BY-LAW NO.1
A By-Law relating generally to the transaction of the business and affairs of
PROFCO RESOURCES LTD.
CONTENTS
SECTION SUBJECT
One Interpretation
Two Business of the Corporation
Three Directors
Four Committees
Five Protection of Directors and Officers
Six Shares
Seven Dividends
Eight Meetings of Shareholders
Nine Notices
Ten Effective Date and Repeal
IT IS HEREBY ENACTED as By-law No. 1 of PROFCO RESOURCES LTD. (hereinafter
called the "Corporation") as follows:
SECTION ONE INTERPRETATION
1.01 DEFINITIONS
In the by-laws of the Corporation, unless the context otherwise requires:
"ACT" means the Business Corporations Act of Alberta, and any statute that may
be substituted therefor, as from time to time amended;
"APPOINT" includes "elect" and vice versa;
"ARTICLES" means the articles attached to the Certificate of Continuance of the
Corporation as from time to time amended or restated;
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"BOARD" means the board of directors of the Corporation;
"BY-LAWS" means this by-law and all other by-laws of the Corporation from time
to time in force and effect;
"MEETING OF SHAREHOLDERS" means any meeting of shareholders, including any
meeting of one or more classes or series of shareholders;
"RECORDED ADDRESS" means, in the case of a shareholder, his address as recorded
in the securities register; in the case of joint shareholders, the address
appearing in the securities register in respect of such joint holding or the
first address so appearing if there are more than one; and in the case of a
director, officer, auditor or member of a committee of the board, his latest
address as recorded in the records of the Corporation;
"SIGNING OFFICER" means, in relation to any instrument, any person authorized to
sign the same on behalf of the Corporation by Section 2.03 or by a resolution
passed pursuant thereto.
Save as aforesaid, words and expressions defined in the Act have the same
meanings when used herein; and words importing the singular number include the
plural and vice versa; words importing gender include the masculine, feminine
and neuter genders; and words importing persons include individuals, bodies
corporate, partnerships, trusts and unincorporated organizations.
1.02 CONFLICT WITH THE ACT, THE ARTICLES OR ANY UNANIMOUS SHAREHOLDER AGREEMENT
To the extent of any conflict between the provisions of the by-laws and the
provisions of the Act, the articles or any unanimous shareholder agreement
relating to the Corporation, the provisions of the Act, the articles or the
unanimous shareholder agreement shall govern.
1.03 HEADINGS AND SECTIONS
The headings used throughout the by-laws are inserted for convenience of
reference only and are not to be used as an aid in the interpretation of the
by-laws. "Section" followed by a number means or refers to the specified section
of this by-law.
1.04 INVALIDITY OF ANY PROVISION OF BY-LAWS
The invalidity or unenforceability of any provision of the by-laws shall not
affect the validity or enforceability of the remaining provisions of the
by-laws.
SECTION TWO BUSINESS OF THE CORPORATION
2.0 1 CORPORATE SEAL
The corporate seal of the Corporation, if any, shall be in such form as the
board may from time to time by resolution approve.
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2.02 FINANCIAL YEAR
The financial year of the Corporation shall end on such date in each year as the
board may from time to time by resolution determine.
2.03 EXECUTION OF INSTRUMENTS
Deeds, transfers, assignments, contracts, obligations, certificates and other
instruments may be signed on behalf of the Corporation by two persons, one of
whom holds the office of chairman of the board, president, vice-president or
director and the other of whom holds one of the said offices or the office of
secretary, treasurer, assistant secretary or assistant treasurer or any other
office created by by-law or by resolution of the board; provided that if the
Corporation only has one director, that director alone may sign any instruments
on behalf of the Corporation. In addition, the board may from time to time
direct the manner in which and the person or persons by whom any instrument or
instruments mayor shall be signed. Any signing officer may affix the corporate
seal to any instrument requiring the same.
2.04 BANKING ARRANGEMENTS
The banking business of the Corporation including, without limitation, the
borrowing of money and the giving of security therefor, shall be transacted with
such banks, trust companies or other bodies corporate or other persons as may
from time to time be authorized by the board. Such banking business or any part
thereof shall be transacted under such agreements, instructions and delegations
of powers as the board may from time to time prescribe or authorize.
