The savior comes calling

Moses and his cohorts were hailed by Haywood County officials in October 1997 when plans were announced for the purchase of the old Dayco building and the creation of up to 500 jobs. It was almost a year since the rubber products firm had shut down and a community that had long relied on steady manufacturing employment was left reeling from the loss of 700 jobs.

In came Moses, and though his past was shady, many local officials held out hope the group might indeed make good on a promise to build tankless hot water heaters at the old Dayco building. After all, Moses claimed to have orders for up to $1.3 billion worth of the heaters, said a revolutionary patent was pending, and promised production would begin as early as January 1998.

But reporters began turning up a checkered history at the same time the company’s financial picture began to cloud. An October 1997 Knoxville News-Sentinel article detailed how at least two previous tankless hot water heater ventures by Moses in Tennessee had failed to materialize, and several economic development officials there were questioning the group’s viability. Articles from that same newspaper revealed that creditors in Tennessee were trying to get paid for various debts incurred by the company.

The unraveling begins

Back in Haywood County, the group’s fortunes began to unravel quickly. The first deal to purchase the building — using the Haywood Advancement Foundation as a go between (the same group who now is trying to get the building now) — fell through in December 1997. The group then secured a $75,000 loan from Clyde Savings Bank in March 1998, which it used to secure the deed on the building from Dayco’s parent company, Mark IV. The remainder of the $2.5 million would be paid, supposedly, when production started. So for the price of the monthly payment on a $75,000 loan, Moses and Thermal Products acquired the huge Dayco complex.

But even with the building, Moses and Thermal Products needed money to start productions. They were seeking $10 million in grants from a government entity that would be tax exempt. But the Local Government Commission said the company’s financial data was incomplete. The county subsequently did not enter into an agreement to obtain the bonds. Waynesville and Clyde turned down similar requests by Thermal Products to act as the tax-exempt entity for the bonds.

In September 1998, Thermal Products transferred the property to Enterprize Park, and now Moses and others touted a plan to turn the property into a retail outlet mall.

Nothing materialized, however, and by January 1999 a growing debt burden prompted foreclosure proceedings. Clyde Savings Bank had not been paid any principal or interest on its $75,000 note; about $100,000 in county and town taxes had not been paid; and sheriff Tom Alexander was helping a furniture company remove desks and office furniture for nonpayment.

In December 1999, Enterprize Park was able to secure a $700,000 loan from CHW, a limited liability company located in Lexington, N.C. The company also was able to get a $200,000 investment from an individual now being represented by Asheville attorneys. Also, it was collecting rent from Lea Industries for warehouse space. All told, officials say the company was able to raise about $1.3 million.

Despite raising the money, nothing ever happened at the facility. Then, in July 2000, Grand Ridge Corp. was formed. Assets from Enterprize Park were transferred to it. Still nothing happened, and CHW began trying to collect payments at the same time Haywood County was working to collect tax payments that today total $126,000.

Foreclosure began in earnest in August 2001, but Grand Ridge was able to stall for several months. In March a new corporation known as Landmark, which has some of the same officers as Thermal Products, Enterprize Park and Grand Ridge, offered $2.5 million for the plant.

Haywood tries again

Now Haywood officials made their bid of $1.3 million. They hope to convince the bankruptcy judge that they can turn the building into an economic opportunity for Haywood County — and that they have real money and a real plan for the building.

If the Haywood offer is approved during the proceedings on April 17, economic development officials plan to tear down most of the property and sell warehouse space. Mark IV, the parent company of Dayco, would retain liability for any environmental problems that may be found when demolition begins.

“I think we can make a strong case that we deserve the building and can do something with it,” said Jay Henson, the county’s economic development director.

Plans are to sell a portion of the building to Griffith Rubber — which presently manufactures rubber at the facility — for around $800,000. The warehouses would sell for approximately $2 million. That would provide a total of just over $4 million.

CHW would get about $1 million and other creditors about $1 million. The other $2 million would demolish existing buildings and there would some money left for marketing the building.