EXHIBIT 3.1
BPI INDUSTRIES INC.
(THE "COMPANY")
INCORPORATION NUMBER: BCO214676
BPI INDUSTRIES INC.
(THE "COMPANY")
ARTICLES
1. Interpretation....................................................................... 1
2. Shares and Share Certificates........................................................ 2
3. Issue of Shares...................................................................... 4
4. Share Registers...................................................................... 5
5. Share Transfers...................................................................... 5
6. Transmission of Shares............................................................... 6
7. Purchase of Shares................................................................... 7
8. Borrowing Powers..................................................................... 7
9. Alterations.......................................................................... 8
10. Meetings of Shareholders............................................................. 9
11. Proceedings at Meetings of Shareholders.............................................. 11
12. Votes of Shareholders................................................................ 15
13. Directors............................................................................ 19
14. Election and Removal of Directors.................................................... 20
15. Alternate Directors.................................................................. 23
16. Powers and Duties of Directors....................................................... 25
17. Disclosure of Interest of Directors.................................................. 25
18. Proceedings of Directors............................................................. 26
19. Executive and Other Committees....................................................... 29
20. Officers............................................................................. 30
21. Indemnification...................................................................... 31
22. Dividends and Reserves............................................................... 32
23. Documents, Records and Reports....................................................... 34
24. Notices.............................................................................. 34
25. Seal................................................................................. 36
26. Prohibitions......................................................................... 37
1. INTERPRETATION
1.1 DEFINITIONS
In these Articles, unless the context otherwise requires:
(1) "board of directors", "directors" and "board" mean the directors or sole
director of the Company for the time being;
(2) "Business Corporations Act" means the Business Corporations Act (British
Columbia) from time to time in force and all amendments thereto and
includes all regulations and amendments thereto made pursuant to that Act;
(3) "legal personal representative" means the personal or other legal
representative of the shareholder;
(4) "registered address" of a shareholder means the shareholder's address as
recorded in the central securities register;
(5) "seal" means the seal of the Company, if any.
1.2 BUSINESS CORPORATIONS ACT AND INTERPRETATION ACT DEFINITIONS APPLICABLE
The definitions in the Business Corporations Act and the definitions and rules
of construction in the Interpretation Act, with the necessary changes, so far as
applicable, and unless the context requires otherwise, apply to these Articles
as if they were an enactment. If there is a conflict between a definition in the
Business Corporations Act and a definition or rule in the Interpretation Act
relating to a term used in these Articles, the definition in the Business
Corporations Act will prevail in relation to the use of the term in these
Articles. If there is a conflict between these Articles and the Business
Corporations Act, the Business Corporations Act will prevail.
2. SHARES AND SHARE CERTIFICATES
2.1 AUTHORIZED SHARE STRUCTURE
The authorized share structure of the Company consists of 100,000,000 common
shares without par value.
2.2 FORM OF SHARE CERTIFICATE
Each share certificate issued by the Company must comply with, and be signed as
required by, the Business Corporations Act.
2.3 SHAREHOLDER ENTITLED TO CERTIFICATE OR ACKNOWLEDGMENT
Each shareholder is entitled, without charge, to (a) one share certificate
representing the shares of each class or series of shares registered in the
shareholder's name or (b) a non-transferable written acknowledgment of the
shareholder's right to obtain such a share certificate, provided that in respect
of a share held jointly by several persons, the Company is not bound to issue
more than one share certificate and delivery of a share certificate for a share
to one of several joint shareholders or to one of the shareholders' duly
authorized agents will be sufficient delivery to all.
-2-
2.4 DELIVERY BY MAIL
Any share certificate or non-transferable written acknowledgment of a
shareholder's right to obtain a share certificate may be sent to the shareholder
by mail at the shareholder's registered address and neither the Company nor any
director, officer or agent of the Company is liable for any loss to the
shareholder because the share certificate or acknowledgement is lost in the mail
or stolen.
2.5 REPLACEMENT OF WORN OUT OR DEFACED CERTIFICATE OR ACKNOWLEDGEMENT
If the directors are satisfied that a share certificate or a non-transferable
written acknowledgment of the shareholder's right to obtain a share certificate
is worn out or defaced, they must, on production to them of the share
certificate or acknowledgment, as the case may be, and on such other terms, if
any, as they think fit:
(1) order the share certificate or acknowledgment, as the case may be, to be
cancelled; and
(2) issue a replacement share certificate or acknowledgment, as the case may
be.