2.05 VOTING RIGHTS IN OTHER BODIES CORPORATE
The signing officers may execute and deliver proxies and arrange for the
issuance of voting certificates or other evidence of the right to exercise the
voting rights attaching to any securities held by the Corporation. Such
instruments, certificates or other evidence shall be in favour of such person or
persons as may be determined by the persons executing such proxies or arranging
for the issuance of voting certificates or such other evidence of the right to
exercise such voting rights. In addition, the board or, failing the board, the
signing officers may from time to time direct the manner in which and the person
or persons by whom any particular voting rights or class of voting rights mayor
shall be exercised.
2.06 INSIDER TRADING REPORTS AND OTHER FILINGS
Anyone officer or director of the Corporation may execute and file on behalf of
the Corporation insider trading reports and other filings of any nature
whatsoever required under applicable corporate or securities laws.
2.07 DIVISIONS
The board may from time to time cause the business and operations of the
Corporation or any part thereof to be divided into one or more divisions upon
such basis, including without limitation, types of business or operations,
geographical territories, product lines or goods or services, as the board may
consider appropriate in each case. From time to time the board may authorize
upon such basis as may be considered appropriate in each case:
(a) the designation of any such division by, and the carrying on of the business
and operations of any such division under, a name other than the name of the
Corporation; provided that
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the Corporation shall set out its name in legible characters in all contracts,
invoices, negotiable instruments and orders for goods or services issued or made
by or on behalf of the Corporation; and
(b) the appointment of officers for any such division and the determination of
their powers and duties, provided that any such officers shall not, as such, be
officers of the Corporation.
SECTION THREE DIRECTORS
3.01 NUMBER OF DIRECTORS
If the articles provide for a maximum number and a minimum number of directors,
unless otherwise provided in the articles, the number of directors of the
Corporation shall be determined from time to time by ordinary resolution of the
shareholders or, in the absence of such resolution, by resolution of the
directors.
3.02 CALLING AND NOTICE OF MEETINGS
Meetings of the board shall be called and held at such time and at such place as
the board, the chairman of the board, the president or any two directors may
determine, and the secretary or any other officer shall give notice of meetings
when directed or authorized by such persons. Notice of each meeting of the board
shall be given to each director not less than forty-eight hours before the time
when the meeting is to be held, provided that, if a quorum of directors is
present, the board may without notice hold a meeting immediately following an
annual meeting of shareholders. Notice of a meeting of the board may be given
verbally, in writing or by telephone, telegraph, facsimile transmission or any
other means of communication. A notice of a meeting of directors need not
specify the purpose of or the business to be transacted at the meeting, except
where required by the Act. Notwithstanding the foregoing, the board may from
time to time fix a day or days in any month or months for regular meetings of
the board at a place and hour to be named, in which case, provided that a copy
of any such resolution is sent to each director forthwith after being passed and
forthwith after each director's appointment, no other notice shall be required
for any such regular meeting except where the Act requires specification of the
purpose or the business to be transacted thereat.
3.03 PLACE OF MEETINGS
Meetings of the board may be held at any place in or outside Alberta. A director
who attends a meeting of directors, in person or by telephone, is deemed to have
consented to the location of the meeting except when he 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.
3.04 MEETINGS BY TELEPHONE
With the consent of the chairman of the meeting or a majority of the directors
present at the meeting, a director may participate in a meeting of the board or
of a committee of the board by means of telephone or other communication
facilities that permit all persons participating in the meeting to hear each
other. A director participating in such a meeting in such manner shall be
considered present at the meeting and at the place of the meeting.
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3.05 QUORUM
The quorum for the transaction of business at any meeting of the board shall
consist of two directors or such greater or lesser number of directors as the
board may from time to time determine, provided that, if the board consists of
only one director, the quorum for the transaction of business at any meeting of
the board shall consist of one director.
3.06 CHAIRMAN
The chairman of any meeting of the board shall be the director present and
willing to so act at the meeting who is the first mentioned of the following
officers as have been appointed: chairman of the board, president or a
vice-president (in order of seniority). If no such officer is present and
willing to act, the directors present shall choose one of their numbers to be
chairman.
3.07 ACTION BY THE BOARD
At all meetings of the board every question shall be decided by a majority of
the votes cast on the question. In case of an equality of votes the chairman of
the meeting shall be entitled to a second or casting vote. The powers of the
board may be exercised by resolution passed at a meeting at which a quorum is
present or by resolution in writing signed by all the directors who would be
entitled to vote on that resolution at a meeting of the board. Resolutions in
writing may be signed in counterparts.
3.08 ADJOURNED MEETING
Any meeting of directors may be adjourned from time to time by the chairman of
the meeting, with the consent of the meeting, to a fixed time and place. The
adjourned meeting shall be duly constituted if a quorum is present and if it is
held in accordance with the terms of the adjournment. If there is no quorum
present at the adjourned meeting, the original meeting shall be deemed to have
terminated forthwith after its adjournment.
