1972 Bill 23 First Session, 17th Legislature, 21 Elizabeth II THE LEGISLATIVE ASSEMBLY OF ALBERTA BILL 23 The Companies Amendment Act, 1972 MR. JAMISON First Reading .............................. . Second Reading ......................... . Third Reading ........................... . Printed by L. S. Wall, Queen's Printer. Edmlonton

BILL 23 1972 THE COMPANIES AMENDMENT ACT, 1972 ( Assented to ,1972) HER MAJESTY, by and with the advice and consent of the Legis'lative Assembly of A1berta, ffillacts as foHows: 1. The Companies Act is hereby amended.

Section 70 is amended by adding the following sub­

section after subsection (2):

(2.1) Where shares have been redeemed under this sec­ tion, notice thereof shall be given to the Registrar by the company within 30 days of the redemption date and every company which fails to give notice as required by this sub­

section is guilty of an offence.

Section 93, subsection (1) is amended by inserting after the words "Every prospectus" the words ", other than a preliminary prospectus,".

Section 97, subsection (1) is amended by striking out the words "within 60 days after the date of its creation (or within 90 days, if created outside the Province), " and by substituting the words "within 60 days after the date the instrument is fully executed,".

Explanatory Notes I. This Bill will amend ,chapter 60 of the Revised Statutes of Alberta 1970. 2. This amendment provides that the Registrar must be notified when redeemable shares are in fact redeemed. 3. This amendment is to clarify that it is a final prospectus which must be filed.

Section 93 (1) presently reads: 93.

(1) Every prospectus issued by or on behalf of a company shall be filed with the Registrar (

a) within 15 days of the date upon which the prospectus is acoepted by the Commission pursuant to The SecurHies Act, or by the equivalent authority in another jurisdiction, or (

b) where the prospectus is not required to be filed with the Com­ mission or with an equivalent authority in another jurisdiction, within 15 days of the date .of issue .of the prospectus. 4. This amendment is to make the time for registration of mort­ gages, etc. start to run from the date of execution ins,tead of the date of creation.

Section 97 (1) presentlly reads: 97.

(1) Eve,ry mortgage of its property created by a company, and every mortgage of its property situate in the Province created by an extra-provincial company, (

a) for the purpos,e of se,curing any debenture, or (

b) on uncalled or unpaid share capita,l, or (

c) as a floating charge on its undertaking or pl'loperty, or (

d) as a mortgage or charge on goodwill, on any patent, or licence under a patent, on any trade mark or on any copyright .or licence under a copyright, shall be registered by filing the instrument (or a true C.oPy thereof) by Which the mortgage is created or evidenced with the Registrar within 60 days after the date of its creation (or witp-in 90 days, if created out­ Side the Pr.ovince), otherwis,e the mortgage is, S.o far as any security on the c.ompany's property or undertaking is thereby conferred, void against the liquidator, and any assignee, receiver, and creditor of the company, and any subsequent bona Hde purchaser or mOl'tgagee for valu­ able oonsideration, but without prejudice to anyc.ontract or .obligation for repaym.ent of the. money thereby secured, and when a mortgage beoomes v,o'ld under thIS se'ctlOn the money secured thereby immediately beoomes payable.

Section 106, subsection (1) is amended by striking out the words "in the prescribed form". 6.

(1) Section 146 is amended by renumbering subsec­ tion (1) as subsection (1.1) and by adding prior thereto the following subsection: 146.

(1) In this

section "anniversary month" means the month in each year which is the same as the month in which the certificate of incorporation of the company was issued or, in the case of an amalgamated company, the month in which its -certificate of amalgamation was issued.

(2) Section 146, renumbered subsection (1.1), is amended (

a) by striking out the words "before January 31 in each year," and by substituting the words "each year before the last day of the month immediately following its anniversary month,", (

b) as to clause (

a) by striking out the words "on December 31 in the immediately preceding year" and by substituting the words "on the last day of its anniversary month in each year", and (

c) as to clause (

g) by striking out th~ words "at the date of the return" and by substituting the words "as of the last day of the company's anniversary month in each year".

