Bill 38 (Legislature 22, Session 2)

L22 S2 2713

Alberta — Bills

1990 BILL 38 Second Session, 22nd Legislamre, 39 Elizabeth II THE LEGISLATIVE ASSEMBLY OF ALBERTA BILL 38 LOAN AND TRUST CORPORATIONS ACT THE PROVINCIAL TREASURER Fkst Reading Second Reading Committee of tiie Whole Thkd Readmg Royal Assent

BiU 38 BILL 38 1990 LOAN AND TRUST CORPORATIONS ACT (Assented to , 1990) Table of Contents

Part 1

Interpretation and Application

Definitions 1 Relationships 2 Beneficial ownership 3 Conflicting provisions 4

Part 2 Special Purpose Trust Corporations Special purpose trust corporations 5

Part 3 Incorporation Letters Patent and Incidents of Incorporation Incorporation 6 Application 7 Conditions for issuing letters patent 8 Contents of letters patent 9 Provisions in letters patent 10 Notice of issue of letters patent 11 Fkst dkectors 12 Effective date of incorporation 13 Capacity of provincial corporation 14 No constructive notice 15 Authority of dkectors, officers and agents 16 Supplementary letters patent to amend 17 Supplementary letters patent to amalgamate 18 Issue of supplementary letters patent 19 Names 20

Organization and Commencement Fkst dkectors' meeting 21 Meeting of shareholders 22 Term of fkst dkectors 23 Carrying on business 24 No payments before registration 25 Deposit or investment before registration 26

Part 4 Registration Definition 27 Registers 28 Applications re registration 29 Particulars of application 30 Consents and undertakings 31 Power of attomey 32 Publication 33 Names 34 Rejection of application 35 Registration subject to conditions 36 Certificate of registtation 37 Time Iknit for registration 38

Part 5 Principal Place of Business, Records and Retums Principal place of business and records office 39 Record keeping 40 Additional records 41 Access to corporate records 42 Right to list of shareholders 43 Use of list 44 Trafficking in list 45 Annual retum 46 Otiier information to be given to Minister 47 Form of records 48 Legible copies 49 Protection of records 50

Part 6 Shares and Shareholders Definition 51

Interpretation 52 Application of Business Corporations Act 53 Non-par value shares 54 Classes of shares 55 Issue of shares 56 Stated capital account 57 Shares in series 58 Shareholder's pre-emptive right 59

Conversion privileges, options and rights Prohibited shareholdings Restrictions on acquisition of shares Acquisition of own shares Altemative acquisition of own shares Redemption of shares Donated and escrowed shares Reduction of stated capital Adjustment of stated capital account Repayment, acquisition and reissue of debt obligations Enforceability of contract to purchase shares Commission on sale of shares Payment of dividend Lien on share Lknited liability of shareholders Restrictions on issue, transfer

Interpretation Minister's consent to transfer or issue Minister's right to information Exemption By-laws re shareholder information Reliance on information Place of annual meeting Calling meetings Record dates Notice of meeting Shareholder proposals Shareholder list Quorum Meeting by electtonic means Majority vote One share, one vote Corporate shareholder Joint ownership of share Voting Resolution instead of meeting Meeting on requisition of shareholders Meeting called by Court Disputed elections and appointments Application of Business Corporations Act

Part 7 Dkectors and Officers 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99,100 Dkectors 101 By-laws 102 Unaffiliated dkectors 103 Residency 104 Persons disqualified from being a dkector 105 Consent to election or appointment 106 Shareholding not requked 107 Election and appomtment of dkectors 108 Cumulative votmg 109

Ceaskig to hold office ^ ^" Removal of dkectors ^ ^ ^ Dkector's statement ^^2 Notice of change of dkectors 113 Filling vacancies 1 ^^ Meetings of dkectors 115 Meetmg called by Minister 116 Meetmgs called by board 117 Notice of meetmg 118 Adjoumed meetings 119 Meetings by electtonic means 120 Quorum 121 Resident Canadian requkement 122 Majority vote 123 Executive committee 124 Officers 125 Delegation of fiduciary powers 126 Committees 127 Irregularities 128 Resolution mstead of meetmg 129 Disclosure of interest 130 Liability of dkectors and otiiers 131 Duty of care of dkectors and officers 132 Relief from duty kieffective 133 Dissent by dkector 134 Indemnification 135 RemunCTation of dkectors 136 Records of meetmgs 137

Part 8 Insider Trading Defmitions 138 Deemed insiders 139,140 CivU liabUity of kisiders 141

Part 9 Auditors and Financial Statanents Qualifications of auditor 142 Appointment of auditor 143 Auditor ceaskig to hold office 144 Removal of auditor 145 Fillkig vacancies 146 Term of office 147 Court-appointed auditor 148 Notice to Minister 149 Rights and liabiUties of auditor and former auditor 150 Auditor's statement privileged 151 Auditor's duty to examine 152 Protection from liability 153 Errors and misstatements 154 Auditor to report changes 155

Annual financial statements 156 Generally accepted accounting principles and auditing standards 157 Approval of annual financial statements 158 Copies of financial statements - provincial corporation 159 Copies of financial statements - registered extta-provincial corporation 160 Duties of audit committee 161

Part 10 Restricted Party Transactions

Interpretation 162 Designation of restricted party 163 Prohibited ttansactions, guarantees and investments 164 Person previously a restricted party 165 Type of approval requked 166 Board approval requked - general 167 Board approval not requked - general 168 Dkectors, officers, employees, etc. 169 Financial instimtions 170 Prescribed limits 171 Consent to prohibited or restricted ttansaction 172 Transaction involving tmst and estate funds 173 Delegation 174 Review procedures 175 Disclosure by restricted party 176 Duty to report conttaventions 177 Notice to Minister and auditor 178 Onus of proof 179 Applications to Court 180

Part 11 Capacity and Powers General powers 181 Restriction on engaging in deposit-taking business 182 Resttiction on fiduciary activities 183

Interpretation 184 Resttiction on loan corporations 185 Appokittnent as executor, etc. 186 Securities restrictions 187 Leasing resttiction 188 Receivmg deposits 189 Capital base 190 Borrowkig by subordmated notes 191 Pledgkig assets 192 Lknit on borrowing by trust corporation 193 Otiier prohibited activities 194

Part 12 Investments Application 195 Prudent investment standards 196 Review procedures 197 Liquidity 198 Personal loans 199 Commercial loans 200 Mortgage lending 201 Disposition of real estate 202 Investment ki real estate 203 Prohibited kivestments 204 Acquisition of assets in default 205 Equity m unincorporated entity 206 Limitation on shareholdmg 207 Divestment order 208 Collateral security 209 Allocation of security 210 Common trust funds 211 Passing accounts 212 Notice by registered extta-provincial ttust corporation 213

Part 13 Fundamental Changes and Arrangements Amalgamation Special approval Purchase or sale of assets Agreement re amalgamation or purchase and sale Shareholder approval of agreement Approval of agreement by Minister Effect of agreement to purchase or sell Effect of amalgamation Purchase of shares for amalgamation or purchase of assets Continuation of fiduciary obligations Arrangements

Part 14 Liquidation and Dissolution Staymg proceedmgs No property and no liabiUties Proposmg liquidation Certificate of intent to dissolve requked Issue of certificate Effect of certificate Revocation of certificate of intent to dissolve Liquidation process Letters patent of dissolution Dissolution Application for Court supervision 214 215 216 217 218 219 220 221 222 223 224 225 226 227 228 229 230 231 232 233 234 235

Notice to Minister 236 Effect of order 237 Commencement of liquidation 238 Powers of Court 239 Effect of order for liquidation 240 Appointment of liquidator 241 Vacancy in liquidator's office 242 Duties of liquidator 243 Powers of liquidator 244 Prohibition 245 Reliance on statements 246 Examination of otiiers 247 Restoration and compensation 248 Final accounts and discharge of liquidator 249 Shareholder's right to distribution in money 250 Letters patent of dissolution 251 Existing rights unaffected by dissolution 252 Unknown claimants 253 Custody of documents, etc. 254 Revival 255

Part 15 Administtation and Enforcement Extension of time for filing 256 Confidentiality of information 257 Delegation of powers 258 Agreements 259 Indemnity agreements 260 Approvals and consents 261 Orders, etc., binding on successors 262 Matters under oath 263 Recording of evidence 264 Notification of Minister's decision 265 Review by review board 266 Consent to apply dkectiy to Court 267 Application 268 Stay 269 Interference prohibited 270 Demand for infonnation 271 Periodic examination 272 Special examination 273 Powers of person conducting examination 274 Examination of otiier persons 275 Powers on special examination 276 Appraisal of property 277 Nfinister's order to comply 278 Voluntary compliance program 279 Suspension and revocation of registtation 280 Protection from liability 281 Order to freeze property 282 Order for compliance 283 Order imposing conditions or for possession and conttol 284

Powers of Minister 285 Termination of possession and conttol 286 Application to Court ^°' Payment of expenses of proceedmgs ^°° Dissolution by Court 289 Defmitions 290 Derivative action 291 Relief by Court from oppression or unfakness 292 Notice of application 293 Costs 294 Stay, etc. of application or action 295

Part 16 Offences and Penalties Deemed carrymg on busmess 296 Prohibition re use of name 297 Holdmg out 298 Activities by promoters, etc. 299 Exemption 300 Misuse of confidential information 301 Representations prohibited 302 False or deceptive statements 303 Otiier offences 304 Penalties 305 Continuing offence 306 Defence 307 Liability of dkectors and officers 308 Limitation on prosecution 309 Order to comply and make restitution 310 Penalty for late information 311

Part 17 General Priority of Govemment claim 312 Unclaimed deposits 313 Conttacts with minor 314 Certificate of Minister as evidence 315 Published notice as evidence 316 Copies of documents as evidence 317 Certificate of corporation as evidence 318 Photocopies of documents 319 Notices to dkectors, shareholders 320 Notices to corporation 321 Waiver of notice 322 Transfer on deatii of depositor 323 Payments by mistake 324 Regulations 325

Part 18 Transitional, Consequential, Repeal and Commencement Extension of time 326 Letters patent of contmuance 327 Registtation of continued provincial trust corporation 328 Existmg registered extta-provincial companies 329 Extta-provincial loan corporations 330 Existing dkectors and auditors 331 Committees 332 Grandfatiiering provision re mvesUnents 333 Calculation of time 334 Consequential amendments 335 Repeal 335 Comkig into force 337 HER MAJESTY, by and witii tiie advice and consent of die Legislative Assembly of Alberta, enacts as foUows: PARTI

INTERPRETATION AND APPLICATION

Definitions 1(1) In tilis Act, (a) "auditor" means, witii respect to a body corporate, its external auditor, and includes any individual who is responsible for conducting an extemal audit of the body corporate's financial statements on behalf of its extemal auditor; (b) "bank" means a bardc named in

Schedule I or II to the Bank Act (Canada); (c) "body corporate" means any body corporate with or without share capital and wherever and however incorporated; (d) "branch" means an office of a corporation where k offers services to or for the pubUc; (e) "capital base" means the shareholders' equity of a corporation calculated in the prescribed manner; (f) "Chief of Securities Administi-ation" means the Chief of Secmities Admuiistiation as defined in the Securities Act; (g) "common trust fund" means a fund maintained by a trust corporation in which money belonging to various estates and tinists in its care are combined for die purpose of facUitating investment;

(h) "corporation" means a loan corporation or a ttust corporation whetiier incorporated in or outside of Alberta; (i) "Court" means the Court of Queen's Bench; (j) "debt obligation" means a bond, debentme, note or otiier evidence of indebtedness or guarantee of a provincial corporation, whether seemed or unsecured; (k) "deposit" means, subject to subsection (2), a sum of money tiiat (

i) is paid on terms tiiat are not referable to the provision of property or services or to the giving of security, (ii) is repayable to the person making it (

A) on demand, (

B) after notice, or (

C) on a fixed date or on tiie expky of a speckled term. and (iU) is paid or payable in accordance with prescribed requkements, but does not include payments of sums of money that are prescribed; (1) "deposit-taking business" means, subject to subsection (3), (

i) the lending, in the ordinary comse of business, of money received by way of deposit, or (ii) any other activity that is financed wholly or to any materisti extent out of the capital of, or the interest on, money received by way of deposit; (m) "eligible financial institution" means a tteasury branch, credit union or member instimtion of the Canada Deposit Insmance Corporation or of any other deposit insmance or guarantee plan prescribed by the Minister; (n) "entity" includes a body corporate, tiust, partnership, fund or other unmcorporated association or organization, the Crown in right of Canada or in right of a province, an agency of the Crown, a foreign govemment and any agency of a foreign govemment, but does not include an individual; 10

