KIT digital Announces Final Phase of Restructuring
Only the non-operating parent holding company, KIT digital, Inc., will commence a chapter 11 case to effectuate the proposed restructuring. It is anticipated that the chapter 11 filing will occur by April 24, 2013. KIT digital's already profitable operating subsidiaries, including Ioko 365, Polymedia, Kewego, Multicast and Megahertz will not be impacted.
KIT has taken this action, with the support of its Independent Special Committee of the Board of Directors. William V. Russell, Non-executive Chairman of the Board of Directors, added, "We are pleased to announce this comprehensive solution that will provide KIT with relief from the financial, legal, and regulatory issues currently encumbering it. The Plan allows all shareholders the opportunity to participate in the future growth of the Company and at the same time it will complete the Company's restructuring by strengthening the balance sheet and positioning it for profitable growth."
"The Plan provides certainty and comfort to our customers and employees and it will allow the reorganized company to aggressively pursue growth opportunities with confidence," said Peter Heiland, Interim Chief Executive Officer and Plan Sponsor Group member. "By moving the core businesses forward together unburdened by the issues currently plaguing the corporate parent, our customers and products can once again become the sole focus of this exciting business."
Additionally, the Company has entered into a forbearance agreement with its secured lenders, which provides that the secured lenders will not exercise any remedies against the Company through April 23, 2013, while the Company completes the necessary Plan documents.
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