All this story, plus the "Finland's PM blames Apple" mindset (which I don't think he was specifically doing) are making me think that "It's all Apple's fault" is the new "It's all Bush's fault"
LOL
With the significant difference that it isn'tall Apple's fault...
August 26th - GTAT CEO says company is in GREAT shape. He said company has a STRONG BALANCE sheet with $400M in cash and only $300M in liabilities. He said they expect to have $330M in cash by the end of year. He said by 2016 they would be making BILLIONS in profits and TENS of MILLIONS in 2014 and 2015.
Then six weeks later they are BANKRUPT. Without any warning to shareholders.
If you don't think thats an SEC violation than I have some under water land to sell you. You don't go from being a SUPER STRONG company to BANKRUPT in 6 weeks.
Curious, are you a stock holder? Trying to determine why the high level of anger on all of the posts. (Really curious)
Guys, these folks ARE insiders! Their sales of stock are public knowledge and those sales should force a shareholder to consider this in their investing.
It is fully in their right to sell stock if things look like they are going south. Tell me that you would not have done the same for $10mil.
Other shareholders could have sold the SAME time as the insider and no harm would have come to most of their money.
The problem is knowing which insider trades are actually a sign of a bad company and which trades are simply insiders "taking cash out to diversify".
The GT analysts never said anything negative about these share sales that I am aware of, but I could have missed something.
I would guess that a lot of folks commenting here don't actually know all the laws, including myself. These events were shady yes... But criminal? i doubt it.
Criminal would have been if the CEO told his non-employee friend (like martha stewart) to sell off stock and did not tell the rest of shareholders.
If the contract was "oppressive and burdensome", why the hell did they agree to the deal? I think it's safe to assume they had lawyers to advise them.
More importantly Apple should not have been surprised by the bankruptcy filing. GTAT should have been trying to renegotiate with Apple in good faith. Apple wouldn't be bound to do that, but it would have been in their best interest to keep the plant and progress going at this point. If Apple really didn't get the opportunity to help with some relief, that will not look very good for GTAT.
If you don't think thats an SEC violation than I have some under water land to sell you. You don't go from being a SUPER STRONG company to BANKRUPT in 6 weeks.
Sure you do, if you miss your liferaft in cashflow. The purpose of bankruptcy protection is to allow a company to continue operation when its cashflow and balance sheet have a problem, but the underlying business model and prospects are solid.
Again, these dates do not add up, now they are making claims that apple held back paying in May, if that happen then GTAT had cooked the book in their August disclosure which would open them to the SEC coming after all of them at the company. Again the sale by exec may have normal plan sales of stock option (RCU) no exec today can not just decide to sell one day without full disclosure. This article is making it sound like these guys just sold without the required disclosure. I have not see any information showing these guys did not disclose ahead of time.
August 26th - GTAT CEO says company is in GREAT shape. He said company has a STRONG BALANCE sheet with $400M in cash and only $300M in liabilities. He said they expect to have $330M in cash by the end of year. He said by 2016 they would be making BILLIONS in profits and TENS of MILLIONS in 2014 and 2015.
Then six weeks later they are BANKRUPT. Without any warning to shareholders.
If you don't think thats an SEC violation than I have some under water land to sell you. You don't go from being a SUPER STRONG company to BANKRUPT in 6 weeks.
I, for one, am just happy SOG is back on our side. It was getting tiresome scrolling past all those Apple-screwed-GTAT-and-therefore-must-pay-me-back-the-money-I-lost-speculating-on-it posts. Praise the lord, goodness, those were tiresome!
I don't understand the scandal here. If I work at my company and I see it tanking, I'm going to sell my stock before it's worth nothing.
Not if you're a 10% owner or principal officer, you're not. Those two statuses qualify you as an insider, and you have certain restrictions on the sale of your shares. The question here is, are these guys covered in the way they disposed of their shares, or can they be considered to have done something illegal in that disposal. This is one of the facts the future will likely yield. BTW, certain non-executive employees, at certain times, may also be prohibited from trading in their company's shares, such as just before release of big news that they are either privy to or reasonably could be considered privy to based upon their position in the company. I was locked up many times during my career as both non-executive employee and, later, as a principal officer, of the technology start-ups I worked for and co-founded in my career.
Sog, with all due respect, it's not foolish to wait for actual facts to come to light before making final conclusions. It never is. They may be crooks or frauds, but that hasn't been proven. Or, maybe they just fucked up and the reason is incompetence, not malice. What's foolish is being so confident about labels without knowing the facts.
Not like it matters, whether you give them the benefit of the doubt or not will not affect anyone.
With all due respect, the facts stated in this article (assuming they are correct) state that an executive of the company sold shares AFTER Apple withheld a payment and before shareholders knew of this damning information. What that means is these executives traded with insider knowledge of the state of the company which makes it illegal. Thus, they are crooks and frauds. They were maintaining a shield of success up until declaring bankruptcy. The only reason they would have done this is either a) they had already announced their intentions to sell stock and this was a very "fortune" time to sell or more likely b) these rats were jumping ship before it sank.
