Kronos Advanced Technologies Inc.

What they do

The company developed proprietary technology for moving, filtering, and sterilizing air using corona discharge and ion exchange. It had product applications in air movement, purification, temperature management, and electronics cooling. As of the latest filing, it has terminated all employees except executives, who are also resigning, and is no longer conducting substantial operations.

Revenue drivers

• Technology licensing or sale — The company has no active product sales; its primary potential revenue source is licensing or selling its patented air technology.
• Asset liquidation — If no buyer is found, proceeds from the transfer of assets to secured creditors may be the only remaining source of value.

Recent performance

The latest 10-Q does not include revenue figures, reflecting the cessation of operations. The company defaulted on a secured convertible promissory note with AirWorks in September 2008 and is in peaceful possession proceedings. Management states that financial condition forced it to cease substantially all operating activities and initiate deregistration of its stock.

Strategy

Management is prioritizing limited resources on selling or licensing the technology or liquidating assets. It has been in discussions with secured lenders to resolve defaults and is now transferring control of assets to AirWorks and Hilltop. The company also plans to voluntarily deregister its stock with the SEC, citing fewer than 500 shareholders and assets under $10 million.

Risks

• Creditor enforcement — AirWorks issued a notice of default, and the company is transferring assets via peaceful possession procedures.
• No ongoing operations — With all employees terminated and executives resigning, the company has no revenue-generating activities.
• Inability to sell technology — The company failed to locate a purchaser for its business or assets on satisfactory terms.
• Deregistration and delisting — Deregistration removes public reporting obligations, potentially reducing transparency and liquidity for shareholders.

Outlook

Management does not provide a forward-looking outlook beyond the immediate focus on asset disposition. The company expects to complete the transfer of assets to creditors and deregister its stock, which will end its obligation to file periodic reports. Given the cessation of operations, no future revenue or profitability is projected.