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Ask HN: What disclosure obligations does a private company have to shareholders?
7 points by seattle_spring on July 3, 2019 | hide | past | favorite | 6 comments
I left a company about 3 years ago, and exercised some options immediately after departure.

Since then they've apparently taken funding (which isn't public anywhere), but I haven't received any correspondence from them (about the funding or anything else). Do they have any obligations to keep me updated on happenings within the company, or are they allowed to keep me completely in the dark until they're a public company or experience a change in ownership?



I am not a lawyer, nor do I play one on TV. This isn't legal advice.

There was a case Biederman v Domo, http://online.wsj.com/public/resources/documents/complaint.p... Where, Biederman, a former employee requested financial data to value his shares, as consistent with Inspection of Books and Records Pursuant to 8 Del. C. § 220 - which applies to many DE incorporated, funded startups, but has restrictions.

It's my understanding that Biederman prevailed. He was able to inspect the books and was not muzzled, as per Domo's initial requirements. However, I can't find the decision.


Generally common shareholders have very little information rights. If you’re really curious just send them an email.


The company is extremely tight lipped even to current employees. If I wanted to get any information beyond what they've provided (nothing), I would almost certainly have to get a lawyer. I just wouldn't want to go that route if I knew 100% that they had no obligations to me.


All I’m saying is an email wouldn’t hurt.


Don’t you have a shareholder agreement? I imagine that’s where the obligations of the company would be laid out.


Yes I have some stock forms that are probably 50+ pages long. Was just curious if anyone knows what the standard disclosure rights are. My stake in the company is not worth hiring a lawyer to comb through the legalese unfortunately.




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