Xybernaut Corp.'s former chief financial officer has agreed to rejoin a team of executives attempting to turn around the troubled Fairfax company.
John F. Moynahan left the wearable-computer maker in 2003 after almost a decade with the firm. He helped Xybernaut conduct a public stock offering in 1996, but he said that toward the end of his tenure he grew disappointed with the company's progress and the conduct of its executives.
"In the early days, it was a company of practical visionaries. We could see where the world was going and we were excited about getting us there," Moynahan said. "That's the key thing that brought me back -- being able to pick up that vision and execute."
Xybernaut has been operating in turmoil since April, when the company disclosed that its audit committee was investigating the actions of Edward G. and Steven A. Newman, the brothers who served as chief executive and president.
The following month, the Newman brothers were forced to resign when the audit committee concluded that they used company funds for personal expenses, hired family members despite an anti-nepotism policy and impeded the committee's investigation. The company's unraveling continued as its stock was delisted from the Nasdaq index, its auditor, Grant Thornton LLP, resigned, and the Securities and Exchange Commission and U.S. attorney's office began investigations.
In July the 15-year-old company filed for Chapter 11 bankruptcy protection.
Perry L. Nolen, who took over as chief executive in April, said the company's executives and directors considered several options for Xybernaut's future and ultimately decided to try to restructure the firm, which now has about 30 employees.
"We're going to clearly define the business and we're going to gain our reputation back as a leader in the mobile solutions marketplace," Nolen said.
Last month the company said it landed a $5 million "debtor-in-possession" loan to fund its operations through bankruptcy and help it sell some of its intellectual property.
Nolen said he recruited Moynahan back to the company because he wanted a chief financial officer who could, "come in and help me get a jump start knowing the industry and market that we're dealing with."
After leaving Xybernaut, Moynahan served as the chief financial officer of CardSystems Solutions Inc., a Chantilly electronic payment processing firm.