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EXCELSIOR HARDWARE COMPANY
Registration Sheet September 2002
“A tough but nervous, tenacious but restless race (The Yankees): materially ambitious, yet prone to introspection, and subject to waves of religious emotion . . . A race whose typical member is eternally torn between a passion for righteousness, and a desire to get on in the world.”
Maritime History of Massachusetts
Samuel Eliot Morison
The 19th century, with the Industrial Revolution, the railroad and the gold rush, was an entrepreneur's delight. An idea, an invention, a small bankroll, borrowed perhaps, and a healthy dash of chutzpah—that's all it took. Where one attempt failed, another might succeed, sometimes in an entirely different field.
Born in New Haven, Connecticut in 1850, Elisha Mix, Jr. ,Yankee, met the criteria. His father enjoyed several careers; sailor, Seminole Indian fighter, farmer, and finally toolmaker, all before serving with distinction as commander of the 8th Michigan Cavalry in the Civil War. Elisha, Jr., a boy of 12, went to school and helped run the farm in Manlius, Michigan while his father was at war.
After the war the family moved into Allegan where the returning cavalryman had bought a store. Elisha, Jr. left school, went to work for a news dealer and soon bought the business. Advertising prospered, with the result that the local paper forced the new firm out of business. He then went to work for his father who had sold the store and was managing a foundry and machine shop.
When in 1870 his father took over the Wyandotte Agricultural works, Elisha, Jr. joined him and later worked for two other machine companies until April 1873. By age 23 he had had a part in several businesses, his and his father's. His uncle, Frank Mix, offered him work as an apprentice tool and die maker at Eagle Lock Company in New Britain, Connecticut. There he was kept on through the panic of 1879 when others lost their jobs, and there he met Fannie Williams, later to become his wife.
In 1875, eight men from Eagle Lock, including the three Mixes, formed Bridgeport Lock Co., located in the old Wheeler & Wilcox factory building in Bridgeport and in December Elisha, Jr. and Fannie were married in Terryville, leaving that afternoon on the train to Bridgeport.
Changing trains at Waterbury, they saw signs of a fire in the distance and were held up an hour by the blaze, which they learned was in the old Wheeler & Wilcox building, close to the tracks. Elisha led a group of men in battering out one end of the building to rescue machinery and work in process. Recovering from this disaster, Bridgeport Lock prospered, doing so well they posed a threat to Eagle Lock Co. In the harshly competitive spirit of the times, Eagle offered to buy them out. Always there was the barely concealed threat, "sellout or else." So—they sold out and all went back to New Britain and work at Eagle Lock Co.
By 1883 Frank Mix was with Corbin Cabinet Lock Co. in New Britain. He sent for his nephew to join him and Elisha, Jr. built a house and settled down to live, permanently he thought, in New Britain. In 1891 Henry Towne sought out Frank Mix to come to Stamford to start a cabinet lock division at Yale & Towne. Elisha followed with his oldest son, Moseley, and Frank's son. In Stamford Elisha bought a house at 13 East Park Avenue, later Pleasant Street. While at Yale & Towne, each of the four Mix men was put in charge of a department almost immediately.
During the winter of 1895-96 Elisha was seriously ill with a form of grippe or pneumonia, and on recommendation of the shop doctor, Samuel Pierson, he took a month off to recover. Henry Towne, of course, did not pay for sick time and then sent for Elisha on his return to work. There he advised Elisha that since the department he headed ran so well in his absence, his pay would be cut. Elisha protested he had begun with six men, by that time had 20 men working for him, at no increase in his pay. Towne was unimpressed.
The real estate market was depressed and Elisha had no choice but to stay in Stamford until he could sell his house and move on. With two other Yale & Towne men, who had been planning to leave the company and go into business, he entered into a partnership for the manufacture of hardware and "such other lines as they may mutually agree upon." Joe Horne, one of the partners, had by this time decided to give up his manufacture of bicycle pedals.
Working out of the old Bridgeport Power Co. building in Bridgeport, the third partner, Charles Erickson and his brother, produced 200 dozen locks which were made in the name of C.A. Erickson Company. J. Goldsmith & Co. in Newark were interested in buying these locks but were reluctant to have the lock trust know the manufacturer's name, so the locks were stamped "Excelsior Lock Works, Newark, N.J." and sold by the "Excelsior Hardware Company." Excelsior is a generic name for a type of trunk lock widely used at the time.
