Metricom, a high-speed wireless data services company, today announced that it has filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the US Bankruptcy Court in San Jose, California. Under the protection of Chapter 11, the Company will seek to restructure its operations and debt obligations while maintaining the operation of its wireless network and continuing to provide services and access to its many resellers, channel partners, and direct customers in the 15 metropolitan markets that it currently serves. Metricom is working with its resellers and channel partners to maintain network access services for their end user subscribers.
Commenting on the announcement, Interim CEO Ralph C. Derrickson said, “As a result of the depressed state of the capital markets, we have been unable to raise necessary additional capital. Consequently, management and the Board of Directors decided this action would be in the best interests of all of Metricom’s stakeholders. Although there are certainly many challenges ahead, we believe that the prospects for our outstanding technology remain strong. We will continue to work hard to preserve the value inherent in our technology, while evaluating the options before us.”
The petition allows Metricom to continue its operations and to explore financial alternatives, while working with its creditors to restructure its debt obligations. The law firm of Murphy Sheneman Julian & Rogers has been engaged as reorganization counsel for Metricom.
The Company and its Board of Directors also announced the appointment of Kevin I. Dowd as chief restructuring officer, a newly created position. Mr. Dowd, a corporate turnaround specialist who has been serving as an outside advisor to Metricom for the last several weeks, will be overseeing the Company’s restructuring efforts, as well as working with the Company to evaluate options for financing the Company’s continuing operations, as well as other strategic alternatives.
“It is clear to me that Metricom’s wireless Internet access product is viable and that its Ricochet service offering provides the fastest mobile wireless communications solution on the market today,” said Mr. Dowd. “The Company believes that today’s filing is the best means to preserve these assets moving forward.”
Mr. Dowd is a Principal of Nightingale & Associates, LLC with more than 25 years of US and international sales, marketing, operations, administrative and general management experience. In addition to having held a variety of operating management positions in the communications, office products, computer, consumer banking and investment banking industries, he has served as interim president and chief executive officer for more than 28 companies, including an $800 million microelectronics distributor, $350 million financial services conglomerate, and a major international shipping concern.