The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.425, governs the process for a nonprofit corporation to merge with another entity. This statute outlines the requirements for a plan of merger, which must be adopted by the board of directors and then submitted to the members for approval. The board’s resolution must include the name of each merging corporation, the name of the surviving corporation, and the terms and conditions of the merger. For member approval, the plan must typically be approved by a majority of the votes cast by members entitled to vote on the matter, unless the articles of incorporation or bylaws specify a different voting threshold. The Act also mandates that the articles of incorporation of the surviving corporation be amended to reflect the merger, and that a certificate of merger be filed with the Washington Secretary of State. This filing is crucial for the legal effectuation of the merger. Therefore, the primary requirement for initiating a merger under Washington law, after internal board deliberation, is the adoption of a formal plan of merger by the board of directors.

The scenario involves a Washington nonprofit corporation, “Evergreen Shores Preservation Society,” which is a public benefit corporation. A critical aspect of nonprofit governance in Washington is the process for amending articles of incorporation. Under the Washington Nonprofit Corporation Act (RCW 24.03A), amendments to articles of incorporation generally require a resolution adopted by the board of directors and then approval by the members. For a public benefit corporation, RCW 24.03A.420 specifies that amendments require adoption by the board and then approval by the members entitled to vote on the amendment. The question asks about the minimum percentage of member votes required for such an amendment. While specific bylaws can set higher thresholds, the default statutory requirement for member approval of fundamental changes like amending articles of incorporation, unless otherwise specified in the articles or bylaws, is a majority of the votes cast by members entitled to vote on the amendment. This means more than 50% of the votes cast by those eligible to vote on the specific amendment. The question tests the understanding of this statutory default for member approval of articles of incorporation amendments for public benefit nonprofits in Washington.

Washington’s nonprofit law, particularly the Revised Code of Washington (RCW) Title 24, governs the operation of charitable organizations. When a nonprofit corporation in Washington proposes a fundamental change, such as a merger or dissolution, it must adhere to specific procedural requirements to ensure proper governance and protect stakeholder interests. For a merger, RCW 24.03A.405 outlines the process. It mandates that a plan of merger must be adopted by the board of directors and then approved by the members, if the articles of incorporation or bylaws grant members voting rights on such matters. If the articles or bylaws are silent, or if there are no members, board approval alone may suffice for certain actions, but a merger is typically considered a significant corporate event requiring member consent if applicable. The plan itself must detail the terms and conditions of the merger, including how the assets and liabilities of the disappearing corporation will be transferred. Furthermore, the filing of articles of merger with the Washington Secretary of State is the final step that legally effectuates the merger. Failure to follow these steps can render the merger invalid and expose the directors to liability. The question tests the understanding of the necessary approvals for a merger under Washington law, emphasizing the distinction between board and member approval requirements based on the organization’s governing documents.

