Question

Question: The Beasley Corporation has been experiencing declining earnings but has just announced a 50 percent salary increase for its top executives. A dissident group of stockholders wants to oust the existing board of directors. There are currently 14 directors and 32,500 shares of stock outstanding. Mr. Wright, the president of the company, has the full support of the existing board. The dissident stockholders control proxies for 15,001 shares. Mr. Wright is worried about losing his job.

b. How many shares (or proxies) are needed to elect nine directors under cumulative voting?

Short answer

The number of shares required to elect nine directors is 45,501 shares.

Step-by-step solution

Information provided in the question

Number of directors to be elected = 9

Shares outstanding = 32,500 shares

Total number of directors = 14

Calculation of the number of shares required to elect 9 directors

The number of shares required is 45,501 shares.