CERTIFICATION OF ENROLLMENT

SUBSTITUTE HOUSE BILL 2560

55th Legislature

1998 Regular Session

Passed by the House February 10, 1998 Yeas 96 Nays 0

Speaker of the

House of Representatives

Passed by the Senate March 5, 1998

Yeas 48 Nays 0

CERTIFICATE

I, Timothy A. Martin, Chief Clerk of the House of Representatives of the State of Washington, do hereby certify that the attached is SUBSTITUTE HOUSE BILL 2560 as passed by the House of Representatives and the Senate on the dates hereon set forth.

President of the Senate

Chief Clerk

Approved

FILED

Governor of the State of Washington

Secretary of State

State of Washington

AN ACT Relating to the powers of trust companies; amending RCW 30.04.280 and 30.53.070; and adding a new section to chapter 30.08 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 30.04.280 and 1996 c 2 s 4 are each amended to read as follows:

No person shall engage in banking except in compliance with and subject to the provisions of this title, unless it is a national bank or except insofar as it may be authorized so to do by the laws of this state relating to mutual savings banks or savings and loan associations. A corporation shall not engage in a trust business except in compliance with and subject to the provisions of this title. A bank shall not engage in a trust business except as authorized under this title. A bank or trust company shall not establish any branch except in accordance with the provisions of this title. Except as authorized by federal law or by another law of this state, a trust company incorporated under the laws of another state, a national trust company or national bank the main office of which is located in such other state, or a federal savings bank the home office of which is located in such other state, shall not be permitted to engage in a trust business in this state on more favorable terms and conditions than the terms and conditions on which trust companies incorporated under this chapter and mutual savings banks engaged in trust business under RCW 32.08.140, 32.08.142, 32.08.210, and 32.08.215 are permitted to engage in trust business in such other state.

NEW SECTION. Sec. 2. A new section is added to chapter 30.08 RCW to read as follows:

Notwithstanding any restrictions, limitations, and requirements of law, in addition to all powers, express or implied, that a trust company has under the laws of this state, a trust company shall have the powers and authorities conferred as of the effective date of this act upon a federally chartered trust company doing business in this state. A trust company may exercise the powers and authorities conferred on a federally chartered trust company after this date only if the director finds that the exercise of such powers and authorities:

(1) Serves the convenience and advantage of trustors; and

(2) Maintains the fairness of competition and parity between state-chartered trust companies and federally chartered trust companies.

As used in this section, "powers and authorities" include without limitation powers and authorities in corporate governance and operational matters.

The restrictions, limitations, and requirements applicable to specific powers or authorities of federally chartered trust companies shall apply to trust companies exercising those powers or authorities permitted under this section but only insofar as the restrictions, limitations, and requirements relate to exercising the powers or authorities granted trust companies solely under this section.

Sec. 3. RCW 30.53.070 and 1994 c 256 s 65 are each amended to read as follows:

(1) The owner of shares of a trust company that were voted against a merger to result in a trust company shall be entitled to receive their value in cash, if and when the merger becomes effective, upon written demand made to the resulting trust company at any time within thirty days after the effective date of the merger, accompanied by the surrender of the stock certificates. The value of the shares shall be determined, as of the date of the stockholders' meeting approving the merger, by three appraisers, one to be selected by the owners of two-thirds of the dissenting shares, one by the board of directors of the resulting trust company, and the third by the two so chosen. The valuation agreed upon by any two appraisers shall govern. If the appraisal is not completed within ninety days after the merger becomes effective, the director shall cause an appraisal to be made. ((~~The expenses of appraisal shall be paid by the resulting trust company.~~))

(2) The dissenting shareholders shall bear, on a pro rata basis based on number of dissenting ((~~shared [shares]~~)) shares owned, the cost of their appraisal and one-half of the cost of a third appraisal, and the resulting trust company shall bear the cost of its appraisal and one-half of the cost of the third appraisal. If the director causes an appraisal to be made, the cost of that appraisal shall be borne equally by the dissenting shareholders and the resulting trust company, with the dissenting shareholders sharing their half of the cost on a pro rata basis based on number of dissenting shares owned.

(3) The resulting trust company may fix an amount which it considers to be not more than the fair market value of the shares of a merging trust company at the time of the stockholders' meeting approving the merger, that it will pay dissenting shareholders of the trust company entitled to payment in cash. The amount due under an accepted offer or under the appraisal shall constitute a debt of the resulting trust company.