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Non-Tech : Labor Ready (LRW) -- Ignore unavailable to you. Want to Upgrade?

To: Jim Cash who wrote (161)	6/16/1999 1:17:00 PM
From: Sir Auric Goldfinger	Read Replies (1) \| Respond to of 379

PROPOSAL 2. AMENDMENT OF ARTICLES OF INCORPORATION The Board of Directors has proposed an amendment to its articles of incorporation that would limit the personal monetary liability of directors for their actions as a director to the maximum extent permitted by Washington law. The text of the amendment to the Company's articles of incorporation is attached as Exhibit A. Washington law provides that, if authorized by a company's articles of incorporation, a director will not be personally liable to the corporation or its shareholders for monetary damages for conduct as a director. A director will be liable for (a) intentional misconduct by the director or a knowing violation of law by the director; (b) dividends and distributions that are paid in violation of Washington law; and (c) transactions in which the director personally receives a benefit in money, property or services to which the director is not legally entitled. The Washington legislature adopted the statute in 1989 in response to concerns that certain events had resulted in a significant increase in the risk of liability encountered by directors and that companies were experiencing significant difficulties in retaining outside directors and attracting qualified candidates as directors. The composition of the Company's board of directors, including its two independent directors, has changed little since the Company became listed on the Nasdaq Stock Market in 1996 and its subsequent listing on the New York Stock Exchange in 1998. The Company is engaged in identifying and recruiting prospective candidates for its board of directors. The board of directors believes the Company must raise the standard of protection for directors up to the level authorized by Washington law in order to attract highly qualified, independent directors. The Company has adopted some provisions to provide directors with protection. For example, the Company is authorized by its articles of incorporation to indemnify each director consistent with Washington law. Similarly, the Company has provided a limitation of monetary liability for directors in its bylaws and has obtained officers and directors liability insurance. While those provisions provide directors with a significant degree of protection, given the dramatic changes in the Company's operations and business activities in recent years (e.g., during the past five years the number of dispatch offices has increased from 51 to 686, while revenues have increased from $39 million to $607 million), the board of directors believes that the Company should provide its directors with the maximum protection authorized by Washington law. Since the amendment would, if adopted, limit the liability of the current directors, the current directors may be deemed to have a "conflicting interest" under Washington law. AS A RESULT, THE BOARD OF DIRECTORS ARE NOT MAKING A RECOMMENDATION TO THE COMPANY'S SHAREHOLDERS WITH RESPECT TO THE APPROVAL OR DISAPPROVAL OF PROPOSAL 2.