Colorado SB19-086 Summary

• Comprehensive Business Entity Reform: Updates Colorado's business entity laws across multiple entity types, including corporations, nonprofits, cooperatives, and other business structures, establishing more uniform treatment across entity forms.

• Merger, Conversion, and Exchange Procedures: Modernizes procedures for business combinations by consolidating requirements, clarifying approval processes, and creating a new "exchange of owners' interests" transaction type alongside existing mergers and conversions.

• Appraisal Rights (Article 113): Establishes detailed procedures for shareholders to demand appraisal (fair value payment) in significant corporate transactions, including notice requirements, valuation methodology, and judicial proceedings for disputed valuations.

• Director Liability Standards: Clarifies standards of care and liability for directors and officers, allowing articles of incorporation to limit certain liabilities while maintaining protections for duty of loyalty violations and unlawful conduct.

• Judicial Dissolution and Share Purchase Alternative: Adds mechanism allowing corporations to avoid dissolution by permitting the corporation or other shareholders to purchase a petitioning shareholder's shares at fair value as determined by the court.