Hayes files for bankruptcy
It's strike two for the modem maker, which is filing for bankruptcy for the second time in three years.
Under Chapter 11 of the Bankruptcy Code, Hayes said it would continue to operate, while seeking to work out a reorganization plan. The petition was filed in the U.S. Bankruptcy Court for the District of Delaware.
"We made the decision to seek the protection of the Bankruptcy Court in the belief that this action would provide the most viable means of achieving our key goals of refocusing our business strategy and operations," said Ron Howard, Hayes vice chairman and CEO, in a statement.
In addition to the earlier reorganization under Chapter 11, the company has also gone through several restructurings in the last few years as it attempted to compete in an increasingly competitive market for analog modems currently dominated by 3Com's U.S. Robotics. The company has struggled to transition its products to higher margin communications equipment such as remote access servers and high-speed digital subscriber line (DSL) and cable modems.
The company once noted for technological innovation--founder Dennis C. Hayes invented the basic set of instructions all dial-up modems used to talk to each other with today--attempted a merger with competitor Boca Research before seeking protection from creditors through the U.S. bankruptcy court in 1995.
The then privately held Hayes emerged from a 17-month bankruptcy in 1996, and the company pursued a merger with motherboard-maker Micronics. After that failed, Hayes eventually completed a reverse merger with publicly held remote access player Access Beyond in December of 1997. (See related story)
The company said it has secured "interim debtor-in-possession financing for the immediate use by the company to continue operations, pay employees, and purchase goods and services going forward, while it is negotiating to secure permanent financing."