga suggested sug sUS' ested to one ono a of the ambitious ambitions young Salt Lake ko lawyer legislators as follows follows fol fo- fol- fol lows Carl why in thunder dont don't you OU win fame farno by making a n record this session on the number of old dead laws you eradicate than by following following fol fol- lowing owing the tho usual custom of making questionable fame famo by the great number of new neV bills you Jon father The governors governor's su suggestion the tho past week to the Lc Legislature to as farM faras far lar laras as M possible restrict the amount of new laws is considered by many as ns one of the tho most sensible things thing'S which has hns come from the tho executive mansion for a long time It is n a fact that the average American legislative bod body is too much inclined to over law the people In England for instance all the laws of years cars maybe placed in a moderate sized room In America it requires great grent buildings That some new legislation along the line liue o of elimination amendment and perhaps ps new Ia laws s would not be bo out ont of way right now in respect to mining finance and stock exchanges is generality conceded L law t J ft th n rat For cor Instance the lUC present UW taxing U IU Ions on vu LUY o par p w uc plus pIn tho the shares is not only obsolete but is ridiculous This should instead instead instead in in- stead bo be on the number of shares issued While tho present law fails of its purpose the tho other would have tho the wholesome effect of holding down th II wild cat stock companies which keep going as long as th they have more moro shares to sell but when ben the sharo share reservoir has finally been emptied then and not ot until then do they thoy hit lilt tho the trail for tho the tall timber timber timber tim tim- ber or serenely glide into final obscuration from which none nono return Of course provision must mast be bo made for the exceptional shares company At present a company with practically no visible assets may capitalize capitalize capi capi- for shares or shares The wilder the tho wildcat wildcat wild id cat usually the tho bigger the mountain of shares it piles up Tho The matter is optional whether the par is 1 mill 1 cent 1 or 10 If the shares are and tho the par 10 cents the annual state tax will rill be say 10 If the par is 1 tho the tax will HI be about The charge for filing also is ishi hi higher her as ns the tho par is increased And nd yet et tho the par par value moans absolutely nothinG to the tho stockholders toc hol ors It moans means so 80 little that In eastern states companies today aro are being or organized with Ith no par value In Utah an obsolete statute requires that some somo par alue bo be named or the articles of oC corpora corporation tion lIon will not be accepted by the secretary secre tary of oC state The The par value too Is a a. snare and a a. menace menaco to tho the Ignorant lie Is told that Hero you ou arc getting a n 51 I 1 stock for lor 10 cents Many swallow V this on only to find out too late Inte that the par value represents nothing that his Ills called so-called 1 1 stock tock may bo be valueless Small Number Count It Is low Jow capitalization that Is Is small numbers of ot shares Issued Id by any compan company com corn pany pan mining mining- or otherwise which I counts For the final test Is the tho divi l And the companies with small stock Issues can tho the more readily pa pay large dividends An Illustration There Thero Is If the Ontario Onta-Io mine at Park City with tho good the good time old-time low capitalization of ot only shares Today It Is popular popular pop pop- pOP pOP-i ular to have ha or more mora shares I In the tho most trifling company compan Thou Then again UH there rc In s IJ tho the Ont Ontario's neighbor the thc Silver SIl King At ono one time the Silver Silver Sil Sil- ver er King Icing had a no low lov capital but now It has issued shares Now Nowhere Nowhere here Is the crux The Ontario pays p a cent BO-cent a share sharo dividend l and reduces It treasury but It if the Silver SIl King ICing pays 60 50 cents It drains its treasury treasury treas trens- ury There Is a difference of oC more than Yet the c et would be the recipient of oC tho the same amount of oC dividend per sharo share of oC stock In both instances But tho the par value of ot the two companies cuts no figure The Thc hugo hUbe share corporations are aro the tho legitimate offspring of ot the tho great modern modern modern mod mod- ern watered stock combines There has been beer a a. great deal dell of ot complaint complaint com com- pl plaint In the past several se years cars from Crom stockholders that numerous companies fail fan to Issue financial statements Stockholders after waiting In vain aln for their newspapers to give