(o) "extta-provincial body corporate" means a body corporate (

i) mcorporated otherwise dian by or under

an Act of the Legislatiu-e or an Ordinance of tiie North-West Territories, or (ii) incorporated by or under an Ordinance of tiie North- West Territories and not subject to die legislative authority of the Province by

section 16 of tiie Alberta Act (Canada); (p) "extta-provincial corporation" means a corporation tiiat was incorporated under the laws of Canada or of any province, otiier than Alberta; (q) "fak market rate" means (

i) ki respect of tiie acquisition or disposition of property, including a lease or rental of property, and subject to regulations made with respect to tiie valuation of property, the most probable price in terms of money that the property should bring in a competitive and open market under all conditions requisite to a fak sale or lease, assuming that the price is not affected by undue stimuli, with both the seUer and buyer acting pmdentiy and knowledgeably, (ii) subject to subclause (iU), in respect of the acquisition or provision of services, a consideration that might reasonably be expected to be obtained or given for the services in question in an arm's length ttansaction in an open market between wilUng parties to a ttansaction of that natme and on terms that, having regard to open market conditions, are competitive and not umeasonable, and (iU) in respect of the provision of services that are provided generally to customers of the provincial corporation or subsidiary in question, the rate and terms that are offered ki respect of tiiose services to customers generaUy in the ordkiary course of that corporation's or subsidiary's business; (r) "financial institution" means (

i) a securities dealer; (ii) an insurer; (iU) any member instimtion of the Canada Deposit Insurance Corporation or of any other deposit insmance or guarantee plan prescribed by the Minister; (s) "improved real estate" means 11

(

i) land on which diere exists a building or on which a buUding is being or is about to be constincted and the adjacent land used or to be used in connection with the buUdkig, (ii) land on which bona fide farming operations are being conducted, and (iU) vacant land that is restricted by law in its use to commercial, industiial or residential purposes, whether by zoning or otherwise; (t) "insttument of incorporation" means the special Act, charter, letters patent or otiier document incorporating or amalgamating a corporation, and includes aU amendments to it; (u) "insmer" means an insmer, agent, broker or adjuster within die meaning of those terms in the Insurance Act or within the meaning ascribed to any equivalent term by any equivalent stamte of another province; (v) "loan corporation" means a body corporate incorporated or operated for the purpose of carrying on a deposit-taking business but does not include a bank, a tteasury branch, a trust corporation or a credit union; (w) "market value" means the most probable price in terms of money that property should bring in a competitive and open market under all conditions requisite to a fak sale, assuming tiiat die price is not affected by undue stimuU, witii botii tiie seller and tiie buyer acting pmdentiy and knowledgeably; (x) "Minister" means the member of the Executive CouncU charged by the Lieutenant Govemor in CouncU widi die administtation of tiiis Act; (y) "officer" means, ki relation to a corporation, (

i) its chief executive officer, president, chakman, vice- president, vice-chakman, tteasmer, secretary, general manager or assistant general manager or any combination of tiiose positions, (ii) an mdividual who performs functions for the corporation normally performed by a person mentioned in subclause (i), or (iU) any other person designated as an officer by by-law or by the board of the corporation; 12

(z) "ordinary resolution" means a resolution passed by a majority of the votes cast by die shareholders who voted m respect of that resolution or signed by all the shareholders entitied to vote on that resolution; (aa) "person" means an individual, entity or personal representative; (bb) "personal representative" means an executor, administtator, guardian, committee, ttustee, assignee, receiver or liquidator; (cc) "prescribed" means (

i) witii respect to a form, in a form authorized or provided by the Minister and containing the information requked by tihe Minister, or (ii) in any other case, prescribed in or pursuant to the regulations; (dd) "professional adviser" means (

i) an auditor, (ii) a lawyer, accountant, appraiser, architect or engineer, or (iU) any otiier person whose membership in his profession would tend to lend credibility to a statement made or opinion given by hkn, and includes an individual who is a member of or works in a professional capacity for a partnership, corporation or other association of persons that is a professional adviser; (ee) "provincial corporation" means a corporation incorporated or contkiued under this Act; (ff) "real estate" means any estate or interest in land, including improvements; (gg) "registered corporation" means a corporation registered under this Act; (hh) "registered form", when appUed to a security, means a security that (

i) specifies a person entitied to die security or to die rights it evidences, and the ttansfer of which is capable of being recorded in a securities register, or 13

(ii) bears a statement that k is ki registered form; (ii) "relative", when used witii respect to mdividuals, means related by blood, marriage or adoption; (jj) "reporting issuer" means a reporting issuer within the meaning of the Securities Act; (kk) "securities dealer" means a dealer within tiie meanmg of the Securities Act or within tiie meanmg ascribed to any eqiuvalent word or phrase by any equivalent stamte of another province; (11) "security" means, except in

Part 6, security within the meaning of the Securities Act, and includes a deposit and any insttument evidencing a deposit; (mm) "special purpose tiust corporation" means a special purpose tmst corporation referred to in

Part 2; (nn) "special resolution" means a resolution passed by a majority of not less than 2/3 of die votes cast by die shareholders who voted in respect of that resolution or signed by all the shareholders entitied to vote on that resolution; (oo) "spouse" means the person of the opposite sex to whom a person is married or with whom the person is living in a conjugal relationship outside marriage; (pp) "total assets" means the assets of a corporation calculated in the prescribed manner and, m the case of a tmst corporation, includes cash and securities earmarked and set aside under

section 189(5); (qq) "tiust corporation" means a body corporate mcorporated or operated for the purposes of (

i) offering its services to the public as executor, administiator, ttustee, bailee, agent, receiver, Uquidator, sequesttator, assignee or guardian or tiustee of a minor's estate or of the estate of a mentally incompetent person, and (ii) carrymg on die deposk-takkig business, but does not include a special piupose tmst corporation, a bank, a tteasury branch, a loan corporation or a credit union; (rr) "voting share" means a share of any class of shares of a body corporate carrying votmg rights under all ckcumstances and a share of any class of shares carrying votmg rights by 14

reason of die occurrence of any contingency tiiat has occurred and is continuing.

(2) For the purposes of subsection (l)(k)(i), money is paid on terms tiiat are referable to the provision of property or services or to tiie giving of secmity if (

a) it is paid by way of advance or part payment for the sale, lease or odier provision of property or services of any kind and is repayable only in the event that tiie property or services are not ki fact sold, leased or otherwise provided, (

b) k is paid by way of security for payment for the provision of property or services of any kind provided or to be provided by the person by whom or on whose behalf the money is accepted, or (

c) it is paid by way of security for the deUvery or retum of any property, whether in a particular state of repak or otherwise.

(3) Notwithstanding subsection (1)(1), a person shall not be considered to be carrying on the deposit-taking business k (

a) the person does not hold himself out as accepting deposits on a day to day basis, and (

b) any deposits that are accepted are accepted only on particular occasions and on a basis that is ancUlary to another business purpose, whether or not in connection with the issue of debentmes or other securities. Relationships 2(1) For tiic purposcs of tiiis Act, (

a) an entity is affiliated with anotiier entity if one of them is conttoUed by the other or both of them are conttoUed by the same person, and (

b) die affUiates of an entity are deemed to be affiUated witii aU other entities witii which tiie entity is affUiated.

(2) For tiie purposes of this Act, (

a) a person conttols a body corporate if securities of the body corporate to which are attached more than 50% of the votes tiiat may be cast to elect directors of the body corporate are held or beneficially owned by die person and the votes attached to those securities are sufficient, if exercised, to elect a majority of the dkectors of the body corporate; 15

(

b) a person conttols a tiust, partnership, fund or other unmcorporated entity if more tiian 50% of die beneficial interest, however designated, kito which the entity is divided is held or beneficiaUy owned by that person and the person is able to dkect die affaks of die entity; (

c) notwithstandmg clauses (

a) and (b), a person controls an entity if the person has, in relation to the entity, any dkect or indkect kifluence that, if exercised, would result in conttol in fact of the entity.

(3) A holding body corporate is deemed to conttol any entity tiiat is conttoUed or deemed to be conttoUed by a subsidiary of the holding body corporate.

(4) An entity that conttols another entity is deemed to conttol any entity that is contioUed or deemed to be conttoUed by the other entity.

(5) For the purposes of tiiis Act, a body corporate is the holding body corporate of all of its subsidiaries.

(6) For the purposes of this Act, a body corporate is a subsidiary of another body corporate k (

a) it is contioUed by (

i) tiiat otiier, (ii) that other and one or more bodies corporate each of which is controlled by that otiier, or (iU) 2 or more bodies corporate each of which is conttoUed by that other, or (

b) it is a subsidiary of a body corporate that is that other's subsidiary.

(7) For the purposes of this Act, a person is a restiicted party witii respect to a provkicial corporation if diat person (

a) is a dkector or officer of die corporation, (

b) is an employee of tiie corporation of a prescribed class, (

c) holds or is a beneficial owner of (i) 10% or more of any class of the issued and outstanding shares of the corporation, or 16

(ii) voting shares of the corporation to which are attached 10% or more of the voting rights attaching to all of the issued and outstanding voting shares of the corporation, (

d) holds or is a beneficial owner of voting shares of an affUiate of the corporation to which are attached 10% or more of the voting rights attaching to aU of the issued and outstanding voting shares of the affiUate, (

e) is the auditor of the corporation or of any of its affiliates, in a case where the auditor is a sole practitioner, (

f) is a partner in the firm that is the auditor of the corporation or of any of its affiUates, k he is actually engaged in auditing the corporation or affiUate, (

g) is a spouse of a person referred to in clause (

a) or (c), (

h) is a relative of, or a relative of tiie spouse of, a person referred to in clause (

a) or (c), who has the same home as that person, (

i) where the holder or beneficial owner referred to in clause (

c) is a body corporate, is a dkector or officer of that body corporate, (

j) is a body corporate in which an individual referred to in clause (

a) or (

c) is the holder or beneficial owner of voting shares to which are attached 10% or more of the voting rights attachmg to aU of the issued and outstanding voting shares of the body corporate, (

k) is a body corporate tiiat is conttoUed by a person referred to ki clause (b), (e), (f), (

g) or (i), (1) is a body corporate in which tiie corporation holds or beneficially owns voting shares to which are attached 10% or more of die voting rights attaching to aU of the issued and outstanding voting shares of the body corporate, (

m) is (

i) a partner of die corporation and has a 10% or greater beneficial mterest in die partnership, or (ii) a party to and has a 10% or greater mterest in a joint ventme agreement to which die corporation is also a party and die corporation has a 10% or greater beneficial interest ki the partnership or joint ventme. 17

(

n) is an affUiate of the corporation or a dkector or officer of an affUiate of tiie corporation, or (

o) is designated under

section 163 as a restiicted party.

(8) Where ki contemplation of a person's becoming a restiicted party of a provincial corporation the person enters into a ttansaction with, or is given a guarantee by, the provkicial corporation or its subsidiary, or the corporation or its subsidiary makes an investinent in the securities of the person, the person is deemed to be a restticted party of the provincial corporation with respect to that ttansaction, guarantee or investment.

(9) Notwitiistanding subsection (7)(n), unless the regulations prescribe otherwise, a whoUy owned subsidiary of a provincial corporation is not a restiicted party with respect to diat corporation.

(10) Where he is satisfied tiiat a subsidiary of a provincial corporation functions primarily for the purpose of providing a service, other than a financial service, to the provincial corporation or its subsidiaries, the Minister may, on application, exempt the subsidiary from die status of restricted party of the corporation, subject to any terms and conditions he considers appropriate. Beneficial 3(1) por Uic purposcs of this Act, a security or other interest is owners p beneficially owned by a person when it is held dkectiy or through a personal representative or other intermediary for the use or benefk of tiiat person otiierwise than as a security interest.

(2) For the purposes of tiiis Act, a person shaU be deemed to own beneficially securities that are beneficially owned by a body corporate conttoUed by that person.

