Bill 29 — Third Session, 22Nd Legislature, 40 Elizabeth Ii the Legislative Assembly of Alberta Bill 29 Loan and Trust Corporations Act the Provincial Treasurer (Legislature 22, Session 3)

L22 S3 2582

Alberta — Bills

1991 BILL 29 Third Session, 22nd Legislature, 40 Elizabeth II THE LEGISLATIVE ASSEMBLY OF ALBERTA BILL 29 LOAN AND TRUST CORPORATIONS ACT THE PROVINCIAL TREASURER First Reading Second Reading Committee of the Whole Third Reading Royal Assent Title: 1991 (22nd, 3rd) Bill 29, Loan and Trust Corporations Act

Bill 29 BILL 29 1991 LOAN AND TRUST CORPORATIONS ACT (Assented to ,1991) Table of Contents

Part 1

Interpretation and Application

Definitions 1 Relationships 2 Beneficial ownership 3 Conflicting provisions 4 Manner of issuing letters patent 5

Part 2 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 First directors 12 Effective date of incorporation 13 Capacity of provincial corporation 14 No constructive notice 15 Authority of directors, 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 First directors’ meeting 21 Meeting of shareholders 22 Term of first directors 23 Carrying on business 24 No payments before registration 25 1

Deposit or investment before registration 26

Part 3 Registration Definition 27 Registers 28 Applications re registration 29 Particulars of application 30 Consents and undertakings 31 Power of attorney 32 Publication 33 Names 34 Rejection of application 35 Registration subject to conditions 36 Certificate of registration 37 Time limit for registration 38

Part 4 Principal Place of Business, Records and Returns 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 return 46 Other information to be given to Minister 47 Form of records 48 Legible copies 49 Protection of records 50

Part 5 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 60 Prohibited shareholdings 61 Restrictions on acquisition of shares 62 Acquisition of own shares 63 Alternative acquisition of own shares 64 Redemption of shares 65 2

Donated and escrowed shares 66 Reduction of stated capital 67 Adjustment of stated capital account 68 Repayment, acquisition and reissue of debt obligations 69 Enforceability of contract to purchase shares 70 Commission on sale of shares 71 Payment of dividend 72 Lien on share 73 Limited liability of shareholders 74 Restrictions on issue, transfer 75

Interpretation 76 Minister’s consent to transfer or issue 77 Minister’s right to information 78 Exemption 79 By-laws re shareholder information 80 Reliance on information 81 Place of annual meeting 82 Calling meetings 83 Record dates 84 Notice of meeting 85 Shareholder proposals 86 Shareholder list 87 Quorum 88 Meeting by electronic means 89 Majority vote 90 One share, one vote 91 Corporate shareholder 92 Joint ownership of share 93 Voting 94 Resolution instead of meeting 95 Meeting on requisition of shareholders 96 Meeting called by Court 97 Disputed elections and appointments 98 Application of Business Corporations Act 99, 100

Part 6 Directors and Officers Directors 101 By-laws 102 Unaffiliated directors 103 Residency 104 Persons disqualified from being a director 105 Consent to election or appointment 106 Shareholding not required 107 Election and appointment of directors 108 Cumulative voting 109 Ceasing to hold office 110 Removal of directors 111 Director’s statement 112 Notice of change of directors 113 Filling vacancies 114 3

Meetings of directors 115 Meeting called by Minister 116 Meetings called by board 117 Notice of meeting 118 Adjourned meetings 119 Meetings by electronic means 120 Quorum 121 Resident Canadian requirement 122 Majority vote 123 Executive committee 124 Officers 125 Delegation of fiduciary powers 126 Committees 127 Irregularities 128 Resolution instead of meeting 129 Disclosure of interest 130 Liability of directors and others 131 Duty of care of directors and officers 132 Relief from duty ineffective 133 Dissent by director 134 Indemnification 135 Remuneration of directors 136 Records of meetings 137

Part 7 Insider Trading

Definitions 138 Deemed insiders 139,140 Civil liability of insiders 141

Part 8 Auditors and Financial Statements Qualifications of auditor 142 Appointment of auditor 143 Auditor ceasing to hold office 144 Removal of auditor 145 Filling vacancies 146 Term of office 147 Court-appointed auditor 148 Notice to Minister 149 Rights and liabilities 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 4

Copies of financial statements - provincial corporation 159 Copies of financial statements - registered extra-provincial corporation 160 Duties of audit committee 161

Part 9 Restricted Party Transactions

Interpretation 162 Designation of restricted party 163 Prohibited transactions, guarantees and investments 164 Person previously a restricted party 165 Type of approval required 166 Board approval required - general 167 Board approval not required - general 168 Directors, officers, employees, etc. 169 Financial institutions 170 Prescribed limits 171 Consent to prohibited or restricted transaction 172 Transaction involving trust and estate funds 173 Delegation 174 Review procedures 175 Disclosure by restricted party 176 Duty to report contraventions 177 Onus of proof 178 Applications to Court 179

Part 10 Capacity and Powers Application 180 General powers 181 Restriction on engaging in deposit-taking business 182 Restriction on fiduciary activities 183 Restriction on loan corporations 184 Appointment as executor, etc. 185 Securities restrictions 186 Leasing restriction 187 Receiving deposits 188 Capital base 189 Borrowing by subordinated notes 190 Pledging assets 191 Guarantees 192 Limit on borrowing by trust corporation 193 Other prohibited activities 194

Part 11 Investments Application 195 Prudent investment standards 196 Review procedures 197 Liquidity 198 5

Personal loans 199 Commercial loans 200 Mortgage lending 201 Real estate acquired by realization of security 202 Investment in real estate 203 Prohibited investments 204 Acquisition of assets in default 205 Equity in unincorporated entity 206 Limitation on shareholding 207 Divestment order 208 Collateral security 209 Allocation of security 210 Common trust funds 211 Passing accounts 212 Notice by registered extra-provincial trust corporation 213

Part 12 Fundamental Changes and Arrangements Amalgamation 214 Special approval 215 Purchase or sale of assets 216 Agreement re amalgamation or purchase and sale 217 Shareholder approval of agreement 218 Approval of agreement by Minister 219 Effect of agreement to purchase or sell 220 Effect of amalgamation 221 Purchase of shares for amalgamation or purchase of assets 222 Continuation of fiduciary obligations 223 Arrangements 224

Part 13 Liquidation and Dissolution Staying proceedings 225 No property and no liabilities 226 Proposing liquidation 227 Certificate of intent to dissolve required 228 Issue of certificate 229 Effect of certificate 230 Revocation of certificate of intent to dissolve 231 Liquidation process 232 Letters patent of dissolution 233 Dissolution 234 Application for Court supervision 235 Notice to Minister 236 Effect of order 237 Commencement of liquidation 238 Powers of Court 239 Effect of order for liquidation 240 6

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 others 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 14 Administration 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 directly to Court 267 Application 268 Stay 269 Duty to co-operate with examinations, etc. 270 Demand for information 271 Periodic examination 272 Special examination 273 Powers of person conducting examination 274 Examination of other persons 275 Powers on special examination 276 Appraisal of property 277 Minister’s order to comply 278 Voluntary compliance program 279 Suspension and revocation of registration 280 Protection from liability 281 Order to freeze property 282 Order for compliance 283 Order imposing conditions or for possession and control 284 Powers of Minister 285 Termination of possession and control 286 Application to Court 287 Payment of expenses of proceedings 288 7

Dissolution by Court 289

Definitions 290 Derivative action 291 Relief by Court from oppression or unfairness 292 Notice of application 293 Costs 294 Stay, etc. of application or action 295

Part 15 Offences and Penalties Deemed carrying on business 296 Prohibition re use of name 297 Holding out 298 Activities by promoters, etc. 299 Exemption 300 Misuse of confidential information 301 Representations prohibited 302 False or deceptive statements 303 Other offences 304 Penalties 305 Continuing offence 306 Defence 307 Liability of directors and officers 308 Limitation on prosecution 309 Order to comply and make restitution 310 Penalty for late information 311

Part 16 General Priority of Government claim 312 Unclaimed deposits 313 Contracts with minors, etc. 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 directors, shareholders 320 Notices to corporation 321 Waiver of notice 322 Transfer on death of depositor 323 Payments by mistake 324 Regulations 325

Part 17 Transitional, Consequential, Repeal and Commencement Extension of time 326 Letters patent of continuance 327 Registration of continued provincial trust corporation 328 8

