CONTINENTAL GIN COMPANY The First Twenty-Six Years

1899-1925

In the summer of 1899 W. T. Northington, President of Northington-Munger-Pratt Company of Birmingham, approached A. W. Smith, President of Smith Sons Gin & Machine Company of Avondale, with the suggestion that a merger of several large gin companies might be advisable and profitable. Obviously, the example of industrious effort would pool the knowledge of the engineers and assure large and efficient production at lower cost.

Mr. Northington also approached C. R. Winship of the Winship Machine Company, Atlanta, Georgia; S. I. Munger of the Munger Improved Cotton Machine Manufacturing Company, Dallas, Texas; and Daniel Pratt of the Daniel Pratt Gin Company, Prattville, Alabama. R. S. Munger was somewhat averse to a merger. However, at a meeting held in New York on October 20, 1899, at which time these executives were present, an agreement to perfect a merger of these companies into one company was entered into, the company to be known as the Continental Gin Company.

On November 17, 1899, the Old Colony Trust Company of Boston, Massachusetts, was selected to prepare the incorporation papers and to act as trustee in handling the properties which were to be deeded to the new Continental Gin Company.

The charter authorized the issuance of three million dollars in capital stock with two million dollars to be paid in. R. S. Munger was to be allowed for his patents eight and one-third per cent of the stock to be issued and the remainder to be issued to each company as their average profit showed for the two years 1897 and 1898. It was also the responsibility of the Old Colony Trust Company to have the audits made of the companies to determine the earnings for the two years. Each company was to transfer all of its assets of every character including personal and real property, and patents, with the exception of cash, notes receivable and bonds.

On February 19, 1900, the auditors reported their findings and fixed the amount of the stock to be issued to each company. Between the date of the contract with the Old Colony Trust Company and the completion of the auditors' report, the Eagle Cotton Gin Company of Bridgewater, Massachusetts, which enjoyed a very large export business, requested to join the merger. This request was granted and this plant was included in the auditors' report.

On March 28, 1900, a called meeting of the stockholders was held at the office of Northington-Munger-Pratt Company in Birmingham, and by-laws were adopted and two directors were elected from each company as follows:

W. T. Northington    S. I. Munger   R. S. Munger    Ennis Munger   A. W. Smith    S. P. Gates   D. T. Smith    F. C. Gammons   C. R. Winship    Daniel Pratt   George Winship    J. B. Bell

At the directors meeting which followed, the following officers were elected:

W. 'T. Northington, President.    S. I. Munger, Vice President.   R. S. Munger, Vice President in charge of Manufacturing.    Daniel Pratt, Vice President.   C. R. Winship, Vice President.    A. W. Smith, Vice President and Treasurer. N. W. Proctor, Secretary.

The Executive Committee consisted of W. T. Northington, A. W. Smith, Daniel Pratt, C. R. Winship and R. S. Munger. Factory superintendents in the participating companies were retained as follows:

J. C. Burns, Prattville Factory.    S. Johanson, Birmingham Factory.    D. T. Smith, Avondale Factory.    E. V. Garreaux, Atlanta Factory.    C. H. Elliott, Dallas Factory.   F. C. Gammons, Bridgewater Factory.

 The stockholders also authorized the issuance of $750,000 in bonds, secured by the properties of the companies; these bonds were not to be sold but to be used as collateral in borrowing funds to operate the new organization. Continental Gin Company had no working capital since each of the companies transferred only their physical properties and inventories. These inventories also had to be adjusted to the period between January 1899 and January 1900, depending solely upon whether they were larger or smaller. The individual companies were paid for any excess inventory and the Continental Gin Company was paid for any decreased inventory.

At this time the usual terms for selling gin machinery were practically without cash: one-half the first fall and one-half the next. Often it required three years to collect. This, of course, required a large amount of operating capital. The Treasurer was authorized to borrow from banks in Birmingham, Boston, New York, Atlanta and Dallas. During the summer of 1900 there was rather a heavy financial burden on the Company, necessitating all the factories to reduce their payroll. In addition to borrowing from the banks, individual stockholders made substantial loans to the Company.

During the first year the sales were left largely to each factory, but in 1901 Mr. Northington directed the sales organization for the territory east of the Mississippi River, and S. I. Munger directed the sales west of the Mississippi River. The Eastern sales orders were accepted by the Birmingham office and the Western sales by the Dallas office, these two offices distributing the sales to the factories.

