Alumax Inc. and Consolidated Subsidiaries - Page 95

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          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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