Existing registered extra-provincial companies 329 Extra-provincial loan corporations 330 Existing directors and auditors 331 Committees 332 Grandfathering provision re investments 333 Calculation of time 334 Consequential amendments 335 Repeal 336 Coming into force 337 HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Alberta, enacts as follows:

PART 1

INTERPRETATION AND APPLICATION

Definitions 1(1) In this Act, (a) “auditor” means, with respect to a body corporate, its external auditor, and includes any individual who is responsible for conducting an external audit of the body corporate’s financial statements on behalf of its external auditor; (b) “bank” means a bank 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 or however incorporated; (d) “branch” means an office of a corporation where it offers services to or for the public; (e) “capital base” means the shareholders’ equity of a corporation calculated in the prescribed manner; (f) “Chief of Securities Administration” means the Chief of Securities Administration 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 trusts in its care are combined for the purpose of facilitating investment; 9

(h) “corporation” means a loan corporation or a trust corporation whether incorporated in or outside of Alberta; (i) “Court” means the Court of Queen’s Bench; (j) “debt obligation” means a bond, debenture, note or other evidence of indebtedness or guarantee of a provincial corporation, whether secured or unsecured; (k) “deposit” means, subject to subsection (2), a sum of money that (

i) is paid on terms that 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 the expiry of a specified term, and (iii) is paid or payable in accordance with prescribed requirements, but does not include payments of sums of money that are prescribed; (l) “deposit-taking business” means, subject to subsection (3), (

i) the lending, in the ordinary course of business, of money received by way of deposit, or (ii) any other activity that is financed wholly or to any material extent out of the capital of, or the interest on, money received by way of deposit; (m) “eligible financial institution” means a treasury branch, credit union or member institution of the Canada Deposit Insurance Corporation or of any other deposit insurance or guarantee plan prescribed by the Minister, 10

(n) “entity” includes a body corporate, trust, partnership, fund or other unincorporated association or organization, the Crown in right of Canada or in right of a province, an agency of the Crown, a foreign government and any agency of a foreign government, but does not include an individual; (o) “extra-provincial body corporate” means a body corporate (

i) incorporated otherwise than by or under

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

section 16 of the Alberta Act (Canada); (p) “extra-provincial corporation” means a corporation that was incorporated under the laws of Canada or of any province other than Alberta; (q) “fair market rate” means (

i) in respect of the acquisition or disposition of property, including a lease or rental of property, and subject to regulations made with respect to the 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 fair sale or lease, assuming that the price is not affected by undue stimuli, with both the seller and buyer acting prudently and knowledgeably, (ii) subject to subclause (iii), 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 transaction in an open market between willing parties to a transaction of that nature and on terms that, having regard to open market conditions, are competitive and not unreasonable, and (iii) in respect of the provision of services that are provided generally to customers of the provincial corporation or subsidiary in question, 11

the rate and terms that are offered in respect of those services to customers generally in the ordinary course of that corporation’s or subsidiary’s business; (r) “financial institution” means (

i) a securities dealer; (ii) an insurer; (iii) any member institution of the Canada Deposit Insurance Corporation or of any other deposit insurance or guarantee plan prescribed by the Minister; (s) “improved real estate” means (

i) land on which there exists a building or on which a building is being or is about to be constructed and the adjacent land used or to be used in connection with the building, (ii) land on which bona fide farming operations are being conducted, and (iii) vacant land that is restricted by law in its use to commercial, industrial or residential purposes, whether by zoning or otherwise; (t) “instrument of incorporation” means the special Act, charter, letters patent or other document incorporating or amalgamating a corporation, and includes all amendments to it; (u) “insurer” means an insurer, agent, broker or adjuster within the meaning of those terms in the Insurance Act; (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 treasury 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 fair sale, assuming that the price is not affected by undue stimuli, with both the seller and the buyer acting prudently and knowledgeably; 12

(x) “Minister” means the member of the Executive Council charged by the Lieutenant Governor in Council with the administration of this Act; (y) “officer” means, in relation to a corporation, (

i) its chief executive officer, president, chairman, vice-president, vice-chairman, treasurer, secretary, general manager or assistant general manager or any combination of those positions, (ii) an individual who performs functions for the corporation normally performed by a person mentioned in subclause (i), or (iii) any other person designated as an officer by by-law or by the board of the corporation; (z) “ordinary resolution” means a resolution passed by a majority of the votes cast by the shareholders who voted in respect of that resolution or signed by all the shareholders entitled to vote on that resolution; (aa) “person” means an individual, entity or personal representative; (bb) “personal representative” means an executor, administrator, guardian, committee, trustee, assignee, receiver or liquidator; (cc) “prescribed” means, (

i) with respect to a form, in a form authorized or provided by the Minister and containing the information required by the 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 (iii) any other person whose membership in a profession would tend to lend credibility to a 13

statement made or opinion given by that person, and includes an individual who is a member of or works in a professional capacity for a partnership, body corporate or other association of persons that is a professional adviser; (ee) “provincial corporation” means a corporation incorporated or continued 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 applied to a security, means a security that (

i) specifies a person entitled to the security or to the rights it evidences, and the transfer of which is capable of being recorded in a securities register, or (ii) bears a statement that it is in registered form; (ii) “relative”, when used with respect to individuals, 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 the meaning of the Securities Act; (ll) “security” means, except in

Part 5, a security within the meaning of the Securities Act, and includes a deposit and any instrument evidencing a deposit; (mm) “special resolution” means a resolution passed by a majority of not less than 2/3 of the votes cast by the shareholders who voted in respect of that resolution or signed by all the shareholders entitled to vote on that resolution; (nn) “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; 14

(oo) “total assets” means the assets of a corporation calculated in the prescribed manner and, in the case of a trust corporation, includes cash and securities earmarked under

section 188(5); (pp) “trust corporation” means a body corporate incorporated or operated for the purposes of (

i) offering its services to the public as executor, administrator, trustee, bailee, agent, custodian, receiver, liquidator, sequestrator, assignee or guardian or trustee of a minor’s estate or of the estate of a mentally incompetent person, and (ii) carrying on the deposit-taking business, except in the case of a body corporate whose registration is subject to a term, condition or restriction prohibiting it from carrying on the deposit-taking business, but does not include a bank, a treasury branch, a loan corporation or a credit union; (qq) “voting share” means a share of any class of shares of a body corporate carrying voting rights under all circumstances and a share of any class of shares carrying voting rights by reason of the occurrence of any contingency that has occurred and is continuing.

(2) For the purposes of subsection (1)(k)(i), money is paid on terms that are referable to the provision of property or services or to the giving of security if (

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

b) it 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 delivery or return of any property, whether in a particular state of repair or otherwise.

(3) Notwithstanding subsection (1)(l), a person shall not be considered to be carrying on the deposit-taking business if 15

(

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 ancillary to another business purpose, whether or not in connection with the issue of debentures or other securities. Relationships 2(1) For the purposes of this Act, (

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

b) the affiliates of an entity are deemed to be affiliated with all other entities with which the entity is affiliated.

(2) For the purposes of this Act, (

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

b) a person controls a trust, partnership, fund or other unincorporated entity if more than 50% of the beneficial interest, however designated, into which the entity is divided is held or beneficially owned by that person and the person is able to direct the affairs of the entity; (

c) notwithstanding clauses (

a) and (b), a person controls an entity if the person has, in relation to the entity, any direct or indirect influence that, if exercised, would result in control in fact of the entity.

(3) A holding body corporate is deemed to control any entity that is controlled or deemed to be controlled by a subsidiary of the holding body corporate.

(4) An entity that controls another entity is deemed to control any entity that is controlled or deemed to be controlled by the other entity.

(5) For the purposes of this Act, a body corporate is the holding body corporate of all of its subsidiaries. 16

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

a) it is controlled by (

i) that other, (ii) that other and one or more bodies corporate each of which is controlled by that other, or (iii) 2 or more bodies corporate each of which is controlled 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 restricted party with respect to a provincial corporation if that person (

a) is a director or officer of the corporation, (

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

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

d) holds or is a beneficial owner of voting shares of an affiliate 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 affiliate, (

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 affiliates, if that person is actually engaged in auditing the corporation or affiliate, (

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

a) or (c), (

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

a) or (c), who has the same home as that person, 17

(

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

c) is a body corporate, is a director 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 attaching to all of the issued and outstanding voting shares of the body corporate, (

k) is a body corporate that is controlled by a person referred to in clause (b), (e), (f), (

g) or (i), (

l) is a body corporate in which the corporation holds or beneficially owns voting shares to which are attached 10% or more of the voting rights attaching to all of the issued and outstanding voting shares of the body corporate, (

m) is (

i) a partner of the corporation and has a 10% or greater beneficial interest in the partnership, or (ii) a party to and has a 10% or greater interest in a joint venture agreement to which the corporation is also a party and the corporation has a 10% or greater beneficial interest in the partnership or joint venture, (

n) is an affiliate of the corporation or a director or officer of an affiliate of the corporation, or (

o) is designated under

section 163 as a restricted party.

