What are the rights of shareholders with respect to inspecting the books and records of the corporation?
Any shareholder of a corporation may demand (1) the minutes of shareholder proceedings and (2) records of shareholders on 5 day’s of advance written notice to corporation.
After receipt of a such request, the Corporation may demand that the shareholder give an affidavit that his purpose is not other than the interest of the corporation and he has not within 5 years tried to sell any list of shareholders.
If the shareholder refuses to furnish such an affidavit, the corporation may deny access.
Regarding the list of the current directors and officers, any shareholder can demand that on two day’s written demand. There is no affidavit requirement for this option.
Regarding the corporation’s latest (1) annual balance sheet, (2) profit and loss statement and (3) interim statements distributed to shareholders or public, any shareholder may make a written request, and the corporation must provide the documents.
All shareholders also have a common law right to inspect records at a reasonable time and proper place. Inspection must be for a proper purpose, which means something related to shareholder’s role in the corporation.
Published by Metin Caglar, Esq. / Corporate Law Articles