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When Larry sent me the picture and asked my opinion, I had this to say:
A set-up piece. They were adjusting the stamping jig. Dunno why it was
assembled, unless it was end of days or sold thru the employee store.
Cool though.
Now, let me explain just a bit. I never worked at Imperial Schrade. Or any other cutlery. I was at one time a prototyper, patent illustrator and a manufacturing process engineer. So I understand how an error can take place. Usually an error like this (as with coins) takes place when a process machine is being set up for a run. The set-up man stamps a trial piece to see where the die will strike. From there, he corrects the position of the jig holding the piece until the die strikes in the desired position. To save material, he would use the same trial piece for the second strike. There may have been a second trial piece that is this one's mate where the set-up man set the jig for even finer adjustment.
Why this one was assembled, I haven't a clue unless it was sent along with other set-up pieces through all of the processes to be used in adjusting other machines up to and including final assembly. The stamp suggests the blade is possibly an early one (SCHRADE vs. SCHRADE+). It may well have been kept in the sample room in a drawer for reference on future setups. The contents of those drawers were boxed and shipped with the lots sold in the liquidation auction in October of 2004. Loose components were also matched with whatever blades were laying around for assembly to boost the number of finished knives in the WIP prior to auction. Former employees have told us that when the factory closed, a small crew was kept on by the receivers to do this assembly work until the final auction. I am guessing that quality control was sketchy if not nonexistent.
It is also possible that it was sold thru the in-factory employees store. Impossible to tell at this point.
And this is just my best guess.
Value? Value is in the eye of the beerholder. For most collectors, it is a flawed example of the pattern and worth less than a perfect example. However, for a collector of errors and oddities, the knife would be worth a premium above a standard producion knife. I have been known to buy an error knife myself just for the novelty of it like this X-Timer XT2B....