DigitalTown, Inc. (DGTW)

[stervc]

With the DGTW Chapter 11 BK & No Reverse Split...

With the Chapter 11 Bankruptcy filed with DGTW, we are still in its early stages. If it would have been a Chapter 7, then all would have been lost, but the language 100% indicates that the common shares will be kept intact.

Also, with the reverse split, I believe that it is not going to happen. It was supposed to had happened on Feb 16, 2020 and didn't as it was approved back on Dec 12, 2019:
https://www.otcmarkets.com/filing/html?id=13864054&guid=zH86UFsYtmfCSth

Also, no reverse split because it says that they are going to ensure that the existing shareholders retain their equity stakes.

While the company is going through a BK reorganization, they are not going to be allowed to dilute or do a reverse split. If a reverse split was going to happen, they would have to had mentioned it within the PR today wit the rest of the material events that were mentioned.

Pay particular attention to what's in bold within the PR for the language that indicates that the common shares are going to remain intact:

https://www.otcmarkets.com/stock/DGTW/news/story?e&id=1696192
DigitalTown, Inc. to Use Voluntary Chapter 11 Process to Position Business for Long-Term Success

NEW WESTMINSTER, BC, Sept. 21, 2020 (GLOBE NEWSWIRE) -- DigitalTown, Inc. (OTC: DGTW) (the “Company”) announces that the Company has filed for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Minnesota, St. Paul Division, paving the way for business continuity, profitability and sustained growth in shareholder value.

Following the announcement of a new management team in May 2019, DigitalTown began making substantial progress on their commitment of cleaning up the Company’s balance sheet and exploring opportunities that would bring value to the Company’s shareholders. DigitalTown was successful in converting over $2 million of debt into stock and structuring a go-forward plan with appropriate financing measures. The plan’s execution was conditional on negotiating a satisfactory resolution with its former CEO who had an active, previously disclosed lawsuit against the Company at that time. DigitalTown’s various negotiation efforts were unsuccessful, leading to the granting of a summary judgment motion in favor of the Company’s former CEO due to the Company’s inability to access resources to formally defend itself.

Since that time, this same party has filed another lawsuit against the Company and has made hostile threats of additional suits against the Company as well as personal suits against directors and officers, unless management resigned and turned over control of the Company to him. DigitalTown’s management has been working on a detailed plan for moving the Company forward and realizing value for shareholders and all stakeholders, and is prepared to execute on this plan after a successful reorganization. In the absence of an alternate, genuine plan for the business clearly articulated by any other party, management would have considered it a breach of its fiduciary duty to turn the Company over to anyone to simply avoid the inconvenience of threatened, specious lawsuits.

“After careful consideration of all challenges and alternatives, we firmly believe that our Chapter 11 process represents the best long-term solution for DigitalTown to address its legal and liquidity challenges and to strengthen its operations for future growth and profitability,” said Sam Ciacco, CEO and Chairman of the Board of DigitalTown.

DigitalTown's approach to leveraging the benefits of Chapter 11 allows the Company to emerge with a healthy balance sheet and reorganize its debt and fairly treating creditors, while ensuring existing shareholders retain their equity stakes. Management decided on this preferred alternative to a Chapter 7 Bankruptcy in which the positions of DigitalTown’s creditors and shareholders positions would be entirely lost. This remains a possible outcome should the Company’s plan be obstructed in some way.

DigitalTown’s board and management is appreciative of the support and endorsements received to date from so many of its stakeholders.

About DigitalTown

Founded in 1982, DigitalTown has serviced various sectors from sports to computer training to computer hardware and software. DigitalTown develops turn-key hosted solutions for economic development, civic engagement and digital inclusion platforms for both web and mobile devices, improving the quality of life for residents and visitors in cities around the world.

Contact:
Sam Ciacco
CEO
[e-mail]
425-577-7766

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