reglab/statecodes huggingface dataset:
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 4 - DEFINITIONS (§§ 7-101-401 — 7-101-402) › Section 7-101-402 - [Repealed]

Repealed by 2021 Ch. 41, § 7, eff. 4/19/2021.
L. 93: Entire article added, p. 741, § 1, effective 7/1/1994. L. 96: (7) repealed, p. 1312, § 7, effective June 1. L. 2003: (4) amended, p. 2314, § 219, effective 7/1/2004. L. 2019: (2) amended and (9) added, (SB 19-086), ch. 1924, p. 1924, § 26, effective 7/1/2020.
Section 32 of chapter 41 (HB 21-1124), Session Laws of Colorado 2021, provides that the act repealing this section applies to conduct occurring on or after April 19, 2021.
Amended by 2019 Ch. 166, § 26, eff. 7/1/2020.
L. 93: Entire article added, p. 741, § 1, effective July 1, 1994. L. 96: (7) repealed, p. 1312, § 7, effective June 1. L. 2003: (4) amended, p. 2314, § 219, effective July 1, 2004.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-501 - Short title

This part 5 shall be known and may be cited as the "Public Benefit Corporation Act of Colorado".
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 230, p. 1099, § 1, effective 4/1/2014.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-502 - Law applicable to public benefit corporations - how formed

This part 5 applies to all public benefit corporations. If a corporation elects to become a public benefit corporation under this part 5 in the manner prescribed in this part 5, it is subject in all respects to the "Colorado Business Corporation Act", articles
101
to
117
of this title, and the "Colorado Corporations and Associations Act", article
90
of this title, except to the extent this part 5 imposes additional or different requirements, in which case such additional or different requirements apply.
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 230, p. 1099, § 1, effective 4/1/2014.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-504 - Nonprofit corporations

A nonprofit corporation cannot be a constituent entity in connection with any merger with or conversion into a public benefit corporation.
Amended by 2022 Ch. 33, § 1, eff. 8/10/2022.
Amended by 2019 Ch. 166, § 27, eff. 7/1/2020.
Amended by 2017 Ch. 386, § 2, eff. 8/9/2017.
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 1100, p. 1100, § 1, effective 4/1/2014. L. 2017: (2), (4)(b), and (4)(c) amended and (4)(d) added, (HB 17-1200), ch. 2000, p. 2000, § 2, effective August 9. L. 2019: (3) amended, (SB 19-086), ch. 1925, p. 1925, § 27, effective 7/1/2020.
Section 72 of chapter 166 (SB 19-086), Session Laws of Colorado 2019, provides that the act changing this section applies to conduct occurring on or after July 1, 2020.
2022 Ch. 33, was passed without a safety clause. See Colo. Const. art. V, § 1(3).
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-505 - Share certificates - notices regarding uncertificated shares

A share certificate issued by a public benefit corporation must note conspicuously that the corporation is a public benefit corporation formed pursuant to this part 5. A statement sent by a public benefit corporation pursuant to section
7-106-207
must state conspicuously that the corporation is a public benefit corporation formed pursuant to this part 5.
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 230, p. 1102, § 1, effective 4/1/2014.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-506 - Duties of directors

(1)
The board of directors shall manage or direct the business and affairs of a public benefit corporation in a manner that balances the pecuniary interests of the shareholders, the best interests of those materially affected by the corporation's conduct, and the specific public benefit identified in its articles of incorporation.
(2)
A director of a public benefit corporation:
(a)
Does not, by virtue of the public benefit provisions of section
7-101-503 (1)
, have a duty to any person on account of an interest of the person in the public benefit identified in the articles of incorporation or on account of an interest materially affected by the corporation's conduct; and
(b)
With respect to a decision implicating the balance requirement in subsection (1) of this section, will be deemed to satisfy the director's fiduciary duties to shareholders and the corporation if the director's decision is both informed and disinterested and not such that no person of ordinary, sound judgment would approve.
(3)
For the purposes of this section, a director's ownership of or other interest in the stock of a public benefit corporation does not, alone, create a conflict of interest on the part of the director with respect to the director's decision implicating the balancing requirement in subsection (1) of this section, except to the extent that the ownership or interest would create a conflict of interest if the corporation was not a public benefit corporation. In the absence of a conflict of interest, a failure to satisfy the balancing requirement specified in subsection (1) of this section does not, for the purposes of section
7-108-401
or
7-108-403
or article
109
of this title 7, constitute an act or omission that is not in good faith or a breach of the duty of loyalty.
Amended by 2022 Ch. 33, § 2, eff. 8/10/2022.
Amended by 2019 Ch. 166, § 66, eff. 7/1/2020.
Amended by 2017 Ch. 386, § 3, eff. 8/9/2017.
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 1102, p. 1102, § 1, effective 4/1/2014. L. 2017: (3) amended, (HB 17-1200), ch. 2001, p. 2001, § 3, effective August 9. L. 2019: (3) amended, (SB 19-086), ch. 1965, p.1965, § 66, effective 7/1/2020.
Section 72 of chapter 166 (SB 19-086), Session Laws of Colorado 2019, provides that the act changing this section applies to conduct occurring on or after July 1, 2020.
2022 Ch. 33, was passed without a safety clause. See Colo. Const. art. V, § 1(3).
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-508 - Actions to enforce requirements of section 7-101-506 (1)