he them this irn- irn Important important Im im- Information write to tho companies companies companies com com- but huL got no replies or replies no o incomplete that they arc are tor tory In adjoining states Nevada l for Cor Instance all incorporations are aro re required re- re q to publish a small but complete completo statement at least on once co a year ear This must contain the amount of ot cash on hand ik expenditures o or of the Hie past year ear In Indebtedness Indebtedness In- In and other Information of It vital 1 Importance c. c Information to which er c oven cry holder of oC at ck In a company company company com com- pany Is entitled b by right rl-ht of ot his hla ownership ownership owner owner- ship In that corporation and ond property Just because some somo crowd owns 0 n a large lame control of ot a company compan is la no good boad and sufficient nt reason that lt mn may with Impunity keep hl hidden tho the financial lal tatus status of ot that company compan Undoubtedly Undoubted there thero ate are tens lens of aC thousands o of stockholders stock stock- holders In Utah today who would auld sing praises to the man who wha fathers some somo such a reform bill Then Thell again Is the recurring ever demand for some soma sort nort of reform of 01 min l lug G oil uil and industrial exchanges New V e York Massachusetts and other great eastern eastern states etalea havo have seen fit to curb the possible reckless operator had And b by thus curbing the iho ruthless vampire am pire piro on ignorant men and women tho the I honorable and legitimate broker Is la I helped Helped e It is t rightly pointed out that legislation alan along this line lino is g I I close to inalienable rights of oC man but buta a certain amount of oC the blue sky Is sometimes necessary to Inject into cloudy places of or human humm endeavor Its It ItIs ItIs Is s thought that tho the one requirement that all nil exchanges es open to the public their dally daily transactions would go bO along a along long JanS' wa way In eradicating tho the com com- of n e evils evih Match sales s w ath sales and juggling julIn generally would be reduced to tu a a a- minimum b by this and a a. businesslike lIke clearing house Ce feature ture nIl lug Men cn Auk Ask For Tor n Re form It was about a year r and a a. half halt ago that of oC the most mast prominent mining mon men of oC the state jud Judges es of ot tho cu- cu promo premo bench bankers and others 11 signed I 11 cd and sent ent to tho the local mining exchange a n. petition calling for tor some somo of ot these re ro- ro forms Corms The rhe president of ot the exchange presented this petition to the governing governing govern So ing bo board rd with this cryptic sentence Gentlemen here Is fome something we cannot cannot cannot can can- not afford to ignore Rut nut It wa was Tho The following Is taken from t-om that petition pe petition pe- pe calling caBIn for Cor a clearing house I 1 feature e turo Our solo object Is a n betterment betterment better bettor m ment nt of the exchange From Irom lon long observation observation observation ob ob- it t Is lt our honest Individual belief that tha t ruch Fouch a feature would In time lime result in permanent and Immense benefit to tho the public to the tho exchange and to tho brokers themselves es In our opinion such a department would bring about wholesome reforms which an observing public demands and re reestablish rc- rc establish confidence In the exchange resulting In great good bood to the community community community and a n. conspicuous increase in n the bu business We nc 0 believe that this exchange can n and will t be bo conducted in euch such manner that the mine operator ml may feel that his listed stock is safeguarded that tha t the prospect owner ma may feel feol that In listing ho w will be benefited and hiss his s stock ock not nat juggled that tho the patron of the exchange may feel Ceel absolutely that tha t he will bo ho given on I a square deal and the dally daily sales open for or his inspection ap apu d finally that our mining exchange ma may prove o worthy of ot the name the representative representative e of 01 a n great western territory Utah Is not alone in looking to re reforms reforms re- re forms torms In this direction The pot pat i is s boiling up in the great northwest over In our aur neighbor Colorado and in other states state Here is a a. late report from I I Spokane Wash 1 It suggests crying re reforms re- re forms in the tho present lax matter of ot perI permitting permitting per per- I corporations to sell ell stock broadcast which have ha little or no tangible tan tan- Bible gible Ible assets Often a company is le formed forme d 1 in Utah and hundreds of at thousands o of ot df f shares sold when the tho only asset