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Avatex Corp. (fka AVATQ)

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Avatex Corp. (fka AVATQ)

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Penny Machine Free
12/07/11 9:26 AM
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Re: #43: @smokestack - Wow, that's unreal.
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11/25/11 11:29 AM
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Re: #43: @smokestack - Wow, that's unreal.
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Re: #39: @PennyStockYoda - Yep. Access to L2.
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11/16/11 10:31 AM
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Re: #43: @smokestack - Wow, that's unreal.
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11/16/11 10:18 AM
Post #46
Re: #38: @sidedraft - Have your broker look here:
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11/14/11 9:43 AM
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Re: #38: @sidedraft - Have your broker look here:
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Re: #38: @sidedraft - Have your broker look here:
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11/09/11 9:53 AM
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Re: #39: @PennyStockYoda - Yep. Access to L2.
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11/08/11 2:28 PM
Post #41
Re: #38: @sidedraft - Have your broker look here:
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11/08/11 2:27 PM
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Re: #39: @PennyStockYoda - Yep. Access to L2.
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11/08/11 1:57 PM
Post #39
Re: #38: @sidedraft - Have your broker look here:
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sidedraft Free
11/08/11 1:50 PM
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Re: #37: @PennyStockYoda - "Due to a lack of market transparency, this
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11/08/11 12:48 PM
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Re: #30: @Hammer1 - WEll youv'e DD this one more than me
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11/08/11 10:49 AM
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Re: #33: @Penny Machine - Hey Smokestack,
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11/08/11 10:45 AM
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Re: #32: @smokestack - Sir i haven't done any DD here. However
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11/07/11 9:22 PM
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Re: #30: @Hammer1 - WEll youv'e DD this one more than me
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11/07/11 9:20 PM
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Re: #30: @Hammer1 - WEll youv'e DD this one more than me
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11/07/11 9:18 PM
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Re: #24: @smokestack - LMAO here, 100 shares bought at 1 buck
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11/07/11 8:37 PM
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Re: #27: @smokestack - I'll just have to miss it, good luck
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11/07/11 8:14 PM
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Re: #26: @Penny Machine - Only funny till Short Squeeze happens, then it's
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11/07/11 8:09 PM
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Re: #24: @smokestack - LMAO here, 100 shares bought at 1 buck
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11/07/11 7:54 PM
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Re: #23: @Hammer1 - What the hell is GOING ON HERE? Hammer
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11/07/11 7:49 PM
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Re: #23: @Hammer1 - What the hell is GOING ON HERE? Hammer
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Re: #22: @Penny Machine - AVATQ Float Owned at $20 Range
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Avatex Corp. (fka AVATQ) RSS Feed

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Short Squeeze Candidate

Avatex Corp

http://www.bloomberg.com/apps/quote?ticker=AVATQ:US
Shows

Float 11,655,000

Outstanding Shares 19,637,000


Avatex Corp.
6422 Riverview Lane
Dallas, TX 75248-2838
United States

Short Squeeze Candidate

Avatex Corporation's assets were liquidated and the court signed the final decree on 6/30/2004. Avatex Corporation operates as a holding company that owns interests in other corporations and partnerships. The company, through Chemlink Acquisition Company, LLC, controls 50% interest in Chemlink Laboratories, LLC, which principally develops, manufactures, and distributes proprietary effervescent tablet and granule formulations for use in cleaning, disinfecting, and sterilization applications. In addition to pursuing opportunities in the dental and medical markets, Chemlink has developed a patentable formulation and process for the manufacture of effervescent tablets, granules, and powders. The company owns approximately 13.5% interest in Presby Corp., a privately held company that has developed a surgical technique called the Surgical Reversal of Presbyopia, which uses a patented medical device, the Scleral Expansion Band, to treat presbyopia. Avatex owns the equivalent of an approximate 14.5% interest in iLife Systems, Inc., a privately held corporation. iLife owns certain patents issued or pending, which provide for electrode-free methods for detecting and analyzing breathing, heart rate, and body motions, as well as methods for microwatt wireless transmission, for digital data recording, and for electrode-free, infrasound-based detection and intervention. In addition, it owns interest in Phar-Mor, Inc., which operates a chain of discount retail drugstores. Avatex was founded in 1929. On December 11, 2002, Avatex Corporation, along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the US Bankruptcy Court for the Northern District of Texas. The plan was later approved as Chapter 11 liquidation on April 14, 2003.

