Ram et al., agreed that this removes a lot of negatives.
No doubt, the 'sword of Damocles' hanging over this company has been the lawsuit ... quietly receding into the distant and forgotten past, as the shareprice appreciated; yet looming once again in our future as the trial date (July '00) approached.
The way I'd always viewed it, it was a matter of who knew what, and when: with a technology startup, how can you say with certainty that no unforeseen problems will arise? You cannot. Rather, you actually expect and anticipate the scientific and engineering problems... knocking them down, one at a time, until one day, lo, you find there are no more hurdles ahead of you. (Rather like the 'delays' in the plant startup, long behind us now, thankfully...)
From that perspective, how could these prior shareholders have claimed they were defrauded? This lawsuit strained credulity....
Yet, the rate of insider sales (not unusual as the means for the founders of a company that has gone IPO to recoup the rewards of their work) was mildly accelerated just prior to the dissolution of the Motorola contract. An unfortunate 'smoking gun,' upon which the entire lawsuit was hung; no doubt, without the insider sales, the lawsuit would not have arisen. And yet... could they have proven that the lead engineers KNEW without a doubt that the final hurdles could NOT be overcome? Doubtful. And to even argue the case in a court of law, the level of investigation that would have been required into the company's workers' lab notebooks would have been so intrusive as to have compromised the nature of the fundamental research... and this could never have been allowed by the company.
All in all, the company played their cards right: delay settlement until the shareprice is high enough so that the settlement is only a nuisance, a minor dilution.
Onwards and upwards from here, unimpeded. I support the settlement, for these reasons.
Sidebar: I always interpreted that I was a default member of this lawsuit, though have not been contacted in years (believe that I was, long, long ago...). I still own shares from '94, and sold others for a modest loss that year. Yet, if/when I receive my portion of the settlement, it'll just be that much more to give to charity. No problems finding a good use to put it to... Just wish the lawyers didn't take such a big cut first. And would have preferred the lawsuit was never begun.
Sidebar #2: Isn't it odd, that plaintiffs who were claiming the company was a 'scam' and a 'fraud' actually just wanted a piece of the action, shares in that same company? LOL! |
