ATV Systems Inc., a Santa Ana maker of computerized cash registers for restaurants, told its stockholders this week that the firm had returned to profitability in its 1985 fiscal year but that a plan for foreign investors to pump $15 million into the cash-poor company had fallen through.
At the company's stockholders meeting Tuesday, its first since going public in 1983, Douglas O'Connor, ATV's president and chief executive officer, said net income was $1.3 million for the 1985 fiscal year ended March 31, a rebound from a loss of $30.6 million in the previous fiscal year.
But the company's revenues dropped sharply in fiscal 1985 to $30.8 million from $54.8 million in fiscal 1984, he said.
And O'Connor told shareholders the company is suffering from a negative net worth of $18.3 million, caused largely by ATV's early rapid growth and undercapitalization.
O'Connor said earlier this year ATV received a letter of intent from an unnamed group of foreign investors who were considering lending $15 million to the company in a deal whereby the funds would ultimately be convertible into ATV common stock.
The money would have come in handy, O'Connor said, for paying off $5 million owed to debenture holders, $2.3 million in overdue federal taxes, a $3.4-million bank loan now in default and about $2.6 million owed to creditors.
But O'Connor said the investors, after initially taking an extension, let their letter of intent expire last month. He said the investors were frightened off by a number of lawsuits involving the sale of ATV's computer maintenance business to American Express. ATV is contending that American Express paid less than the agreed-upon price and ATV's creditors, in several separate suits, claim they should have been notified of the sale and paid from the proceeds of the sale.
In yet other litigation, Triad America, one of ATV's debenture holders, is suing the company for overdue payment.