Chemlink Laboratories, LLC

http://www.chemlinklabs.com/


        We, through CLAC, control 50% of the voting interests of Chemlink. Effective March 31, 2002, CLAC was able to designate the majority of Chemlink's directors as a result of a restructuring and an additional investment by CLAC in Chemlink, as discussed below. Therefore, Chemlink was consolidated with us at March 31, 2002. Prior to that date, we carried Chemlink on an equity basis.

        Chemlink is principally engaged in the development, manufacture and distribution of proprietary effervescent tablet and granule formulations for use in cleaning, disinfecting and sterilization applications. In addition to pursuing opportunities in the dental and medical markets where it has shipped products for the last several years, Chemlink has developed a unique and patentable formulation and process for the manufacture of effervescent tablets, granules and powders. This new technology significantly expands the options for both the types of ingredients as well as the concentration of ingredients that can be utilized in effervescent formulations. As a result, the new technology creates an opportunity to develop effervescent formulations for many laundry detergent and cleaning products for both consumers and businesses which have, to date, been impractical because of the limitations inherent in older effervescent technologies.

        Before March 31, 2002, CLAC owned 50% of the voting rights in Chemlink and accounted for its investment in Chemlink on an equity basis. CLAC had originally acquired its 50% interest for approximately $8.2 million. During 2002, CLAC made additional investments in Chemlink in order to provide operating funds to Chemlink. CLAC invested $1.4 million in Chemlink in May and

September 2001. The additional investment in September 2001 was part of an overall restructuring of the membership interests in Chemlink. As part of the restructuring, the May and September contributions were invested in Preferred C membership interests ("Preferred C") which will earn a preferred return and have preference in liquidation over all other membership interests. In addition, CLAC's prior investments in Chemlink were modified and will also earn a preferred return and have preference in liquidation to other members' interests in Chemlink. CLAC's voting interest in Chemlink remained at 50% of the total membership interests entitled to vote on most matters after the restructuring. In December 2001 and March 2002, CLAC made additional investments of approximately $0.6 million in order to continue to provide operating funds to Chemlink. CLAC received additional Preferred C interests and the right to appoint a majority of Chemlink's board members effective March 31, 2002. Therefore, because we controlled Chemlink as of March 31, 2002, its assets and liabilities have been consolidated as of that date. The remaining 50% of the voting rights of Chemlink that CLAC does not control are accounted for as a minority interest in the consolidated balance sheet.

        While CLAC and others have had to fund Chemlink's operations due to a lack of significant sales during the year, Chemlink currently anticipates entering into several contracts which should provide funds to cover at least a portion of its future operating expenses. Chemlink is in discussions with other companies which may provide the additional business needed to allow Chemlink to totally fund its operating expenses and to potentially increase its liquidity and/or allow it to distribute the preferred returns on its Preferred C and other membership interests. Until such time, however, CLAC or other investors may continue to have to make contributions to fund Chemlink's ongoing operations.

        In addition to our investment of approximately $3.5 million in CLAC in prior years for a 41.1% interest, we invested approximately $1.6 million in fiscal 2002 in order to provide our portion of the funds used by CLAC to make its additional investments in Chemlink in fiscal 2002, as described above. Of the amount invested in fiscal 2002, we invested $1.1 million in CLAC in May and September 2001 as part of an overall restructuring of CLAC's membership interests. The membership interests we received for our additional investments will earn a preferred return. We also increased our ownership interest in CLAC's voting rights from 41% to 59% as of September 1, 2001 as a result of the restructuring as certain other members, including Phar-Mor, were unable or decided not to contribute based on their original ownership in CLAC. We made additional contributions of approximately $0.5 million in December 2001 and March 2002; however, our ownership percentage in CLAC remained at 59%.

        Therefore, since September 1, 2001, because we have owned 59% of the voting rights in CLAC, we have reported CLAC's results on a consolidated basis. The remaining 41% of the voting rights in CLAC that we do not own are accounted for as a minority interest from that date.

Phar-Mor, Inc.


        We own approximately 48.1% of Phar-Mor's outstanding common stock at March 31, 2002. Phar-Mor filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code on September 24, 2001. Phar-Mor has since closed approximately 65 of its 139 stores as part of its plan to emerge from bankruptcy. Depending on the outcome of Phar-Mor's bankruptcy proceeding, we may lose all or part of our investment in the common stock of Phar-Mor. Therefore, we are unable to currently determine the market value of our investment in Phar-Mor common stock. Our Co-Chairmen and Co-Chief Executive Officers, Abbey J. Butler and Melvyn J. Estrin, continue to serve as Co-Chairmen and Co-Chief Executive Officers of Phar-Mor.