In May 1898, when Erickson had to sell his share in the partnership due to poor health, Elisha gave notice to Fred Towne, borrowed from his wife, his father and a friend and began manufacturing in earnest. He continued selling to J. Goldsmith, who by this time were ordering a second lock, designed by Elisha, which lock was also being sold to Hammacher Schlemmer. In 1899 Yale & Towne discovered the true identity of "Excelsior Hardware," and fired Elisha's son, Moseley, who then joined his father. Business began to pick up and orders came in from ever-widening circles, by that time reaching Grand Rapids, Michigan.
In the Spring of 1899 everything was going so well, it was decided to move the business to Stamford. For $15 a month, they rented an upstairs ell of the Smart Hat Factory on Crosby Street. Power came from H.A. Tuttle, a car maker next door. When Mr. Tuttle gave up on car manufacturing, Excelsior moved into his space also, and then moved once again to East Walnut Street.
Nineteen four and five saw the beginnings of the panic of 1907. Steel was difficult to obtain, but Excelsior managed to stockpile a supply. When the panic set in and orders slowed down, the precious steel supply went unused for a time. In 1910 Elisha bought land on Woodland Avenue and built a 150' x 50' wooden building with a brick veneer, which is still standing at this time.
On June 27, 1910, at the offices of Cummings & Lockwood, Elisha, together with sons Moseley and James, held the first meeting of the incorporators of the Excelsior Hardware Company. The duly approved Certificate of Incorporation had been filed May 10, 1910 with the Secretary of State of Connecticut and a copy filed with the Stamford Town Clerk on May 11th. Their stated purposes were to manufacture various types of locks and hardware, to obtain machinery and equipment and to acquire land as needed. Capital stock of $25,000 was divided into 1000 shares of common stock with a par value of $25. Duration of the company was to be unlimited. By-laws were written and annual meetings were to begin January 23, 1911.
At the June 27, 1910 meeting, Elisha transferred the Woodland Avenue property, valued at $13,000, to the new corporation. The property was encumbered with a $5,000 mortgage held by Frank Hoyt, who owned or had mortgaged much of downtown Stamford. At the same meeting, Elisha, Moseley and James transferred title to all business property and equipment to the corporation, a value of $15,000. The new corporation then opened an account with Fidelity Title & Trust Co., 129 Atlantic Street.
The three stockholders treated themselves well, drawing good salaries and driving company-owned cars. In 1913, Elisha's 21 year old son, Clarence, was made a director, and in 1917 each of the four was drawing $12,000 annually in salary. This was a princely sum at a time when a good-sized house could be built for $2,500. In January 1918, when Clarence left for the service, his salary was temporarily reduced by half.
War production was profitable and in January 1919, the capital stock was increased and at the annual meeting it was voted to purchase the so-called Tuthill property from the four directors for $18,000. This property adjoined the Excelsior Woodland Avenue property and extended to Atlantic Street. Business was doing well, dividends were regularly declared and paid and in December an additional $5,000 in salary was paid to each director, bringing their salary for the year to $20,000.
Meanwhile, with the improvement of the already existing product line and newly developed items, the line was extended and catalogs were being issued annually. At about this time, a Spanish language catalog was issued for South American buyers.
Then came the depression of 1921. Officers' salaries were cut to $10,000. Operating expenses were cut and purchases restricted to items deemed absolutely necessary. Lack of orders and resources taxed to the limit led to cutting the work week to 24 hours in July of 1921. The hourly rate was not cut, but all unnecessary help was temporarily laid off and officers' salaries were cut once more to $5,000.
By March of 1923 the unsubscribed stock was being offered to stockholders of record at $12.50 per share and in January 1924 a 6% dividend was declared. At the February 1925 annual meeting of stockholders, it was reported that the company's net worth had increased to $402,472. New agencies were opened in Cleveland and in Petersburg, Virginia and in 1925 export business increased, mostly to France, Norway and Argentina. In 1927 Clarence Mix was appointed Assistant Secretary-Treasurer, and from 1925 to 1927, dividends were regularly declared.
