The Detroit times., 1917-02-23
MOTOR
CONCERN IS
NOT BANNED
Securities Board Is
sues No Order On
Continental
L. w. GOODENOUGH
EXPLAINS ACTION
Financing of Hug e
Company Declared
Sound

News dispatches from Lansing TO
the effect that the Michigan securi-
ties commission had issued an or.
der restricting further sale OF stock
In the Continental Motors corpora
ton on the ground that II Yas wa,
tered, were branded as untrue when
members OF the commission were
asked Thursday to confirm the re
port
l. w. Goodenough, counsel for
the corporation. also issued a state.
ment denying that the commission
had issued any order. and explain
ing the situation in detail. The
statement follows:
The article printed Thursday 10
hardly fair statement OF the situa-
ton with relation 10 the stock OF the
Continental Motors corporation.
The company now operates two
and one in Detroit IL employs over
5000 men. 10 is the largest manu-
facturer OF gasoline motors in the
The business. has grown with such
great rapidly that Il has been nee
essary 60 retain practically all of the
earnings of the company.which have
been lsrg.. 10 construct plant sddi-
lions and equipment to meet the
Last fall IL was thought advisa BILE
10 rennance the company on q basic
which would give IL adequate work
ing business. Several of the fore
most bankers OF the country were
consulted In relation TO the matter
and plan was worked out which
4.ss
the company was accordingly capt.
talised at figure Commensurate
with It's earnings. and the stockhDd-
srs all shared on an equal basis In
II was considered that it's actual
value was worth vastly In excess os
tangible assets and this opinion was
shared and counselled by many men
Las, year the company had an
earning capacity az about S25oo. 900.
and with the increased facilities
which II has this year. its earning
capacity should be considerably aug
mented. The public appraisal Of the
value OF the stock Of the old com
psny wF about four times it's par
value and The present appraisal OF
basis. The stock II selling on the
market at about the same ratio as
the stock OF other high-class motor
eompanies similarly REGARDED.
EaniEed the Blue sky" law OF Michi-
gan was complied with and the stock
was listed In the standard Statistics
Bureau manual and dealt IN on the
Detroit stock exchange In response
60 n. telegram from the Michigan
securities commission that the stock
was exempt from the provisions OF
had been complied with, and the
stock listed. A few weeks after that
the securities commission requested
n hearing. which was had. In which
the full facts were laid before the
body. In the second hearing. held
Wednesday. Feb. 81. the commission
requested. although no formal order
more than So should be paid upon
the common stock until $1,000 900
had been added 10 the assets OF the
company rs shown by the statement
No attempt has been made 10 vio-
late any law. or engage in any high
Abandoning The new corporation
has ocen capitalized at a fair value
mon stock alone. after all payment
% dividends on preferred stock. will
on present figures earn from - 70
20 per cent per Rnnum The COIN
pany ~ in stronger financial condi-
ton than at any time In its history.
No stock was sold for payment Of
dividends In making the sale from
the old company 90 the new there
was cash consideration paid TO the
their stock.
The company from its beginning
has been conserVativsly managed
with practically no change In man
aRement since tho inception OF the
company about IL years ago.