NorthWest Biotherapeutics Inc (NWBO)

[kabunushi]

This is a subtle point regarding stock being offered directly by the company vs transactions in the market. A direct buyer is allowed to buy shares directly from the company with non-public knowledge e.g. something disclosed under an NDA. At the same time, you can't have somebody with non-public knowledge gained from the company buying from other secondary open market participants because the integrity of the public market must be maintained. This means that buyer and seller have to be on the same level in terms of info released or not yet released by the company. Within the public market for shares, all participants are supposed to be operating under the same information released by the company (though a buyer or seller in the open market is free to find out anything using DD and in that way having an information advantage - information advantage between parties on the open market just cannot be secret information released by the company to only one party of the transaction). One might know more than the other but legally that must only through discovery of publically available information.

However it is a different situation when the company sells shares directly to a buyer in a public offering or by a buyer making a buyout bid. In that case the company is allowed to give information that is not public to the direct buyer. Take the case of a buyout - the buyer will surely need to examine the books and anything else, and hence can have any information not yet known in the public market. They are allowed to do that under an NDA. The purpose of the NDA is to ensure info does not leak to only some participants in the public market. In the public market all participants must have the same amount of information available (regarding what info is released by the company). But a party who is going to buy out the company is allowed to have non-public information before making a buyout offer. And that's OK as long as information is equal between the selling company and the buyout buyer. The buyout buyer doesn't have to be on equal information footing as those buying and selling in the open market.

This is subtle point that I'm sure not everybody understands. Not sure my explanation is crystal clear - the point is that the public market is one market and any direct sales by the company to a private buyer is a different market and the information rules are different.