Late April, 1998.
On the third day after the Celtics were swept in the first round.
Gaston, amidst the wrath of the entire Boston, submitted a restructuring and buyback plan to the NYSE and the Securities and Exchange Commission.
At the time, the Boston Celtics were the only professional sports team in the United States listed on the New York Stock Exchange. To raise funds, the elder Gaston converted 40% of his shares into stock and sold it to the citizens of Boston. However, under this listed partnership structure, these individual shareholders only had the right to receive dividends and had no veto power over the restructuring. Gaston held nearly 60% absolute control, and the restructuring plan could be approved as long as he signed it.
The votes of public shareholders are meaningless and cannot take away Gaston's control.
However, they can obstruct and delay the achievement of a restructuring plan.
Gaston is pushing this restructuring plan so hard now because the regulations that allowed him to evade taxes have been repealed. Under the new regulations, if he doesn't complete the restructuring by June 30, he will have to pay the Internal Revenue Service a hefty $28 million in back taxes.
The following morning, a cold rain fell in Boston.
A light, gray drizzle clung to the floor-to-ceiling windows of the office building, making one feel suffocated.
The protesters outside the FleetCenter Arena were holding umbrellas and plastic bags, and their signs were clearly written on them.
Don't steal our team.
[Bury the houses first, then buy the land.]
[ Pitino deliberately lost the game!]
[Buy now at a bargain price in Gaston!]
[The sweeping defeat was not an accident, it was premeditated!]
We can lose the playoffs, but we can't let you treat us like lambs to the slaughter!
Give us back our Celtics!
The streets were lined with broadcast vans from various television stations.
These people were all mobilized by Matt Damon last night.
On a local television program last night, Matt Damon laid out the timeline of Gaston's reorganization application, giving a public account of the situation.
Ordinary fans initially didn't understand what a rebuild was, but Damon guided the discussion very cleverly on television: he didn't say it explicitly, but hinted at it to the whole city.
He meticulously connected Pitino's disastrous on-court management and post-game blame-shifting with the Celtics ' rapid stock price plunge, and Gaston's submission of a restructuring plan at the lowest point. Everyone could understand his meaning...
Pitino acted like a fool, completely working to help his boss buy up the shares held by Boston citizens at a low price.
Although not explicitly stated, the implied meaning was crystal clear, igniting the anger of fans across the city, leading to a large number of people rushing to block the stadium early this morning.
The streets were lined with broadcast vans from various television stations.
This forced restructuring, which was caught in a loophole in the Partners Act, should have gone unnoticed, and most retail investors would have just had to accept their bad luck. But Matt Damon's meddling has made it known to almost everyone in Boston.
Matt Damon didn't go to the scene to chant slogans today; he sent his legal team instead.
At 9:20 a. m., the Suffolk County Court received a thick joint application, with Matt Damon listed first among the public minority shareholders. The document was full of legal jargon, but the local media summed it up in four words in their midday news: a temporary injunction.
Upon hearing those four words, David Miller, Gaston's chief lawyer, immediately changed his expression.
" Chris Paul, if it's just a matter of the law, they absolutely cannot beat you."
In a high-rise office downtown, Miller, a core strategist for the Gaston Group, slammed a document on the table and began his analysis urgently.
"Public shareholders can't really take control, the problem is they don't need to win in the end, they just need to stall! Damon's legal team is too cunning. They're not suing for illegal restructuring, they're suing you for 'deliberately suppressing the stock price through mismanagement, suspected self-serving transactions, and breach of fiduciary duty,' and they've applied for a preliminary injunction. Once the judge agrees to review our finances... the restructuring process will be forcibly suspended."
How long will the pause last?
"It will take at least twenty days. That means..."
"In other words, it will definitely be delayed past June 30th." Gaston's obese body suddenly stiffened, and he almost dropped the cigar in his hand.
The CFO of the Gaston Group, sitting opposite him, turned pale and quickly followed up with another sarcastic remark.
" Chris Paul, we can't afford to delay even a day longer! Besides the $28 million in back taxes from the Internal Revenue Service, the $40 million bridge loan you took out from Wall Street for this share buyback also has a deadline of June 30th. If we delay past that date, the loan won't be converted to a long-term low-interest rate on time, and it will directly trigger punitive interest rates—those are usurious loans that accrue interest every day! It's like we're losing $500,000 every day after the deadline! The longer we delay, the more we lose... In the end, Wall Street banks will just freeze the team shares you've pledged!"
Gaston gritted his teeth.
Matt Damon's side doesn't need to win at all; he just needs to run out of time, and the Internal Revenue Service and Wall Street can work together to strangle Gaston.
The Boston Globe featured a very intuitive trend chart on its front page.
The left side shows the team's record over the past few years, and the right side shows the Celtics ' stock price curve.
A steep, plunging arrow is drawn in the middle with thick black lines.
The chart was captioned. "If this is a coincidence, it's too much of a coincidence."
At 2 p. m., another major shareholder Chris Paul Dupee, called.
Dupee, a local lawyer and businessman, usually leaves himself an out when he speaks, but today his first sentence shut that out.
" Chris Paul, I can't sign the restructuring documents."
Gaston gripped the receiver, his face twitching slightly. " Dupee, what do you mean? You have to be at the meeting this afternoon."
" Damon's lawyers have added my name and Cohen's name to the defendant list as well," Dupee said in a low but resolute voice on the phone. "In a partnership, general partners bear unlimited joint and several liability. I don't want to be sitting on the witness stand a few years from now, explaining to a judge why we rushed to buy retail shares when the stock price had hit rock bottom. I know legally I'll eventually be fine. But public opinion won't see me as innocent. I'm a Boston native, I'm going to live the rest of my life here, and I don't want to go out and be spat on."
Before Gaston could even swear, the call was disconnected. Immediately afterward, another secure phone rang.
Allen Cohen, a partner with an investment and real estate background, speaks even more bluntly and coldly Dupee.
" Wall Street and banks have been asking me all day about the regulatory risk of the restructuring being frozen by the court. Chris Paul, you have nearly 60% control, which certainly allows us to pass any resolution, but control can't stop a judge from temporarily suspending it, nor can it stop Time from writing about the three of us next week as bastards who steal money from minority shareholders. Not to mention, if the restructuring is found to have opaque related-party transactions and insufficient disclosure, Dupee and I will be pulled in by regulators to assist in the review. Don't expect me to sign off until the fairness opinion is issued."
The phone went dead.
The fire has spread from the stock exchange to the courthouse, and then to the partners'...
Gaston had been hoping that the other two partners would sign off quickly so he could push the restructuring plan through as fast as possible.
Now, things have turned out differently. Seeing that things were going wrong, Dupee and Cohen, in order to avoid taking the blame, have simply become cowards.
For Gaston, their hesitation at this point was no different from outright betrayal.
This is tantamount to stabbing him in the back and draining his blood.
If this drags on, Wall Street and the Internal Revenue Service will really bankrupt him...