TITLE VII

STOCK AND
STOCKHOLDERS
 Shareholders, both common and
preferred, are considered risk takers
who invest capital in the business and who
can look only to what is left after
corporate debts and liabilities are fully
paid.
ACTION BY STOCKHOLDERS OR MEMBERS

DERIVATIVE SUIT
Derivative suit is an action brought by minority
shareholders in the name of the corporations to
redress wrongs committed against it, for which
the directors refuse to sue. It is a remedy
designed by equity and has been the principal
defense of the minority shareholders against
abuses by the majority.
REQUISITES OF A DERIVATIVE SUIT
a.) The party bringing suit should be a shareholder
as of the time of the act or transaction complained
of, the number of his shares not being material;

b.) He has tried to exhaust intra-corporate remedies.

Ex. He has a demand on the BOD for the
appropriate relief but the latter has failed or
refused to heed his plea.

c.) The cause of action actually devolves on the

corporation, the wrongdoings or harm having been
or being caused to the corporation and not to the
particular stockholder bringing the suit.
REQUIREMENTS OF DERIVATIVE SUIT
Among the basic requirements for a derivative suit to proper
is that the minority shareholder who is suing for and on
behalf of the corporation must allege in his complaint before
the proper forum that he is suing on derivative cause of
action on behalf of the corporation and all other
shareholders similarly situated who wish to join. This is
necessary to vest jurisdiction upon the tribunal in line with
the rule that it is the allegations in the complaint that vests
jurisdiction upon the court or quasi-judicial body concerned
over the subject matter and nature of the action.
DERIVATIVE SUIT VS. INDIVIDUAL SUIT VS. CLASS SUIT
DERIVATIVE SUIT INDIVIDUAL SUIT CLASS SUIT
Where the acts complained Where a stockholder or member Where the wrong is done to
of constitute a wrong to the is denied the right of inspection, group stockholders, as where
corporation itself, the cause of action his suit would be individual preferred stockholders rights are
belongs to the corporation and not to because the wrong is done to him violated, as class or
the individual stockholder personally and representative suit will be proper
or member. Although in most every not to the other stockholders or for the protection
case of wrong to the corporation. of all stockholders belonging to
the corporation, each stockholder is the same group.
necessarily affected because the value
of his interest therein would be
impaired, this fact of itself is not
sufficient to give him an individual
cause of action since the corporation is
a person distinct and separate from
him, and can and should itself sue the
wrongdoer.
Furthermore, there is the difficulty of
determining the amount of damages
that should be paid to each individual
stockholder.
 SECTION 59 SUBSCRIPTION
CONTRACT

Any contract for the acquisition of unissued stock in an existing

corporation or a corporation still to be formed shall be deemed a
subscription within the meaning of this Title, notwithstanding the
fact that the parties refer to it as a purchase or some other contract.
A PERSON MAY BECOME A SHAREHOLDER/MEMBER
STOCK CORPORATION
A.) by subscription contract
B.) by purchase of the corp treasury shares
C.) by transfer from a previous stockholder.
NON STOCK CORPORATION
Membership is acquired by contract with the corp., the
modes of entering into which vary according to the charter
and by laws of the corp.
SECTION 60 PRE-INCORPORATION
SUBSCRIPTION

A subscription of shares in a corporation still to be formed shall be

irrevocable for a period of at least six (6) months from the date of
subscription, unless all of the other subscribers consent to the
revocation, or the corporation fails to incorporate within the same
period or within a longer period stipulated in the contract of
subscription.
No pre-incorporation subscription may be revoked after the articles
of incorporation are submitted to the Commission.
KINDS OF SUBSCRIPTION
I. Pre-incorporation subscription
A subscription for shares of stock of a corporation still to be formed.

Rules:
1. A pre-incorporation subscription is irrevocable for a period of at least
6 months from the date of subscription.

