<Begin Segment 13>

HM: But, well, I decided that, that this whole experience about, on these guys getting into such great frenetic exercises would not be great for me. And so I decided to quit Convair. And I worked for X-Onics. And we got into problem situations like General Atomics, which was another division of General Dynamics, which is atomic energy outfit that was located close to the Astronautics division of General Dynamics. Anyway, they wanted some cleaning equipment to get all the radioactive crap that was on some of the equipment. So I had done some work in ultrasonics, so I knew a little bit about it. And so we got some designs together, and we made couple of prototypes. And we started making ultrasonic cleaners specifically for the atomic energy cleansing requirement. And so we were doing a number of things. And then the more we got into ultrasonics, the more people wanted these different things. And so it came to a point where they said, "Well, we can't keep up with the demand here. We got to get some other production capability." So they said, "Well, they're making ultrasonic stuff in Japan. So Henry, why don't you go to Japan? You've been there before." [Laughs] So of course, been there for four days. But anyway, he said, "Why don't you go over there and get together with the ultrasonic company? And let's have them make the equipment over there." So I was, I was kind of apprehensive about the whole thing. And he said, "Well, we'll send your whole family over there." Well, that was a convincing point. So anyway, I go to Tokyo, and I headed a program for this electronics show. And I started look -- scouting for ultrasonic companies.

TI: And when you're in Japan, did you just -- you used your Japanese.

HM: Yeah, yeah. My broken Japanese. Everything that got me in trouble. Well, as it turned out, there were three -- there were five companies at that electronics show that had ultrasonic gear. And three of them were quite impressive. And one was very impressive. They were doing things like plastic welding. They were doing things like making plastic cans or equivalent of cans, and they were using motor oil inside of them, and then sealing around the periphery with, ultrasonics. And it was leakproof. Ultrasonically welded plastic cans. And they had a lot of stuff there. And so this was the Cho-Onpa Company. So I arranged to the meet the president. And, and I -- when I met with him I asked him if he would be interested in a technical tie-up. But we guys in the San Diego thought we knew it all about ultrasonics, and these guys would just make the products for us. Well, it just happened it was the other way around. But --

TI: So the Japanese technology was, surpassed what you, what your --

HM: Yeah. We had a machine tool, ultrasonic machine tool, that we were contemplating using for dicing up the semiconductors. At that time they had germanium semiconductors, and they were -- it was a chip form. And they were depositing on the germanium at that time. But in order to dice it up they were using different techniques like slicing with a abrasive blade, and other ones would be punching holes with a whole bunch of metal tubes. And there was high demand for that equipment. And also the machining for things like dies, very small dies, that were either diamond for the die format or some very hard metallic item.

And anyway, these guys were making the diamond die for drawing the ultrathin wire for Western Electric. I didn't know that at that time. And these guys in Japan were doing it. So anyway, when I went to this company to talk to the president, he says, "Okay, this is the kind of stuff we're doing." And he started showing me this different kind of stuff. And he says, well -- and I look at this piece of equipment, looked like a 1929 piece of gear, wrinkle finish, industrial design was zilch. And he was showing me these diamond dies. And I thought to myself, man, they could make some really fine wire with this diamond die system. So I asked him who they made it for, and he wouldn't tell me. He says, "Well, we can't tell you that." "Is it American?" He says, "Yeah." Well, anyway I found out from another guy in the plant later on that it was for Western Electric.

So anyway, I said, "Hey these guys are saying that they can drill a hole in this kind of material at this rate." And I (telephoned this performance data) thing to San Diego. And Henry -- the return was, "Henry, you must have put the decimal point in the wrong place."

TI: In the wrong place.

