Creditors File Involuntary Chapter 11 Petition Against ORBIT BRANDS CORPORATION.LOS ANGELES Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. -- ORBIT BRANDS CORPORATION f/k/a orbitTRAVEL.com Corporation (OBTV) (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on ). ORBIT BRANDS CORPORATION announced today that on Friday, June 25, 2004, several of its creditors filed an Involuntary Chapter 11 Petition against the Company with the objective of reorganizing the Company in the United States Bankruptcy Court bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. for the Central District of California, in Los Angeles, California. The Company has issued notice of the involuntary bankruptcy involuntary bankruptcy Bankruptcy that is forced by creditors instead of being initiated by the firm or individual. Compare voluntary bankruptcy. See also Chapter 7, Chapter 11. filing to all of its shareholders and has filed an SEC Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. regarding this event with the Securities and Exchange Commission. The Petitioning Creditors expressed concern that ongoing litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. in Delaware, brought by a former employee of the Company and believed to be supported by the Company's former chief legal counsel, represents an unregistered hostile takeover Hostile Takeover A takeover attempt that is strongly resisted by the target firm. Notes: Hostile takeovers are usually bad news, as the employee moral of the target firm can quickly turn to animosity against the acquiring firm. attempt for control of a public company. These creditors have informed the Company that they believe such action places their interests in jeopardy. The Company has recently learned that the Delaware plaintiff has also threatened to file new litigation against the Company, its Chairman, its accountants and attorneys, in California, Florida, Michigan, Montana and New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . The Company expressed concern about the role of its former chief legal counsel in the Delaware litigation, as described in its most recent Form 10-KSB, filed with the Securities and Exchange Commission on June 21, 2004, and referred all further inquiries to its June 21 filing. The Petitioning Creditors and management of the Company believe the Delaware plaintiff and his supporters, including the Company's former chief legal counsel, are seeking unwarranted compensation and additional stock in the Company in order to further an unregistered hostile takeover of a public company. The Company's management stated its belief that the independent audit performed in conjunction with the Form 10-KSB offers credible evidence that the allegations made in the Delaware litigation are frivolous and wholly without merit. The Company's creditors expressed concern that management has had to devote considerable time and resources to the pending litigation and has not been able to concentrate all of its efforts on its other duties, as well as noting the financial burden of continuing to defend against nuisance claims by the same plaintiffs in several states where the Company has conducted business. The creditors also voiced their concern that the interests of both creditors and shareholders of the Company have been compromised as a result. The Petitioning Creditors believe that the filing of the involuntary proceeding will enable the Company to bring a halt to vexatious litigation A legal action or proceeding initiated maliciously and without Probable Cause by an individual who is not acting in Good Faith for the purpose of annoying or embarrassing an opponent. The U.S. and protect their interests as creditors and the interests of the shareholders of the Company, and provide the Company with the ability to advance its present business opportunities and eliminate further interference by the Delaware plaintiff and others acting in concert with him. ORBIT BRANDS CORPORATION is a publicly traded Delaware Corporation listed on the NASDAQ. The primary focus of the Company is growth via the acquisition and development of early stage high growth companies in the technology, health and fitness, and consumer goods consumer goods Any tangible commodity purchased by households to satisfy their wants and needs. Consumer goods may be durable or nondurable. Durable goods (e.g., autos, furniture, and appliances) have a significant life span, often defined as three years or more, and industries. ORBIT BRANDS CORPORATION is positioned to identify, acquire, fund and develop these companies for the purpose of creating business and shareholder value. Forward Looking Statements Statements regarding financial matters in this press release other than historical facts are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, the Securities Exchange Act of 1934, and as that term is defined in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The Company intends that such statements about the Company's future expectations, including future revenues and earnings, and all other forward- looking statements, shall be subject to the safe harbors created thereby. Since these statements (future operational results and sales) involve risks and uncertainties and are subject to change at any time, the Company's actual results may differ materially from the expected results. |
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