3.09 REMUNERATION AND EXPENSES
The directors shall be paid such remuneration for their services as the board
may from time to time determine. The directors shall also be entitled to be
reimbursed for reasonable travelling and other expenses properly incurred by
them in attending meetings of the board or any committee thereof. Nothing herein
contained shall preclude any director from serving the Corporation in any other
capacity and receiving remuneration therefor.
3.10 OFFICERS
The board from time to time may appoint one or more officers of the Corporation
and, without prejudice to rights under any employment contract, may remove any
officer of the Corporation. The powers and duties of each officer of the
Corporation shall be those determined from time to time by the board and, in the
absence of such determination, shall be those usually incidental to the office
held.
3.11 AGENTS AND ATTORNEYS
The board shall have the power from time to time to appoint agents or attorneys
for the Corporation in or outside Canada with such powers of management or
otherwise (including the power to sub-delegate) as may be thought fit.
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SECTION FOUR COMMITTEES
4.0 1 TRANSACTION OF BUSINESS
The powers of any committee of directors may be exercised by a meeting at which
a quorum is present or by resolution in writing signed by all the members of
such committee who would have been entitled to vote on that resolution at a
meeting of the committee. At all meetings of committees every question shall be
decided by a majority of the votes cast on the question. In case of an equality
of votes the chairman of the meeting shall be entitled to a second or casting
vote. Resolutions in writing may be signed in counterparts.
4.02 PROCEDURE
Unless otherwise determined by the board, a quorum for meetings of any committee
shall be a majority of its members, each committee shall have the power to
appoint its chairman and the rules for calling, holding, conducting and
adjourning meetings of the committee shall be the same as those governing the
board. Each member of a committee shall serve during the pleasure of the board
of directors and, in any event, only so long as he shall be a director. The
directors may fill vacancies in a committee by appointment from among their
members. Provided that a quorum is maintained, the committee may continue to
exercise its powers notwithstanding any vacancy among its members.
SECTION FIVE PROTECTION OF DIRECTORS AND OFFICERS
5.01 LIMITATION OF LIABILITY
No director or officer for the time being of the Corporation shall be liable for
the acts, receipts, neglects or defaults of any other director or officer or
employee, or for joining in any receipt or act for conformity, or for any loss,
damage or expense happening to the Corporation through the insufficiency or
deficiency of title to any property acquired by the Corporation or for or on
behalf of the Corporation or for the insufficiency or deficiency of any security
in or upon which any of the moneys of or belonging to the Corporation shall be
placed or invested, or for any loss or damage arising from the bankruptcy,
insolvency or tortious act of any person, firm or corporation including any
person, firm or corporation with whom or with which any moneys, securities or
effects shall be lodged or deposited, or for any loss, conversion,
misapplication or misappropriation of or any damage resulting from any dealings
with any moneys, securities or other assets of or belonging to the Corporation
or for any other loss, damage or misfortune whatsoever which may happen in the
execution of the duties of his respective office or trust or in relation thereto
unless the same shall happen by or through his failure to exercise the powers
and to discharge the duties of his office honestly, in good faith and with a
view to the best interests of the Corporation and to exercise the care,
diligence and skill that a reasonably prudent person would exercise in
comparable circumstances.
5.02 INDEMNITY
The Corporation shall, to the maximum extent permitted under the Act, indemnify
a director or officer, a former director or officer, and a person who acts or
acted at the Corporation's request as a director or officer of a body corporate
of which the Corporation is or was a shareholder or creditor, and his heirs and
legal representatives, against all costs, charges and expenses, including any
amount paid to settle an action
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or satisfy a judgment, reasonably incurred by him in respect of any civil,
criminal or administrative action or proceeding to which he is made a party by
reason of being or having been a director or officer of the Corporation or such
body corporate, including (without limitation) any such action by or on behalf
of the Corporation or such body corporate to procure a judgment in its favour,
and the Corporation shall use its reasonable best efforts to obtain any approval
or approvals necessary for such indemnification.
SECTION SIX SHARES
6.01 NON-RECOGNITION OF TRUSTS
Subject to the provisions of the Act, the Corporation may treat as the absolute
owner of any share the person in whose name the share is registered in the
securities register as if that person had full legal capacity and authority to
exercise all rights of ownership, irrespective of any indication to the contrary
through knowledge or notice or description in the Corporation's records or on
the share certificate.