Elisha's initial company, housed in part of a building in Bridgeport, had grown to cover some two acres of land with access to Woodland Avenue and Atlantic Street. Old-fashioned by today's standards, its machinery, run by overhead shafting, was state-of-the-art for its time. The buildings were large, with oversized windows, and production progressed in fairly orderly fashion from one department to another. The stamping department began with flat raw stock and stamped out flat items. Then to the punch presses for secondary operation of bending and punching holes. After World War II, these operations were combined in one by the use of progressive dies, which moved the stock along in two or more stamping and forming operations at the same machine.
Plating and finishing took the formed piece and produced the polished finish and then assemblers put the parts of the individual item together. By tradition, locks and similar parts, hasps, hinges, corners, etc., are sold in lots of 100 dozen and in these quantities they were shipped to all parts of this country and many foreign countries.
Excelsior's tool room numbered about a dozen men in the 20's and 30's. Elisha had been instrumental in bringing a trade school to Stamford (rather than Norwalk) and each year from the school's graduating class Excelsior chose from the top graduates as many as they needed to train as tool-making apprentices. Some of these apprentices were employed as journeymen at Excelsior and others were welcomed into other local companies. In later years as the tool room expanded, whatever equipment was needed was bought and older machinery updated.
In February of 1930 stockholders at the annual meeting learned that the company was anticipating sales of over $400,000 that year. A new group, consisting of Albert Komenack, Ollie Bloomfield and Paul Plepis was assigned to the design and improvement of locks. Elisha's 80th birthday was mentioned.
The Depression began to be felt in 1931. Sales were down 12% in February. By December, sales were 57% below the previous four years average. The directors' salaries were reduced to $4,200 each, although president Elisha continued to receive $6,000. For most of 1931, Excelsior was 42% below normal and in December the capital stock was worth $39.35.
In an effort to keep busy and provide employment for those working in the shop, various products requiring custom stamping were made. These included commercial ice cream scoops, razor blades, meter seals, leatherette hair curlers, shoe display stands, price ticket holders for shoe stores, and remote controls for model sailboats.
By February of 1932 the capital stock was worth only $28.54. Business was being lost by the company's refusal to lower prices below the profit level. Some business was lost to a competitor who did just that. Said competitor subsequently went into receivership.
Salaries continued to decrease. Elisha, in 1933, was receiving $5560 and the other three directors were paid salaries of $3320 each. In all departments of the shop every effort was made to lay no one off. Hours were reduced, pay rates were cut and in some instances where a husband and wife were both employed, the wife took a leave. In this manner, whatever work and income was available was shared and no Excelsior employees were left destitute. By 1934 it appeared that things were looking up. Business in 1933 had been 70% better than in 1932. Top salaries, however, continued to go down, with Elisha paid $4800 and $2400 being paid to the other three Mixes.
In 1934, Elisha's oldest son, Moseley, his right-hand man, died. James was named General Manager.
Small indications of business improvement continued to appear. One hundred dollars was voted for painting the factory building and vacations for office workers and foremen were approved. Elisha Mix died in Florida in 1936. At the 1937 annual meeting Ralph H. Mix proposed a resolution in memory of his father, the company president. The resolution said in part, "that his righteousness, and fairness should always continue to be the standard of this organization." At this meeting Earl Mix, Moseley's son, was elected president.
Fall of 1938 brought the memorable Hurricane and tidal wave. Damage in Stamford, especially in the South End, was considerable. Excelsior suffered losses of large amounts of finished goods held in inventory, as well as damage to machinery. The total amount of loss was large enough to threaten the tenuous financial stability of the company.
By 1940, with war in Europe a reality, Excelsior began purchasing larger quantities of raw material. By July 1941, raw stock deliveries were slowing down, due to the effect of the government's priority system. In 1942 arrangements were made for employees to begin purchasing defense bonds by payroll deductions.
During World War II, in addition to their regular hardware line, Excelsior also manufactured drawing dies for all sizes of cartridges and outer containers for multiple contact electrical connectors. Like all other businesses, personnel shortages were felt, as men left for the service, including members of the Mix family, and by 1943 the company was doing 95% war work.
In 1943, a committee was appointed to proceed with installation of a pension plan. Said plan was presented at the November directors' meeting as the "Excelsior Hardware Company Employees' Pension Trust."
After the war, in 1946, a lot facing on Woodland Avenue was purchased where a new office building would be built. A 10% raise was given employees in April of that year. Lack of help continued to be a problem. By 1948 four paid holidays were decided on, Decoration Day, Labor Day, Thanksgiving and Christmas. A second shift was added which was still operating in 1952.