2.6 REPLACEMENT OF LOST, STOLEN OR DESTROYED CERTIFICATE OR ACKNOWLEDGMENT
If a share certificate or a non-transferable written acknowledgment of a
shareholder's right to obtain a share certificate is lost, stolen or destroyed,
a replacement share certificate or acknowledgment, as the case may be, must be
issued to the person entitled to that share certificate or acknowledgment, as
the case may be, if the directors receive:
(1) proof satisfactory to them that the share certificate or acknowledgment is
lost, stolen or destroyed; and
(2) any indemnity the directors consider adequate.
2.7 SPLITTING SHARE CERTIFICATES
If a shareholder surrenders a share certificate to the Company with a written
request that the Company issue in the shareholder's name two or more share
certificates, each representing a specified number of shares and in the
aggregate representing the same number of shares as the share certificate so
surrendered, the Company must cancel the surrendered share certificate and issue
replacement share certificates in accordance with that request.
2.8 CERTIFICATE FEE
There must be paid to the Company, in relation to the issue of any share
certificate under Articles 2.5, 2.6 or 2.7, the amount, if any and which must
not exceed the amount prescribed under the Business Corporations Act, determined
by the directors.
-3-
2.9 RECOGNITION OF TRUSTS
Except as required by law or statute or these Articles, no person will be
recognized by the Company as holding any share upon any trust, and the Company
is not bound by or compelled in any way to recognize (even when having notice
thereof) any equitable, contingent, future or partial interest in any share or
fraction of a share or (except as by law or statute or these Articles provided
or as ordered by a court of competent jurisdiction) any other rights in respect
of any share except an absolute right to the entirety thereof in the
shareholder.
3. ISSUE OF SHARES
3.1 DIRECTORS AUTHORIZED
Subject to the Business Corporations Act and the rights of the holders of issued
shares of the Company, the Company may issue, allot, sell or otherwise dispose
of the unissued shares, and issued shares held by the Company, at the times, to
the persons, including directors, in the manner, on the terms and conditions and
for the issue prices (including any premium at which shares with par value may
be issued) that the directors may determine. The issue price for a share with
par value must be equal to or greater than the par value of the share.
3.2 COMMISSIONS AND DISCOUNTS
The Company may at any time, pay a reasonable commission or allow a reasonable
discount to any person in consideration of that person purchasing or agreeing to
purchase shares of the Company from the Company or any other person or procuring
or agreeing to procure purchasers for shares of the Company.
3.3 BROKERAGE
The Company may pay such brokerage fee or other consideration as may be lawful
for or in connection with the sale or placement of its securities.
3.4 CONDITIONS OF ISSUE
Except as provided for by the Business Corporations Act, no share may be issued
until it is fully paid. A share is fully paid when:
(1) consideration is provided to the Company for the issue of the share by one
or more of the following:
(a) past services performed for the Company;
(b) property;
(c) money; and
(2) the value of the consideration received by the Company equals or exceeds
the issue price set for the share under Article 3.1.
-4-
3.5 SHARE PURCHASE WARRANTS AND RIGHTS
Subject to the Business Corporations Act, the Company may issue share purchase
warrants, options and rights upon such terms and conditions as the directors
determine, which share purchase warrants, options and rights may be issued alone
or in conjunction with debentures, debenture stock, bonds, shares or any other
securities issued or created by the Company from time to time.
4. SHARE REGISTERS
4.1 CENTRAL SECURITIES REGISTER
As required by and subject to the Business Corporations Act, the Company must
maintain in British Columbia a central securities register. The directors may,
subject to the Business Corporations Act, appoint an agent to maintain the
central securities register. The directors may also appoint one or more agents,
including the agent which keeps the central securities register, as transfer
agent for its shares or any class or series of its shares, as the case may be,
and the same or another agent as registrar for its shares or such class or
series of its shares, as the case may be. The directors may terminate such
appointment of any agent at any time and may appoint another agent in its place.
4.2 CLOSING REGISTER
The Company must not at any time close its central securities register.