(3) For the purposes of this Act, where a person beneficially owns shares of a body corporate, die person shall be deemed to beneficially own that proportion of shares of every other body corporate that is beneficiaUy owned by the fkst-mentioned body corporate, diat is equal to the proportion of shares of tiie fkst- mentioned body corporate tiiat is beneficially owned by die person.

(4) Where subsections (2) and (3) apply to a person, only die subsection under which die person is deemed to beneficially own more securities applies to die person.

(5) If a person owns securities in a corporation tiiat itself owns securities in a body corporate, in determining die person's beneficial ownership of securities m die body corporate for the purposes of subsection (2) or (3) no regard shaU be taken of the securities of tiie body corporate that are owned by the corporation. 18

Conflicting provisions 4(1) Where there is a conflict between (

a) a provision of the instiument of incorporation or by-laws of a provincial corporation, and (

b) a provision of this Act or die regulations, the provision of this Act or the regulations, as the case may be, prevaUs.

(2) To die extent that tiiere is a confUct between tiie Business Corporations Act and tiiis Act or the regulations ki thek application to a restiicted party, tiiis Act or die regulations prevaU.

(3) Where a provision of (

a) the Securities Act or the Insurance Act, (

b) a statute of any other province or of Canada equivalent to the Securities Act or the Insurance Act, (

c) any odier prescribed statute, or (

d) tiie regulations under any statute referred to in clause (a), (

b) or (

c) applies to a subsidiary of a registered corporation and a similar or corresponding provision of this Act or the regulations under it would, but for this subsection, also apply to that subsidiary, that other provision applies, and the provision of this Act or the regulations does not apply, to the subsidiary.

(4) To die extent that there is any inconsistency in thek application to a given situation between a provision in

Part 10 tiiat prohibits or restiicts any activity and any otiier provision o^ this Act or the regulations, tiie provision in

Part 10 prevaUs.

(5) To tiie extent that there is any kiconsistency in tiiek application to a given situation between a provision in

Part 10 that permits an activity and any provision of any otiier Part of this Act that prohibits or restiicts the activity, tiiat otiier provision prevails.

PART 2 SPECIAL PURPOSE TRUST CORPORATIONS Special purpose 5(1) jhe Lieutenant Govemor ki CouncU may make regulations trust corpora tions 19

Incorporation Ai^licati(»i (

a) providing for the kicorporation of bodies corporate to be known as special purpose tiust corporations; (

b) providmg tiiat any provision of diis Act or die regulations under

section 325, eidier as k exists m diis Act or those regulations or as modkied by the regulations under diis section, applies to special purpose tmst corporations; (

c) providing for other matters respecting special purpose tiust corporations diat are not provided for or are insufficientiy provided for ki diis Act and die regulations under

section 325 and, in die opinion of the Lieutenant Govemor ki Council, are necessary for or ancUlary to the proper regulation of special purpose tmst corporations.

(2) This Act and die regulations under

section 325 do not apply to special purpose tiust corporations except to the extent that tiiey are made appUcable by regulations under subsection (1).

PART 3 INCORPORATION Letters Patent and Incidents of Incorporation 6(1) The Lieutenant Govemor in CouncU may, on die recommendation of die Minister, incorporate a provincial loan corporation or a provincial tmst corporation by the issue of letters patent on the appUcation of one or more persons.

(2) No loan corporation or tmst corporation may be incorporated in Alberta otherwise than by letters patent under this Act. 7(1) An application for letters patent to incorporate a provincial corporation shaU be in die prescribed form and shall be fUed witii the Minister.

(2) On fUkig an appUcation for letters patent, the Minister (

a) shall requke the applicant to pubUsh notice of die application containing any information the Minister requkes in The Alberta Gazette and in a newspaper having general ckculation in the locality where the principal place of business of the provincial corporation is to be located, and (

b) may requke the appUcant to provide any information, material and evidence the Minister considers necessary, in addition to the information, material and evidence requked to be provided in or with the application. 20

Conditions for issuing letters patent Contents of letters patent 8 The Lieutenant Govemor in CouncU shall not issue letters patent to incorporate a provkicial corporation unless he is satisfied tiiat (

a) k is in tiie public interest to establish an additional provincial loan or ttust corporation, as the case may be, (

b) the proposed management is fit, both as to character and as to competence, to manage the corporation, (

c) die proposed capital stiuctme and the rights, privUeges, restrictions and conditions attaching to each class of shares are acceptable to tiie Minister, (

d) each person who, based on the subscriptions for shares of the proposed corporation, wUl hold or beneficially own 10% or more of any class of shares of the proposed corporation or voting shares of the proposed corporation to which are attached 10% or more of the voting rights attaching to all of the voting shares of the proposed corporation can demonsttate the adequacy of his financial resomces and is fit as to character to hold or own the shares subscribed for, (

e) each proposed dkector is fit, botii as to character and as to competence, to be a dkector of the corporation, (

f) the depositors of the corporation will be adequately protected, (

g) the proposed plan of operation of tiie corporation is feasible, and (

h) the corporation intends to offer to tiie pubUc tiie services set out in the application for incorporation. 9 The letters patent of a provincial corporation shaU set out (

a) tiie name of tiie corporation, (

b) the classes and any maximum number of shares that the corporation is authorized to issue and die rights, privUeges, restrictions and conditions attachkig to each class of shares, (

c) die number of dkectors or, subject to

section 109(l)(a), tiie mmimum and maxunum number of dkectors of the corporation, and (

d) die fuU name, residential address, citizenship and occupation of 21

(

i) each of die first directors of the corporation, (ii) each person who, based on tiie subscriptions for shares of the corporation, wiU hold or beneficiaUy own 10% or more of any class of shares of the corporation, or voting shares of the corporation to which are attached 10% or more of the voting rights attaching to all of the voting shares of the corporation, and (iU) each of die applicants. 10 The Lieutenant Govemor in Council may set out ki die letters patent incorporating a provincial corporation any provision not conttary to this Act that he deems advisable to t^e kito account the particular ckcumstances of the corporation. 11 The Minister shaU cause to be pubUshed in The Alberta Gazette a notice of the issuance of letters patent incorporating a provincial corporation. 12 The fkst dkectors of a provincial corporation are the dkectors named in the application for letters patent to incorporate the corporation.

Effective date 13(1) A provincial Corporation comcs iuto cxisteuce OU the date of incorporation ^^j ^^ ^ ^^ j^jj^^.^ ^^^^^^

(2) Letters patent are conclusive proof for tiie purposes of this Act and for aU otiier purposes (

a) that tiie provisions of this Act in respect of kicorporation and aU requkements precedent and incidental to incorporation have been complied with, and (

b) that tiie provincial corporation has been incorporated under this Act as of the date shown in the letters patent. Provisions in letters patent Notice of issue of letters patent First directors Capacity of provincial corporation 14(1) Subject to tilis Act, tiie regulations, the by-laws and any terms, conditions and restrictions imposed on its registration, a provincial corporation (

a) has the capacity and the rights, powers and privileges of an individual, and (

b) has the capacity to carry on its business, conduct its affaks and exercise its powers in any jurisdiction outside Alberta to tiie extent that tiie laws of tiiat jurisdiction permk.

(2) A provincial corporation shall not 22

No constructive notice Authority of directors, officers and agents (

a) carry on business or exercise any power tiiat it is prohibited from carrymg on or exercising by tiiis Act, die regulations, tiie by-laws or any terms or conditions imposed on its registiation or (

b) exercise any of its powers in a manner tiiat is conttary to this Act or the regulations. 15 No person is affected by or is deemed to have notice or knowledge of die contents of a document conceming a provmcial corporation by reason only that tiie document has been filed by die Minister or is available for inspection at an office of the corporation. 16 A provincial corporation, a guarantor of an obligation of the corporation or a person claiming tiirough tiie corporation may not assert against a person deaUng witii tiie corporation or deaUng witii any person who has acquired rights from the corporation (

a) tiiat tiie insttument of incorporation or by-laws have not been compUed with, (

b) diat the persons named in the most recent notice of directors fUed by die Minister under this Act are not die directors of tiie corporation, (

c) that a person held out by the corporation as a dkector, an officer or an agent of the corporation (

i) has not been duly appointed, or (ii) has no autiiority to exercise a power or perform a duty that the director, officer or agent might reasonably be expected to exercise or perform, or (

d) that a document issued by any dkector, officer or agent of the corporation with actual or usual authority to issue tiie document is not valid or not genuine, unless the person has, or by virtue of his position with or relationship to the corporation ought to have, knowledge of those facts at the relevant time. Supplementary 17(1) On the application of a provincial corporation, the m^d^*^"' ^° Lieutenant Govemor in Council may, on die recommendation of the Minister, issue supplementary letters patent to amend die letters patent of the corporation 23

(

a) to change ks name, (

b) m die case of a provincial loan corporation, to continue it as a provincial tmst corporation, (

c) ki die case of a provincial tiust corporation, to continue it as a provincial loan corporation, (

d) to change any maximum number of shares that the corporation is authorized to issue, (

e) to create new classes of shares, (

f) to change the designation of aU or any of ks shares and add, change or remove any rights, privUeges, restiictions and conditions, including rights to accmed dividends, in respect of aU or any of its shares, whether issued or unissued, (

g) to change the shares of any class or series, whether issued or unissued, mto a different number of shares of the same class or series or into tiie same or a different number of shares of other classes or series, (

h) to divide a class of shares, whether issued or unissued, into series and fix the number of shares in each series and the rights, privileges, resttictions and conditions attaching to those shares, (

i) to autiiorize tiie dkectors to divide any class of unissued shares into series and fix the number of shares in each series and the rights, privUeges, restrictions and conditions attaching to those shares, (

j) to authorize the directors to change the rights, privUeges, resttictions and conditions attached to unissued shares of any series, (

k) to revoke, diminish or enlarge any authority conferred under clause (

i) or (j), or (1) to add, change or remove restiictions on tiie tiansfer of shares.

(2) No appUcation shall be made under under subsection (1) unless it has been authorized by a special resolution of die provkicial corporation.

(3) The holders of shares of a class or, subject to subsection (4), of a series, are entitied to vote separately as a class or series on a proposal to amend the letters patent 24

(

a) to increase or decrease any maximum number of authorized shares of that class, or increase any maximum number of authorized shares of a class having rights or privileges equal or superior to the shares of that class, (

b) to effect an exchange, reclassification or cancellation of all or part of the shares of that class, (

c) to add, change or remove the rights, privUeges, resttictions or conditions attached to the shares of that class and, without limiting the generality of tiie foregokig, are entitled to vote on a proposal (

i) to remove or change prejudiciaUy rights to accmed dividends or rights to cumulative dividends, (ii) to add, remove or change prejudicially redemption rights, (iii) to reduce or remove a dividend preference or a liquidation preference, or (iv) to add, remove or change prejudiciaUy conversion privileges, options, voting, tiansfer or re-emptive rights, rights to acquke securities of the provmcial corporation, or sinking fund provisions, (

d) to increase die rights or privileges of any class of shares having rights or privUeges equal or superior to die shares of tiiat class, (

e) to create a new class of shares having rights or privileges equal or superior to tiie rights or privUeges attached to die shares of that class, (

f) to make any class of shares having rights or privileges inferior to the shares of tiiat class equal or superior to the shares of that class, or (

g) to effect an exchange or create a right of exchange of all or part of the shares of another class into tiie shares of tiiat class.

(4) The holders of a series of shares of a class are entitied to vote separately as a series under subsection (3) if tiiat series of a class is affected by an amendment differentiy tiian other shares of die same class are affected. (5) Subsections (3) and (4) apply whetiier or not tiie shares of a class otherwise carry tiie right to vote. 25

Supplementary letters patent to amalgamate Issue of supplementary letters patent

(6) A proposal to amend referred to in subsection (3) is adopted when die holders of die shares of each class entitled to vote separately on it as a class have approved tiie amendment by a special resolution.

(7) The dkectors of a provincial corporation may, k authorized by the shareholders in the special resolution authorizing the amendment, revoke the resolution before it is acted on widiout further approval of the shareholders. 18 On the application of tiie corporations involved tiie Lieutenant Govemor m Council may, where the Minister has approved an amalgamation agreement under

section 220, issue supplementary letters patent to amalgamate the corporations and continue them as one provkicial corporation. 19(1) An application for supplementary letters patent shall be in the prescribed form and shall be filed with the Minister together with any information, material and evidence the form specifies and, in the case of an application under

section 17(l)(

b) or (c), evidence that the continued provincial corporation will meet the capital account and capital base requkements referred to in

section 35(b).

