Voting Trust

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Voting Trust

A trust that common shareholders create in order to combine their votes at the annual meeting. Each shareholder transfers his/her voting rights to the trust, while retaining title to the dividends and other rights associated with the stock. The voting trust receives legal title to the common stock and issues voting trust certificates, representing the other rights of common stock, to shareholders. The voting trust uses these shares to vote as a block. This gives participating shareholders a degree of control over the company that they would not otherwise have. Typically, a voting trust can only exist for a certain period of time, depending on the laws of the state in which the company is incorporated.
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References in periodicals archive ?
Voting trusts were populated by powerful, experienced monitors who sought to protect the interests of both bondholder and stockholder.
Cushing, Voting Trusts: A Chapter in Modern Corporate History (New York, 1927), 15.
The voting trust was first used in connection with the railroad consolidations and reorganizations between the Civil War and 1880, but not until the late eighties and nineties was it popularized by the railroad reorganizations of the period.
The purpose of the voting trust was clear: to create a vigilant and active set of monitors to safeguard investors' interests.
Ordinarily, the object aimed at in a voting trust has been the protection of bondholders, not indeed by actually improving in any technical manner the status of their securities, but chiefly by procuring for them such practical advantage as may arise from a well considered conduct of a corporation's affairs.(69)
It is rather noteworthy that the voting trustees appear to be little concerned to give prominence to their own part in the work [putting] 'this large concern on its feet.' It would be difficult to find a stronger list of names than that comprising the voting trust, it consisting of J.
The most obvious symbol of the new regime was the voting trust, which sought to provide a more effective monitoring vehicle than a host of dispersed shareholders.