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  "docSlug": "0cee9cc55960",
  "documentTitle": "Generac Holdings, Inc. (GNRC)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2022-06-22 00:00:00",
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  "notes": "Uses a red flag visual to point to the Q4 2021/Q1 2022 period where metrics worsened significantly.",
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      "kind": "callout",
      "text": "November 8, 2021\nWhat did CEO Jagdfeld know before entering into a second 10B5-1 program as dealer growth stopped, margins subsequently collapsed, and working capital and liquidity worsened?",
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      "kind": "callout",
      "text": "What did CEO Jagdfeld know before entering into a second 10B5-1 program as dealer growth stopped, margins subsequently collapsed, and working capital and liquidity worsened?",
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      "kind": "metric",
      "text": "Gross Margin: 31.8%",
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      "text": "Looking carefully, we observe that Generac Chairman & CEO Aaron Jagdfeld entered into a new 10b5-1 stock sale program on November 8, 2021. However, this wasn't disclosed until a Form 4 filing on February 1, 2022. He was still selling stock under his old program enacted on October 30, 2020 through January 3, 2022. While not illegal to have two insider trading programs, the SEC is looking into making modifications to rules that would prohibit such practices. The SEC has identified a concern that insiders enter into multiple 10b5-1 plans at the same time to strategically execute trades under one plan and terminate trades on another to exploit MNPI.",
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      "kind": "quote",
      "text": "SEC Proposes Significant Changes to Rule 10b-5-1 Plans and Introduces New Disclosure Requirements — Sherman & Sterling, Dec 23, 2021",
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      "kind": "source-note",
      "text": "Source: Generac filings, conference calls and Spruce Point analysis\n1) Form 4 showing execution under old plan while new plan enacted\n2) \"SEC Proposes Significant Changes to Rule 10b5-1 Plans and Introduces New Disclosure Requirements\", Sherman & Sterling, Dec 23, 2021",
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      "kind": "table",
      "text": "Key Metrics of Generac Recently Worsening",
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      "kind": "title",
      "text": "Chairman & CEO Sells Stock Under Multiple Trading Programs....",
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