Colorado § 7-102-102 - Articles of incorporation.

§ 7-102-102. Articles of incorporation.

(1) The articles of incorporation shall state:

(a) The domestic entity name for the corporation, which domestic entity name shall comply with part 6 of article 90 of this title;

(b) The information regarding shares required by section 7-106-101;

(c) The registered agent name and registered agent address of the corporation's initial registered agent;

(d) The principal office address of the corporation's initial principal office;

(e) The true name and mailing address of each incorporator.

(f) Repealed.

(2) The articles of incorporation may, but need not, state:

(a) The names and addresses of the individuals who are elected to serve as the initial directors;

(b) Provisions not inconsistent with law regarding:

(I) The purpose or purposes for which the corporation is incorporated;

(II) Managing the business of the corporation and regulating its affairs;

(III) Defining, limiting, and regulating the powers of the corporation, its board of directors, and its shareholders;

(IV) A par value for authorized shares or classes of shares;

(V) The imposition of personal liability on shareholders for the debts of the corporation to a stated extent and upon stated conditions;

(c) Any provision that under articles 101 to 117 of this title is required or permitted to be stated in the bylaws;

(d) A provision eliminating or limiting the liability of a director to the corporation or its shareholders for money damages for any action taken, or any failure to take any action, as a director, except liability for:

(I) The amount of a financial benefit received by a director to which the director is not entitled;

(II) An intentional infliction of harm on the corporation or the shareholders;

(III) A violation of section 7-108-405; or

(IV) An intentional violation of criminal law; and

(e) A provision limiting or eliminating a duty of a director or any other person to offer the corporation the right to have or participate in any, or one or more classes or categories of, business opportunities, before the pursuit or taking of the opportunity by the director or other person if any application of the provision to an officer or a related person of that officer:

(I) Requires a determination by the board of directors by action of the disinterested directors taken in compliance with the procedures set forth in section 7-108-402 after the effective date of the provision applying the provision to a particular officer or any related person of that officer; and

(II) May be limited by the authorizing action of the board.

(3) For corporations incorporated after December 31, 1958, if cumulative voting is not desired in the election of directors, a statement to that effect shall be made in the articles of incorporation. If no such statement is made, cumulative voting shall be mandatory in the election of directors, subject to the provisions of section 7-107-209. For corporations incorporated before January 1, 1959, the articles of incorporation shall state whether cumulative voting shall be allowed in the election of directors; and, if the articles of incorporation allow cumulative voting, shareholders shall be permitted to cumulate their shares in the election of directors as provided in section 7-107-209.

(4) The articles of incorporation need not state any of the corporate powers enumerated in articles 101 to 117 of this title.

(5) If articles 101 to 117 of this title condition any matter upon the presence of a provision in the bylaws, the condition is satisfied if such provision is present either in the articles of incorporation or the bylaws. If articles 101 to 117 of this title condition any matter upon the absence of a provision in the bylaws, the condition is satisfied only if the provision is absent from both the articles of incorporation and the bylaws.

Source: L. 93: Entire article added, p. 743, § 1, effective July 1, 1994. L. 2000: (1)(a) amended, p. 977, § 51, effective July 1. L. 2002: (1)(f) repealed, p. 1846, § 105, effective July 1; (1)(f) repealed, p. 1711, § 104, effective October 1. L. 2003: IP(1), (1)(a), (1)(c), (1)(d), IP(2), (2)(b)(V), (2)(c), and (4) amended, p. 2314, § 220, effective July 1, 2004. L. 2004: (1)(e) and (2)(a) amended, p. 1496, § 248, effective July 1. L. 2006: (2)(a) amended, p. 879, § 68, effective July 1. L. 2008: (1)(e) amended, p. 24, § 18, effective August 5. L. 2019: (2)(b)(V) amended and (2)(d) and (2)(e) added, (SB 19-086), ch. 166, p. 1925, § 28, effective July 1, 2020.