My belief is that GTA is going to try to pin this on Apple as they were not allowed to tell their shareholders that the ship was sinking, but they had to sell anyway, blah, blah, blah. Either way, they are slimy bastards who should have never gotten into bed with Apple if they couldn't produce.
Ahem ... helloooo I and many lost money while these a-holes were using inside information to cash out. Come on someone cuff them!
Yeah, they made money, but that is not the cause of the failure I suspect, it is a separate event.
I bet they way they handled the contract might be up for a review for sure, which would affect stock price, but seeing them cuffed won't actually make shareholders any happier. It's a shame that they can't be made to revert the transactions and the money split between holders, now that would make people very happy indeed.
Whether or not there is any action by the SEC, there will certainly be class action shareholder lawsuits against GTAT's executives. They had better save some of their stock sale proceeds for attorney fees, unless their strategy is to spend it all on sex, drugs, and rock and roll and then file personal bankruptcy.
The problem is, even if they knew in May that things were going sour with Apple, if theirs was part of a pre-planned, programmed sale (and done by a third party), there's probably not much the court can do. The courts could try and go after them for fraudulent conveyance, but that is very difficult to prove, unless it was obvious that they knew this was heading south at the time the stock sales were planned.
As I've said elsewhere, the defining principle that courts use is the so-called 'business judgment rule', which gives a lot of the benefit of doubt to senior execs in the Anglo-American governance system. Why do you think, for instance, very few bankers have been found guilty despite the devastating financial crisis recently?
It'll be interesting to see how this case develops.
Excellent post, to which I'll add only this. GTAT's view of how well, or poorly, things were going at each step of the process, had better synch up with the records and recollections within the halls of Apple. In any investigation associated with these executive stock sales, Apple's version of events will certainly be brought before the court. Let the games begin. This could be quite fun to follow.
This Teabagger congress? GTAT screwed Apple and managed to transfer millions of dollars from the poor (well, poorer) to the rich. They'd probably give these guys the Medal of Freedom.
This Teabagger congress? GTAT screwed Apple and managed to transfer millions of dollars from the poor (well, poorer) to the rich. They'd probably give these guys the Medal of Freedom.
Okay, yeah, this is why we have PO: so that nonsense can be kept where it belongs.
This Teabagger congress? GTAT screwed Apple and managed to transfer millions of dollars from the poor (well, poorer) to the rich. They'd probably give these guys the Medal of Freedom.
Okay, yeah, this is why we have PO: so that nonsense can be kept where it belongs.
Oh, that's not .0001% of how I feel about those fuckers. You really don't want to hear my real opinion.
Comments
All this story, plus the "Finland's PM blames Apple" mindset (which I don't think he was specifically doing) are making me think that "It's all Apple's fault" is the new "It's all Bush's fault"
LOL
With the significant difference that it isn't all Apple's fault...
The facts ALREADY say its FRAUD:
August 26th - GTAT CEO says company is in GREAT shape. He said company has a STRONG BALANCE sheet with $400M in cash and only $300M in liabilities. He said they expect to have $330M in cash by the end of year. He said by 2016 they would be making BILLIONS in profits and TENS of MILLIONS in 2014 and 2015.
Then six weeks later they are BANKRUPT. Without any warning to shareholders.
If you don't think thats an SEC violation than I have some under water land to sell you. You don't go from being a SUPER STRONG company to BANKRUPT in 6 weeks.
Curious, are you a stock holder? Trying to determine why the high level of anger on all of the posts. (Really curious)
It is fully in their right to sell stock if things look like they are going south. Tell me that you would not have done the same for $10mil.
Other shareholders could have sold the SAME time as the insider and no harm would have come to most of their money.
The problem is knowing which insider trades are actually a sign of a bad company and which trades are simply insiders "taking cash out to diversify".
The GT analysts never said anything negative about these share sales that I am aware of, but I could have missed something.
I would guess that a lot of folks commenting here don't actually know all the laws, including myself. These events were shady yes... But criminal? i doubt it.
Criminal would have been if the CEO told his non-employee friend (like martha stewart) to sell off stock and did not tell the rest of shareholders.
If the contract was "oppressive and burdensome", why the hell did they agree to the deal? I think it's safe to assume they had lawyers to advise them.
More importantly Apple should not have been surprised by the bankruptcy filing. GTAT should have been trying to renegotiate with Apple in good faith. Apple wouldn't be bound to do that, but it would have been in their best interest to keep the plant and progress going at this point. If Apple really didn't get the opportunity to help with some relief, that will not look very good for GTAT.