By the end of 1954 two additional holidays were added, New Year's Day and Fourth of July, and it was recommended to purchase the former Boys Club property on Pacific street. In 1956 the Atlantic Street apartment house was demolished and the property between Excelsior and Excelsior Plimptruck Co. was aligned by an exchange of property. The former Boys Club house was rented.
All directors were concerned with the daily details of efficient factory management. Clarence Mix stressed the need for a training program for sales personnel and young executives. Irving Branch, a director since 1951, met with Earl Mix to discuss ways to improve statements, cash and profit positions, and to study ways to reduce factory overhead and excess overtime.
In December John Mix urged rebuilding the press shop and Earl agreed. At this time the first mention was made of the move to plastic luggage which would require changes in manufacture.
The later fifties and early sixties continued much as before, with attention to changing luggage styles. Gifts were made to local agencies, wages and vacation times were increased, and overhead shafting began to disappear. By 1965 the press shop was again working Saturdays and a night shift was reinstated. Duplicate dies were being made in order to increase production.
A union election resulted in a defeat for the unions in 1967, but in 1968 the Tool Makers Guild succeeded in signing up the tool room, and wages and benefits were negotiated. There was, however, general agreement that no great benefit was derived from the union membership. Wages and benefits had been and continued to be well thought out and distributed by the company.
The Pacific Street house continued to be a problem, even with a rent increase, and it was mentioned that the house would be demolished when the family then occupying the house finally vacated.
In 1969 Clarence E. Mix, youngest of the Mix brothers, died. He was the last of his generation involved in the management of the family business.
A new series of locks and drawbolts to be made of plastic, was begun in 1969. Two properties on Woodland Avenue were purchased. In July Paul Plepis resigned and Ralph T. Mix was named shop superintendent. During his tenure in this position all overhead shafting was finally eliminated.
The 70's began inauspiciously with a six month loss of $100,000. The year 1971 continued with depressed sales, but by 1972 the worst of the recession appeared over. Anti-pollution laws and safety and health rules required considerable expense. OSHA requirements for equipment and safety fixtures cost an initial $35,000, and by the date of the February annual meeting it was feared these costs could rise to $150,000 or even $200,000. At the end of the year the energy crisis was a threat, and changes to the plating department cost close to $50,000.
Foreign competition continued to draw business away from the company. Copies of Excelsior products were made in Asia and even in Germany, selling of course at considerably less than American made originals.
1975 saw the closing of Eagle Lock Co., Excelsior's major competitor. In August 1976, Earl L. Mix died. He had been president of the company for 40 years and was succeeded by his son, Coleman.
In March 1977 Coleman Mix died. Filling the office of president of the company was extremely difficult. At the March 9th annual meeting directors elected were Joseph N. Ferrara, John B. Humphries, Ralph T. Mix, Reginald Connolly, John S. Mix and John Sullivan. Joseph Ferrara resigned from the Board March 27th and was replaced by Carol Mix, Earl's widow. Officers then elected were: Carol Mix, Chairman, John B. Humphries, Vice President Sales & Marketing, Reginald Connolly, Vice President and Treasurer, and John S. Mix, Secretary.
In November 1978 Reginald Connolly was elected president. Robert Kahan became a director in 1979. A workroom at the Rehabilitation Center was to be named for Earl L. Mix. An EDM (Electrical Discharge Machine) was ordered for December delivery, to cost $100,000. Soft-sided luggage and ongoing foreign competition were continuing to affect sales, and the EDM would provide opportunities for product diversification.
Though it was not apparent at the time, in retrospect it became obvious that this year was the beginning of the end for Excelsior Hardware Company. A small, unassuming enterprise, Excelsior had progressed from virtually a one-man operation in 1897, to a quietly thriving business, steadily enlarging operations and increasing sales. Wages were increased, benefits were given, an exceptionally fine insurance and pension plan were adopted. Earl's widow, in her letter to the company following his death, remarked:
“One of his foremost wishes was to always have Excelsior exist for the benefit and well-being of all its people . . . We firmly believe that in this turbulent world of ours, our future hope rests in our church, our home and our work.”
This had been Excelsior's philosophy from the beginning, not always to the company's financial advantage. Before many more years the hope, the company, the jobs of everyone involved, would all be lost.
