ITXC’s Ascent

Church & Dwight:

Expansions

Name Change

Leaving Town

Deaths

Corrections or additions?

These articles by Melinda Sherwood were published in U.S. 1

Newspaper on November 3, 1999. All rights reserved.

Base Ten: Life in the Fast Lane

How’s this for a corporate turnaround? Less than two

months ago Base Ten Systems was on the verge of being de-listed by

Nasdaq because its shares had fallen below the $1 mark. The former

defense contractor turned pharmaceutical software developer was saved

by a one-for-five reverse stock split that was effective September

23.

Then last week, after months of friction between major sharesholders

and management, Base Ten’s board made a change at the top. On October

29 Thomas Gardner, the 51-year-old president and turnaround CEO,

resigned

following discussions between shareholders and the board. The new

CEO and president, Stephen Cloughley, has been in charge of the

company’s

marketing and corporate development since 1996. The new chairman,

board-member Robert Hurwitz, is the former chairman and co-founder

of Office Max Inc.

The move drove the company’s stock price up 178.6 percent to $2.44

in trading, a surge that continued on Monday, November 1, when it

closed at $4.365, and traded briefly at around the $6 mark.

Trading as BASEA, the 32-year-old company at 1 Electronics Drive made

its name doing weapons control systems and custom electronic systems

for data handling. After the fall of the Berlin Wall in 1989 it lost

its major client, the Federal Republic of Germany, and in 1991 Mike

Kranzler, the CEO, began to broaden the company’s focus to

manufacturing

execution systems and services for the international pharmaceutical

and medical devices industries.

When losses in 1997 totaled $15.5 million, Thomas E. Gardner, a

marketing

specialist who had worked for Proctor & Gamble, J&J, Simon & Schuster,

and Dun & Bradstreet, signed on as CEO and the company floated a $19

million private placement. Already well underway was a spin-off —

an employee buyout — of the defense equipment side of its

business,

to be known as Strategic Technology Systems. Base Ten was to continue

developing FDA-approved compliance systems known as "cGMP."

But the stock dropped from $10 to $6.

In November, 1998, the stock dipped below $2 and investors began to

scramble. By March, Jesse Upchurch and Drew Sycoff, who collectively

control over half of the company’s stock, called for Gardner’s

resignation,

complaining of poor management. Gardner, on the other hand, explains

his tenure in a more positive light: "Two years ago, the board

asked me to implement a transition of the company from defense

contractor

to commercial software developer of manufacturing execution systems

for cGMP regulated industries. While the strategy has taken longer

to implement and cost more in operating losses that anticipated, I

believe that company is now positioned for growth and profitability

in its new markets."

Perception is crucial, indicates Gardner’s successor, who is both

a marketing expert and chemical engineer. "There’s nothing else

material — just the CEO has changed," says Cloughley, who

received a degree in chemical engineering from University College

in his hometown of Dublin, Ireland, Class of 1981, and worked at

Simulation

Sciences in California before joining Base Ten. "There was

generally

a falling off in confidence in the company, but we now have a a

unified

management team and that’s a wonderful position to start from."

Why was Cloughly the right choice? In his words: "There’s lot

of good many managers with good sales and marketing skills and good

technical skills, but not many people with both."

Base Ten Systems Inc. (BASEA), 1 Electronics Drive,

Box 3151, Trenton 08619-3151. Stephen Cloughley, president, CEO.

609-586-7010;

fax, 609-586-1593. Home page: http://www.base10.com.

Top Of Page
ITXC’s Ascent

Just two months after going public, ITXC, a provider

of Internet-based telephone service, is keeping investors happy and

has earned a "most likely to succeed" award from the New

Jersey

Venture Association. Revenues for the quarter just ended were 20 times

last year’s third quarter revenues.

As of September 30, revenues had reached $6.6 million, up from 1998’s

$311,000. Net loss for the third quarter in 1999 was also up, climbing

to $6.3 million versus $2.3 million in 1998. Officials recently

announced

several new technological improvements that could upgrade call

connections

and enhance line capacity at hubs in New York City and Los Angeles.