(1)
Any action to enforce the requirements of section
7-101-506 (1)
, including any individual, derivative, or other type of action, may not be brought unless the parties bringing the action own, individually or collectively, as of the date of instituting the action, either:
(a)
At least two percent of the corporation's outstanding shares; or
(b)
In the case of a corporation with shares listed on a national securities exchange:
(I)
Two percent of the corporation's outstanding shares; or
(II)
Shares of the corporation with a market value of at least two million dollars.
(2)
This section does not relieve the parties bringing an action described in subsection (1) of this section from complying with other conditions applicable to a derivative action, including any rules of the court in which the action is filed.
Amended by 2022 Ch. 33, § 3, eff. 8/10/2022.
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 230, p. 1103, § 1, effective 4/1/2014.
2022 Ch. 33, was passed without a safety clause. See Colo. Const. art. V, § 1(3).
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 101 - GENERAL PROVISIONS - BUSINESS CORPORATIONS (§§ 7-101-101 — 7-101-509) › Part 5 - PUBLIC BENEFIT CORPORATIONS (§§ 7-101-501 — 7-101-509) › Section 7-101-509 - No effect on other corporations

(1)
The existence of a provision of this part 5 does not of itself create an implication that a contrary or different rule of law is or would be applicable to a corporation or other entity that is not a public benefit corporation.
(2)
Except as provided in section
7-101-504
, this part 5 does not affect a statute or rule of law that applies to a corporation that is not a public benefit corporation.
Amended by 2022 Ch. 33, § 4, eff. 8/10/2022.
Amended by 2017 Ch. 386, § 5, eff. 8/9/2017.
Added by 2013 Ch. 230, § 1, eff. 4/1/2014.
L. 2013: Entire part added, (HB 13-1138), ch. 230, p. 1103, § 1, effective 4/1/2014. L. 2017: Entire section amended, (HB 17-1200), ch. 386, p. 2001, § 5, effective August 9.
2022 Ch. 33, was passed without a safety clause. See Colo. Const. art. V, § 1(3).
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-101 - Incorporators

One or more persons may act as the incorporator or incorporators of a corporation by delivering articles of incorporation to the secretary of state, for filing pursuant to part 3 of article
90
of this title. An incorporator who is an individual shall be of the age of eighteen years or older.
L. 93: Entire article added, p. 742, § 1, effective 7/1/1994. L. 2002: Entire section amended, p. 1846, § 104, effective July 1; entire section amended, p. 1711, § 103, effective October 1. L. 2004: Entire section amended, p. 1496, § 247, effective July 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-103 - Incorporation

(1)
A corporation is incorporated when the articles of incorporation are filed by the secretary of state or, if a delayed effective date is stated pursuant to section
7-90-304
in the articles of incorporation as filed by the secretary of state and if a statement of change revoking the articles of incorporation is not filed before such effective date, on such delayed effective date. The corporate existence begins upon incorporation.
(2)
The secretary of state's filing of the articles of incorporation is conclusive that all conditions precedent to incorporation have been met.
L. 93: Entire article added, p. 744, § 1, effective 7/1/1994. L. 96: (2) amended, p. 1312, § 8, effective June 1. L. 2002: (1) amended, p. 1859, § 157, effective July 1; (1) amended, p. 1711, § 105, effective October 1. L. 2003: (1) amended, p. 2314, § 221, effective 7/1/2004. L. 2004: (1) amended, p. 1496, § 249, effective July 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-104 - Unauthorized assumption of corporate powers

