I agree with you about the limits of their power. It's the liquidation preference inherent in a preferred class of stock that is problematic should the company be forced in default of credit agreements, which can include debt obligations, accounts payable, utilities, rental agreements, contracts requiring payment performance, salaries, etc.
If such an event materializes companies are forced to seek creditor protection under the various laws of bankruptcy. That's were liquidation issues rise to the surface and place debtors in charge of the company's assets, with all series of preferred shareholders next. Such an event is very highly likely to leave no assets for the common shareholders
The inability to pay for filing, accounting and other fees is a serious sign that SLS just MAY possibly be close to such an event, giving rise to the preferential postion of SLS creditors and preferred.
JG is in control until SLS defaults on something as small as payroll, then come the lawyers, creditors and preferreds. I assert that the likelyness of such an event is growing. Yet without financial reporting, one cannot confirm that this very common and likely scenario will be avoided.
JMHO
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