In July 1901 the Executive Committee requested R. S. Munger and a committee to look into the advisability of simplifying the manufacture of the different gin machines. Each factory had continued to manufacture its full line of machinery as previously made. The committee decided that only two types of elevators should be made: one type called a pneumatic which used chutes over the feeders and the other type

the Munger System which used a vacuum box and belt distributor to put cotton into the feeders. From among several pneumatic types being manufactured, it was decided that the one manufactured by the Daniel Pratt Gin Company would be the standard for pneumatic elevators, and the one manufactured by Northington-Munger-Pratt Company would be the standard for the belt distributor type of elevator. The condenser and lint flue was to be of the type produced by the Northington-Munger-Pratt Company and the feeder was to be of the type produced by the Smith Sons Gin k Machine Company. Each company was permitted to continue the manufacture of gins as they had previously done.

In December 1900 the Company purchased the Hall Self Feeder Company, of Sing Sing, New York, including their patents and inventories. This operation was liquidated promptly and the inventories were disposed of.

The individual companies merging into Continental Gin Company were all family owned. Competition among the companies had been very keen at times and there existed personal feelings. The merits of the merger had to be proven, consequently the first year was one of many adjustments.

There were no changes on the Board of Directors or Officers for the year 1901. At the February 1901 meeting of the Executive Committee, R. S. Munger resigned as vice president. His resignation was accepted and Mr. Northington, as president, was authorized to assume the responsibility for the manufacturing during the remainder of the year. The profits for 1901 were approximately 25% less than the combined profits of the individual companies prior to the merger.

In November 1901 determined to effect plans for more efficiency within the Company by having fewer officers, a committee was appointed to suggest a change in the organization. Recommendations were made that officers be as follows: president, vice president, treasurer, secretary, a general purchasing agent to be located in Birmingham, a general superintendent and a superintendent for each factory. The factory superintendents were to be responsible to the general superintendent. The factory officers and cashiers were to be responsible to the treasurer.

At the general meeting of the stockholders in January 1902 there was no change made in the directors and in line with the recommendations made by the committee, the following officers were elected: W. T. Northington, President, S. 1. Munger, Vice President, A. W. Smith, Treasurer, N. W. Proctor, Secretary, D. T. Smith, General Superintendent, and A. L. Smith, General Purchasing Agent. The superintendents of the factories remained unchanged.

The by-laws of the Company called for a directors meeting the first part of February each year to receive reports from the various officials. The following day a stockholders meeting was held at which time the directors and officers were elected for that year. This annual meeting required the presence of the directors in the city for two days, and R. S. Munger entertained the directors and officers in his home at Arlington Place, Birmingham, at dinner. This became an annual custom with Mr. Munger.

The Company maintained two demonstration outfits, one at Dallas and the other at Birmingham. This was to enable prospective customers to see the operation of the machinery. In 1902 the Dallas office reported they needed a better demonstration outfit, and they were authorized to construct one at a cost of approximately $5,000.00.

At the January 1902 Executive Committee meeting, an announcement was made of a gift of $10,000.00 by R. S. Munger to be held in trust and the income used for the benefit of factory employees in cases of sickness or death. Mr. Munger was ever mindful of the factory employees. This fund was increased by Continental Gin Company from time to time until the amount reached $100,000.00. Trustees were appointed each year thereafter to handle these funds and the fund is still in existence.

In January 1903 there was no change made in the directors. At this meeting Mr. Northington resigned as president and S. 1. Munger of Dallas, Texas, was elected to succeed him; A. W. Smith was made vice president and treasurer. These were the only changes made in the officers except for J. W. Waddell, who was made superintendent at Memphis and W. M. Hurt, who was made district sales manager at Memphis.

The first dividend was declared at the January 1903 meeting but it was a very small one.

The general sales offices located at the Birmingham factory were inadequate, therefore a lease was made for the sixth floor of the Title Guarantee Loan & Trust Company building. After June 1, 1903, the entire general offices were moved to this new location.

In September 1903 D. H. Smith was made general purchasing agent, and at the same time A. L. Smith was transferred to the sales department and made sales manager of the Birmingham office.