(8) Where in contemplation of a person’s becoming a restricted party of a provincial corporation the person enters into a transaction with, or is given a guarantee by, the provincial corporation or its subsidiary, or the corporation or its subsidiary makes an investment in the securities of the person, the person is deemed to be a restricted party of the provincial corporation with respect to that transaction, guarantee or investment.

(9) Notwithstanding subsection (7)(

c) and (n), unless the regulations prescribe otherwise, (

a) a financial institution referred to in

section 1(1)(r)(ii) or (iii) that wholly owns a provincial corporation is not a restricted party with respect to that corporation, and 18

(

b) a wholly owned subsidiary of a provincial corporation is not a restricted party with respect to that corporation.

(10) Where the Minister is satisfied that 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 the status of restricted party of the corporation, subject to any terms and conditions the Minister considers appropriate. Beneficial ownership 3(1) For the purposes of this Act, a security or other interest is beneficially owned by a person when it is held directly or through a personal representative or other intermediary for the use or benefit of that person otherwise than as a security interest.

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

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

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

(5) If a person owns securities in a corporation that itself owns securities in a body corporate, in determining the person’s beneficial ownership of securities in the body corporate for the purposes of subsection (2) or (3) no regard shall be taken of the securities of the body corporate that are owned by the corporation. Conflicting provisions 4(1) Where there is a conflict between (

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

b) a provision of this Act or the regulations, the provision of this Act or the regulations, as the case may be, prevails. 19

(2) To the extent that there is a conflict between the Business Corporations Act and this Act or the regulations in their application to a restricted party, this Act or the regulations prevail.

(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 other prescribed statute, or (

d) the 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 the extent that there is any inconsistency in their application to a given situation between a provision in

Part 9 that prohibits or restricts any activity and any other provision of this Act or the regulations, the provision in

Part 9 prevails.

(5) To the extent that there is any inconsistency in their application to a given situation between a provision in

Part 9 that permits an activity and any provision of any other Part of this Act that prohibits or restricts the activity, that other provision prevails. Manner of issuing letters patent 5(1) Where this Act authorizes the Lieutenant Governor in Council to issue letters patent, letters patent of dissolution or letters patent of continuance, the letters patent are sufficiently issued if they are issued by the Minister pursuant to an order of the Lieutenant Governor in Council directing the Minister to do so.

(2) Notwithstanding

section 8 of the Department of the Attorney General Act, letters patent, supplementary letters patent, letters patent of continuance and letters patent of dissolution issued under this Act need not be issued under the Great Seal of the Province. 20

PART 2 INCORPORATION Letters Patent and Incidents of Incorporation Incorporation6(1) The Lieutenant Governor in Council may, on the recommendation of the Minister, incorporate a provincial loan corporation or a provincial trust corporation by the issue of letters patent on the application of one or more persons.

(2) No loan corporation or trust corporation may be incorporated in Alberta otherwise than by letters patent under this Act. Application7(1) An application for letters patent to incorporate a provincial corporation shall be in the prescribed form and shall be filed with the Minister.

(2) On filing an application for letters patent, the Minister (

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

b) may require the applicant to provide any information, material and evidence the Minister considers necessary in addition to the information, material and evidence required to be provided in or with the application. Conditions for issuing letters patent 8 The Lieutenant Governor in Council shall not issue letters patent to incorporate a provincial corporation without being satisfied that (

a) it is in the public interest to establish an additional provincial loan or trust 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) the proposed capital structure and the rights, privileges, restrictions and conditions attaching to each class of shares are acceptable to the Minister, 21

(

d) each person who, based on the subscriptions for shares of the proposed corporation, will hold or beneficially own 10% or more of any class of shares of the proposed corporation can demonstrate the adequacy of his financial resources and is fit as to character to hold or own the shares subscribed for, (

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

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

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

h) the corporation intends to offer to the public the services set out in the application for incorporation. Contents of letters patent 9 The letters patent of a provincial corporation shall set out (

a) the name of the corporation, (

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

c) the number of directors or, subject to

section 109(1)(a), the minimum and maximum number of directors of the corporation, and (

d) the full name, residential address, citizenship and occupation of (

i) each of the first directors of the corporation, (ii) each person who, based on the subscriptions for shares of the corporation, will hold or beneficially own 10% or more of any class of shares of the corporation, and (iii) each of the applicants. Provisions in letters patent 10 The Lieutenant Governor in Council may set out in the letters patent incorporating a provincial corporation any provision not contrary to this Act that the Lieutenant Governor in Council 22

considers advisable to take into account the particular circumstances of the corporation. Notice of issue of letters patent 11 The Minister shall cause to be published in The Alberta Gazette a notice of the issuance of letters patent incorporating a provincial corporation. First directors12 The first directors of a provincial corporation are the directors named in the application for letters patent to incorporate the corporation. Effective date of incorporation 13(1) A provincial corporation comes into existence on the date set out in its letters patent.

(2) Letters patent are conclusive proof for the purposes of this Act and for all other purposes (

a) that the provisions of this Act in respect of incorporation and all requirements precedent and incidental to incorporation have been complied with, and (

b) that the provincial corporation has been incorporated under this Act as of the date shown in the letters patent. Capacity of provincial corporation 14(1) Subject to this Act, the 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 affairs and exercise its powers in any jurisdiction outside Alberta to the extent that the laws of that jurisdiction permit.

(2) A provincial corporation shall not (

a) carry on business or exercise any power that it is prohibited from carrying on or exercising by this Act, the regulations, the by-laws or any terms or conditions imposed on its registration, or (

b) exercise any of its powers in a manner that is contrary to this Act or the regulations. 23

No constructive notice 15 No person is affected by or is deemed to have notice or knowledge of the contents of a document concerning a provincial corporation by reason only that the document has been filed by the Minister or is available for inspection at an office of the corporation. Authority of directors, officers and agents 16 A provincial corporation, a guarantor of an obligation of the corporation or a person claiming through the corporation may not assert against a person dealing with the corporation or dealing with any person who has acquired rights from the corporation (

a) that the instrument of incorporation or by-laws have not been complied with, (

b) that the persons named in the most recent notice of directors filed by the Minister under this Act are not the directors of the corporation, (

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

i) has not been duly appointed, or (ii) has no authority 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 director, officer or agent of the corporation with actual or usual authority to issue the 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. Supplemen tary letters patent to amend 17(1) On the application of a provincial corporation the Minister may issue supplementary letters patent to amend the letters patent of the corporation (

a) to change its name, (

b) in the case of a provincial loan corporation, to continue it as a provincial trust corporation, (

c) in the case of a provincial trust corporation, to continue it as a provincial loan corporation, 24

(

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 all or any of its shares and add, change or remove any rights, privileges, restrictions and conditions, including rights to accrued dividends, in respect of all or any of its shares, whether issued or unissued, (

g) to change the shares of any class or series, whether issued or unissued, into a different number of shares of the same class or series or into the 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, restrictions and conditions attaching to those shares, (

i) to authorize the directors to divide any class of unissued shares into series and fix the number of shares in each series and the rights, privileges, restrictions and conditions attaching to those shares, (

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

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

i) or (j), or (

l) to add, change or remove restrictions on the transfer of shares.

(2) No application shall be made under under subsection (1) unless it has been authorized by a special resolution of the provincial corporation.

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

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, 25

(

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, privileges, restrictions or conditions attached to the shares of that class and, without limiting the generality of the foregoing, are entitled to vote on a proposal (

i) to remove or change prejudicially rights to accrued 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 prejudicially conversion privileges, options, voting, transfer or pre-emptive rights, rights to acquire securities of the provincial corporation, or sinking fund provisions, (

d) to increase the rights or privileges of any class of shares having rights or privileges equal or superior to the shares of that class, (

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

f) to make any class of shares having rights or privileges inferior to the shares of that 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 the shares of that class.

