Destileria Limtuaco & Co., Inc

June 25, 1985 Destileria Limtuaco & Co.,Inc. 277 Juan Luna Street Manila, Philippines Attention : Mr . Julius T . Limpe President Sir : This has reference to your letter dated May 28, 1985 requesting for the opinion of this Commission on the following query: "Is a mere stockholder, a non-resident alien, who is neither a director or an officer of the company, entitled to be mailed the following documents: 1) Minutes of previous annual meeting 2) Audited Financial Statement 3) A report on the company's affairs 4) Slate of nominees for Board election?" It appears from your letter that your Corporate Secretary on March 25, 1985, had mailed to all your shareholders a notice of stockholders' meeting a copy of which was enclosed therewith, more than a month prior to the Annual Stockholders' Meeting but the said stockholder did not bother to attend said meeting. Furthermore, your Corporate Secretary had also mailed a copy of your audited Financial Statement to the said stockholder because of his request to be furnished the above-mentioned documents. Anent thereto, the pertinent provisions of the Corporation Code provide, and we quote: "SECTION 74. ... The records of all business transactions of the corporation and the minutes of any meeting shall be open to the inspection of any director, trustee, a stockholder or member of the corporation at reasonable hours on business days and he may demand in writing, for a copy of excerpts from said records or minutes, at his expense." (emphasis supplied) "SECTION 75. Right to Financial Statements . Within ten (10) days from receipt of a written request of any stockholder or member, the corporation shall furnish to him its most recent financial statement, which shall include a balance sheet as of the end of the last taxable year and a profit or loss statement for said taxable year, showing in reasonable detail its assets and liabilities and the result of its operations. xxx xxx xxx" Sec. 4 of Article VI of your by-laws on file with this Commission provides, thus: "The accounts and books of the corporation, or any of them, shall be open to the inspection of the stockholder at all reasonable business hours." Generally, the right of the stockholder extends to all books, papers, contracts, minutes book or other instruments from which he can derive any information that will enable him to better protect his interests. The right has been held to extend to stock, minutes, and account books and to all books, records and papers, including the company's income tax reports. (Fletchers, Vol. 5, Ch. 18, p. 639).The right of a stockholder to make copies, abstracts, and memoranda of documents, books and papers, is an incident to the right of inspection (p. 641).The place of custody of the corporate books and records is ordinarily within the state of incorporation at the place where is located the principal business office of the corporation, and ordinarily, this localizes the place for inspection at that place. (Fletchers, Vol. 5, p. 644). Considering the foregoing, it is clear that said non-resident stockholder has the right to have the aforementioned documents such as the minutes of previous annual meeting, a report on the company's affairs and slate of nominees for Board election, mailed to him provided that he can advance the expenses for the copying and mailing of said documents. Insofar as the audited financial statements of the corporation are concerned, it is the obligation of the corporation to furnish the said stockholder said documents within ten (10) days from his written request pursuant to said Section 75. Please be advised accordingly. Very truly yours, (SGD.) MANUEL G. ABELLO Chairman