North Pole, Inc., approved a plan to merge with its subsidiary, Santa’s Workshop, Inc. The merger plan provided that certain of Workshop’s shareholders would receive $3.50 per share. The highest independent appraisal of the stock was $4.04 per share. Hirschfeld, Inc., a shareholder, claimed the fair value was $16.80 per share. Workshop offered to make its corporate books and records available to Hirschfeld to assess the validity of the $16.80 demand.

This offer was declined. Hirschfeld did not attempt to base the $16.80 demand on any recognizable method of stock valuation. Hirschfeld contended it had a Chapter 44 Corporation Formation 1051 right to get the asking price. Refer to RMBCA §§ 13.02, 13.28, and 13.31.

Could Hirschfeld have blocked the merger until Workshop paid the $16.80?

Decide. [Santa’s Workshop v Hirschfeld, Inc., 851 P2d 264 (Colo App)]

AppendixLO1