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Post by pmikeks on Aug 8, 2014 18:27:43 GMT -5
I thought Monday was going to be a positive CC for us, I am interested in what all of you think this means. I have read some of these insider stock sales are pre-planned but according to what I read in SEC filing, these didn't expire for several years. Why would he execute his stock options if Monday is going to be good news? I guess the 10B5-1 plan allows them to do this close to a material event, all stock plans I was invoked with didn't allow officers to do this.
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Post by babaoriley on Aug 8, 2014 19:07:52 GMT -5
Let's think about this. The General Counsel of a publicly traded company sells 30,000 shares right before a conference call!! Boy, if the cc doesn't bring wine and roses, I'm guessing if the implication of your post is correct, he's going to be doing time!! Can he say he didn't know the law? Don't think so. Perhaps he just wants to ruin his career and go to jail, right?
And, what would it look like if he had a planned sale for this week, and cancelled it, knowing good news was on the way on Monday, boy, that would smell like Limburger cheese left in a hot trash can for about two weeks! Wait, Al wouldn't tell him about any good news, would he? Oh, he is the GC, he just might have gotten a sniff.
I have to conclude that our General Counsel is either (1) the dumbest GC on earth, (2) the gutsiest GC on earth, (3) a guy that wants to spend a little time in prison, or (4) a guy who is following the law and selling cuz it was already planned. Now, those are four tough choices, and it will take me all weekend to figure out which it might be. pmkeks, if you figure it out first, please post your conclusion.
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Post by mannmade on Aug 8, 2014 19:11:13 GMT -5
Baba... LOL! Think we are forgetting he had a major divorce settlement last year and sold almost half his holdings as I recall... Perhaps he has child support or college tuition due.. Not to sound too cavalier about the this event but at this point... It is not something I find terribly relevant to the partnership announcement at this point... Agree w above...
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Post by paulie on Aug 8, 2014 19:17:17 GMT -5
Baba... LOL! Think we are forgetting he had a major divorce settlement last year and sold almost half his holdings as I recall... Perhaps he has child support or college tuition due.. Not to sound too cavalier about the this event but at this point... It is not something I find terribly relevant to the partnership announcement at this point... Agree w above... I think we are talking about another officer that is going through a divorce. Dr. Tran was also angry about this sale, but I have to go with baba. If it was a planned sale, and he cancelled it so near to a material event (announcement), I do think that that he would face some pretty steep consequences.
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Post by dreamboatcruise on Aug 8, 2014 19:18:21 GMT -5
Baba... it was planned, that is stated in the filing.
There is some controversy of legality of canceling planned sales, but in any case it wouldn't look good.
After Rule 10b5-1 was enacted, the SEC staff publicly took the position that canceling a planned trade made under the safe harbor does not constitute insider trading, even if the person was aware of the inside information when canceling the trade. The SEC stated that, despite the fact that 10b5-1(c) requires trades to be irrevocable, there can be no liability for insider trading under Rule 10b-5 without an actual securities transaction, based on the U.S. Supreme Court's holding in Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723 (1975).[6]
It seems like it should be wrong, but I understand the difficulty of prosecuting someone for insider "trading" if no trade occurred.
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Post by 4Balance on Aug 8, 2014 19:19:03 GMT -5
That's one expensive college...but my vote goes for "planned sale."
Anything else and he's toast...and he knows that better than most.
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Post by pmikeks on Aug 8, 2014 19:26:07 GMT -5
I thought it might be a planned sale, the numerous years before expiration is what I find confusing
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Post by dreamboatcruise on Aug 8, 2014 19:32:34 GMT -5
I thought it might be a planned sale, the numerous years before expiration is what I find confusing There can be different reasons a person might exercise long before expiration. One is if they need the money, likely the case here as pre planned exercise and sell, or it could be if someone wants to exercise and hold so that anticipated gains can be at long term capital gains rate rather than ordinary income which is what one must pay for the difference between exercise price and fair market value at time of exercise.
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Post by paulie on Aug 8, 2014 19:33:09 GMT -5
4balance -- What do you mean "anything else and he's toast"? (just wanted clarification) If he didn't go ahead with the sale, his reputation would take a hit? It sounds like he could be a bit greedy (hold those shares through CC on Monday) and not face any legal consequences. I am betting that $250K vs a hopefully doubling of the SP is nothing to him though.
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Post by dreamboatcruise on Aug 8, 2014 20:07:21 GMT -5
I think I gave misleading info. It seems SEC has clarified that canceling a plan based on knowledge of an event would be actionable as insider trading...
On March 25, 2009, the SEC staff revised its interpretative guidance regarding the circumstances under which the affirmative defense in Rule 10b5-1(c) is available.[14][15] In particular, the staff followed the approach previously urged by some commentators[9] to clarify (1) that the cancellation of a 10b5-1 plan could call the good faith of other, executed plans into doubt and (2) that the Supreme Court's decision in Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723 (1975), did not affect the SEC's ability to bring an enforcement action against a would-be insider trader who canceled a trading plan and did not trade in a particular transaction because a subsequent decision, Merrill Lynch, Pierce, Fenner & Smith, Inc., v. Dabit, 547 U.S. 71 (2006), made clear that Blue Chip Stamps dealt only with the implied private right of action for violations of Rule 10b-5 and not the "in connection with" requirement for all Rule 10b-5 violations.
Though all these SEC rules are clearly above a lizard's pay grade.
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Post by daduke38 on Aug 8, 2014 21:10:46 GMT -5
Agree with why he couldn't cancel it. Just curious, where is Dr. Tran's comment and / or what was it? I really think the FDA delay threw off quite a few planned sales.
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Post by 4Balance on Aug 9, 2014 0:59:40 GMT -5
4balance -- What do you mean "anything else and he's toast"? (just wanted clarification) If he didn't go ahead with the sale, his reputation would take a hit? It sounds like he could be a bit greedy (hold those shares through CC on Monday) and not face any legal consequences. I am betting that $250K vs a hopefully doubling of the SP is nothing to him though. Sorry, Paulie...I should have included babariley's comment: "I have to conclude that our General Counsel is either (1) the dumbest GC on earth, (2) the gutsiest GC on earth, (3) a guy that wants to spend a little time in prison, or (4) a guy who is following the law and selling cuz it was already planned. Now, those are four tough choices, and it will take me all weekend to figure out which it might be. pmkeks, if you figure it out first, please post your conclusion." I picked #4....especially rejecting #3. I don't think MNKD would retain a "dumb" lawyer, and "too gutsy" might also be a red flag to them.
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Post by ashiwi on Aug 9, 2014 6:08:52 GMT -5
Don't forget, he still owns 220,000 more shares. Enough to make him very very wealthy over the next couple of years .
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Post by cybergym66 on Aug 9, 2014 6:20:37 GMT -5
I think we're spending way too much time discussing a non-event...30K out of 250K is NOT a big deal! Let's keep our eyes on the prize!!! ---Partnership(s)
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Post by pmikeks on Aug 9, 2014 15:08:18 GMT -5
If it's what we all hope it is, he is the dumbest GC if he could have sold enough to pay the taxes and held the rest like Matt did a few weeks ago.
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