5. SHARE TRANSFERS
5.1 REGISTERING TRANSFERS
A transfer of a share of the Company must not be registered unless:
(1) a duly signed instrument of transfer in respect of the share has been
received by the Company;
(2) if a share certificate has been issued by the Company in respect of the
share to be transferred, that share certificate has been surrendered to
the Company; and
(3) if a non-transferable written acknowledgment of the shareholder's right to
obtain a share certificate has been issued by the Company in respect of
the share to be transferred, that acknowledgment has been surrendered to
the Company.
5.2 FORM OF INSTRUMENT OF TRANSFER
The instrument of transfer in respect of any share of the Company must be either
in the form, if any, on the back of the Company's share certificates or in any
other form that may be approved by the directors from time to time.
-5-
5.3 TRANSFEROR REMAINS SHAREHOLDER
Except to the extent that the Business Corporations Act otherwise provides, the
transferor of shares is deemed to remain the holder of the shares until the name
of the transferee is entered in a securities register of the Company in respect
of the transfer.
5.4 SIGNING OF INSTRUMENT OF TRANSFER
If a shareholder, or his or her duly authorized attorney, signs an instrument of
transfer in respect of shares registered in the name of the shareholder, the
signed instrument of transfer constitutes a complete and sufficient authority to
the Company and its directors, officers and agents to register the number of
shares specified in the instrument of transfer or specified in any other manner,
or, if no number is specified, all the shares represented by the share
certificates or set out in the written acknowledgments deposited with the
instrument of transfer:
(1) in the name of the person named as transferee in that instrument of
transfer; or
(2) if no person is named as transferee in that instrument of transfer, in the
name of the person on whose behalf the instrument is deposited for the
purpose of having the transfer registered.
5.5 ENQUIRY AS TO TITLE NOT REQUIRED
Neither the Company nor any director, officer or agent of the Company is bound
to inquire into the title of the person named in the instrument of transfer as
transferee or, if no person is named as transferee in the instrument of
transfer, of the person on whose behalf the instrument is deposited for the
purpose of having the transfer registered or is liable for any claim related to
registering the transfer by the shareholder or by any intermediate owner or
holder of the shares, of any interest in the shares, of any share certificate
representing such shares or of any written acknowledgment of a right to obtain a
share certificate for such shares.
5.6 TRANSFER FEE
There must be paid to the Company, in relation to the registration of any
transfer, the amount, if any, determined by the directors.
6. TRANSMISSION OF SHARES
6.1 LEGAL PERSONAL REPRESENTATIVE RECOGNIZED ON DEATH
In case of the death of a shareholder, the legal personal representative, or if
the shareholder was a joint holder, the surviving joint holder, will be the only
person recognized by the Company as having any title to the shareholder's
interest in the shares. Before recognizing a person as a legal personal
representative, the directors may require proof of appointment by a court of
competent jurisdiction, a grant of letters probate, letters of administration or
such other evidence or documents as the directors consider appropriate.
-6-
6.2 RIGHTS OF LEGAL PERSONAL REPRESENTATIVE
The legal personal representative has the same rights, privileges and
obligations that attach to the shares held by the shareholder, including the
right to transfer the shares in accordance with these Articles, provided the
documents required by the Business Corporations Act and the directors have been
deposited with the Company.
7. PURCHASE OF SHARES
7.1 COMPANY AUTHORIZED TO PURCHASE SHARES
Subject to Article 7.2, the special rights and restrictions attached to the
shares of any class or series and the Business Corporations Act, the Company
may, if authorized by the directors, purchase or otherwise acquire any of its
shares at the price and upon the terms specified in such resolution.
7.2 PURCHASE WHEN INSOLVENT
The Company must not make a payment or provide any other consideration to
purchase or otherwise acquire any of its shares if there are reasonable grounds
for believing that:
(1) the Company is insolvent; or
(2) making the payment or providing the consideration would render the Company
insolvent.
7.3 SALE AND VOTING OF PURCHASED SHARES
If the Company retains a share redeemed, purchased or otherwise acquired by it,
the Company may sell, gift or otherwise dispose of the share, but, while such
share is held by the Company, it:
(1) is not entitled to vote the share at a meeting of its shareholders;
(2) must not pay a dividend in respect of the share; and
(3) must not make any other distribution in respect of the share.