The Liddell Company of Charlotte, North Carolina had been the Company agents for North Carolina and South Carolina but their contract for 1904 was not renewed. At this time a sales office and repair storage depot were opened in Charlotte for handling Virginia and North Carolina and South Carolina business, with S. R. Jacobs in charge. Mr. Jacobs remained only one year and W. M. Hurt was transferred to the Charlotte sales office to succeed him. During 1905, T. R. Collett was made district sales manager at Memphis; E. D. Lupo was made district sales manager at Atlanta; and A. L. Smith was made district sales manager at Birmingham.

During the year of 1905 a new dam was built at the Prattville factory.

When Continental Gin Company was organized, it was offered several patents of a small company in Dallas, including their plant, for the sum of $50,000.00. The majority of the directors wanted to purchase this property but since they could not agree unanimously, the matter was dropped. Approximately two years later Continental Gin Company began the manufacture of an upright Class C Feeder. In the meantime the patents of the small company in Dallas were acquired by other parties and in 1907 they brought suit for infringement on this upright cleaner feeder. Unfortunately Continental Gin Company lost the suit and made a settlement in the sum of $100,000.00 for the machines already manufactured and for the privilege of continuing to manufacture the feeder.

In 1908 a better and larger demonstration outfit was built at Birmingham, replacing the old one. It was needed in the promotion of sales.

The year 1910 brought quite a number of changes in minor officers of the Company. At the annual meeting R. C. Munger was elected as a director to succeed Ennis Munger, who had died the year before. At this same time Mr. Munger was made superintendent of the Birmingham factory. S. Johanson was transferred to the Atlanta factory, R. E. Wilson was made superintendent at the Dallas factory, and A. L. Smith was made sales manager in charge of all domestic sales. Mr. Smith was also in charge of export, with authority to fix prices and terms, but always subject to the approval of the president. T. R. Collett was transferred from Memphis to Dallas and H. W. Brooks was elected to succeed him as district sales manager at Memphis.

At this annual meeting a resolution was passed extending sympathy to the family of F. E. Smith, Sr. who died on March 23, 1909. Mr. Smith was a pioneer in the ginning industry and one of the original organizers of Smith Sons Gin  Machine Company.

In the fall of 1910 E. D. Lupo, District Sales Manager, Atlanta, resigned because of ill health and was replaced by J. F. Humphrey.

The January 1911 stockholders meeting brought no changes in the directors or officers. A recommendation by the directors was presented for payment of a fifty percent stock dividend. The authorized capitalization was three million dollars representing 30,000 shares at $100.00 per share, par value. Only two million dollars or 20,000 shares had been issued. The treasurer reported a surplus of $2,100,000.00 and the recommendation was approved.

In 1911 there was a great need for additional warehouse space at the Prattville factory. The only property available was the adjoining Methodist Church, though a street separated the two. The Methodist Church property was acquired and assistance was given the Methodists in building a new church at a new location. The city relocated the bridge across Autauga Creek and closed the street, thereby bringing the two properties together. On this site a four-story warehouse building 60x170 feet was constructed. Because of the seasonal nature of business, the manufacture of machinery in the fall and in January and February was necessary for delivery in June, July and August.

There was an increasing demand for the Pratt and Munger gins over others being made, therefore the manufacture of the Smith gin at Avondale, Winship at Atlanta, and the Eagle at Bridgewater was discontinued for domestic trade. Both Avondale and Atlanta factories began making the Munger gin. The Bridgewater factory continued to make gins for export trade and also manufactured linters (a machine for delinting cottonseed used by the oil mills) , the manufacture of which began about 1902.

Three different sizes of press boxes had been made: two sizes for a 500-pound bale, and one size for a 750-pound bale. The demand for 750-pound bales came from the Mississippi planters who were having to pay a $.50 levy tax. This large size bale reduced their tax payments.

Unless the compresses, which repressed the bale as made at the gin, were very carefully used, these 750-pound bales frequently broke the presses. There was complaint to the New Orleans Cotton Exchange. The Exchange requested the manufacturers of cotton ginning machinery to meet with them and discuss the advisability of making a standard size press box so that all bales would be uniform in size. There were hardly any two cotton gin manufacturers who had the same size press. The result of this meeting was an agreement on the part of the cotton ginning industry to make only one size press box which measured 27"x54"; and the Cotton Exchange agreed that if this were done, they would penalize all bales of cotton weighing more than 600 pounds or less than 400 pounds. The size press box adopted at that time has been in use continuously by the entire cotton ginning industry since.