ANNOTATION

Law reviews. For article, "Organizational Problems of the Small Business Corporation", see 27 Dicta 79 (1950). For note, "Blank Stock Provisions — An Unlimited Delegation of Authority to the Board of Directors", see 22 Rocky Mt. L. Rev. 312 (1950). For article, "1959 Amendments to the Colorado Corporation Code", see 36 Dicta 489 (1959). For article, "The 1985 Proposed Revisions to the Colorado Corporation Code", see 14 Colo. Law. 34 (1985). For article, "Corporate Director Liability", see 65 Den. U. L. Rev. 59 (1988). For article, "1988 Update on Colorado Tort Reform Legislation — Part II", see 17 Colo. Law. 1949 (1988). For article, "2019 Colorado Business Law Updates: Revising the Colorado Business Corporation Act and the Colorado Corporations and Associations Act", see 48 Colo. Law. 26 (Nov. 2019).

Annotator's note. Since § 7-102-102 is similar to § 7-2-102 as it existed prior to the 1993 recodification of the "Colorado Business Corporation Act", articles 101 to 117 of title 7, cases construing that provision and its predecessors have been included in the annotations to this section.

The essential prerequisite to the formation of a corporation is articles of incorporation in form and substance as prescribed by statute. Humphreys v. Mooney, 5 Colo. 282 (1880).

But none of the statements which the articles of incorporation are directed to contain are required to be made as condition precedent to the commencement or continuance of business by the corporation. There is a broad and obvious distinction between such acts as are declared to be necessary steps in the process of incorporation and such as are required of the individuals seeking to become incorporated, but which are not made prerequisite to the assumption of corporate powers. In respect to the former, any material omission will be fatal to the existence of the corporation, and may be taken advantage of collaterally in any form in which the fact of incorporation can be called in question. In respect to the latter, the incorporation is responsible only to the government in a direct proceeding to forfeit the charter. The right to be considered a corporation and the exercise of corporate powers depends upon the fact of the performance of the particular acts named in the statute as essential to its corporate existence. Humphreys v. Mooney, 5 Colo. 282 (1880).

However, without a certificate of renewal or a bona fide attempt thereto, there is no corporation de facto, where the company does not make any attempt by certificate or otherwise to renew its life. Bonfils v. Hayes, 70 Colo. 336, 201 P. 677 (1921).

Prior to issuance of certificate of incorporation no de facto corporate status regardless of substantial attempt to comply with laws creating corporations. Bowers Bldg. Co. v. Altura Glass Co., 694 P.2d 876 (Colo. App. 1984).

No penalty for omission to comply strictly with this section. Although this section prescribes the mode of organization and what the articles of incorporation shall contain, it annexes no penalty or liability for the neglect or omission to comply strictly with it. Humphreys v. Mooney, 5 Colo. 282 (1880).

But if any one of these statutory requirements is omitted, such omission is a fatal defect and confers no de jure right to exercise corporate franchises. Bates v. Wilson, 14 Colo. 140, 24 P. 99 (1890).

This section does not require the articles of incorporation to be executed within the limits of the state. Humphreys v. Mooney, 5 Colo. 282 (1880).

Nor does this section require a meeting of the incorporators prior to the execution of the articles. Humphreys v. Mooney, 5 Colo. 282 (1880).

Notice of promoters or stockholders is not notice to corporation. Franklin Mining Co. v. O'Brien, 22 Colo. 129, 43 P. 1016 (1896).

Reasonable restrictions on the sale of corporation stock are neither against public policy nor void, as Colorado has judicially and legislatively approved restrictions on the sale of stock. Irwin v. W. End Dev. Co., 342 F. Supp. 687 (D. Colo. 1972).

Furthermore, all voting restrictions in the articles of incorporation not contrary to the statutes are valid. Hampton v. Tri-State Fin. Corp., 30 Colo. App. 420, 495 P.2d 566 (1972).

But those portions of the articles of incorporation which purport to exceed statutory authority are void. Hampton v. Tri-State Fin. Corp., 30 Colo. App. 420, 495 P.2d 566 (1972).

Entitlement of preference stock limited upon corporate dissolution. When the articles of incorporation are silent as to whether preferred stock participates in a company's equity growth, the general rule is that upon corporate dissolution, preferred shareholders are entitled to no more than the liquidation preference stated in the articles, with the holders of common stock entitled to the rest of the corporate assets. Hackbart v. Holmes, 675 F.2d 1114 (10th Cir. 1982).

Applied in Virginia Canon Toll Rd. Co. v. People ex rel. Vivian, 22 Colo. 429, 45 P. 398 (1896); Age Publ'g Co. v. Becker, 110 Colo. 319, 134 P.2d 205 (1943).