Wyoming Shareholder Law Survey
Right to Inspect Books and Records
Wyoming shareholders have the right to inspect and corporate books and records, including: minutes of both shareholder and director meetings, accounting records, list of shareholders, by-laws, and articles of incorporation. Wyo. Stat. Ann. §§ 17-16-1601(e); 17-16-1602 (2010). The shareholder must make a written demand that gives the corporation at least five business days notice of the date on which the shareholder wishes to review the records. § 17-16-1602. The inspection must occur during regular business hours at the corporation’s principal office. § 17-16-1602.
To exercise this right, the shareholder must be a record owner of shares for at least six months and own at least 5% of all shares outstanding. § 17-16-1602(b).
The request to inspect must be made “in good faith and for a proper purpose.” § 17-16-1602(c)(i). The request must also “describe with reasonable particularity [the] purpose and the records” the shareholders wants to inspect. § 17-16-1602(c)(ii),(iii). The corporation may expand the right to inspect through its articles of incorporation or by-laws, but it may not limit this right. Wyoming Coal Mining Co. v. State, 1906, 15 Wyo. 97, 87 P. 337, reh’g denied 15 Wyo. 97, 87 P. 984.
Shareholders in a Wyoming close corporation may petition the district court relief if the directors are acting in a way that is “illegal, oppressive, fraudulent or unfairly prejudicial.” § 17-17-140.
A shareholder may also petition the district court for corporate dissolution if the shareholder can establish that the directors are acting in an “illegal, oppressive[,] or fraudulent” manner. § 17-16-1430 (ii).
In a closely-held corporation, officers/directors owe a fiduciary duty to one another. J Bar H, Inc. v. Johnson, 822 P.2d 849, 859 (Wyo. 1991). In that case, the corporation was not “technically a statutory close corporation” and the plaintiff was not a minority shareholder because she owned half the shares. Id. The court still applied the close corporation standard. Id.
To file a derivative suit, the shareholder must have been a shareholder at the time the act complained of occurred. The shareholder must also “fairly and adequately” represent the interests of the corporation. § 17-16-741.
Before filing a derivative suit, the shareholder must first make a written demand upon the corporation to take the desired action. § 17-16-742. The corporation then has 90 days to take the requested action or to reject the shareholder’s demand. § 17-16-742. However, the shareholder may file suit before the expiration of the 90-day period if “irreparable injury” would result should the shareholder be forced to wait the entire 90 days before filing suit. § 17-16-742.
A derivative suit cannot be dismissed or settled without prior court approval. § 17-16-745.