(4) The holders of a series of shares of a class are entitled to vote separately as a series under subsection (3) if that series of a class is affected by an amendment differently than other shares of the same class are affected. (5) Subsections (3) and (4) apply whether or not the shares of a class otherwise carry the right to vote.

(6) A proposal to amend referred to in subsection (3) is adopted when the holders of the shares of each class entitled to vote 26

separately on it as a class have approved the amendment by a special resolution.

(7) The directors of a provincial corporation may, if authorized by the shareholders in the special resolution authorizing the amendment, revoke the resolution before it is acted on without further approval of the shareholders. Supplemen tary letters patent to amalgamate 18 On the application of the corporations involved the Minister may, after having approved an amalgamation agreement under

section 219, issue supplementary letters patent to amalgamate the corporations and continue them as one provincial corporation. Issue of supplemen tary letters patent 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(1)(

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

section 35(b).

(2) On the filing 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 requires, in The Alberta Gazette and in a newspaper having general circulation in the locality where the principal place of business of the provincial corporation is located, and (

b) may require the applicant to provide any information, material and evidence the Minister considers necessary in addition to the information, material and evidence required to be provided in or with the application.

(3) The Minister shall not issue supplementary letters patent (

a) to continue a provincial loan corporation as a provincial trust corporation or to continue a provincial trust corporation as a provincial loan corporation unless he is satisfied that (

i) it is in the public interest to so continue the corporation, (ii) the management of the applicant is fit, both as to character and as to competence, to manage the continued corporation, 27

(iii) the proposed capital structure of the continued corporation and the rights, privileges, restrictions and conditions attaching to each class of shares are acceptable to the Minister, (iv) each person who, based on the subscriptions for shares in the continued corporation, will hold or beneficially own 10% or more of any class of shares of the continued corporation, or who holds or beneficially owns or on the issue of the supplementary letters patent will hold or beneficially own such shares, can demonstrate the adequacy of his financial resources and is fit as to character to hold or own the shares subscribed for, (

v) each director of the applicant is fit, both as to character and as to competence, to be a director of the continued corporation, (vi) the depositors of the continued corporation will be adequately protected, (vii) the proposed plan of operation of the continued corporation is feasible, and (viii) 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 trust corporation as a provincial loan corporation unless he is satisfied that arrangements have been made to transfer to another registered trust corporation the business in relation to which the provincial trust corporation acted in a fiduciary capacity, and those arrangements are adequate to protect the persons in relation to which the provincial trust corporation acted in a fiduciary capacity. (4) Subsection (3)(

b) does not apply so as to require a provincial trust corporation that has applied to be continued as a provincial loan corporation to transfer money received by it as deposits.

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

a) deposits received by the provincial loan corporation under

section 188(1)(

a) are deemed to be deposits received under

section 188(2)(a), and 28

(

b) deposits received by the provincial loan corporation under

section 188(1)(

b) are deemed to be deposits received under

section 188(2)(b).

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

a) deposits received by the provincial trust corporation under

section 188(2)(

a) are deemed to be deposits received under

section 188(1)(a), and (

b) deposits received by the provincial trust corporation under

section 188(2)(

b) are deemed to be deposits received under

section 188(1)(b). Names 20(1) Subject to the 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) that is identical to the name of (

i) a body corporate, whether in existence or not, incorporated under the laws of Alberta, (ii) an extra-provincial body corporate registered in Alberta, or (iii) a body corporate incorporated by or under

an Act of the Parliament of Canada, (

c) that is similar to the name of (

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

an Act of the Parliament of Canada, if the use of that name is confusing or misleading, (

d) that does not meet the requirements prescribed by the regulations, 29

(

e) that, in the case of a trust corporation, does not include “trust” or “fiducie” together with “corporation”, “company”, “compagnie”, “limited”, “limitée” or “société”, or (

f) that, in the case of a loan corporation, does not include “loan” or “prêts” together with “corporation”, “company”, “compagnie”, “limited”, “limitée”, or “société”.

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

(3) Where, through inadvertence or otherwise, a provincial corporation obtains a name contrary to this section, the Minister may issue supplementary letters patent changing the name of the corporation to a name specified in the supplementary letters patent. Organization and Commencement First directors’ meeting 21(1) After the issue of letters patent incorporating a provincial corporation under this Part, a meeting of the directors of the corporation shall be held, and at that meeting the directors may, subject to this Part, (

a) make by-laws, (

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

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

d) appoint officers, (

e) appoint an auditor to hold office until the first meeting of shareholders, (

f) make banking arrangements, and (

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

(2) An applicant for letters patent to incorporate the provincial corporation or a director named in the application for letters patent may call the meeting of the directors referred to in subsection (1) 30

by giving not less than 5 days’ notice to each director, stating the time and place of the meeting. Meeting of shareholders 22(1) When the capital base and the capital accounts of a provincial corporation incorporated under this Part reach the applicable amounts referred to in

section 35(b), the directors shall forthwith call a meeting of the shareholders of the corporation.

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

section 85.

(3) The shareholders shall by ordinary resolution at the meeting referred to in subsection (1) (

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

b) elect directors to hold office for a term expiring not later than the close of the first annual meeting of shareholders following the election, and (

c) appoint an auditor to hold office until the close of the first annual meeting of shareholders. Term of first directors 23 A director named in the application for letters patent to incorporate a provincial corporation holds office until the election of directors at the meeting of shareholders referred to in

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

Part 3. No payments before registration 25 Until a provincial corporation incorporated under this

Part is registered under

Part 3, 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 the payment of the remuneration of not more than 2 officers, (

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

c) for the payment of clerical assistance, legal services, accounting services, office accommodation at one 31

location, office expenses, advertising, stationery, postage and travel expenses, if any, and (

d) for other prescribed purposes. Deposit or investment before registration 26 A provincial corporation incorporated under this Part may, before it becomes registered under

Part 3, (

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

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

PART 3 REGISTRATION Definition27 In this Part, “application for registration” means any of the applications referred to in

section 29. Registers28(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 established a register called the “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 trust corporation or loan corporation that has been granted registration, (

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

c) the suspension or revocation of the registration of a trust 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 hours, examine the registers and take extracts from or obtain copies of them. 32

Applications re registration 29(1) A corporation that is duly constituted or incorporated under the laws of Alberta or of Canada or of another province may apply for initial registration as a trust corporation or a loan corporation.

(2) A registered loan corporation may apply to change its registration to that of a trust corporation and a registered trust corporation may apply to change its registration to that of a loan corporation.

(3) A registered corporation may apply to amend the terms, conditions and restrictions of its registration. Particulars of application 30(1) An application for registration shall be in the prescribed form and shall be filed with the Minister together with any other information, material and evidence the form specifies.

(2) On receipt of an application for registration the Minister may require the applicant to provide any information, material and evidence the Minister considers necessary in addition to the information, material and evidence required to be provided in or with the application.

(3) Where a trust corporation wishes to have a term, condition or restriction imposed on its registration prohibiting it from carrying on the deposit-taking business, it shall so request in the application for registration.

(4) Where the activities of the corporation will involve the deposit-taking business, the application for registration shall be accompanied by evidence that the corporation will from the time of registration be a member of the Canada Deposit Insurance Corporation or that the corporation’s deposits will be insured by some other similar public agency approved by the Minister.

(5) An application for registration as a trust corporation shall set out the classes of service in relation to which the corporation proposes to act in a fiduciary capacity.

(6) An application by a provincial corporation incorporated under

Part 2 shall set out the sums of money paid or to be paid by the corporation in connection with its incorporation and organization. Consents and undertakings 31(1) Where an extra-provincial loan or trust corporation applies for registration, the application shall be accompanied by 33

(

a) a consent in writing authorizing the Minister to conduct examinations under sections 272 and 273 at the 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 will provide to the Minister any information that the Minister requires in the administration of this Act and that the corporation will comply with the applicable provisions of this Act and with any terms, conditions and restrictions imposed on its registration.

(2) An undertaking under subsection (1) shall be accompanied by a certified copy of the resolution of the board of directors authorizing the extra-provincial loan or trust corporation’s officers to apply for registration under this Act and authorizing the execution of the undertaking.

(3) Where a provincial corporation applies for registration, the application shall be accompanied by (

a) a consent in writing authorizing 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 the subsidiaries of the corporation will provide to the Minister any information that the Minister requires in the administration of this Act Power of attorney 32(1) Where an extra-provincial loan or trust corporation applies for registration, the application shall be accompanied by (

a) a power of attorney 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 attorney under this

section (

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

b) shall be accompanied by the statutory declaration of the witness referred to in clause (

a) in the prescribed form. 34

(3) When an extra-provincial loan or trust corporation changes any of its agents in Alberta, it shall forthwith file with the Minister a new power of attorney complying with subsection (2).