Exceptions:
a. All of the other subscribers consent to the revocation.
b. The corporation fails to incorporate within the same period or
within a longer period stipulated in the contract of subscription.

2. No pre-incorporation subscription may be revoked after the

submission of the articles of incorporation to the SEC.
KINDS OF SUBSCRIPTION
II. Post-incorporation subscription
A subscription entered into after the incorporation for the acquisition
of unissued stock.

Note:
As a rule, a subscriber becomes a stockholder upon perfection of the
subscription contract even though he has not paid for his shares.
As long as the shares are not considered delinquent, stockholders are
entitled to all rights granted to it whether or not subscribed capital
stocks are fully paid.
 SECTION 61 CONSIDERATION FOR
STOCKS
Stocks shall not be issued for a consideration less than the par or issued price thereof. Consideration for the
issuance of stock may be:
(a) Actual cash paid to the corporation;
(b) Property, tangible or intangible, actually received by the corporation and necessary or convenient for its
use and lawful purposes at a fair valuation equal to the par or issued value of the stock issued;
(c) Labor performed for or services actually rendered to the corporation;
(d) Previously incurred indebtedness of the corporation;
(e)Amounts transferred from unrestricted retained earnings to stated capital;
(f) Outstanding shares exchanged for stocks in the event of reclassification or conversion;
(g) Shares of stock in another corporation; and/or (h)
Other generally accepted form of consideration.

Where the consideration is other than actual cash, or consists of intangible property such as patents or
copyrights, the valuation thereof shall initially be determined by the stockholders or the board of directors,
subject to the approval of the Commission.

Shares of stock shall not be issued in exchange for promissory notes or future service. The same considerations
provided in this section, insofar as applicable, may be used for the issuance of bonds by the corporation.

The issued price of no-par value shares may be fixed in the articles of incorporation or by the board of directors
pursuant to authority conferred by the articles of incorporation or the bylaws, or if not so fixed, by the
stockholders representing at least a majority of the outstanding capital stock at a meeting duly called for the
purpose.
AMOUNT OF CONSIDERATION
Stocks shall not be issued for a consideration less than the par or
issued price thereof. Take note that the above provision does not
prohibit a corporation from issuing stocks for a consideration above
the par or issued price.

Consideration consists of property

Requisites:

1. It must be subject to a fair valuation equal to the par or issued value of

the stock issued;
2. The property is actually received by the corporation; and
3. If it consists of intangible property, the valuation thereof shall initially
be determined by the incorporators or the board of directors subject to
the approval by the SEC.
 SECTION 62 CERTIFICATE OF STOCK AND
TRANSFER OF SHARES
The capital stock of corporations shall be divided into shares for which certificates
signed by the president or vice president, countersigned by the secretary or assistant
secretary, and sealed with the seal of the corporation shall be issued in accordance with
the bylaws. Shares of stock so issued are personal property and may be transferred by
delivery of the certificate or certificates indorsed by the owner, his attorney-in-fact, or
any other person legally authorized to make the transfer.

No transfer, however, shall be valid, except as between the parties, until the transfer is
recorded in the books of the corporation showing the names of the parties to the
transaction, the date of the transfer, the number of the certificate or certificates, and
the number of shares transferred.

The Commission may require corporations whose securities are traded in trading
markets and which can reasonably demonstrate their capability to do so to issue their
securities or shares of stocks in uncertificated or scripless form in accordance with the
rules of the Commission.

No shares of stock against which the corporation holds any unpaid claim shall be
transferable in the books of the corporation.
REQUISITES OF FORMAL CERTIFICATE OF STOCK:

FIRST, the certificate must be SIGNED BY THE PRESIDENT or VICE

PRESIDENT, countersigned by the secretary or assistant. Sec and
sealed with the seal of the corporation.

SECOND, delivery of the cert. is an essential element of its issuance.

THIRD, the par value, as to par value shares, or the full subscriptions as
to no par value shares, must first be fully paid.

