UPDATE: marchFIRST Outlines Chapter 11 Plan
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In a move that has an anticlimatic ring to it, with respect to its widely known first and only year of existence, marchFIRST, Inc. (Nasdaq: MRCH) formally announced that it along with its domestic subsidiaries and affiliates filed for relief under Chapter 11 of the Federal Bankruptcy Code.
The plan will provide for distribution of any cash proceeds received by the company to creditors and, if creditors have been fully paid, to holders of the company's preferred stock and then holders of its common stock.
However, at this time it is unlikely that any proceeds will remain for distribution to holders of the company's common stock, as stated in a news release.
marchFIRST also said that it did not intend to file with the Securities and Exchange Commission its annual report on form 10-K for the year ended on December 31 and that it believed that its stock would be delisted from the Nasdaq market.
The Company intends to work closely with creditors to recover on all available assets and maximize their value. The Company's European business units were not included as part of the Chapter 11 filing.
This announcement follows a tumultuous month for the company, which included a stock trading halt yesterday as well as a previous trading halt on March 28th, both connected to its troubled finances.
The Company also provided details on the following recent transactions:
The Company also announced today that following the receipt of anti-trust approval, it completed the sale of its SAP practice, VAR business and other assets, (including its interest in BlueVector) to Divine, inc.
The purchase price for these business units and assets was $6.25 million at closing, an additional $29.75 million note payable over not more than five years and up to an additional $16 million payable over five years which is contingent on the units' future performance.
The Company previously completed an initial transaction with divine, selling divine its Central Region business unit in exchange for $6.25 million at closing, an additional $27.75 million note payable over not more than five years, and up to an additional $39 million payable over five years which is contingent on the units' future performance.
The Company has also completed the sale of certain other business units, including McKinney & Silver, Inc. and the Company's Salt Lake City office. The aggregate purchase price for these business units was approximately $13.6 million and the assumption of liabilities of approximately $17.0 million.
The Company continues to be in active discussions for the sale of other domestic and foreign business units. The European business units are currently expected to continue to operate in the ordinary course of business.