The year 1980 began with an investment of one and a quarter million dollars in the pension fund. Wages were increased 9%, toolmakers got 10%. A pledge of $1500 was made to the YMCA Capital Fund and the annual profit sharing and dividend were voted. The next year a second one and one quarter million dollars was invested in the pension fund. The new EDM and engine lathe were working well and improvements were made in equipment and management practices throughout the plant.
The union contract negotiated for the tool room included five weeks vacation for 30 years and the company was declared to be in sound financial condition by Robert Kahan, auditor. A profit share of approximately two weeks pay was passed. Lynwood Mix, Earl's younger son, was elected a director. This year an 8% raise was given—again 10% for the tool room, a second EDM was purchased, and $10,000 was pledged to the Stamford Hospital Building Fund.
In 1983 prices were increased 8% and wages raised 6%. The house at 711 Pacific street, which had been a drain on company finances for years, was finally about to be demolished. The elderly couple who lived there having died, the remaining family members were served a court ordered eviction notice to vacate by August 1983.
In November Mr. Connolly was named administrator of the pension plan, in which capacity he had already begun serving. In January 1984 Connolly and Robert B. Kahan were named Trustees of the plan.
A contractual agreement was approved in 1985 between Robert G. Thompson and the company, covering operation of a third EDM at Thompson's home, 153 Holmes Avenue, Darien. Offers to buy the company were being received and considered. Ill-advised and inaccurate information was given to the media by a company officer and it was agreed by the directors that further press releases would be made by the company president only.
In 1986, January, president Connolly retired and by a Special Directors Meeting on January 31, Robert G. Thompson, a 21-year employee, was elected president. The statement is simple, the portent, ominous.
It was noted in the corporate records that, when Connolly took office in November 1978, there was $185,000 in cash and $18,000 in securities. At the time of his retirement, cash was $473,000 and securities $400,000. These figures do not include the pension plan.
EDM use continued to increase and plans were made to pursue business in contract stamping and tool making. Directors as of February 24 were Carol Mix, John Mix, Lynwood Mix, Ralph T. Mix, John B. Humphries, Robert Kahan and Robert G. Thompson.
Robert Kahan's accounting of the pension trust showed a total investment of $1,645,000.
Thompson began his career at Excelsior as an apprentice toolmaker. He advanced from journeyman to tool room foreman. He was intelligent, talented, ambitious, personable, and at the time of his election as president, eager to prove himself. He began his sinecure as president by renovating the company offices, installing computers and a new telephone system and expressing his intentions to update the factory itself.
In 1988 the stockholders dissolved the corporation and the company was transferred to Thompson. No money changed hands. This transfer included all assets and liabilities, with the exception of the real estate, which continued to be held by the stockholders of record as of that date. Thompson was entrusted with the business on the understanding that he would continue operations, making improvements and alterations where necessary, and continuing to provide employment thereby, particularly for those employees who had been with the company for a working lifetime. Many of these people had been working alongside succeeding generations of their own and other families, often a son following a father in a particular position.
Thompson organized his own company called "Excelsior Enterprises," doing business as Excelsior Hardware. William Bouton, Jr. was his vice president, and among the directors were Donald Bouton, Robert Middlebrook (company comptroller), Richard Mix, Joseph Tedesco, and Emmanuel Chalikis. John S. Mix and William Bouton, Jr. continued as Trustees of the Excelsior Hardware Company Defined Benefits Pension Plan, a separate entity, not part of Excelsior Enterprises.
Note: Beginning at this point, material is copied from a document prepared for use in the subsequent court proceedings.
I. Forged Pension Plan Checks
1. Mr. John S. Mix and Mr. William Bouton are the Trustees of the Excelsior Hardware Company Defined Benefits Pension Plan (hereinafter "Pension Plan" ) and, as such are (and at all times have been) the only authorized signatories for the Pension Plan checking accounts and Certificates of Deposit.
2. In July, 1989, John S. Mix underwent a serious back operation. Just prior to the operation, Mr. Robert G. Thompson, president of Excelsior Hardware Company (hereinafter "the Company" ) took physical possession of the Pension Plan checking account and certain other records of the Pension Plan by removing the check book and other records from Mr. Mix's locked file, However, at no time was Mr. Thompson ever authorized to execute documents, sign checks or in any other way act on behalf of the Pension Plan.
3. On or about July 5, 1989, unbeknownst to Mr. Mix or Mr. Bouton and without their permission or authorization, Mr. Thompson issued Pension Plan check in the amount of $120,000.00. Said check was made payable to Excelsior Hardware and Mr. Thompson forged Mr. Mix's signature.
