Ondrej Holzman Virtually all contracts between GT Advanced Technologies and Apple are classified as confidential, but the bankruptcy proceedings could expose a lot of confidential information to the public. With respect to its creditors and shareholders, the court is asking the sapphire producer, which due to financial difficulties last week declared bankruptcy.
GT Advanced's reason for filing for Chapter 11 bankruptcy protection remains hidden from the public, as contracts with Apple are classified as secret, with GT facing a $50 million fine for any disclosure of details about upcoming, as-yet-unannounced products .
However, the agreements, which GT Advanced describes as "oppressive and onerous," keep the company's creditors and shareholders, who have already filed a class-action lawsuit against the company for "misrepresenting and/or withholding" information about its financial situation, without information. Even in August, during the announcement of financial results, GT Advanced claimed that it would meet the goals proposed by Apple and receive the last installment of 139 million.
A few weeks later, however, it turned out that GT Advanced met Apple's requirements couldn't, about the last installment from the total 578 million dollars came in and was forced to file for bankruptcy and seek protection from creditors. However, due to the concluded contracts, he cannot reveal anything about his situation now. That is why he is now turning to the court to lift the secrecy in the interest of shareholders and creditors and more information can be disclosed. Even the nondisclosure agreements themselves are marked "secret."
From GT's point of view, the request to publish the complete contracts is logical, but it could pose serious problems for Apple. Not only can these contracts specify sapphire specifications for future products, but they will also include pricing and cost calculations that other suppliers could then use in negotiations with Apple.
GT Advanced claims the nondisclosure agreements present "fundamental logical problems" and give Apple "undue power." GT now owes creditors and bondholders more than $500 million, but said in its request to unseal selected contracts that it would not disclose them unless it received a clear order from the court because it could face fines reaching hundreds of millions of dollars.
I don't really understand why they are crying now that they signed a contract with Apple, even though it apparently has very strict conditions. If I don't want to do the business, I won't sign. If I think that the contract is unilaterally disadvantageous and can cause me problems, I will not sign the contract.
The only thing that comes to my mind is that due to the size of their obligations to creditors, they were already close to bankruptcy before signing the contract with Apple and were willing to sign anything just to avert bankruptcy and protection from creditors. And now I blame it on Apple.
The rest of the management of the company in the cell with Thomas Gutierrez will be pretty baked if he just sells shares of the company worth a million dollars while the company he leads is going bankrupt. It reminds me of some Czech businessmen.