Legal Question in Business Law in Washington

1) What constitutes a meeting of the Board of Directors? I can't find a mention of this anywhere. I ask from the perspective of a minority non-voting shareholder. A non-voting shareholder has certain rights WRT being informed of and receiving minutes from these meetings. But what constitutes a meeting? For example, if a majority of voting shares get together and discuss merger plans over coffee - is that a meeting of the Board? Is it something that has to be formally declared? Can the majority get together and discuss mergers etc. without holding an official Board meeting?

2) I understand shareholders have the right to inspect financials if they have good reason to do so. Regarding Financial Statements the law reads as follows:

"Upon request, the corporation shall promptly deliver to any shareholder a copy of the most recent balance sheet and income statement, which request shall be set forth either (a) in a written record or..."

"Deliver" is defined as follows:

(6) "Deliver" includes (a) mailing, (b) for purposes of delivering a demand, consent, notice, or waiver to the corporation or one of its officers, directors, or shareholders, transmission by facsimile equipment, and (c) for purposes of delivering a demand, consent, notice, or waiver to the corporation or one of its officers, directors, or shareholders under RCW 23B.01.410 or chapter 23B.07, 23B.08, 23B.11, 23B.13, 23B.14, or 23B.16 RCW delivery by electronic transmission.

Does this mean they are required to mail/email/fax the finical statements to me upon my request? Or can they just make them available for my inspection?


Asked on 5/07/12, 7:26 pm

1 Answer from Attorneys
Charles Cruikshank Cruikshank Law Office-Since 1975

You are confusing "What constitutes a meeting of the Board of Directors?" with the rights shareholders have to corporate financial information. The bylaws and state law define the answers. And, shareholders do not have to demonstrate a "good reason" for most of the financials.

Without understanding what it is that you want to accomplish and the details of the target corporation and its structure, defining the best theory to address your goals is not feasible.

What are your goals?

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Answered on 5/08/12, 3:49 pm


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