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Equipment Discussions >> Cats & Casses

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bilgebay
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Re: The plot thickens (Meade takeover) [Re: nitegeezer]
      #5939084 - 06/25/13 02:23 AM

This thread made me very sad. I don't like to see any businesses in this shape.

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bicparker
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Re: The plot thickens (Meade takeover) [Re: EddWen]
      #5939192 - 06/25/13 06:24 AM

Some interesting and very good points.

I'm confused on your first one, however. The Board of Directors does have authority to approve or reject, but only as a recommendation to the shareholders. Merger adoption still requires a full shareholder vote (as noted in the filing 14A proxy). This is why a special shareholder meeting was called. And such an action still doesn't prevent outside public tender offers.

It should be noted that the MIT Capital public tender offer (filed June 21) is being made outside the internal board process and they were rejected, for the record at least, because they would not sign on to a confidentiality agreement, and were thus never bound by it. So the legal obligation only extends only to those who sign on to that. MIT Capital probably did not sign on because they wanted to keep their public tender offer option open, knowing that management would not likely accept their offer since it included the dissolution of the current management.

This public tender offer is interesting because, among other things, it basically recognizes the poison pills in Meade (namely the executive golden parachutes) as not that significant an obstruction. MIT Capital is essentially saying, "We'll spend about $5 million or so to buy the Meade assets and still come out ahead and to heck with their management."

When you mention avoiding bankruptcy, I presume you are referring to Chapter 7 liquidation, as opposed to Chapter 11 reorganization. At this point, of course, Meade has very little other recourse than Chapter 7 since they already have exhausted most, if not all, funding options over the past few years. Their most recent loan was a very high interest loan (prime +4% floating with a minimum monthly interest accrual) with extremely favorable terms for the lender (no covenants but it can be called anytime). Meade might have been able to make a play for Chapter 11 a few years ago and, in hindsight, this might have been a good option. Unfortunately, they were in a situation where their book value far exceeded their market value, which created other dynamics that obviated that route.

Make no mistake here... The MIT Capital offer is a form of liquidation where MIT Capital will take the place of the bankruptcy judge and receiver. The liquidation will essentially move the Meade assets into MIT Capital's business model how they see fit (as indicated in their filings). The Meade name will likely persist, but the old Meade as we know it will not.

The MIT Capital offer throws a bit of a monkey in the wrench since they are basically making a direct public appeal to the shareholders to immediately liquidate their shares for what is left of the market value of Meade. Then MIT Capital will determine how Meade fits into their overall business model (this includes terminating the current executive management altogether). The other deal does not maximize the shareholder market value, but it instead constructs a route of continuity for Meade. Since there really aren't that many shareholders involved, it will be interesting to see how that plays out. Do they want their money or do they want Meade to continue more or less as is?

Quote:

Pedantic Mode ON from a prior life.

A few Business M&A basics that may have relevance to the Meade situation.

---Unless the by-laws of incorporation specifically require a shareholder vote on any M&A activity (this is rare) the Board of Directors has the full authority to accept or reject any offers.

---No one involved in the process is allowed to discuss any of the proceedings with anyone outside of the situation. This is a legal obligation of those involved.

---The BoD is not required to accept the highest monetary offer. It can consider other attributes from an offer within the bounds of performing their fiduciary responsibilities to the shareholders.

---Most VCs create a ‘named fund’ through which the VC Managing Directors work. The fund is not required to carry the name of the VC group. Sometimes they do and sometimes they don’t. The funds are usually a legal entity such as a LLP or LLC formed specifically for a purpose.

---The BoD should avoid bankruptcy if at all possible. BK puts the shareholders at the lowest rung of the ladder with regard to holding any value. A Judge in a Bankruptcy Court will have the authority to decide which claimants would get what share of proceeds resulting from the sale of assets. Any funds/assets need not be distributed equally.