Is a lease Jease and bond band which cannot possibly I be met Tho The Inevitable Ine end of such concerns IB is loss lass and disappointment I Tho The Spokane report repart follows Provision Pro for tor tho the regulation of ot stock companies while avoiding the essen features of ot blue sky ky laws is tho the object oCa of ot a a. plan now naw being worked out b by tho Northwest st Mining R association which discussed tho the problem lem lcm at a a. recent session here A committee com corn motet appointed to draft a proposed propose law Jat recommends that thit com companies panics be re required to file Clio with the secretary o of 01 state and th the tho auditor of ot the county count In which the company compan Is organized a D verified statement giving the number o 0 shares hares of stock In tho the treasury th the location and ond d description of at tho the property proper t ty tho the nature of title held the amount amoun Continued on nn Following Paro NEEDED i iN N MINES AND fiNANCE Continued from rout prece preceding page Lf Ifor r the tho claims and 11 the thc terms an and Hints utis of any deferred payments J Jf if C CUt ues Ut a prospectus or literature conlIng con- con lIng C the properly property copies shall shaH be Ic liln Un the tho same Bame wa way was with wIh a n state state- l tot of the development c if l an any th that t been done ono on the property When hen henl l are arc filed with the pry of oC state he shall shan Issue 0 n a per per- authorizing the sale of or stock In iU n It Is recommended that I t tem shall shall- shall shall-be be filed fied the tho first t itch ch year car and also a. a statement of o I amount l f C treasury stock sold Bold the gons lt obtained from sales the tho com coin I sons pd paid the amount of or develop develop- clop do t worl done anti ami equipment per pur- 1 dV The committee will wil later Sulho sub sub- ho draft of ot a lull bill hi to b be presented I hc state legislature Blue Sky 1 I ero tre ee is a rather radical opinion ulon on under the caption capton oni and Blue hum In Idaho the tho cn- cn Mining and Financial Record says I wording to Mining Truth that f fw Vash sh p publication has been ed edIn ln possession o of a copy of or the I I law drafted ratel b by the Washing Washing- Association of or Commercial Or Orian- Orian anon an- an ton on Secretaries and which It Is pro- pro df af to lay before tho the forthcoming It I does doe not take tale much rito Ito Ita convince the tho open mind that thal I and restrictive In I its scope cOPO entirely Inimical to the business of or this state l the he first place It gives unlimited r rt r to ono one man and imposes upon it t dealers restrictive rc regulations Would entail an endless s amount lount elca work to no bOO good purpose Instance stance section 7 provides pro that I lealer ealer In securities must secure a tto to do o business from the lie tle secre- secre Ip pf t state who shall be the sole oC of the lie applicants applicant's moral I tit fit t r Io shall hal also I file a sla statement J els an anu and anti such I information as the secretary ms may tX i Upon the first da day of oC eer every 1 I ea h licensed dealer shall shaH file le it t toC of oC such stocks bon bonds s. s notes I acts or other securities on hand handIe Lie ale Ie or handled handle during durInG the prec l- l nth providing further t secretary of state stalo shall ahall hal have haverl rl to prohibit sai said dealer from Ung n of ot such issues at 1 any at any Y shall be satisfied that j guilty of ot fraud ml I I ull or t ton ton Oa in thc he sale of oC nn any such j cand c c- cles les fes and If th the dealer shall refuse bey the order made h by tho said lc Ury Urr of or state tate his permit D lila may beed bo be ted ed b by the tile secretary of or state of DC al any aJ aggrieved c person in n any court hain having Jurisdiction h 1 correction of or such decision if iC if ama ate be erroneous or unjust or 01 out t Jurisdiction In other J I of oC state Is to 10 be Ic tho the solo er cr of or the moral character of or I ns s of state engaged In the or of all classes of ot securities not pled led un under er section 2 and ho Is 15 to be the sole Judge of the J r such securities Once a year cr ts 8 are ire required to file tie a statement ota IOtA and liabilities and such other information as ns the tue secretary ma may shall ic e. e all Any dealer failing Ailing to so re- re i i I forfeit his hla right to do bust bust- jin th the state slate an and shall be e to subject ther I penalties as provided ed Sec Sac 1 Le Ii Provides pro lla that t any nv dealer n 8 ali any PIO of or tue the act lia guilty gUity o or f nime and upon shall thal lie fIned for tor forr or each ori ot- ot i not more r tha l not thU or In rt moro more tItan five n y |