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I partly agree with you but this is a separate issue. Whether or not the cap table is known is unrelated to the legality of deliberately driving all common hold
by staticautomatic 7y ago
I partly agree with you but this is a separate issue. Whether or not the cap table is known is unrelated to the legality of deliberately driving all common holders to (or near) zero in the way described by the parent comment.
- lumost 7y agoA party has to know they were wronged to file a lawsuit, if the cap table isn't presented as information related to the contract then the employee has no basis to understand whether they got their rightful share or not. Many companies don't disclose the total shares outstanding either, so it would be unlikely the employee could check for other forms of dilution. Without sounding too conspiratorial, as long as the payouts pay everyone with enough information to figure out that the company was restructured prior to the sale then there really isn't anyone with reason or evidence to sue.
- staticautomatic 7y agoI think you're overstating the importance of the cap table in the scenario outlined by the parent poster. If you're asserting that no one could know they got screwed in that situation without having seen the cap table, then I think you're wrong. The cap table has nothing to say about the company suddenly issuing a bunch of new shares, let alone with the exclusive purpose of screwing certain shareholders.