The scenario describes a situation where a nonprofit corporation in Washington State, governed by the Revised Code of Washington (RCW) Title 24, is considering a significant amendment to its articles of incorporation. Specifically, the amendment aims to change the corporation’s purpose from providing educational services to operating a for-profit subsidiary. Under Washington law, particularly RCW 24.03A.205 (for nonprofit corporations) and related sections governing corporate amendments, such a fundamental change in purpose, especially one that could alter the organization’s tax-exempt status or its fundamental nature, typically requires a higher level of approval than a simple majority of the board of directors. While board approval is always necessary for amendments, the law often mandates member approval, if members exist, or a supermajority vote of the board, particularly for changes that could be deemed fundamental or that impact the organization’s charitable mission. Given the potential shift from a nonprofit educational focus to a for-profit venture, even through a subsidiary, this is considered a material change. RCW 24.03A.205 specifies that amendments to articles of incorporation generally require approval by the board of directors and, if the corporation has members, by the members. However, specific types of amendments, or those that fundamentally alter the corporate structure or purpose, may require a higher threshold, such as a two-thirds vote of the members or a supermajority of the board, depending on the bylaws and the specific nature of the change. Without specific provisions in the bylaws detailing a higher threshold for such a significant purpose change, the default requirement for a fundamental change like this, impacting the core mission and potentially the tax-exempt status, would necessitate a supermajority vote of the board of directors to ensure thorough deliberation and consensus on such a critical strategic shift. The question asks for the minimum required vote of the board for this specific amendment. While member approval is often required if members exist, the question focuses solely on the board’s action. A simple majority of the board (more than 50%) is the standard for many board actions, but a fundamental change in corporate purpose, particularly one that could affect its tax-exempt status or its core charitable mission, often requires a higher threshold, typically a two-thirds vote of the board, to ensure broad agreement on such a significant strategic pivot. This reflects a heightened standard for decisions that alter the very nature of the organization. Therefore, a two-thirds vote of the board of directors is the most appropriate answer to ensure proper governance for such a material amendment.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A, outlines the procedures for amending articles of incorporation. For a nonprofit corporation, an amendment to the articles of incorporation generally requires approval by the board of directors and then by the members. The Act specifies that unless the articles of incorporation or bylaws require a greater vote, an amendment must be adopted by the board of directors and then approved by a majority of the votes cast by members entitled to vote on the amendment. If there are no members or no members with voting rights, the amendment is adopted by the board of directors. In this scenario, the articles of incorporation themselves are being amended to change the corporation’s name and its principal purpose. This is a fundamental change requiring member approval. The bylaws of “Evergreen Arts Alliance” do not specify a higher voting threshold for amendments to the articles of incorporation. Therefore, the default requirement under RCW 24.03A.505 applies, which mandates approval by a majority of the votes cast by members entitled to vote. The board of directors has already approved the proposed amendments. The subsequent step is member ratification. The question asks about the required member vote for this specific amendment. The correct answer reflects the statutory requirement for member approval of article amendments when no higher threshold is specified in the governing documents.

The Washington State Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.235, outlines the requirements for dissolving a nonprofit corporation. A voluntary dissolution can be initiated by the board of directors. The process requires the board to adopt a resolution recommending dissolution, which must then be approved by the members. If the corporation has no members, or if the articles of incorporation or bylaws do not specify a member voting procedure for dissolution, the board’s resolution alone is sufficient for dissolution, provided it is adopted by a majority of the directors then in office. Following board and member approval, articles of dissolution must be filed with the Secretary of State. The Act mandates that before filing the articles of dissolution, the corporation must cease conducting its business, except as necessary to wind up its affairs. This winding-up process includes notifying creditors, collecting assets, and distributing remaining assets according to the articles of incorporation or bylaws, or if not specified, to the members or other designated recipients as permitted by law. The question probes the critical step of ceasing business operations, excluding those necessary for winding up, before the formal filing of dissolution documents. Therefore, the action of discontinuing all business activities, except for those directly related to the dissolution process itself, is a prerequisite to filing the articles of dissolution.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.410, governs the process for a nonprofit corporation to merge with another entity. This section outlines the requirement for a plan of merger to be adopted by the board of directors and then approved by the members. The plan must detail the terms and conditions of the merger, including the method of converting membership interests or interests in the surviving corporation. For a merger to be legally effective in Washington, the plan must be filed with the Secretary of State. RCW 24.03A.415 further specifies that the articles of incorporation of the surviving corporation shall be amended to include the name of the merged corporation and any other details required by the plan. The question tests the understanding of the necessary steps and approvals required for a valid merger under Washington law, focusing on the procedural requirements that ensure corporate governance and member rights are respected. The initial step involves board approval of a detailed merger plan, followed by member approval, and finally, the filing of the plan with the state.

The scenario describes a situation where a nonprofit organization in Washington State, “Emerald City Outreach,” is considering a significant expansion of its services, which would require substantial new funding. The board of directors is deliberating on the most appropriate method for securing this capital. Washington State law, specifically the Revised Code of Washington (RCW) concerning nonprofit corporations, outlines various governance and financial responsibilities. A key aspect of nonprofit governance is the fiduciary duty of directors, which includes the duty of care and the duty of loyalty. When considering major financial decisions, such as taking on significant debt or launching a capital campaign, directors must act in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner they reasonably believe to be in the best interests of the corporation. This involves conducting thorough due diligence, exploring all reasonable alternatives, and documenting the decision-making process. For a capital expansion of this magnitude, a comprehensive feasibility study and a well-structured fundraising plan, potentially including a mix of grants, individual donations, and possibly a low-interest loan from a mission-aligned financial institution, would be prudent. The directors must ensure that any financial strategy aligns with the organization’s mission and does not jeopardize its long-term financial stability. The decision-making process should involve open discussion, consideration of expert advice (e.g., financial consultants), and a clear understanding of the risks and benefits associated with each funding option. The core principle is that directors must make informed decisions that serve the best interests of the nonprofit and its beneficiaries.

