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Network Equipment Technologies Announces Follow-On Restructuring Actions Along With Retirement of CEO and Appointment of Acting CEO
FREMONT, CA, Mar 29, 2012 (MARKETWIRE via COMTEX) --
Network Equipment Technologies, Inc. ("NET") (NASDAQ: NWK), a
leading provider of enterprise-class networking solutions optimized
for secure real-time communications, announced today that Nicholas
Keating has retired as President and CEO. The company's Board of
Directors has named David Wagenseller, currently CFO, to serve as
acting President and CEO. Karen Carte, currently Vice President and
Chief Accounting Officer, will assume responsibilities as acting CFO
in addition to her current duties. The actions will be effective
April 2, 2012. Keating will remain on the Board and will provide
advisory consulting services to the company.
Under a broad restructuring plan announced on January 5, 2012, the
company has been seeking to reduce expenses in order to preserve
capital resources and accelerate a return to break-even operations.
This effort has included targeted reductions in the company's global
workforce, including the elimination of 40 positions earlier in the
current quarter. Together with additional actions taken presently,
the company's headcount has been reduced by approximately 90
employees as compared to the beginning of the year, which is beyond
the initial reduction target established in January. As a result, the
company currently estimates that it will incur restructuring charges
during the quarter for severance and termination benefits of up to
$1.6 million. In addition to the restructuring plan, the company
continues to explore alternatives such as strategic transactions or
otherwise adding to its capital resources.
"We believe in the future of our new products that address the
growing markets for unified communications (UC) and enterprise
session border controllers (eSBC)," said Wagenseller. "We have been
adding new customers and our enterprise business has been growing.
Right now, though, the highest priority is to reduce our cash burn.
As a result, we have taken actions to aggressively pare expenses,
with the goal of achieving cash flow break-even against current
revenue levels. Some of our current cost reduction actions will
involve cash outlays continuing into the early part of the new fiscal
year, but we are aiming to be cash-flow break-even in our second
quarter. In reducing costs, we have sought to make targeted cuts that
will preserve our ability to provide additional product features for
the UC and eSBC markets and deliver on sales opportunities. The
current actions are also a further step in transforming the company
and bringing greater focus to the markets that have the largest
growth potential."
"On behalf of the company, I want to thank Nick Keating for his
leadership of NET over the last seven years," said Dixon Doll,
Chairman of the Board. "He provided the guidance and direction the
company needed to reestablish a competitive entry position in the
enterprise networking market while sustaining the Federal business."
Keating responded, "It has been an honor to have led such a dedicated
group of employees during my time at NET." Doll continued, "I believe
that NET has a tremendous opportunity in the exciting unified
communications market and that David Wagenseller is the right person
to lead NET through this current transition period."
About Network Equipment Technologies, Inc.
Network Equipment
Technologies, Inc. (NET) delivers high performance networking
equipment optimized for real-time communications. For more than a
quarter of a century, NET has delivered solutions for multi-service
networks requiring high degrees of versatility, security and
performance. Today, the company is focused on providing secure
real-time communications for unified communications (UC), SIP
trunking, enterprise mobility, and IP-based multi-service networking.
NET is headquartered in Fremont, CA and has 14 offices worldwide
including the U.S., the U.K., France, the Middle East, China, Japan,
Australia, and Latin America. The company sells its solutions to
enterprise and government customers through a direct sales force and
an international network of resellers and distributors.
Forward Looking Statements
This press release contains
forward-looking statements, including statements about expense
levels, anticipated restructuring charges, cash flows, market
opportunities, and other statements relating to possible future
operating results, within the meaning of the safe harbor provisions
of Section 21E of the Securities Exchange Act of 1934. Investors are
cautioned that such statements are based on current expectations,
forecasts and assumptions that involve risks and uncertainty that may
cause actual results to differ materially from those expressed or
implied in the forward-looking statements. Factors that could affect
such results include our ability to achieve broader market acceptance
for our products, and the inherent difficulties of managing required
functions with reduced staffing including the potential need to
replace certain skills or capabilities. Network Equipment
Technologies disclaims any intention or obligation to update or
revise any forward looking statements, whether as a result of new
information, future events or otherwise.
Company Contact:
Network Equipment Technologies, Inc.
Leigh Salvo
Tel: +1.510.693.5238
Email Contact
SOURCE: Network Equipment Technologies
http://www2.marketwire.com/mw/emailprcntct?id=FC046AADB479EDF1
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