FOURTH, the original cert. must be surrendered where the person

requesting the issuance of a cert. is a transferee from a stockholder.
 SHARE OF STOCK CERTIFICATE OF STOCK
Evidenced of the
Unit of interest in a holder’s ownership of
corporation. the stock and of his
right as a shareholder

Intangible personal Tangible personal

property property

May be issued by the May be issued only

corporation even if if the subscription is
the subscription is not fully paid
fully paid
stock corporations
- MAY GENERALLY TRANSFER THEIR SHARES
ON THE DEATH OF A SHAREHOLDER, THE EXECUTOR OR ADMINISTRATOR DULY APPOINTED BY THE
COURT IS VESTED WITH THE LEGAL TITLE TO THE STOCK AND ENTITLED TO VOTE IT. UNTIL A
SETTLEMENT AND DIVISION OF THE ESTATE IS EFFECTED, THE STOCKS OF THE DECEDENT ARE HELD
BY THE ADMINISTRATOR OR EXECUTOR.

NONstock corporations
GR: PERSONAL AND NON-TRANSFERABLE
UNLESS THE ARTICLES OF INCORPORATION OR THE BY-LAWS OF THE CORPORATION PROVIDE OTHERWISE.
No transfer, however, shall be valid, except as between the parties, until
the transfer is recorded in the books of the corporation showing the
names of the parties to the transaction, the date of the transfer, the
number of the certificate or certificates, and the number of shares
transferred.

BETWEEN PARTIES VALID

THIRD PERSONS AND THE
CORPORATION NOT VALID
until the transfer is recorded in the
books of the corporation
MODE OF TRANSFER OF STOCKS AS PROVIDED BY LAW

a.) There must be delivery of the stock certificate.

b.) The certificate must be endorsed by the owner or
his attorney-in-fact or by other persons legally
authorized to make the transfer
c.) To be valid against third parties, the transfer
must be recorded in the books of corporation.
TRANSFER OF SHARES BY MEANS OF SUCCESSION

the transfer of title by means of succession, though effective

and valid between the parties involved (i.e., between the
decedent's estate and her heirs), does not bind the
corporation and third parties. The transfer must be
registered in the books of the corporation to make the
transferee-heir a stockholder entitled to recognition as such
both by the corporation and by third parties.
EFFECT OF ENDORSEMENT OF THE CERTIFICATE OF
STOCK
The rule is that the endorsement of the certificate of stock by the owner or his attorney-
in-fact or any other person legally authorized to make the transfer shall be sufficient to
effect the transfer of shares only if the same is coupled with delivery. The delivery of the
stock certificate duly endorsed by the owner is the operative act of transfer of shares
from the lawful owner to the new transferee.
Thus, for a valid transfer of stocks, the requirements are as follows:
(a) There must be delivery of the stock certificate;
(b) The certificate must be endorsed by the owner or his attorney-in-fact or other persons
legally authorized to make the transfer; and,
(c) To be valid against third parties, the transfer must be recorded in the books of the
corporation.
Considering that the requirements provided under Sec. 63 of The Corporation Code (Now
Section 62, Revised Corporation Code) should be mandatorily complied with, the rule
on presumption of regularity cannot apply. The regularity and validity of the transfer
must be proved.
SECTION 63 ISSUANCE OF STOCK
CERTIFICATE

