SARASOTA, Fla., April 6, 2016 /PRNewswire/ -- xG Technology, Inc. ("xG" or "the Company") (Nasdaq: XGTI, XGTIW), a leader in providing critical wireless communications for use in challenging operating environments, announced that, effective today, it has implemented cost reduction initiatives that are expected to result in a decrease in xG's overall monthly operating expenses to approximately $500,000 on the xMax brand — a reduction in monthly cash burn of approximately $300,000.
The savings will be realized through a combination of voluntary severance, a reduction in the full-time and part-time workforce, the elimination of certain contractors, transitioning other employees to non-cash compensation arrangements, and other reductions in expenses. Additional reductions will be derived from synergies identified as a result of the acquisition of Integrated Microwave Technologies (IMT), which was finalized on January 29, 2016. The new cost structure will support the Company's ability to execute on the growth objectives for its xMax and IMT brands.
George Schmitt, CEO and Board Chairman of xG Technology, said, "The decision to reduce our workforce is a painful but necessary one we must take in order to right-size our cost structure, and these cost-cutting initiatives will provide a significant decrease in the monthly cash burn in our xMax business of approximately $300,000 from current levels. To the extent possible, we will endeavor to reassign xG staff to positions of similar responsibility with our recently-acquired IMT business, which is in a growth phase and remains self-sufficient in its operations. We have already begun obtaining efficiencies from the combined operations of xG and IMT by integrating functions including RF engineering, board design and layout, and services, and this process is expected to accelerate."
Mr. Schmitt continued, "We are confident that, notwithstanding these announced reductions, we will able to preserve our core engineering, operational and sales teams and competencies without disruption, and that will allow us to execute on the numerous growth opportunities we are pursuing in military, public safety and other markets. We will continue to aggressively drive near-term revenue-generating engagements, both for our xMax mobile broadband communications solution, as well for advanced video system solutions from our IMT business. We expect to re-evaluate and respond to the need for additional resources as our business requirements dictate. Finally, we would like to express our sincere appreciation to our affected employees for their contributions to xG Technology."
About xG Technology, Inc.
Founded in 2002, xG Technology has developed communication technologies that make wireless networks more intelligent, accessible, affordable and reliable. The company's technology brand portfolio includes xMax and Integrated Microwave Technologies (IMT). xMax is a patented all-IP cognitive radio network system that enables secure, robust mobile broadband communications for private, consumer and government networks. xMax can solve the crisis facing the wireless industry caused by data-hungry devices and applications that are straining network capacity. It eliminates the need to acquire scarce and expensive licensed spectrum, thus lowering the total cost of ownership for wireless broadband access. xMax delivers always-available voice, video and data services and is interoperable with existing cellular and dedicated networks without being dependent on them. xMax incorporates advanced optimizing technologies that include spectrum sharing, interference mitigation, multiple-input multiple-output (MIMO) and software defined radio (SDR). xMax is ideal for wide area, as well as rapid emergency communication deployment in unpredictable environments and during fluid situations. xG offers solutions for numerous industries worldwide, including emergency response and public safety, military, telemedicine, urban and rural wireless broadband, utilities, and critical infrastructure.
IMT is a leader in advanced digital microwave systems and a provider of engineering, integration, installation and commissioning services serving the Broadcast, Sports & Entertainment and MAG (Military, Aerospace & Government) markets. IMT's product lines include digital broadcast microwave video systems, compact microwave video equipment for licensed and license-free sports and entertainment applications, and mission-critical wireless video solutions designed for use by state, local and federal police departments. More information on IMT can be found at www.imt-solutions.com.
Based in Sarasota, Florida, xG has over 100 patents and pending patent applications. xG is a publicly traded company listed on the NASDAQ Capital Market (symbol: XGTI) For more information, please visit www.xgtechnology.com.
Cautionary Statement Regarding Forward Looking Statements
Statements contained herein that are not based upon current or historical fact are forward-looking in nature and constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements reflect the Company's expectations about its future operating results, performance and opportunities that involve substantial risks and uncertainties. These statements include but are not limited to statements regarding the intended terms of the offering, closing of the offering and use of any proceeds from the offering. When used herein, the words "anticipate," "believe," "estimate," "upcoming," "plan," "target", "intend" and "expect" and similar expressions, as they relate to xG Technology, Inc., its subsidiaries, or its management, are intended to identify such forward-looking statements. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause the Company's actual results, performance, prospects, and opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.
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SOURCE xG Technology, Inc.