(4) An extra-provincial loan or trust corporation shall send to the Minister a notice in the prescribed form of any change in the address of its agents within 15 days after the change occurs.

(5) A copy of a power of attorney under this

section certified by the Minister is sufficient evidence for all purposes of the power and authority of the person or persons named in it to act on behalf of the extra-provincial loan or trust corporation. Publication33 Where the Minister receives an application for registration, the Minister may require the applicant to publish notice of the application, containing any information the Minister requires, in The Alberta Gazette and in a newspaper having general circulation in any locality the Minister directs. Names 34(1) Subject to the regulations, no corporation shall be registered with a name that does not meet the requirements of

section 20(1).

(2) Subject to this Act and the regulations, a corporation may be registered that has a name in an English form, a French form, an English form and a French form or a combined English and French form, and it may be legally designated in Alberta by any such name.

(3) Where a corporation has a name that contravenes subsection (1), the Minister may register the corporation if it undertakes either to change its name to a name that does not contravene subsection (1) or to carry on business in Alberta under a name that does not contravene subsection (1).

(4) Where, through inadvertence or otherwise, a corporation becomes registered with a name that contravenes subsection (1), the Minister may order as a condition of registration that the corporation carry on business under a name specified in the order. Rejection of application 35 Subject to

section 36, the Minister shall reject an application for registration (

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

Part 2, (

i) the meeting of shareholders referred to in

section 22 has been held, and 35

(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 stated capital account for issued common shares or the amount of any other prescribed capital account of the corporation, or a combination of those amounts, (

A) in the case of a trust corporation whose registration is going to be subject to a term, condition or restriction prohibiting it from carrying on the deposit-taking business and that is not wholly owned by a financial institution, is at least equal to the greater of (I) $2 000 000, and (II) any greater amount required by the Minister, (

B) in the case of a trust corporation whose registration is going to be subject to a term, condition or restriction prohibiting it from carrying on the deposit-taking business and that is wholly owned by a financial institution, is at least equal to an amount required by the Minister, or (

C) in any other case is at least equal to the greater of (I) $3 000 000 in the case of a loan corporation and $5 000 000 in the case of a trust corporation, and (II) any greater amount required by the Minister, and (ii) the corporation has a capital base that is adequate, taking into account the nature of the business that it proposes to engage in, the 36

expected volume of its business and any restrictions on its business, and that is in an amount that is at least equal to the corresponding capital account amount for that corporation required under subclause (i), (

c) unless the corporation satisfies the Minister that it has the capacity and power to engage in the activities of a trust corporation or a loan corporation, as the case may be, (

d) if the applicant is not a corporation referred to in

section 29(1), (

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

i) it is in the public interest to register an additional trust corporation or loan corporation, (ii) the management is fit, both as to character and as to competence, to manage the corporation, (iii) the capital structure and the rights, privileges, restrictions and conditions attaching to each class of shares are acceptable to the Minister, (iv) each person who, immediately after the registration, will hold or beneficially own 10% or more of any class of the issued and outstanding shares of the corporation can demonstrate the adequacy of his financial resources and is fit as to character to hold or own those shares, (

v) each director is fit, both as to character and as to competence, to be a director of the corporation, (vi) the depositors of the corporation will be adequately protected, (vii) the proposed plan of operation of the corporation is feasible, and 37

(viii) the corporation intends to offer to the public the services set out in the application for registration and the applicant has the capability to provide those services, or (

f) if the Minister is not satisfied as to the adequacy of any information received with or in support of the application for registration. Registration subject to conditions 36(1) Where the Minister is not satisfied as to any or all of the matters referred to in

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

e) or (

f) or where for any other reason the Minister considers it appropriate to do so, the Minister may, instead of rejecting the application, approve the registration 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 restrictions the Minister considers appropriate, or (

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

(2) Where a trust corporation’s application for registration contains a request referred to in

section 30(3), the Minister may impose such a term, condition or restriction on the registration of the corporation accordingly.

(3) The Minister may at the request or with the consent of a registered corporation (

a) impose terms, conditions and restrictions on the registration of the corporation in 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. Certificate of registration 37(1) Where the Minister registers a corporation the Minister shall issue a certificate of registration in the prescribed form and the certificate of registration is conclusive proof for the purposes of this Act and for all other purposes that the provisions of this Act in respect of registration of the corporation and all requirements 38

precedent and incidental to registration have been complied with, and that the corporation has been registered under this Part as of the date shown in the certificate of registration.

(2) The Minister shall publish in The Alberta Gazette notice of the registration of a corporation. Time limit for registration 38 Where a provincial corporation that is incorporated under

Part 2 does not become registered within one year after the date of its letters patent, or within any further period that the Minister may on application allow, (

a) the directors shall ensure that the corporation forthwith takes all reasonable steps under

Part 13 toward its dissolution, and (

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

PART 4 PRINCIPAL PLACE OF BUSINESS, RECORDS AND RETURNS Principal place of business and records office 39(1) A provincial corporation shall at all times have a principal place of business in Alberta.

(2) A notice of (

a) the principal place of business, and (

b) a separate records office, if any, shall be sent to the Minister with the application for registration under

section 29.

(3) The directors 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. 39

(4) Unless the directors 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 ensure that its principal place of business and its records office are (

a) accessible to the public during normal business hours, and (

b) readily identifiable from the address or other description given in a notice under subsection (2) or (5). Record keeping 40(1) A provincial corporation shall keep at its records office (

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

b) minutes of meetings and resolutions of shareholders, (

c) a register of directors setting out, with respect to each person who is or has been a director, (

i) the person’s name, (ii) the dates on which the person became and ceased to be a director, and (iii) the person’s full residential address while a director, (

d) a securities register complying with

Part 6 of the Business Corporations Act as incorporated by

section 53 of this Act, (

e) a copy of the procedures referred to in

section 197, and (

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

section 156(1).

(2) Notwithstanding subsection (1), a central securities register may be maintained 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 Alberta designated by the directors. 40

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

(4) A registered extra-provincial loan corporation and a registered extra-provincial trust corporation shall maintain at a place in Alberta designated by the directors a copy of its instrument of incorporation and its by-laws, and a copy of minutes and registers referred to in subsection (1)(b), (

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

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

a) adequate accounting records that will enable the Minister to determine the financial position of the corporation and whether it is in compliance with this Act and the regulations, (

b) records containing minutes of meetings and resolutions of the directors and every committee of directors, (

c) a record of all investments held by the corporation, (

d) copies of all returns to the Minister required by this Act or the regulations, and (

e) in the case of a trust 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 liabilities of the corporation carried on, supervised or accounted for at that place, but the corporation shall ensure that 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 directors to ascertain the financial position of the corporation. Access to corporate records 42(1) The directors and shareholders of a provincial corporation and their agents and legal representatives may examine the records referred to in

section 40(1) during the usual business hours of the corporation free of charge. 41

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

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

section 40(1)(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 the usual business hours of the provincial corporation on payment of a reasonable fee and may make copies of those records. Right to list of shareholders 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 the statutory declaration referred to in subsection (5), any person may on application require the corporation or its agent to furnish within 10 days from the receipt of the statutory declaration a list (in this

section referred to as the “basic list”) made up to a date not more than 10 days before the date of receipt of the statutory declaration, setting out (

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

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

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

(2) A person requiring a provincial corporation to supply a basic list may, by stating in the statutory declaration that he requires supplemental lists, require the corporation or its agent on payment of a reasonable fee to furnish supplemental lists setting out any changes from the basic list in the information provided in it for each business day following the date the basic list is made up to.

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

a) on the date the basic list is furnished, if the information relates to changes that took place before that date, and (

b) on the business day following the day to which the supplemental list relates, if the information relates to changes that took place on or after the date the basic list was furnished. 42

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

(5) A statutory declaration shall state (

a) the name and address of the applicant, (

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

c) that the basic list and any supplemental lists obtained pursuant to subsection (2) will not be used except as permitted under

section 44.

