AVT, Inc. (OTCMKTS:AVTCQ) Files for Bankruptcy
Yesterday AVT, Inc. (OTCMKTS:AVTC) filed for chapter 11 bankruptcy. By the closing bell AVT was 63% in the red on volume of 1.37 million shares, far exceeding the average.
The vending machine company put up official word of filing for chapter 11 court protection yesterday morning. Despite the news, the PR maintained a pretty upbeat tone about the whole thing, expressing belief that AVTCQ will not only go on but “emerge on an even stronger footing”, primed for “future success”.
A further 8-K filing details that the company received a notice of Entry of Judgment, under which the company is liable for $2,930,000. The issue here is that this lawsuit does not seem to have been disclosed in previous company filings. The bankruptcy 8-K states that management believed the lawsuit “was non-material”, which could explain the seeming lack of disclosure.
The company had also gone delinquent in its SEC filings, with its most recent SEC 10-K covering the year ended December 2013. There are two additional financial reports on the OTC Marketplace page of the company, but those are pink sheet interim report disclosure filings, containing just balance sheets and cash flow info, without any detailed reporting and full-text disclosure.
It remains to be seen how things will pan out for the company but considering the lawsuit and the bankruptcy it entailed practically blindsided investors, there may be more than a few rough patches ahead.