---Funds to keep a company operating through a troubling period are sometimes available to borrow, at very high interest rates. Such loans are written to usually have first claim in a bankruptcy proceeding.

---In the several situations I am familiar with, manufacturing in Mexico is done on a contract basis. As such, the facility is not the company’s asset. And, in fact, if a bankruptcy occurs, the contractor may have a major claim in Bankruptcy Court.

Pass the popcorn.




Edited by bicparker (06/25/13 06:28 AM)


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Qwickdraw
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Re: The plot thickens (Meade takeover) [Re: Pedestal]
      #5939204 - 06/25/13 06:40 AM

Quote:

Buying Meade is buying a name, lntellectual rights, inventory.

Hubert



you are also buying liabilities,dept in most cases.


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dawziecat
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Re: The plot thickens (Meade takeover) [Re: Qwickdraw]
      #5939265 - 06/25/13 08:05 AM

No stock expertise here . . . none whatsoever.

No interest in Meade either, neither financial nor emotional.

I note though that share price on the NASDAQ is now UP to $3.70. Quite far north of the JOC offer of $3.45.

Considering the desperate news of the imminent demise of this company, it is a mystery to me why stock prices would be going up?

It's all right to hope for a Phoenix-like rebirth but this looks more like a death watch to my uneducated eye.

Are there still people awaiting return of their repaired LX-800s?


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Spacetravelerx
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Re: The plot thickens (Meade takeover) [Re: dawziecat]
      #5939275 - 06/25/13 08:13 AM

Quote:

No stock expertise here . . . none whatsoever.

No interest in Meade either, neither financial nor emotional.

I note though that share price on the NASDAQ is now UP to $3.70. Quite far north of the JOC offer of $3.45.

Considering the desperate news of the imminent demise of this company, it is a mystery to me why stock prices would be going up?

It's all right to hope for a Phoenix-like rebirth but this looks more like a death watch to my uneducated eye.

Are there still people awaiting return of their repaired LX-800s?




dawziecat,

People also thought Celestron was going through a death watch back in the day. They didn't die. I am pretty certain Meade will be around. Meade still has significant value, or legs, in my view. Coronado telescopes, LX200, LX600, LX850, etc. etc. - a lot of IP there and name recognition. It is just saddled with debt and cash flow issues.

I believe everyone got their repaired LX800.

I am part of the batch of the new LX850s (i.e. not a repaired LX800).


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rmollise
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Re: The plot thickens (Meade takeover) [Re: Jared]
      #5939353 - 06/25/13 09:17 AM

Quote:


Sorry--I had intended to say "digital astrophotography" which was quite new in the amateur world about 15 years ago. Obviously, there have been amateurs using hypered film, cold cameras, and ordinary 35mm for a long time.

The point, though, remains. I believe that a lot of additional astrophotographers have been drawn into the hobby in the past fifteen years or so with the advent of digital tools.




For the record, Celestron was there with digital imaging, too, partnering with SBIG to produce the often forgotten Faststar 8 and a camera to go with it. You might say that was more of an innovation than what Meade was doing at the time.


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mayidunk
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Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5939372 - 06/25/13 09:31 AM

Quote:

Quote:


Sorry--I had intended to say "digital astrophotography" which was quite new in the amateur world about 15 years ago. Obviously, there have been amateurs using hypered film, cold cameras, and ordinary 35mm for a long time.

The point, though, remains. I believe that a lot of additional astrophotographers have been drawn into the hobby in the past fifteen years or so with the advent of digital tools.




For the record, Celestron was there with digital imaging, too, partnering with SBIG to produce the often forgotten Faststar 8 and a camera to go with it. You might say that was more of an innovation than what Meade was doing at the time.



Didn't Meade actually have to catch-up on prime focus imaging in a kind of "me too" fashion when they started producing Hyperstar compatible SCTs?


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rmollise
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Re: The plot thickens (Meade takeover) [Re: mayidunk]
      #5939420 - 06/25/13 10:03 AM

Quote:


Didn't Meade actually have to catch-up on prime focus imaging in a kind of "me too" fashion when they started producing Hyperstar compatible SCTs?




