Be careful with explanation notes !

Introduction : Northrop the first commercial computer customer

In 1939 Jack Northrop founds Northrop Aircraft Inc. This aircraft manufacturer is established nearby Hawthorne, California. The Northrop F-5 Freedom Fighter will become one of the most effective and sucessful U.S. air-to-air fighters in the 1960s and early 1970s. Already during World War II Northrop starts developing missiles and from the 1950s unmanned aerial vehicles are produced as well. The fine vignette above can be seen on a certificate from the Northrop Corporation. 

Just after World War II, Northrop orders from the Eckert-Mauchly Computer Corporation (EMCC) an electronic stored-program computer to deal with the many complex calculations required for the design and construction of aircraft and missiles. EMCC develops the BINAC, the Binary Automatic Computer and delivers it to Northrop in 1949. The BINAC is EMCC's first product and the world's first commercial digital computer. And so Northrop becomes the first company in the world using a digital computer. The BINAC, however, after delivery to its customer, turns out not to work properly. 

One year later Northrop develops on its own the Magnetic Drum Digital Differential Analyzer (MADDIDA), an electronic version of a mechanical differential analyzer. Such a device solves differential equations by integration. Another year later, in 1951, Northrop builds the Quadratic Arc Computer (QUAC), a special purpose digital computer which computes information to be recorded on magnetic tape for the XSM-62 Snark missile guidance system. In 1959 the name of the company is changed into Northrop Corporation. In the 1960s Northrop's Nortronics Division introduces the NDC-1051, a small general purpose digital airborne computer.

Northrop's history is a fascinating one. I hope you don't mind me bringing this little historic note as an introduction to the topic of this article. In fact, only this particular Northrop share certificate is relevant here.

Northrop Corporation
$1.45 cumulative preferred stock, specimen
Jeffries Banknote Company, printed in the 1960s

Hurray, interesting certificate ! Ew, what are these spots ?

In the image below, you can clearly notice that the spots in the certificate's left corner are actually printed characters. Click the image below, to enlarge the details.

How is that possible ? The certificate was clean, actually perfect at the moment of purchase. After acquisition the share certificate was put in a scripophily collector's album sheet at once.  

An explanation note is to blame.

The previous image shows an empty album sheet. Nothing to worry about ? Wait and see. Put a white paper in the album sheet. 

Now the imprinted characters become visible. Apparently these characters were the ones that were transferred to the share certificate. Strange. 

What actually has happened was this :

1. A certificate was put in the album sheet. Like many of us do, an explanation note was prepared, often a company profile, and put together with the certificate in the sheet.
2. Under pressure of the other sheets in the album, the characters of the note, mostly printed in black, were transferred to the transparant sheet side. Did you know that a full album weighs about 3 kilograms (6.6 pounds) and a big one, like the one shown 5 kilograms (11 pounds).
3. For some reason, the original certificate, and the corresponding note, is removed from the sheet. A portion of the note's characters remains invisible against the black backside of the sheet.
4. After some time, maybe months later, another stock certificate is inserted in that sheet again. Ignorant of any harm the album is stored away. 
5. A few days later, your new certificate is spoiled. Damage is done. Again under pressure, the characters of the note that was once put in that sheet, are transferred to your new certificate.

The Northrop logo consists of a stylished seagull
see image below

Tips

I've seen others on scripophily bourses showing certificates with accompanying notes in the same sheets. Some advice.

• Do not store your certificates together with explanatory notes in the same sheet. If you want to see a note along your scripophily items, put the notes in dedicated sheets.
• If you are not sure whether you use a brand new album sheet, use a blank piece of paper to check if any characters from an old note have been transferred onto the inside of the sheet. See the example image above.
• Is an album sheet spoiled with transferred characters, then throw away that album sheet.
• Is a certificate spoiled, then there is nothing that you can do. If you want to prevent that certificate from "contaminating" other album sheets, then put it in a smaller album sheet and store that whole in your album.

Northrop Aircraft, Inc.
100 common shares of $1, specimen
facsimile signature of John Knudsen "Jack" Northrop (1895 – 1981)
printed by Jeffries Banknote Co. around the 1940s

F.L.
Signed the Guest Book yet ?

Related links

• Northrop Corporation 
• Jack Northrop 
• BINAC 
• Smithsonian National Museum of American History, Computer Oral History Collection, 1969-1973, 1977

Four rules for online scripophily sellers

Four rules to keep in mind when shipping old bonds and share certificates :

1. You shall wrap them waterproof !
2. You shall not tape them !
3. You shall not fold them ! 
4. You shall not trim them !

Rule 1 : Wrap waterproof 

Certificates are usually shipped in a paper or cardboard envelope or package. The receiver of the package obviously expects a good reception, of course. However, packages are doomed to get wet due to bad weather conditions. Paper and cardboard just love water, they suck water whenever possible. Once wet, the package probably stays wet until its arrival. The contents of the package, a nice stock certificate, is also made of paper. Need I say more ?

Franklin Computer Corporation
Common shares, 1988

Below you can see what happened to this stock certificate of the Franklin Computer Corporation. It was not shipped waterproof. The certificate was simply put in an envelope by the sender.

interior of an envelope

The sender did not notice the nicely printed pattern on the interior of the envelope, and neither he expected his package would have to deal with rainfall, snow or water. The package got wet, the ink of the envelope pattern inside got wet and, under pressure, was transferred to the certificate. Not a nice result, despite three stickers labeled 'FRAGILE: Handle with Care' and a stamp 'DO NOT BEND'.

 

left: detail from the envelope's inner side , right: detail from the received certificate

double-click images to enlarge

Senders can avoid this situation simply by inserting the certificates in one or more plastic sleeves and tape the overlapping sleeves together (don't tape the certificate, see rule number two). This solution may not be 100% waterproof, but at least there is a greater chance that the certificate arrives in good condition.

Rule 2 : Do not tape certificates
This rule is obvious to collectors but believe it or not, some people fix certificates to an extra thin cardboard in the envelope with adhesive tape. Check out what happened to this specimen stock certificate of the Fairchild Camera and Instrument Corporation.

Fairchild Camera and Instrument Corporation
Common stock of $1, specimen, 1970s

The certificate was attached by tape to a thin cardboard.

This certificate was fixed to a thin cardboard in the envelope by means of ordinary adhesive tape. When the tape is applied with pressure, it sticks just "wonderful". I think the sender pressed the tape firmly, or the envelope must have been tucked away in the postman's bag between hundreds of other envelopes. Whatever .. I tried my very best to remove the tape gently and with the utmost care, but I could not prevent that a piece at the edge was teared away from the paper.

Removing the tape was a failure.

I contacted the seller and talked about this situation and by agreeing to refund a part of the amount paid, he kept a potential customer.

Time to repair ?

Large tears or spots can significantly reduce the value of your certificate by up to 70%!  Do try out repairs on a spare less preserved certificate that even might go lost in the process. Don't use ordinary adhesive tape. In its most recent issue from April 2010, Scripophily magazine discusses quite in depth how and when to repair tears, remove dirt or dealer pencil markings and much more. The magazine is published by the International Bond & Share Society.