HB 418-CORPORATE NOTICES/PROCEDURES/VOTING  REPRESENTATIVE LISA MURKOWSKI, Chair of the House Labor and Commerce Committee, sponsor of HB 418, said HB 418 would help Alaskan corporations with their management and business operations by allowing them to offer electronic proxy voting and deliver materials to shareholders electronically. She said this change would be similar to corporate code changes made by 25 other states. She said it would allow for efficiencies such as householding of shareholder information. She said she and her sons received their annual notices from an out-of-state corporation in which they were shareholders. She was able to vote online for the entire family in about a minute and a half. She was prompted for a personal identification number and her vote. She said a lot of shareholders received their ballots and put them in the pile of things to do and didn't get to them until too late. SENATOR THERRIAULT asked who would benefit monetarily from the streamlined process. REPRESENTATIVE MURKOWSKI said any Alaskan corporation would benefit, including Alaska-based banks and Native corporations. She said HB 418 originated from Sealaska because they wanted to provide notices to their shareholders electronically. CHAIRMAN TAYLOR asked if there were any further questions for Representative Murkowski. There were none. MR. JOE NELSON, legal counsel, Sealaska Corporation, said HB 418 was not a new idea and there was nothing unique in the language of the bill. He said it was modeled after corporate codes from across the country but came primarily from Delaware and California codes and the Federal Communications Commission guidelines. CHAIRMAN TAYLOR said HB 418 would provide shareholders with convenience and should lead to increased participation by shareholders. He said Alaska had the highest rate of computer ownership and Internet access in the country. He said HB 418 would provide for many opportunities to reduce costs. For example Sealaska could save a lot of money by householding information. He attended a national meeting of corporate secretaries that had a discussion panel about householding and electronic voting. He learned that corporations across the country were saving millions of dollars by using the methods outlined in HB 418. SENATOR THERRIAULT asked if Sealaska paid anything to the State for oversight. MR. NELSON didn't know. SENATOR THERRIAULT thought statutes allowed the State to charge Native corporations a fee for the oversight provided by the Division of Banking, Securities & Corporations (DBSC). He did not believe the State had been charging Native corporations. He said HB 418 would be revenue neutral for the State but would provide a savings to corporations. He said perhaps with this savings it would be time for Native corporations to pay for oversight like the rest of the corporations in the state. MR. NELSON said DBSC had previously been concerned with HB 418 but those concerns related to financial impact to the State rather than fees paid to the State. He said Sealaska and DBSC worked out those concerns. He said DBSC had testified on HB 418 and he didn't think they had any problems with the reworked bill. He said the current fiscal note reflected no cost to the State. CHAIRMAN TAYLOR asked how long a proxy lasted. MR. NELSON thought a proxy lasted 11 months unless a new proxy was submitted. He said HB 418 wouldn't impact the length of proxies. CHAIRMAN TAYLOR thought HB 418 would be beneficial to all parties involved. He said there had been a lot of discussion in the legislature about minority shareholders who were frustrated by the actions of management and wanted to have their views heard. He thought HB 418 would make it easier for them to express their views because of increased ease of communications. CHAIRMAN TAYLOR asked if there were any further questions for Mr. Nelson. There were none. He asked if there was anybody else who wished to testify on HB 418. There was nobody. He asked if there were any amendments. SENATOR COWDERY offered the following Amendment 1. A M E N D M E N T OFFERED IN THE SENATE TO: CSHB 418(L&C) Page 5, lines 13 - 14: Delete "executed by electronic transmission" Page 5, line 18: Delete "transmission; and" Insert "proxy;" Page 5, line 20: Delete "transmission" Insert "proxy, authorized an attorney-in-fact for the  shareholder, if applicable, authorized an agent under (1) of this  subsection to receive the proxy, if applicable, and authorized an  electronic transmission, if applicable; and (3) if the corporation is using corporation money  to send out the proxy form, include  (A) on the form a line for the shareholder  to name an eligible shareholder as the holder of the  proxy; and  (B) with the form appropriate instructions  on using the line required by (A) of this paragraph,  including an instruction that the shareholder may name  a person to hold the proxy who is not a part of the  current management of the corporation" SENATOR THERRIAULT asked if the amendment had been discussed with the sponsor of HB 418. REPRESENTATIVE MURKOWSKI said she had not seen the amendment before. CHAIRMAN TAYLOR didn't think Amendment 1 would change the intent of HB 418. He said Amendment 1 would require the corporations to provide a form with the appropriate instructions so that a person who wished to could write in a proxy holder. He thought most corporations already did so. REPRESENTATIVE MURKOWSKI agreed that was probably what Amendment 1 would do. She asked for the source of Amendment 1. CHAIRMAN TAYLOR understood that every Native corporation already provided a blank line to write in proxies. However, he had heard that Cook Inlet Region, Inc. (CIRI) didn't provide any such space and threw away any proxies that were written in. He said he didn't know whether that was true. He said a CIRI shareholder had asked that shareholders be given the opportunity to name their own proxy. MR. NELSON thought Sealaska had always provided for write-in proxies. He thought it was already a requirement. SENATOR THERRIAULT asked if that was a requirement of Sealaska or the State. MR. NELSON said Sealaska required it. He also thought it was provided for in State regulations. SENATOR THERRIAULT wondered if Amendment 1 would codify State regulations that CIRI might have been ignoring. CHAIRMAN TAYLOR said that was his assumption but he couldn't confirm that. He announced that the committee would hear the bill again on Wednesday to allow time for these questions to be answered. HB 418 was held in committee with Amendment 1 pending.