Voting Trust Vs Voting Agreement

There are several reasons why shareholders may want to enter into a voting escum agreement. In general, unless the articles or articles of the corporation provide otherwise, your agent may be any other person and does not have to be another shareholder of the corporation. Under the laws of most states, you give your attorney an “explanation of vote” that includes all the information required by state law for a proxy. The statement generally includes your name and the number of shares you hold, the name of the proxy and the length of time the proxy is entitled to vote for you. You and your agent keep copies of the voting statement, and a third copy usually goes to the corporation. the agreement should be prominently reflected on the certificate; Otherwise, the agreement will not be applicable to a valuable buyer who will purchase the shares without knowledge of the agreement. However, a person who receives the stock by gift or succession is bound by the agreement as soon as he becomes aware of it. It is important to note that these voting agreements are only valid between shareholders with respect to shareholder votes. They are illegal between directors and should not be used by shareholders to restrict the exercise of directors` discretion. Such agreements may also be unenforceable if they constitute a mere purchase of votes.

In individual voting, shareholders exercise little power and may not perform specific functions that large shareholders can perform. A voting Trust Certificate is a document issued to a shareholder in exchange for the transfer of shares by the shareholder to one or more persons designated as trustees. By accepting this certificate, the shareholder agrees to temporarily entrust a voting trustee with control of his rights and powers in order to make decisions concerning the company without interference. . . .