Vitesse officially appointed Christopher R. Gardner as its new CEO. He had been acting in that role since April 18th, when the company placed Louis R. Tomasetta, the company’s CEO, Eugene F. Hovanec, the company’s Executive Vice President and Yatin Mody, the company’s Chief Financial Officer, on administrative leave.
Tomasetta, Hovanec, and Mody have been terminated as officers and employees of Vitesse because of their involvement with issues related to the integrity of documents relating to Vitesse’s stock option grant process.
Gardner, the new CEO, joined Vitesse in 1986. He served as Vice President and Chief Operating Officer from November 2000 to June 2002. Since June 2002 , he served as Vice President and General Manager of the Network Products Division. Mr. Gardner received his B.S.E.E. from Cornell University and his M.S.E.E. from the University of California at Berkeley.
Vitesse said its internal investigation relating to past stock option grants, the timing of such grants and other related accounting and documentation issues has been expanded to include issues relating to the company’s practices in connection with credits issued to and requested by customers (for returned products or otherwise) and the related accounting treatment, as well as the application of payments received to the proper accounts receivable. The internal investigation has now been further expanded to include a review of the company’s general revenue recognition policies and practices and practices that may have affected the company’s cash position at the end of certain reporting periods.
Furthermore, Vitesse said it has received notice from Silicon Valley Bank regarding potential default on its credit facility. The company has engaged an investment banking firm to assist in obtaining additional financing. Vitesse said that if additional financing is not obtained and/or the Bank takes further action under the credit facility, it would have a material adverse effect on Vitesse’s operations, liquidity and financial condition.
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