Forfeiture. (Destiny)

by narcogen , Andover, Massachusetts, Tuesday, August 19, 2014, 23:02 (3548 days ago) @ Fuertisimo

Am I to interpret this to mean that they tried to take away over 300,000 shares of stock from Marty?

More than that, actually.

Following his termination they forfeited his shares-- apparently the preferred as well as the common.

Then, at a shareholders meeting they held without notifying him (because they had forfeited his shares) they converted ALL of the company's preferred shares (the ones given to founders like O'Donnell) into common shares.

Without having Bungie's foundation documents (charters, etc) it's difficult to know exactly what this means, but it is not much of a stretch to think that someone at Bungie knew the forfeiture would not stand. The injunction the judge granted O'Donnell means he must have his shares returned to him, and if the company cannot issue preferred stock, it can issue him an equivalent value of common stock. This may be relevant as it applies to what voting rights different classes of stock have. How it really benefits the remaining shareholders, I'm not sure, since supposedly all of their preferred stock has also been converted, but unless they are also forced to undo any actions taken at shareholders meetings they held without O'Donnell, it is possible they took other steps not outlined here-- say, issuing other classes of stock, or golden shares, or something else similar that they might later argue they do not owe O'Donnell.

Given the remark that Destiny's release is relevant to the vesting of shares, this looks less and less like an employer/employee dispute and more like a struggle for control of the company.

For the record, IANAL.