Amp’d Mobile’s Lifeline Extended
6/22/07 – Amp’d Mobile will be allowed to use $7.5 million in cash collateral from Verizon Wireless to keep its mobile virtual network provider, or MVNO, phone service running, a U.S. Bankruptcy Court judge ruled this week.
The judge’s sign off allows Amp’d to keep the service running through June 25. The ruling requires Amp’d Mobile to set aside $2.45 million as a reserve, to be used only with Verizon’s written approval.
Verizon had originally demanded payment from Amp’d for its mobile network services on the threat of a shutdown just before Amp’d filed for chapter 11 bankruptcy. Reports indicate that Amp’d owes Verizon about $33 million.
As a result, Amp’d has filed suit against Verizon Wireless, seeking a court order that bars the company from terminating Amp’d from its network.
Reports have circulated widely of overspending at Amp’d, which had raised around $360 million in venture funding, leading up to its bankruptcy. Founder and CEO Peter Adderton left the company in the wake of the filing.
Amp’d Mobile – www.ampdmobile.com
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