1. Upon the written request of a shareholder, a corporation shall deliver or make available to such requesting shareholder by posting on its internet site or by other generally recognized means annual financial statements for the most recent fiscal year of the corporation for which annual financial statements have been prepared for the corporation. If financial statements have been prepared for the corporation on the basis of generally accepted accounting principles for such specified period, the corporation shall deliver or make available such financial statements to the requesting shareholder. If the annual financial statements to be delivered or made available to the requesting shareholder are audited or otherwise reported upon by a public accountant, the report shall also be delivered or made available to the requesting shareholder.

Terms Used In Iowa Code 490.1620

  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • delivery: means any method of delivery used in conventional commercial practice, including delivery by hand, mail, commercial delivery, and, if authorized in accordance with section 490. See Iowa Code 490.140
  • Distribution: means a direct or indirect transfer of cash or other property, except a corporation's own shares, or incurrence of indebtedness by a corporation to or for the benefit of its shareholders in respect of any of its shares. See Iowa Code 490.140
  • Expenses: means reasonable expenses of any kind, including reasonable fees and expenses of counsel and experts, that are incurred in connection with a matter. See Iowa Code 490.140
  • Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Internet: means the federated international system that is composed of allied electronic communication networks linked by telecommunication channels, that uses standardized protocols, and that facilitates electronic communication services, including but not limited to use of the world wide web; the transmission of electronic mail or messages; the transfer of files and data or other electronic information; and the transmission of voice, image, and video. See Iowa Code 4.1
  • Principal office: means the office, in or out of this state, so designated in the biennial report required by section 490. See Iowa Code 490.140
  • Proceeding: includes a civil suit and criminal, administrative, and investigatory action. See Iowa Code 490.140
  • Shareholder: means a record shareholder. See Iowa Code 490.140
  • state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
  • written: means any information in the form of a document. See Iowa Code 490.140
 2. A corporation shall deliver, or make available and provide written notice of availability of, the financial statements required under subsection 1 to the requesting shareholder within five business days of delivery of such written request to the corporation.
 3. A corporation may fulfill its responsibilities under this section by delivering the specified financial statements, or otherwise making them available, in any manner permitted by the applicable rules and regulations of the federal securities and exchange commission.
 4. Notwithstanding the provisions of subsections 1, 2, and 3, all of the following apply:

 a. As a condition to delivering or making available financial statements to a requesting shareholder, the corporation may require the requesting shareholder to agree to reasonable restrictions on the confidentiality, use, and distribution of such financial statements.
 b. The corporation may, if it reasonably determines that the shareholder’s request is not made in good faith or for a proper purpose, decline to deliver or make available such financial statements to that shareholder.
 5. If a corporation does not respond to a shareholder’s request for annual financial statements pursuant to this section in accordance with subsection 2 within five business days of delivery of such request to the corporation all of the following shall apply:

 a. The requesting shareholder may apply to the district court of the county where the corporation’s principal office, or if none in this state, its registered office is located for an order requiring delivery of or access to the requested financial statements. The court shall dispose of an application under this subsection on an expedited basis.
 b. If the court orders delivery or access to the requested financial statements, it may impose reasonable restrictions on their confidentiality, use, or distribution.
 c. In such proceeding, if the corporation has declined to deliver or make available such financial statements because the shareholder had been unwilling to agree to restrictions proposed by the corporation on the confidentiality, use, and distribution of such financial statements, the corporation shall have the burden of demonstrating that the restrictions proposed by the corporation were reasonable.
 d. In such proceeding, if the corporation has declined to deliver or make available such financial statements pursuant to subsection 4, paragraph “b”, the corporation shall have the burden of demonstrating that it had reasonably determined that the shareholder’s request was not made in good faith or for a proper purpose.
 e. If the court orders delivery or access to the requested financial statements it shall order the corporation to pay the shareholder’s expenses incurred to obtain such order unless the corporation establishes that it had refused delivery or access to the requested financial statements because the shareholder had refused to agree to reasonable restrictions on the confidentiality, use, or distribution of the financial statements or that the corporation had reasonably determined that the shareholder’s request was not made in good faith or for a proper purpose.
  Previous section
Next section  
 Chapter 490 Contents