Cyphermint Sold To C.A. Acquisition
After two rounds of sealed bids, U.S. Bankruptcy Court Judge Joel B. Rosenthal approved the sale of Cyphermint Inc., a Marlborough-based, mobile payment system maker, to C.A. Acquisition Corp., which has been running the company for the last few weeks for the bankruptcy trustee.
The winning bid was for $161,000 with another $150,000 paid out over two years and an agreement to cover the "shortfall," or the company's expenses not covered by incoming revenue. In U.S. Bankruptcy Court in Worcester Monday, C.A. Acquisition told the court that the shortfall is approximately $124,000.
The second highest bid was from Cyphermint customer Afric Xpress Services Inc. of Ghana, which offered $270,000, less any shortfall.
The third place bidder was Logic Solutions Inc. of Michigan, a web site developer and IT staffing agency that helps companies make their products in China. It offered $165,000, no earn-out payments and would cover a shortfall up to $100,000.
A second round of sealed bids followed after Afric Xpress submitted a second bid raising their offer to $100,000 from $25,000 for access to the source code for the product that Cyphermint was creating for them.
Attorneys for Afric Xpress also objected to the sale and the sale procedures, claiming that C.A. Acquisition had negotiated with them in bad faith before the bankruptcy proceedings began and during the time it had been running Cyphermint, but Judge Rosenthal said that no documentation had been submitted to prove bad faith on anyone's part.
A motion to dismiss the bankruptcy case brought by Russian investors was also denied. The investors claimed that Sheffield Corp., one of three creditors that brought an involuntary liquidation petition against Cyphermint, was not a valid petitioner. The petition also brought up that John Harrington III, who signed the original involuntary petition for Sheffield is also a principal in the C.A. Acquisition Corp.
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