(6) If the applicant is a body corporate, the statutory declaration shall be made by a director or officer of the body corporate. Use of list44 No person shall use a list of shareholders obtained under this

section except in connection with (

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

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

c) any other matter relating to the affairs of the provincial corporation. Trafficking in list 45 No person shall sell or purchase, offer for sale or purchase or otherwise traffic in a list of holders of securities of a provincial corporation. Annual return46(1) A registered corporation shall prepare annually and send to the Minister not later than 3 months after the end of each fiscal year an annual return in the prescribed form relating to the fiscal year.

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

a) the financial statements and report of the auditor for the fiscal year to which the return relates, prepared in accordance with sections 156(2) and 157, 43

(

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

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

(3) In the case of an extra-provincial corporation, the annual return shall be accompanied by the financial statements and auditor’s report on them for the fiscal year to which the return relates that the corporation must provide or has provided to a Minister of the Crown or a government official or agency in accordance with the requirements of applicable trust or loan corporation legislation governing the corporation in its home jurisdiction.

(4) Where, (

a) in the case of a provincial corporation, the financial statements referred to in subsection (2) would be required by

section 157 to be on a consolidated basis, or (

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

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

c) separate audited financial statements in respect of the provincial corporation or extra-provincial corporation, as the case may be, where it is a holding body corporate, and (

d) separate audited financial statements in respect of the provincial corporation or extra-provincial corporation, as the case may be, where the provincial corporation or extra-provincial corporation is a subsidiary.

(5) Where the provincial corporation or extra-provincial corporation is a subsidiary, the Minister may by notice in writing require the holding body corporate of the provincial corporation or extra-provincial corporation to forward to the Minister the holding body corporate’s financial statements and auditor’s report, and may in the notice direct the basis on which those financial statements are to be prepared and the period of time to which they are to relate.

(6) Where the provincial corporation or extra-provincial corporation is a holding body corporate, the Minister may by notice 44

in writing require the provincial corporation or extra-provincial corporation to forward to the Minister separate audited financial statements in respect of any of its subsidiaries, and may in the notice direct the basis on which those financial statements are to be prepared and the period of time to which they are to relate. Other information to be given to Minister 47(1) A registered corporation shall send to the Minister a copy of every statement of a financial nature relating to the corporation that is furnished to its shareholders within 5 days after the furnishing of the statement to the shareholders.

(2) A registered corporation shall send to the Minister (

a) a copy of any application and supporting documents made under a law of Canada or of a province other than Alberta for a change to its instrument of incorporation or its registration status, together with a copy of the approval or refusal of the application, within 7 days of the making of the application or the receipt of the approval or refusal, and (

b) a copy of any change made to its instrument of incorporation or to its ability to carry on business in any other jurisdiction in Canada, within 7 days after the effective date of the change.

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

a) of the making of an order by a court or person in another jurisdiction that is in the nature of an order or direction under

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

b) of the corporation’s being subject to an arrangement in another jurisdiction that is in the nature of a program of voluntary compliance under

section 279 of this Act.

(4) A registered extra-provincial corporation shall send to the Minister notice of any change in the membership of its board of directors within 30 days after the effective date of the change.

(5) A registered corporation shall provide to the Minister at the times prescribed by the Minister any financial or other information that is prescribed by the Minister. Form of records 48 All registers and other records required by this Act to be prepared and maintained by a registered corporation may be in 45

bound or loose-leaf form or in photographic film form, or may be entered or recorded by any system of mechanical or electronic data processing or any other information storage device that is capable of reproducing any required information in legible written form within a reasonable time. Legible copies 49(1) If a person is entitled to examine any register or record that 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 shall (

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

b) provide facilities to enable that person to examine the text of the register or record in legible written form otherwise than by providing a reproduction of that text, and shall allow that person to make copies of that register or record.

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

a) prevent loss or destruction of, (

b) prevent falsification of entries in, and (

c) facilitate detection and correction of inaccuracies in, the registers and other records required by this Act to be prepared and maintained.

PART 5 SHARES AND SHAREHOLDERS Definition51 In this Part, “security” means, subject to

Part 6 of the Business Corporations Act as incorporated by

section 53 of this Act, a share of any class or series of shares or a debt obligation of a body corporate, and includes a certificate evidencing such a share 46

or debt obligation and includes a warrant, but does not include a deposit or any instrument evidencing a deposit in a corporation.

Interpretation52 For the purposes of sections 63, 64, 65, 67 and 72, deposits in a provincial trust corporation shall be deemed to be a liability of the corporation notwithstanding that the deposits are held by it as trustee. Application of Business Corporations Act 53

Part 6 of the Business Corporations Act applies with respect to a provincial corporation as if it were a corporation within the meaning of that Act, and a reference in that Part to a

section in that Act, other than to a

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

section in this Act that deals with the same subject-matter. Non-par value shares 54(1) Shares of a provincial corporation shall be in registered form and shall be without nominal or par value.

(2) Shares with a nominal or par value of a provincial corporation incorporated before the coming into force of this

section are, for the purposes of subsection (1), deemed to be shares without nominal or par value. Classes of shares 55(1) A provincial corporation shall have a class of shares designated as “common shares”.

(2) The rights of the holders of common shares are equal in all respects and include (

a) the right to vote at all meetings of shareholders, (

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

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

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

a) the rights, privileges, restrictions and conditions attaching to the shares of each class shall be set out in the instrument of incorporation, and (

b) those shares shall not be designated as common shares or by any similar term. 47

(4) Subject to

section 58, if a provincial corporation has more than one class of shares the rights of the holders of the shares of a class are equal in all respects. Issue of shares 56(1) Subject to this Act and the instrument of incorporation, shares of a provincial corporation may be issued at the times, to the persons and for the consideration determined by the directors.

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

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

(4) The requirement in subsection (3) that the consideration be in money does not apply (

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

b) in any other circumstances with respect to which the Minister has given his prior approval. Stated capital account 57(1) A provincial corporation shall maintain a separate stated capital account for each class and series of shares it issues.

(2) Unless the Minister approves otherwise, a provincial corporation shall add to the appropriate stated capital account in respect of any shares it issues the full amount of the consideration it receives for the shares.

(3) On the issue of a share, a provincial corporation shall not add to a stated capital account in 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 stated capital account it maintains in respect of a class or series of shares and (

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

b) the corporation has issued outstanding shares of more than one class or series, 48

the addition to the stated capital account must be approved by special resolution unless all the issued and outstanding shares are shares of not more than 2 classes of convertible shares referred to in

section 68(5).

(5) Where, in the case of a proposed addition of an amount to a stated capital account in a situation where a special resolution is required 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 the corporation would be affected by such action, the holders of shares of the differently affected class or series are entitled 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 otherwise carry the right to vote.

(6) Subject to subsections (4) and (5), a provincial corporation may add to a stated capital account any amount it has credited to a retained earnings or other surplus account

(7) On the day this

section comes into force, the stated capital of each class and series of shares of a provincial trust corporation is deemed to equal the paid-up capital of each class and series of shares of the body corporate immediately prior to that day. Shares in series 58(1) Subject to its instrument of incorporation, the directors of a provincial corporation may authorize the 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 determine the designation, rights, privileges, restrictions and conditions attaching to the shares of each series.

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

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

section shall confer on shares of a series (

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

b) a priority in respect of dividends or return of capital over shares of any other series in the same class that are then outstanding. 49

(4) Subsection (3) does not apply to a right or privilege to exchange a share or shares for, or to convert a share or shares into, a share or shares of another class. 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 first been offered to the shareholders holding shares of that class, and those shareholders have a pre-emptive right to acquire the offered shares in proportion to their holdings of the shares of that class, at the same price and on the same terms as those shares are to be offered to others.

(2) Notwithstanding 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 privileges, options or rights previously granted by the provincial corporation. Conversion privileges, options and rights 60(1) A provincial corporation may issue certificates, warrants or other evidences of conversion privileges or options or rights to acquire 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 attached.

(2) Conversion privileges and options or rights to purchase securities of a provincial corporation may be made transferable or non-transferable, and options and rights to purchase may be made separable or inseparable from any securities to which they are attached.

(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 acquire shares, the corporation shall reserve and continue to reserve sufficient authorized shares to meet the exercise of those conversion privileges, options and rights. 50

Prohibited shareholdings 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 except in 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 in contravention of subsection (1) immediately before December 8, 1988.

(3) A provincial corporation may in the capacity of personal representative hold shares in itself or in its holding body corporate unless it or the 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 transaction entered into by it in the ordinary course of its business.