Washington State law, specifically Revised Code of Washington (RCW) 24.03A.210, governs the requirements for a nonprofit corporation to dissolve voluntarily. The process typically involves a resolution adopted by the board of directors, followed by a vote of the members. For a corporation without members, the board’s resolution alone may suffice, provided the articles of incorporation or bylaws do not require member approval. However, if the corporation has members, the dissolution requires approval by two-thirds of the votes cast by the members entitled to vote thereon at a meeting of members, or by a greater percentage if specified in the articles or bylaws. If the corporation has no members or no members entitled to vote, the dissolution must be approved by a majority of the directors. The question posits a scenario where a nonprofit has members and the board unanimously approves dissolution. Without specific information about member approval or provisions in the articles/bylaws, the default statutory requirement for member approval must be considered. Therefore, a resolution adopted by the board of directors, while a necessary first step, is not sufficient on its own to effect voluntary dissolution if the corporation has members who are entitled to vote on such matters. The subsequent step of member approval is critical.

The scenario presented involves a Washington nonprofit corporation’s board of directors considering a substantial asset sale. Washington law, specifically Revised Code of Washington (RCW) 24.03A.400, governs the sale, lease, exchange, or other disposition of all or substantially all of the assets of a nonprofit corporation. For such a transaction to be approved, the Washington Nonprofit Corporation Act requires that the board of directors adopt a resolution recommending the disposition, and that resolution must then be submitted to the members for approval. Member approval typically requires a vote of two-thirds of the members present and voting at a meeting where a quorum is present, or a greater percentage as specified in the articles of incorporation or bylaws. The question tests the understanding of this statutory requirement for member approval in significant asset sales, distinguishing it from routine operational decisions or smaller asset dispositions that might fall within the board’s sole authority. The critical element is the phrase “substantially all of the assets,” which triggers the heightened procedural requirements. Without member approval, the sale is not validly authorized under Washington state law.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A, governs the operations of nonprofit corporations in the state. A critical aspect of this act pertains to the duties of directors, particularly the duty of care and the duty of loyalty. The duty of care requires directors to act with the care that a reasonably prudent person in a like position would exercise under similar circumstances. This includes making informed decisions by gathering sufficient information. The duty of loyalty mandates that directors must act in the best interests of the corporation and its members, avoiding self-dealing and conflicts of interest. When a director has a personal interest in a transaction, that interest must be disclosed, and the transaction must be approved by disinterested directors or members, or be demonstrably fair to the corporation. Failure to adhere to these duties can lead to personal liability for directors. In the given scenario, Director Anya’s involvement in the contract negotiation where her husband’s company is a potential vendor raises a clear conflict of interest. Her failure to disclose this interest and recuse herself from the decision-making process directly violates the duty of loyalty. While the board ultimately approved the contract, the process itself was flawed due to Anya’s undisclosed conflict. The question asks about the most appropriate legal consequence for Anya’s actions under Washington law. The act allows for actions to be brought against directors for breach of duty. The most direct and legally sound consequence for a breach of the duty of loyalty, especially involving an undisclosed conflict of interest, is the potential for personal liability for any damages the corporation incurs as a result of the conflicted transaction, or even voiding the transaction if it proves detrimental.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A, governs the operations of nonprofit corporations in the state. When a nonprofit corporation intends to merge with another entity, the process requires careful adherence to statutory provisions to ensure legal validity and protect the interests of stakeholders, including members, directors, and the public. The act mandates that a plan of merger must be adopted by the board of directors and, depending on the corporation’s articles of incorporation and bylaws, may also require approval from the members. RCW 24.03A.110 outlines the requirements for a plan of merger, which must include, among other things, the name of each corporation party to the merger and the name of the surviving corporation. Crucially, the statute requires that the plan of merger be approved by the board of directors and, if the merger would affect the rights of members or if the articles or bylaws require it, by the members. The filing of the articles of merger with the Washington Secretary of State, as stipulated in RCW 24.03A.115, is the final step that effectuates the merger. Without proper board and, where applicable, member approval, the merger is not legally binding. Therefore, the fundamental step for a Washington nonprofit to initiate a merger is the adoption of a formal plan of merger by its board of directors.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.210, governs the process for amending articles of incorporation. For a nonprofit corporation to amend its articles, the amendment must be adopted by the board of directors and then approved by the members. The board of directors, acting by a majority vote of directors present at a meeting where a quorum is present, can adopt an amendment to the articles. Subsequently, unless the articles of incorporation specify a greater proportion, the amendment must be approved by the members entitled to vote on the matter. Typically, this requires approval by a majority of the votes cast by members entitled to vote, provided a quorum is present. However, if the amendment would materially and adversely affect the rights of a particular class of members, that class must approve the amendment separately, often by a two-thirds vote of that class. The scenario describes an amendment affecting only the rights of Class B members. Therefore, the board’s initial adoption is followed by the specific approval of the Class B members. The question asks about the approval required for an amendment that *only* affects the rights of Class B members. The Act mandates that such an amendment requires approval by the members entitled to vote on the matter, and if it materially and adversely affects a class of members, that class must approve it separately. While the board must adopt it, the critical step for this specific type of amendment is the Class B member approval. The requirement for Class B member approval is a specific provision for amendments that disproportionately impact a particular member class.