6.02 JOINT SHAREHOLDERS
If two or more persons are registered as joint holders of any share:
(a) the Corporation shall record only one address on its books for such
joint holders;
(b) the address of such joint holders for all purposes with respect to the
Corporation shall be their recorded address; and
(c) anyone of such persons may give effectual receipts for the certificate
issued in respect thereof or for any dividend, bonus, return of capital or other
money payable or warrant issuable in respect of such share.
6.03 LIEN FOR INDEBTEDNESS
If the articles provide that the Corporation has a lien on any shares registered
in the name of a shareholder or his legal representative for a debt of that
shareholder to the Corporation, such lien may be enforced, subject to the
articles and to any unanimous shareholder agreement, by the sale of the shares
thereby affected or by any other action, suit, remedy or proceeding authorized
or permitted by law or by equity and, pending such enforcement, the Corporation
may refuse to register a transfer of the whole or any part of such shares.
SECTION SEVEN DIVIDENDS
7.01 DIVIDEND CHEQUES
A dividend payable in cash shall be paid by cheque of the Corporation or of any
dividend paying agent appointed by the board to the order of each registered
holder of shares of the class or series in respect of which it has been declared
and mailed by prepaid ordinary mail to such registered holder at his recorded
address, unless such holder otherwise directs and the Corporation agrees to
follow such direction. In the case of joint holders the cheque shall, unless
such joint holders otherwise direct and the Corporation agrees to
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follow such direction, be made payable to the order of all of such joint
holders and mailed to them at their recorded address. The mailing of such cheque
as aforesaid, unless the same is not paid on due presentation shall satisfy and
discharge the liability for the dividend to the extent of the sum represented
thereby plus the amount of any tax which the Corporation is required to and does
withhold.
7.02 NON-RECEIPT OF CHEQUES
In the event of non-receipt of any dividend cheque by the person to whom it is
sent as aforesaid, the Corporation shall issue to such person a replacement
cheque for a like amount on such terms as to indemnity, reimbursement of
expenses and evidence of non-receipt and of title as the board may from time to
time prescribe, whether generally or in any particular case.
7.03 UNCLAIMED DIVIDENDS
Any dividend unclaimed after a period of six years from the date on which the
same has been declared to be payable shall be forfeited and shall revert to the
Corporation.
SECTION EIGHT MEETINGS OF SHAREHOLDERS
8.01 CHAIRMAN, SECRETARY AND SCRUTINEERS
The chairman of any meeting of shareholders, who need not be a shareholder of
the Corporation, shall be the first mentioned of the following officers as has
been appointed and is present and is willing to so act at the meeting: chairman
of the board, president or a vice-president (in order of seniority). If no such
officer is present and willing to act as chairman within fifteen minutes from
the time fixed for holding the meeting, the persons present and entitled to vote
shall choose one of their number to be chairman. The chairman shall conduct the
proceedings at the meeting in all respects and his decision in any matter or
thing, including, but without in any way limiting the generality of the
foregoing, any question regarding the validity or invalidity of any instruments
of proxy and any question as to the admission or rejection of a vote shall be
conclusive and binding upon the shareholders. The secretary of any meeting of
shareholders shall be the secretary of the Corporation, provided that if the
Corporation does not have a secretary or if the secretary of the Corporation is
absent, the chairman shall appoint some person who need not be a shareholder, to
act as secretary of the meeting. The board may from time to time appoint in
advance of any meeting of shareholders one or more persons to act as scrutineers
at such meeting and, in the absence of such appointment, the chairman may
appoint one or more persons to act as scrutineers at any meeting of
shareholders. Scrutineers so appointed may, but need not be, shareholders,
directors, officers or employees of the Corporation.
8.02 PERSONS ENTITLED TO BE PRESENT
The only persons entitled to be present at a meeting of shareholders shall be:
(a) those entitled to vote at such meeting;
(b) the directors and auditors of the Corporation;
(c) others who, although not entitled to vote, are entitled or required under
any provision of the Act, the articles or the by-laws to be present at the
meeting;
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(d) legal counsel to the Corporation when invited by the Corporation to attend
the meeting; and
(e) any other person on the invitation of the chairman or with the consent of
the meeting.
8.03 QUORUM
A quorum for the transaction of business at any meeting of shareholders shall be
at least two persons present in person, each being a shareholder entitled to
vote thereat or a duly appointed proxy or representative for an absent
shareholder so entitled, and representing in the aggregate not less than 10% of
the outstanding shares of the Corporation carrying voting rights at the meeting,
provided that, if there should be only one shareholder of the Corporation
entitled to vote at any meeting of shareholders, the quorum for the transaction
of business at a meeting of shareholders shall consist of the one shareholder.