(3) Section 146, subsection (2) is amended (

a) by striking out the words "before January 31 in each year," and by substituting the words "each year before the last day of the month immediately following its anniversary month,", (

b) as to clause (

a) by striking out the words "on De­ cember 31 in the immediately preceding year" and by substituting th~ words "on the last day of its anniversary month in each year", and (

c) as to clause (

e) by striking out the words "at the date of the return" and by substituUng the words "as of the last day of the company's anniversary month in each year".

(4) Section 146 is amended by adding after subsection (4) the following subsection:

(4.1) All returns made under subsection (1.1) or (2) shall be dated and shall be signed by an officer or director of the company on whose behalf the return is made. 2

Section 106 (1) reads: 106.

(1) Every receiver o'r mana.ger Qof the propel"ty 'Of a company who ha.s been appointed undrer the powers ,contained in any instrument shall, within 'One month, or such longer period as the Registrar may allow, after the expiration of the peri'od of ,six months fDom the date of his appDintment, and aHer the expira;tion of eVlery subsequent period of six mDnths, and within one month after he cease,s to act as receiver or manager, file with the Registrar an abstract in the prescribed form shDwing his l'eceipts and his payments during that period of six months, or, where he cease.s tOo act as af'ore,said, during the p,eriod from the end 'of the period tOo which the last p'receding abstract related up tOo the date of his S'O ceasing, and showing the aggre'ga;te amount of his re­ ceipts and of hi.s payments during ruli preceding periods since his app'Ointment, and .shall also, on ceasing to act as receiver 'Or manager, file with the Registrar no,tice to that effe'ct and ,the Registrar shall enter ,the notice in the register 'Of mortgages and charges. 6.

Date for returns changed from a specified date to relate to the anniversary of the company's incorporation or amalgamation.

Section 146, subsections (1) and (2) read: 2 146.

(1) Every company having sha're capUal shall, bef,ore January 31 in each Y1ear, make a return to the Registrar containing (

a) un1ess the company irS a public co'mpany, a list of aUl persons who were members of the company on December 31 in the im­ mediately preceding year setting 'Out (

i) the full name and address of each member, (ii) the number and class 'Of share held by each member at the date Df the return, and (iii) the amount called up Qon each share up tOo the date ·of the return, (

b) the address of ,the registered office 'of the company, (

c) the amount of the authorized share capirtal ,of the company, the number and class of shares into which it is divided, and the number 'Of shave,s issued from the commencement rof the com­ pany up to the date 'Of the return, (

d) a

summary distinguishing between shares issued for cash and shares issued fully oOr partly paid-up otherwise than in c'ash, (

e) the total amount of share warrants issued and surrendel'ed respectively since the date Qof the last return 'Or in the case of the fil"st return .since the incorporation of the company, (

g) the full names and addresses and o,ccupa;tions 'Of the persons who at the dwte of the return are dil'e'ctor,s of the company, and (

h) the total amount of debt due from the company at the date of the return in respect of all mortgages that are registered or required to be registered with the Registra;r.

(2) Every company that does not have share 'capitaI shall, before January 31 in each year, make a return to rthe Registra,r containing (

a) a list of aU persons who were membel's o.f the company on December 31 in the immediately preceding year setting out the full name and add'ress of ,each member, (b) ,the addre,ss of the registered office of the company, (

c) the total amount ofcapUal .contributed up to the date ,o,f the return, (

d) the total am'Ount guaranteed, (

e) the full names, address,es and occupaHons of the persons who 'at the date of the return are directol's of ,the ,company, and (

f) the total amount of debt due fl'om the company in respe,ct of all mortgages that are regist,ered 'or requir,ed to be registered with the Registrar.

Section 160 is struck out and the following

section is substituted: 160.

(1) Upon an application by the shareholders of a company holding shares representing not less than one­ tenth of the issued capital of the company, or upon an application of at least one-tenth of the members of a com­ pany without share capital, the court may appoint an inspector to investigate the affairs and management of the company or may appoint a person to audit ,its books.

(2) The application shall be supported by such evidence as the court requires for the purpose of showing that the applicants have good reason for requiring the investigation or audit, as the case may be.

(3) The court may require the applicants to give security to cover the probable cost of the investigation or audit and may n1ake rules and prescribe the manner in which and the extent to which the investigation or audit is to be conducted.