All persons purporting to act as or on behalf of a corporation without authority to do so and without good faith belief that they have such authority shall be jointly and severally liable for all liabilities incurred or arising as a result thereof.
L. 93: Entire article added, p. 744, § 1, effective 7/1/1994.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-105 - Organization of corporation

(1)
After incorporation:
(a)
If initial directors are not elected in the articles of incorporation, the incorporators may hold a meeting, at the call of a majority of the incorporators, to adopt initial bylaws, if desired, and to elect a board of directors; and
(b)
The initial directors may hold a meeting, at the call of a majority of the directors, to adopt bylaws, if desired, to appoint officers, and to carry on any other business.
(2)
Action required or permitted by articles
101
to
117
of this title to be taken by incorporators at an organizational meeting may be taken without a meeting if the action is taken in the manner provided in section
7-108-202
for action by directors without a meeting.
(3)
An organizational meeting may be held in or out of this state.
L. 93: Entire article added, p. 744, § 1, effective 7/1/1994.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-106 - Bylaws

(1)
The board of directors or, if no directors have been elected, the incorporators may adopt initial bylaws. If neither the incorporators nor the board of directors have adopted initial bylaws, the shareholders may do so.
(2)
The bylaws of a corporation may contain any provision for managing the business and regulating the affairs of the corporation that is not inconsistent with law or with the articles of incorporation.
L. 93: Entire article added, p. 745, § 1, effective 7/1/1994.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-107 - Emergency bylaws

(1)
Unless otherwise provided in the articles of incorporation, the board of directors may adopt bylaws to be effective only in an emergency as defined in subsection (4) of this section. The emergency bylaws, which are subject to amendment or repeal by the shareholders, may include all provisions necessary for managing the corporation during the emergency, including:
(a)
Procedures for calling a meeting of the board of directors;
(b)
Quorum requirements for the meeting; and
(c)
Designation of additional or substitute directors.
(2)
All provisions of the regular bylaws consistent with the emergency bylaws shall remain in effect during the emergency. The emergency bylaws shall not be effective after the emergency ends.
(3)
Corporate action taken in good faith in accordance with the emergency bylaws:
(a)
Binds the corporation; and
(b)
May not be the basis for imposition of liability on any director, officer, employee, or agent of the corporation on the ground that the action was not authorized corporate action.
(4)
An emergency exists for the purposes of this section if a quorum of the directors cannot readily be obtained because of some catastrophic event.
L. 93: Entire article added, p. 745, § 1, effective 7/1/1994.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 102 - INCORPORATION (§§ 7-102-101 — 7-102-108) › Section 7-102-108 - Forum selection - definition

(1)
The articles of incorporation or the bylaws may require that any or all internal corporate claims must be brought exclusively in any specified court of this state and, if so specified, in any additional courts in this state or in any other jurisdiction with which the corporation has a reasonable relationship.
(2)
A provision of the articles of incorporation or bylaws specified in subsection (1) of this section does not confer jurisdiction on any court or over any person or claim and does not apply if none of the courts specified by the provision has the requisite personal and subject-matter jurisdiction. If a court specified in a provision specified in subsection (1) of this section does not have the requisite personal and subject-matter jurisdiction and another court of this state does have that jurisdiction, the internal corporate claim may be brought:
(a)
In the other court of this state, notwithstanding that the other court is not specified in the provision; and
(b)
In any other court specified in the provision that has the requisite jurisdiction.
(3)
No provision of the articles of incorporation or the bylaws may prohibit bringing an internal corporate claim in the courts of this state or require the claims to be determined by arbitration.
(4)
"Internal corporate claim" means:
(a)
Any claim that is based upon a violation of a duty under the laws of this state by a current or former director, officer, or shareholder in that capacity;
(b)
A derivative action or proceeding brought on behalf of the corporation;
(c)
An action asserting a claim arising pursuant to any provision of articles
101
to
117
of this title 7, the articles of incorporation, or bylaws; or
(d)
An action asserting a claim governed by the internal affairs doctrine that is not included in subsections (4)(a) to (4)(c) of this section.
Added by 2019 Ch. 166, § 29, eff. 7/1/2020.
L. 2019: Entire section added, (SB 19-086), ch. 1926, p. 1926, § 29, effective 7/1/2020.
Section 72 of chapter 166 (SB 19-086), Session Laws of Colorado 2019, provides that the act adding this section applies to conduct occurring on or after July 1, 2020.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 103 - PURPOSES AND POWERS (§§ 7-103-101 — 7-103-106) › Section 7-103-101 - Purposes and applicability

