Suit Arises From KIT digital's Acquisition of Hyro Limited
NEW YORK, NY--(Marketwired - Feb 9, 2014) - Piksel, Inc., (the "Company"), a global provider of digital television and media solutions, announced that it has commenced legal action against Invigor Group Limited (ASX: IVO) ("Invigor"), formerly known as Hyro Limited.
In June of 2012 Piksel's predecessor company, KIT digital, Inc. acquired substantially all of the assets of Invigor in exchange for $2 million cash and shares of KIT digital, Inc. valued at approximately $15 million. The shares issued to Invigor as consideration were subject to a "Top-Off" provision.
The lawsuit filed by Piksel accuses Invigor of making fraudulent, negligent, and misleading representations regarding its customer relationships, its business outlook, and its cash tax liabilities. Piksel's suit seeks disallowance of Invigor's Top-Off claim, cash damages, and recovery of Piksel's attorney's fees. The suit is an amendment to litigation previously commenced in KIT digital, Inc.'s reorganization case in the US Bankruptcy Court for the Southern District of New York, where Invigor's Top-Off claim was previously subordinated to the claims of general creditors.
"Invigor claimed it was selling a $25 million revenue business with happy customers. Invigor also claimed it had no outstanding tax obligations," said Allan Dunn, Chief Operating Officer of Piksel. "In truth, Invigor was a business less than half that size and it was losing customers at a very rapid rate. Invigor also had significant undisclosed tax obligations in Australia and New Zealand."
This suit is a result of a review of all partnerships and agreements by Piksel's new leadership team.
"As a listed company in Australia, Invigor continues to make public statements that it expects to receive warrants to purchase 8% of the outstanding shares of Piksel. We feel very strongly that when presented at trial, the facts will demonstrate that Invigor made significant fraudulent and negligent representations. As such, pending resolution of the litigation, Piksel will not issue any warrants to Invigor; on the contrary, Piksel is seeking to recover damages from Invigor," said Fabrice Hamaide, Chief Financial Officer of the Company.
A complete copy of the complaint is available on www.americanlegalclaims.com/kdi.
We help the world's leading brands maximize their reach and return with video.
Comprised of a global team of experts we call 'televisionaries', Piksel has helped to design, build, and manage online video services for major media companies like AT&T, BSkyB, Celcom, Mediaset, Sky Deutschland and Televisa, as well as enterprise brands like Airbus, Barnes & Noble, and Volkswagen.
Headquartered in New York City, Piksel (formerly KIT digital, Inc.) offices can be found throughout Europe and the Americas, serving more than 1,600 clients in over 50 countries.
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