In 1912 A. L. Smith was made general sales manager, which was only a change in title but not in duties. J. A. Garthright was made superintendent of the Prattville factory succeeding J. C. Burns who was in bad health. Mr. Burns was made advisory superintendent. During the year a new foundry was built at the Dallas, Texas plant.

Each year since 1903 a convention of the salesmen had been held in the fall. In 1913 in addition to district sales managers and salesmen, the district engineers and the factory superintendents attended the meeting. Discussions of the needs of the Sales and Manufacturing Departments took place, and these conventions became so helpful they have never been discontinued.

At the stockholders meeting in January 1914, A. W. Smith, who was then vice president and treasurer, was made treasurer only; R. S. Munger was made vice president; Eugene Munger was made assistant to R. E. Wilson, superintendent

of the Dallas factory; and J. S. McAnulty was made assistant district sales manager at Dallas. There was also created at this time a Traffic Department with W. B. Lewis as manager.

While there was a good brick warehouse at Dallas, the factory buildings were of frame construction, old and badly in need of repair. In the fall of 1913 an appropriation of $250,000.00 was made for a new building and a committee consisting of R. S. Munger, chairman, S. 1. Munger, D. T. Smith and Daniel Pratt, was appointed to supervise its erection. This building was completed the following year. Also several new buildings were constructed at the Birmingham factory in 1914.

War clouds that had been gathering over Europe broke in July 1914. Naturally sales for the year had been practically completed at that time, and this did not affect profits for the year. The Company felt the pressure of the European situation with rising costs, but no change was made in plans for the future.

At the first directors meeting in 1915 announcement was made of the death of S. P. Gates of Bridgewater, Massachusetts, which occurred a few days after the 1914 meeting, the first meeting he had missed since the organization of the Company. W. T. Northington came from Prattville to attend the first directors meeting in 1915. He was ill when he arrived, and died three days later at the residence of his son, Merrill P. Northington, in Birmingham. His death left the second vacancy to be filled by the stockholders. L. R. Munger of Dallas was elected to replace S. P. Gates, and Merrill P. Northington to replace his father.

In 1915 the Company began the manufacture of air blast gins, making both brush and air blast. R. S. Munger was made chairman of the Construction Committee to construct a building to be used for research and experimental purposes.

In 1916 Eugene Munger, assistant superintendent at Dallas, came to Birmingham to take charge of the Machinery Improvement Department, under the supervision of his father, R. S. Munger. S. I. Munger, Jr., replaced him as assistant superintendent at the Dallas factory.

Though war conditions were affecting the profits of the Company, an additional payment of 20% was made to all salaried employees since living costs had begun to increase, the payment to be made in December, January and February of each year.

At the stockholders meeting in 1917 the addition of George Winship, Jr., was made to the Board. He replaced his father who died April 11, 1916. At the same time Eugene Munger became a director. George Winship, Sr., had made a very valuable director and was greatly missed.

On April 6, 1917 the United States declared war on Germany. In June of this year the Continental Gin Company subscribed $100,000.00 for the purchase of Liberty Bonds. ' It also arranged for the employees to subscribe, through the Company, deducting their subscriptions from the payroll. Except for the purchase of bonds, no other war activities took place at the various plants.

About 1901 several Munger Ginners compresses were manufactured. These were made under the patent of R. S. Munger and would compress a bale to approximately 25 or 30 pounds per square inch density. From an economical standpoint this would save about one-third of the freight car space used for handling the crop, if the bales were brought to that density at the gin. The density of the regular press was 10 to 15 pounds per square inch.

The first year or two the railroads gave the ginner the fee that had ordinarily been paid to the compressors, but later they would not pay any fee, and in some cases penalized bales compressed at the gin. As the ginners compress cost several times that of the ordinary press, and the ginner received no remuneration for using it, this immediately stopped the sale of the Munger Ginner's compress. However, during World

War I, there became such a scarcity of freight cars that the government ordered representatives of the gin manufacturers to come to Washington to discuss the advisability of putting in a ginner's compress in every cotton ginning outfit. The war ended very shortly after the conference and the matter was dropped.

