Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1915-07-24
PERFECT RIGHT
TO RAISE STOCK
ISSUE IS CLAIM
answer to Attorney-G Generals
Suit Insists That 81 ,600, 600
win Not Be Excessive
DECLARES ACTUAL COST
OF ROAD Is Sill, 04l
Not Contemplating Increase IN
Stock But Has Right to % So
and May Do So at Any Time

The Honolulu Rapid Transit = A4uo
Company, through is attorneys,
Frear, Prosssr. Anderson q Marx and
Castle and wilmington, today fled It's
answer to the complaint set forth IN
q bin for injunction fled against Il
by, the territory through !. n. Stain
back attorney-general, on April 30
last.
II Is declared In the answer that the
company has q 'juEt and legal right
20 increase its capital stock 70. the
sum 81 fl,600.O0 and that although
Il has hitherto taken no action look
ing to that end. X may do 80 at any
time unless restrained by an order Of
the court
The company denies IN the answer
that such an increase, when taken
with the present capital stock, would
far exceed. or at all exceed, the &C
tuaI cost 81 the street railway lines
and Is per cent Of the said cost. In
addition thereto.
The Injunction fled by the territory
was to enjoin and restrain the Rapid
Transit from increasing Its capital
stock to the sum Of t1.o0O.000, or any
amount In excess Of the capital stock
as Of April last, or to pay or attempt
20 pay any dividends on any capital
stock other than the stock outstand-
ing At the time Of the fling Of the In
junction.
The grounds given were that, as pro-
vided By the charter of Incorporation
and By the franchise Of the company.
n would be unlawful for the company
10 increase it, capital stock In excess
Of 100000 at any one time unless
the proposed increase. when talkenl1
with the original capital stock. repre-
scented the actual cost OF the property
or the railway and Mt over Is per
cent Of such cost In addition.
Il was ALLEGED IN the bin that the
amount of tia c6pItal stock 0ufstanQs
In1 last ArII was of the par value !
Of 81 z07 500 and tnt 81 this amount ex-
coedo1 the actual cost 81 the prop.
tfIt 81 the railway ana IS per cent
or such c0stsi1 111ItIoh thereto.
Among other things. the answer Of
the company denies that the actual
cost OF the proptrtyAof the railway at
the time OF the fling of the bill was
S795.l07. and says that the actual cost
az that time was and now exceeds.
the sum Of $2.17l,S SAL.
The answer denies that the amount
OF the capital stock outstanding at
the time Of the fling Of the bill-that
il. stock 70 the par value OF $l.201'
5O0-exceeded the actual cost OF the
property OF the railway and Is per
cent In addition thereto.
Answering paragraph Of the bill.
the respondent says:
.sThat neither its directors nor its
stockholders have taken any action
looking to the increase of its capital
stock 10 the sum Of $1,600!O00, or to
any other sum, but that after full
Investigation BY the Legislative and
executive branches Of the government
OF the territory Of Hawaii. as TO the
amount OF capital stock which the re- |
spondent was then entitled to issue, |
in case 1t should be granted an extern
sion Of its franchise for period Of
approximately 20 years, an act was
passed by the legislature and APP
proved by the governor on April %.
1913. which In terms provided, among
other things. that the respondent
might increase It's capital stock a. Of
january /, 1918. to $780, 900 and
issue to its stockholders Of that date,
or their representatives or assigns,
sufficient additional paid-up stock to
make the entire capital stock Of the
par value OF II 500. 900, which amount
should. with the bonds to the amount
Of 1851 900. then outstanding, repre-
sent the entire property Of the re-
spondent as Of that date.