(1)
Every corporation incorporated under articles
101
to
117
of this title has the purpose of engaging in any lawful business unless a more limited purpose is stated in the articles of incorporation.
(2)
Where another statute of this state requires that corporations of a particular class shall be formed or incorporated exclusively thereunder, corporations of that class shall be formed or incorporated under such other statute.
(3)
Where another statute of this state requires corporations of a particular class to be formed or incorporated under that other statute and also under general corporation law, such corporations shall be formed or incorporated under such other law and, in addition thereto, under articles
101
to
117
of this title to the extent general corporation law is applicable.
(4)
Where another statute of this state permits corporations of a particular class to be formed or incorporated either under such statute or under the general corporation law, a corporation of that class may at the election of its incorporators be formed or incorporated under articles
101
to
117
of this title. Unless the articles of incorporation of such corporation indicate that it is formed or incorporated under such other alternate statute, the corporation shall for all purposes be considered as formed and incorporated under articles
101
to
117
of this title.
(5)
Articles
101
to
117
of this title shall apply to corporations of every class, whether or not included in the term "corporation" as defined in section
7-101-401 (11)
, that are formed or incorporated under and governed by other statutes of this state, to the extent that said articles are not inconsistent with such other statutes. Notwithstanding the foregoing, except as permitted by section
7-123-101 (8)
, articles
101
to
117
of this title shall not apply to nonprofit corporations:
(a)
Formed under articles
121
to
137
of this title;
(b)
Governed by articles
121
to
137
of this title pursuant to section
7-137-101 (2)
; or
(c)
Governed by articles
121
to
137
of this title by reason of an election pursuant to section
7-137-201
.
L. 93: Entire article added, p. 745, § 1, effective 7/1/1994. L. 96: (5) amended, p. 1312, § 9, effective June 1. L. 97: (5) amended, p. 761, § 26, effective 7/1/1998. L. 2003: Entire section amended, p. 2314, § 222, effective 7/1/2004. L. 2006: (5) amended, p. 879, § 69, effective July 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 103 - PURPOSES AND POWERS (§§ 7-103-101 — 7-103-106) › Section 7-103-103 - Emergency powers

(1)
In anticipation of or during an emergency defined in subsection (4) of this section, the board of directors may:
(a)
Modify lines of succession to accommodate the incapacity of any director, officer, employee, or agent; and
(b)
Relocate the principal office or additional offices or regional offices, or authorize the officers to do so.
(2)
During an emergency as contemplated in subsection (4) of this section, unless emergency bylaws provide otherwise:
(a)
Notice of a meeting of the board of directors need be given only to those directors whom it is practicable to reach and may be given in any practicable manner, including by publication or radio; and
(b)
One or more officers of the corporation present at a meeting of the board of directors may be deemed to be directors for the meeting, in order of rank and within the same rank in order of seniority, as necessary to achieve a quorum.
(3)
Corporate action taken in good faith during an emergency under this section to further the ordinary business affairs of the corporation:
(a)
Binds the corporation; and
(b)
May not be the basis for the imposition of liability on any director, officer, employee, or agent of the corporation on the ground that the action was not authorized corporate action.
(4)
An emergency exists for purposes of this section if a quorum of the directors cannot readily be obtained because of some catastrophic event.
L. 93: Entire article added, p. 747, § 1, effective 7/1/1994. L. 2003: (1)(b) amended, p. 2315, § 224, effective 7/1/2004.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 103 - PURPOSES AND POWERS (§§ 7-103-101 — 7-103-106) › Section 7-103-104 - Ultra vires