The scenario describes a situation where a nonprofit organization in Washington State is considering a significant change to its corporate structure by merging with another entity. This type of transaction requires adherence to specific legal procedures outlined in Washington State law, particularly the Revised Code of Washington (RCW). For a nonprofit corporation, a merger is a fundamental corporate action that necessitates board approval and, typically, member approval if the articles of incorporation or bylaws require it, or if the merger would alter member rights. The RCW provisions governing nonprofit corporations, such as RCW 24.03A.400 through RCW 24.03A.465, detail the process for mergers. This process generally involves the adoption of a merger plan by the board of directors, followed by a vote of the members if required. The plan must include specific details about the surviving corporation, the terms of the merger, and any amendments to the articles of incorporation. Filing the articles of merger with the Washington Secretary of State is the final step that legally effectuates the merger. While the board of directors has the authority to initiate and approve corporate actions, the bylaws or articles of incorporation may grant members the right to vote on such significant matters as a merger, especially if it impacts their membership rights or the organization’s fundamental purpose. Without specific information about the bylaws of the hypothetical organization or the nature of the proposed merger’s impact on members, the most prudent and legally sound approach for the board to ensure compliance and valid approval is to seek member ratification for the merger agreement. This approach preempts potential challenges based on member rights or governance procedures.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.440, outlines the process for dissolving a nonprofit corporation. When a nonprofit corporation voluntarily dissolves, it must file a statement of dissolution with the Secretary of State. Prior to filing this statement, the corporation must cease conducting its activities, except those necessary to wind up its affairs. The winding up process involves collecting assets, paying debts and liabilities, and distributing any remaining assets. RCW 24.03A.445 mandates that after satisfying or making provision for all claims, any remaining assets must be distributed to one or more domestic or foreign corporations or entities described in RCW 24.03A.460(1)(a) and (b), which typically includes other tax-exempt organizations, or to the extent permitted by law and the articles of incorporation, to members if the corporation is a non-membership corporation. Therefore, the distribution of assets to a for-profit subsidiary is generally not permissible under Washington law for a nonprofit corporation undergoing voluntary dissolution, as it contravenes the public benefit purpose for which the nonprofit was established and the statutory requirements for asset distribution upon dissolution. The correct distribution involves assets going to other qualifying tax-exempt entities or, in specific non-membership cases, to members, but not to a for-profit entity for private benefit.

