Thank you, AdC.

"if the sponsor's number of shares, if voted in one block for one individual, is able to retain the seat, then there is not much to be done except keep asking the sponsor to give up the seat"

So you're saying that apparently the sponsor is voting for himself at each election.

Hm. At each election the sponsor's name always appears on the ballot, and we (the shareholders) are told to vote for four additional officers. So the way it is always presented to us is that the sponsor's presence on the board is inevitable. We aren't given the option either to vote for him or not. He is just always there, an inevitability.

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If there are five directors and the sponsor retains at least 20.01% of the shares, the sponsor's rep is automatically elected. And that's if all shares are voted, which (of course) they aren't.

Even if every single shareholder votes, there is a sixth person running against the sponsor's rep, and the sponsor's shares dip below that 20.01, you cannot hope to see the sponsor's rep defeated until the sponsor's shares dip to around 16.5%:

shareholders split 83.5% among 5 directors (16.7% each director)
sponsor's rep has 16.5%

Hope that sales are brisk.

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Thanks for the info, Batch; very helpful.

Well, I guess the solution is to bring one more officer on board. So technically there will be six board members; but, since the sponsor never comes to board meetings, it will be as if there are five members and deadlocks can thus be avoided.

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GK - Unless your sponsor controls enough shares of his own and/or by proxy to keep voting himself onto the board, or your by-laws give him the right to be on the Board, I see no reason why he has to be on the board.

You said his name is always on the ballot and you're told to vote for 4 BMs. Who creates the ballot? Who's "telling" you to vote for only 4 others? The sponsor, board, mgmt, coop attorney? Who chairs your annual meeting and oversees the election proceedings?

If your sponsor doesn't control enough shares or have the right to be a BM per your by-laws, get more Shs to run for the board and vote him out. If board votes on coop business keep ending in a tie, the sponsor doesn't vote and nothing gets done, that's unproductive. Talk to your mgmt company or attorney and get some straight answers as to why the sponsor is a permanent fixture on the ballot and why you don't have the option to vote him in or out. And get other Shs involved. If you want to get some action on this, you have to take some action.

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BP, thank you, as usual, for your input.

The sponsor owns just under 20% of the shares at this point.

...or your by-laws give him the right to be on the Board...
I've looked again and I see nothing in the bylaws that explicitly gives the sponsor this right. There is one passage that confuses me, though:The president shall be a member of the board, but none of the other officers need be a member of the Board. . . . An officer who is employed by or affiliated with a holder of unsold shares need not be a shareholder.
BP said:You said his name is always on the ballot and you're told to vote for 4 BMs. Who creates the ballot? Who's 'telling' you to vote for only 4 others? The sponsor, board, mgmt, coop attorney? Who chairs your annual meeting and oversees the election proceedings?
It's amazing, isn't it, what people will accept when something is unfamiliar and they are told that that's simply the way things are done. In most aspects of my life, I question just about everything—but it has taken me five years to start peeling away the opaque layers of this co-op. At every annual shareholders' meeting I have attended, ballots are passed out by the managing agent. (In a thread from last spring I talked about how the managing agent "lost" my proxy at the most recent election.) Those who are running for the board are listed with a checkbox next to their names. The sponsor is also listed, but his name is in bold and there is no checkbox. At the first meeting the person next to me said: "Oh, yeah, there are five board members, but you can only vote for four; the sponsor is always assured a seat." And, you know, I thought that was weird and I didn't really get it but I got busy with the rest of my life and didn't think too much about it.

I would like to get some independent advice on this. The board VP and I were just talking today about how we should seek independent legal advice re: a fuel spill that occurred in the building in October. Residents called the managment company to complain of overwhelming fumes; the super perceived that a spill had occurred and notified the management company. But the management company waited a full week to report the spill to the DEC, lied about when the spill occurred (stating that it had occurred just minutes before they called the spill hotline) and cleanup was needlessly delayed. As you can imagine, we're not happy about this, and we feel that we need legal advice. But co-op counsel is employed by the management company. So the board VP and I are concerned that we won't be dealt with honestly. (By the way, I've always been bothered by the fact that the co-op accountant and co-op counsel are both employed by the management company and wonder if that's the norm. Is it the norm? Not to mention that the only board member counsel/accountant/managing agent have any contact with is our problematic BP. I think I'm finally making some inroads into persuading others that this situation needs to change and that there needs to be more transparency.)

Thanks again for your feedback. I am going to push hard for removing the sponsor from the ballot or at the very least making him run for the seat like everyone else.

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