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DanJones
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DanJones,
User Rank: Blogger
10/29/2014 | 11:39:10 PM
Re: What an extraordinary process
Haven't seen any suits yet. 

 

Of course, they need to get new product out ASAP.
jbtombes
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jbtombes,
User Rank: Light Sabre
10/29/2014 | 6:06:54 PM
Re: What an extraordinary process
I suppose Dan will let us know if any suits arise, though a cynical mind imagines legal sharks circling about, sniffing for blood - and billable hours. The new company is saying two things at once - no responsibility whatsover for the old company, while declaring to "support its broad customer base." That's disconcerting, though Exalt technology and engineering seemed sound enough a few years ago, at any rate, when I got close to it. Customers will be the proof point here.
brooks7
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brooks7,
User Rank: Light Sabre
10/29/2014 | 10:59:47 AM
Re: What an extraordinary process
"The Exalt management team bought the assets"

The CEO can say what he wants but unless Exalt Communications declared bankruptcy ahead of time there is a little thing called Fraudulent Conveyence that may come into play.  It is against the rules to bankrupt a company by pulling assets out.  The entire transaction can be reversed.  We worried about this as we bought our part of Marconi.  They had created a US subsidiary that contained all the US assets.  They took the transaction payment directly out of that company to Marconi parent to pay its debts.  So, we had to be clear that we weren't bankrupting the US entity when we did this transaction.

Now, what they may argue is that the company was "effectively bankrupt" before the transaction.  But that still can leave them open for legal action.  For example, by California Labor Law all accrued Paid Time Off MUST be paid 100% even if the company is bankrupt.  The debt actually transfers to the persons of the Board of Directors.  

My guess is the lawyers are going to have some fun.

seven
sarahthomas1011
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sarahthomas1011,
User Rank: Light Beer
10/29/2014 | 10:34:17 AM
Re: What an extraordinary process
I agree with you, Ray. It's very strange, especially given the backstory that Dan uncovered in his previous articles. I have a feeling potential customers will agree too.
Ray@LR
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[email protected],
User Rank: Blogger
10/29/2014 | 10:30:30 AM
Re: What an extraordinary process
I get that.

I just think it is a joke to say that the company that uses the same core brand name of Exalt, with the same CEO, in the same offices, in the same business, is nothing to do with the previous Exalt. It is - it is the same company reborn, with a slight change in name and a change in financial position. I'm sure it's all down to legal accountability, but still a farce, IN MY OPINION.
DanJones
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DanJones,
User Rank: Blogger
10/29/2014 | 10:24:31 AM
Re: What an extraordinary process
That's how an ABC works though. The Exalt-appointed LLC handles getting any money back to creditors. Apparently this is not too uncommon an option for heavily leveraged VC-backed companies, especially in California.
Ray@LR
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[email protected],
User Rank: Blogger
10/29/2014 | 8:48:40 AM
What an extraordinary process
"As a corporation, Exalt Wireless is not at all, in any shape or form, associated with Exalt Communications, and not responsible for anything associated with Exalt Communications."

 

So says the CEO of Exalt Wireless, who was the CEO of Exalt Communications.

Maybe it is no-one else's interest to point out what a sham this is. I wonder what the non-bank creditors think.

I'm sure this is all above board. But still... 


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