The Washington State Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.245, governs the dissolution of nonprofit corporations. When a nonprofit corporation is dissolved, its assets must be distributed for exempt purposes. This means that any remaining property, after paying debts and liabilities, must be transferred to another organization that qualifies as a public charity or for a charitable purpose. This is a fundamental principle of nonprofit law, ensuring that assets dedicated to public benefit are not diverted to private individuals. Failure to adhere to this distribution requirement can lead to legal challenges and potential loss of tax-exempt status for the distributing entity and the recipient. The process typically involves a vote by the board of directors or members, followed by the filing of articles of dissolution with the Washington Secretary of State. During this winding-up period, the corporation continues to exist solely for the purpose of settling its affairs and distributing its assets. The specific designation of the recipient organization must align with the original charitable purposes of the dissolving entity, or a court may direct the distribution if no suitable recipient can be identified.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.240, outlines the requirements for a nonprofit corporation to dissolve voluntarily. A key aspect of this process involves the adoption of a resolution for dissolution. For corporations that have not yet commenced business or have ceased to conduct business and have no debts or liabilities, the dissolution can be authorized by a majority of the directors then in office. However, if the corporation has commenced business and has debts or liabilities, the dissolution must be authorized by the members. The Act specifies that such member authorization requires approval by at least two-thirds of the votes cast by the members entitled to vote thereon, or if no members are entitled to vote thereon, by the same vote as required to elect directors. This distinction is crucial for ensuring that the assets and affairs of the corporation are properly wound up and distributed according to legal requirements, protecting both creditors and members. The scenario presented involves a nonprofit that has commenced business and has members, thus requiring member approval for dissolution. The critical threshold for member approval, as per RCW 24.03A.240(2)(b), is two-thirds of the votes cast by members entitled to vote.

The Washington State Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.400, outlines the procedures for a nonprofit corporation to dissolve voluntarily. For a nonprofit to dissolve voluntarily, the board of directors must adopt a resolution recommending dissolution, which then must be approved by the members. The Act specifies that for corporations with members, approval typically requires a two-thirds vote of the members present at a meeting where a quorum is present, unless the articles of incorporation or bylaws specify a different voting threshold. If the corporation has no members, or if the articles or bylaws provide for dissolution by the board alone, then board approval is sufficient. The process involves filing articles of dissolution with the Secretary of State after winding up the corporation’s affairs, which includes settling debts, distributing assets to other qualified organizations, and fulfilling other legal obligations. The question probes the understanding of the member approval requirement for voluntary dissolution in Washington State nonprofits, highlighting the common scenario where member consent is paramount unless specific exceptions in governing documents are met. The correct answer reflects the general statutory requirement for member approval, often a supermajority, for voluntary dissolution when members exist.

The scenario presented involves a Washington nonprofit corporation, “Evergreen Futures,” which has received a significant bequest from a donor with specific instructions for its use. The core issue revolves around the board of directors’ fiduciary duties, particularly the duty of loyalty and the duty to manage the corporation’s assets in accordance with its stated mission and donor restrictions. Washington’s nonprofit corporation law, specifically Revised Code of Washington (RCW) 24.03A, governs the actions of nonprofit directors. When a donor places restrictions on a gift, the nonprofit corporation is generally bound to adhere to those restrictions, provided they are lawful and not impossible to fulfill. The board has a duty to ensure that the organization’s activities align with its charitable purpose and any donor-imposed limitations. In this case, the bequest is designated for educational programs for underserved youth in Spokane County. The board’s proposed use of these funds for general operating expenses, even if facing financial difficulties, would constitute a breach of trust and a violation of the donor’s intent. The directors have a duty of care, which includes acting in good faith and with the care an ordinarily prudent person in a like position would exercise under similar circumstances. They also have a duty of loyalty, requiring them to act in the best interests of the corporation and its beneficiaries, not for personal gain or to address unrelated organizational needs. Diverting restricted funds to cover general operating expenses, without following proper procedures for modifying or terminating restrictions (which are rare and typically require court approval or specific provisions in the governing documents or donor agreement), would be a violation of these duties. The proper course of action for the board, if they believe the restricted funds cannot be used as intended or if the organization’s financial health is precarious, would be to explore legal avenues for modifying or terminating the restriction. This might involve petitioning a court under RCW 24.03A.405, which allows for modification or termination of restrictions on gifts if it becomes unworkable or impossible to fulfill. Alternatively, if the donor is still living and agrees, the restriction could be modified by mutual consent. However, unilaterally deciding to repurpose restricted funds for general operating expenses is not permissible under Washington law and would expose the directors to personal liability. Therefore, the board must seek to honor the donor’s intent or obtain legal authorization to deviate from it.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.300, outlines the requirements for a nonprofit corporation to dissolve voluntarily. For a nonprofit to dissolve voluntarily, the board of directors must adopt a resolution recommending dissolution, and then the members, if any, must approve the dissolution. If there are no members, or if the articles of incorporation or bylaws do not provide for member approval, the dissolution only requires board approval. In this scenario, the bylaws of the Evergreen Community Foundation, a Washington nonprofit, clearly stipulate that any dissolution requires a two-thirds vote of the entire membership. Therefore, the board’s unilateral decision to dissolve, without presenting the matter to the membership for a vote, is insufficient to initiate the dissolution process under Washington law and the organization’s own governing documents. The correct procedure necessitates member approval as outlined in the bylaws, which are binding on the corporation.

