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Irrevocable Proxy: Definition, Terms, Example

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What is an Irrevocable Proxy?

An irrevocable proxy is a contract between a principal and an agent in which the principal gives representation rights to the agent. Proxy agreements are used in a variety of industries but are commonly executed when a shareholder appoints a proxy to exercise voting rights within a corporation. Usually a proxy is revocable, however an irrevocable proxy includes language in the contract that prohibits revocation for an agreed upon amount of time. Certain circumstances that make a proxy irrevocable include:

  • If the proxy is already a shareholder of the company
  • The proxy has an employment contract with the company
  • The proxy has advanced credit to the company

Common Sections in Irrevocable Proxies

Below is a list of common sections included in Irrevocable Proxies. These sections are linked to the below sample agreement for you to explore.

Irrevocable Proxy Sample

Exhibit 10.6

 

[FORM OF] IRREVOCABLE PROXY

 

In accordance with the Securities Purchase Agreement (the “Agreement”) by and among Solomon Technologies, Inc., a Delaware corporation, and certain Investors, as designated in the Stock Purchase Agreement, dated April 15, 2004, the undersigned agrees as follows:

 

1. Grant of Irrevocable Proxy.

 

(a) The undersigned stockholder (the “Stockholder”) with respect to all of the shares (the “Shares”) of Series A Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”) owned by the Stockholder in Solomon Technologies, Inc., a Delaware corporation, (the “Company”) hereby grants to Woodlaken, LLC, a Connecticut limited liability company, (the “Holder”) an irrevocable proxy under Section 212 of the Delaware General Corporation Law to vote the Shares in any manner that the Holder may determine in its sole and absolute discretion to be in the Holder’s own best interest, all of the Shares with respect to which the Stockholder has voting power at the date hereof at any meeting of stockholders of the Company or action by written consent with respect to any matter or the transactions contemplated thereby; provided, however, that the rights granted by the Stockholder to the Holder contained herein shall not permit the Holder to vote, and the Stockholder reserves the right to vote, the Shares with respect to any proposal to amend, delete or waive any rights of the Stockholder under Section 7, Preemptive Rights, in the Amended and Restated Certificate of Designation of Series and Determination of Rights and Preferences of Series A Preferred Stock of Solomon Technologies, Inc. It is expressly understood and agreed that the foregoing irrevocable proxy is hereby granted to the Holder by the Stockholder pursuant to the Agreement and is coupled with an interest.

 

(b) Because of this interest in the Shares, the Holder shall have no duty, liability and obligation whatsoever to the Stockholder arising out of the exercise by the Holder of the foregoing irrevocable proxy. The Stockholder expressly acknowledges and agrees that (i) the Stockholder will not impede the exercise of the Holder’s rights under the irrevocable proxy and (ii) the Stockholder waives and relinquishes any claim, right or action the Stockholder might have, as a stockholder of the Company or otherwise, against the Holder or any of his affiliates in connection with any exercise of the irrevocable proxy granted hereunder.

 

(c) The Stockholder has the right to notice of or to any and all special and general meetings of stockholders during the term of this Irrevocable Proxy and further severally agrees that if any notice is given by the Company to the Stockholder, such notice will be deemed to have been validly given to the Stockholder for all purposes.

 

(d) This irrevocable proxy shall expire as to those Shares on the date that such Shares are converted into Common Stock on the Company, but shall continue as to any Shares not so converted.

 

2. Legend. The Stockholder agrees to permit an appropriate legend on certificates evidencing the Shares reflecting the grant of the irrevocable proxy contained in the foregoing Section 1.

 

3. Representations and Warranties. The Stockholder represents and warrants to the Holder as follows:

 

(a) The Stockholder has the all necessary rights, power and authority to execute, deliver and perform his obligations under this Irrevocable Proxy. This Irrevocable Proxy has been duly executed and delivered by the Stockholder and constitutes his legal and valid obligation enforceable against the Stockholder in accordance with its terms.

 

(b) The Stockholder is the record owner of the Shares listed under his name on Appendix A and the Stockholder has plenary voting and dispositive power with respect to such Shares; the Stockholder owns no other


shares of the capital stock of the Company; there are no proxies, voting trusts or other agreements or understandings to which such Stockholder is a party or bound by and which expressly require that any of the Shares be voted in any specific manner other than this Irrevocable Proxy; and such Stockholder has not entered into any agreement or arrangement inconsistent with this Irrevocable Proxy.

 

4. Equitable Remedies. The Stockholder acknowledges that irreparable damage would result if this Irrevocable Proxy is not specifically enforced and that, therefore, the rights and obligations of the Holder may be enforced by a decree of specific performance issued by a court of competent jurisdiction, and appropriate injunctive relief may be applied for and granted in connection therewith. Such remedies shall, however, not be exclusive and shall be in addition to any other remedies which the Holder may otherwise have available.

 

 


[name]

 

APPENDIX A

 

Certificate Number


 

Number of Shares


     ]

       ]

 

2


Reference:
Security Exchange Commission - Edgar Database, EX-10.6 9 dex106.htm FORM OF IRREVOCABLE PROXY, Viewed November 10, 2021, View Source on SEC.

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