Annex B - Example of Completed Articles of Incorporation (numbered name and two classes of shares
Schedule 1: Share Rights
The corporation can issue an unlimited number of Class A shares and an unlimited number of Class B shares with the rights, privileges, restrictions and conditions set out in Schedule 1.
The holders of Class A shares are:
- entitled to vote at all meetings of shareholders except meetings at which only holders of a specified class of shares are entitled to vote;
- entitled to receive the remaining property of the corporation upon dissolution; and
- entitled, subject to the rights and privileges attaching to the Class B shares, to receive dividends as and when declared by the board of directors of the Corporation.
The holders of ClassB shares are:
- entitled to a dividend as fixed by the board of directors; and;
- entitled, upon the dissolution or liquidation of the corporation, to repayment of the amount paid for such shares (plus any declared and unpaid dividends) in priority to the Class A shares, but they shall not confer a right to any further participation in profits or assets.
The holders of Class B shares shall not be entitled to vote at meetings of the shareholders except as otherwise specifically provided for by the terms of the Canada Business Corporations Act.
Schedule 2: Restrictions on Share Transfers
The right to transfer shares of the Corporation shall be restricted in that no shareholder shall be entitled to transfer any share or shares of the Corporation without the approval of:
- the directors of the Corporation expressed by resolution passed by the votes cast by a majority of the directors of the Corporation at a meeting of the board of directors or signed by all of the directors of the Corporation; or
- the shareholders of the Corporation expressed by resolution passed by the votes cast by a majority of the shareholders who voted in respect of the resolution or signed by all shareholders entitled to vote on that resolution.
Schedule 3: Other Provisions
- The corporation's securities, other than nonconvertible debt securities, shall not be transferred without either:
- the sanction of a majority of the directors of the corporation, or
- the sanction of a majority of the shareholders of the corporation, or alternatively
- if applicable, the restriction contained in security holders' agreements.
- If authorized by by-law which is duly made by the directors and confirmed by ordinary resolution of the shareholders, the directors of the corporation may from time to time:
- borrow money upon the credit of the corporation;
- issue, reissue, sell or pledge debt obligations of the corporation; and
- mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the corporation, owned or subsequently acquired to secure any debt obligation of the corporation.
Any such by-law may provide for the delegation of such powers by the directors to such officers or directors of the corporation to such extent and in such manner as may be set out in the by-law.
Nothing herein limits or restricts the borrowing of money by the corporation on bills of exchange or promissory notes made, drawn, accepted or endorsed by or on behalf of the corporation.
- The directors may appoint one or more directors, who shall hold office for a term expiring not later than the close of the next annual general meeting of shareholders, but the total number of directors so appointed may not exceed one third of the number of directors elected at the previous annual general meeting of shareholders.
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