        During fiscal 1999, Phar-Mor acquired 2,086,200 shares of our common stock at a cost of approximately $5.0 million. In December 1999, Phar-Mor acquired an additional 2,862,400 shares of our common stock for approximately $5.7 million. As a result, Phar-Mor owns 25.2% of our issued Class A common stock. To the extent that we own 48.1% of Phar-Mor, we have treated an equivalent

amount of Phar-Mor's cost of our common stock similar to treasury stock and have consequently reduced stockholders' equity. We also have reduced the number of shares outstanding when calculating earnings per share to reflect our 48.1% equity ownership interest in our own Class A common stock owned by Phar-Mor.

Presby Corp.


        We own the equivalent of an approximate 13.5% fully-diluted interest in Presby Corp. ("Presby"), formerly RAS Holding Corp., assuming conversion of the outstanding Presby convertible preferred stock and the exercise of all the outstanding Presby options and warrants. We have invested a total of $2.4 million in the Series B convertible preferred stock of Presby (the "Series B Preferred").

        Presby is a privately-held company that has developed a surgical technique called the Surgical Reversal of Presbyopia, which uses a patented medical device, the Scleral Expansion Band ("SEB"), to treat presbyopia. Presbyopia is, in general, the loss of the human eye's ability to focus at near distances due to aging, resulting in the need for reading glasses or bifocals. We have been advised that Presby has completed the surgical procedures required for its Phase I clinical trials in the United States and that it has received approval from the U.S. Food and Drug Administration (the "FDA") to proceed with clinical studies required for market approval in the United States. However, the final outcome of the trials and achieving commercial success of the technique are each highly uncertain. In addition, Presby has advised us that they have sought FDA approval to start clinical trials in the United States for use of the SEBs to treat certain forms of glaucoma and ocular hypertension. Similar studies related to the treatment of presbyopia, ocular hypertension and glaucoma have begun in Canada. Presby has also developed related products which include a specialized incision device and replacement blades for use with the surgical procedure, thus providing more consistent and reliable outcomes.

        In March 2002, Presby entered into a license agreement with CIBA Vision AG ("CIBA"), a subsidiary of Novartis AG. Under the license agreement, Presby granted to CIBA an exclusive worldwide license to market and sell Presby's ophthalmic surgical products for use in the treatment of presbyopia, ocular hypertension and primary open angle glaucoma. CIBA will assume responsibility for the manufacture of the licensed products following a transition period and has committed to provide additional cash infusions to Presby when Presby meets certain future milestones. Because Presby retains responsibility for FDA trials and product development, it may still need to obtain additional financing from other sources in order to complete its FDA trials so it can bring its products to market in the United States.

        Our Series B Preferred has voting rights equivalent to the common stock of Presby and accrues dividends at 12% per annum less 85% of any amounts paid to RAS Service Co, LP ("RAS Service") as described below. The accrued dividends were deferred until the last day of the month following December 2001 (or, at Presby's option, in quarterly increments from that date to the last day of the month following September 2002). Presby has exercised the option to defer payment until at least the last day of the month following June 2002. In addition, during fiscal 2001 the number of shares of common stock into which each Series B Preferred is convertible was changed from 2.1:1 to 2.52:1 as a result of Presby not meeting certain goals set forth in the applicable certificate of designation.

        RAS Service is a limited partnership whose partners were the original owners of the Series B Preferred and another partnership that included certain principals in Presby. RAS Service has a service contract with Presby under which it provides advisory and consulting services to Presby and receives the lesser of $20 per SEB sold or 5% of the net sales price of each SEB after commissions (calculated on a quarterly basis) for providing these services. Of the revenue recognized by RAS Service, 85% is payable to the Series B Preferred partners and 15% is payable to the other partner. The dividend on the Series B Preferred is reduced, but not below zero, by the 85% of the revenues due the Series B Preferred partners. A subsidiary of ours is the general partner of RAS Service and receives

approximately the first $15 thousand of the fees due the Series B Preferred partners. The remainder of the fees earned by the Series B Preferred partners are split among the partners based on their original investment in the Series B Preferred. Payment of the fees by Presby to RAS Service was deferred until the last day of the month following December 31, 2001 (or in quarterly increments from that date consistent with the Series B Preferred deferral date). Presby has deferred the payment until at least the last day of the month following June 2002. The service contract expires September 30, 2006 (or on December 31, 2006 if the Series B Preferred payment date is deferred to September 30, 2002).

        In connection with a potential future investment by CIBA or others, the terms of the Series B Preferred and the RAS Service contract with Presby may be subject to modifications to be negotiated by the holders of the Series B Preferred and the new investors, including but not limited to the payment and/or further deferral of the accrued dividends of $0.7 million and the accrued service fee of $0.1 million.

Investment in  i  Life Systems, Inc.