4. On or about August 2, 1989, Mr. Thompson issued a second check against the Pension Plan account at CNB, again by forging Mr. Mix's signature. This time the forged check was in the amount of $600,000.00 and was again made payable to Excelsior Hardware Company.
5. On or about September 13, 1989, Mr. Thompson forged Mr. Mix's signature on a third Pension Plan check made payable to the Company. This time the check was in the amount of $30,000.00, and the check number was 1015.
6. These forged checks went undetected for over six months as a result of Mr. Mix's need for a second back operation in 1989, and Mr. Thompson's unauthorized retention of the Pension Plan accounts.
7. In early 1990, Mr. Mix learned of the missing Pension Plan books and records, and requested return of them from Mr. Thompson. After numerous delays by Mr. Thompson, Mr. Mix obtained some of the pertinent documents and learned of the $30,000.00 check drawn on the Pension Plan account. When confronted with this matter, Mr. Thompson assured Mr. Mix that the funds were used for proper Pension Plan purposes and that all documents would be turned back to Mr. Mix promptly. When the books were finally returned to Mr. Mix, Mr. Mix immediately contacted the bank to request appropriate copies and also contacted an attorney to investigate and pursue the matter further.
8. A meeting concerning this matter and a second matter concerning the distribution of funds to shareholders of the Company (see discussion of item 11 below) was promptly scheduled and held on March 26, 1990. Attendees at this meeting were:
- Robert G. Thompson (President of Excelsior Hardware) James F. Simon (Mr. Thompson's attorney)
- John S. Mix (Pension Plan Trustee and shareholder of Excelsior Hardware); Dorothy H. Mix (Mrs. John S. Mix)
- Ralph Mix (brother of Mr. John S. Mix and a significant shareholder in the stock of Excelsior Hardware)
- Richard A. Mix (son of Mr. Ralph Mix) and
- the attorney representing the pension plan of Mr. & Mrs. Ralph Mix and Mr. and Mrs. John Mix
9. At the March 26, 1990 meeting Mr. Thompson stated that he had indeed forged the signature of Mr. Mix on the Pension Plan checks, but that these funds were available and would be transferred back to the custody and control of Messrs. Mix and Bouton immediately. In addition, a complete account of all Pension Plan transactions was to be provided to Messrs. Mix and Bouton on or before April 3, 1990 by Mr. Robert Kahan, of Kahan, Steiger & Co., accountants for Excelsior Enterprises. The results of this meeting were documented in a letter from the representing attorney to Attorney Simon dated March 27, 1990.
10. Within a day or two after the March 26, 1990 meeting, Mr. Thompson informed Mr. Mix and the representing attorney that transfer of the funds back to the Pension Plan trustees prior to April 9, 1990 would require the imposition of an early withdrawal penalty and therefore, Mr. Thompson suggested waiting until that date to transfer the funds. This was agreed to under the conditions that (a) Attorney Simon verify the existence of the funds at the account and, (b) Attorney Simon's signature be added as second signatory to the account, which henceforth would be changed so as to require two signatures for any disbursement of funds from the account. Both of these conditions were allegedly met, as confirmed by letter from Attorney Simon to the representing attorney.
11. On or about April 9, 1990, Mr. Thompson notified Mr. Mix and the representing attorney that it would be several more days before Mr. Thompson would be able to transfer the funds back to the Pension Plan. Ostensibly, Mr. Thompson was in the process of obtaining significant financing for the Company which he said would be jeopardized by an immediate withdrawal of the funds. At this point, the representing attorney, having personally attempted to verify the existence of the funds without success, again questioned Thompson and Simon and requested further assurances. At a second face to face meeting attended by Robert Thompson, Attorney Simon, Mr. and Mrs. John Mix and the representing attorney, Thompson agreed to the following:
||Withdrawal slips would be executed by both Simon and Thompson, so that all funds could be transferred to the Trustees by no later than April 23, 1990.
||Further assurances were requested and received from Thompson and Simon that the funds were in existence.
||Thompson offered to pledge his stock (55%) in Excelsior Enterprises Trust as security for the transfer of the funds by April 23, 1990. These shares were subsequently placed into escrow with Attorney Simon.
||Thompson also guaranteed the transfer of the Pension funds by requesting and obtaining the pledge of Lynwood Mix and Mary Mix of their funds (approximately $700,000.00) in a CNB account as security.