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

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

b) has complied with

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

section 99 of this Act. Restrictions on acquisition of shares 62(1) Subject to this section,

section 77 applies to a purchase, acquisition or redemption for cancellation of voting shares by a provincial corporation under

section 63, 64 or 65 as if the purchase, acquisition or redemption of voting shares were a transfer or issue of voting shares.

(2) Notwithstanding 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 51

in the case of a purchase, acquisition or redemption of shares referred to in subsection (1). Acquisition of own shares 63(1) Subject to subsection (2) and to its by-laws, a provincial corporation may purchase or otherwise acquire shares issued by it.

(2) A provincial corporation shall not make any payment to purchase or otherwise acquire shares issued by it if there are reasonable grounds for believing that (

a) the corporation is, or after the payment would be, unable to pay its liabilities 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 liabilities and stated capital of all classes.

(3) A provincial corporation that is not a reporting issuer shall, within 30 days of the purchase of any of its issued shares, notify its shareholders (

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

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

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

d) of the balance, if any, remaining due to the shareholders from whom it purchased the shares.

(4) A shareholder of a provincial corporation other than a reporting issuer is entitled on request and without charge to a copy of the agreement between the corporation and any of its other shareholders under which the corporation has agreed to purchase, or has purchased, any of its own shares. Alternative acquisition of own shares 64(1) Subject to subsection (2) and to its by-laws, a provincial corporation may purchase or otherwise acquire shares issued by it (

a) to settle 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 52

purchase shares owned by a director, officer or employee of the corporation.

(2) Notwithstanding

section 63(2), a corporation may purchase 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 acquire under subsection (1) shares issued by it if there are reasonable grounds for believing that (

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

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

i) its liabilities, 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 purchased or acquired, or (

c) the purchase or acquisition would cause the corporation to be in contravention of this Act or the regulations. Redemption of shares 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 stated in the by-laws.

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

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

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

i) its liabilities, and (ii) the amount that would be required to pay the holders of shares who have a right to be paid, 53

on a redemption or in a liquidation, ratably with or prior to the holders of the shares to be purchased or redeemed, or (

c) the redemption would cause the corporation to be in contravention of this Act or the regulations. Donated and escrowed shares 66 A provincial corporation may accept from any shareholder a share of the corporation (

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

b) that has been held in escrow pursuant to an escrow agreement required by the Chief of Securities Administration and that is surrendered pursuant to that agreement. Reduction of stated capital 67(1) Subject to subsection (3) and its instrument of incorporation, a provincial corporation, by special resolution and with the approval of the Minister, may reduce its stated capital for any purpose.

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

(3) A special resolution under this

section shall specify the stated capital account or accounts from which the reduction of stated capital affected by the special resolution will be made.

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

a) the corporation is, or after the reduction would be unable to pay its liabilities as they become due, 54

(

b) the realizable value of the corporation’s assets after the reduction would be less than the aggregate of its liabilities, or (

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

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

a) to pay to the corporation an amount equal to any liability of that other shareholder that was extinguished or reduced contrary to this section, or (

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

(6) A proceeding to enforce a liability imposed by this

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

(7) This

section does not affect any liability that arises under

section 131. Adjustment of stated capital account 68(1) On a purchase, redemption or other acquisition by a provincial 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 stated capital account maintained for the class or series of shares of which the shares purchased, redeemed or otherwise acquired form a part, an amount equal to the result obtained by multiplying the stated capital of the shares of that class or series by the number of shares or fractions of shares of that class or series purchased, redeemed or otherwise acquired, divided by the number of issued shares of that class or series immediately before the purchase, 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 stated capital account maintained for the class or series of shares in respect of which the payment was made.

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

section 67(3). 55

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

a) deduct from the stated capital account maintained for the class or series of shares converted or changed an amount equal to the result obtained by multiplying the stated capital of the shares of that class or series by the number of shares of that 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 stated capital 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 attached to each class or series a right to convert a share of one class or series into a share of the other class or series, the amount of stated capital attributable to a share in either class or series is the amount obtained when the sum of the stated capital of both classes or series of shares is divided by the number of issued shares of both classes or series of shares immediately before the conversion.

(6) Shares or fractions of shares issued by a provincial corporation and purchased, redeemed or otherwise acquired by it shall be cancelled or restored to the status 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 acquired those shares.

(8) Where shares of a class or series are converted or changed into the same or another number of shares of another class or series, those shares become the same in all respects as the shares of the class or series into which they are converted or changed. Repayment, acquisition and reissue of debt obligations 69(1) Debt obligations issued, pledged, hypothecated or deposited by a provincial corporation are not redeemed by reason only that the indebtedness evidenced by the debt obligations or in respect of which the debt obligations are issued, pledged, hypothecated or 56

deposited is repaid, and those obligations remain obligations of the corporation until they are discharged.

(2) Debt obligations issued by a provincial corporation and purchased, redeemed or otherwise acquired by it may be cancelled or, subject to any applicable trust indenture or other agreement, may be reissued, pledged or hypothecated to secure any obligation of the corporation then existing or thereafter incurred, and any such acquisition and reissue, pledge or hypothecation is not a cancellation of the debt obligations. Enforceability of contract to purchase shares 70(1) A contract with a provincial corporation providing for the purchase by it of its own shares is specifically enforceable against the corporation, except to the extent that it cannot perform the contract without contravening

section 63 or 64.

(2) In any action brought on a contract referred to in subsection (1), the provincial corporation has the burden of proving that performance of the contract is prevented by

section 63 or 64.

(3) Until the provincial corporation has fully performed a contract referred to in subsection (1), the other party to the contract retains the status of a claimant and is entitled (

a) to be paid as soon as the corporation is lawfully able to perform the contract, or (

b) in a liquidation, to be ranked subordinate to the rights of depositors, creditors, holders of subordinated notes and any class of shareholders whose rights were in priority to the rights given to the class of shares he contracted to sell to the corporation, but in priority to the rights of other shareholders. Commission on sale of shares 71 The directors of a provincial corporation may authorize the corporation to pay a reasonable commission to any person in consideration of the person’s (

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

b) procuring or agreeing to procure purchasers for any such shares. Payment of dividend 72(1) The directors of a provincial corporation may declare, and a provincial corporation may pay, a dividend by issuing fully paid 57

shares of the 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 shall add to the stated capital account for the shares of the class or series issued the declared amount of the dividend, stated as an amount of money.

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

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

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

i) its liabilities, and (ii) its stated capital of all classes, or (

c) the payment would cause the corporation to be in contravention of this Act or the regulations. Lien on share73(1) The by-laws of a provincial corporation may provide that the corporation has a lien on a share registered in the name of a shareholder or the shareholder’s personal representative for a debt of that shareholder to the corporation.

(2) A provincial corporation may enforce a lien referred to in subsection (1) in accordance with its by-laws. Limited liability of shareholders 74 Except as otherwise provided in this Act, the shareholders of a provincial corporation are not, as shareholders, liable for any liability, act or default of the corporation. Restrictions on issue, transfer 75 A provincial corporation shall not impose restrictions on the issue, transfer or ownership of shares of any class or series except to the extent that it is authorized to do so by its instrument of incorporation or this Act.

Interpretation76(1) For the purposes of this

section and sections 77 to 81, a person is deemed to be related to 58

(

a) every body corporate the person controls and every affiliate of such a body corporate, (

b) every partner of the person, (

c) every trust or estate in which the person has a substantial beneficial interest or in respect of which the person serves as trustee or in a similar capacity, (

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 the Minister considers is acting in concert with the person to acquire and control 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) controls a body corporate that does not control a provincial corporation but that holds or beneficially owns 10% or more of the total number of issued and outstanding voting shares of a class of voting shares of the corporation, or (

b) holds or beneficially owns 10% or more of the total number of issued and outstanding voting shares of a class of voting shares of a body corporate that controls a provincial corporation is deemed to be a holding body corporate, and the voting shares and transfer or issue of voting shares of those persons in the body corporate referred to in clause (

a) or (

b) are deemed to be shares or a transfer or issue of shares to which sections 77, 78 and 80 apply. Minister's consent to transfer or issue 77(1) The directors of a provincial corporation shall refuse to allow the transfer or issue of voting shares of the corporation to be entered in the securities register without the Minister’s consent in either of the following circumstances: (

a) if, in a case where a person and other persons related to that person hold or beneficially own immediately before the entry of the transfer or issue more than 10% of any class of the issued and outstanding voting shares of the 59

corporation, the entry of the transfer or issue would cause that percentage to increase, based on the number of issued and outstanding voting shares after the entry of the transfer or issue; (

b) if, in a case where a person and other persons related to that person hold or beneficially own immediately before the entry of the transfer or issue 10% or less of any class of the issued and outstanding voting shares of the corporation, the entry of the transfer or issue would cause that percentage to increase to more than 10%, based on the number of issued and outstanding voting shares after the entry of the transfer or issue.