Meade never produced Hyperstar compatible OTAs. There was a conversion kit for their scopes produced and sold for a while by Starizona. Meade made a line of CCD cameras that were mostly notable for their use of a SCSI connection. Unfortunately, it was hard to get working. IMHO, their most important contribution was more humble, their DSI series, which were different from what else was available at the time.


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PatHolland
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Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5939430 - 06/25/13 10:13 AM

I agree with you Uncle Rod. Meade can definitely take a lot of credit for the amateur AP boom with the low cost CCD DSI cameras.

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Starhawk
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Re: The plot thickens (Meade takeover) [Re: mayidunk]
      #5939435 - 06/25/13 10:14 AM

No- Starizona did all of that work on their own. And when they attempted to collaborate with Meade to make hyperstar compatible ACF scopes (since it was no longer a Schmidt configuration, they needed data to work with the new prescription), Meade initially said yes then backed out. And that's why Meade compatible hyperstar disappeared.

In the same timeframe, Celestron actively collaborated to make the edge Hyperstar compatible. That's why it is a standard SCT in the front end and the flattening optics are in the baffle tube.

The excuse for blowing the deal was protecting proprietary information. Keep in mind this was from a business partner whose only hope of recouping his investment in a Meade ACF compatible hyperstar is if there are Meade ACF telescopes to put it on.

So, the decisions leading to where things are now have been made in all areas.

-Rich


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Jon Isaacs
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Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5939437 - 06/25/13 10:15 AM

Quote:

Meade made a line of CCD cameras that were mostly notable for their use of a SCSI connection. Unfortunately, it was hard to get working.




I believe that was the 416? Lotta threads on that one back in the day. I think there was a time when it just wouldn't work.

Jon


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rmollise
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Re: The plot thickens (Meade takeover) [Re: Jon Isaacs]
      #5939460 - 06/25/13 10:31 AM

Quote:

Quote:

Meade made a line of CCD cameras that were mostly notable for their use of a SCSI connection. Unfortunately, it was hard to get working.




I believe that was the 416? Lotta threads on that one back in the day. I think there was a time when it just wouldn't work.

Jon




That was one of 'em...there were at least three (four?) in the line...


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Jon Isaacs
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Re: The plot thickens (Meade takeover) [Re: rmollise]
      #5939468 - 06/25/13 10:35 AM

Quote:


That was one of 'em...there were at least three (four?) in the line...




Were they all SCSI? I remember one called the 208, I remember the long threads on the problems with the 416... not much about the others.

Jon


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bicparker
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Re: The plot thickens (Meade takeover) [Re: dawziecat]
      #5939477 - 06/25/13 10:37 AM

Terry,
The stock price doesn't always reflect the actual performance of the underlying business entity. It really just reflects the demand for the stock and what creates those demands. In this case, even though JOC's offer is $3.45, there is now a filed tender offer by MIT Capital for $3.65 per share. This is what really caused that bump in stock price.

The stock price for Meade should be viewed with a grain of salt in any case. This is a thinly traded stock with very sporadic volume. It's volume is extremely low and may only reflect one or two trades on a given day. I've seen large price changes in Meade simply due to an exercise of a single employee stock option or a bulk trade by an institutional investor.


Quote:

No stock expertise here . . . none whatsoever.

No interest in Meade either, neither financial nor emotional.

I note though that share price on the NASDAQ is now UP to $3.70. Quite far north of the JOC offer of $3.45.

Considering the desperate news of the imminent demise of this company, it is a mystery to me why stock prices would be going up?

It's all right to hope for a Phoenix-like rebirth but this looks more like a death watch to my uneducated eye.

Are there still people awaiting return of their repaired LX-800s?




