Legal Definitions - noncumulative voting

Definition: Noncumulative voting is a corporate voting system where a shareholder can only vote for one candidate in a board election, and the number of votes they can cast is limited to the number of shares they own.

Example: If a shareholder owns 100 shares in a company, they can only vote for one candidate in a board election, even if there are multiple seats available. This means that a majority shareholder can elect the entire board of directors.

This example illustrates how noncumulative voting can give more power to majority shareholders and limit the influence of minority shareholders in corporate decision-making.