The shareholders of the Stackhouse Company need to elect nine new directors. The
ID: 2766255 • Letter: T
Question
The shareholders of the Stackhouse Company need to elect nine new directors. There are 980,000 shares outstanding currently trading at $58 per share. You would like to serve on the board of directors; unfortunately no one else will be voting for you.
How much will it cost you to be certain that you can be elected if the company uses straight voting? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
total cost:
How much will it cost you if the company uses cumulative voting? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
total cost:
How much will it cost you to be certain that you can be elected if the company uses straight voting? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
total cost:
How much will it cost you if the company uses cumulative voting? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
total cost:
Explanation / Answer
To get myself elected: Under straight method I need 980000/2+1= 490,001 shares Each share price = 58 My total cost would be =490001*58= 28,420,058 For cumulative voting the no of shares required >(S*X)/(D+1) Where =no of shares voting in the election X =no of directors you want to elect D= no of directors up for election Here S=980000 X=1 D=9 So votes required=980000*1/10= 98,000 So to get elected I need 98001 votes The cost of votes will be =98001*58= 5,684,000
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