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dawziecat
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Re: The plot thickens (Meade takeover) [Re: bicparker]
      #5939509 - 06/25/13 10:59 AM

Quote:

Terry,
The stock price doesn't always reflect the actual performance of the underlying business entity. It really just reflects the demand for the stock and what creates those demands. In this case, even though JOC's offer is $3.45, there is now a filed tender offer by MIT Capital for $3.65 per share. This is what really caused that bump in stock price.

The stock price for Meade should be viewed with a grain of salt in any case. This is a thinly traded stock with very sporadic volume. It's volume is extremely low and may only reflect one or two trades on a given day. I've seen large price changes in Meade simply due to an exercise of a single employee stock option or a bulk trade by an institutional investor.




Thanks for the education, David. It all makes sense.


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Jon Isaacs
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Re: The plot thickens (Meade takeover) [Re: dawziecat]
      #5939579 - 06/25/13 11:44 AM

Quote:

Quote:

Terry,
The stock price doesn't always reflect the actual performance of the underlying business entity. It really just reflects the demand for the stock and what creates those demands. In this case, even though JOC's offer is $3.45, there is now a filed tender offer by MIT Capital for $3.65 per share. This is what really caused that bump in stock price.

The stock price for Meade should be viewed with a grain of salt in any case. This is a thinly traded stock with very sporadic volume. It's volume is extremely low and may only reflect one or two trades on a given day. I've seen large price changes in Meade simply due to an exercise of a single employee stock option or a bulk trade by an institutional investor.




Thanks for the education, David. It all makes sense.




Well, I am not sure it all makes sense.. but what David said does.


Jon


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rmollise
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Re: The plot thickens (Meade takeover) [Re: Jon Isaacs]
      #5939653 - 06/25/13 12:25 PM

Quote:



Were they all SCSI? I remember one called the 208, I remember the long threads on the problems with the 416... not much about the others.

Jon




I believe the basic models, the 208 and 216, didn't have SCSI...you hand to move to the 416 or the 1616 for that...


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Starhawk
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Re: The plot thickens (Meade takeover) [Re: Jon Isaacs]
      #5939671 - 06/25/13 12:33 PM

"Sense" is a hard word to get our hands around at this point, it seems.

I don't know that the market is big enough to support two companies the size of Synta. Maybe I should say I'm fairly certain it can't. On the other hand, there just isn't infinite room at the top end for another RC optical or Plane Wave, so I'm struggling where this can go. I've been listening to what people have said and gathered more information. The sad truth appears to be neither Celestron nor Meade were ever really healthy at the same time.

This indicates to me whatever form the new Meade would take, it would have to be very different from the old Meade, Tasco, Celestron, Synta, or Bushnell if it was to survive. We aren't talking about cars, here- the market is quite possible to completely satisfy with very finite sales volume.

-Rich


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csrlice12
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Re: The plot thickens (Meade takeover) [Re: nitegeezer]
      #5939794 - 06/25/13 01:25 PM

Ah, but the smart businessperson would WANT to see Meade go bankrupt, that way they can get the company for pennies on the dollar AND the stockholders get nada......then you can sack the company for every penny you can squeeze out of it and walk away....as long as employees and the company product don't mean anything to you.....

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jrcrillyAdministrator
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Re: The plot thickens (Meade takeover) [Re: Jon Isaacs]
      #5939943 - 06/25/13 02:57 PM

Quote:

Quote:

Meade made a line of CCD cameras that were mostly notable for their use of a SCSI connection. Unfortunately, it was hard to get working.




I believe that was the 416? Lotta threads on that one back in the day. I think there was a time when it just wouldn't work.

Jon




The 416 was up against the ST-7. The 1616 (I never saw one) was up against the ST-8. They were much less expensive and, except for the SCSI thing and some shutter failures, were not bad. Even when SCSI got tangled up they could be used via RS-232. This was considered way too slow, but later on when I had an STL-11000 I found it to be about as slow as my 416 had been in serial mode. The 1616 would have been unusable in that mode (WAY too slow).


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