Articles of Incorporation - Template, Sample Form Pro · EN-CA-law

ARTICLES OF INCORPORATION

(Canada Business Corporations Act, R.S.C. 1985, c. C-44, s. 6 / applicable provincial business corporations statute)

Form 1

ARTICLE 1: CORPORATE NAME

The name of the Corporation is:

________ Limited

ARTICLE 2: PROVINCE OR TERRITORY OF REGISTERED OFFICE

The province or territory in Canada where the registered office of the Corporation is situated is:

________

The full address of the registered office is:

________

ARTICLE 3: CLASSES AND ANY MAXIMUM NUMBER OF SHARES THAT THE CORPORATION IS AUTHORIZED TO ISSUE

The Corporation is authorized to issue the classes of shares, in the numbers and with the rights, privileges, restrictions and conditions, set out in the attached Schedule "A" which forms part of these Articles.

ARTICLE 4: RESTRICTIONS, IF ANY, ON SHARE TRANSFERS

The restrictions, if any, on the transfer of shares of the Corporation are set out in the attached Schedule "B" which forms part of these Articles.

ARTICLE 5: NUMBER (OR MINIMUM AND MAXIMUM NUMBER) OF DIRECTORS

The Corporation shall have a board of directors consisting of a minimum of ________ and a maximum of ________ directors. The actual number of directors within that range shall be determined from time to time by ordinary resolution of the shareholders or, where so empowered, by the directors in accordance with applicable law.

ARTICLE 6: RESTRICTIONS, IF ANY, ON THE BUSINESS THE CORPORATION MAY CARRY ON

There are no restrictions on the business that the Corporation may carry on.

ARTICLE 7: OTHER PROVISIONS

a) The right to transfer shares of the Corporation is restricted in the manner set out in Schedule "B".

b) The number of shareholders of the Corporation, exclusive of persons who are in the employment of the Corporation and exclusive of persons who, having been formerly in the employment of the Corporation, were, while in that employment, and have continued after the termination of that employment to be, shareholders of the Corporation, is limited to not more than fifty (50) persons, two or more persons who are the joint registered owners of one or more shares being counted as one shareholder.

c) Any invitation to the public to subscribe for any securities of the Corporation is prohibited.

d) The directors may, between annual meetings of shareholders, appoint one or more additional directors of the Corporation to serve until the next annual meeting, provided that the number of additional directors so appointed shall not at any time exceed one-third of the number of directors who held office at the expiration of the last annual meeting of the Corporation, to the extent permitted by applicable law.

e) The board of directors may, without authorization of the shareholders, borrow money upon the credit of the Corporation and otherwise exercise the borrowing and security-granting powers of the Corporation, and may delegate such powers in accordance with applicable law.

ARTICLE 8: INCORPORATORS

The name(s), address(es) and signature(s) of the incorporator(s) are as follows:

Name: ________

Address: ________

Signature: ________

Date: ________

(Where required by the applicable statute, the names and addresses of the first directors may be set out in the accompanying Notice of Registered Office and Notice of Directors / Initial Registered Office and First Board of Directors filing.)

First director name: ________, a resident Canadian within the meaning of applicable law (where applicable), of:

________

Schedule "A"

Description of Classes of Shares / Description des cat\u00e9gories d'actions

I) Common Shares:

One class of Common Shares, in an unlimited number.

II) Special Shares:

Class A Special Shares, in an unlimited number.

Class B Special Shares, in an unlimited number.

Rights, Privileges, Restrictions and Conditions Attaching to Each Class of Shares

1. COMMON SHARES

The Common Shares shall carry and be subject to the following rights, privileges, restrictions and conditions:

1.1. VOTING RIGHTS

1.1.1) The holders of the Common Shares shall be entitled to one (1) vote per Common Share held.

1.1.2) The holders of Common Shares shall be entitled to receive notice of and to attend all meetings of the shareholders of the Corporation and to cast votes thereat, including, without limitation, meetings held for the purpose of electing directors of the Corporation.

1.1.3) The Common Shares are fully participating.

1.2. DIVIDENDS

1.2.1) The board of directors of the Corporation may declare and the Corporation may pay dividends in its discretion, subject to the solvency tests and other requirements of applicable law (or any consolidation, repeal, amendment to or substitution therefor).

1.2.2) Subject to the rights of any other class of shares ranking in priority, the board of directors may declare and pay dividends on any class of shares to the exclusion of the other classes, and may pay such dividends in such proportions as it may determine.

1.3. WINDING UP / DISSOLUTION

1.3.1) In the event of the liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, or any other distribution of the property and assets of the Corporation among its shareholders for the purpose of winding up its affairs, the holders of the Common Shares shall, subject to the rights, privileges, restrictions and conditions attaching to any other class of shares ranking in priority thereto, be entitled to receive the remaining property and assets of the Corporation on a pro-rata basis.

2. SPECIAL SHARES

The Class A Special Shares and the Class B Special Shares shall carry and be subject to the following rights, privileges, restrictions and conditions:

2.1. VOTING RIGHTS

2.1.1) The Special Shares are non-voting, non-cumulative dividend shares. The holders thereof shall not be entitled to receive notice of, to attend, or to vote at any meeting of the shareholders of the Corporation, except as specifically provided under applicable law.

2.2. DIVIDENDS

2.2.1) The board of directors of the Corporation may declare and the Corporation may pay dividends in its discretion, subject to the solvency tests and other requirements of applicable law (or any consolidation, repeal, amendment to or substitution therefor).

