SENATE BILL REPORT

                   SB 5107

              As Reported By Senate Committee On:

               Law & Justice, February 24, 1997

Title:  An act relating to consent provisions under the Washington business corporation act.

Brief Description:  Modifying consent provisions under the Washington business corporation act.

Sponsors:  Senators Roach and Johnson.

Brief History:

Committee Activity:  Law & Justice:  1/27/97, 2/24/97 [DPS].

SENATE COMMITTEE ON LAW & JUSTICE

Majority Report:  That Substitute Senate Bill No. 5107 be substituted therefor, and the substitute bill do pass.

  Signed by Senators Roach, Chair; Goings, Haugen, Kline, Long, McCaslin, Stevens and Zarelli.

Staff: Mal Murphy (786-7412)

Background:  Current law does not allow for the non-unanimous written consent by a corporation=s shareholders to any action where their consent is required.

Summary of Substitute Bill:  Corporate action may be authorized or taken by the non-unanimous written consent of the shareholders of a nonpublic company, where provision is made for such consent in the articles of incorporation.

Provisions relating to target corporations engaging in significant business transactions are clarified.

Substitute Bill Compared to Original Bill:  The substitute requires the notice be given to all shareholders before a corporation can take action by less than unanimous consent.

Appropriation:  None.

Fiscal Note:  Not requested.

Effective Date:  Ninety days after adjournment of session in which bill is passed.

Testimony For:  The bill will allow flexibility so small corporations can take advantage of emerging business opportunities, and makes our law consistent with that of Delaware.  Also cleans up ambiguity in anti-takeover provisions of corporation law.

Testimony Against:  None.

Testified:  Kent Carlson, WSBA, Corporate Act Revision Committee.