MDC Incentee goes Cha-Ching, Part II
According to Forbes.com, NGSG VP of Accounting cashed out shares of the company last Friday for about $30 a share:
The vice president of accounting for Natural Gas Services Group Inc., a provider of compression equipment and services to the natural gas industry, sold 5,000 shares of common stock, according to a Securities and Exchange Commission filing Monday.
I am thrilled that NGSG is doing so well the directors of the company can cash out shares and bring home profits into their personal accounts. More power to them!
However, a company that is doing so well its directors can cash out about $450,000 in corporate shares over the last two weeks doesn't seem like a company that needs a $275,000 forgivable loan from the MDC. Right or wrong, the perception of spending economic DEVELOPMENT money on a business doing so well their directors can cash out hundreds of thousands of dollars is very poor.
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3 Comments
Amen and Amen .
Actually the amount of stock sold by various officers and directors of NGSG is much higher. According to their SEC filings, multiple directors and officers have sold stock this quarter. According to the NGSG investor relations website, there have been 12 S4 filings with the SEC this quarter.
I'm sure these are just routine sales and the timed vesting of stock options, or some other mundane corporate financial transaction, but the bottom line is the same, if a company's directors and officers can cash out millions of dollars in stock in a quarter, why do they need economic development money?
Indeed. As you've suggested, more than suggested, it seems that the point of MDC is not promoting business development but spending OPM.
And forgive my fiscal near-illiteracy, could this be an omen of a planned default on the loan? After all, such things would not be unprecedented. Enron executives cashed out big time (and prohibited lesser Enron employees from doing so) before its death throes were made public.
As an aside, we all heard of many of the lesser people in Enron who had put their entire savings into Enron stock and then complained bitterly that they'd lost everything. The ones I heard were complaining bitterly that they too couldn't cash out. What human kindness I had felt for them shriveled at that time.