Founded by AT&T expatriate Tom Evslin, and originally funded by AT&T,

ITXC started out at Evslin’s Princeton home. ITXC is now capitalized

to the tune of $33 million, and it received half of that ($15 million)

this March. Investors include Chase Capital Partners, Flatiron

Partners,

Intel, Polaris Ltd., Spectrum Equity Investors, and VocalTec

Communications,

all of whom also invested in ITXC’s first round.

ITXC: Internet Telephony Exchange Carrier, 600

College Road East, Princeton 08540. Tom Evslin, CEO. 609-419-1500;

fax, 609-419-1511. Home page: http://www.itxc.com.

Top Of Page
Church & Dwight:

Two New Brands

Church & Dwight, which purchased several products from

Dial in 1997, continues to clean up after its competitors. On the

same day that the company announced profits of $11.4 million for the

quarter ending October 1 it also announced the purchase of two new

brands — Clean Shower and Scrub Free. For the company that already

manufactures Brillo soap pads, Sno Bol toilet Bowl cleaner, Parsons

Ammonia all-purpose cleaner, and many incarnations of Arm & Hammer

baking soda, these two brands give Church & Dwight the equivalent

of a full house in the household cleaning business.

Launched in 1995 by Clean Shower LP, Clean Shower is a daily cleanser

that holds approximately eight percent share of the bathroom cleaner

market. Scrub Free, which goes back to 1976, is a much older product

that does roughly the same thing in three versions that give special

attention to soap scum, mildew, and daily cleansing. It also holds

eight percent of the market. Purchased for a $55 million, the two

brands together total about $50 million in sales per year. Robert

Davies III, president and CEO of Church & Dwight, was quoted as saying

that the acquisition doubles the company’s revenue in the bathroom

cleaner business, bringing it up to $100 million, and "provides

us with important synergies and opportunities for future growth."

Church & Dwight Co. Inc. (CHD), 469 North Harrison

Street, CN 5297, Princeton 08543-5297. Robert A. Davies III, president

and CEO. 609-683-5900; fax, 609-497-7177. Home page:

http://www.armhammer.com.

Top Of Page
Expansions

Druker, Rahl & Fein, 3625 Quakerbridge Road, Hamilton

08619. Conrad L. Druker CPA, managing partner. 609-689-9700; fax,

609-689-9720. Home page: http://www.drfcpa.com.

This accounting firm moved from 200 Canal Pointe Boulevard to a newly

renovated office at 3625 Quakerbridge Road, trading in 10,000 square

feet for 40,000 square feet. Half of the property is up for lease.

The phone and fax numbers are new.

Top Of Page
Name Change

First Union Securities, 989 Lenox Drive, Building

1, Suite 200, Lawrenceville 08648. Brian McGrath, vice president.

609-896-0200; fax, 609-896-0714. Http://www.wheatfirst.com.

This investment advisory firm, headquartered in Richmond, Virginia,

changed its name from Wheat First Butcher Singer. Phone and fax remain

the same, and the website has not yet been changed.

Top Of Page
Leaving Town

Capital Planning Advisory Group, 711 Executive

Drive, Princeton. George Luciani, president. 609-497-7500.

George N. Luciani packed up his financial planning office in

Montgomery

Commons but is still serving clients from an office in Yardley. The

phone number above is still active.

Top Of Page
Deaths

Robert E. West , 73, on October 16. He co-founded Wiss,

Janny, Elstner, a forensic engineering firm at 14 Washington Road.

John E. (Eddie) Thorpe Sr. , 42, on October 23. He had

worked with William Sword and Son and operated J.E.T. Carpentry.

Frank D. Tenne , 50, on October 30. He was director of

United States Field Research and Development at American Cyanamid

Co. on Route 1.

Lester F. Soyka , 68, on October 28. He was a retired vice

president of clinical pharmacology at Bristol-Myers Squibb.

Joseph E. McGowan , 74, on October 28. He was on the technical

staff at the Sarnoff Center.

Clementine Christina Wintle , 76, on October 29. She was

president of DeLuxe Travel Bureau on Nassau Street.


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