Trustees Will Battle AGEC Voting Proxy

University trustees yesterday prepared to fight it out with oric of the nation's biggest electric power and light companies over the question of corporation cumulative voting for directors. The issue, long a burning one between corporate management and minority stockholders, has been recently advocated openly for the first time by the Securities and Exchange Commission.

The management of the $1,000,000,000 American Gas and Electric Company recommended to its stockholders in its annual proxy statement that they vote in favor of cumulative voting. University trustees have decided to vote against the company's proposal.

Stock Worth $1,000,000

Under cumulative voting stockholders have the right to multiply their shares by the number of directors, and then vote the total number of such shares for any one particular nominee. The University, which holds close to $1,000,000 in common stock in the utility company originally voted in favor of management by proxy on the grounds that the company was one of the soundest and best managed in the country When the background of cumulative voting was investigated by the trustees, however, they revoked their original proxy approval and voted against the management's recommendation.

It was found that the S.E.C. had insisted that the giant utility company, which operates in seven leading industrial states, include in its proxy statement a requirement that cumulative voting for directors be not only specified but also recommended.

The University by its action, has precipitated one of the most unusual developments in corporate history of stock holders rights. Usually small stockholder when they read the annul proxy statement vote according to the recommendations of the management.