HM: Yeah. I said, "No, this, this is absolute." So I said, "Are we going to make a 16-millimeter film of this operation real-time, and it will show you exactly what's it doing." So we did that. We sent them the film. He says, "If they're doing what you saying they're doing, and if it's the material you claim it is, then they're doing it three times faster than we are. They know more than we do." Then the whole ballgame changed. Then we had to get a technical tie-up, not a production tie-up. So we started doing the negotiation. And then when we finished the negotiations, that's when they had that board meeting, and Nomura comes up to me and asked me if I knew a George Kazuo (Miyatake). But at that point he was a hundred percent supportive of everything I was doing. But as it turned out, the company in San Diego, we got -- the news started coming out that these guys are doing all these things. Of course, it was based on the Japanese technology, but nobody knew that. And they made this public stock offering, and stuff started to go up. And they got into news too much. And then during the stockholders meeting the La Jolla bankers decided to swing their votes to guys of another company. And so we got merged in, without any knowledge of the guys.

TI: Well, were they the original six to fifteen employees? Were you -- did you all have equity stakes?

HM: Yeah, yeah.

TI: So how did you make out? Did you make out pretty well?

HM: Well, the first go-around wasn't bad. We got absorbed by a company that was local company. And then --

TI: And so you're, you got stock in that company?

HM: Yeah, yeah.

TI: You just sort of...

HM: So we had options, and we were in pretty good shape at that point. Next level, the thing that happened next was that the -- there was an article in the Los Angeles paper about, it was this upstart company in San Diego doing this kind of stuff. And Interstate Electronics was looking for exactly the kind of company that we represented. So on the next go-around they took us over. And they had no requirement to observe the stock option rights that we had from the previous company. They, they were overwhelming in their ability to vote the stock of the company we got absorbed from, absorbed into. And consequently all the options we had just went down to zilch.

TI: Well, before that happened, I mean, was it similar to like the startups now when companies, and...

HM: Yeah.

TI: ...so you were, you were --

HM: Pretty good shape, yeah. I thought, man --

TI: To the point where you could retire?

HM: Yeah.

TI: To that level?

HM: It was pretty close, yeah.

TI: Okay.

HM: Yeah. But the second time, the second merger...

TI: Just wiped it out.

HM: Kept it -- wiped it out.

TI: Well, did it wipe out the bankers too, the La Jolla bankers?

HM: No, no. They played the game according to benefiting them. So --

TI: So they made out?

HM: Yeah. Because they had preferred stock, and that had a different, different kind of relationship.

TI: So you and your other co-workers got screwed?

HM: We got zapped, yeah. [Laughs]

TI: Well, but then yet you held a lot of the technical knowledge and the connections.

HM: Well.

TI: So that that -- they had to be careful.

HM: Unfortunately, they had the, a new general manager come into play because we became Interstate of Electronics, now. So he says, "Hell, I've been to Japan, and prices are low there. You're getting paid too much. So we're going to cut your salary." And they did. And here I had a six-man group there, and they're cutting my salary and cutting my budget, and I had to leave, let some of these guys go. So I'm starting to work two shifts now. I have to do export inspection stuff and all this stuff, besides monitoring what the design functions were and --

TI: Well, out of curiosity, why did you guys stand for this? I mean, you guys --

HM: Well.

TI: I mean, at some point -- yeah, it doesn't make sense to me.

HM: Yeah, it didn't make sense to me either. So I said -- by that time I, I was working so much that I started getting ulcers. And I didn't realize it at that time. But anyway, I was, exiting blood. I just started at that point. And I decided, well, I'm not going to take this crap. So I wrote a letter of resignation. And I said, "You're required to transport all my items back to the United States." And that guy wouldn't recognize it. He says, "You went on your own free will." But well, I was a company officer at that time. And so everybody that I was working with were supporting me. But now we've been absorbed as two generations level, and they couldn't care less. So I said, "I'm quittin'. Shipment -- this is the last shipment I'm going to make, be responsible for that, after that, phooey." Then I went on vacation. And then I collapsed at a ryokan. I lost so much blood by that time that I just, knocked over. And they transported me to the Tokyo hospital. And I was there for about two weeks. And the doctor says, "You've got to get off of this kind of workload that you have. Either that or you've got about three years to live." I decided, well, I'll go back. And that's when I came back to the States. But had we had the only the one merger, we would've been in great shape.

<End Segment 13> - Copyright © 1999 Densho. All Rights Reserved.