8. BORROWING POWERS
The Company, if authorized by the directors, may:
(1) borrow money in the manner and amount, on the security, from the sources
and on the terms and conditions that they consider appropriate;
(2) issue bonds, debentures and other debt obligations either outright or as
security for any liability or obligation of the Company or any other
person and at such discounts or premiums and on such other terms as they
consider appropriate;
(3) guarantee the repayment of money by any other person or the performance of
any obligation of any other person; and
-7-
(4) mortgage, charge, whether by way of specific or floating charge, grant a
security interest in, or give other security on, the whole or any part of
the present and future assets and undertaking of the Company.
9. ALTERATIONS
9.1 ALTERATION OF AUTHORIZED SHARE STRUCTURE
Subject to Article 9.2 and the Business Corporations Act, the Company may by
ordinary resolution:
(1) create one or more classes or series of shares or, if none of the shares
of a class or series of shares are allotted or issued, eliminate that
class or series of shares;
(2) increase, reduce or eliminate the maximum number of shares that the
Company is authorized to issue out of any class or series of shares or
establish a maximum number of shares that the Company is authorized to
issue out of any class or series of shares for which no maximum is
established;
(3) if the Company is authorized to issue shares of a class of shares with par
value:
(a) decrease the par value of those shares; or
(b) if none of the shares of that class of shares are allotted or
issued, increase the par value of those shares;
(4) alter the identifying name of any of its shares; or
(5) otherwise alter its shares or authorized share structure when required or
permitted to do so by the Business Corporations Act.
9.2 SPECIAL RIGHTS AND RESTRICTIONS
Subject to the Business Corporations Act, the Company may by special resolution:
(1) create special rights or restrictions for, and attach those special rights
or restrictions to, the shares of any class or series of shares, whether
or not any or all of those shares have been issued;
(2) vary or delete any special rights or restrictions attached to the shares
of any class or series of shares, whether or not any or all of those
shares have been issued;
(3) subdivide or consolidate all or any of its unissued, or fully paid issued,
shares; or
(4) change all or any of its unissued, or fully paid issued, shares with par
value into shares without par value or any of its unissued shares without
par value into shares with par value.
-8-
9.3 CHANGE OF NAME
The Company may by special resolution authorize an alteration of its Notice of
Articles in order to change its name.
9.4 OTHER ALTERATIONS
If the Business Corporations Act does not specify the type of resolution and
these Articles do not specify another type of resolution, the Company may by
special resolution alter these Articles.
10. MEETINGS OF SHAREHOLDERS
10.1 ANNUAL GENERAL MEETINGS
Unless an annual general meeting is deferred or waived in accordance with the
Business Corporations Act, the Company must hold an annual general meeting at
least once in each calendar year and not more than 15 months after the last
annual reference date at such time and place as may be determined by the
directors.
10.2 RESOLUTION INSTEAD OF ANNUAL GENERAL MEETING
If all the shareholders who are entitled to vote at an annual general meeting
consent by a unanimous resolution under the Business Corporations Act to all of
the business that is required to be transacted at that annual general meeting,
the annual general meeting is deemed to have been held on the date of the
unanimous resolution. The shareholders must, in any unanimous resolution passed
under this Article 10.2, select as the Company's annual reference date a date
that would be appropriate for the holding of the applicable annual general
meeting.
10.3 CALLING OF MEETINGS OF SHAREHOLDERS
The directors may, whenever they think fit, call a meeting of shareholders.
10.4 NOTICE FOR MEETINGS OF SHAREHOLDERS
The Company must send notice of the date, time and location of any meeting of
shareholders, by way of either mail, delivery, fax or email, or in such other
manner, if any, as may be prescribed by ordinary resolution (whether previous
notice of the resolution has been given or not), to each shareholder entitled to
attend the meeting, to each director and to the auditor of the Company, unless
these Articles otherwise provide, at least the following number of days before
the meeting:
(1) if and for so long as the Company is a public company, 21 days;
(2) otherwise, 10 days.
10.5 RECORD DATE FOR NOTICE
The directors may set a date as the record date for the purpose of determining
shareholders entitled to notice of any meeting of shareholders. The record date
must not precede the date on
-9-
which the meeting is to be held by more than two months or, in the case of a
general meeting requisitioned by shareholders under the Business Corporations
Act, by more than four months. The record date must not precede the date on
which the meeting is held by fewer than:
(1) if and for so long as the Company is a public company, 21 days;
(2) otherwise, 10 days.
