Under cumulative voting rules: There are four board-of-director seats open; 200,000 voting shares of common stock outstanding; minority shareholders control 30% of the voting shares; how many directors can the minority shareholders elect?

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Under cumulative voting, the total number of votes each shareholder has is equal to the number of shares they own multiplied by the number of directors to be elected. Minority shareholders control 30% of 200,000 shares, which equals 60,000 shares. With four directors to be elected, they have 240,000 votes in total (60,000 shares * 4). They can concentrate all their votes on one candidate, ensuring the election of at least one director regardless of how the majority shareholders distribute their votes.

Under Cumulative Voting Rules: There Are Four Board-Of-Director Seats Open;