There was a very disastrous fire in Atlanta at this time and the Company made a substantial donation to the fire sufferers. In August the Company purchased an additional $40,000.00 in government bonds and in addition made a donation to the Dallas Air Field.

Continental gins, except on huller gins, had always had 10-inch saws and now for the first time, a 12-inch saw plain gin was manufactured.

There was a substantial export business to South America, especially Brazil, and also to Russia. However, beginning with the war years, Continental Gin's Russian agent, J. Block Company in Moscow, due to the very heavy exchange rates because of the war, asked permission to pay invoices in gold rubles into the Bank of Moscow, to be transferred at the conclusion of the war. J. Block Company had been Continental Gin's agents for many years and did a splendid business for the Company, so this was agreed to for the years 1915, 1916 and 1917. Then the Red Revolution came, taking over all the banks, which resulted in the Company's loss of an amount exceeding $213,000.00.

In addition to the above loss, the Company had a large shipment moving into the port of Vladivostock, but due to the Revolution, the Company succeeded in stopping shipment and having it returned to New York. This machinery reached New York and was placed in the Bush Terminals to be disposed of as early as possible. Immediately after the shipment arrived, the government ordered the Bush Terminals cleared for government storage. This was complicated by the Hudson River freezing and tug boats were unable to move barges. The shipment was finally sent to the Bridgewater factory, but it was almost three years before final disposition of this machinery was made.

Because of the war conditions, sales were unusually large and all the factories were put on a sixty-hour basis and a 10% bonus was given to all employees. The Company also purchased $100,000.00 of the Third Issue Liberty Loan Bonds. Again in September $100,000.00 of the Fourth Issue Liberty Loan Bonds was bought.

S. Johanson, Superintendent of the Atlanta factory, resigned in 1919. He was replaced by A. W. Merkel, who had come to the Company from the Alabama Polytechnic Institute at Auburn when he graduated. After returning from the Army with the rank of lieutenant colonel, Mr. Merkel was assigned to the position of assisting the general superintendent. This training prepared him well for the position of factory superintendent.

Sales and profits were very good in 1919 and 1920. The last of the bonds issued by Continental Gin Company in 1900 for working capital were redeemed in the amount of $750,000.00. At the first stockholders meeting in 1920 a report was received from the Old Colony Trust Company, stating they had burned the redeemed bonds.

The president advised that the Company had enjoyed several good years, namely 1917, 1918, 1919 and the indications were that 1920 would be the best of all. He felt steps should be taken to increase the plant buildings and tools in order to reduce costs and to also increase business. A committee was appointed consisting of R. S. Munger, D. T. Smith and Daniel Pratt to secure the services of an engineer to make a survey of the plants and to recommend changes.

After consulting with several engineers, a contract was made with the H. K. Ferguson Company to make a survey and recommendations. After making the survey, it was suggested that the tools and equipment at the plants in Atlanta and Prattville be improved, that the Birmingham and Avondale plants be consolidated, and a new building to replace them be constructed on a site consisting of at least thirty-two acres. Through the assistance of several real estate men, three locations were considered: one at North Birmingham, which was owned by R. S. Munger, consisting of 65 acres; a site owned by the U. S. Fleet Corporation, consisting of 65 acres, located at Fifth Avenue and Thirty-Ninth Street, North; and a site in Avondale owned by F. E. Smith, A. W. Smith and D. T. Smith.

It was decided the location of the Fleet Corporation was the most desirable. In an effort to acquire this property, several trips to Washington were made but the Fleet Corporation declined an option. An offer of $150,000.00 was made for the property, along with an agreement that the Fleet Corporation be permitted to retain their machinery which was in the buildings. The offer was rejected. Upon the advice of the engineering company, it was decided to acquire the thirty-two acre tract at North Birmingham from R. S. Munger, who donated ten acres of the tract. The price paid was $66,700.00.

Work was started on a machine shop building, measuring 100x300 feet, a foundry building measuring 130x400 feet, and a power plant. Railroad trackage was available to the property but a side track had to be installed.

Sales, as anticipated, had been very large for 1920 and at the October meeting of the Executive Committee, the treasurer reported there was a surplus of $3,900,000.00 invested in plant improvements, bills receivable and accounts receivable. The treasurer recommended that the capital stock of the Company be increased from three million to six million dollars. The Committee approved this, and a call was issued for a stockholders meeting. The meeting was held on November 9th and the recommendation of the Executive Committee was approved. On November 20th a fifty percent stock dividend was declared.

