by Damon Martin – MMAWeekly.com
Xyience Inc., recognized as one of the largest sponsors for the Ultimate Fighting Championship, filed for Chapter 11 bankruptcy according to reports from the Las Vegas Review Journal.
According to the report, the company reported $42.3 million in liabilities with only $5.3 million in assets, which along with claims of death threats and violence against leadership at Xyience caused the filing.
The bankruptcy petition filed was voluntary, which followed an involuntary claim made on Jan. 3 by founder and former CEO Russell Pike.
The filing under Chapter 11 provides Xyience Inc. with protection from creditors while the company reorganizes and while the situation would seem dire, current Xyience president Omer Sattar said he is optimistic about the company’s future.
“We’re excited about the opportunity (to reorganize the company), ” said Sattar in an interview with the Las Vegas Review Journal. “Xyience has a great brand name and has a strong affiliation with the UFC.”
Frank and Lorenzo Fertitta, owners of the UFC along with president Dana White, are named in the claim as creditors in the bankruptcy filing, which states that they have $12.5 million in unsecured claims and another $5.3 million in secured claims with Xyience Inc.
In the statement, Sattar said that the company may have had to file for liquidation under Chapter 7 if not for the continued support of the Fertittas during this time, and while again the current Xyience president stays optimistic, he stated that the current filing became necessary when the company was unable to raise an additional $7.5 million from current shareholders.
The filing also makes claims that former leaders and founders of Xyience have made threats of violence against current leadership for the company, claiming lost funds and payment.
Attempts to reach both UFC president Dana White or the Ferttita brothers were unsuccessful according to the report.