In addition to the class action lawsuit against UniTek concerning the restatement of UniTek’s financials and purported “fraudulent activities that resulted in improper revenue recognition,“ the Company is now facing pressure from one of its business partners. In a press release from last week, UniTek disclosed in relevant part that:
[I]ts subsidiary, DirectSat USA, LLC, has received a letter from DIRECTV, LLC providing 180-day notice of the termination of its master services agreement with DirectSat, effective November 8, 2013. Shortly following receipt of the notice, DirectSat entered into an agreement with DIRECTV providing that the 180-day notice of termination will be automatically withdrawn upon the Company’s refinancing, by July 31, 2013, of its debt on terms that satisfy certain financial requirements, the continued work on completion of its financial statements and the satisfaction of other conditions.
DIRECTV has informed the Company that it intends to continue working with the Company as UniTek addresses the issues it currently faces related to the previously disclosed accounting matters.