In Washington State, nonprofit corporations are governed by the Washington Nonprofit Corporation Act, found in Revised Code of Washington (RCW) Chapter 24.04. A critical aspect of this governance involves the process of amending the articles of incorporation. According to RCW 24.04.101, the board of directors may adopt a resolution setting forth the proposed amendment and directing that it be submitted to a vote at a meeting of members. If there are no members, or if the articles of incorporation do not provide for voting by members, the amendment may be adopted by the vote of a majority of the directors. If members are entitled to vote on the amendment, the amendment must be adopted by the affirmative vote of a majority of the votes cast by members entitled to vote thereon at a meeting of members, provided that the meeting was duly called and the notice of the meeting included the proposed amendment. The Act also specifies requirements for notice of meetings where amendments are to be considered. The underlying principle is to ensure proper corporate governance and member or director approval for fundamental changes to the nonprofit’s structure as outlined in its articles.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.225, addresses the process for a nonprofit corporation to dissolve voluntarily. A key requirement for initiating voluntary dissolution is the adoption of a resolution by the board of directors. This resolution must then be submitted to the members for approval. For a Washington nonprofit, the articles of incorporation or bylaws typically specify the voting threshold required for member approval of dissolution. If the articles or bylaws are silent on the matter, the default voting requirement under RCW 24.03A.225(3) is a majority of the votes cast by members entitled to vote thereon at a meeting of members duly called for that purpose. The question posits a scenario where the articles are silent, and a special meeting was called with proper notice. At this meeting, 100 members voted, with 51 in favor and 49 against. Since the articles are silent, the statutory default applies, which is a majority of the votes cast. Therefore, 51 votes in favor constitute a majority of the 100 votes cast, satisfying the requirement for member approval of the dissolution.

The Washington State Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A, outlines the procedures for amending articles of incorporation. For a nonprofit corporation, an amendment to the articles of incorporation generally requires a resolution approved by the board of directors and then a vote by the members. The Act specifies that unless the articles of incorporation or bylaws require a greater proportion, an amendment must be adopted by a majority of the votes cast by the members entitled to vote thereon at a meeting of members for which notice of the proposed amendment was given. If there are no members, or if members have no voting rights on the amendment, the amendment must be adopted by a majority vote of the directors. In this scenario, the articles of incorporation are silent on the specific voting threshold for amendments, and the corporation has members with voting rights. Therefore, the default statutory requirement of a majority of votes cast by members entitled to vote at a properly noticed meeting applies. The calculation of “majority of votes cast” means that if 100 members vote on the amendment, 51 votes in favor would constitute a majority. It is not a majority of the total membership, but a majority of those who actually cast a vote on the specific amendment. This ensures that a quorum is present and that the decision reflects the will of those actively participating in the vote. The process ensures a balance between efficient governance by the board and democratic input from the membership.