If no record date is set, the record date is 5 p.m. on the day immediately
preceding the first date on which the notice is sent or, if no notice is sent,
the beginning of the meeting.
10.6 RECORD DATE FOR VOTING
The directors may set a date as the record date for the purpose of determining
shareholders entitled to vote at any meeting of shareholders. The record date
must not precede the date on which the meeting is to be held by more than two
months or, in the case of a general meeting requisitioned by shareholders under
the Business Corporations Act, by more than four months. If no record date is
set, the record date is 5 p.m. on the day immediately preceding the first date
on which the notice is sent or, if no notice is sent, the beginning of the
meeting.
10.7 FAILURE TO GIVE NOTICE AND WAIVER OF NOTICE
The accidental omission to send notice of any meeting to, or the non-receipt of
any notice by, any of the persons entitled to notice does not invalidate any
proceedings at that meeting. Any person entitled to notice of a meeting of
shareholders may, in writing or otherwise, waive or reduce the period of notice
of such meeting.
10.8 NOTICE OF SPECIAL BUSINESS AT MEETINGS OF SHAREHOLDERS
If a meeting of shareholders is to consider special business within the meaning
of Article 11.1, the notice of meeting must:
(1) state the general nature of the special business; and
(2) if the special business includes considering, approving, ratifying,
adopting or authorizing any document or the signing of or giving of effect
to any document, have attached to it a copy of the document or state that
a copy of the document will be available for inspection by shareholders:
(a) at the Company's records office, or at such other reasonably
accessible location in British Columbia as is specified in the
notice; and
(b) during statutory business hours on any one or more specified days
before the day set for the holding of the meeting.
-10-
11. PROCEEDINGS AT MEETINGS OF SHAREHOLDERS
11.1 SPECIAL BUSINESS
At a meeting of shareholders, the following business is special business:
(1) at a meeting of shareholders that is not an annual general meeting, all
business is special business except business relating to the conduct of or
voting at the meeting;
(2) at an annual general meeting, all business is special business except for
the following:
(a) business relating to the conduct of or voting at the meeting;
(b) consideration of any financial statements of the Company presented
to the meeting;
(c) consideration of any reports of the directors or auditor;
(d) the setting or changing of the number of directors;
(e) the election or appointment of directors;
(f) the appointment of an auditor;
(g) the setting of the remuneration of an auditor;
(h) business arising out of a report of the directors not requiring the
passing of a special resolution or an exceptional resolution;
(i) any other business which, under these Articles or the Business
Corporations Act, may be transacted at a meeting of shareholders
without prior notice of the business being given to the
shareholders.
11.2 SPECIAL MAJORITY
The majority of votes required for the Company to pass a special resolution at a
meeting of shareholders is 2/3 of the votes cast on the resolution.
11.3 QUORUM
Subject to the special rights and restrictions attached to the shares of any
class or series of shares, the quorum for the transaction of business at a
meeting of shareholders is two persons who are, or who represent by proxy,
shareholders who, in the aggregate, hold at least 5% of the issued shares
entitled to be voted at the meeting.
-11-
11.4 ONE SHAREHOLDER MAY CONSTITUTE QUORUM
If there is only one shareholder entitled to vote at a meeting of shareholders:
(1) the quorum is one person who is, or who represents by proxy, that
shareholder, and
(2) that shareholder, present in person or by proxy, may constitute the
meeting.
11.5 OTHER PERSONS MAY ATTEND
The directors, the president (if any), the secretary (if any), the assistant
secretary (if any), any lawyer for the Company, the auditor of the Company and
any other persons invited by the directors are entitled to attend any meeting of
shareholders, but if any of those persons does attend a meeting of shareholders,
that person is not to be counted in the quorum and is not entitled to vote at
the meeting unless that person is a shareholder or proxy holder entitled to vote
at the meeting.
11.6 REQUIREMENT OF QUORUM
No business, other than the election of a chair of the meeting and the
adjournment of the meeting, may be transacted at any meeting of shareholders
unless a quorum of shareholders entitled to vote is present at the commencement
of the meeting, but such quorum need not be present throughout the meeting.