8.04 REPRESENTATIVES
The authority of an individual to represent a body corporate or association at a
meeting of shareholders of the Corporation shall be established by depositing
with the Corporation a certified copy of the resolution of the directors or
governing body of the body corporate or association, as the case may be,
granting such authority, or in such other manner as may be satisfactory to the
chairman of the meeting.
8.05 ACTION BY SHAREHOLDERS
The shareholders shall act by ordinary resolution unless otherwise required by
the Act, articles, by-laws or any unanimous shareholders agreement. In case of
an equality of votes either upon a show of hands or upon a poll, the chairman of
the meeting shall be entitled to a second or casting vote.
8.06 SHOW OF HANDS
Upon a show of hands every person who is present and entitled to vote shall have
one vote. Whenever a vote by show of hands shall have been taken upon a
question, unless a ballot thereon is required or demanded, a declaration by the
chairman of the meeting that the vote upon the question has been carried or
carried by a particular majority or not carried and an entry to that effect in
the minutes of the meeting shall be prima facie evidence of that fact without
proof of the number or proportion of the votes recorded in favour of or against
any resolution or other proceeding in respect of the said question, and the
result of the vote so taken shall be the decision of the shareholders upon the
said question.
8.07 BALLOTS
A ballot required or demanded shall be taken in such manner as the chairman
shall direct. A requirement or demand for a ballot may be withdrawn at any time
prior to the taking of the ballot. If a ballot is taken each person present
shall be entitled, in respect of the shares which he is entitled to vote at the
meeting upon the question, to that number of votes provided by the Act or the
articles, and the result of the ballot so taken shall be the decision of the
shareholders upon the said question.
8.08 MEETINGS BY TELEPHONE
With the consent of the chairman of the meeting or the consent (as evidenced by
a resolution) of the persons present and entitled to vote at the meeting, a
shareholder or any other person entitled to attend a meeting of shareholders may
participate in the meeting by means of telephone or other communication
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facilities that permit all persons participating in the meeting to hear each
other, and a person participating in such a meeting by those means shall be
considered present at the meeting and at the place of the meeting.
SECTION NINE NOTICES
9.01 OMISSIONS AND ERRORS
The accidental omission to give any notice to any shareholder, director,
officer, auditor or member of a committee of the board or the non-receipt of any
notice by any such person or any error in any notice not affecting the substance
thereof shall not invalidate any action taken at any meeting held pursuant to
such notice or otherwise founded thereon.
9.02 PERSONS ENTITLED BY DEATH OR OPERATION OF LAW
Every person who, by operation of law, transfer, death of a shareholder or any
other means whatsoever shall become entitled to any share, shall be bound by
every notice in respect of such share which shall have been duly given to the
shareholder from whom he derives his title to such share prior to his name and
address being entered on the securities register (whether such notice was given
before or after the happening of the event upon which he became so entitled) and
prior to his furnishing to the Corporation the proof of authority or evidence of
his entitlement prescribed by the Act.
SECTION TEN EFFECTIVE DATE AND REPEAL
10.01 EFFECTIVE DATE
This by-law shall come into force upon the date of continuance of the
Corporation under the Act.
10.02 REPEAL
All previous by-laws (including without limitation the Articles of the
Corporation under the Company Act of British Columbia) of the Corporation are
repealed as of the coming into force of this by-law. Such repeal shall not
affect the previous operation of any by-law so repealed or affect the validity
of any act done or right, privilege, obligation or liability acquired or
incurred under, or the validity of any contract or agreement made pursuant to,
or the validity of any articles (as defined in the Act) or predecessor charter
documents of the Corporation obtained pursuant to, any such by-law prior to its
repeal. All officers and persons acting under any such by-law so repealed shall
continue to act as if appointed under the
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provisions of this by-law and all resolutions of the shareholders, the board or
a committee of the board with continuing effect passed under any repealed by-law
shall continue to be good and valid except to the extent inconsistent with this
by-law and until amended or repealed.
MADE BY THE BOARD THE 23RD DAY of May 1997
(signature) Chairman of the Board
CONFIRMED BY THE SHAREHOLDERS IN ACCORDANCE WITH THE ACT THE 2ND DAY OF JUNE
1997.
CHAIRMAN OF THE BOARD
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