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Alaska Statutes.

Title 10. Corporations and Associations

Chapter 6. Alaska Corporations Code

Section 433. Annual Report to Shareholders; Content; Financial Statement On Request.

AS 10.06.433. Annual Report to Shareholders; Content; Financial Statement On Request.

(a) The board shall send an annual report to the shareholders not later than 180 days after the close of the fiscal year or the date on which notice of the annual meeting in the next fiscal year is sent under AS 10.06.410 , whichever is first. A corporation with less than 100 holders of record of its shares, as determined under AS 10.06.408 , is exempt from this annual requirement unless its articles or bylaws impose the requirement. The annual report must contain a balance sheet as of the end of the fiscal year and an income statement and statement of changes in financial position for the fiscal year, accompanied by a report on the fiscal year by independent accountants or, if there is no such report, the certificate of an authorized officer of the corporation that the statements were prepared without audit from the books and records of the corporation.

(b) In addition to the financial statement required by (a) of this section, unless a corporation has a nonexempt class of securities registered under 15 U.S.C. 78l (Securities Exchange Act of 1934) or files reports under Sections 43 U.S.C. 1606(c), 1607(c), and 1625 (Alaska Native Claims Settlement Act), the annual report of a corporation having 100 or more holders of record of its shares must also briefly describe

(1) all transactions, excluding compensation of officers and directors, during the previous fiscal year involving an amount in excess of $40,000, other than contracts let at competitive bid or services rendered at prices regulated by law, to which the corporation or its parent or subsidiary was a party, and in which a director or officer of the corporation or of a subsidiary or, if known to the corporation, its parent, or subsidiary, a holder of more than 10 percent of the outstanding voting shares of the corporation had a direct or indirect material interest; the report must include the name of the person, the person's relationship to the corporation, the nature of the person's interest in the transaction and, if practicable, the amount of the interest; in the case of a transaction with a partnership of which the person is a partner, only the interest of the partnership need be stated; a report is not required in the case of transactions approved by the shareholders under AS 10.06.478 ;

(2) the amount and circumstances of indemnifications or advances aggregating more than $10,000 paid during the fiscal year to an officer or director of the corporation under AS 10.06.490 ; a report is not required in the case of indemnification approved by the shareholders under AS 10.06.490 (d)(3).

(c) A shareholder or shareholders holding at least five percent of the outstanding shares of a class of a corporation may make a written request to the corporation for an income statement of the corporation for the three-month, six-month, or nine-month period of the current fiscal year ended more than 30 days before the date of the request and a balance sheet of the corporation as of the end of the period and, in addition, if an annual report for the last fiscal year has not been sent to shareholders, the statements required by (a) of this section for the last fiscal year. The statement shall be delivered or mailed to the person making the request within 30 days of the request. A copy of the statements shall be kept on file in the principal office of the corporation for 12 months and they shall be exhibited at all reasonable times to a shareholder demanding an examination of the statements or a copy of the statements shall be mailed to that shareholder.

(d) A corporation shall, upon the written request of a shareholder, mail to the shareholder a copy of the last annual, semiannual or quarterly income statement that it has prepared and a balance sheet as of the end of the period.

(e) The quarterly income statements and balance sheets referred to in this section shall be accompanied by any report on those statements by independent accountants engaged by the corporation or the certificate of an authorized officer of the corporation that the financial statements were prepared without audit from the books and records of the corporation.

(f) A corporation that neglects, fails, or refuses to prepare or submit the financial statements required by this section is subject to a penalty of $25 for each day that the failure or refusal continues, beginning 30 days after receipt of written request that the duty be performed from one entitled to make the request, up to a maximum of $1,500. The penalty shall be paid to the shareholder or shareholders jointly making the request for performance of the duty or duties imposed by this section. In addition to this penalty, the court may enforce the duty of making and mailing or delivering the information and financial statements required by this section and, for good cause shown, may extend the time limits under this section.

(g) This section applies to a domestic corporation and a foreign corporation having its principal executive office in this state or customarily holding meetings of its board in this state.

(h) A corporation may deliver the annual report required under (a) of this section

(1) by mail;

(2) in person; or

(3) by electronic transmission, or by a posting on an electronic network together with a separate notice of the specific posting to the shareholder, if the corporation has received a writing or an electronic transmission from the shareholder that includes information demonstrating that the shareholder authorized the electronic transmission and delivery of annual reports by electronic transmission or electronic posting.