No certificate of stock shall be issued to a subscriber until

the full amount of his subscription together with interest
and expenses (in case of delinquent shares), if any is due,
has been paid.
 SECTION 64
LIABILITY OF DIRECTORS FOR WATERED STOCK
– A DIRECTOR OR OFFICER OF A CORPORATION WHO: (A)
CONSENTS TO THE ISSUANCE OF STOCKS FOR A CONSIDERATION
LESS THAN ITS PAR OR ISSUED VALUE; (B) CONSENTS TO THE
ISSUANCE OF STOCKS FOR A CONSIDERATION OTHER THAN CASH,
VALUED IN EXCESS OF ITS FAIR VALUE; OR (C) HAVING KNOWLEDGE
OF THE INSUFFICIENT CONSIDERATION, DOES NOT FILE A WRITTEN
OBJECTION WITH THE CORPORATE SECRETARY, SHALL BE LIABLE
TO THE CORPORATION OR ITS CREDITORS, SOLIDARILY WITH THE
STOCKHOLDER CONCERNED FOR THE DIFFERENCE BETWEEN THE
VALUE RECEIVED AT THE TIME OF ISSUANCE OF THE STOCK AND THE
PAR OR ISSUED VALUE OF THE SAME.
 SECTION 64
LIABILITY OF DIRECTORS FOR WATERED STOCK
Watered stocks are stocks issued for no value at all or is issued at a higher value
then it is actually worth (either in cash, property, services, or stock dividends.)
It includes stocks that are:

1. Issued for without consideration – BONUS SHARE

2. Issued as fully paid when the corporation has received a lesser
sum of money than its par or issued value – DISCOUNT SHARE
3. Issued for a consideration other than actual cash, such as
property or services, the fair valuation [fair value] of which is
less than its par or issued value
4. Issued a stock dividend when there are no sufficient
retained earnings or surplus
 SECTION 64
LIABILITY OF DIRECTORS FOR WATERED STOCK
1. AS TO THE CORPORATION, THE ISSUANCE OF WATERED STOCK IS NOT
MERELY ULTRA VIRES BUT IS ILLEGAL PER SE AS IT IS VIOLATION OF
SECTION 62.

2. AS TO CREDITORS, LIABILITY ATTACHES WHETHER OR NOT CREDITORS HAVE

RELIED ON AN OVER-VALUATION OF CORPORATE CAPITAL.

3. AS TO SEC, WHETHER OR NOT AN ISSUANCE WOULD AMOUNT TO AN ISSUE

OF WATERED STOCK IS WELL WITHIN ITS AUTHORITY TO INQUIRE INTO IN
VIEW OF ITS POWERS AND DUTY TO ENFORCE ALL LAW AFFECTING
CORPORATIONS
*THE ISSUE ITSELF IS NOT VOID, BUT THE AGREEMENT THAT THE
SHARES SHALL BE PAID FOR LESS
THAN ITS PAR OR ISSUED VALUE IS ILLEGAL AND VOID AND IT
CANNOT BE ENFORCED.
 SECTION 65
INTEREST ON UNPAID SUBSCRIPTION
Subscribers to stock shall be liable to the
corporation for interest on all unpaid
subscriptions from the date of subscription,
if so required by and at the rate of interest
fixed in the subscription contract. If no rate
of interest is fixed in the subscription
contract. If no rate of interest is fixed in the
subscription contract, the prevailing legal
rate shall apply.
 SECTION 66
PAYMENT OF BALANCE OF SUBSCRIPTION
Subject to the provisions of the subscription
contract, the board of directors may, at any time,
declare due and payable to the corporation unpaid
subscriptions and may collect the same or such
percentage thereof, in either case, with accrued
interest, if any, as it may deem necessary.
 SECTION 67 DELIQUENCY SALE
The board of directors may, by resolution, order the sale of delinquent stock and shall specifically state the
amount due on each subscription plus all accrued interest, and the date, time and place of the sale which shall
not be less than thirty (30) days nor more than sixty (60) days from the date the stocks become delinquent.

Notice of the sale, with a copy of the resolution, shall be sent to every delinquent stockholder either personally, by
registered mail, or through other means provided in the bylaws. The same shall be published once a week for two
(2) consecutive weeks in a newspaper of general circulation in the province or city where the principal office of the
corporation is located.

