LOS ANGELES--(BUSINESS WIRE)--Glancy Prongay & Murray LLP (“GPM”), announces that it has filed a class action lawsuit in the United States District Court for the Central District of California, captioned Spitzer v. Flexon, et al., Case No. 23-cv-8659, on behalf of persons and entities that purchased or otherwise acquired Capstone Green Energy Corporation (“Capstone” or the “Company”) (OTC: CGRNQ) securities between June 14, 2021 and September 22, 2023, inclusive (the “Class Period”). Plaintiff pursues claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”).
Investors are hereby notified that they have 60 days from the date of this notice to move the Court to serve as lead plaintiff in this action.
If you suffered a loss on your Capstone investments or would like to inquire about potentially pursuing claims to recover your loss under the federal securities laws, you can submit your contact information at www.glancylaw.com/cases/Capstone-Green-Energy-Corporation/. You can also contact Charles H. Linehan, of GPM at 310-201-9150, Toll-Free at 888-773-9224, or via email at email@example.com or visit our website at www.glancylaw.com to learn more about your rights.
On August 15, 2023, after the closing of trading, the Company announced its inability to timely file a Form 10-Q due to an “ongoing review and investigations by the Audit Committee of financial reporting and other matters.” On this news, the Company’s stock price fell $0.05, or 5%, to close at $0.89 per share August 16, 2023, on unusually high trading volume. The Company’s stock price continued to fall the next trading session by $0.05, or 5%, to close at $0.84 per share on August 17, 2023.
Then, on August 18, 2023, after trading hours, the Company announced it had entered into a Fifth Amendment to its Amended and Restated Note Purchase Agreement among the Company, Goldman Sachs Specialty Lending Group, L.P. and a purchaser party. Capstone also reported receipt of a notice from the NASDAQ exchange that the Company was not in compliance with listing requirements due to its failure to file periodic financial reports. On this news, the Company’s stock price fell $0.26, or 30%, to close at $0.58 per share on August 21, 2023, on unusually high trading volume.
Then, on September 22, 2023, after trading hours, the Company disclosed that certain financial statements could no longer be relied upon “as a result of apparent errors primarily related to revenue recognition associated with bill and hold transactions that were identified in the course a review by the Audit Committee[.]” The Company disclosed there were “numerous instances where bill and hold transactions did not appear to meet the requirements for revenue recognition under GAAP.”
Then, on September 28, 2023, the Company announced it had filed for Chapter 11 bankruptcy. On this news, the Company’s stock price fell $0.10, or 17%, to close at $0.50 per share on September 28, 2023.
Then, on October 4, 2023, after trading hours, it was announced that the company would be delisted, and the ticker symbol changed from CGRN to CGRNQ.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that the Company had engaged in “bill and hold transactions” with customers; (2) that these transactions were not reported pursuant to generally accepted accounting principles (“GAAP”); (3) that, “as a result of apparent errors primarily related to revenue recognition associated with bill and hold transactions” the Company lacked a reasonable basis to report certain financial results and was reasonably likely to restate its financial statements; and (4) that, as a result of the foregoing, Defendant’s positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
If you purchased or otherwise acquired Capstone securities during the Class Period, you may move the Court no later than 60 days from the date of this notice to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you wish to learn more about this action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Charles Linehan, Esquire, of GPM, 1925 Century Park East, Suite 2100, Los Angeles, California 90067 at 310-201-9150, Toll-Free at 888-773-9224, by email to firstname.lastname@example.org, or visit our website at www.glancylaw.com. If you inquire by email please include your mailing address, telephone number and number of shares purchased.
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