(1)
Except as provided in subsection (2) of this section, the validity of corporate action may not be challenged on the ground that the corporation lacks or lacked power to act.
(2)
A corporation's power to act may be challenged:
(a)
In a proceeding by a shareholder against the corporation to enjoin the act;
(b)
In a proceeding by or in the right of the corporation, whether directly, derivatively, or through a receiver, trustee, or other legal representative, against an incumbent or former director, officer, employee, or agent of the corporation; or
(c)
In a proceeding by the attorney general under section
7-114-301
.
(3)
In a shareholder's proceeding under paragraph (a) of subsection (2) of this section to enjoin an unauthorized corporate act, the court may enjoin or set aside the act, if it would be equitable to do so and if all affected persons are parties to the proceeding, and may award damages for loss, other than anticipated profits, suffered by the corporation or another party because of the injunction.
L. 93: Entire article added, p. 748, § 1, effective 7/1/1994. L. 96: (3) amended, p. 1313, § 11, effective June 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 103 - PURPOSES AND POWERS (§§ 7-103-101 — 7-103-106) › Section 7-103-105 - [Repealed]

L. 93: Entire article added, p. 749, § 1, effective 7/1/1994. L. 2003: (2) added by revision, pp. 2356, 2357, §§ 347, 348.
Subsection (2) provided for the repeal of this section, effective July 1, 2004. (See L. 2003, pp. 2356, 2357.)
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 104 - NAME (§§ 7-104-101 — 7-104-102) › Section 7-104-101 - [Repealed]

L. 93: Entire article added, p. 749, § 1, effective 7/1/1994. L. 94: (2)(i) added, p. 87, § 13, effective July 1. L. 96: (2) amended, p. 1313, § 12, effective June 1. L. 2000: Entire section repealed, p. 990, § 109, effective July 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 104 - NAME (§§ 7-104-101 — 7-104-102) › Section 7-104-102 - [Repealed]

L. 93: Entire article added, p. 750, § 1, effective 7/1/1994. L. 2000: Entire section repealed, p. 990, § 109, effective July 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 105 - OFFICE AND AGENT (§§ 7-105-101 — 7-105-104) › Section 7-105-101 - Registered office and registered agent

(1)
Part 7 of article
90
of this title, providing for registered agents and service of process, applies to corporations incorporated under or subject to articles
101
to
117
of this title.
(2)
(Deleted by amendment, L. 2003, p. 2315, § 225, effective July 1, 2004.)
L. 93: Entire article added, p. 751, § 1, effective 7/1/1994. L. 2003: Entire section amended, p. 2315, § 225, effective 7/1/2004.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 105 - OFFICE AND AGENT (§§ 7-105-101 — 7-105-104) › Section 7-105-102 - [Repealed]

L. 93: Entire article added, p. 751, § 1, effective 7/1/1994. L. 2000: (1)(a) amended, p. 978, § 54, effective July 1. L. 2002: IP(1), (1)(e), and (2) amended, p. 1847, § 106, effective July 1; IP(1), (1)(e), and (2) amended, p. 1711, § 106, effective October 1. L. 2003: (3) added by revision, pp. 2356, 2357, §§ 347, 348.
Subsection (3) provided for the repeal of this section, effective July 1, 2004. (See L. 2003, pp. 2356, 2357.)
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 105 - OFFICE AND AGENT (§§ 7-105-101 — 7-105-104) › Section 7-105-103 - [Repealed]

L. 93: Entire article added, p. 752, § 1, effective 7/1/1994. L. 96: (2) amended, p. 1314, § 13, effective June 1. L. 2002: (1) and (2) amended, p. 1847, § 107, effective July 1; (1) and (2) amended, p. 1712, § 107, effective October 1. L. 2003: (4) added by revision, pp. 2356, 2357, §§ 347, 348.
Subsection (4) provided for the repeal of this section, effective July 1, 2004. (See L. 2003, pp. 2356, 2357.)
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 105 - OFFICE AND AGENT (§§ 7-105-101 — 7-105-104) › Section 7-105-104 - [Repealed]

L. 93: Entire article added, p. 752, § 1, effective 7/1/1994. L. 2003: (4) added by revision, pp. 2356, 2357, §§ 347, 348.
Subsection (4) provided for the repeal of this section, effective July 1, 2004. (See L. 2003, pp. 2356, 2357.)
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 1 - SHARES (§§ 7-106-101 — 7-106-105) › Section 7-106-101 - Authorized shares

