APPENDIX "H"
SECTION 191 OF THE ABCA
"191(1) Subject to sections 192 and 242, a holder of shares of any class of a corporation may dissent if the corporation resolves to
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| (a) | amend its articles under section 173 or 174 to add, change or remove any provisions restricting or constraining the issue or transfer of shares of that class, |
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| (b) | amend its articles under section 173 to add, change or remove any restrictions on the business or businesses that the corporation may carry on, |
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| (b.1) | amend its articles under section 173 to add or remove an express statement establishing the unlimited liability of shareholders as set out in section 15.2(1), |
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| (c) | amalgamate with another corporation, otherwise than under section 184 or 187, |
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| (d) | be continued under the laws of another jurisdiction under section 189, or |
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| (e) | sell, lease or exchange all or substantially all its property under section 190. |
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| (2) | A holder of shares of any class or series of shares entitled to vote under section 176, other than section 176(1)(a), may dissent if the corporation resolves to amend its articles in a manner described in that section. |
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| (3) | In addition to any other right the shareholder may have, but subject to subsection (20), a shareholder entitled to dissent under this section and who complies with this section is entitled to be paid by the corporation the fair value of the shares held by the shareholder in respect of which the shareholder dissents, determined as of the close of business on the last business day before the day on which the resolution from which the shareholder dissents was adopted. |
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| (4) | A dissenting shareholder may only claim under this section with respect to all the shares of a class held by the shareholder or on behalf of any one beneficial owner and registered in the name of the dissenting shareholder. |
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| (5) | A dissenting shareholder shall send to the corporation a written objection to a resolution referred to in subsection (1) or (2) |
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| (a) | at or before any meeting of shareholders at which the resolution is to be voted on, or |
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| (b) | if the corporation did not send notice to the shareholder of the purpose of the meeting or of the shareholder's right to dissent, within a reasonable time after the shareholder learns that the resolution was adopted and of the shareholder's right to dissent. |
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| (6) | An application may be made to the Court after the adoption of a resolution referred to in subsection (1) or (2), |
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| (a) | by the corporation, or |
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| (b) | by a shareholder if the shareholder has sent an objection to the corporation under subsection (5), |
to fix the fair value in accordance with subsection (3) of the shares of a shareholder who dissents under this section, or to fix the time at which a shareholder of an unlimited liability corporation who dissents under this section ceases to become liable for any new liability, act or default of the unlimited liability corporation.
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| (7) | If an application is made under subsection (6), the corporation shall, unless the Court otherwise orders, send to each dissenting shareholder a written offer to pay the shareholder an amount considered by the directors to be the fair value of the shares. |
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| (8) | Unless the Court otherwise orders, an offer referred to in subsection (7) shall be sent to each dissenting shareholder |
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| (a) | at least 10 days before the date on which the application is returnable, if the corporation is the applicant, or |
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| (b) | within 10 days after the corporation is served with a copy of the application, if a shareholder is the applicant. |
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| (9) | Every offer made under subsection (7) shall |
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| (a) | be made on the same terms, and |
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| (b) | contain or be accompanied with a statement showing how the fair value was determined. |
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| (10) | A dissenting shareholder may make an agreement with the corporation for the purchase of the shareholder's shares by the corporation, in the amount of the corporation's offer under subsection (7) or otherwise, at any time before the Court pronounces an order fixing the fair value of the shares. |
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| (11) | A dissenting shareholder |
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| (a) | is not required to give security for costs in respect of an application under subsection (6), and |
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| (b) | except in special circumstances must not be required to pay the costs of the application or appraisal. |
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| (12) | In connection with an application under subsection (6), the Court may give directions for |
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| (a) | joining as parties all dissenting shareholders whose shares have not been purchased by the corporation and for the representation of dissenting shareholders who, in the opinion of the Court, are in need of representation, |
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| (b) | the trial of issues and interlocutory matters, including pleadings and questioning under Part 5 of the Alberta Rules of Court, |
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| (c) | the payment to the shareholder of all or part of the sum offered by the corporation for the shares, |
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| (d) | the deposit of the share certificates with the Court or with the corporation or its transfer agent, |
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| (e) | the appointment and payment of independent appraisers, and the procedures to be followed by them, |
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| (f) | the service of documents, and |
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| (g) | the burden of proof on the parties. |
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| (13) | On an application under subsection (6), the Court shall make an order: |
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| (a) | fixing the fair value of the shares in accordance with subsection (3) of all dissenting shareholders who are parties to the application, |
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| (b) | giving judgment in that amount against the corporation and in favour of each of those dissenting shareholders, |
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| (c) | fixing the time within which the corporation must pay that amount to a shareholder, and |
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| (d) | fixing the time at which a dissenting shareholder of an unlimited liability corporation ceases to become liable for any new liability, act or default of the unlimited liability corporation. |
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| (a) | the action approved by the resolution from which the shareholder dissents becoming effective, |
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| (b) | the making of an agreement under subsection (10) between the corporation and the dissenting shareholder as to the payment to be made by the corporation for the shareholder's shares, whether by the acceptance of the corporation's offer under subsection (7) or otherwise, or |
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| (c) | the pronouncement of an order under subsection (13); |
whichever first occurs, the shareholder ceases to have any rights as a shareholder other than the right to be paid the fair value of the shareholder's shares in the amount agreed to between the corporation and the shareholder or in the amount of the judgment, as the case may be.
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| (15) | Subsection (14)(a) does not apply to a shareholder referred to in subsection (5)(b). |
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| (16) | Until one of the events mentioned in subsection (14) occurs, |
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| (a) | the shareholder may withdraw the shareholder's dissent, or |
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| (b) | the corporation may rescind the resolution, |
and in either event proceedings under this section shall be discontinued.
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| (17) | The Court may in its discretion allow a reasonable rate of interest on the amount payable to each dissenting shareholder, from the date on which the shareholder ceases to have any rights as a shareholder by reason of subsection (14) until the date of payment. |
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| (18) | If subsection (20) applies, the corporation shall, within 10 days after |
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| (a) | the pronouncement of an order under subsection (13), or |
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| (b) | the making of an agreement between the shareholder and the corporation as to the payment to be made for the shareholder's shares, |
notify each dissenting shareholder that it is unable lawfully to pay dissenting shareholders for their shares.
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| (19) | Notwithstanding that a judgment has been given in favour of a dissenting shareholder under subsection (13)(b), if subsection (20) applies, the dissenting shareholder, by written notice delivered to the corporation within 30 days after receiving the notice under subsection (18), may withdraw the shareholder's notice of objection, in which case the corporation is deemed to consent to the withdrawal and the shareholder is reinstated to the shareholder's full rights as a shareholder, failing which the shareholder retains a status as a claimant against the corporation, to be paid as soon as the corporation is lawfully able to do so or, in a liquidation, to be ranked subordinate to the rights of creditors of the corporation but in priority to its shareholders. |
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| (20) | A corporation shall not make a payment to a dissenting shareholder under this section if there are reasonable grounds for believing that |
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| (a) | the corporation is or would after the payment be unable to pay its liabilities as they become due, or |
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| (b) | the realizable value of the corporation's assets would by reason of the payment be less than the aggregate of its liabilities." |
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