Sure you do, if you miss your liferaft in cashflow. The purpose of bankruptcy protection is to allow a company to continue operation when its cashflow and balance sheet have a problem, but the underlying business model and prospects are solid.
Again, these dates do not add up, now they are making claims that apple held back paying in May, if that happen then GTAT had cooked the book in their August disclosure which would open them to the SEC coming after all of them at the company. Again the sale by exec may have normal plan sales of stock option (RCU) no exec today can not just decide to sell one day without full disclosure. This article is making it sound like these guys just sold without the required disclosure. I have not see any information showing these guys did not disclose ahead of time.
The facts ALREADY say its FRAUD:
August 26th - GTAT CEO says company is in GREAT shape. He said company has a STRONG BALANCE sheet with $400M in cash and only $300M in liabilities. He said they expect to have $330M in cash by the end of year. He said by 2016 they would be making BILLIONS in profits and TENS of MILLIONS in 2014 and 2015.
Then six weeks later they are BANKRUPT. Without any warning to shareholders.
If you don't think thats an SEC violation than I have some under water land to sell you. You don't go from being a SUPER STRONG company to BANKRUPT in 6 weeks.
I, for one, am just happy SOG is back on our side. It was getting tiresome scrolling past all those Apple-screwed-GTAT-and-therefore-must-pay-me-back-the-money-I-lost-speculating-on-it posts. Praise the lord, goodness, those were tiresome!
I don't understand the scandal here. If I work at my company and I see it tanking, I'm going to sell my stock before it's worth nothing.
Not if you're a 10% owner or principal officer, you're not. Those two statuses qualify you as an insider, and you have certain restrictions on the sale of your shares. The question here is, are these guys covered in the way they disposed of their shares, or can they be considered to have done something illegal in that disposal. This is one of the facts the future will likely yield. BTW, certain non-executive employees, at certain times, may also be prohibited from trading in their company's shares, such as just before release of big news that they are either privy to or reasonably could be considered privy to based upon their position in the company. I was locked up many times during my career as both non-executive employee and, later, as a principal officer, of the technology start-ups I worked for and co-founded in my career.
Sog, with all due respect, it's not foolish to wait for actual facts to come to light before making final conclusions. It never is. They may be crooks or frauds, but that hasn't been proven. Or, maybe they just fucked up and the reason is incompetence, not malice. What's foolish is being so confident about labels without knowing the facts.
Not like it matters, whether you give them the benefit of the doubt or not will not affect anyone.
With all due respect, the facts stated in this article (assuming they are correct) state that an executive of the company sold shares AFTER Apple withheld a payment and before shareholders knew of this damning information. What that means is these executives traded with insider knowledge of the state of the company which makes it illegal. Thus, they are crooks and frauds. They were maintaining a shield of success up until declaring bankruptcy. The only reason they would have done this is either a) they had already announced their intentions to sell stock and this was a very "fortune" time to sell or more likely b) these rats were jumping ship before it sank.
My belief is that GTA is going to try to pin this on Apple as they were not allowed to tell their shareholders that the ship was sinking, but they had to sell anyway, blah, blah, blah. Either way, they are slimy bastards who should have never gotten into bed with Apple if they couldn't produce.
Ahem ... helloooo I and many lost money while these a-holes were using inside information to cash out. Come on someone cuff them!
Yeah, they made money, but that is not the cause of the failure I suspect, it is a separate event.
I bet they way they handled the contract might be up for a review for sure, which would affect stock price, but seeing them cuffed won't actually make shareholders any happier. It's a shame that they can't be made to revert the transactions and the money split between holders, now that would make people very happy indeed.
Please keep the psychopaths in the nuthouse.
The problem is, even if they knew in May that things were going sour with Apple, if theirs was part of a pre-planned, programmed sale (and done by a third party), there's probably not much the court can do. The courts could try and go after them for fraudulent conveyance, but that is very difficult to prove, unless it was obvious that they knew this was heading south at the time the stock sales were planned.
As I've said elsewhere, the defining principle that courts use is the so-called 'business judgment rule', which gives a lot of the benefit of doubt to senior execs in the Anglo-American governance system. Why do you think, for instance, very few bankers have been found guilty despite the devastating financial crisis recently?
It'll be interesting to see how this case develops.
Excellent post, to which I'll add only this. GTAT's view of how well, or poorly, things were going at each step of the process, had better synch up with the records and recollections within the halls of Apple. In any investigation associated with these executive stock sales, Apple's version of events will certainly be brought before the court. Let the games begin. This could be quite fun to follow.
This Teabagger congress? GTAT screwed Apple and managed to transfer millions of dollars from the poor (well, poorer) to the rich. They'd probably give these guys the Medal of Freedom.
Okay, yeah, this is why we have PO: so that nonsense can be kept where it belongs.
Oh, that's not .0001% of how I feel about those fuckers. You really don't want to hear my real opinion.