(4) The inspector or auditor shall report thereon to the court and the expense of the investigation shall, in the dis­ cretion of the court, be defrayed by the company or by the applicants or partly by the company and partly by the applicants.

(5) A company may, by resolution passed at an annual rl1eeting or at a general meeting called for that purpose, appoint an inspector to investigate its affairs and manage­ ment.

(6) The inspector appointed under subsection (5) has the same powers and shall perform the same duties as an inspector appointed under subsection (1) and he shall make his report in such manner and to such persons as the com­ pany by resolution directs.

(7) All officers and agents of the company shall pro­ duce for the examination of any inspector or auditor ap­ pointed under this

section all books and records in their custody or power.

(8) Any such inspector or auditor may examine upon oath the offieers, agents and employees of the company in relation to its affairs and management.

(9) Every officer or agent who refuses to produce any book or record referred to in subsection (7) and every person so examined who refuses to answer any question relating to the affairs and management of the company is guilty of an offence and on

summary conviction is liable to a fine of not more than $200.

(10) A copy of the report of the inspector or auditor as the case may be, authenticated by the court or under 'the seal. of th~ comp~ny w~o~e a~fairs and management he has InvestIgated, IS admIssIble In any legal proceedings as evidence of the opinion of the inspector or auditor in re­ lation to any matter contained in the report. 3

7. Ap.pointment of inspectors.

Section 160 presently reads: 160.

(1) The Lieutenant Governor in Council may, (

a) in the case of a company having a share capitaJl, on the ap­ plication of members holding not le,gs than one-twentieth of the .ghar,es issued, or (

b) in the case of a company not having a share oapital, on the ap­ plication 'Of not less than one-fifth in number 'Of the persons on the company's register 'Of members, appoint one or more compe,tent inspectors to investigate the affairs of the company and to report thereon in such manner as the Lieutenant Governo·r in C'Ouncil directs.

(2) The application shal,l be supported by such evidence as the Lieutenant Governor <in Coundl may require for the purpose of showing that the applicants have good reason fQr, and are not actuated by malicious motives in requiring, the investigation, and the Lieutenant Governor in Oouncil may, befQre appointing an inspectQr, require the applicants to give security for payment of the costs of the inquiry.

(3) Every director, manager, oofficer, and agent 'Of the CQmpany shall produce to the inspectors all books and documents in his custQdy 'Or power.

(4) An inspector may examine on oath any director, manager, officer, or agent of the company in relatiQn t,o its business, and may administer an 'Oath accQrdingly.

(5) If any director, manager, .officer 'Or agent 0'f the company re­ fuses to produce tQ the inspectors any book 0'r document that it is his duty under this sectiQn so to produce, ·or refuses to answer any question that is put to him by the inspectors with respect to the affairs 'Of the company, the inspectors may certify the refusal under their hand to the court, and the court may ,thereupon inquire into the case, and afterr hearing any witnesses who may be pl'oduced against or 'On behalf 'Of the alleged offender and after hearing any statement which may be 'Offered in defence, punish the 'Offender in like manner as if he had been guilty of contempt of the court

(6) On the conclusion 'Of the investigation the inspeoCtors shall report their 'OpiniQn t'O the Lieutenant G'Overnor in Council, and oopies 'Of the report shall be forwarded by the Minister to the registered 'Office of the company and tQ the Registrar, and a further CQPy shall, at the request 'Of the applicants f'Or the inv,estigation, be delivered to them.

(7) The report shall be written ,or printed, as the Lieutenant GQver­ nor in C'Ounci'l may direct.

(8) The Lieutenant GovernQr in Council may make· such orders as to the ,costs and exp,enses incidental tQ the investigation as are deemed proper.

(9) Where ,the affairs of a CQmpany are being investigated under this sectiQn or

section 161, a person whG has, within the tW(} years pre­ ceding the appointment 'Of an insp,ectQr to investigate the affairs of the cQmpany, held the p.osii'Lon of director, manager, .officer or agent in the company shall be deemed to be a director, m~nager, 'Officer 'Or agent 'Of the company fQr the purposes of this sectiGn and secti'On 161. 3

Section 177, subsection (1) is amended by striking out the words ", verified by affidavit,".

