GT Advanced Technologies and its former CEO have settled allegations that they misled investors about its performance of a contract to supply Apple with sapphire glass for iPhones.

The U.S. Securities and Exchange Commission said GT knew by late April 2014 that it had failed to meet quantity, quality, and delivery standards under the contract, resulting in Apple withholding the final $139 million installment payment and giving it the right to accelerate repayment of the $306 million previously advanced to GT.

But in August 2014, CEO Thomas Gutierrez told analysts in an earnings call that GT expected to receive the final payment by the end of October 2014. Weeks later, the company filed Chapter 11 bankruptcy.

The contract had represented what the SEC called a “game-changing event” for GT that was “material to GT’s revenue and reported liabilities and how its stock was valued.”

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As part of a settlement of civil securities fraud charges, Gutierrez agreed to pay $140,000 in civil penalties, disgorgement and prejudgment interest.

“GT and its CEO painted a rosy picture of the company’s performance and ability to obtain funding that was paramount to GT’s survival while they were aware of information that would have catastrophic consequences for the company,” Anita B. Bandy, an associate director in the SEC’s Division of Enforcement, said in a news release.

GT entered into the contract to supply sapphire glass for iPhone screens in October 2013. The agreement required Apple to advance the $578 million in four installments with each payment being contingent on GT meeting quality and quantity milestones.

But according to an SEC administrative order, the company experienced quality problems from near the start of the contract, including cracks and structural and cosmetic defects that caused the glass to fail to meet Apple’s specifications.

“GT’s expectation of receiving the fourth payment was undermined by its repeated failure to meet performance milestones,” the SEC said.

The commission also faulted GT for failing to disclose it had taken an “unsupported” position that Apple had breached part of the agreement, thus releasing GT from its performance obligations.

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