11.7 LACK OF QUORUM
If, within one-half hour from the time set for the holding of a meeting of
shareholders, a quorum is not present:
(1) in the case of a general meeting requisitioned by shareholders, the
meeting is dissolved, and
(2) in the case of any other meeting of shareholders, the meeting stands
adjourned to the same day in the next week at the same time and place.
11.8 LACK OF QUORUM AT SUCCEEDING MEETING
If, at the meeting to which the meeting referred to in Article 11.7(2) was
adjourned, a quorum is not present within one-half hour from the time set for
the holding of the meeting, the person or persons present and being, or
representing by proxy, one or more shareholders entitled to attend and vote at
the meeting constitute a quorum.
11.9 CHAIR
The following individual is entitled to preside as chair at a meeting of
shareholders:
(1) the chair of the board, if any; or
-12-
(2) if the chair of the board is absent or unwilling to act as chair of the
meeting, the president, if any.
11.10 SELECTION OF ALTERNATE CHAIR
If, at any meeting of shareholders, there is no chair of the board or president
present within 15 minutes after the time set for holding the meeting, or if the
chair of the board and the president are unwilling to act as chair of the
meeting, or if the chair of the board and the president have advised the
secretary, if any, or any director present at the meeting, that they will not be
present at the meeting, the directors present must choose one of their number to
be chair of the meeting or if all of the directors present decline to take the
chair or fail to so choose or if no director is present, the shareholders
entitled to vote at the meeting who are present in person or by proxy may choose
any person present at the meeting to chair the meeting.
11.11 ADJOURNMENTS
The chair of a meeting of shareholders may, and if so directed by the meeting
must, adjourn the meeting from time to time and from place to place, but no
business may be transacted at any adjourned meeting other than the business left
unfinished at the meeting from which the adjournment took place.
11.12 NOTICE OF ADJOURNED MEETING
It is not necessary to give any notice of an adjourned meeting or of the
business to be transacted at an adjourned meeting of shareholders except that,
when a meeting is adjourned for 30 days or more, notice of the adjourned meeting
must be given as in the case of the original meeting.
11.13 DECISIONS BY SHOW OF HANDS OR POLL
Subject to the Business Corporations Act, every motion put to a vote at a
meeting of shareholders will be decided on a show of hands unless a poll, before
or on the declaration of the result of the vote by show of hands, is directed by
the chair or demanded by at least one shareholder entitled to vote who is
present in person or by proxy.
11.14 DECLARATION OF RESULT
The chair of a meeting of shareholders must declare to the meeting the decision
on every question in accordance with the result of the show of hands or the
poll, as the case may be, and that decision must be entered in the minutes of
the meeting. A declaration of the chair that a resolution is carried by the
necessary majority or is defeated is, unless a poll is directed by the chair or
demanded under Article 11.13, conclusive evidence without proof of the number or
proportion of the votes recorded in favour of or against the resolution.
11.15 MOTION NEED NOT BE SECONDED
No motion proposed at a meeting of shareholders need be seconded unless the
chair of the meeting rules otherwise, and the chair of any meeting of
shareholders is entitled to propose or second a motion.
-13-
11.16 CASTING VOTE
In case of an equality of votes, the chair of a meeting of shareholders does
not, either on a show of hands or on a poll, have a second or casting vote in
addition to the vote or votes to which the chair may be entitled as a
shareholder.
11.17 MANNER OF TAKING POLL
Subject to Article 11.18, if a poll is duly demanded at a meeting of
shareholders:
(1) the poll must be taken:
(a) at the meeting, or within seven days after the date of the meeting,
as the chair of the meeting directs; and
(b) in the manner, at the time and at the place that the chair of the
meeting directs;
(2) the result of the poll is deemed to be the decision of the meeting at
which the poll is demanded; and
(3) the demand for the poll may be withdrawn by the person who demanded it.
11.18 DEMAND FOR POLL ON ADJOURNMENT
A poll demanded at a meeting of shareholders on a question of adjournment must
be taken immediately at the meeting.
11.19 CHAIR MUST RESOLVE DISPUTE
In the case of any dispute as to the admission or rejection of a vote given on a
poll, the chair of the meeting must determine the dispute, and his or her
determination made in good faith is final and conclusive.