(2) On the fiUng of an application for supplementary letters patent, the Minister (

a) may require the applicant to publish notice of the application, containing any information the Minister requkes, in The Alberta Gazette and in a newspaper having general ckculation in the locality where the principal place of business of the provincial corporation is located, and (

b) may requke tiie appUcant to provide any information, material and evidence the Minister considers necessary, in addition to tiie information, material and evidence requked to be provided ki or with the application.

(3) The Lieutenant Govemor in Council shall not issue supplementary letters patent (

a) to continue a provincial loan corporation as a provincial tiust corporation or to continue a provincial tiust corporation as a provincial loan corporation unless he is satisfied tiiat (

i) it is in the public interest to so continue tiie corporation, (ii) the management of tiie appUcant is fit, botii as to character and as to competence, to manage die continued corporation. 26

(iU) die proposed capital stiuctme of the contkiued corporation and die rights, privileges, restiictions and conditions attaching to each class of shares are acceptable to die Minister, (iv) each person who, based on the subscriptions for shares in tiie continued corporation, wUl hold or beneficially own 10% or more of any class of shares of die continued corporation, or voting shares of die continued corporation to which are attached 10% or more of die voting rights attachmg to all of tiie voting shares of tiie continued corporation, or who holds or beneficially owns or on die issue of die supplementary letters patent wiU hold or beneficially own such shares, can demonstiate die adequacy of his financial resomces and is fit as to character to hold or own the shares subscribed for, (

v) each dkector of the appUcant is fit, botii as to character and as to competence, to be a dkector of die contkiued corporation, (vi) the depositors of tiie continued corporation wiU be adequately protected, (vii) the proposed plan of operation of the continued corporation is feasible, and (viU) the continued corporation intends to offer to the public the services set out in the application for supplementary letters patent; (

b) to continue a provincial tmst corporation as a provkicial loan corporation unless he is satisfied that arrangements have been made to tiansfer to another registered tiust corporation the business in relation to which the provincial tmst corporation acted in a fiduciary capacity, and those arrangements are adequate to protect the persons in relation to which the provincial tiust corporation acted in a fiduciary capacity. (4) Subsection (3)(

b) does not apply so as to requke a provincial tmst corporation that has applied to be continued as a provincial loan corporation to ttansfer money received by it as deposits.

(5) Where supplementary letters patent have been issued to continue a provincial loan corporation as a provincial tmst corporation, (

a) deposits received by the provincial loan corporation under

section 189(l)(

a) are deemed to be deposits received under

section 189(2)(a), and 27

(

b) deposits received by the provincial loan corporation under

section 189(l)(

b) are deemed to be deposits received under

section 189(2)(b).

(6) Where supplementary letters patent have been issued to continue a provincial tmst corporation as a provincial loan corporation, (

a) deposits received by die provkicial tmst corporation under

section 189(2)(

a) are deemed to be deposits received under

section 189(l)(a), and (

b) deposits received by the provincial tmst corporation under

section 189(2)(

b) are deemed to be deposits received under

section 189(l)(b). Names 20(1) Subjcct to tiic regulations, neither letters patent nor supplementary letters patent shall be issued to a provincial corporation if the corporation has a name (

a) that is prohibited by the regulations or contains a word or expression that is prohibited by the regulations, (

b) tiiat is identical to the name of (

i) a body corporate, whether in existence or not, incorporated under die laws of Alberta, (ii) an extta-provincial body corporate registered in Alberta, or (iU) a body corporate incorporated by or under

an Act of the ParUament of Canada, (

c) tiiat is similar to the name of (

i) a body corporate incorporated under the laws of Alberta, (ii) an extta-provincial body corporate registered in Alberta, or (iU) a body corporate incorporated by or under

an Act of the ParUament of Canada, if die use of tiiat name is confusing or misleading, (

d) tiiat does not meet the requkements prescribed by die regulations. 28

First directors' meeting Meeting of shareholders (

e) tiiat, in tiie case of a ttust corporation, does not include "ttust" or "fiducie" together with "corporation", "company", "compagnie", "limited", "limit6e" or "societe", or (0 diat, in die case of a loan corporation, does not mclude "loan" or "prets" together with "corporation", "company", "compagnie", "limited", "limitee", or "societ6".

(2) Subject to this Act and die regulations, a provincial corporation may have a name in an EngUsh form, a French form, an English form and a French form or a combined EngUsh and French form, and it may be legally designated by any such name.

(3) Where, through inadvertence or otiierwise, a provkicial corporation obtains a name contiary to tiiis section, tiie Lieutenant Govemor in Council may, on the recommendation of die Minister, issue supplementary letters patent changkig die name of die corporation to a name speckled in die supplementary letters patent. Organization and Commencement 21

(1) After die issue of letters patent incorporatkig a provmcial corporation under this Part, a meeting of die dkectors of the corporation shall be held, and at that meetmg the dkectors may, subject to tilis Part, (

a) make by-laws, (

b) adopt forms of security certkicates and corporate records, (

c) authorize the issue of securities of tiie corporation, (

d) appoint officers, (

e) appoint an auditor to hold office untU the fkst meeting of shareholders, (

f) make banking arrangements, and (

g) deal with any otiier matters necessary to organize the corporation.

(2) An applicant for letters patent to kicorporate the provmcial corporation or a dkector named in the application for letters patent may caU the meetmg of the directors referred to in subsection (1) by giving not less than 5 days' notice to each dkector, statkig the time and place of the meeting. 22(1) When the capital base and die capital accounts of a provincial corporation mcorporated imder tiiis Part reach the 29

Term of first directors Carrying on business No payments before registraUon Deposit or investment before registraUon applicable amounts referred to in

section 35(b), the dkectors shall fortiiwitii call a meeting of the shareholders of the corporation.

(2) The dkectors shall give notice of the meeting referred to m subsection (1) in accordance with

section 85.

(3) The shareholders shaU by ordinary resolution at the meeting referred to m subsection (1) (

a) approve, amend or reject any by-laws made by the directors, (

b) elect dkectors to hold office for a term expkkig not later than tiie close of the fkst annual meeting of shareholders following the election, and (

c) appoint an auditor to hold office untU the close of the fkst annual meeting of shareholders. 23 A dkector named in die appUcation for letters patent to incorporate a provincial corporation holds office until the election of dkectors at the meeting of shareholders referred to in

section 22. 24 Except as permitted in sections 25 and 26, a provincial corporation incorporated under this Part shaU not carry on any business untU it is registered under

Part 4. 25 Until a provincial corporation incorporated under this

Part is registered under

Part 4, no payments on account of incorporation or organization expenses shall be made out of money received from the issue of securities of the corporation, or from the interest on that money, except reasonable sums (

a) for tiie payment of the remuneration of not more than 2 officers, (

b) for the payment of costs related to the issue of secmities of the corporation, (

c) for the payment of clerical assistance, legal services, accounting sei-vices, office accommodation at one location, office expenses, advertiskig, stationery, postage and tiavel expenses, if any, and (

d) for other prescribed purposes. 26 A provincial corporation incorporated under this Part may, before k becomes registered under

Part 4, 30

(

a) deposit paid-up capital of die corporation in an eUgible financial institution, and (

b) invest paid-up capital of die corporation in securities issued or guaranteed by the Govemment of Canada or any province.

PART 4 REGISTRATION DefiniUon 27 In tiiis Part, "application for registtation" means any of the applications referred to in

section 29. Registers 28(1) The register known as the "Trust Companies Register" is hereby continued as the "Trust Corporations Register" for the purposes of this Act.

(2) There is hereby estabUshed a register caUed die "Loan Corporations Register".

(3) The Minister shall maintain the registers and shall cause to be recorded in the appropriate register (

a) the name of each tmst corporation or loan corporation tiiat has been granted registtation, (

b) all terms, conditions and restrictions imposed on the registiation of a tmst corporation or a loan corporation, (

c) tiie suspension or revocation of the registtation of a tmst corporation or loan corporation, and (

d) any other information that is prescribed.

(4) On payment of the prescribed fee any person may, during usual business horns, examine the registers and take extiacts from or obtain copies of them. Applications re 29(1) A Corporation that is duly constituted or incorporated under registration ^^^ j^^^ ^^ Albcrtu or of Canada or of another province may apply for mitial registtation as a tmst corporation or a loan corporation.

(2) A registered loan corporation may apply to change its registtation to that of a tmst corporation and a registered tiust corporation may apply to change its registtation to that of a loan corporation.

(3) A registered corporation may apply to amend the terms, conditions and restiictions of its registiation. 31

Particulars of 30(1) An application for registtation shall be ki tiie prescribed application ^^^ ^^ ^^^^ ^^ ^^^^ ^.^ ^^ Minister togetiier witii any other information, material and evidence the form specifies.

(2) Where the Minister receives an application for registtation, he may requke the applicant to provide any kiformation, material and evidence he considers necessary, in addition to the information, material and evidence requked to be provided in or with the application.

(3) Where the activities of the corporation wUl mvolve the deposit-taking business, the appUcation for registtation shall be accompanied by evidence that the corporation wiU from the time of registration be a member of the Canada Deposit Insmance Corporation or that the corporation's deposits wiU be insured by some other similar public agency approved by the Minister.

(4) An appUcation for registtation as a tmst corporation shall set out the classes of service in relation to which the corporation proposes to act in a fiduciary capacity.

(5) An application by a provincial corporation incorporated under

Part 3 shall set out the sums of money paid or to be paid by the corporation in connection with its kicorporation and organization. Consents and undertakings 31

(1) Where an extia-provincial loan or tmst corporation appUes for registtation, the application shaU be accompanied by (

a) a consent in writing authorizing the Minister to conduct examinations under sections 272 and 273 at tiie head office of the corporation or any of its subsidiaries, wherever located, and at branches of the corporation, wherever located, and (

b) a written undertaking signed by the proper officers of the corporation that the corporation and its subsidiaries wiU provide to the Minister any information that he requkes in the administiation of this Act and that the corporation wUl comply witii tiie applicable provisions of tiiis Act and with any terms, conditions and restrictions imposed on its registiation.

(2) An undertaking under subsection (1) shall be accompanied by a certified copy of the resolution of die board of dkectors audiorizuig tiie extta-provincial loan or ttust corporation's officers to apply for registiation under diis Act and authorizkig the execution of the undertaking.

(3) Where a provincial corporation applies for registtation, tiie application shall be accompanied by 32

Power of attomey Publication Names (

a) a consent in writing authorizkig the Minister to conduct examinations under sections 272 and 273 at the head office of any of its subsidiaries, wherever located, and (

b) a written undertaking that tiie subsidiaries of the corporation wiU provide to the Miiuster any information that he requkes in the administtation of this Act. 32(1) Where an extta-provincial loan or ttust corporation applies for registtation, the application shaU be accompanied by (

a) a power of attomey from the corporation, in the prescribed form, naming an agent or agents resident in Alberta for the purposes of

section 321(2), and (

b) the consent of the agent to act in the prescribed form.

(2) A power of attomey under this

section (

a) shall be signed by the proper officers of the corporation in the presence of a wimess, and (

b) shall be accompanied by the statutory declaration of the wimess referred to m clause (

a) in die prescribed form.

(3) When an extta-provincial loan or ttust corporation changes any of its agents in Alberta, k shall forthwith file witii tiie Minister a new power of attomey complying with subsection (2).

(4) An extta-provincial loan or tiust corporation shall send to the Minister a notice in the prescribed form of any change m the address of ks agents withm 15 days after die change occms.

(5) A copy of a power of attomey under tiiis

section certified by the Mmister is sufficient evidence for all purposes of die power and autiiority of tiie person or persons named in it to act on behak of the extia-provincial loan or tiust corporation. 33 Where the Minister receives an appUcation for registtation, he may requke die appUcant to pubUsh notice of the appUcation, containkig any information die Mmister requkes, in The Alberta Gazette and in a newspaper having general ckculation in any locaUty the Minister directs. 34(1) Subject to die regulations, no corporation shall be registered widi a name diat does not meet die requkements of

section 20(1).

(2) Subject to tilis Act and die regulations, a corporation may be registered diat has a name in an EngUsh form, a French form, an English fonn and a French form or a combined English and French 33

form, and it may be legally designated in Alberto by any such name.