All of the foregoing were provided by Thompson and/or Simon and the funds were to be transferred on April 21, 1990.
12. On April 23, 1990, Thompson requested a three day delay on the transfer of the funds, stating that the refinance had been completed, but that there was a three day rescission period required by the bank. This three day extension was granted when Attorney Simon verified that the bank had in fact required the statutory waiting period.
13. On April 26,1990 Mr. Thompson stated that the refinancing had gone through, and although there was a $277,895.59 lien on the pension funds at CBT, he had issued a check to CBT to clear said lien. The representing attorney then requested a copy of the signed receipt from the bank that the loan had been paid off. It was subsequently learned that:
||Thompson had never submitted the check to CBT.
||The signed receipt was not on official CBT letterhead but, rather, was on fake letterhead constructed by Thompson.
||The signature on the CBT receipt was that of an employee who had been discharged two weeks earlier and that the signature of the CBT official was a forgery.
14. On May 4, 1990 the representing attorney notified CNB of the forgeries and forged check affidavits were completed by John S. Mix on May 7, 1990.
15. Subsequent to May 7, 1990, the following actions were taken:
|| The matter was reported to the Stamford Police and the State's Attorney's office.
||The State Banking Department was notified.
|| Notice was given to General American, the insurance company for the Pension Plan, and to the Corporate Benefit Guaranty Corporation.
|| Notice was given to the U.S. Attorney's office, and the Pension and Welfare Benefits Administration of the US Department of Labor.
|| Civil litigation against Mr. Thompson, CNB and others, to recover all pension funds was commenced shortly.
II. Misuse of Shareholder Funds
1. In February, 1988 the Excelsior Hardware Company sold certain real property known as 39 Woodland Avenue, Stamford, Connecticut, to Victor B. DeYulio (B&S Carting Company), received $1,000,000.00 in cash and took back a promissory note and mortgage for $2,000,000.00. A portion of the cash was used to pay taxes and the remainder was distributed to the existing shareholders of the Excelsior Hardware Company. The note was assigned to Robert G. Thompson, Trustee in Liquidation for the Excelsior Hardware Company. The note as written was payable in five annual installments of $400,000 each. Mr. Thompson, as Trustee, was to collect the moneys due and distribute them to the existing shareholders in accordance with their percentage of ownership of the Excelsior Hardware Company.
2. In February, 1989, the first payment of $400,000 was made. In May, 1989 a decision was made by the shareholders to accept $1,300,000 from Mr. DeYulio in full settlement of the entire indebtedness.
3. On February 27, 1990 a Treasurer's check drawn on the Putnam Trust Company for $1.3 million was made payable to the B&S Carting Company, Inc. and endorsed over to Robert G. Thompson, Trustee in Liquidation. These funds were to be distributed by Mr. Thompson to the shareholders of the Excelsior Hardware Company.
4. On March 16, 1990, Mr. Thompson issued certified checks to Mr. Ralph Mix or Mrs. Dora Mix, two of the shareholders of the Excelsior Hardware Company. These checks were certified on March 19,1990. However, Mr. Thompson has admitted that at no time, either on March 16,1990, when the checks were written, or any time thereafter, were there sufficient funds in the account to cover any of these checks. Thus, the question of how Mr. Thompson was able to obtain the certifications was unanswered and no answer was ever forthcoming from the bank.
5. On March 26, 1990, Mr. Thompson, Attorney Simon, Ralph Mix, John S. Mix, Dorothy Mix, Richard Mix and the representing attorney met concerning the distribution of the funds. Mr. Thompson indicated that all of the funds were now in a CNB account in the name of Excelsior Hardware. When Mr. Thompson stated that there would be a penalty for early withdrawal, it was agreed (a) that Attorney Simon would be added as a second signatory on the account, (b) that two signatures would be required before any funds were disbursed (c) that the funds would be transferred and (d) that a full accounting would be provided by CPA Robert Kahan. In addition, Attorney Simon confirmed the existence of the funds in the account.
6. On April 26, 1990, Mr. Thompson issued checks to the representing attorney, as Trustee. All of these checks were returned for insufficient funds.