Unless the delinquent stockholder pays to the corporation, on or before the date specified for the sale of the
delinquent stock, the balance due on the former's subscription, plus accrued interest, costs of advertisement and
expenses of sale, or unless the board of directors otherwise orders, said delinquent stock shall be sold at a public
auction to such bidder who shall offer to pay the full amount of the balance on the subscription together with
accrued interest, costs of advertisement and expenses of sale, for the smallest number of shares or fraction of a
share. The stock so purchased shall be transferred to such purchaser in the books of the corporation and a
certificate for such stock shall be issued in the purchaser's favor. The remaining shares, if any, shall be credited in
favor of the delinquent stockholder who shall likewise be entitled to the issuance of a certificate of stock covering
such shares.

Should there be no bidder at the public auction who offers to pay the full amount of the balance on the
subscription together with accrued interest, costs of advertisement, and expenses of sale, for the smallest
number of shares or fraction of a share, the corporation may, subject to the provisions of this Code, bid for the
same, and the total amount due shall be credited as fully paid in the books of the corporation. Title to all the
shares of stock covered by the subscription shall be vested in the corporation as treasury shares and may be
disposed of by said corporation in accordance with the provisions of this Code.
 PAYMENT OF UNPAID SUBSCRIPTION
I. VOLUNTARY PAYMENT
PAYMENT SHALL BE MADE ON THE DATE SPECIFIED IN THE CONTRACT OF SUBSCRIPTION OR ON THE DATE
STATED IN THE CALL MADE BY THE BOARD.

II. INVOLUNTARY PAYMENT

1. EXTRA-JUDICIAL
A. DELINQUENCY SALE
THE BOARD OF DIRECTORS MAY, BY RESOLUTION, ORDER THE SALE OF DELINQUENT STOCK.

B. APPLICATION OF DIVIDENDS
THE CASH DIVIDENDS DUE ON DELINQUENT STOCK SHALL FIRST BE APPLIED TO THE UNPAID BALANCE ON
THE SUBSCRIPTION PLUS COSTS AND EXPENSES, WHILE STOCK DIVIDENDS SHALL BE WITHHELD FROM
THE DELINQUENT STOCKHOLDER UNTIL HIS UNPAID SUBSCRIPTION IS FULLY PAID

2. JUDICIAL ACTION
THE CORPORATION CAN COLLECT BY ACTION IN A COURT OF PROPER JURISDICTION THE AMOUNT DUE ON
ANY UNPAID SUBSCRIPTION,WITH ACCRUED INTERESTS,COSTS AND EXPENSES.
 SECTION 68 WHEN SALE MAY BE QUESTIONED

No action to recover delinquent stock sold can be sustained upon

the ground of irregularity or defect in the notice of sale, or in the
sale itself of the delinquent stock, unless the party seeking to
maintain such action first pays or tenders to the party holding the
stock the sum for which the same was sold, with interest from the
date of sale at the legal rate. No such action shall be maintained
unless a complaint is filed within six (6) months from the date of
sale.
 RECOVERY OF STOCK UNLAWFULLY SOLD
Grounds for recovery of stock unlawfully sold for delinquency are:

1. Irregularity or defect in the notice of sale

2. Irregularity or defect in the sale itself of the delinquent stock

Note: Irregularity or defect in the call for unpaid subscription in

the notice of delinquency is no longer included among the
grounds for questioning the sale
 SECTION 69
COURT ACTION TO RECOVER UNPAID
SUBSCRIPTION

Nothing in this Code shall prevent the corporation

from collecting through court action, the amount due
on any unpaid subscription, with accrued interest,
costs and expenses.
 SECTION 70
EFFECT OF DELINQUENCY
No delinquent stock shall be voted for, be entitled to
vote, or be represented at any stockholder's meeting,
nor shall the holder thereof be entitled to any of the
rights of a stockholder except the right to dividends in
accordance with the provisions of this code, until and
unless payment is made by the holder of such
delinquent stock for the amount due on the
subscription with accrued interest, and the costs and
expenses of advertisement, if any.
THE HOLDER OF A DELINQUENT STOCK IS NOT INCLUDED
IN THE DETERMINATION QUORUM BECAUSE HE IS NOT
ENTITLED TO VOTE; HOWEVER, HE IS ENTITLED TO HIS
RIGHT TO DIVIDENDS.
 SECTION 71 RIGHTS OF UNPAID SHARES, NON-
DELINQUENT

