Here is the actual contractual agreement that gove

Here is the actual contractual agreement that governs short transactions. Even though it is said that shares are "loaned out" by the owner and that shares are "borrowed" by the short those terms are incorrect. The contract outlines that the actual shares are transferred to the shorts, which gives the shorts beneficial rights to the shares including voting and dividends but under the contract dividends are reimbursed to the "lender". The contract also stipulates that shares will be bought to replace the original shares.

https://www.sifma.org/resources/general/mra-g...nd-msftas/

It's the brokers that are supposed to sort out the owner of record based on the date set by the corporation. Yes they do screw up some times. The person assigned by the corporation to count the votes is given the total count by broker by the DTC. If there is a discrepancy the person in charge of the vote count can go back to individual brokers and have them correct the record of ownership.

ps. You are correct the margin account shares that are loaned are only those bought on margin unless otherwise approved by the shareholder.