Arizona republican., 1916-10-25

eye on the mine development of the state
 In the eyes of the law there is no such thing as organization stock, according to Secretary Sangster. F the company is not organized, he claims there can be TO stock, and until the company is organized il cannot obtain permission from the commission to sell stock, and not then. until the commission is satis- fled that the proposition is not of the wild cat nature.
 The Blue Sky Law" as the in vestment control law is called. will be nullifieG in case no restrictions are placed over the sale of stock, according to Sangster. He stated that any group of men could form q company, sell pre- organization stock without having tc make an account
 ing tn anyone, and do with the money as they pleased.
 , It was stated at The offices of the commission that they are not doubt ing the motives Of the promoters. They are simply following in the .te Jerome district. l: has been , the common procedure to promote company by selling pre- organization stock. ard up to this time the com
 mission has not interfened. Hun
 dreds of thousands of shares of this
 variety have been sold. and thus far no one has lost a dollar through it sale, but 1t is to block future man ipulations that the action is being taken.
 !! The Company's Side ? Yin Fortune arr iVed in Phoenix yes terdav to represent the interests of 4 the two companies here He an i nounced that F S Clark. an attorney 1 of Prescott and Jas. WesterVelt of ! Jerome will he in Phoenix today. and 1 in company with Geo $ Stonema-, l the matter will be talked over with 1 the corporation commission. ! Fortune states that the honesty | of the actions of the two promoters i has never been at doubt. They are 1 both well-known in the Jerome dis trict. and have promoted several ven i lures which have been entirely satis% ! factory.
 i They are acting on the theory. that i in order 10 get money to organize : their companies they must sell the ] pre- organization stock With this money they put on their advertising 1 campaigns. to sell the treasury stock i The pre- organization stock is worth as much as the treasury stock. and ! tt -flN tH tflf Stiilf- fVflS4f't 'tl lljfl. IT
 some cases. where pre- -organizati tion stock has been sold: receipts have been given for the money. the stock to be held in pool for one year 1 According 10 Fortune. they have no desire to get aTo1nd the invest ment laws. but believe that they have a. legitimate right to rais' money in this manner to set theil companies on fcot The case vii tnct he fosght through the courts as they consider that to do so. wou,J I ieopardize the interests of the min
 ing game in Arizona If the cas,
 goes against them. they Will act upoI
 the advice of the corporation com . mission and take steps To put tn re-organizatiCn stock on a prope basis. Commissioner Jones statet yesterday that pan could proba
 bly he found to work out of tn
 tanglc.
 In the meantime the promoters Q the Jerome district and other dis tricts are anXiously awaiting the out come of the friendly contest. If tn pre-organization plan is declared file 2 gal steps w:H 1e taken to amen
 matters. Thennds of the eompanie . will be held in trust pending actio T of the exploration commission -I In Jerome
 \ meeting W1s held of the pro