Hampstead nuts and bolts manufacturer files for Chapter 11 bankruptcy

April 10, 1994|By Amy L. Miller | Amy L. Miller,Sun Staff Writer

A Hampstead manufacturer of nuts and bolts, whose president is serving time in federal prison for fraud, has filed for Chapter 11 bankruptcy.

Mil-Spec Fasteners Inc., whose facility on Route 30 appears deserted, is seeking to reorganize because of business difficulties, said the company's attorney, Yvette Diamond of Baltimore. The company, as of March 25, lists $499,851.91 in assets and $251,067.60 in liabilities, according to papers filed in U.S. Bankruptcy Court in Baltimore.

Ms. Diamond, who is representing the company with attorney David H. Cohen, refused to elaborate on Mil-Spec's business problems.

All calls to Mil-Spec's offices were referred back to the attorneys.

The business is still operating and they do intend to stay in business," Ms. Diamond said. "There's already been a meeting of the creditors, and another is scheduled for May."

Company President George A. Yezulinas, who is listed as the company's sole stockholder, was convicted with his son, George A. Yezulinas Jr., of fraud and conspiracy to commit fraud in September 1992.

The pair, with company Vice President Philip Karpovich, had been selling commercial-grade fasteners to defense contractors under the pretense that they were stronger, military-grade nuts and bolts.

Mr. Karpovich was found guilty of the same charges and sentenced to six months of home detention. The elder Yezulinas was sentenced to four years in prison. His son was sentenced to a 41-month prison term.

Assistant U.S. Attorney Ira Oring said the Yezulinases have about two more years to serve in federal prison. Officials at the federal marshal's office in Baltimore would not say where the men are being held.

"Under federal sentencing law, there is no parole except for a small amount of time given off for good behavior," Mr. Oring said.

Company assets listed in court papers included a condominium in Deerfield Beach, Fla.; bank accounts in Maryland and Florida totaling $5,354.53; four vehicles; approximately $300,000 in inventory; and $54,427.38 in accounts receivable.

Court papers said Mil-Spec took in $3,383,868 from May 1, 1991, to April 30, 1992; $1,944,340 from May 1992 to April 1993; and $890,754 from May 1993 to Feb. 28, 1994. Payments to company officials during the past year included $115,600 to the elder Yezulinas for business properties he leased to the company in Hampstead and Pompano Beach, Fla., and $3,041.50 to Mr. Karpovich for money the vice president lent the corporation, records said. Under liabilities, the company lists $203,786.49 owed to 180 unsecured creditors, ranging from a $14,215.55 claim by Thomas Publishing of New York to $13 owed to ABCD Industries in Baltimore.

Thomas, which provided advertising for Mil-Spec in the 1992 Thomas Edition of American Manufacturers, filed a collection suit against the Hampstead manufacturer in Carroll County District Court in December 1993. The suit has been stayed because Mil-Spec filed for bankruptcy.

Other large creditors include KAWG & F of Baltimore, Mil-Spec's outside accountant, for $8,899; B & G Manufacturing of Philadelphia for $7,104.98; and Harold I. Glaser, the Baltimore attorney who defended the Yezulinases during their federal trial, for $3,455.

Mil-Spec lists Wendover of Greensboro, N.C., and Carroll County Bank and Trust in Westminster as secured creditors. Wendover holds the mortgage on the Florida condo and Carroll County Bank is owed money for a 1991 Jeep Cherokee and a 1991 Chevrolet Caprice.

The company also owes Florida $3,967.71 in taxes accrued between April 30, 1986, and April 30, 1990, court papers said.

At the 1992 court sentencing, U.S. District Judge Benson E. Legg fined the elder Yezulinas and Mil-Spec $250,000 each. Court records show that Yezulinas' fine was paid in June 1993.

The corporate fine does not appear to have been paid. But it is not listed in the bankruptcy papers.

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