Section 182 is amended by striking out the words "the corporation known as "The Governor and Company of Ad­ venturers of England trading into Hudson's Bay" or".

Section 188, subsection (1) is a1nended by striking out the word "registered".

Section 189, subsection (2) is amended (

a) by striking out clause (

a) and by substituting the following: (

a) notice of the application shall be given to the Registrar, (

b) by adding the. following clause after clause (b): (bl) upon receipt of the of~ice copy of the order the Registrar shall cause notice of the restoration of the company to the register to be published in the Alberta Gazette and the cost of the ad­ vertisement shaH be paid to the Registrar by the company,

Section 271 is amended by striking out the words "extraordinary resolution" wherever they appear and by substituting the words "special resolution". 4

8. The annual statement no longer must be verified by affidavit.

Section 182 reads: 182. This Part d'Oes not apply to the corporati'On known as "The Governor and Oompany of Adventurers 'Of England trading int'O Hud­ snn's Bay" or an extra-provincial company that 1S licensed as an insurer under The Alberta Insurance Act or an extra-provincial oompany that is registered as a trust eompany under The Trust Oompanie,s Aot. The Hudson's Bay Company is now a Canadian company under the Canada Corporations Act. 4

Section 188, subsection (1) reads: 188.

(1) Where a oompany 'Or an extra-provincial company has failed to file any return, noti-ce, 'Or dOoCument required to :be filed with the Registrar pursuant to this Ad or any former Oompanies Act or Ordin­ ance, for two consecutive y·ears after the return, notice, or document should have been so filed, or the Registrar has reasonable cause to believe that a oompany is not carrying on busIness 'Or in operation, or in the case of an extra-provincial company that it has ceased to carry 'On business in the Province, he shall send to the ·company by post a registered letter notifying it of its default or inquiring whether the company is carrying on bu.siness or in operation.

Notice by ordinary mail now sufficient. II. NOltice of application to restore company to register. IZ.

Section 271 reads: 271.

(1) When a company has been wound up and is about Ito be dissolved, the books and papers of the company and of the liquidator may be disposed of as follows, that is to say: (

a) in the case of a winding-up by the court, in such way as the court directs; (

b) in the case 'of a voluntary winding-up, in such way as the oompany by extraordinary resoluUon direets.

(2) After two years fl'om the dissolution of the c'Ompany, or such shorter period, not being less than one year, as may be fixed by the court or by ex.traordinary resolution under subse·cUon (1), neither the com­ pany nor any liquidabor nor any pers'On to whom ,the custody of the books and paper.s has been committed, has any responsibility by reason of the same not beIng {'orthcoming to any person claiming to be inter­ ested there·in.

13. The following

section is added after

section 286 and prior to the heading "DivDsion (2)-fees ll : 286.1 Where a document submitted for registration to the office of the Registrar (

a) is not in all respects legible, or (

b) is for any reason, in the opinion of the Registrar, not capable of being copied by microfilm, mech­ anical duplicating or other similar process, or (

c) is in any manner insufficient in the opinion of the Registrar for the purpose of registration, the Registrar may refuse to register the document. 14. The First Schedule, Table A is amended by striking out articles 49, 50 and 51 and by substituting the following: 49. The proxy appointing a nominee shall be in writing under the hand of the appointor or of his attorney duly authorized in writing, or, if the appointor is a corporation, either under the conlnlon seal or under the hand of an officer or attorney so authorized. 50.

The proxy appointing a nominee and the power of at­ torneyor other authority, if any, under which it is signed, or a notarially certified copy of that power or authority, shall be deposited with the company, or an agent thereof, within the period of time preceding any meeting or ad­ j ourned meeting fixed by the directors and not exceeding 48 hours, excluding Saturdays and holidays, and which is specified in the notice calling the meeting or in the infor­ mation circular relating thereto. 15. The First Schedule, Table A is amended by striking out

article 58 and by substituting the following: 58. The management and directors shall duly comply with the provisions of The Companies Act, or any statutory modification thereof for the time being in force, and in particular with the provisions in regard to the registration of mortgages and to keeping registers of directors and mem­ bers and to mailing of forms of proxy and information cir­ culars, and to filing with the Registrar an annual report, and copies of special and other resolutions, and of any change in the registered office or of directors. 16. The First Schedule, Table A,