Conditions generally over the country in the fall were gradually tightening; collections were somewhat slow, and a large surplus of cotton was anticipated for 1921. The sales offices predicted sales for 1921 would be exceedingly light. The Company was repossessing some of the outfits sold. The warehouses were well stocked with equipment already manufactured; however, R. S. Munger and D. T. Smith felt the shop men should not be dismissed during the winter months and that the Company should continue manufacturing.

The year 1921, as predicted, was a disastrous one. Conditions were such that in January, H. K. Ferguson Company, which had started to work in the fall of 1920 on the buildings in North Birmingham on a cost-plus contract, was instructed to discontinue all work until conditions became more favorable.

In addition to the many problems confronting the Company, there was a great loss in the death of S. I. Munger, President, who passed away on March 28, 1921 after a brief illness. Though his residence was in Dallas, he came to Birmingham for three or four days each month to attend the meetings of the Executive Committee, of which he was chairman. He had served eighteen years continuously as president, and was one of the most loved men in the organization.

On May 3rd the factory forces were reduced in all plants and reductions were made in salaries and wages throughout the organization.

At a meeting called on May 17, 1921, R. S. Munger was elected president and Daniel Pratt was elected vice president; T. R. Collett, district sales manager at Dallas, resigned, and was replaced by J. S. McAnulty who had been assistant district sales manager. Earlier in the year, Eugene Munger, son of R. S. Munger, was elected superintendent of the Machinery Improvement Department.

By July the Company had to let all the factory forces go except the foremen, who were retained in order to take care of repairs. The Bridgewater plant was ordered closed, the plant was dismantled and the patterns shipped to the Prattville factory. In order to further cut down expenses, the Charlotte, North Carolina office was closed and was never reopened. The Atlanta office then handled the North Carolina and South Carolina business.

The excess profits tax law was in effect and the profits in 1920, the largest ever made by the Company, were subject to this tax. Borrowing was necessary to meet this obligation. For the first time since the Company was organized, it showed a loss, and a very heavy one. The predictions made the year before certainly did come true in 1921.

The year 1922 started off with considerably brighter prospects, and the only change made in the officials was the election of S. I. Munger, Jr. to replace his father on the Board of Directors. H. W. Brooks, District Sales Manager at Memphis, was in poor health and was granted a leave of absence with pay for a period of eight months. F. S. Middleton, who had been with the Company since his college days, was made assistant district sales manager.

For two or three years the cotton crop was being gathered with more and more hulls and trash, especially in West Texas, where there was a scarcity of labor. They had begun to pull the cotton, boll and all, rather than pick it. There was very little machinery used ahead of the gins, except cleaning machinery. This opened the bolls but would not remove the hulls, the huller gin being the only means of removing the hulls. As a result the Pratt Double Rib Huller gin, which separated the hulls from the seed, became very popular, and to such an extent the Company was forced to make the Munger gins with the double ribs at Avondale, Atlanta and Birmingham.

Years earlier, the Machinery Improvement Department had developed a combination cleaner and separator called the Munger Cleaner Separator, and also had developed the Munger Improved Cleaner. In 1920 they began to work to develop a feeder-extractor, a machine which would take the hulls out of the cotton before reaching the gin. By 1921 the machine was perfected and quite a number were sold in West Texas in that year and 1922. The machines that were in operation in 1921 proved satisfactory, but it was a dry season and the hulls broke up readily, thus being removed easily. The fall of 1922 being a wet season, the hulls would not break up because they were soft and leathery. As a result, the machine would not shed the hulls.

L. P. Munger, who had helped in the development of the machine, was sent to West Texas in 1922 to see if he could remedy the trouble. He found by cutting an opening in the hull board and allowing the hulls to escape more freely, the trouble was eliminated. As a result, all of these machines in the field were changed. The John E. Mitchell Company of St. Louis had been making the only feeder-extractor for several years, selling it largely in Missouri and Arkansas where the cotton was full of hulls. Later they began selling these machines in West Texas.