Holders of subscribed shares not fully paid which are not

delinquent shall have all the rights of stockholders.
 SECTION 72 LOST OR DESTROYED
CERTIFICATES
The following procedure shall be followed by a corporation
in issuing new certificates of stock in lieu of those which
have been lost, stolen or destroyed:

1. Affidavit by the shareholder

2. Verification and Publication of notice by the
corporation
3. Presentation of contest within the waiting period of
one (1) year
4. Replacement of certificate
 RIGHTS OF A STOCKHOLDER
I.MANAGEMENT RIGHTS
To attend and vote in person or by proxy at

To elect and remove directors.

To approve certain corporate acts

To adopt and amend or repeal the by-laws or adopt new by-laws

To compel the calling of the meetings

To enter into a voting trust agreement

To have the corporation voluntarily dissolved
 II.PROPRIETARY RIGHTS

To transfer stock in the corporate book

To receive dividends when declared

To issuance of certificate of stock To participate in the distribution of

corporate assets upon dissolution

To participate in the distribution of corporate assets upon dissolution.

To pre-emption in the issue of shares

 III.REMEDIAL RIGHTS

To inspect corporate books

To recover stock unlawfully sold for delinquent payment of

subscription

To be furnished with most recent financial statements

To bring suits (derivative, individual, and representative suit)

To demand payment in the exercise of appraisal right

 LIABILITIES OF STOCKHOLDERS

Liability for the unpaid subscription

Liability for interest on unpaid subscription

Liability to creditors of the corporation on the unpaid

subscription

Liability for watered stock

Liability for dividends unlawfully paid

 TITLE VIII
CORPORATE BOOKS
AND RECORDS
 TITLE VIII OF THE CORPORATE CODE, ENTITLED
"CORPORATE BOOKS AND RECORDS," ESTABLISHES
THE FRAMEWORK FOR THE METICULOUS
MANAGEMENT AND PRESERVATION OF ESSENTIAL
DOCUMENTATION WITHIN CORPORATIONS.
 SECTION 73 BOOKS TO BE KEPT; STOCK
TRANSFER AGENT.
Every corporation shall keep and carefully preserve at its principal office all information relating to
the corporation including, but not limited to:

(a) The articles of incorporation and bylaws of the corporation and all their amendments;
(b) The current ownership structure and voting rights of the corporation, including lists of stockholders
or members, group structures, intra-group relations, ownership data, and beneficial ownership;
(c) The names and addresses of all the members of the board of directors or trustees and the
executive officers;
(d) A record of all business transactions;
(e) A record of the resolutions of the board of directors or trustees and of the stockholders or
members;
(t) Copies of the latest reportorial requirements submitted to the Commission; and
(g) The minutes of all meetings of stockholders or members, or of the board of directors or trustees.
Such minutes shall set forth in detail, among others: the time and place of the meeting held, how it
was authorized, the notice given, the agenda therefor, whether the meeting was regular or special, its
object if special, those present and absent, and every act done or ordered done at the meeting. Upon
the demand of a director, trustee, stockholder or member, the time when any director, trustee,
stockholder or member entered or left the meeting must be noted in the minutes; and on a similar
demand, the yeas and nays must be taken on any motion or proposition, and a record thereof carefully
made. The protest of a director, trustee, stockholder or member on any action or proposed action must
be recorded in full upon their demand.
MANDATORY RECORDS
Articles of incorporation, bylaws, ownership structure, names and addresses of board members and executives,
business transactions, resolutions of the board and stockholders, copies of reports submitted to the
Commission, and minutes of meetings are among the documents that every corporation is required to maintain
and preserve at its principal office.
ACCESS TO RECORDS
All corporate records must be available for directors, trustees, stockholders, or members to inspect during
regular business hours, regardless of the format. Records copies may be requested in writing and at the
requester's cost.
CONFIDENTIALITY RULES
In accordance with current regulations, the person seeing or copying records must respect confidentiality
requirements, including those pertaining to intellectual property, trade secrets, data privacy, and securities
regulation.
LIMITATIONS ON ACCESS
Certain parties are not entitled to view corporate records or request copies of them, including competitors,
directors, officers, controlling stockholders, and those advocating on their behalf.
PENALTIES FOR ABUSE
A stockholder who misuses their rights could face consequences under Section 158 of the Code. Refusing to
allow inspection could result in legal ramifications and liability for damages for officers or agents.
DEFENSE AGAINST IMPROPER USE
If the party requesting the inspection has not been acting in good faith, has misused information from earlier
exams, is a competitor, director, officer, controlling stockholder, or is representing the interests of a rival, it is a
defense to an action under this provision.

