Form with which a shareholder may demand the opportunity to inspect the records of a corporation in which the shareholder holds stock.
Hawaii Demand Inspection of Books — Corporate Resolutions refers to a legal process that allows shareholders or members of a corporation in Hawaii to request access to the company's books and records. This demand can be made for a variety of reasons, such as assessing the company's financial health, investigating potential mismanagement, or preparing for legal action. The demand for inspection can be made in the form of a written notice sent to the corporation where the shareholder or member specifies their intent to examine the books and records. The demand must state a proper purpose, which should be a valid reason related to the shareholder's interest in the company. Common purposes include valuation of shares, auditing financial statements, investigating potential breaches of fiduciary duty, or assessing the business's fair market value. It is crucial for the demand to be made in compliance with the Hawaii Revised Statutes (HRS). Specifically, HRS section 414-152 outlines the requirements and procedures for making such a demand. The corporation is obligated to respond to the demand within a specified timeframe, usually within five business days. Hawaii's law recognizes two different types of Demand Inspection of Books — Corporate Resolutions: 1. Limited Inspection: A shareholder can request specific documents or records that are reasonably related to their purpose. The corporation must provide access to these requested materials, allowing the shareholder to review and copy them. However, this type of inspection may not grant access to all books and records held by the corporation. 2. Full Inspection: A shareholder can demand a more comprehensive examination of all the books and records maintained by the corporation, including financial statements, minutes of meetings, stock ledgers, and other relevant materials. The shareholder must demonstrate a substantial purpose for needing such broad access, typically involving suspected fraud, mismanagement, or other serious concerns. The corporation has the right to challenge the shareholder's demand for inspection if it believes the purpose is improper or not in line with the law. In such cases, the corporation may seek legal counsel to contest the demand, ensuring that the shareholder's request aligns with the statutory requirements. Overall, the Hawaii Demand Inspection of Books — Corporate Resolutions provides shareholders with an essential mechanism to monitor the company's operations, protect their interests, and maintain transparency within the corporation.