(1)
The articles of incorporation shall state the classes of shares and the number of shares of each class that the corporation is authorized to issue. If more than one class of shares is authorized, the articles of incorporation shall state a distinguishing designation for each class, and, before the issuance of shares of any class, the preferences, limitations, and relative rights of that class shall be stated in the articles of incorporation. All shares of a class shall have preferences, limitations, and relative rights identical with those of other shares of the same class except to the extent otherwise permitted by section
7-106-102
.
(2)
The articles of incorporation shall authorize:
(a)
One or more classes of shares that together have unlimited voting rights; and
(b)
One or more classes of shares, which may be the same class or classes as those with voting rights, that together are entitled to receive the net assets of the corporation upon dissolution.
(3)
The articles of incorporation may authorize one or more classes of shares that:
(a)
Have special, conditional, or limited voting rights, or no right to vote; except that no condition, limitation, or prohibition on voting shall eliminate any right to vote provided by section
7-110-104
;
(b)
Are redeemable or convertible as stated in the articles of incorporation:
(I)
At the option of the corporation, the shareholder, or another person or upon the occurrence of a designated event;
(II)
For money, indebtedness, securities, or other property; or
(III)
In a designated amount or in an amount determined in accordance with a designated formula or by reference to extrinsic facts or events;
(c)
Entitle the holders to distributions calculated in any manner, including dividends that may be cumulative, noncumulative, or partially cumulative; or
(d)
Have preference over any other class of shares with respect to distributions, including dividends and distributions upon the dissolution of the corporation.
(4)
The description of the preferences, limitations, and relative rights of classes of shares in subsection (3) of this section is not exhaustive.
L. 93: Entire article added, p. 753, § 1, effective 7/1/1994. L. 2003: IP(3)(b) amended, p. 2316, § 226, effective 7/1/2004. L. 2006: (1) amended, p. 880, § 70, effective July 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 1 - SHARES (§§ 7-106-101 — 7-106-105) › Section 7-106-102 - Terms of class or series determined by board of directors

(1)
If the articles of incorporation so provide, the board of directors may determine, in whole or in part, the preferences, limitations, and relative rights, within the limits set forth in section
7-106-101
, of:
(a)
Any class of shares before the issuance of any shares of that class; or
(b)
One or more series within a class before the issuance of any shares of that series.
(2)
Each series of a class shall be given a distinguishing designation.
(3)
All shares of a series shall have preferences, limitations, and relative rights identical with those of other shares of the same series and, except to the extent otherwise provided in the description of the series, with those of other series of the same class.
(4)
Before issuing any shares of a class or series, the preferences, limitations, and relative rights of which are determined by the board of directors under this section, the corporation shall deliver to the secretary of state, for filing pursuant to part 3 of article
90
of this title, articles of amendment to the articles of incorporation, which are effective without shareholder action, that state:
(a)
The domestic entity name of the corporation;
(b)
The text of the amendment determining the designations, preferences, limitations, and relative rights of the class or series of shares;
(c)
The date the amendment was adopted; and
(d)
A statement that the amendment was duly adopted by the board of directors.
L. 93: Entire article added, p. 754, § 1, effective 7/1/1994. L. 2002: IP(4) amended, p. 1847, § 108, effective July 1; IP(4) amended, p. 1712, § 108, effective October 1. L. 2003: IP(4) and (4)(a) amended, p. 2316, § 227, effective 7/1/2004.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 1 - SHARES (§§ 7-106-101 — 7-106-105) › Section 7-106-103 - Issued and outstanding shares

(1)
A corporation may issue the number of shares of each class or series authorized by the articles of incorporation. Shares that are issued are outstanding shares until they are reacquired, redeemed, converted, or canceled.
(2)
The reacquisition, redemption, or conversion of outstanding shares is subject to the limitations contained in subsection (3) of this section and is subject to section
7-106-401
.
(3)
At all times that shares of the corporation are outstanding, one or more shares that together have unlimited voting rights and one or more shares that together are entitled to receive the net assets of the corporation upon dissolution shall be outstanding.
L. 93: Entire article added, p. 754, § 1, effective 7/1/1994.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 1 - SHARES (§§ 7-106-101 — 7-106-105) › Section 7-106-104 - Fractional shares