7. When a demand was made on CNB to transfer the funds to the representing attorney, as Trustee, CNB notified the representing attorney that CNB had granted loans to Mr. Thompson and/or Excelsior Hardware using the funds as collateral for said loans. Thus, CNB refused to release any funds claiming a security interest in the account.
Excelsior declared bankruptcy under Chapter 11 in July, 1990. For some time an attempt to continue operations was continued under the leadership of Joseph Tedesco and others. Ultimately the company was sold to a German company who planned to consolidate operations with Presto Lock in New Jersey, which they had also purchased and to then transfer all operations to Mexico. This attempt was, likewise, unsuccessful and in January, 1994, Excelsior laid off its last two employees and closed it doors for the last time.
In New Haven Federal Court in April, 1992, Robert G. Thompson was sentenced to serve three years for the theft of $600,000.00 from the Pension Plan. He was released in late 1994 and at this time (September 2002) continues to live in Darien, CT and is employed by a Stamford company.
The history of the Excelsior Hardware Company closes in 1994. Always, there is more to the story than what is detailed in the bare facts and, in this case, there is much more.
In January of 1990 a bomb scare emptied the factory, but no bomb was found. In March of that year, there was a second bomb threat. The day after the second threat a small fire in a second floor storage room was classified as arson by the Stamford Fire Marshall's office. On examination, it was found that above the storage room there were 22 boxes of brown paper lunch bags filled with Connecticut lottery tickets—several kinds, all denominations. When loaded in a truck for final disposal, these tickets weighed over 480 pounds (about 800 tickets to the pound), representing hundreds of thousands of dollars. The reason for Thompson's mishandling of company money was thus revealed as a gambling addiction.
When legal action was taken and reported in the Sunday, July 1, 1990 Stamford Advocate, company employees were very upset and frightened. They saw their pension funds lost and their retirement threatened. Actually, the Pension Plan was insured and payments became the responsibility of the Pension Benefit Guaranty Corporation, roughly the equivalent of the FDIC, and all pensions were intact.
On July 18, 1990 further disaster became known. A voluntary Chapter 11 bankruptcy filing listed company debts of six million dollars, assets of 1.5 million. Over one hundred creditors were listed, including stockholders, utilities, suppliers and employees. Paycheck withdrawals for union dues, medical insurance, and United Way contributions had been made, but never paid. Two medical plans had lapsed since May, 1989, with no notice to employees, leaving thousands of dollars in medical expenses the responsibility of the patients. There was suddenly no work—and no paycheck. Of the six million loss, the Mix family personally lost some four million. The FBI, IRS, the US Department of Labor, the US Attorney, the Economics Crime Unit of the Connecticut Chief States Attorney's office, all were conducting investigations.
Thompson was charged with violating the federal racketeering Act (RICO) and the Employee Retirement Income Act, in a suit brought by Pension Plan Trustees, John S. Mix and William Bouton, Jr.
In September stockholders filed a suit against Thompson alleging he kept most of the three million dollars received on the sale of the company real estate. One member of the Mix family, believing he was furthering the well-being of what had been his family's business, turned over his share of the real estate proceeds for investment in Thompson's company. He then added the proceeds of his father's and brother's estates, ultimately losing some two million dollars.
Saddest of all was the death of the wife of one of the employees, killed by her husband in a failed murder-suicide attempt. The husband, in poor health, worried over their future, viewed his expected retirement as stolen from him. In his distraught state, he saw no other way to take care of his wife and himself. He lived out his few remaining years in a state psychiatric hospital.
There is also documented evidence of Thompson's mishandling of one employee's money, involving a $17,000 CD. Only after threats by other employees did Thompson repay the $10,000.00 he had "borrowed" from said employee, having intimidated him into cashing in the CD.
Dorothy H. Mix
Stamford Historical Society,
Stamford Advocate: various issues of 1990 and 1992
Elisha Mix, Jr.: Memoirs
John S. Mix: Personal Recollections
John S. Mix: Deposition
List of Records
||Ledgers, May 28, 1908 - September 30, 1909
Elisha Mix Account Book, August 1, 1897 - January 1899
Elisha Mix Pocket Diary, 1916
||Corporate Minutes, June 27, 1910 - November 23, 1954
||Corporate Minutes, December 24, 1940 - November 23, 1954
||Corporate Minutes, December 21, 1954 - December 30, 1969
||Corporate Minutes, January 26, 1970 - November 3, 1987
Report of Corporate Bankruptcy.
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