Boston, MA 10/15/2014 (wallstreetpr) – The U.S. watchdogs have asked GT Advanced Technologies Inc (NASDAQ:GTAT) to come clean over the reason of its filed bankruptcy. The company lately known for its agreement with Apple Inc. (NASDAQ:AAPL), gave a shock to investors earlier this month by its Chapter 11 filing. The bankruptcy filing was quiet on reasons of such move.
Apple Takes Off Support
GT Advanced Technologies Inc (NASDAQ:GTAT) explained the reason of being mum over the cause under the pretext of potential penalties that it could accrue from Apple. The company said that uncovering of the reason would hold it liable to pay $50 million for each secret revealed as per the confidentiality agreement signed with the i-Phone maker. The company gained traction after Apple signed an agreement with it to produce sapphire for its iPhones screens.
However, the new iPhones were put on shelves without those screens. Later, GT Advanced Technologies Inc (NASDAQ:GTAT) made a request to close down its synthetic sapphire operations stating that its contract with Apple was “burdensome” and “oppressive”. However, the U.S. Trustee now wants the company to open about the factors that drove to bankruptcy to be able to shore up confidence among creditors.
Executives Sold Shares
Also, reports have emerged that how Daniel Squiller, who is Chief Operating Officer at the company’s Mesa, Ariz facility sold $1.2 million of his shares in May, at the sight of first troubles. The filing reveals that Squiller systematically unloaded his holdings in the company months before the bankruptcy filing. The company’s CEO Thomas Gutierrez is also alleged to have sold $160,000 worth of his shares just before Apple’s announcement of non-inclusion of sapphire screens.
GT Advanced Technologies Inc (NASDAQ:GTAT) failed to secure loan prepayments from Apple Inc. (NASDAQ:AAPL) after it missed attaining certain technical and financial criteria set as pre-condition for financing its sapphire plant. Squiller could not be reached for the comment so far.
