Globecomm Negotiates $4 Million Payment From Troubled Customer
Globecomm Systems Inc. [GCOM], a global provider of end-to-end, satellite-based communications solutions, reached a $4 million settlement with an unnamed “major customer,” and it has received initial payments of $3.5 million.
Globecomm announced a $4.5 million charge on Sept. 15, 2003, for the company’s fourth-quarter fiscal 2003 earnings, after this major customer was unable to fulfill its contract terms. The customer fell behind in its payments due to substantial delays in receiving outside financing, company officials said.
David Hershberg, Globecomm’s chairman and CEO, said in a written statement, “We are pleased to have arrived at a settlement that strengthens the balance sheet of Globecomm, while enabling this customer to continue their business as a going concern.”
The customer recently closed certain financing arrangements, and both parties agreed on a settlement of $4 million, including $2.5 million to resolve certain amounts reflected in the 2003 charge. The remaining $1.5 million settles an additional $1.1 million account receivable due to Globecomm that was not subject to the charge. An additional $400,000 will be paid by the customer to complete the previous transaction between the two companies.