The New Hampshire Voting Trust Agreement is a legal document that establishes the terms and conditions under which individuals or entities can transfer their voting rights to a designated trustee. This agreement is commonly used when shareholders or members of a corporation, partnership, or trust want to consolidate their voting power and ensure a unified decision-making process. In New Hampshire, there are primarily two types of Voting Trust Agreements: Revocable Voting Trusts and Irrevocable Voting Trusts. Both types serve distinct purposes and have specific legal implications. 1. Revocable Voting Trusts: A Revocable Voting Trust Agreement allows the trust creators to transfer their voting rights temporarily while maintaining the ability to revoke the trust at any time. This arrangement is often used when shareholders or members wish to pool their voting power for a specific event such as a merger, acquisition, or strategic decision-making. The revocable nature of this agreement provides flexibility and control to the trust creators. 2. Irrevocable Voting Trusts: An Irrevocable Voting Trust Agreement, on the other hand, entails a more permanent transfer of voting rights. Once the voting rights are assigned to the trustee, they cannot be revoked by the trust creators. This type of agreement is often utilized by estate planners or individuals seeking to ensure seamless succession planning or long-term voting control within a family or business entity. In both types, the New Hampshire Voting Trust Agreement typically includes various key components and provisions: a. Trustees: The agreement identifies the designated trustee(s) who will hold and exercise the voting rights on behalf of the trust creators. The trustee is typically a neutral party who is entrusted with the responsibility of voting in the best interests of the trust beneficiaries. b. Duration: The agreement specifies the duration of the trust, whether it is for a fixed period or until certain conditions are met. In revocable trusts, the creators can determine the length of the trust, while in irrevocable trusts, it is usually established for a longer period or until specific events occur. c. Voting Powers: The agreement outlines the extent of the voting powers transferred to the trustee, including the right to participate in general meetings, elect directors, approve corporate actions, or vote on other critical matters. d. Beneficiaries: The agreement defines the beneficiaries of the trust, typically the individuals or entities that initially transferred their voting rights. The beneficiaries may or may not have the right to receive any income or profits generated from the trust. e. Termination or Revocation: In revocable trusts, the agreement includes provisions specifying the conditions under which the trust can be terminated or revoked by the creators. This may involve unanimous consent or certain predefined events. Irrevocable trusts, on the other hand, are not easily terminated or revoked without mutual agreement among the beneficiaries. f. Governing Law: The agreement expressly states that it is governed by the laws of the state of New Hampshire, ensuring compliance with local regulations and judicial oversight if any disputes arise. The New Hampshire Voting Trust Agreement serves as an essential tool for shareholders, partners, and trustees to consolidate voting power while maintaining legal and fiduciary obligations. These agreements play a crucial role in maintaining stability, preventing conflicts, and providing a streamlined decision-making process within business entities or family-owned enterprises in New Hampshire.
New Hampshire Voting Trust Agreement
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While the proxy may be a temporary or one-time arrangement, often created for a specific vote, the voting trust is usually more permanent, intended to give a bloc of voters increased power as a groupor indeed, control of the company, which is not necessarily the case with proxy voting.
A voting trust is a contract between shareholders in which their shares and voting rights are temporarily transferred to a trustee. A voting agreement is a contract in which shareholders agree to vote a certain way on specific issues without giving up their shares or voting rights.
The Voting Trust shall either be treated as a grantor trust under subpart E, part I of subchapter J of the Internal Revenue Code of 1986, as amended, or shall be treated as merely a custodial arrangement that is not an entity recognized for U.S. federal tax purposes, and the provisions of this Agreement shall be
Voting agreements are commonly used in business combination transactions to ensure the buyer that significant equity holders will vote to approve the subject transaction. A voting agreement may also include an irrevocable proxy.
A voting trust certificate is a document used to give temporary voting control over a corporation to one or several individuals. It is issued to a shareholder and represents the normal rights of any other stockholder, such as receiving quarterly dividends in exchange for their common shares.
If the agreement is validly executed, any party to the agreement can sue for specific performance of the agreement if another party refuses to abide by the agreement. If a suit for specific performance is successful, the court will order the parties to vote the shares in accordance with the voting agreement.
It is imperative to note that the voting rights agreements are valid only between the shareholders. One can elect directors at annual or special meetings and express their opinions to company management and directors on important topics that could influence the value of their shares.
A voting trust certificate is a document issued by a limited-life trust of a corporation established to give temporary voting control of a corporation to one or a few individuals.