(3) Where a corporation has a name that conttavenes subsection (1), die Minister may register the corporation if k undertakes eidier to change its name to a name that does not contiavene subsection (1) or to carry on business in Alberto under a name that does not contiavene subsection (1).

(4) Where, through inadvertence or otiierwise, a corporation becomes registered with a name that contiavenes subsection (1), the Minister may order as a condition of registiation that the corporation carry on business under a name specified in die order. Rejection of 35 Subjcct to scction 36, the Minister shaU reject an application application f^j. registration, (

a) unless he is satisfied that, in the case of an applicant tiiat is a provincial corporation incorporated under

Part 3, (

i) the meeting of shareholders referred to in

section 22 has been held, and (ii) the expenses of incorporation or organization that have been paid or are to be paid by the corporation are reasonable, (

b) unless (

i) the amount of the corporation's stoted capital account for issued common shares or tiie amount of any otiier prescribed capital account of the corporation, or a combination of those amounts, is at least the greater of (A) $3 000 000 in the case of a loan corporation and $5 000 000 in the case of a tmst corporation, and (

B) any greater amount requked by the Minister, and (ii) the corporation has a capital base that is adequate, taking into account tiie natme of tiie business that it proposes to engage in, the expected volume of its busmess and any restiictions on its busmess, and tiiat is at least $3 000 000 in the case of a loan corporation and $5 000 000 in the case of a ttust corporation, (

c) unless tiie corporation satisfies tiie Minister tiiat k has tiie capacity and power to engage in the activities of a tiust corporation or a loan corporation, as the case may be, 34

(

d) if die applicant is not a corporation referred to ki

section 29(1). (

e) unless it is shown to die satisfaction of the Minister that (

i) k is in the public interest to register an additional tiust corporation or loan corporation, (ii) the management is fit, both as to character and as to competence, to manage the corporation, (iU) die capital stiuctme and the rights, privUeges, restiictions and conditions attoching to each class of shares are acceptoble to the Minister, (iv) each person who, immediately after the registiation, will hold or beneficiaUy own (A) 10% or more of any class of the issued and outstonding shares of die corporation, or (

B) voting shares of the corporation to which are attoched 10% or more of the voting rights attoching to aU of the issued and outstonding voting shares of the corporation can demonstrate the adequacy of his financial resomces and is fit as to character to hold or own tiiose shares, (

v) each director is fit, both as to character and as to competence, to be a dkector of the corporation, (vi) the depositors of die corporation wUl be adequately protected, (vii) the proposed plan of operation of the corporation is feasible, and (viU) die corporation intends to offer to die public the services set out in the application for registiation and the applicant has die capabUity to provide those services, or (

f) k the Minister is not satisfied as to die adequacy of any information received with or in support of die application for registtation. 35

Registration subject to conditions Certificate of registration Time limit for registration 36(1) Where the Mmister is not satisfied as to any or all of the matters referred to ki

section 35(b), (c), (d), (

e) or (

f) or where for any odier reason he considers k appropriate to do so, he may, instead of rejecting tiie application, approve the registtation of the applicant (

a) as a corporation of a kind other than that for which the application for registration was made and subject to any terms, conditions and resttictions he considers appropriate, or (

b) as the kind of corporation for which the application for registtation was made but subject to any terms, conditions and restrictions he considers appropriate.

(2) The Mmister may at the request or with the consent of a registered corporation (

a) impose terms, conditions and restrictions on the registtation of the corporation ki addition to those imposed under subsection (1). or (

b) revoke the corporation's registration, subject to any terms, conditions and restrictions that the Minister considers appropriate. 37(1) Where the Minister registers a corporation he shall issue a certkicate of registtation in the prescribed form and the certificate of registtation is conclusive proof for the purposes of this Act and for all other purposes that the provisions of this Act in respect of registtation of the corporation and all requkements precedent and incidentol to registration have been compUed with, and that the corporation has been registered under this Part as of the date shown in the certificate of registtation.

(2) The Minister shaU publish in The Alberta Gazette notice of die registtation of a corporation. 38 Where a provmcial corporation tiiat is incorporated under

Part 3 does not become registered within one year ^ter tiie date of its letters patent, or withm any further period that the Mmister may on appUcation aUow, (

a) die dkectors shaU ensme that the corporation fortiiwitii takes all reasonable steps under

Part 14 toward its dissolution, and (

b) the corporation shall not carry on any business or activity except for die sole purpose of dissolving the corporation. 36

PART 5 PRINCIPAL PLACE OF BUSINESS, RECORDS AND RETURNS Principal place 39(1) ^ provkicial Corporation shaU at aU times have a principal r^TSo" P^^ Of ""siness in Alberta.

(2) A notice of (

a) the principal place of business, and (

b) a separate records office, if any, shaU be sent to the Minister with tiie appUcation for registiation under

section 29.

(3) The dkectors of a provincial corporation may at any time (

a) change the address of the principal place of business, or (

b) designate or revoke a designation of a records office in Alberta.

(4) Unless the dkectors designate a separate records office, the principal place of business of a provincial corporation is its records office.

(5) A provincial corporation shall send to the Minister a notice of any change under subsection (3) in the prescribed form within 15 days of that change.

(6) A provincial corporation shall ensme that its principal place of business and its records office are (

a) accessible to the public during normal busmess horns, and (

b) readUy identifiable from the address or other description given in a notice under subsection (2) or (5). RecOTd keeping 40(1) A provkicial Corporation shaU keep at its records office (

a) a copy of its insttument of incorporation and ks by-laws, (

b) minutes of meetings and resolutions of shareholders, (

c) a register of dkectors setting out, with respect to each person who is or has been a dkector. 37

(

i) his name, (ii) the dates on which he became and ceased to be a dkector, and (iU) his full residential address while a dkector, (

d) a securities register complying with

Part 6 of the Business Corporations Act as incorporated by

section 53 of tiiis Act, (

e) a copy of tiie procedmes referred to in

section 197, and (

f) copies of the financial stotements, documents and information referred to in

section 156(1).

(2) Notwithstonding subsection (1), a centtal securities register may be maintoined at an office in Alberta of a provincial corporation's agent referred to in

section 46(2)(

a) of the Business Corporations Act, as incorporated by

section 53 of this Act, and a branch securities register may be kept at any place in or out of Alberto designated by the dkectors.

(3) If a cential secmities register is maintoined under subsection (2) at a place other than the records office, the provincial corporation shall maintain at its records office a record contoining the names and addresses of all agents and offices at which securities registers are maintoined and descriptions of all those registers.

(4) A registered extra-provincial loan corporation and a registered extta-provincial tmst corporation shall maintain at a place in Alberto designated by the dkectors a copy of its insttument of incorporation and its by-laws, and a copy of minutes and registers referred to ki subsection (l)(b), (

c) and (d). Additional 41(1) In addition to the records described ki

section 40, a recor s registered corporation shall maintain in Alberto or at another place in Canada consented to by the Minister (

a) adequate accountmg records diat wUl enable die Minister to determine the financial position of the corporation and whetiier it is in compliance witii this Act and die regulations, (

b) records containkig minutes of meetings and resolutions of the dkectors and every committee of dkectors, (

c) a record of aU kivestments held by the corporation, (

d) copies of all retums to the Minister requked by this Act or the regulations, and 38

Access to corporate records Right to list of shareholders (

e) in tiie case of a tmst corporation, full and adequate records relating to the fiduciary activities of the corporation.

(2) A registered corporation may keep at any place where it carries on business the parts of the accounting records that relate to the operations, business and assets and UabiUties of the corporation carried on, supervised or accounted for at tiiat place, but the corporation shaU ensme tiiat there is kept at the records office of the corporation or at another place authorized under this Part records that are adequate to enable the dkectors to ascertoin the financial position of the corporation. 42(1) The directors and shareholders of a provincial corporation and their agents and legal representotives may examine the records referred to in

section 40(1) during the usual busmess horns of the corporation free of charge.

(2) A shareholder of a provincial corporation is entitled on request and without charge to one copy of tiie insttument of incorporation and by-laws and amendments to them.

(3) Creditors of a provincial corporation and thek agents and legal representotives may examine the records referred to in

section 40(l)(a), (

c) and (

d) during the usual business hours of the corporation on payment of a reasonable fee and may make copies of those records.

(4) Any person may examine the records referred to in

section 40(1 )(

c) and (

d) during die usual busmess horns of tiie provincial corporation on payment of a reasonable fee and may make copies of those records. 43(1) In the case of a provincial corporation that is a reporting issuer, on payment of a reasonable fee and on sending to the corporation or its agent die stotutory declaration refered to ki subsection (5), any person may on appUcation requke the corporation or its agent to fumish within 10 days from die receipt of the stotutory declaration a list (in this

section referred to as the "basic list") made up to a date not more tiian 10 days before the date of receipt of the stotutory declaration, setting out (

a) die names of die shareholders of die corporation, (

b) die number of shares owned by each shareholder, and (

c) tiie address of each shareholder, as shown on the records of die corporation. 39

(2) A person requking a provmcial corporation to supply a basic list may, k he stotes m the stotutory declaration diat he requkes supplementol lists, requke the corporation or its agent on payment of a reasonable fee to fumish supplemental Usts setting out any changes from the basic list in die information provided m k for each business day foUowing the date the basic Ust is made up to.

(3) The provincial corporation or its agent shall fumish a supplementol list required under subsection (2) (

a) on the date the basic list is fiunished, k the information relates to changes diat took place before that date, and (

b) on die busmess day following the day to which the supplementol list relates, if the information relates to changes that took place on or after the date the basic list was fumished.

(4) A person requiring a provincial corporation to supply a basic list or a supplementol list may also requke the corporation to include in that Ust the name and address of any known holder of an option or right to acquke shares in the corporation.

(5) A stotutory declaration shall stole (

a) the name and address of the appUcant, (

b) the name and address for service of the body corporate k the applicant is a body corporate, and (

c) tiiat the basic Ust and any supplemental lists obtained pmsuant to subsection (2) wUl not be used except as permitted under

section 44.

(6) If the appUcant is a body corporate, the stotutory declaration shaU be made by a dkector or officer of the body corporate. Use of list 44 No person shall use a Ust of shareholders obtained under this

section except in connection with (

a) an effort to influence the voting of shareholders of die provmcial corporation, (

b) an offer to acquire shares of the provincial corporation, or (

c) any other matter relatkig to the affaks of die provincial corporation. Trafficking in 45 ^Q pcrsou shall scU or purchase, offer for sale or purchase or otherwise ttaffic in a list of holders of securities of a provincial corporation. 40

Annual retum 46(1) A registered corporation shall prepare annually and send to the Minister not later dian 3 months after die end of each fiscal year an annual retum m die prescribed form relating to tiie fiscal year.

(2) In the case of a provincial corporation, the annual retum shall be accompanied by (

a) the fmancial stotements and report of the auditor for the fiscal year to which the retum relates, prepared in accordance widi sections 156(2) and 157, (

b) a copy of the resolution of the directors approving the annual retum, and (

c) any otiier documents and information prescribed by the Minister.

(3) In the case of an extia-provkicial corporation, tiie annual retum shall be accompanied by tiie financial stotements and auditor's report on them for the fiscal year to which the retum relates that the corporation must provide or has provided to a Minister of the Crown or a govemment official or agency ki accordance with the requkements of appUcable ttust or loan corporation legislation goveming the corporation in its home jurisdiction.

(4) Where, (

a) in the case of a provincial corporation, die financial stotements referred to in subsection (2) would be requked by

section 157 to be on a consoUdated basis, or (

b) m the case of an extra-provincial corporation, tiie financial stotements referred to in subsection (3) are on a consolidated basis or would be requked by

section 157 to be on a consolidated basis if the extia-provincial corporation were a provincial corporation, the financial stotements shall be accompanied by (

c) separate audited financial stotements in respect of die provincial corporation or extta-provincial corporation, as the case may be, where it is a holdmg body corporate, and (

d) separate audited financial stotements ki respect of die provincial corporation or extta-provincial corporation, as tiie case may be, where the provincial corporation or extia- provkicial corporation is a subsidiary. 41

(5) Where die provincial corporation or extia-provmcial corporation is a subsidiary, die Mmister may by notice in writing requke the holdmg body corporate of the provincial corporation or extta-provincial corporation to forward to him its financial stotements and auditor's report, and may in the notice dkect the basis on which those financial stotements are to be prepared and the period of time to which they are to relate.