In December 1922 Mr. Mitchell notified Continental Gin Company that the machines they had changed were infringing his patent. The matter was taken up with patent attorneys and the opinion rendered indicated the opening in the hull board made in the machines by the Company caused the infringement. It was hard to convince R. S. Munger that Mr. Mitchell could patent a slot in a board. Mr. Munger finally agreed with Mr. Mitchell that Continental Gin Company had unwittingly infringed his patent. A settlement was reached and the John E. Mitchell Company received $75.00 per machine royalty on all that had been produced, with the understanding that Continental Gin Company would produce no more machines after 1923. In January 1923 the Company worked out an exclusive contract with the Mitchell Company to sell their feeder-extractor in all territory west of a line drawn north and south through Little Rock, Arkansas, and later changed to include all territories. This was the first record of the Continental Gin Company being a distributing agent for a product produced by another company.

On April 20, 1923, R. S. Munger died after a short illness. This was a very great loss, not only to the Company but to the South. Mr. Munger never missed an opportunity to assist any one. His close friend, A. L. Smith, recites an incident that was very characteristic of Mr. Munger, as follows: "Mr. Munger in driving in from the golf course, passed through Woodlawn, a suburb of Birmingham, one cold, raw, rainy Saturday afternoon and saw an old lady standing on the sidewalk with an umbrella in one hand and a suitcase in the other. He had gone almost a block past her before he could stop his car, but he stopped and backed to where she was standing, and asked her where she was trying to go. She stated she was going to the Terminal Station downtown, and he promptly replied: `Get right in, Madam, and I will take you there.' This was characteristic of him."

Daniel Pratt, Vice President, called a meeting of the directors on May 21, 1923, and Mrs. R. S. Munger was elected a director of the Company, as well as a member of the Executive Committee and trustee of the Munger Benefit Fund. M. P. Northington informed the directors that Mrs. Munger had expressed a wish to have more time to familiarize herself with the affairs of the Company before a new president would be elected. Her request was granted.

A directors meeting was held on October 10, 1923, at which time L. R. Munger, son of S. I. Munger, was elected president. L. R. Munger had recently returned from a trip to Europe. It was at this meeting that a committee composed of D. T. Smith, Daniel Pratt and Eugene Munger, was instructed to start again the construction of the new plant in North Birmingham, work on which had been discontinued two years before.

On January 26, 1924, shortly after the annual meeting, another great loss was sustained in the death of D. T. Smtih, General Superintendent, in charge of manufacturing since 1901. His knowledge of gin machinery had made him invaluable to the Company and the high regard the shop men at all the factories had for him made the loss all the greater.

F. E. Smith, who was superintendent of the Avondale factory, was made general superintendent and also elected a director and member of the Executive Committee. F. E. Smith was a brother of D. T. Smith.

Because of ill health and inability to attend the meetings, Mrs. R. S. Munger requested that her resignation be accepted as a director. L. P. Munger, her son, was elected to succeed her.

The question of continuing work at the North Birmingham site or changing the location of the new plant was brought up. It was decided to dismiss the idea of building the plant in North Birmingham and acquire a tract of land in Avondale, consisting of twenty-six acres. This acreage, known as the Smith tract, located on Fifth Avenue and Forty-Fifth Street, South, was purchased from the Title Guarantee Loan & Trust Company as trustee, for a consideration of $42,000.00.

The Bridgewater Plant was sold at a price of $11,000.00. This was for the real estate only as the buildings were worthless.

J. A. McLin was appointed superintendent at the Memphis factory, replacing John Morefield.

On May 14, 1924 a contract was made with H. K. Ferguson & Company to build a new plant on the new Avondale site. During the following month work was started on the foundry and machine shop buildings.

On September 1, 1924 Mrs. R. S. Munger, a former director and the only woman ever on the Board, died after a lengthy illness. She was a fine Christian character and dearly beloved by all who knew her. She had made several large contributions to various causes, especially to Birmingham-Southern College in Birmingham.

The Company had been manufacturing a mechanical tramper in the place of a steam tramper, originally in use for tramping cotton in a press box. The patents were secured on this tramper from the San Antonio Machine & Supply Company. However, in the fall of 1924 the patents of E. R. Jacobs of San Antonio were purchased, which also covered a mechanical tramper, but an improvement over the one being used. This design tramper is still being manufactured by the Company at the present time.

