Asked by Alawia Alawi on Apr 24, 2024
If three seats on the board of directors are up for election, cumulative voting on common stock allow stockholders to:
A) cast one vote per share owned for three different candidates.
B) cast up to three votes per share owned for any one candidate.
C) save votes from a prior board of directors' election and cast them in the current election.
D) cumulative voting only applies to preferred stock.
E) None of the above are true
Cumulative Voting
A voting system that allows shareholders to allocate all of their votes to one candidate, enhancing minority shareholders' chances of influencing board election outcomes.
Board of Directors
A group of individuals elected by shareholders to oversee the major decisions and policies of a corporation.
Common Stock
A form of corporate equity ownership, a type of security that represents ownership in a corporation, entitling the owner to a proportion of the company's assets and profits.
- Understand the concept of cumulative voting and its impact on shareholder power.
Learning Objectives
- Understand the concept of cumulative voting and its impact on shareholder power.