article 85 is amended (

a) as to clause (

a) by striking out the word "expended" and by substituting the word "disbursed", and (

b) by inserting the word "and" at the end of clause (

c) and by adding the following clause after clause (c) : (

d) all other transactions affecting the financial position of the company. 5

13. Registrar may refuse to register documents which may not be readily reproduced. 14. This amendment brings the articles into conformity with sections 139 and 142 of the Act. It also remedies an ambiguity in the use of the word "proxy". Articles 49 and 50 read: 49. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorized in writing, or, if the appo,intor is a co,rporation, either under the common seal or under the hand of an officer or attorney so authorized.

No person shall act as a pr,oxy unless he is entitled on his own behalf to be present and vote at the meeting at which he acts as Pl'OXY, or he has been appointed to act at that meeting as proxy for a co'rpo,ration. 50.

The instrument appointing a proxy and the power of attorney or other authot'ity, if any, under which it is s~gned, or a notarially oel'Ufied copy of that power or authority, shall be deposited at the registered ioffice of the Company not less than 48 hours before the time for hold­ ing the meeting at which the person named in the instrument proposes to vote, and in default the instrument ,of proxy shall not be treated as valid. IS. Reference to filing ,returns of allotments of shares no longer required. Mailing of proxy forms and information circulars added and management included. 16. This amendment brings the

article into conformity with sec­ tion 119 (1) of the Act which reads: 119.

(1) Every oompany shall cause to be kept proper books of account and accounting records in respect of all financial and other transactions of the company and, without limiting the generality 'Of the foregoing, records of (

a) all sums of money received and disbursed by the oompany and the matters in respect of which receipt and ,disbursement take place, (

b) all sales and purchases by the company, (

c) all assets and liabilities 'Of the company, and (

d) all other transactions affecting the financial position 'Of the company. 5

17. The First Schedule, Table A,

article 86 is amended by striking out the words "think fit" and by substituting the words "determine by resolution". 18. The First Schedule, Table A is amended by striking out articles 88, 89 and 90 and by substituting the following: 88. Once at least in every year the directors shall lay be­ fore the company at its annual general meeting a financial statement for the period since the preceding statement, or, in the case of the first financial statement, since the in­ corporation of the company, made up to a date not more than six months before the meeting. 89.

The financial statement shall be accompanied by the report of the auditors and by a report of the directors as to the state of the company's affairs, and the amount which they recommend to be paid by way of dividend, and the amount, if any, which they propose to earry to a reserve fund. 90. A copy 'Of the financial statement and report shall, not less than 10 days before the meeting, be sent to all persons entitled to receive notices of general meetings in the manner in which notices are to be given hereunder. 19.

(1) This Act, except

section 6, comes into force on the day upon which it is assented to.

(2) Section 6 comes into force on July 1, 1972. 6

17. This amendment brings the

article into conformity with sec­ tion 119 (5) of the Act.

Article 86 reads: 86. The books iQof account shall be kept at the registered office Qf the Company, or a,t such other plac,e as the directors think fit, and shall always be open to inspe,ction 'by the directors. 18. These amendments !bring these articles into conformity with

Part 6, Division (7) of the Act. These articles read: 6 88. Once at least in every year the directors shall lay before the Com­ pany !lit its annual gene'ral meeting a profit and loss account for the period isince the preceding account or, in the case of the first account, since the incorporation .of the Com"pany, made up to a date not more than four months before such meeting. 89. A balance sheet shalll be made lOut in every year and laid before the Company at its annual general meeting made up to the same date as the profit and loss account.

The balance sheet shall be ac­ companied by the repol't of the auditors and by a report of the directors as to the ,state of the Company's affairs, and ,the amount which they recommend to be paid by way of dividend, and the amount, if any, which they propose t,o carry to a reserve fund. 90. A copy of the balance sheet and report shall, not less than seven days before the meeting, be sent to 3.)11 persons entitled to receive notices of general meetings in the manner .in which notice's are toO be given hereunder. Title: 1972 (17th, 1st) Bill 23, The Companies Amendment Act, 1972