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Posted On: 09/24/2021 8:16:57 AM
Post# of 148900
I don't have access to the article other than the preview portion of it, which says:
Does this mean that if the hostile takeover group obtains control of more than 1/2 of the board, they plan to fire the remaining board members "without cause" to obtain total 100% control? I am not understanding why this restriction is against shareholder rights. If the new group fires a director "without cause" are they not violating the shareholders' rights of those shareholders that voted the director in that they are trying to oust? Will the new group try to stifle access to information in the board meetings (by removing all the other directors) so they can run roughshod over everyone else thereafter? Again, how is a "with cause" requirement against shareholder rights? Maybe someone with full access to the article can shine more light on this.
Quote:
Two stockholders in late-stage biotech venture CytoDyn Inc. sued the company in Delaware Chancery Court late Wednesday in a challenge to the company's "for cause only" restriction on director removals, in the latest in a run of bitter litigation over company control. The suit noted that the provision violates Delaware's general corporation law, and it joins a recent spate of suits contesting alleged company attempt to snuff dissident stockholder objections to director compensation, board nomination requirements and overall management. Shareholders Robert Schielke and Louis J. Schielke said in their suit that CytoDyn and companies like it, no exception applies to the...
Does this mean that if the hostile takeover group obtains control of more than 1/2 of the board, they plan to fire the remaining board members "without cause" to obtain total 100% control? I am not understanding why this restriction is against shareholder rights. If the new group fires a director "without cause" are they not violating the shareholders' rights of those shareholders that voted the director in that they are trying to oust? Will the new group try to stifle access to information in the board meetings (by removing all the other directors) so they can run roughshod over everyone else thereafter? Again, how is a "with cause" requirement against shareholder rights? Maybe someone with full access to the article can shine more light on this.
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