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

(3) Notwithstanding subsection (1), where a consent is given under subsection (1) with respect to a person and other persons related to that person, no consent under subsection (1) is required with respect to those persons in respect of a subsequent transfer or issue of voting shares unless, as a result of the entry of the transfer or issue, the shareholdings or beneficial ownership of those persons calculated under subsection (1) would undergo an increase of more than 5% from the shareholdings or beneficial ownership calculated immediately after the previous consent was given.

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

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

b) where, since the previous consent was given under this section, the shareholdings or beneficial ownership of the person and other persons related to that person calculated under subsection (1) have decreased by more than 5% from the shareholdings or beneficial ownership calculated immediately after the previous consent was given.

(5) Where, on the date on which this

section comes into force, a person and other persons related to that person hold or beneficially own more than 10% of any class of issued and outstanding voting shares of a corporation, the Minister is, for the purposes of this section, deemed to have given a consent in respect of that holding or ownership on the date this

section comes into force. 60

(6) The consent of the Minister under this

section is not required in respect of a transfer or issue of shares to an underwriter, as defined in the Securities Act, who receives them in that capacity.

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

a) the person to whom the shares are to be transferred or issued, or (

b) where the person referred to in clause (

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

(8) On an application under subsection (7), the 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 the Securities Act or comparable legislation of another jurisdiction in Canada, (iii) is or has been subject to a cease trading order under the Securities Act or comparable legislation of another jurisdiction in Canada, (iv) is the subject of a special examination under

section 273, (

v) is contravening any provision of this Act or the regulations or of any comparable legislation of another jurisdiction or of any undertaking given to the Minister, or (vi) fails to provide the information requested under subsection (7), or (

b) it would, in his opinion, be in the public interest to do so, having regard to the following: 61

(

i) the nature and sufficiency of the financial resources of the holders or beneficial owners to whom the consent relates as a source of continuing financial support for the provincial corporation; (ii) where the transfer or issue would result in a change in control of the provincial corporation, the soundness and feasibility of plans of the holders or beneficial owners to whom the consent relates for the future conduct and development of the business of the provincial corporation; (iii) the business record and experience of the holders or beneficial owners to whom the consent relates; (iv) whether the provincial corporation will 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 in Alberta.

(9) The consent of the Minister under this

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

a) information concerning the ownership or beneficial ownership of the 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 the shareholder and any person for whose use or benefit the share is held are ordinarily resident; (

d) information concerning the ownership or beneficial ownership of the shares of a holding body corporate; 62

(

e) information concerning any other matters specified by the Minister.

(2) The directors of a provincial corporation that is the subject of a direction under subsection (1) shall ensure that the corporation forthwith complies with the direction.

(3) A provincial corporation that is the subject of a direction under subsection (1) may request a person who has possession of or access to the information required to provide a declaration containing the information to the Minister, and that person shall forthwith comply with the request. Exemption79(1) The Minister may by order exempt any provincial corporation or other person from the application of

section 77 or 78 in 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). By-laws re shareholder information 80(1) The directors of a provincial corporation may make by-laws (

a) requiring any person holding any voting share of the corporation to submit written declarations (

i) with respect to the ownership and beneficial ownership of a share of the corporation or of a holding body corporate, (ii) with respect to the place in which the shareholder and any person for whose use or benefit the share is held are ordinarily resident, (iii) as to whether the shareholder is related to other persons, and (iv) with respect to any other matters the directors consider relevant for the purposes of sections 76 to 79, (

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

a) are to be submitted, and (

c) requiring any person desiring to have a transfer of a share to him entered in the securities register of the 63

corporation to submit a declaration referred to in clause (

a) as if he were a shareholder.

(2) Where under any by-law made under subsection (1) a declaration is required to be submitted by any shareholder or person in respect of the transfer of any share, the directors may refuse to allow the entry of the transfer of the share in the securities register of the provincial corporation until the required declaration has been submitted. Reliance on information 81 A director of a provincial corporation and any other person acting as proxy for a shareholder of the corporation may rely on a statement made in a declaration made pursuant to a by-law under

section 80(1) and on their own knowledge of the circumstances for the purposes of determining (

a) the residence of a person, (

b) who controls a body corporate, or (

c) any other circumstances relevant to the performance of their duties under sections 76 to 79, and the director or other person is not liable in any action for anything done or omitted by him in good faith in reliance on that statement or that knowledge. Place of annual meeting 82(1) Subject to the by-laws, a meeting of shareholders of a provincial corporation shall be held at any place in Canada that the directors determine, or in the absence of such a determination, at its principal place of business.

(2) Notwithstanding subsection (1), a meeting of shareholders of a provincial corporation may be held outside Canada if all the shareholders entitled 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 the shareholder attends the meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully held. Calling meetings 83(1) The directors of a provincial corporation shall call annual meetings of shareholders in accordance with this section.

(2) In the case of a provincial corporation incorporated under

Part 2, the directors shall, after the meeting called pursuant to

section 22, call an annual meeting, to be held not later than 4 months after 64

the end of the first fiscal year of the corporation, and subsequently not later than 4 months after the end of each fiscal year.

(3) In the case of a provincial corporation that is continued under

section 327, the directors shall call an annual meeting not later than 4 months after the end of the fiscal year in which letters patent of continuance are issued, and subsequently not later than 4 months after the end of each fiscal year.

(4) In the case of an amalgamated provincial corporation, the directors shall call an annual meeting not later than 4 months after the date set out in the supplementary letters patent of amalgamation, and subsequently not later than 4 months after the end of each fiscal year.

(5) A provincial corporation may apply to the Court for an order extending the time within which the first or the next annual meeting of the corporation shall be held.

(6) Notice of any application under subsection (5) by a provincial corporation that is a reporting issuer shall be filed with the Chief of Securities Administration.

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

(8) The directors of a provincial corporation may call a special meeting of shareholders at any time. Record dates 84(1) For the purpose 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 meeting, the directors may fix in advance a date as the record date for that determination of shareholders, but the record date shall not precede by more than 50 days the date of the particular action to be taken.

(2) For the purpose of determining shareholders entitled to receive notice of or to vote at a meeting of shareholders, the directors may fix in advance a date as the record date for that determination of 65

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 entitled to receive notice of or to vote at a meeting of shareholders shall be (

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

b) the record date for the determination of shareholders for any purpose other than to establish a shareholder’s right to receive notice of a meeting or to vote shall be at the close of business on the day on which the directors pass the resolution relating to that purpose.

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

a) by advertisement in a newspaper published or distributed in the locality where the corporation has its principal place of business and in each place in Canada where it has a transfer agent or where a transfer 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 listed for trading. Notice of meeting 85(1) Notice of the time and place of a meeting of shareholders of a provincial corporation shall be sent not less than 21 days and not more than 50 days before the meeting (

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

b) to each director, and 66

(

c) to the auditor of the corporation.

(2) Notwithstanding

section 320(2), a notice of a meeting of shareholders sent by mail to a shareholder, director or auditor in 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 required 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 adjourned by one or more adjournments for an aggregate of less than 30 days, it is not necessary, unless the by-laws otherwise provide, to give notice of the adjourned meeting other than by announcement at the time of an adjournment

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

(6) All business transacted at a special meeting of shareholders and all business transacted at an annual meeting of shareholders, except consideration of the financial statements and auditor’s report, fixing the number of directors for the following year, election of directors and reappointment of the incumbent auditor, are deemed to be special business.

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

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

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

(8) The text of a special resolution may be amended at a meeting of shareholders if the amendments correct manifest errors or are not material.

(9) A shareholder and any other person entitled to attend a meeting of shareholders of a provincial corporation may in any 67

manner waive notice of a meeting of shareholders, and attendance of any such person at a meeting of shareholders is a waiver of notice of the meeting, except where he attends the meeting for the express purpose of objecting to the tra

Document details

Collection	Alberta — Bills
Citation	L22 S3 2582
Type	bill
Volume / chapter	L22 S3 2582
Language	en
Format	json
Source	PROVINCIAL
Identifier	436fb03d4c465a2df750c54a8d3fec63af240a10

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