Corporate Director Election and Cumulative-Voting Requirements in Kentucky
At a glance
| Governing law, entity, election, and scope | Kentucky Business Corporation Act, KRS Chapter 271B; ordinary domestic private business corporation, principally §§ 271B.7-010 through .7-040, .7-210, .7-280, and .8-020 through .8-060 |
|---|---|
| Annual, special, delayed, and court-ordered election route | Annual meeting elects directors; ordinary unanimous written consent is available, and articles may authorize 80% or a higher threshold, but not for cumulative elections. Board, articles/bylaw designee, or default 33⅓% holder demand may call a special meeting. Court route opens after the earlier 6-month/15-month annual delay or an unmet valid special demand (§§ 271B.7-010 through .7-040, 271B.8-030(4)) |
| Nomination, eligibility, advance notice, and ballot | Articles/bylaws may prescribe director qualifications. Kentucky residence and share ownership are unnecessary unless those records require them; no corporation-statute nominee advance-notice, write-in, slate, or ballot- listing rule is stated (§ 271B.8-020) |
| Share voting, classes, series, and voting groups | Default 1 vote per outstanding share regardless of class, subject to articles variation and statutory exclusions. Articles may assign all or specified seats to one or more classes; each such class combination is a separate election voting group (§§ 271B.7-210, 271B.8-040) |
| Plurality, majority, votes-cast, and vote-against standard | Default plurality of votes cast by eligible shares at a meeting with quorum, subject to articles variation; plurality expressly means the individuals with the largest vote totals, up to the number of seats. No private-company statutory vote-against route is stated (§ 271B.7-280(1)) |
| Cumulative-voting default, notice, and allocation | Articles opt-in only. Votes multiply by eligible seats and may be concentrated or distributed; no separate shareholder advance-notice condition is stated. An 80%-or-higher articles-based consent route cannot elect directors cumulatively (§§ 271B.7-040(2), 271B.7-280(2)-(3)) |
| Classified board, staggered term, and holdover | Articles may divide directors into 2 or 3 near-equal groups with corresponding 2- or 3-year successor terms. Otherwise terms end at the next annual meeting; an expired-term director holds over until a successor qualifies or board size decreases (§§ 271B.8-050 through .8-060) |
| Tie, failed election, vacancy, and court relief | Plurality identifies the largest vote totals but states no separate last- seat tie-breaker. Ordinary holdover preserves continuity. Court relief compels a delayed meeting and may tailor electorate, dates, notice, and quorum, but does not declare a vote-count result (§§ 271B.7-030, 271B.7-280(1), 271B.8-050(5)) |
| Public proxy, contest, removal, fiduciary, and transaction boundaries | The ordinary private-company sections state no public vote-against or contested-election branch. Federal proxy and exchange systems, beneficial- owner mechanics, inspectors, removal, ordinary vacancy filling, fiduciary disputes, control arrangements, and transaction votes remain outside this routine election page (§§ 271B.7-280, 271B.8-020 through .8-060) |
Requirements one by one
Meeting, consent, and court routes use different thresholds
KRS § 271B.7-010 requires an annual meeting, and KRS § 271B.8-030 places director elections at the first annual meeting and each annual meeting after that unless terms are staggered. KRS § 271B.7-040 defaults written action to unanimity; the articles may authorize an eighty-percent-or-higher route, but that route expressly excludes a cumulative director election.
KRS § 271B.7-020 lets the board, an articles/bylaw designee, or holders of the default thirty-three-and-one-third percent of votes on the proposed issue call a special meeting. The articles may set a higher or lower percentage. KRS § 271B.7-030 permits a summary meeting order after the earlier six-month/fifteen- month annual delay or after untimely notice or nonperformance of a valid special-meeting demand.
Qualifications and class electorates remain governing-document questions
KRS § 271B.8-020 lets the articles or bylaws prescribe director qualifications. Kentucky residence and share ownership are unnecessary unless those records require them.
KRS § 271B.7-210 ordinarily gives each outstanding share one vote. KRS § 271B.8-040 lets the articles assign all or specified seats to one or more classes, which vote as a separate group for those seats.
Kentucky defines plurality and makes cumulation articles-only
KRS § 271B.7-280 defines plurality as the individuals with the largest vote totals, up to the maximum number of seats. The articles may change that default. Cumulative voting also requires articles language; eligible votes multiply by eligible seats and may be concentrated or distributed. The section states no separate shareholder advance-notice condition.
The defined plurality rule does not supply a separate last-seat tie-breaker. KRS § 271B.7-030 lets a court create the delayed meeting and tailor its electorate, record date, notice, and quorum, but does not direct the court to declare an election result.
Classification changes the term calendar, while holdover continues service
KRS § 271B.8-060 lets the articles divide directors into two or three near- equal groups with corresponding two- or three-year successor terms. KRS § 271B.8-050 otherwise ends terms at the next annual meeting and continues an expired-term director until a successor is elected and qualifies or board size decreases.
What trips people up
The articles-authorized eighty-percent consent route is not a substitute for a cumulative-voting meeting. Kentucky expressly carves that election out of the less-than-unanimous consent option.
Plurality means the top vote-getters, not a majority of votes cast. Articles variation and cumulative-vote authorization are separate drafting choices.
Statutes and sources
- Kentucky Legislature, § 271B.7-010
- Kentucky Legislature, § 271B.7-030
- Kentucky Legislature, § 271B.7-040
- Kentucky Legislature, § 271B.7-280
- Kentucky Legislature, § 271B.8-020
- Kentucky Legislature, § 271B.8-050
- Kentucky Legislature, § 271B.8-060
Source links
Every statute quoted above, linked, with the date we checked it.
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