A. Unless the terms of the trust instrument expressly provide otherwise, a trustee who has the discretion under the terms of a testamentary instrument or irrevocable inter vivos agreement to make distributions, regardless of whether a standard is provided in the trust instrument to or for the benefit of a beneficiary of the trust, may exercise without prior court approval the trustee's discretion by appointing part or all of the trust property in favor of a trustee of another trust if the exercise of this discretion:
1. Does not reduce any fixed nondiscretionary income payment to a beneficiary.
2. Does not alter any nondiscretionary annuity or unitrust payment to a beneficiary.
3. Is in favor of the beneficiaries of the trust.
4. Results in any ascertainable standard applicable for distributions from the trust being the same or more restrictive standard applicable for distributions from the recipient trust when the trustee exercising the power to appoint trust property described in this subsection is a possible beneficiary under the standard.
5. Does not adversely affect the tax treatment of the trust, the trustee, the settlor or the beneficiaries.
6. Does not violate the limitations on validity under sections 14-2901 and 14-2905.
B. This section applies to a trust governed by the laws of this state, including a trust whose governing jurisdiction is transferred to this state.
C. The exercise of the trustee's power to appoint trust property under subsection A of this section is considered to be the exercise of a special power of appointment.
D. The trustee, in the trustee's sole discretion, before or after the exercise of the trustee's power to appoint trust property under subsection A of this section, may request the court to approve the exercise.
E. The trustee may exercise the power to appoint all of the trust property pursuant to subsection A of this section by restating the trust instrument.