Grayscale Litecoin Trust (LTCN) presents four proposals in a definitive proxy seeking shareholder consent to amend the Trust Agreement. The changes would (1) permit the Sponsor to enable creation and redemption of Baskets in cash under specified procedures, (2) change the Sponsor's Fee mechanics so the fee (accruing at an annual rate of 2.5% of the LTC Holdings NAV Fee Basis Amount) is payable daily in arrears (payable in LTC or, in some instances, Incidental Rights/IR Virtual Currency), (3) permit portions of the Trust Estate to be held in omnibus accounts (enabling use of a Prime Broker affiliated with the Custodian) to facilitate creations/redemptions, and (4) give the Sponsor broad authority to restate, amend or supplement the Trust Agreement without prior shareholder consent, provided that any amendment the Sponsor deems materially adverse will not be effective earlier than 20 calendar days after notice and certain amendments affecting grantor-trust tax status require a tax counsel opinion or other conditions. The Trust Agreement retains provisions limiting Trustee liability, indemnifying Covered Persons, and preserving the Trust's objective to be treated as a grantor trust for U.S. federal income tax purposes.
Grayscale Litecoin Trust (LTCN) preliminary proxy proposes four principal amendments to the Trust Agreement focused on operational flexibility, fee mechanics and governance. Proposal 1 would permit creation and redemption of Baskets for cash under defined procedures, including delivery/return rules, settlement conditions and indemnities for Liquidity Providers and Authorized Participants. Proposal 2 changes the Sponsor's Fee mechanics: the Sponsor's Fee accrues daily at an annual rate of 2.5% of the LTC Holdings NAV Fee Basis Amount and would be payable daily in arrears (the Sponsor retains discretion over withdrawal timing). Proposal 3 permits holding part of the Trust Estate in omnibus accounts and using a Custodian affiliate as a Prime Broker to facilitate creations/redemptions. Proposal 4 grants the Sponsor broad power to restate, amend or supplement the Trust Agreement without shareholder consent, subject to a 20-day notice for amendments deemed materially adverse by the Sponsor and limits tied to maintaining grantor-trust tax treatment (including obtaining counsel or Tax Advisor opinions under specified conditions). The document also details creation/redemption settlement mechanics, trustee indemnities and extensive Sponsor authorities and indemnification provisions.