Also known as: shareholder voting agreement · shareholders voting agreement · voting agreement · shareholders agreement
Written by attorneys · grounded in primary & secondary sources — see below
A contract among two or more shareholders that specifies how they will vote their shares on designated matters. The agreement creates binding contractual obligations between the signatories that courts may enforce through specific performance.
Solomon Silver, Sarah Sullivan, and Simone Sanders own shares in Sterling Manufacturing. They sign a written agreement committing to vote together against any sale of the company's only factory. When the board later proposes such a sale, Sarah and Simone vote in favor. Solomon obtains a court order requiring them to recast their votes in line with the signed pact.
Sean Steele and Scott Summers control a majority of shares in Starlight Media. They sign voting agreements with a potential acquirer committing to support a proposed merger and granting an irrevocable proxy. After market conditions shift, they attempt to vote against the deal. The acquirer sues and obtains specific enforcement compelling their votes in favor of the merger.
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No. The agreement operates as a private contract among the signing shareholders. It binds only those parties and requires no board approval, bylaw amendment, or corporate filing to take effect.
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Yes. Once two or more shareholders sign a written agreement addressing how they will vote their shares, a court may order a breaching party to cast votes in accordance with its terms rather than awarding only damages.
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A voting agreement is a contract among shareholders that leaves legal title and voting power with each signatory. A voting trust requires transfer of shares to a trustee who then votes them, along with additional formalities such as delivery of a beneficial-owner list to the corporation.
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No. A subsequent purchaser of shares takes subject to a properly executed voting agreement that was disclosed to the corporation, provided the agreement does not impose personal liability or violate public policy.
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…and - Outcalt and Shaw granted to Genesis an irrevocable proxy to vote their shares in favor of the merger agreement. - The voting agreement was specifically enforceable by Genesis. The merger agreement further provided that if either Outcalt or Shaw breached the terms of the voting agreements, Genesis would be entitled to…