COMMISSION INTERVENTION
The offended party may submit the matter to the Commission, which will carry out a summary investigation
and issue an order mandating the examination or reproduction of the required records, if the corporation
refuses to comply with the request for inspection or does not act upon it.

STOCK AND TRANSFER BOOK

As required by the bylaws, stock corporations must keep a stock and transfer book with records of all stocks,
payments, transfers, and other entries. Director and stockholder inspection of this book should be permitted.

STOCK TRANSFER AGENT

Agents who transfer stocks are required to apply for and pay for a license from the Commission. Additionally,
the Commission has the authority to mandate that stock companies trading on the secondary market use a
separate transfer agent.
 SECTION 74 RIGHTS TO FINANCIAL
STATEMENTS
Every corporation is required to provide its stockholders or members with their most
recent financial statement within ten (10) days from receiving a written request.
Financial Statements are presented at regular meetings.
The financial statement must be presented in the form and substance required by the
Securities and Exchange Commission (SEC).
The corporation's board of directors or trustees must present a financial report that
includes the financial statements for the preceding year.
The financial statements must be duly signed and certified in accordance with the
Corporation Code and the rules prescribed by the SEC.
If the corporation's total assets or total liabilities are less than Six hundred thousand
pesos (P600,000.00) or such other amount as may be determined appropriate by the
Department of Finance, the financial statements may be certified under oath by the
treasurer and the president.
CORPORATE SECRETARY

-responsible for keeping and maintaining the corporation's

records, including minutes of meetings
-their signature on the minutes adds credibility and makes
them legally binding.
-If the corporate secretary is unable to certify the minutes,
other directors or stockholders must provide proof of their
accuracy
RIGHTS OF INSPECTION
Stockholders have the right to inspect the corporation's books and records.
This right is based on their ownership of the corporation's assets and
property.
The right of inspection is necessary for self-protection.
Stockholders must exercise their right of inspection in a proper and lawful
manner that is in the best interests of the corporation.
The inspection must be relevant to the stockholder's interest as a
stockholder.
The right to inspect corporate records is not absolute.
A stockholder's demand for inspection may be denied if they are not
acting in good faith or for a legitimate purpose.
Requests that are purely speculative or merely to satisfy curiosity may
also be denied.
Corporate books and records
-must be kept at the corporation's principal office, except for the stock
and transfer book, which may be kept at the principal office or in the
office of a stock transfer agent.
-Stock transfer agent
-entity that is licensed by the Securities and Exchange Commission (SEC)
to register transfers of stocks on behalf of stock corporations.
-regardless of their form, are open to inspection by any director, trustee,
stockholder, or member of the corporation in person or by a
representative during reasonable business hours
Directors, trustees, stockholders, or members may request copies or
excerpts
Individuals who are not stockholders or members of record, or who are
competitors, directors, officers, controlling stockholders, or representatives
of competitors, do not have the right to inspect or demand copies of
corporate records.
thank you!