Author Topic: Good News finally  (Read 15295 times)

Rob L

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Re: Good News finally
« Reply #15 on: June 15, 2016, 10:29:31 AM »
These are probably the puts (at close 6/14/2016).
If LC closes at or above $5 per share they are worthless.
Root      Strike Puts     Last    Chg  Bid   Ask  Vol  Open Int
LC     5 Jun 17, 2016   0.79   0.14 0.60 0.90 204  63005      He has (had) 63,000 of these

His PUT position is 9.3 million shares, and he is SHORT the PUTs, LONG the CALLs.
https://www.sec.gov/Archives/edgar/data/1409970/000119312516598328/d199172dex992.htm

Thanks for the correction! I couldn't or didn't know how to find that Edgar data and took my best shot from various news articles. The Calls were pretty easy to find, but not the puts. The Edgar data doesn't provide the strike prices, but it seems a reasonable guess from prices paid that all the puts are all $5's. That's a guess. The calls are as shown in my prior post.

Since Chen's short the puts his whole position is bullish. If I did the math right (and if he still holds these securities) then here's where he will wind up given various closing prices Friday (all numbers are $100's or 100's of shares if assigned the short puts and/or exercises the long calls that are in the money).

Close Price      Net Profit / Loss (excluding to keep it simple the prices received and paid for the options themselves)
2.00                   -279,000
3.00                   -186,000
4.00                   -48,000
4.19                   0
5.00                  201,999
6.00                  358,998

Half Right

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Re: Good News finally
« Reply #16 on: June 15, 2016, 12:54:44 PM »
His entire position in the options is bullish and is a cheap way of leveraging more shares. In all probability he will roll the entire position forward to some future expiry date.






Or not.

Rob L

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Re: Good News finally
« Reply #17 on: June 15, 2016, 03:13:07 PM »
Sure; he could be a long way towards doing that by now anyway.

RT45

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Re: Good News finally
« Reply #18 on: June 16, 2016, 01:14:52 AM »
Seem odd to anyone else that on June 07 it was leaked via "familiar sources" that Renaud was looking at a buy-back / taking private and then less than a week later decides to unload shares?

Rob L

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Re: Good News finally
« Reply #19 on: June 16, 2016, 09:35:07 AM »
Maybe; but I remembered before 5/9 RL had gotten a personal loan from board member John Mack to make some payment coming due and RL did not want to sell shares to do it. So, he's paying Mack back or he just flat needs the money. He got no severance. Also could be that when the rumor of his taking LC private came out it landed with a big thud and that is over. A stranger possibility is that the plan to take LC private is going so well he sold to convince the market the company isn't in play while it's being accumulated elsewhere. I admit that last one's really far fetched ???

Lots of maybe's....

SLCPaladin

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Re: Good News finally
« Reply #20 on: June 16, 2016, 11:07:50 AM »
Maybe; but I remembered before 5/9 RL had gotten a personal loan from board member John Mack to make some payment coming due and RL did not want to sell shares to do it. So, he's paying Mack back or he just flat needs the money. He got no severance. Also could be that when the rumor of his taking LC private came out it landed with a big thud and that is over. A stranger possibility is that the plan to take LC private is going so well he sold to convince the market the company isn't in play while it's being accumulated elsewhere. I admit that last one's really far fetched ???

Lots of maybe's....

I think the best guess is cash flow issue. If memory serves me correctly, he only sold 14% of his shares. I'm sure he still believes in LC, but post IPO I'll bet he spent as if his total net worth was significantly higher than it is at current share valuations. As a result, he went on a consumption binge (he seems to have a taste for the finer things in life, not a Warren Buffett type who will be content to stay in is old house, driving his old car).

RT45

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Re: Good News finally
« Reply #21 on: June 16, 2016, 03:18:38 PM »
@Rob L - unfortunately I'm not familiar enough with options to add much value here, but +1 for any additional research from anyone into this area.

jheizer

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Re: Good News finally
« Reply #22 on: June 16, 2016, 03:21:34 PM »
Too bad I didn't buy more than the tiny 575 shares that I bought.  A month of the stock could have replaced 5 years of note returns.
Replacement to P2P Quant's Percentile Tool http://lc.geekminute.com

flojoflojo

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Re: Good News finally
« Reply #23 on: June 16, 2016, 07:59:19 PM »
Renaud needed some $ for his legal defense fund.

fliphusker

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Re: Good News finally
« Reply #24 on: June 16, 2016, 08:03:58 PM »
LC stock over $5 in after hours trading.  Friday May 6th, was trading at $7.10.

Rob L

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Re: Good News finally
« Reply #25 on: June 17, 2016, 09:27:09 PM »
If Mr. Chen wanted more LC shares and he held those options through expiration he's going to be owning more. The stock closed at $4.87.
First he was short 93,000  $5 puts. The owners of those puts are gonna make him buy 9.3M shares at $5 each that they can buy or borrow at $4.87.
Second he owns 45,000 $3 calls allowing him to buy 4.5M shares at $3 per share; $1.87 below current market price.
Finally he owns 111,999 $4 calls allowing him to buy 12M shares at $4 per share; $0.87 below current market price;
Could be he's the proud owner of 25.8M more LC shares. His original investment was 29M shares (11.7% of the company).
The new shares represent another 10.4% of the company (if the reported 11.7% was correct), making his total ownership a little over 22%.

Of course who knows if he held the options through expiration or not. We will we'll hear about it at the stockholder's meeting if not before.
Or maybe there will be another Edgar submission I can't find.

Rob L

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Re: Good News finally
« Reply #26 on: June 20, 2016, 10:03:31 AM »
Per an SEC filing this AM Shanda has increased its holdings to 15.13% of LC (57.7M shares).
That's up from the 44.7M original shares reported on May 11 (11.7%).
Probably the bottom line result of options expiration last Friday.

https://www.sec.gov/Archives/edgar/data/1318400/000094787116001279/ss1508147_sc13da.htm
« Last Edit: June 20, 2016, 10:11:04 AM by Rob L »

jheizer

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Re: Good News finally
« Reply #27 on: June 20, 2016, 10:07:33 AM »
Replacement to P2P Quant's Percentile Tool http://lc.geekminute.com

Fred93

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Re: Good News finally
« Reply #28 on: June 20, 2016, 12:31:17 PM »
Today's 13D has both exercises of options and some non-exercise purchases.  (See note 4)  Lots of activity.

Here are the transaction details...
https://www.sec.gov/Archives/edgar/data/1318400/000094787116001279/ss1508147_ex9902.htm

This fellow surely has asked for a board seat by now.  I suppose that will be revealed at the 6/28 shareholder's meeting.

fliphusker

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Re: Good News finally
« Reply #29 on: June 20, 2016, 01:07:16 PM »
Today's 13D has both exercises of options and some non-exercise purchases.  (See note 4)  Lots of activity.

Here are the transaction details...
https://www.sec.gov/Archives/edgar/data/1318400/000094787116001279/ss1508147_ex9902.htm

This fellow surely has asked for a board seat by now.  I suppose that will be revealed at the 6/28 shareholder's meeting.
This is where I get pretty lost in things.  :(  All the ones listed on 6/17 where the expiring options from Friday, correct?  A chunk that Chen snapped up?  Good sign to only see options only being bought?  What is your take from what you see there Fred?