(1)
A corporation may:
(a)
Issue fractions of a share or pay in cash the value of fractions of a share;
(b)
Arrange for disposition of fractional shares by the shareholders; or
(c)
Issue scrip in registered form entitling the holder to receive a full share upon surrendering enough scrip to equal a full share.
(2)
Each certificate representing scrip shall be conspicuously labeled "scrip" and shall contain the information required to be included in a share certificate by sections
7-106-206 (2)(a), (2)(c), and (4)
and
7-106-208 (2)
.
(3)
The holder of a fractional share is entitled to exercise the rights of a shareholder, including the right to vote, to receive dividends, and to participate in the assets of the corporation upon liquidation. The holder of scrip is not entitled to any of these rights unless the scrip provides for them.
(4)
The board of directors may authorize the issuance of scrip subject to any condition considered desirable, including:
(a)
That the scrip will become void if not exchanged for full shares before a stated date; and
(b)
That the shares for which the scrip is exchangeable may be sold and the proceeds paid to the scripholders.
Amended by 2023 Ch. 441,§ 1, eff. 8/7/2023.
L. 93: Entire article added, p. 755, § 1, effective 7/1/1994. L. 2003: (4)(a) amended, p. 2316, § 228, effective 7/1/2004.
2023 Ch. 441, was passed without a safety clause. See Colo. Const. art. V, § 1(3).
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 1 - SHARES (§§ 7-106-101 — 7-106-105) › Section 7-106-105 - Reverse split

(1)
Unless otherwise provided in the articles of incorporation, the outstanding shares of a class or series may be reduced to a lesser number of shares by a reverse split made on the terms set forth in this section.
(2)
To effect the reverse split, each outstanding share of the class or series shall be divided by the same divisor as is every other such share.
(3)
Each share of the class or series shall have, after the reverse split, such par value, if any, as may be stated in the articles of incorporation.
(4)
If the articles of incorporation are to be amended in connection with the reverse split, whether to change the number of authorized shares of such class or series or the par value, if any, of the shares of such class or series or for any other reason, such amendment shall be effected pursuant to article
110
of this title.
(5)
In lieu of issuing fractional shares upon such reverse split, the corporation may take any of the actions provided for in section
7-106-104
.
(6)
For the reverse split to be effected:
(a)
The board of directors shall recommend the reverse split to the holders of shares of the class or series that is to be reverse split and to each other voting group that is entitled, by reason of any provision in the articles of incorporation, to vote on the reverse split, unless the board of directors determines that, because of conflict of interest or other special circumstances, it should make no recommendation and communicates the basis for its determination to the shareholders with the submission of the reverse split; and
(b)
The holders of shares of the class or series that is to be reverse split, and each other voting group that is entitled, by reason of any provision in the articles of incorporation, to vote on the reverse split, shall approve the reverse split.
(7)
The board of directors may condition the effectiveness of the reverse split on any basis.
(8)
The corporation shall give notice, in accordance with section
7-107-105
, to each shareholder entitled to vote on the reverse split, of the shareholders' meeting at which the reverse split will be voted upon. The notice of the meeting shall state that the purpose, or one of the purposes, of the meeting is to consider the reverse split, and the notice shall contain or be accompanied by a copy or a summary of the reverse split.
(9)
Unless articles
101
to
117
of this title, the articles of incorporation, bylaws adopted by the shareholders, or the proposing board of directors require a greater vote, the reverse split shall be approved by the votes required by sections
7-107-206
and
7-107-207
by every voting group entitled to vote on the reverse split.
L. 96: Entire section added, p. 1314, § 14, effective June 1.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 2 - ISSUANCE OF SHARES (§§ 7-106-201 — 7-106-209) › Section 7-106-201 - Subscription for shares

(1)
A subscription for shares entered into before incorporation is irrevocable for six months unless the subscription agreement provides a longer or shorter period or all the subscribers agree to revocation before the time the corporation is incorporated and accepts the subscription.
(2)
The acceptance by the corporation of a subscription entered into before incorporation and the authorization of the issuance of shares pursuant thereto are subject to section
7-106-202
.
(3)
The board of directors may determine the payment terms of subscriptions for shares that were entered into before incorporation, unless the subscription agreement states them. A call for payment by the board of directors shall be uniform so far as practicable as to all shares of the same class or series, unless the subscription agreement states otherwise.
(4)
Shares issued pursuant to subscriptions entered into before incorporation are fully paid and nonassessable when the corporation receives the consideration stated in the subscription agreement.
(5)
If a subscriber defaults in payment of money or other property under a subscription agreement entered into before incorporation, the corporation may collect the amount owed as it might collect any other debt. Alternatively, unless the subscription agreement provides otherwise, the corporation may rescind the agreement and may sell the shares if the debt remains unpaid more than twenty days after the corporation sends written demand for payment to the subscriber.
(6)
A subscription agreement entered into after incorporation is a contract between the subscriber and the corporation subject to section
7-106-202
.
L. 93: Entire article added, p. 755, § 1, effective 7/1/1994. L. 2003: (3) and (4) amended, p. 2316, § 229, effective 7/1/2004.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 2 - ISSUANCE OF SHARES (§§ 7-106-201 — 7-106-209) › Section 7-106-202 - Issuance of shares

