Replies to post #697081 on NorthWest Biotherapeutics Inc (NWBO)

[learningcurve2020]

No, you dopey numbnuts. I'm getting tired of schooling you.

>>Under Delaware law, a controlling stockholder is a stockholder who either (1) controls a majority of the company’s voting power10 or (2) exercises “a combination of potent voting power and management control such that the stockholder could be deemed to have effective control of the board without actually owning a majority of stock.”

>>Another factor that can lead courts to apply enhanced judicial review is the presence of controlling stockholders — stockholders who hold the majority of a company’s vote4 or exercise effective control over the company while holding a sufficient and often substantial nonmajority vote.5 Such substantial voting power may render the other stockholder votes “mere formalities.”

>>asset stripping, wherein the controlling stockholder sells the company’s assets to another company owned by the controlling stockholder at a low price, or the opposite, in which the controlling stockholder forces the company to buy from another company owned by the stockholder at an inflated price.16 Because a controlling stockholder’s “power is difficult to check,”17 directors may fear the loss of their board seats or other benefits if they do not comply with the controlling stockholder’s wishes.18 Thus, the controlling stockholder’s substantial voting power, and the ability that power brings to influence company and board actions, is a primary rationale underlying the controlling stockholder doctrine.

https://harvardlawreview.org/print/vol-133/controller-confusion-realigning-controlling-stockholders-and-controlled-boards/