Voting Trusts . . .

are agreements used to transfer control from management to an investor if the company does not meet its goals. They work by placing management’s stock in a trust with the investor’s shares. The trustee is instructed to vote the entrusted shares as the venture capitalist directs if the company fails to meet its goals. Voting trusts are the exception, not the rule, these days. See: Benchmarks, Control, Take Away Provisions, Voting Agreements.