Evening star., 1953-12-09

q. (By Chairman Payne }
Turning to the October, 1851,
split of Capital Transit stock,
Mr.. W0lfs0n, which was on a
fOur-tO-One basis, wonder if
you could give us any informa-
tion as to who originated this
particular proposal?
A. Gentlemen, I don't recall
which one of our directors made
this suggestion. but the reason
it was presented to the board
was wider distribution of stock
Since this split, we have added
approximately 300 additional
stockholders to the list.
@. Would you agree with testi-
mony given before the Public
Utilities Commission and the
Interstate Commerce Commits
sion by spokesmen Of Capital
Transit that the purpose of the
stock split was to increase pub
lie participation and thereby in
crease public interest in the
company?
A. That was one of the prin-
ciple reasons.
@. / wonder if you are aware
that, according to the annual
report filed by Capital Transit
with the Securities and Ex-
change Commission, that as of
March 13, 1850, there were 2,225
stockholders and as of March
13, 1858, there were 2,227 stock
holders of record, or an increase
of two?
A. There must be something
wrong. I have records showing
800 increase.
| @. 1 am taking the report filed
with SEC.
A. On March II, 1851, the
number of stockholders was
| 2,O13. The annual report for
1852 shows 2.270. Since then, I
understand it has increased
slightly to give us approximately
300 as Of March IL. 1858.
@. Let me ask you if you be-
lieve the stock split has been of
benefit to the riding public?
A. Well, maybe it doesn't have
any benefit to the riding public.
But we thought from the public
relations standpoint we could
have more owners, and it would
help us by having more people
vitality interested in our opera
tionS.
@. Would you care to give a
figure of what percentage of the
total stock now is owned by you
and your associates?
A. OF the original nine in the
company a total amount
of 1888 per cent Of Capital
Transit stock.
@. That is as of today?
A. No, sir. / believe there is
a little increase. I believe my
brother, Sam. has purchased
some stock for gifts for his
children.
@. You are familiar with this
book, Facts About Capital
Transit" in which, on Page 81,
it shows that the Wolfson fam
lily and Wolfson interests
and associates :. own the
equivalent of SO per cent?
A. That includes friends Of
the Wolfsons-not the original
people who made the purchase
from North American.
@. You control So per cent
Of the stock?
A. I think 1t is greater than
that today.
@. Now when you and this
particular group decided that
this was good company to buy
you were satisfied that it
was cOnServatively operated in
that all its reserves were not
being paid out in dividends; that
it was being kept in reserve for
possible expansion of service?
A. We realized that they were
a little too conservative as far
as their dividend policy. When
suggested program Of buying
200 buses and seeing if we could
bring in more modern buses "a
report came in) that we didn't
need any new equipment at that
time.
@. The total income has been
approximately SIT million (fOr
1852 and first nine months of
1851 and the total dividends
which have been paid were
$4,896, 900 or more than 2L2 times
the net income. Do you think
normally it is a sound policy to
pay to the stockholders dividends
that are largely in excess of the
actual earnings of company?
A. Normally and ordinarily I
would say, no. But under the
situation that existed in this
operation, I believe it is good
business. and revenues should
have been distributed in prior
years and were not distributed.
If we had five times as much,
we couldn't run any better
service. 1t had no bearing on
our operation.
@. Then you think the divi-
dend policy that has been
adopted by your group is in the
interest of good business judg-
ment?
A. I believe that, if this corpo-
ration can maintain a $1.60 an
nual dividend, I think that is a
satisfactory return to the stock
holder. If we can consistently
pay this dividend, I don't think
the directors will come up with
any other dividends. We have an