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    Stockholders voting shares under cumulative voting

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    Midland Petroleum is holding a stockholders' meeting next month. Ms Ramsey is the president fo the company and has the support of the existing board of directors. All members of the board are up for reelection. Mr. Clark is a dissident stockholder. He controls proxies for 40,001 shares, Ms. Ramsey and her friends on the board control 60,001 shares. Other stockholders, whose loyalties are unknown, will be voting the remaining 19,998 shares. The company uses cumulative voting. How many directors can Mr. Clark be sure of electing? How many directors could Mr. Clark elect if he obtains all the proxies for the uncommitted votes? Will he control the board?

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    Solution Preview

    a) N=X(D+1)/S
    X 40001
    S 120000
    Here D is not provided. Assume that there are 11 members in in board of ...

    Solution Summary

    This solution determines how many directors to the board a stockholder can be sure of electing at an AGM given different circumstances.