11.20 CASTING OF VOTES
On a poll, a shareholder entitled to more than one vote need not cast all the
votes in the same way.
11.21 DEMAND FOR POLL
No poll may be demanded in respect of the vote by which a chair of a meeting of
shareholders is elected.
11.22 DEMAND FOR POLL NOT TO PREVENT CONTINUANCE OF MEETING
The demand for a poll at a meeting of shareholders does not, unless the chair of
the meeting so rules, prevent the continuation of a meeting for the transaction
of any business other than the question on which a poll has been demanded.
-14-
11.23 RETENTION OF BALLOTS AND PROXIES
The Company must, for at least three months after a meeting of shareholders,
keep each ballot cast on a poll and each proxy voted at the meeting, and, during
that period, make them available for inspection during normal business hours by
any shareholder or proxyholder entitled to vote at the meeting. At the end of
such three month period, the Company may destroy such ballots and proxies.
12. VOTES OF SHAREHOLDERS
12.1 NUMBER OF VOTES BY SHAREHOLDER OR BY SHARES
Subject to any special rights or restrictions attached to any shares and to the
restrictions imposed on joint shareholders under Article 12.3:
(1) on a vote by show of hands, every person present who is a shareholder or
proxy holder and entitled to vote on the matter has one vote; and
(2) on a poll, every shareholder entitled to vote on the matter has one vote
in respect of each share entitled to be voted on the matter and held by
that shareholder and may exercise that vote either in person or by proxy.
12.2 VOTES OF PERSONS IN REPRESENTATIVE CAPACITY
A person who is not a shareholder may vote at a meeting of shareholders, whether
on a show of hands or on a poll, and may appoint a proxy holder to act at the
meeting, if, before doing so, the person satisfies the chair of the meeting, or
the directors, that the person is a legal personal representative or a trustee
in bankruptcy for a shareholder who is entitled to vote at the meeting.
12.3 VOTES BY JOINT HOLDERS
If there are joint shareholders registered in respect of any share:
(1) any one of the joint shareholders may vote at any meeting, either
personally or by proxy, in respect of the share as if that joint
shareholder were solely entitled to it; or
(2) if more than one of the joint shareholders is present at any meeting,
personally or by proxy, and more than one of them votes in respect of that
share, then only the vote of the joint shareholder present whose name
stands first on the central securities register in respect of the share
will be counted.
12.4 LEGAL PERSONAL REPRESENTATIVES AS JOINT SHAREHOLDERS
Two or more legal personal representatives of a shareholder in whose sole name
any share is registered are, for the purposes of Article 12.3, deemed to be
joint shareholders.
-15-
12.5 REPRESENTATIVE OF A CORPORATE SHAREHOLDER
If a corporation, that is not a subsidiary of the Company, is a shareholder,
that corporation may appoint a person to act as its representative at any
meeting of shareholders of the Company, and:
(1) for that purpose, the instrument appointing a representative must:
(a) be received at the registered office of the Company or at any other
place specified, in the notice calling the meeting, for the receipt
of proxies, at least the number of business days specified in the
notice for the receipt of proxies, or if no number of days is
specified, two business days before the day set for the holding of
the meeting; or
(b) be provided, at the meeting, to the chair of the meeting or to a
person designated by the chair of the meeting;
(2) if a representative is appointed under this Article 12.5:
(a) the representative is entitled to exercise in respect of and at that
meeting the same rights on behalf of the corporation that the
representative represents as that corporation could exercise if it
were a shareholder who is an individual, including, without
limitation, the right to appoint a proxy holder; and
(b) the representative, if present at the meeting, is to be counted for
the purpose of forming a quorum and is deemed to be a shareholder
present in person at the meeting.
Evidence of the appointment of any such representative may be sent to the
Company by written instrument, fax or any other method of transmitting legibly
recorded messages.
12.6 PROXY PROVISIONS DO NOT APPLY TO ALL COMPANIES
Articles 12.7 to 12.15 do not apply to the Company if and for so long as it is a
public company or a pre-existing reporting company which has the Statutory
Reporting Company Provisions as part of its Articles or to which the Statutory
Reporting Company Provisions apply.