2.2.2) The Corporation may pay non-cumulative dividends on either class of the Special Shares at a rate per share per annum not to exceed fifteen percent (15%) of the amount equal to the amount recorded in the stated capital account maintained in respect of that class of Special Shares, divided by the total number of issued shares of that class.

2.2.3) The board of directors may, in its discretion, declare and pay dividends on any class of shares to the exclusion of the other classes.

2.3. REDEMPTION AT THE OPTION OF THE CORPORATION

2.3.1) The Corporation may, at the discretion of its board of directors, redeem at any time and from time to time all or any part of either class of the Special Shares, provided that the solvency tests and other requirements of applicable law (or any consolidation, repeal, amendment to or substitution therefor) have been satisfied.

2.3.2) The procedure for any such redemption, including the giving of notice, if any, shall be determined by the directors, acting reasonably.

2.3.3) Subject to the price adjustment clause set out below, the redemption price shall be the amount of consideration received by the Corporation for the issue of such shares (regardless of the manner of payment), together with all declared and unpaid dividends thereon. The redemption price per share shall be the fair market value of the consideration received, as determined by the board of directors, divided by the total number of issued shares of the applicable class of Special Shares (the "Redemption Amount").

2.3.4) If only part of the shares of a holder are redeemed and the Corporation maintains certificated securities, a new certificate shall be issued to the holder for the number of shares not redeemed. Where permitted by applicable law and the Corporation maintains uncertificated securities, a new notice setting out the rights and number of shares held shall be delivered to the holder.

2.3.5) From and after the date of redemption, the holder thereof shall cease to be entitled to dividends or to exercise any rights of a shareholder in respect of the redeemed shares, provided the Corporation has not defaulted in payment of the redemption price and subject to completion of the redemption.

2.4. RETRACTION AT THE OPTION OF THE HOLDER

2.4.1) The holder of either class of the Special Shares may, at any time and from time to time, require the Corporation to redeem all or any part of the Special Shares of that class held by the holder, provided that the solvency tests and other requirements of applicable law (or any consolidation, repeal, amendment to or substitution therefor) have been satisfied.

2.4.2) A holder exercising the right of retraction shall deliver a written notice to the Corporation specifying the number of shares to be redeemed and the date on which the redemption is to occur.

2.4.3) The retraction price shall be the Redemption Amount.

2.4.4) If only part of the shares of a holder are redeemed and the Corporation maintains certificated securities, a new certificate shall be issued to the holder for the number of shares not redeemed. Where permitted by applicable law and the Corporation maintains uncertificated securities, a new notice setting out the rights and number of shares held shall be delivered to the holder.

2.4.5) From and after the date of retraction, the holder thereof shall cease to be entitled to dividends or to exercise any rights of a shareholder in respect of the retracted shares, provided the Corporation has not defaulted in payment and subject to completion of the retraction.

2.5. PURCHASE FOR CANCELLATION

2.5.1) The Corporation may, at its option, at any time and from time to time, purchase for cancellation all or any part of the Special Shares, or any of them, provided that the solvency tests and other requirements of applicable law (or any consolidation, repeal, amendment to or substitution therefor) have been satisfied.

2.5.2) Such purchase may be made pursuant to tenders or, with the unanimous consent of the holders of all issued shares of the applicable class, by private contract or otherwise.

2.5.3) The purchase price shall be the lowest price at which, in the opinion of the directors, such shares are obtainable, plus all declared and unpaid dividends, but in no event shall it exceed the Redemption Amount.

2.5.4) If, in response to an invitation for tenders, shareholders submit tenders at the same price for more shares than the directors propose to purchase, then such tenders shall be accepted, if at all, on a pro-rata basis.

2.5.5) Upon any such purchase, the Corporation shall adjust the stated capital account maintained in respect of the applicable class of Special Shares in accordance with applicable law.

2.6. PRICE ADJUSTMENT CLAUSE

2.6.1) Where the Corporation (as transferee) issues shares to a subscribing transferor-shareholder, the consideration for which is property transferred by the subscribing transferor-shareholder (whether an individual, a trust or a corporation), the subscription price for such shares shall be the value agreed upon between the Corporation and the subscribing transferor-shareholder, determined in a fair and reasonable manner.

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2.6.3) Notwithstanding the foregoing, if such alternate determination by a taxing authority is the subject of an objection or appeal made by the Corporation and the subscribing transferor-shareholder, the final determination made upon such objection or appeal, after all rights of appeal have been exhausted, shall be final and binding.

2.6.4) The value so finally determined shall be substituted for the value originally determined, and the subscription price and the manner of payment shall be adjusted accordingly so that the stated capital account of the shares issued properly reflects the value of the property as so determined.

2.7. WINDING UP / DISSOLUTION

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2.7.2) The holders of either class of the Special Shares shall not be entitled to share in any further distribution of the property and assets of the Corporation.

2.7.3) The holders of the Common Shares shall be entitled to receive the remaining property and assets of the Corporation.

Schedule "B"

Restrictions on Share Transfers / Restrictions sur le transfert des actions

No share of any class of the Corporation shall be transferred without the express approval of the board of directors of the Corporation, to be evidenced by a resolution duly adopted by the directors, or, in the alternative, by the approval in writing of the holders of not less than a majority of the issued shares carrying voting rights of the Corporation; provided that this restriction shall be interpreted and applied so as to be consistent with the conditions required of a private issuer or non-distributing corporation under applicable corporate and securities law.