(1)
The powers granted in this section to the board of directors may be reserved to the shareholders by the articles of incorporation.
(2)
Subject to the limitations set forth in subsection (5) of this section, the board of directors may authorize the issuance of shares for consideration consisting of any tangible or intangible property or benefit to the corporation, including cash, promissory notes, services performed, and other securities of the corporation.
(3)
Before the corporation issues shares, the board of directors shall determine that the consideration received or to be received for the shares to be issued is adequate. In the absence of fraud in the transaction, that determination by the board of directors is conclusive insofar as the adequacy of such consideration relates to whether the shares are validly issued, fully paid, and nonassessable.
(4)
When the corporation receives the consideration for which the board of directors has authorized the issuance of shares, the shares issued therefor are fully paid and nonassessable.
(5)
The promissory note of a subscriber or an affiliate of the subscriber for shares shall not constitute consideration for the shares unless the note is negotiable and is secured by collateral, other than the shares, having a fair market value at least equal to the principal amount of the note. For the purposes of this subsection (5), "promissory note" means a negotiable instrument on which there is an obligation to pay independent of collateral and does not include a nonrecourse note.
(6)
Unless otherwise expressly provided in the articles of incorporation or bylaws, shares having a par value may be issued for less than the par value.
L. 93: Entire article added, p. 756, § 1, effective 7/1/1994.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 2 - ISSUANCE OF SHARES (§§ 7-106-201 — 7-106-209) › Section 7-106-203 - Liability of shareholders

(1)
A purchaser from a corporation of shares issued by the corporation is not liable to the corporation or its creditors with respect to the shares except to pay the consideration for which the shares were authorized to be issued under section
7-106-202
or stated in a subscription agreement under section
7-106-201
.
(2)
Unless otherwise provided in the articles of incorporation, a shareholder or a subscriber for shares of a corporation is not personally liable for the acts or debts of the corporation; except that such person may become personally liable by reason of the person's own acts or conduct.
(3)
Any person becoming an assignee or transferee of shares or of a subscription for shares in good faith and without knowledge or notice that the full consideration therefor has not been paid shall not be personally liable to the corporation or its creditors for any unpaid portion of such consideration.
L. 93: Entire article added, p. 757, § 1, effective 7/1/1994. L. 2003: (1) amended, p. 2317, § 230, effective 7/1/2004.
2023 Colorado Revised Statutes › Title 7 - CORPORATIONS AND ASSOCIATIONS (§§ 7-1-101 — 7-137-301) › CORPORATIONS - CONTINUED (§§ 7-101-101 — 7-137-301) › COLORADO BUSINESS CORPORATIONS (§§ 7-101-101 — 7-117-105) › Article 106 - SHARES AND DISTRIBUTIONS (§§ 7-106-101 — 7-106-402) › Part 2 - ISSUANCE OF SHARES (§§ 7-106-201 — 7-106-209) › Section 7-106-204 - Share dividends

(1)
Unless otherwise provided in the articles of incorporation, shares may be issued pro rata and without consideration to the shareholders or to the shareholders of one or more classes or series of its shares. An issuance of shares pursuant to this subsection (1) is a share dividend.
(2)
Shares of one class or series may not be issued as a share dividend in respect of shares of another class or series unless:
(a)
The articles of incorporation so authorize;
(b)
Such issuance is approved by a majority of the votes entitled to be cast by the class or series to be issued; or
(c)
There are no outstanding shares of the class or series to be issued.
(3)
The bylaws or, in the absence of an applicable bylaw, the board of directors may fix a future date as the record date for determining shareholders entitled to a share dividend. If no future record date is so fixed, the record date is the date the board of directors authorizes the share dividend.
L. 93: Entire article added, p. 757, § 1, effective 7/1/1994.