Opinion ID: 2630535
Heading Depth: 4
Heading Rank: 2

Heading: The 1999 Amendments to the Model Business Corporation Act

Text: We also find the recent amendments to the Model Business Corporation Act to be persuasive. In 1999, the MBCA amended its definition of fair value to reflect the national trend against discounts in fair value appraisals. Fair value, according to the amended definition: means the value of the corporation's shares determined: . . . (iii) without discounting for lack of marketability or minority status except, if appropriate, for amendments to the articles pursuant to section 13.02(a)(5). Model Bus. Corp. Act 3d § 13.01(4)(iii) (1984) (amended 1999). The commentary to the 1999 amendments makes clear that the change was an adoption of the more modern view that appraisal should generally award a shareholder his or her proportional interest in the corporation after valuing the corporation as a whole, rather than the value of the shareholder's shares when valued alone. MBCA § 13.01 official cmt. 2. The MBCA has long been the source of Colorado's corporate law, including the dissenters' rights statute. Colorado's first dissenters' rights statute was enacted in 1941 and has undergone numerous revisions since that time. Ch. 109, sec. 5, Ch. 41, § 57(5), 1941 Colo. Sess. Laws 344, 347. Since 1958, when Colorado adopted the first Model Business Corporation Act, the corporate code of this state has been largely modeled after the amendments and revisions to the Model Act. See Nancy A. Clodfelter et. al., An Overview of the New Colorado Business Corporation Act, 22 Colo. Law. 2337 (1993) (noting that Colorado has been a Model Act state since the enactment of the first Model act by the General Assembly in 1958). [16] In 1984, the Revised Model Business Corporation Act was published. The General Assembly followed suit in 1993 by repealing the entire Corporate Code and enacting, in large part, the 1984 Act. See Ch. 191, § 7-101-101 to § 7-117-105, 1993 Colo. Sess. Laws 732-853. The current version of Colorado's dissenters' rights statute, although amended in 1996, remains substantially the same as the 1984 Model Act. The most important part of the statute for the purpose of this case, the definition of fair value, is nearly identical to the definition found in the 1984 Model Act. Holding Company argues that because the General Assembly has not adopted the 1999 MBCA amendments we should infer that it has rejected them. We are not persuaded. It has been less than four years since the MBCA was amended, too short a period of time to infer intent from legislative inaction. [17] Because the legislature has consistently relied on the MBCA when fashioning the corporate laws of this state we find the views of the MBCA on this issue to be persuasive. See Offenbecher, ___ So.2d at ___, 2002 WL 959833 at ; Blitch, 540 S.E.2d at 670; Matthew G. Norton Co., 51 P.3d at 164 (in each of these cases, although the dissenters' rights statute was based on the 1984 MBCA and the state legislature had not yet adopted the 1999 amendments to the MBCA, the court nonetheless considered the 1999 MBCA amendments persuasive on the issue of whether to allow discounts in determining fair value); see also Copper Mountain Inc. v. Poma of America, Inc., 890 P.2d 100 (Colo.1995) (noting that the intent of the authors of a model act which has been adopted in Colorado will be presumed to be the same as the intent of the General Assembly).