ON Worldwide Inc., maker of wearable digital recorder that competes with industry leader GoPro Inc., has filed for bankruptcy after seeing a significant drop in revenue last year.
Company of New Jersey has reached a restructuring support agreement with one lender, which would cut more than $ 15 million of debt from the balance sheet and enable ION to stay in business.
ION Chief Financial Officer Chris Oatway said in court documents filed last week that the company’s cash starvation has been mired with problems, including a dispute with one of the licensed brands and intellectual-property lawsuit with GoPro.
ION create a line of wearable cameras in various sizes, home-security products and dash cams, among other products, under the brand ION and Contour.
ION see a drop in revenue to $ 12.4 million in 2015 from more than $ 25 million in 2014, Mr. Oatway said in court documents. companies seek to cut costs and lay off employees, but it was not enough to stave off bankruptcy.
litigation involving the company also cut into the bottom line of this ION. the company filed a patent lawsuit against GoPro end of last year. And although the lawsuit is “the most likely of producing results,” the company will lead to high legal fees, Mr. Oatway said in court documents.
ION Contour LLC also sued earlier this year in an attempt to get out of its license agreement. The two companies have since reached an agreement which allows the ION to continue to sell products Contour, according to court documents.
ION expects to keep the business running and said in court documents that it will launch a new 4K cameras by the end of summer, which the company says will be priced to compete with the GoPro.
Sidd
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