Shareholder poll: weighting vote rights?

Question

would you be put off from investing in a start up Company which you felt had substantial growth prospects because the two executive directors had limited the power of shareholders in a specific case? Most notably in the form of wieghting votes rights for the 2 directors, which would multiply the directors votes in the event that the majority shareholder would want to get rid of them?

Answer 1

Classic 'cake and eat it' .. sell off more than 50% of the Company, but hang onto more than 50% of the votes ... well good luck to them !

NB. No way would I be subscribing as a 'partner' (for less than my share of the votes) nor in any IPO, however after the event, a few years down the line, any 'funny' voting arrangements are likley to be irrelevant (their record will speak for itself).

Answer 2

If I were to not invest in companies that did not have all of these s***w ball rules to prevent current management from getting the boot,  I would have to put my money in CDs, God forbid.

The real crime is that the SEC does not prohibit such practices; but they are just a management studge orangization anyway.

So what else is new?