Detailed Answer
When a Colorado business owner dies owning shares or membership interests in a corporation or LLC, their personal representative (executor or administrator) must locate and review the company’s formation documents and bylaws to determine rights, restrictions, and any transfer requirements. Below is a step-by-step guide to obtaining and reviewing these records under Colorado law.
1. Confirm Your Authority as Personal Representative
Before you can inspect corporate records, you must be officially appointed by the probate court. Under C.R.S. § 15-12-120 (C.R.S. § 15-12-120), the court issues Letters Testamentary or Letters of Administration. Keep certified copies of those letters on hand whenever requesting documents.
2. Obtain Articles of Incorporation or Organization
The Articles of Incorporation (for corporations) or Articles of Organization (for LLCs) are public records filed with the Colorado Secretary of State (SOS). To obtain certified copies:
- Go to the SOS Business Database at https://www.sos.state.co.us/biz/.
- Search by entity name or file number.
- Select “Order Documents” and request certified copies of the formation documents and any amendments.
3. Request Corporate Bylaws or Operating Agreement
Bylaws (for corporations) and operating agreements (for LLCs) are not public, but Colorado law permits inspection by shareholders (or their representatives). Under C.R.S. § 7-102-201 (C.R.S. § 7-102-201) and § 7-102-202 (C.R.S. § 7-102-202), you may inspect and copy “books and records” for a proper purpose:
- Send a written, dated request to the corporate secretary or LLC manager. Identify yourself as the decedent’s personal representative and cite your letters from probate court.
- Define a proper purpose, such as valuing the estate or determining transfer restrictions.
- Allow up to five business days for the company to respond.
4. If Access Is Denied, Petition the Probate Court
If the company refuses your request, you can ask the probate court to compel inspection. File a motion showing your status and purpose. The court can order production of all relevant records. Keep in mind filing fees and court deadlines.
5. Review Key Provisions
Once you have the documents, focus on these critical areas:
- Share or Membership Transfer Restrictions: Look for “right of first refusal,” “buy-sell” clauses, or consent requirements for new owners.
- Voting and Meeting Requirements: Check quorum rules, notice periods, and voting thresholds.
- Amendment Procedures: Understand how and when bylaws or operating agreements can be changed.
- Fiduciary Duties and Indemnification: Note protections for directors, managers, or officers.
Disclaimer: This article is provided for informational purposes only and does not constitute legal advice. Consult a qualified attorney before making decisions affecting your or the estate’s legal rights.
Helpful Hints
- Keep copies of all correspondence and certified documents in one folder.
- Confirm deadlines in probate court orders to avoid missing important dates.
- Ask for a certified record or company seal to ensure authenticity.
- Review any amendments to bylaws or the operating agreement—these can significantly alter rights.
- Consider hiring a forensic accountant if valuation of shares or interests is complicated.