Daniel had spent months studying Summit before the acquisition. He knew its revenue by division, the maintenance backlog at its largest facility, the percentage of customers renewing contracts, and the names of several engineers whose work held critical projects together. Carter Meridian Holdings had acquired shares from investors ready to exit after a difficult period, and Daniel had negotiated the board appointment so he could oversee a serious operational review. What he had not expected was a public demonstration of the company's internal culture before he had even reached the elevators.
"I want to begin with what happened downstairs," Daniel said. "It wasn't a minor disagreement between a visitor and security. A valid credential was manually denied, my property was taken, and the chief executive threatened to have me arrested after repeatedly making discriminatory remarks. I'd like a preservation order issued internally and an independent review commissioned today."
"Before we discuss the lobby," Warren said, "there's a matter of corporate continuity."
He produced a document from his folder and slid it toward Eleanor. Silas stopped tapping his pen. Rory drew the pages closer and read with the concentration of a lawyer looking for the difference between a badly drafted provision and a dangerous one. Warren's confidence returned as the seconds passed.
"I authorized that protocol nine days ago," he said. "Under the emergency governance provision in the bylaws, and with the approvals it required at the time. It protects management continuity during an ownership transition. Silas witnessed the execution, and legal administration filed it properly."
Rory looked up. "It is an adopted governance instrument," she said reluctantly. "There may be questions about its purpose and the circumstances of its adoption, but on its face it is presently effective."
The document established a ten-day protection period beginning when a new majority shareholder gained control. During that window, removal of the chief executive or cancellation of the protocol required eight of the ten directors to vote in favor, rather than the simple majority normally sufficient under the company's governance structure. Seven directors had supported Daniel's appointment, but three remained aligned with Warren. Unless one more director changed position, Warren could remain CEO for ten days even as an owner with majority voting control sat at the head of the table.
"Eight votes," Warren said. He leaned back in his chair and studied the directors on Daniel's side. "Not seven. I'm pleased somebody here still understands the importance of procedure."
Eleanor read the signature page. "You prepared this before the buyer was publicly identified."
"That is why it's called planning," Warren replied.
"You prepared it before you claim to have known anything about the buyer at all," Daniel said. "You were ready to block a transition that, by your own account, had not concerned you."
Warren smiled. "You are welcome to prove improper intent. Until then, I am still chief executive, and you cannot remove me on your own."
The directors exchanged glances. One of the three loyalists, Harold Hale, had been brought onto the board after Warren helped his investment partnership secure a lucrative consulting arrangement. Another, Elaine Dorsey, owed her original appointment to a recommendation Warren had made when the board was under pressure to fill a vacancy. The third was Victor Salter, a longtime commercial advisor who had repeatedly defended Warren in private board sessions. Both Hale and Dorsey looked uncomfortable but kept their hands folded.