I GOODWIN'SWEEKLY. 5 M
STOCKS MINES-BY TOD GOODWIN I
a spring house cleaning in paloma I
f rVOME very quick work was performed in the cleaning of the
j wm Palma kitchen".
IJJJ On February 9tli Mr. Braffet, who had before that time
I "- been a heavy purchaser of the stock, insisted upon the stock
being listed upon the Salt Lake Stock & M3ining Exchange. Lorin
Hall, the then secretary of the company, delayed, so Wx. Braffet
went to the president of the company, Hon. Thomas Marioneaux,
with a specific written statement of his suspicions that something
was being secreted which the stockholders were entitled to know,
and insisted upon the immediate appointment of an auditor to check
the company's affairs. The president and directors readily assented,
with the result that certified public accountant, C. J. Wait, was
ftf employed to audit the company's books, and proceeded to the task
on the following morning. The secretary promptly resigned, and
R. D. Pomeroy was appointed in his stead. After two long
days of searching the stock account was balanced, with the result
that an issue of nearly the entire capitalization was found. The
auditor found but 4,000 shares net to be possessed by the company
in the shape of treasury stock.
Mr. Braffet and his associates for
several weeks prior to this time had
been heavy purchasers of the stock,
their purchases having been largely
induced by representations that the
treasury contained 270,000 unissued
I shares.
I The condition of the mine was also
ascertained by the same interests,
through tho medium of experts sent
to the property at their .expense, with
tho result that the stock became very
active, and through the prestige of
new purchasing interests gradually
arose from around three cents per
"J, share to fourteen cents per share,
and for several days Paloma showed
the greatest activity of any stock
dealt in on the local exchange.
I As the audit proceeded it was dis
covered that large blocks of treasury
stock had been issued to the secre
tary and treasurer of tho corporation,
one block of 100,000 shares having
been issued on December 2nd, 1914 to
the then treasurer, Mr. S. H. Taylor,
for a consideration of $200.00. The
treasurer entered the $200.00 on his
cash book to the credit of the com
pany, and three days later checked it
out to the then secretary, Lorin
Hall, who had issued the stock to Mr.
Taylor, tho $200.00 so expended being
for alleged services rendered by Mr.
" Hall, during the year 1913. It was
,& found that tho payment of the
$200.00 to Lorin Hall was not author
ized by any action of the board of di
rectors, and it was likewise found that
tho sale of tho stock to S. H.
Taylor at one-fifth of one cent per
share was without any apparent
authorization of the board of directors.
It, however, appeared that on No
vember 1st, 1914 a resolution was
passed which authorized tho sale of
treasury stock by tho secretary at one
cent per share, and contemporaneously
with tho issue of the 100,000 shares
to Mr. Taylor at one-fifth cent per
share in fact on tho identical date,
several blocks of stock were sold to
different persons in pursuance of tho
resolution at tho rate of 1 cent per
share, all of these transactions being
entered in tho cash book, of which
Mr. Taylor was the custodian, he be-
I
ing the treasurer of the company.
With these facts revealed by the
audit, the secretary was called into
consultation late - Saturday night
(February 12th) and gladly responded
to a suggested disgorgement of 58,
000 shares of the treasury stock,
which the records showed himself
and immediate relatives to have ab
sorbed without apparent authorization.
With the return of this stock to the
treasury Mr. Taylor was called out of
bed, and the suggestion was made to
him that 70,000 shares of the stock
issued to him on December 2nd with
out legal authorization be likewise re
turned to the corporate treasury. Af
ter some discussion Mr. Taylor coin
cided with the views of the new man
agement, and signed an agreement ad
mitting the stock to have been un
authorizedly issued to him, and agree
ing to return it to the company's
treasury as soon as he could get ac
cess to his vault on Monday morning.
In the meantime the necessary trans
fers were made in the company's
books, and the stock credited to the
treasury and cancelled of record. It
is stated that Mr. Taylor has since
concluded to repudiate his written
agreement, and at last accounts
still held the stock certificates, while
the treasury claims the stock by vir
ture of the compromise effected with
him. The corporate officers are not
particularly concerned about the stock
certificates in view of the agreement.
Several small stock issues were
also found to have been made without
consideration to the company, the os
tensible consideration being "advertis
ing." In view of the fact that the Pa
loma has nothing to sell but ore,
which is readily marketable without
advertising, these transactions were
also regarded with suspicion, but no
action is likely to be taken in view
of the fact that but small amounts
are involved. The action of the sec
retary in issuing such stock has some
foundation in precedent, as in the case
of many of the mining companies
"publicity" being difficult to obtain
without a surrender of some corpor
ate assets.
