While the majority of my recollections are pleasant, there are exceptions. The bankruptcy in December of 1965 of the Jackson Furniture Company was one. Founded by my grandfather in 1889, I became President upon the death of my father. It was I who saw the company close.
A night six days before Christmas in 1965 was one of my most difficult. My daughter, Lindsay, was making her debut. In white tie and tails, I was to introduce her. That evening's newspaper carried a front page story of the bankruptcy. Under the circumstances, I'd have much preferred being anywhere else.
Another father was part of the group. I had nodded briefly to Rudolph Peterson, President of the Bank of America. His bank played a primary role in causing my downfall.
Our basic source of working capital was borrowing against accounts receivable. Over the years, this had been a satisfactory arrangement. In hindsight, we should have also had long-term financing.
The Bank of America abruptly reduced these loans. To compensate for this squeeze on working capital, I sold our buildings with the bank's assurance they'd not further reduce our financing. They agreed; but as soon as the funds from the property sales were on hand, they changed their minds. Now, we were in the same capital bind but without the value of our real estate. As our one friend at the bank confided, they're going to put you out of business. He was correct.
Our threat of a lawsuit to adjudicate what we considered a breach of faith was met by the comment, go ahead and sue. You're broke. How far do you think you can get?
My company stock was now worthless as were minority holdings of our employees. While there was no legal requirement, I personally purchased these shares at face value. I didn't want to see old friends hurt.
The Bank of Tokyo was our other bank. Details of our letters of
credit and importing costs for the
With the Jackson Furniture Company now out of business, I activated my personal corporation - Pacifica Designs - to hopefully, develop a new business venture.
My problems - would the Bank of Tokyo transfer the
With apprehension, I carried documents prepared by my attorney
and accountant to
"But what about all these papers we have to review, and what is your decision on transferring funds to Pacifica Designs?" I asked.
He smiled and answered, "It's all been taken care of. You
have no problems and enjoy your visit to
I left the bank pleased that half of my Japanese assignment had been completed satisfactorily. As I walked the short distance to the Takashimaya Department Store, I wondered if Tetsutaro Iida would be this accommodating.
We met in his osetsushtsu and discussed
unrelated subjects for ten or fifteen minutes, as is the Japanese custom. Then,
probably sensing my concern, he said, "I'm so sorry to hear of your
I was back in business.
The bankruptcy brought about a most pleasant surprise. I'd
written a letter to the