- 87 -
Lighting Co. v. Commissioner, supra, did find that the preferred
stock involved there had the right to vote on many matters,
including "any increase of the capital indebtedness", that matter
is not one of the matters involved in the present case. More-
over, unlike the Alumax board management matters over which the
parties disagree regarding their impact for purposes of section
1504(a)(1) and which did not require a stockholder vote or
approval under Delaware law, an increase in the capital indebted-
ness of ELC was, according to the court in Erie Lighting Co., one
of the matters that are "usually reserved to the stockholders".
Erie Lighting Co. v. Commissioner, 93 F.2d at 885. The court in
Erie Lighting Co. did not consider any of those stockholder
matters to be a restriction on the power of the ELC board. To
the contrary, that court found that under the applicable State
law and ELC's bylaws the board of directors of ELC was entrusted
with the management of its business and affairs, and it did not
mention any management matter that it believed was taken away
from that board by those stockholder matters. Id.
On the record before us, we find that the mandatory dividend
provision impacts the voting power of the Alumax class C common
stock for 1984 for purposes of section 1504(a)(1) and for 1985
27 (...continued)
effect of any such right on whether the ELC preferred stock was
voting or nonvoting stock and did not reach its holding on the
basis of any such right.
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