Company
News
SyQuest Technology Signs Definitive Agreement with Iomega for the Sale
of Select Assets; Agreement Includes Sale of All Intellectual Property and U.S. Inventory
FREMONT, Calif., January 13, 1999 — SyQuest Technology, Inc.
(NASDAQ: SYQT) announced today that it has entered into a definitive agreement with Iomega
Corporation (NYSE: IOM) to sell certain assets including all of its intellectual property,
its U.S. inventory and its U.S. fixed assets for $9.5 million in cash, subject to certain
closing conditions and adjustments. SyQuest filed a motion on January 12 in the United
States Bankruptcy Court to seek approval for the sale of these assets to Iomega. Specific
conditions to closing the asset sale include Iomega's acquisition of the inventory and
equipment assets of SyQuest's Malaysian subsidiary for additional consideration.
"We have reviewed the Iomega offer and alternative offers closely. SyQuest's
accounts receivable and claims for tax and other refunds are being retained by SyQuest to
provide further value to our creditors beyond the cash offer to be paid by Iomega,"
SyQuest commented. "To best serve our loyal installed base of users, we have been
working diligently to negotiate the best possible agreement that would address their
needs." The proposed sale of assets is not likely to provide any return to
shareholders.
As previously announced, SyQuest has commenced limited sales and support operations.
This includes online technical support via the World Wide Web, warranty returns, and
product service operations. The company anticipates adding additional customer service and
technical support resources in the near future.
The United States Bankruptcy Court scheduled a hearing for January 19, 1999, to
establish sale procedures in connection with the proposed sale of assets, including
provisions for considering alternative purchase proposals.
SyQuest filed a Chapter 11 petition with the United States Bankruptcy Court in Oakland,
California on November 17, 1998. Trading in SyQuest stock was suspended on November 2,
1998, and the Company's shares are likely to be delisted from NASDAQ in the very near
future.
This news release contains forward-looking
statements that involve risks and uncertainties, and other risks detailed from time to
time in the SEC reports filed by SyQuest including its most recent reports on Forms 8K,
10K and 10Q.
|
