Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred S.B. No. 2730, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to expand and clarify the State's business merger laws.

The Commissioner of Securities testified in support of this measure.

Currently, state law restricts mergers among various types of business entities and is unclear as to the requirements for mergers between certain entities. This measure, which is based on Delaware law, allows registered business entities to merge freely with other registered entities. Additionally, this measure clarifies the procedures for approval of a merger by shareholders and the filing of articles of merger. Your Committee finds that providing for greater flexibility in the State's merger laws will facilitate business and commercial activity in Hawaii.

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2730, S.D. 1, and recommends that it pass Third Reading.