At the stockholders meeting on January 8, 1925, and .the directors meeting which followed, there were a few changes: A. L. Smith was added to the Board of Directors; W. S. Reynolds was made assistant district sales manager at Birmingham; Walter S. Going was made export manager; L. L. Perrine was made superintendent of the Atlanta factory to succeed A. W. Merkel, who was taking charge of the new plant at Birmingham; and T. B. Richey was made superintendent of the Avondale plant. W. B. Lewis resigned as traffic manager and O. W. Martin succeeded him.

By March of 1925 the foundry and machine shop of the new plant had been practically completed. New tools had been ordered several months before, and practically all had been delivered and were being placed. The Company had been manufacturing a diesel oil engine for almost two years at Atlanta, and transferred this work to the new plant. A special bay had been provided with tools for making a heavy duty two-cycle oil engine. The first run in the foundry took place on March 12th.

In April the general superintendent and general sales manager were instructed to visit Atlanta and, if they found it advisable to transfer the Atlanta factory equipment to the new plant in Birmingham, to decide what steps should be taken. Later they reported that work should be discontinued in the fall of 1925, but the sales office and a repair shop should be continued in Atlanta. Sites were investigated for the location of a sales office and repair shop in the event a purchaser was found for the Atlanta plant. It was finally decided that the Company would retain enough of the Atlanta property for the sales office and repair shop.

The president was authorized to sell the property that had been purchased for the new plant at North Birmingham, the Birmingham factory near East Birmingham, and the Avondale factory. In April 1925 plans had been drawn and the contract let for the construction of an office building at the new plant. By summer the new plant was completed with the exception of the office building, and the new tools as Well as any tools from the Birmingham and Avondale factories that were usable, were being placed. By October the manufacturing of stock for the year 1926 was begun.

The Company was selling ginning machinery in all countries where cotton was grown, and the export business, like domestic sales, was affected very much by the amount of cotton grown and its price.

Before the close of World War I, South Africa, due to the high price of cotton and the fact they had the soil, climate and cheap labor, began to raise cotton; they purchased quite a large amount of machinery from the Company, including a large number of system outfits. It appeared they would rival the United States eventually in the amount of cotton raised. However, before all of the machinery purchased was delivered, the locusts ate up the crop one year; the drought ruined it the second year, and the crop was destroyed by insects the third year. Of the machinery shipped to South Africa, much of it was never uncrated. Cotton was then given up as the main crop, however, at the present time many planters are again turning their attention to cotton.

While Egypt is considered a good cotton growing country, their staple is so long that the saw gins produced by the Continental Gin Company could not compete with the English in selling roller gins, the type used in ginning Egyptian cotton.

D. T. Smith, while general superintendent, made several trips to Russia; S. I. Munger, Jr. made a trip to India, and Walter S. Going made a trip to Australia, the Philippines and India, all in an effort to attract export business and to study the conditions of the various countries.

Export business with the Company had constantly improved since the United States Government began to reduce the acreage for producing cotton in this country and the foreign countries began to increase their acreage.

The first twenty-six years of Continental Gin Company brought about many changes in machinery and personnel. On gins, the Company changed from a main belt to an independent saw and brush drive; from ten-inch to twelve-inch saws; from wick oiling to ring oiling and then to ball bearing. In system outfits, all sizes of gins were discontinued except one, an 80-saw. From several different types of gins originally made, only the Munger and Pratt double rib huller gins were being made.

The Company produced the Munger Improved Cleaner, and the Munger Cleaner-Separator, replacing the old vacuum box in system outfits. Due to the necessity of cleaning cotton before it reached the gin, the pneumatic type elevator had practically been discontinued. On Feeders the upright cleaner replaced the basket, and then the Feeder-Extractor was introduced; on Presses, from 4-inch, 5-inch and 7-inch power to practically only hydraulic power; on Trampers from steam to mechanical, and other changes were made by the Company in its effort to keep abreast of the times.

The changes in personnel, especially in the sales departments and factory superintendents, were comparatively few, but in the general officers and directors, there had been many changes. Of the original twelve directors, only five were left on the Board, namely: F. C. Gammons, C. R. Winship, Daniel Pratt, A. W. Smith and Joe B. Bell.

During the first twenty-six years, Continental Gin Company paid dividends to stockholders every year, with the exception of the first three.

05/09/2007