With tho completion of the audit,
on Thursday the 17th, tho Paloma
was regularly listed on the Salt Lake
Stock and Mining Exchange, and a
complete statement furnished the pub
lic as to all of its assets and liabil
ities, as well as the physical condi
tion of tho property. As a result of
tho shock incident to its house clean
ing the stock experienced a substan
tial break, but rapidly recovered when
publicity was given to its affairs, with
tho incidental assurance of proper pro
tection being given to tho rights of
stockholders in the future.
Nothing could be more helpful to
the stock trading business in Salt
Lake City than the taking of such ac
tion in the affairs of many other cor
porations which have given conflict
ing reports as to tho status of their
assets and liabilities, with the result
that investors have been lured into in
vestment to later discover that the
grossest misrepresentaions have been
made.
Tho Paloma has been sampled sev
eral times during the past few weeks
by reputable mining engineers, and all
reports have been good.
Mr. Bra-ffet is to be commended for
his prompt and courageous action, and
particularly for giving full publicity to
his findings. The general public ap
preciation of the expose is manifest
in the fact that the stock has taken
on new strength since the facts were
made public.
EPITAPHS
Here rests the bones of Silas Hay,
The drun fool got too smart;
Ho -looked into a gun one day
To cross a jitney street.
Cincinnati Enquirer.
Here rests the bones of Ezra Tank,
His folly none could throttle;
He got up in the dark and drank
Out of the acid bottle.
Detroit Free Press.
Here lie the bones of Hiram Blaine,
Who trusted to his feet,
And wouldn't take an aeroplane
To cross a jitney street.
San Francisco Chronicle.
Here float the bones of Thomas Groat,
Who on a foolish lark,
Though warned by all, did rock tho
boat,
Which pitched him to the shark.
Washington Post.
Here hang the bones of Johnny Bower,
Who autoed on a spree;
He hit the road at ninety an hour,
And then he hit a tree.
American Motorist.
Here lies what's left of Hank Dis
patch, Who filled his gasoline tank;
By looking in it with a match
Zzzz bank boom, so long Hank. M
Southern Automobile & Garage.
Here mould tho bones of tight-wad H
Hayes
Who wouldn't spend a dollar, H
For motor clubs or good highways, H
Ho died in Lonesome Holler. M
Hoosier Motorist. H
Here underneath this vernal sod H
Is all that's left of Pcto McKay, H
He swore he'd cross tho street, by H
M
A jitney looked the other way. H
San Francisco News-Letter. M
In a rural court tho old squire had H
made a ruling so -unfair that three H
young lawyers at once protested H
against such a miscarriage of justice. H
Tho squire immediately fined each of H
the lawyers for contempt of court. H
There was silence, and then an old H
lawyer walked slowly to the front of H
the room and deposited a $10 'bill with H
tho clerk. Ho then addressed the jH
judge as follows: "Your Honor, I H
wish to state that I have twice as much H
contempt for this court as any man In !H
the room." Youth's 'Companion. ;H
- , H
PROBATE AND GUARDIANSHIP M
NOTICES. lWM
Consult county clerk or tho respective 'H
signers for further information. iH
NOTICE TO CREDITORS. 'H
H
Estate of Jacob Burgon, deceased. iH
Creditors will present claims with H
vouchers to the undersigned at Hous- H
ton Real Estate Co. office, Salt Lake H
City, Utah, on or before tho 24th day 'H
of June, A. D. 191G. H
CHARLES W. JOHNSON, M
Administrator with the will an- H
nexed of the estate of H
JACOB BURGON, M
Deceased.
STORY & STEIGMEYER, M
Attorney for Administrator. H
Date of first publication, February H
19, A. D. 191G. 2-19-3-18 M
NOTICE TO CREDITORS. 1 'M
Estate of Dan K. Keohane, de- H
ceased. H
Creditors will present claims with H
vouchers to the undersigned at the H
law office of S. P. Armstrong, G20 H
Continental Nat'l Bank Bldg., in Salt M
Lake City, Utah, on or before the 24tb H
day of June, A. D. 191G. H
JAMES L. KAMI, M
Administrator of the estate of H
DAN K. KEOHANE, M
Deceased. H
S. P. ARMSTRONG, M
Attorney for Administrator. H
Date of first publication, February H
19, A. D. 1916. 2-19-3-18 M
NOTICE OF SALE OF MORTGAGED
PERSONAL PROPERTY. M
To Whom It May Concern: H
Notice is hereby given that the un- H
dersigned Merchants Bank of Salt H
Lake City, Utah, at No. 764 Snow av- H
onue, Salt Lake City, Salt Lake coun- H
ty, Utah, will at 2 o'clock p. m. on H
(Continued on Page 15.) H
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