In Washington State, nonprofit corporations are governed by the Washington Nonprofit Corporation Act, codified in chapter 24.04 RCW. A fundamental aspect of this governance involves the duties of directors, particularly the duty of loyalty and the duty of care. The duty of loyalty requires directors to act in the best interests of the corporation, avoiding self-dealing and conflicts of interest. The duty of care mandates that directors act with the care that a reasonably prudent person in a like position would exercise under similar circumstances. When a director has a personal interest in a transaction, the transaction must be disclosed and approved in a manner that demonstrates fairness to the corporation. This typically involves approval by disinterested directors or, if that is not feasible, by a vote of the members, provided the director is also a member and the transaction is fair. Alternatively, the articles of incorporation or bylaws may provide specific procedures for handling such situations. The core principle is to ensure that decisions are made for the benefit of the nonprofit and its mission, not for the personal gain of individuals involved. The scenario presented involves a director who is also a vendor. This creates a potential conflict of interest that must be managed according to the Act. The director’s personal interest in the vendor contract must be addressed to maintain the integrity of the nonprofit’s governance. The most robust method to ensure fairness and compliance is to have the transaction approved by a majority of the disinterested directors after full disclosure of the director’s interest and the material facts of the transaction. This process safeguards against undue influence and ensures the contract is genuinely in the best interest of the nonprofit.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.205, outlines the requirements for the annual meeting of a nonprofit corporation. This statute mandates that a corporation shall hold an annual meeting of its members, if any, for the election of directors and for the transaction of other business. While the Act does not prescribe a specific date or month for this meeting, it does establish the necessity of holding one. The bylaws of a nonprofit corporation typically specify the timing and procedures for the annual meeting, but the statutory obligation to hold it remains. Failure to hold an annual meeting can have implications for corporate governance and may be viewed as a breach of fiduciary duty by the board of directors. Other statutes, such as those governing public disclosure or specific types of nonprofits (e.g., charitable trusts), may impose additional reporting or meeting requirements, but the fundamental obligation for an annual meeting is rooted in the corporate act itself. The question tests the understanding of the foundational requirement for an annual meeting under Washington law, irrespective of specific bylaw provisions or external reporting mandates.

The Washington Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A, outlines the procedures for amending articles of incorporation. For corporations that have not yet commenced public distribution of their shares or assets, or have not commenced business operations, the power to amend articles of incorporation typically resides with the incorporators. However, once the corporation has commenced operations or issued memberships, the authority shifts to the board of directors and, in certain circumstances, the members. RCW 24.03A.505 specifies that the board of directors may adopt amendments to the articles of incorporation without member approval if the amendment does not materially and adversely affect the rights of any class of members. If the amendment does affect member rights, or if the articles of incorporation or bylaws require member approval for such amendments, then member approval is necessary. The Act further clarifies in RCW 24.03A.510 that the board of directors can adopt certain amendments, such as changing the corporation’s name or extending its duration, without member vote. However, amendments that alter the purpose of the corporation, change the manner of distribution of assets upon dissolution, or modify membership rights generally require member approval. The question presents a scenario where the board of directors of a Washington nonprofit wishes to amend its articles to change its stated purpose from providing educational services to offering direct client advocacy. This change fundamentally alters the corporation’s mission and would likely have a material and adverse effect on the rights of any existing members who joined based on the educational mission. Therefore, under RCW 24.03A.505 and general principles of nonprofit governance that protect member interests, member approval is a necessary step for such a significant alteration to the corporate purpose. The board can propose the amendment, but its adoption requires the consent of the members, as stipulated by the Act for amendments impacting member rights or the fundamental nature of the organization.

The Washington State Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A, outlines the procedures for amending articles of incorporation. For a nonprofit corporation, amendments generally require approval by the board of directors and then by the members, if the articles or bylaws require member approval for such changes. The specific threshold for member approval is typically a majority of the votes cast by members entitled to vote on the matter, or a greater percentage if specified in the articles or bylaws. If the articles of incorporation are silent on member voting for amendments, the board’s resolution alone might suffice if the bylaws grant the board this authority. However, fundamental changes to the corporate purpose or structure usually necessitate member consent. In this scenario, the board of directors of “Cascadia Conservation Alliance” voted to amend their articles to reflect a broader mission. The bylaws, however, stipulate that any amendment to the articles requires approval by two-thirds of the voting members present at a duly called meeting. Since only 60% of the voting members were present and 70% of those present voted in favor, this equates to 42% of the total voting membership (\(0.70 \times 0.60 = 0.42\)). This falls short of the two-thirds (approximately 66.7%) required by the bylaws. Therefore, the amendment is not effective. The question tests the understanding of the interplay between board authority, member voting rights, and specific bylaw provisions governing article amendments under Washington law. It highlights that bylaws can impose stricter requirements than state law, and member approval thresholds must be met based on the total eligible voting membership, not just those present, unless otherwise specified.