        We own the equivalent of an approximate 14.5% interest, on a fully-diluted basis, in i Life Systems, Inc. (" i Life"), a privately-held corporation. i Life owns certain patents issued or pending which provide for reliable, electrode-free, non-invasive methods for detecting and analyzing breathing, heart rate and body motions as well as methods for microwatt wireless transmission, for digital data recording and for electrode-free, infrasound-based detection and intervention. i Life has incorporated these technologies into personal emergency response systems and wireless vital signs monitors. i Life's commercial sales and/or licensing revenues have been minimal to date.

        In fiscal 2002, i Life modified its corporate structure and set up a wholly-owned subsidiary, i Life Solutions ("Solutions"), which now owns or licenses all the assets and assumed all the liabilities formerly held by i Life. We, along with other investors, loaned Solutions $1.0 million (our share was approximately $0.2 million) which is secured by the assets of Solutions. i Life is attempting to find additional outside investors in order to provide funds to continue its operations and has reduced the number of its employees and deferred the salaries of certain of its employees, with their agreement, for a period of six months. We wrote off our equity investment in i Life during the current fiscal year to reflect what management believed to be an other than temporary decline in value. We believe that there is adequate value in i Life to eventually recover our $0.2 million loan to Solutions.

        We originally invested approximately $1.3 million in i Life in December 1997 to purchase Series B convertible preferred stock (the "B Preferred") for what was then a 6.3% fully-diluted ownership interest in i Life. In addition, we made various loans to i Life during fiscal years 2000 and 2001. The loans had a carrying value of approximately $1.9 million at maturity in March 2001 and, in connection with additional investments into i Life by third parties, were converted into an equivalent number of shares of redeemable Series C convertible preferred stock ("C Preferred") at $1.30 per share. We have also received a total of 3,720,207 warrants to purchase common stock at $1.30 per share as part of these transactions. These warrants expire between March 2005 and March 2006. As described above, we believe the B Preferred, the C Preferred and the warrants have no current value and, accordingly, have written off our $3.4 million equity investment in these securities in fiscal 2002.

Other


        In May 2000, we invested approximately $0.2 million to acquire a 41.5% interest in a Delaware limited liability company, Cyclone Acquisition Company, LLC ("Cyclone"), which acquired the rights to the "Cyclone Fence" name from Cyclone, Inc. at a cost of $0.3 million. Cyclone is attempting to license the "Cyclone Fence" name to fence retailers. After initial attempts to license the name to large home improvement retailers were unsuccessful, we wrote off our investment in Cyclone in fiscal 2001. Further attempts to license the name are continuing.

        At March 31, 2001, we owned approximately $1.9 million of preferred stock of HPD Holdings Corp. ("HPD"), which was a privately held corporation whose subsidiary manufactured and distributed household product lines. At the time of our initial investment in April 1998, we also received 2.5% of the common stock of HPD. In February and April 2000, we invested approximately $0.1 million in a subordinated debenture of HPD and received warrants to purchase additional common stock of HPD at $.01 per share that would have expired February 1, 2010. In April 2001, WD-40 Company acquired all of the outstanding common and preferred stock of HPD and repaid its debentures. We received a total of approximately $2.6 million for our HPD investment resulting in a gain of approximately $0.6 million that was recognized in fiscal 2002.

        The interests in CLAC and Presby noted above are our direct interests and do not give effect to Phar-Mor's investments in these same companies. Phar-Mor has an approximate 7.2% interest in Presby on a fully-diluted basis. Phar-Mor also owns approximately an 18% interest in CLAC.

Environmental Regulation


        We, like many other enterprises, are subject to federal, state and local laws and regulations governing environmental matters. Such laws and regulations primarily affect our previously sold or discontinued operations where we retained all or part of any environmental liabilities on conditions existing at the date of sale.

        We anticipate that compliance with statutory requirements related to environmental quality will continue to necessitate cash outlays by us for certain of our former operations. The amounts of these liabilities are difficult to estimate due to such factors as the unknown extent of the remedial actions that may be required and, in the case of sites not owned by us, the unknown extent of our probable liability in proportion to the probable liability of other parties. Moreover, we may have environmental liabilities that we cannot, in our judgment, estimate at this time and that losses attributable to remediation costs may arise at other sites. We recognize that additional work may need to be performed to ascertain the ultimate liability for such sites, and that further information may change our current assessment. See Note L to our consolidated financial statements and "Item 3. Legal Proceedings" contained herein for a discussion of outstanding environmental actions.

Employees


        We employed 21 persons at March 31, 2002, including the 11 employees of Chemlink and excluding the employees of Phar-Mor.
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