(6) Where the provincial corporation or extta-provincial corporation is a holding body corporate, the Minister may by notice in writing requke the provincial corporation or extta-provincial corporation to forward to him separate audited financial stotements in respect of any of its subsidiaries, and may in the notice dkect the basis on which those financial stotements are to be prepared and the period of time to which they are to relate.

Other 47(1) A registered corporation shaU send to the Minister a copy ^° Wen to ^° °^ every stotement of a financial nature relating to the corporation Minister that is fumishcd to its shareholders witiiin 5 days after the fumishing of the stotement to the shareholders.

(2) A registered corporation shaU send to tiie Minister (

a) a copy of any application and supportkig documents made under a law of Canada or of a province otiier than Alberto for a change to its insttument of incorporation or ks registtation stotos, together with a copy of the approval or refusal of the application, within 7 days of the making of the appUcation or the receipt of the approval or refusal, and (

b) a copy of any change made to its instmment of incorporation or to its abUity to carry on business in any otiier jurisdiction ki Canada, widiin 7 days after die effective date of the change.

(3) A registered extta-provincial corporation shall send to the Minister notice (

a) of the making of an order by a court or person in anotiier jurisdiction that is in die natme of an order or dkection under

section 273, 278, 282, 283 or 284 of this Act, and (

b) of the corporation's being subject to an arrangement in anotiier jurisdiction tiiat is ki the natme of a program of voluntary compUance under

section 279 of this Act.

(4) A registered extta-provincial corporation shaU send to the Minister notice of any change in the membership of its board of directors widiin 30 days after tiie effective date of die change. 42

(5) A registered corporation shall provide to the Minister at the tunes prescribed by the Minister any financial or otiier information tiiat is prescribed by tiie Minister. Form of records 48 AU rcgistcrs and otiier records requked by tiiis Act to be prepared and maintoined by a registered corporation may be in bound or loose-leaf form or in photographic fihn form, or may be entered or recorded by any system of mechanical or electionic dato processing or any other information storage device tiiat is capable of reproducing any requked information in legible written form widiin a reasonable time.

Legible copies 49(1) If a pcrsou is entitied to examine any register or record tiiat is maintained by a registered corporation in a form other than written form and makes a request of the corporation to do so, the corporation shaU (

a) make available to that person within a reasonable tkne a reproduction of the text of the register or record in legible written form, or (

b) provide faciUties to enable that person to examine the text of the register or record in legible written form otiierwise tiian by providing a reproduction of that text, and shaU allow that person to make copies of tiiat register or record.

(2) A registered corporation may charge a reasonable fee for providing a reproduction of die text of a register or record under subsection (1). 50 A registered corporation and its agents shaU take reasonable precautions to (

a) prevent loss or destiuction of, (

b) prevent falsification of entties m, and (

c) facilitote detection and correction of kiaccuracies ki, the registers and other records required by tiiis Act to be prepared and maintoined.

PART 6 SHARES AND SHAREHOLDERS Definition 51 In tius Part, "security" means, subject to

Part 6 of tiie Business Corporations Act as incorporated by

section 53 of tiiis Protection of records 43

Interpretation Application of Business Corporations Act N(xi-par value shares Classes of shares Act, a share of any class or series of shares or a debt obligation of a body corporate, and mcludes a certkicate evidencing such a share or debt obligation and includes a warrant, but does not include a deposit or any mstiiiment evidencing a deposit in a corporation. 52 For tiie purposes of sections 63, 64, 65, 67 and 72, deposits in a provmcial tiust corporation shall be deemed to be a UabiUty of die corporation notwitiistanding tiiat tiie deposits are held by it as tiustee. 53

Part 6 of tiie Business Corporations Act applies witii respect to a provincial corporation as if k were a corporation witiiin die meaning of that Act, and a reference in that Part to a

section m that Act, otiier tiian to a

section in tiiat Part, is deemed to be a reference to the corresponding

section in diis Act that deals witfi the same subject matter. 54(1) Shares of a provincial corporation shaU be in registered form and shall be widiout nominal or par value.

(2) Shares witii a nominal or par value of a provmcial corporation incorporated before die coming into force of this

section are, for tiie purposes of subsection (1), deemed to be shares witiiout nominal or par value. 55(1) A provincial corporation shall have a class of shares designated as "common shares".

(2) The rights of die holders of common shares are equal in all respects and mclude (

a) die right to vote at aU meetings of shareholders, (

b) the right to receive dividends of the provincial corporation if declared on those shares, and (

c) tiie right to receive the remaining property of the provincial corporation on dissolution.

(3) The instmment of incorporation may provide for classes of shares in addition to common shares, and in diat case (

a) die rights, privileges, restiictions and conditions attoching to the shares of each class shaU be set out in the instiument of incorporation, and (

b) those shares shaU not be designated as common shares or by any similar term. 44

Issue of shares Stated capital account

(4) Subject to

section 58, if a provincial corporation has more tiian one class of shares, tiie rights of the holders of the shares of a class are equal in all respects. 56(1) Subject to tiiis Act and die uistiTunent of incorporation, shares of a provincial corporation may be issued at the times, to the persons and for the consideration determined by die dkectors.

(2) Shares issued by a provincial corporation are non-assessable and die shareholders are not liable to the corporation or to its creditors in respect of them.

(3) A provkicial corporation shall not issue a share untU the consideration for die share is fully paid in money and received by the corporation.

(4) The requkement in subsection (3) tiiat die consideration be ki money does not apply (

a) in a case where the share is issued as part of an amalgamation, or (

b) in any other ckcumstonces with respect to which the Minister has given his prior approval. 57(1) A provincial corporation shaU maintom a separate stoted capitol account for each class and series of shares it issues.

(2) Unless the Minister approves otherwise, a provincial corporation shaU add to the appropriate stoted capital account in respect of any shares k issues tiie fuU amount of the consideration it receives for tiie shares.

(3) On the issue of a share, a provincial corporation shall not add to a stoted capital account ki respect of the share an amount greater than the amount referred to in subsection (2).

(4) If a provincial corporation proposes to add any amount to a stoted capital account it maintoins in respect of a class or series of shares and (

a) tiie amount to be added was not received by die corporation as consideration for the issue of shares, and (

b) die corporation has issued outstonding shares of more tiian one class or series, tiie addition to tiie stoted capitol account must be approved by special resolution unless all the issued and outstandmg shares are 45

shares of not more than 2 classes of convertible shares referred to in

section 68(5).

(5) Where, in die case of a proposed addition of an amount to a stoted capital account in a simation where a special resolution is requked under subsection (4), a class or series of shares of a provincial corporation would be affected differently from how any other class or series of shares of die corporation would be affected by such action, the holders of shares of the differently affected class or series are entitied to vote separately as a class or series, as the case may be, on the proposal to take the action, whether or not such shares otiierwise carry the right to vote.

(6) Subject to subsections (4) and (5), a provincial corporation may add to a stoted capitol account any amount it has credited to a retained eamings or other surplus account.

(7) On die day this

section comes into force, the stoted capital of each class and series of shares of a provincial tmst corporation is deemed to equal tiie paid-up capitol of each class and series of shares of the body corporate immediately prior to that day. Shares in series 58(1) Subjcct to its insttumcnt of kicorporatiou, the dkectors of a provincial corporation may authorize tiie issue of any class of shares, other than common shares, in one or more series and they may fix the number of shares in, and determme the designation, rights, privUeges, resttictions and conditions attoching to the shares of each series.

(2) If any cumulative dividends or amounts payable on retum of capitol in respect of a series of shares are not paid in full, the shares of aU series of the same class participate ratobly in respect of accumulated dividends and retum of capital.

(3) No rights, privileges, restiictions or conditions attoched to a series of shares authorized under this

section shall confer on shares of a series (

a) greater voting rights tiian are attoched to shares of any other series in the same class that are then outstanding, or (

b) a priority in respect of dividends or retum of capital over shares of any other series ki tiie same class tiiat are tiien outstonding. (4) Subsection (3) does not apply to a right or privUege to exchange a share or shares for, or to convert a share or shares into, a share or shares of another class. 46

Shareholder's pre-emptive right 59(1) If the letters patent of a provincial corporation so provide, no shares of a class shall be issued unless the shares have fkst been offered to the shareholders holding shares of that class, and those shareholders have a pre-emptive right to acquire the offered shares m proportion to tiiek holdings of the shares of that class, at the same price and on tiie same terms as those shares are to be offered to otiiers. Conversion privileges, options and rights Prohibited shareholdings

(2) Notwithstonding that the letters patent provide the pre-emptive right referred to in subsection (1), shareholders have no pre emptive right in respect of shares to be issued (

a) for a consideration other than money, (

b) as a share dividend, or (

c) pursuant to the exercise of conversion privUeges, options or rights previously granted by the provincial corporation. 60(1) A provincial corporation may issue certkicates, warrants or other evidences of conversion privileges or options or rights to acquke securities of the corporation, and shall set out the conditions to which the conversion privileges, options or rights are subject (

a) in the certificates, warrants or other evidences, or (

b) in certificates evidencing the securities to which the conversion privileges, options or rights are attoched.

(2) Conversion privUeges and options or rights to pmchase securities of a provincial corporation may be made tiansferable or non-ttansferable, and options and rights to pmchase may be made separable or inseparable from any securities to which they are attoched.

(3) If a provincial corporation has granted privileges to convert any securities issued by the corporation into shares, or into shares of another class or series, or has issued or granted options or rights to acquke shares, the corporation shall reserve and continue to reserve sufficient autiiorized shares to meet the exercise of those conversion privileges, options and rights. 61(1) A provincial corporation (

a) shall not hold shares in itself or in its holding body corporate, and (

b) shall not permit any of its subsidiaries to hold shares in the corporation or in the holding body corporate of the corporation 47

Restrictions on acquisition of shares Acquisition of own shares except ki accordance with this

section and sections 62 to 66 or unless the Minister consents in writing to the holding. (2) Subsection (1) does not apply to shares held ki conttavention of subsection (1) immediately before December 8, 1988.

(3) A provincial corporation may in tiie capacity of personal representotive hold shares in itself or ki its holding body corporate unless k or die holding body corporate or a subsidiary of either of them has a beneficial interest in the shares.

(4) A provincial corporation may hold shares in itself or in its holding body corporate by way of security for the purposes of a ttansaction entered into by it in the ordinary comse of its business.

(5) A provincial corporation holdmg shares in itself or in its holding body corporate shall not vote or permit those shares to be voted unless the corporation (

a) holds die shares in the capacity of personal representotive, and (

b) has compUed with

section 147 of the Business Corporations Act, as incorporated into this Act by

section 99 of this Act. 62(1) Subject to this section,

section 77 appUes to a pmchase, acquisition or redemption for canceUation of voting shares by a provincial corporation under

section 63, 64 or 65 as k the pmchase, acquisition or redemption of voting shares were a tiansfer or issue of voting shares.

(2) Notwithstonding subsection (1), (a)

section 77(6) does not apply, and (

b) the provincial corporation must make the application referred to in

section 77(7) on behalf of the persons referred to in that subsection in the case of a pmchase, acquisition or redemption of shares referred to m subsection (1). 63(1) Subject to subsection (2) and to its by-laws, a provincial corporation may purchase or otherwise acquke shares issued by U.

(2) A provmcial corporation shall not make any payment to pmchase or otiierwise acquke shares issued by k if there are reasonable grounds for beUeving that 48

(

a) the corporation is, or after the payment would be, unable to pay its UabiUties as they become due, or (

b) the realizable value of the corporation's assets after the payment would be less than the aggregate of its UabiUties and stoted capitol of aU classes.

(3) A provincial corporation that is not a reporting issuer shaU, witiiin 30 days of the pmchase of any of its issued shares, notky its shareholders (

a) of the number of shares it has pmchased, (

b) of die names of die shareholders from whom it has pmchased the shares, (

c) of the price paid for tiie shares, and (

d) of the balance, k any, remaining due to tiie shareholders from whom it pmchased the shares.

(4) A shareholder of a provmcial corporation other than a reporting issuer is entitled on request and widiout charge to a copy of the agreement between tiie corporation and any of ks other shareholders under which the corporation has agreed to pmchase, or has purchased, any of its own shares. Alternative 64(1) Subjcct to subscctiou (2) and to its by-laws, a provincial ^si^«°^ corporation may purchase or otiierwise acquke shares issued by it (

a) to settie or compromise a debt or claim asserted by or against the corporation, (

b) to eliminate fractional shares, or (

c) to fulfil the terms of a non-assignable agreement under which the corporation has an option or is obliged to pmchase shares owned by a director, officer or employee of the corporation.