Washington’s Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) 24.03A.305, outlines the duties of directors. These duties include the duty of care and the duty of loyalty. The duty of care requires directors to act with the care that a reasonably prudent person in a like position would exercise under similar circumstances, and to act in a manner the director reasonably believes to be in the best interests of the corporation. The duty of loyalty requires directors to act in good faith and in a manner the director reasonably believes to be in the best interests of the corporation, and to avoid conflicts of interest. When a director has a personal interest in a transaction, that director must disclose the conflict and recuse themselves from voting on the matter if the transaction is not fair to the corporation. If a transaction is fair to the corporation at the time it is authorized, the director’s participation in the vote or action does not violate the duty of loyalty. The question tests the application of these principles to a specific scenario involving a director’s personal interest in a contract with the nonprofit. The scenario describes a situation where a director’s spouse’s business is seeking a contract with the nonprofit. The director’s personal interest stems from this spousal relationship, creating a potential conflict of interest. For the transaction to be permissible under Washington law, it must be approved by a majority of the disinterested directors after full disclosure of the conflict, or it must be demonstrably fair to the corporation. The explanation focuses on the legal standard for such transactions, emphasizing full disclosure and fairness, and the potential consequences of failing to meet these standards, which could include personal liability for the director. The core concept is the director’s fiduciary duty to act in the best interest of the nonprofit and avoid self-dealing or conflicts of interest.

The scenario involves a Washington nonprofit corporation’s board of directors attempting to amend its articles of incorporation to change its mission. Washington’s Nonprofit Corporation Act, specifically Revised Code of Washington (RCW) Chapter 24.04, governs such actions. A fundamental principle is that the articles of incorporation represent the foundational document of the corporation, outlining its purpose and structure. Amendments to the articles require a formal process to ensure corporate stability and adherence to the original intent or a clearly defined new direction. While RCW 24.04.100 generally allows for amendments to articles of incorporation, it mandates specific procedures. For a change in the fundamental purpose or mission, which is a core element of the articles, the act typically requires approval by a supermajority of the board of directors and, often, a vote of the membership if the corporation has members. However, the specific threshold for amending articles of incorporation, particularly concerning the purpose clause, is often set at two-thirds of the directors present at a meeting where a quorum exists, as per RCW 24.04.100(3)(b). This supermajority requirement is designed to prevent hasty or ill-considered changes to the organization’s core identity. Without this higher threshold, a simple majority could potentially alter the very reason for the nonprofit’s existence, which might not align with the interests of all stakeholders or the spirit of the original incorporation. Therefore, a two-thirds vote of the directors is the legally mandated standard for this type of significant amendment.

The scenario involves a Washington nonprofit corporation, “Evergreen Arts Alliance,” which received a significant bequest intended for a specific program. The question revolves around the board’s fiduciary duties when faced with a potential conflict of interest and the process for amending bylaws. In Washington, nonprofit corporations are governed by the Revised Code of Washington (RCW) Chapter 24.04, specifically addressing nonprofit corporations. The duty of loyalty requires directors to act in the best interest of the corporation, avoiding self-dealing or conflicts of interest. If a director has a personal interest in a transaction, they must disclose it and typically abstain from voting on that matter. The duty of care requires directors to act with the care that an ordinarily prudent person in a like position would exercise under similar circumstances. Amending bylaws generally requires a resolution approved by the board of directors, followed by a vote of the members, if the bylaws permit member voting on such matters. However, if the bequest’s terms are legally binding and create a restricted endowment or specific purpose, the board’s ability to unilaterally redirect those funds might be limited. The Washington Attorney General’s office oversees charitable trusts and may have oversight if the funds are considered charitable assets. The key here is that the board must act prudently and in accordance with the organization’s governing documents and applicable law. If the bequest’s terms are unambiguous and restrict the funds to the “Youth Outreach Program,” and the board wishes to use them for general operations due to financial hardship, they would typically need to seek court approval or consent from the donor’s estate if possible, or explore other avenues that do not violate the terms of the gift. The question tests the understanding of director duties, conflict of interest protocols, and the process for amending governing documents in the context of restricted funds, emphasizing the board’s obligation to uphold donor intent and legal requirements.