Washington Code 23B.30.030 – Ratification
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(1) Except as otherwise required by subsection (2) of this section, to ratify a defective corporate action under this chapter, the board of directors must adopt a resolution stating:
Terms Used In Washington Code 23B.30.030
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Date of the defective corporate action: means the date the defective corporate action was purported to have been taken, or, if the exact date is unknown, the approximate date thereof. See Washington Code 23B.30.010
- Defective corporate action: means (a) any corporate action purportedly taken that is, and at the time such corporate action was purportedly taken would have been, within the power of the corporation, but is void or voidable due to a failure of authorization, and (b) an overissue. See Washington Code 23B.30.010
- Failure of authorization: means the failure to authorize, approve, or otherwise effect a corporate action in compliance with the provisions of this title, the articles of incorporation or bylaws of the corporation, a corporate resolution, or any plan or agreement to which the corporation is a party, if and to the extent such failure would render such corporate action void or voidable. See Washington Code 23B.30.010
- person: may be construed to include the United States, this state, or any state or territory, or any public or private corporation or limited liability company, as well as an individual. See Washington Code 1.16.080
- Putative shares: means the shares of any class or series of the corporation (including shares issuable upon exercise of rights, options, warrants, or other securities convertible into shares of the corporation, or interests with respect thereto) that were purportedly created or issued as a result of a defective corporate action, that:
Washington Code 23B.30.010
(a) The defective corporate action to be ratified and, if the defective corporate action involved the purported issuance of putative shares, the number and class or series of putative shares purportedly issued;
(b) The date of the defective corporate action and, if the defective corporate action involved the purported issuance of putative shares, the date or dates on which the putative shares were purportedly issued;
(c) The nature of the failure of authorization with respect to the defective corporate action to be ratified; and
(d) That the ratification of the defective corporate action is approved.
(2) To ratify a defective corporate action under this chapter involving the election of the initial board of directors of the corporation under RCW 23B.02.050(1)(b), a majority of the persons who, at the time of the ratification, are exercising the powers of directors must adopt a resolution stating:
(a) The name of the person or persons who first purportedly approved corporate action as initial directors of the corporation;
(b) The earlier of the date on which that person or those persons first purportedly approved corporate action or purportedly were elected as initial directors; and
(c) That the ratification of the election of that person or those persons as the initial directors of the corporation is approved.
(3) If any provision of this title, the articles of incorporation or bylaws, any corporate resolution, or any plan or agreement to which the corporation is a party at the time the resolution required by subsection (1) of this section is adopted, would have required shareholder approval of the defective corporate action to be ratified, either on the date of the defective corporate action or at the time the resolution required by subsection (1) of this section is adopted, for the ratification of the defective corporate action to be approved:
(a) The board of directors must submit the ratification of the defective corporate action for approval by the shareholders in accordance with RCW 23B.30.040;
(b) The board of directors must recommend the ratification of the defective corporate action to the shareholders unless (i) the board of directors determines that because of conflict of interest or other special circumstances it should make no recommendation or (ii) RCW 23B.08.245 applies, and in either case the board of directors communicates the basis for so proceeding to the shareholders; and
(c) The shareholders entitled to vote must approve the ratification of the defective corporate action as provided in RCW 23B.30.040.
[ 2017 c 28 § 3.]