Sonavation files for Ch. 11 reorganization; faces market without buyers
A United States company that designs and develops ultrasound biometric fingerprint scanners has filed for reorganization in the southern district of Florida’s West Palm Beach division.
Sonavation, founded by James David, filed for reorganization under Chapter 11 of the U.S. bankruptcy code May 25, claiming it has not been able find a buyer for its biometric technology and no longer has the liquidity to maintain its operations, pay debts or maintain its intellectual property.
A creditors’ meeting will be held June 22 for Sonavation, which has accrued millions of dollars in losses since forming in 2004, according to court documents. The debtor claims the business had no income last year and has had no income so far this year.
The Palm Beach Gardens, Fla., company owes creditors $4.3 million on assets of $3.9 million.
Among those listed as secured creditors is businessman Donald Nickelson. He has chaired the Pacific Stock Exchange, Cboe Exchange and Cross Match Technologies. He also has served as CEO of Experian North America and president of PaineWebber Group, according to business research firm Market Screener.
Another secured creditor, former Sonavation CEO Karl Weintz, reportedly is owned $2 million.
Software and hardware patents are estimated to comprise $2.5 million of the firm’s assets and the debtor has a $1.4 million against chipmaker Analog Device, possibly related to a 2019 licensing deal.
There were no employees at the time of filing and only one former worker is owed back wages. How much is owned was not listed.
The company is operating as a debtor in possession, which generally allows an ailing business to be run by its owners, although they cannot borrow new money without court approval.
Formerly known as Authorizer Technologies, Sonavation has raised $44.5 through five rounds starting in 2010 and ending in 2015. About $17 million of that money was for debt financing, according to business director Crunchbase.
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