(2) Notwithstonding

section 63(2), a corporation may pmchase or otherwise acquire shares issued by it to comply with an order under

section 292.

(3) A provincial corporation shall not make any payment to purchase or acquke under subsection (1) shares issued by it if there are reasonable grounds for believing that (

a) die corporation is, or after the payment would be, unable to pay its UabiUties as they become due, 49

(

b) tiie reaUzable value of the corporation's assets after the payment would be less dian the aggregate of (

i) its liabUities, and (ii) the amount that would be required to pay the holders of shares who have a right to be paid, on a redemption or in a liquidation, prior to the holders of the shares to be pmchased or acquked. or Redonption of shares (

c) the purchase or acquisition would cause the corporation to be in contiavention of tiiis Act or the regulations. 65(1) Subject to subsection (2) and to its by-laws, a provincial corporation may purchase or redeem any redeemable shares issued by it at prices not exceeding the redemption price calculated according to a formula stoted in the by-laws.

(2) A provincial corporation shall not make any payment to pmchase or redeem any redeemable shares issued by it if there are reasonable grounds for beUeving that (

a) the corporation is, or after the payment would be, unable to pay its UabiUties as tiiey become due, (

b) tiie reaUzable value of the corporation's assets after tiie payment would be less than the aggregate of (

i) ks liabilities, and (ii) the amount that would be requked to pay the holders of shares who have a right to be paid, on a redemption or in a liquidation, ratobly with or prior to the holders of the shares to be pmchased or redeemed, or Donated and escrowed shares (

c) tiie redemption woidd cause the corporation to be in contiavention of this Act or tiie regulations. 66 A provincial corporation may accept from any shareholder a share of tiie corporation (

a) that is surrendered to it as a gift, or (

b) that has been held in escrow pmsuant to an escrow agreement required by the Chief of Securities Administtation and that is surrendered pmsuant to that agreement. 50

ft2'ii°''i2 67(1) Subject to subsection (3) and its insttument of capi incorporation, a provincial corporation, by special resolution and witii the approval of tiie Minister, may reduce its stoted capital for any purpose.

(2) Where a class or series of shares of a provincial corporation would be affected by a reduction of stoted capitol under subsection (1) differentiy from how any other class or series of shares of the corporation would be affected by such action, the holders of shares of the differentiy affected class or series are entitied to vote separately as a class or series, as die case may be, on die proposal to take the action, whetiier or not the shares otherwise carry the right to vote.

(3) A special resolution under tiiis

section shall specify tiie stoted capitol account or accounts from which die reduction of stoted capitol affected by the special resolution wUl be made.

(4) A provincial corporation shall not reduce its stoted capital, other than for the purpose of declaring it to be reduced by an amount that is not represented by reaUzable assets, if there are reasonable grounds for beUeving that (

a) die corporation is, or after the reduction would be, unable to pay its liabUities as they become due, (

b) the reaUzable value of the corporation's assets after the reduction would be less than the aggregate of its liabUities, or (

c) die reduction would cause the corporation to be in contiavention of this Act or the regulations.

(5) A shareholder, creditor or depositor of a provincial corporation may apply to the Court for an order compeUing another shareholder or another recipient (

a) to pay to tiie corporation an amount equal to any UabiUty of that otiier shareholder that was extinguished or reduced contiary to this section, or (

b) to pay or deliver to the corporation any money or property that was paid or distiibuted to that other shareholder or recipient as a consequence of a reduction of capital made conttary to this section.

(6) A proceeding to enforce a liabUity unposed by this

section may not be commenced after 2 years from die date of the action complained of. 51

Adjustment of stated coital account

(7) This

section does not affect any liabUity that arises under

section 131. 68(1) On a pmchase, redemption or other acquisition by a provkicial corporation under

section 63,64,65,73 or 292(3)(

e) of shares or fractions of shares issued by it, the corporation shall deduct from the stoted capital account maintained for the class or series of shares of which the shares pmchased, redeemed or otherwise acquked form a part, an amount equal to the result obtained by multiplying the stoted capital of the shares of diat class or series by the number of shares or fractions of shares of tiiat class or series pmchased, redeemed or otherwise acquked, divided by die number of issued shares of that class or series immediately before the pmchase, redemption or other acquisition.

(2) A provincial corporation shall deduct the amount of a payment made by the corporation to a shareholder under

section 292(3)(

f) from the stoted capital account maintoined for the class or series of shares in respect of which the payment was made.

(3) A provincial corporation shall adjust its stoted capital account or accounts in accordance with any special resolution referred to in

section 67(3).

(4) On a conversion or change of issued shares of a provincial corporation into shares of anotiier class or series, the corporation ShaU (

a) deduct from tiie stoted capital account maintamed for the class or series of shares converted or changed an amount equal to the result obtained by multiplying the stoted capital of the shares of that class or series by the number of shares of tiiat class or series converted or changed, and dividing by the number of issued shares of that class or series immediately before the conversion or change, and (

b) add the result obtained under clause (

a) and any additional consideration received pursuant to the conversion or change to the stoted capitol account maintained or to be maintained for the class or series of shares into which the shares have been converted or changed.

(5) For the purposes of subsection (4), where a provincial corporation issues 2 classes or series of shares and there is attoched to each class or series a right to convert a share of one class or series mto a share of die otiier class or series, die amount of stoted capitol atttibutoble to a share in either class or series is the amount obtoined when die sum of the stoted capital of bodi classes or series of shares is divided by the number of issued shares of both classes or series of shares immediately before the conversion. 52

Repayment, acquisition and reissue of debt obligati(xis

(6) Shares or fractions of shares issued by a provincial corporation and purchased, redeemed or otiierwise acquked by k shall be cancelled or restored to die stoms of authorized but unissued shares.

(7) For the purposes of this section, a provincial corporation holding shares in itself as permitted by

section 61(3) and (4) is deemed not to have purchased, redeemed or otherwise acquked those shares.

(8) Where shares of a class or series are converted or changed into the same or another number of shares of anotiier class or series, those shares become the same in aU respects as the shares of the class or series into which they are converted or changed. 69(1) Debt obligations issued, pledged, hypothecated or deposited by a provincial corporation are not redeemed by reason only tiiat the indebtedness evidenced by the debt obligations or in respect of which the debt obUgations are issued, pledged, hypothecated or deposited is repaid, and those obligations remain obligations of the corporation untU they are discharged.

(2) Debt obUgations issued by a provincial corporation and pmchased, redeemed or otherwise acquked by it may be canceUed or, subject to any appUcable tmst indentme or other agreement, may be reissued, pledged or hypothecated to secure any obligation of die corporation then existing or thereafter incurred, and any such acquisition and reissue, pledge or hypothecation is not a cancellation of the debt obUgations. Enforceability 70(1) A coutiact with a provincial corporation providing for the "ISse^hSes Pu^chase by k of its own shares is specifically enforceable against pure e s es ^^^ corporation, except to tiie extent tiiat it cannot perform the conttact without contravening

section 63 or 64.

(2) In any action brought on a conttact referred to in subsection (1), die provkicial corporation has the bmden of proving tiiat performance of the conttact is prevented by

section 63 or 64.

(3) Until the provkicial corporation has fully performed a conttact referred to in subsection (1), die otiier party to tiie conttact retains the stotus of a claknant and is entitied (

a) to be paid as soon as the corporation is lawfuUy able to perform the conttact, or (

b) ki a Uquidation, to be ranked subordmate to the rights of depositors, creditors, holders of subordinated notes and any class of shareholders whose rights were in priority to die rights given to die class of shares he contiacted to sell to the 53

Payment of dividend corporation, but in priority to tiie rights of the other shareholders. ^°^*S°" °" ^^ ^® directors of a provincial corporation may autiiorize the ares corporation to pay a reasonable commission to any person in consideration of the person's (

a) pmchasing or agreeing to purchase shares of the corporation from it or from any other person, or (

b) procuring or agreeing to procme purchasers for any such shares. 72(1) The dkectors of a provincial corporation may declare, and a provincial corporation may pay, a dividend by issuing fully paid shares of tiie corporation and, subject to subsection (3), a corporation may pay a dividend in money or property.

(2) If a provincial corporation issues shares of the corporation in payment of a dividend, it shaU add to the stoted capital account for the shares of the class or series issued tiie declared amount of the dividend, stoted as an amount of money.

(3) The directors shall not declare and a provincial corporation shaU not pay a dividend k there are reasonable grounds for beUeving that (

a) the corporation is, or after the payment would be, unable to pay its UabiUties as they become due, (

b) the realizable value of the corporation's assets after the payment would be less than tiie aggregate of (

i) its liabilities, and (ii) its Stoted capital of all classes. or Lien on share (

c) the payment would cause die corporation to be in contiavention of this Act or the regulations. 73(1) The by-laws of a provincial corporation may provide tiiat the corporation has a lien on a share registered m die name of a shareholder or his personal representotive for a debt of tiiat shareholder to the corporation.

(2) A provincial corporation may enforce a lien referted to in subsection (1) ki accordance with its by-laws. 54

Limited liability of shareholders Restrictions on issue, transfer

Interpretation 74 Except as otherwise provided in this Act, the shareholders of a provincial corporation are not, as shareholders, Uable for any liabUity, act or default of the corporation. 75 A provincial corporation shall not impose resttictions on the issue, tiansfer or ownership of shares of any class or series except to the extent that it is authorized to do so by its instiument of incorporation or this Act. 76(1) For the purposes of this

section and sections 77 to 81, a person shall be deemed to be related to (

a) every body corporate the person contiols and every affUiate of such a body corporate, (

b) every parmer of the person, (

c) every tiust or estote in which the person has a substantial beneficiati interest or in respect of which the person serves as tmstee or in a similar capacky, (

d) the spouse of the person, (

e) every relative of the person, or of his spouse, who has the same home as the person, and (

f) every other person tiie Minister considers is acting in concert wkh the person to acquire and contiol voting shares of a provincial corporation and so designates by order as a related person.

(2) For the purpose of sections 77, 78 and 80, a person who, alone or with any related person, (

a) contiols a body corporate that does not conttol a provmcial corporation but tiiat holds or beneficiaUy owns (i) 10% or more of the total number of issued and outstonding shares of a class of voting shares of the corporation, or (ii) shares of a class of voting shares of the corporation to which are attoched 10% or more of die voting rights attochmg to all of die issued and outstanding voting shares of that class. or (

b) holds or beneficiaUy owns 55

(i) 10% or more of die total number of issued and outstonding shares of a class of voting shares of a body corporate, or (ii) shares of a class of voting shares of a body corporate to which are attoched 10% or more of the voting rights attochmg to all of die issued and outstanding voting shares of that class, and the body corporate conttols a provincial corporation, shaU be deemed to be a holding body corporate, and tiie shares and issue or ttansfer of shares of those persons m die body corporate referred to ki clause (

a) or (

b) shall be deemed to be shares or a ttansfer or issue of shares to which sections 77, 78 and 80 apply. Minister's 77(1) The dkcctors of a provincial corporation shall refuse to tor^s^ OT ssu ^Uow the ttansfer or issue of the voting shares of the corporation to be entered in the securities register without the Minister's consent ki either of die following ckcumstances: (

a) k, ki a case where a person and other persons related to him hold or beneficially own immediately before the entty of the ttansfer or issue (

i) more than 10% of die total number of issued and outstonding shares of a class of voting shares of the corporation, or (ii) shares of a class of voting shares of the corporation to which are attoched more than 10% of the voting rights attachmg to all of the issued and outstanding voting shares of that class the entry of the tiansfer or issue would cause the percentoge in either subclause (

i) or (ii) to increase, based on the number of issued and outstonding voting shares or votmg rights after die entry of the ttansfer or issue; (

b) k, in a case where a person and other persons related to him hold or beneficially own immediately before the entty of the ttansfer or issue (i) 10% or fewer of the total number of issued and outstonding shares of a class of votmg shares of die corporation, or (ii) shares of a class of voting shares of tiie corporation to which are attoched 10% or fewer of the votmg rights attochmg to all of the issued and outstanding voting shares of that class, 56

tiie entry of the tiansfer or issue would cause the percentoge in either subclause (

i) or (ii) to mcrease to more than 10%, based on the number of issued and outstanding voting shares or voting rights after the entty of the ttansfer or issue.

