Australian-owned IP security surveillance maker Zylotech will enter a formal written arrangement with creditors and other parties to attempt to resolve the company's debt problems without the need for liquidation.
Known as a Deed of Company Arrangement (DOCA), it is designed to allow administrators to enact plans and strategies to guide a troubled company out of voluntary administration and provide a greater return to creditors than would be possible through liquidation.
The DOCA's instatement was decided at a creditors meeting today, according to Andrew Needham from administrators HLB Mann Judd.
Zylotech was placed into voluntary administration on 24 August.At the time administrators told CRN the company had received numerous expressions of interest for the purchase of Zylotech's business and technology assets. Recapitalisation of the company was also presented as an option.Zylotech's former CEO and founder Nick Sikiotis - also a creditor - told CRN he was "disheartened" by the outcome.
Sikiotis was forced from his position at the company in December last year. Sikiotis at the time claimed he had been "set up"."It took four months for [the new directors of the company] to go in destroy it," Sikiotis alleged to CRN in an interview today.
"No-one knew how to run a technology company."He claimed creditors, including himself, were owed "a lot of money".
Sikiotis believed creditors would eventually be paid from a pool of funds generated by the sale of the company or its assets but "nobody knows when they'll see the money or how much they'll get." The Sydney-based company - listed on the ASX - had operated for 10 years. It developed Vivotek internet-protocol cameras, Hawkeye network video recorders, video-recording security software and also offered services.Zylotech's website said it counted Qantas, RMIT, Masterfoods and the NSW Roads and Traffic Authority as customers.
Issue: 316 | July 2013
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