(2) Until the Minister's consent is obtained under subsection (1) no person shaU in person or by proxy exercise the voting rights attochmg to any of the voting shares that are held or beneficially owned by the person or related persons referred to in subsection (1).

(3) Notwithstonding subsection (1), where a consent is given under subsection (1) with respect to a person and other persons related to him, no consent under subsection (1) is requked with respect to those persons in respect of a subsequent ti-ansfer or issue of voting shares unless, as a result of the entry of the tiansfer or issue, any of the kinds of holding or ownership of those persons calculated under subsection (1) would undergo an increase of more than 5% from the corresponding kind of holding or ownership calculated immediately after die previous consent was given.

(4) The exception set out in subsection (3) does not apply (

a) to a ttansfer or issue of shares that would result in a change of contiol of the provincial corporation, or (

b) where skice the previous consent was given under this

section any of the kinds of holding or ownership of the person and other persons related to hkn calculated under subsection (1) have decreased by more than 5% from the corresponding kkid of holding or ownership calculated immediately after the previous consent was given.

(5) Where, on the date this

section comes into force, a person and other persons related to him hold or beneficially own (

a) more than 10% of the totol number of issued and outstonding shares of a class of voting shares of the corporation, or (

b) shares of a class of voting shares of the corporation to which are attoched more than 10% of the voting rights attoching to all of the issued and outstonding voting shares of that class the Minister is, for tiie purposes of tiiis section, deemed to have given a consent in respect of tiiat holding or ownership on tiie date this

section comes into force.

(6) The consent of tiie Minister under diis

section is not requked in respect of a tiansfer or issue of shares to an underwriter, as defined in die Securities Act, who receives them in tiiat capacity. 57

(7) Where a consent is required under this section, (

a) die person to whom die shares are to be ttansferred or issued, or (

b) where the person referred to in clause (

a) wUl not be the beneficial owner of the shares, that person and tiie beneficial owner jointly, shaU apply for the consent and shall provide die Minister with any information the Minister requires in support of the application.

(8) On an application under subsection (7), tiie Minister may refuse consent where (

a) any of the holders or beneficial owners to whom the consent relates (

i) is or has been bankrupt, (ii) has been convicted of a criminal offence, an offence under this Act or an offence under die Securities Act or comparable legislation of another jurisdiction in Canada, (iU) is or has been subject to a cease tiading order under the Securities Act or comparable legislation of anotiier jurisdiction in Canada, (iv) is tiie subject of a special examination under

section 273, (

v) is conttavening any provision of this Act or the regulations or of any comparable legislation of anotiier jurisdiction or of any undertaking given to die Minister, or (vi) faUs to provide the information requested under subsection (7), or (

b) k would, in his opinion, be in the pubUc interest to do so, having regard to the following: (

i) tiie natme and sufficiency of the financial resources of the holders or beneficial owners to whom the consent relates as a source of continuing fmancial support for the provincial corporation; (ii) where the ttansfer or issue would result in a change in conttol of the provincial corporation, tiie soundness and feasibUity of plans of die holders or beneficial owners to 58

whom the consent relates for the futme conduct and development of the business of the provincial corporation; (iU) tiie business record and experience of the holders or beneficial owners to whom the consent relates; (iv) whetiier the provincial corporation wUl be operated responsibly by persons who are fit as to character and are competent for that purpose; (

v) the best interests of the financial system ki Alberto.

(9) The consent of the Minister under this

section takes effect on the date set out in the consent, and tiie effective date may be a date before the date the consent is given. Minister's right 78(1) The Minister may ki writing dkect a provincial corporation to information j^ obtain from a pcrsou in whose name a share is registered in the securities register of tiie corporation or who is tiie beneficial owner of a share of the corporation a declaration containing any or aU of the foUowing information: (

a) information conceming die ownership or beneficial ownership of die share; (

b) information as to whether the share is held or beneficially owned by a person who is related to that person, and the name of the related person where applicable; (

c) information as to the place in which ti^ie shareholder and any person for whose use or benefit the share is held are ordmarUy resident; (

d) kiformation conceming die ownership or beneficial ownership of die shares of a holdmg body corporate; (

e) kiformation conceming any other matters speckled by die Minister.

(2) The dkectors of a provincial corporation tiiat is tiie subject of a dkection under subsection (1) shaU ensme tiiat die corporation fortiiwitii compUes with tiie dkection.

(3) A provincial corporation tiiat is the subject of a dkection under subsection (1) may request a person who has possession of or access to die uiformation requked to provide a declaration containing die information to the Minister, and that person shall fortiiwitii comply with the request. Exemption 79(1) jhc Minister may by order exempt any provincial 59

By-laws re shareholder information Reliance on infonnatirai corporation or otiier person from tiie application of

section 77 or 78 ki whole or in part and on any terms and conditions set out in the order.

(2) The Regulations Act does not apply to an order under subsection (1). 80(1) The dkectors of a provkicial corporation may make by-laws (

a) requking any person holding any votmg share of die corporation to submit written declarations (

i) with respect to die ownership and beneficial ownership of a share of die corporation or of a holding body corporate, (ii) widi respect to die place ki which the shareholder and any person for whose use or benefit the share is held are ordinarily resident, (iU) as to whetiier the shareholder is related to otiier persons, and (iv) with respect to any otiier matters tiie dkectors consider relevant for the purposes of sections 76 to 79, (

b) prescribing the times at which and the manner in which any declarations requked under clause (

a) are to be submitted, and (

c) requking any person desiring to have a ttansfer of a share to hkn entered in the secmities register of the corporation to submk a declaration referred to ki clause (

a) as k he were a shareholder.

(2) Where under any by-law made under subsection (1) a declaration is requked to be submitted by any shareholder or person in respect of the ttansfer of any share, the dkectors may refuse to aUow die entiy of the ti-ansfer of die share in tiie securities register of tiie provmcial corporation until the requked declaration has been submitted. 81 A dkector of a provmcial corporation and any otiier person actkig as proxy for a shareholder of the corporation may rely on a stotement made in a declaration made pmsuant to a by-law under

section 80(1) and on thek own knowledge of the ckcumstances for the purposes of determkiing (

a) the residence of a person, (

b) who conttols a body corporate, or 60

Place of annual meeting Calling meetings (

c) any otiier ckcumstances relevant to the performance of thek duties under sections 76 to 79, and the dkector or other person is not Uable in any action for anythmg done or omitted by him in good faith in reliance on tiiat stotement or tiiat knowledge. 82(1) Subject to the by-laws, a meeting of shareholders of a provincial corporation shaU be held at any place in Canada that the dkectors determine, or in the absence of such a determination, at its principal place of business.

(2) Notwithstonding subsection (1), a meeting of shareholders of a provincial corporation may be held outside Canada k all the shareholders entitied to vote at that meeting so agree, and a shareholder who attends a meeting of shareholders held outside Canada is deemed to have so agreed except when he attends the meeting for the express purpose of objecting to the transaction of any business on tiie grounds that the meeting is not lawfully held. 83(1) The dkectors of a provincial corporation shall caU annual meetings of shareholders in accordance with this section.

(2) In die case of a provincial corporation mcorporated under

Part 3, the dkectors shall, after the meetmg caUed pursuant to

section 22, caU an annual meeting, to be held not later than 4 montiis after the end of die fkst fiscal year of the corporation, and subsequentiy not later tiian 4 montiis aifter the end of each fiscal year.

(3) In die case of a provincial corporation that is contkiued under

section 327, tiie dkectors shaU caU an annual meeting not later tiian 4 months after the end of die fiscal year in which letters patent of continuance are issued, and subsequentiy not later tiian 4 montiis after tiie end of each fiscal year.

(4) In the case of an amalgamated provkicial corporation, tiie dkectors shaU call an annual meeting not later tiian 4 months after the date set out ki die letters patent of amalgamation, and subsequentiy not later tiian 4 months after the end of each fiscal year.

(5) A provkicial corporation may apply to tiie Court for an order extending die time widiin which die fkst or die next annual meeting of die corporation shaU be held.

(6) Notice of any application under subsection (5) by a provkicial corporation tiiat is a reporting issuer shaU be fUed witii die Chief of Securities Admkiisttation. 61

(7) If, on an appUcation under subsection (5), the Comt is satisfied that it is in die best interests of the provincial corporation, the Court may extend the tkne ki which the fkst or the next annual meeting of the corporation shall be held, in any manner and on any terms it thinks fit.

(8) The dkectors of a provincial corporation may call a special meeting of shareholders at any time. RecOTd dates 84(1) For tiic purposc of determining shareholders of a provincial corporation (

a) entitled to receive payment of a dividend, (

b) entitled to participate in a liquidation or distribution, or (

c) for any other purpose except the right to receive notice of or to vote at a meetmg, the dkectors may fix in advance a date as the record date for tiiat determination of shareholders, but tiie record date shall not precede by more than 50 days tiie date of the particular action to be taken.

(2) For the purpose of determining shareholders entitied to receive notice of or to vote at a meeting of shareholders, the dkectors may fix in advance a date as the record date for that determination of shareholders, but that record date shall not precede by more than 50 days or by less than 21 days the date on which the meeting is to be held.

(3) If no record date is fixed, (

a) the record date for the determination of shareholders entitied to receive notice of or to vote at a meeting of shareholders shall be (

i) at the close of business on the last busmess day immediately precedkig the day on which the notice is sent, or (ii) if no notice is sent, the day on which die meeting is held, and (

b) the record date for the determination of shareholders for any purpose other than to estoblish a shareholder's right to receive notice of a meeting or to vote shaU be at the close of business on the day on which the dkectors pass tiie resolution relating to that purpose. 62

(4) If a record date is fixed, unless notice of the record date is waived in writing by every holder of a share of tiie class or series affected whose name is set out in the secmities register of the provincial corporation at die close of business on the day the directors fix the record date, notice of die record date shaU be given, not less than 7 days before the date so fixed (

a) by advertisement in a newspaper pubUshed or distiibuted in the locaUty where the corporation has its principal place of business and in each place in Canada where it has a ttansfer agent or where a ttansfer of its shares may be recorded, and (

b) by written notice to each stock exchange in Canada on which the shares of the corporation are Usted for ttading. Notice of 85(1) Notice of the time and place of a meeting of shareholders meetmg ^^ ^ provincial corporation shall be sent not less tiian 21 days and not more than 50 days before the meeting (

a) to each shareholder entitled to vote at the meeting, (

b) to each dkector, and (

c) to the auditor of tiie corporation.

(2) Notwithstonding

section 320(2), a notice of a meeting of shareholders sent by mail to a shareholder, dkector or auditor ki accordance with

section 320(1) is deemed to be sent on the day on which it is deposited in the mail.

(3) A notice of a meeting is not requked to be sent to shareholders who were not registered on the securities register of the provincial corporation on the date determined under

section 84(2) or (3), but failure to receive a notice does not deprive a shareholder of the right to vote at the meeting.

(4) If a meeting of shareholders is adjomned by one or more adjoumments for an aggregate of less than 30 days, it is not necessary, unless the by-laws otherwise provide, to give notice of the adjoumed meeting other tiian by announcement at the time of an adjoumment.

(5) If a meeting of shareholders is adjoumed by one or more adjoumments for an aggregate of 30 days or more, notice of the adjoumed meeting shall be given as for an original meeting but, unless the meeting is adjoumed by one or more adjoumments for an aggregate of more than 90 days,

section 143(1) of the Business Corporations Act as incorporated into this Act by

section 99 of this Act does not apply. 63

(6) AU business tiansacted at a special meeting of shareholders and all business tiansacted at an annual meeting of shareholders, except consideration of the financial stotements and auditor's report, fixmg the number of dkectors for the foUowing year, election of dkectors and reappointtnent of the incumbent auditor, are deemed to be special business.

(7) Notice of a meeting of shareholders at which special business is to be tiansacted shall stole (

a) the nature of that business in sufficient detail to permit the shareholder to form a reasoned judgment on that business, and (

b) tiie text of any special resolution or by-law to be submitted to tiie meeting.

Document details

Collection	Alberta — Bills
Citation	L22 S2 2713
Type	bill
Volume / chapter	L22 S2 2713
Language	en
Format	json
Source	PROVINCIAL
Identifier	0d27b0c097d1447e6c8071afe266926bb91aa675

Source file is stored in the law ingest library (json).