12.7 APPOINTMENT OF PROXY HOLDERS
Every shareholder of the Company, including a corporation that is a shareholder
but not a subsidiary of the Company, entitled to vote at a meeting of
shareholders of the Company may, by proxy, appoint one or more (but not more
than five) proxy holders to attend and act at the meeting in the manner, to the
extent and with the powers conferred by the proxy.
12.8 ALTERNATE PROXY HOLDERS
A shareholder may appoint one or more alternate proxy holders to act in the
place of an absent proxy holder.
-16-
12.9 WHEN PROXY HOLDER NEED NOT BE SHAREHOLDER
A person must not be appointed as a proxy holder unless the person is a
shareholder, although a person who is not a shareholder may be appointed as a
proxy holder if:
(1) the person appointing the proxy holder is a corporation or a
representative of a corporation appointed under Article 12.5;
(2) the Company has at the time of the meeting for which the proxy holder is
to be appointed only one shareholder entitled to vote at the meeting; or
(3) the shareholders present in person or by proxy at and entitled to vote at
the meeting for which the proxy holder is to be appointed, by a resolution
on which the proxy holder is not entitled to vote but in respect of which
the proxy holder is to be counted in the quorum, permit the proxy holder
to attend and vote at the meeting.
12.10 DEPOSIT OF PROXY
A proxy for a meeting of shareholders must:
(1) be received at the registered office of the Company or at any other place
specified, in the notice calling the meeting, for the receipt of proxies,
at least the number of business days specified in the notice, or if no
number of days is specified, two business days before the day set for the
holding of the meeting; or
(2) unless the notice provides otherwise, be provided, at the meeting, to the
chair of the meeting or to a person designated by the chair of the
meeting.
A proxy may be sent to the Company by written instrument, fax or any other
method of transmitting legibly recorded messages.
12.11 VALIDITY OF PROXY VOTE
A vote given in accordance with the terms of a proxy is valid notwithstanding
the death or incapacity of the shareholder giving the proxy and despite the
revocation of the proxy or the revocation of the authority under which the proxy
is given, unless notice in writing of that death, incapacity or revocation is
received:
(1) at the registered office of the Company, at any time up to and including
the last business day before the day set for the holding of the meeting at
which the proxy is to be used; or
(2) by the chair of the meeting, before the vote is taken.
-17-
12.12 FORM OF PROXY
A proxy, whether for a specified meeting or otherwise, must be either in the
following form or in any other form approved by the directors or the chair of
the meeting:
[name of company]
(the "Company")
The undersigned, being a shareholder of the Company, hereby appoints
[name] or, failing that person, [name], as proxy holder for the
undersigned to attend, act and vote for and on behalf of the undersigned
at the meeting of shareholders of the Company to be held on [month, day,
year] and at any adjournment of that meeting.
Number of shares in respect of which this proxy is given (if no number is
specified, then this proxy if given in respect of all shares registered in
the name of the shareholder):
_______________________________________
Signed [month, day, year]
_______________________________________
[Signature of shareholder]
_______________________________________
[Name of shareholder - printed]
12.13 REVOCATION OF PROXY
Subject to Article 12.14, every proxy may be revoked by an instrument in writing
that is:
(1) received at the registered office of the Company at any time up to and
including the last business day before the day set for the holding of the
meeting at which the proxy is to be used; or
(2) provided, at the meeting, to the chair of the meeting.
12.14 REVOCATION OF PROXY MUST BE SIGNED
An instrument referred to in Article 12.13 must be signed as follows:
(1) if the shareholder for whom the proxy holder is appointed is an
individual, the instrument must be signed by the shareholder or his or her
legal personal representative or trustee in bankruptcy;
(2) if the shareholder for whom the proxy holder is appointed is a
corporation, the instrument must be signed by the corporation or by a
representative appointed for the corporation under Article 12.5.
-18-
12.15 PRODUCTION OF EVIDENCE OF AUTHORITY TO VOTE
The chair of any meeting of shareholders may, but need not, inquire into the
authority of any person to vote at the meeting and may, but need not, demand
from that person production of evidence as to the existence of the authority to
vote.
13. DIRECTORS
13.1 NUMBER OF DIRECTORS
The number of directors, excluding additional directors appointed under Article
14.8, is set at:
(1) subject to paragraphs (2) and (3), the number of directors that is equal
to the number of the Company's first directors;
(2) if the Company is a public company, the greater of three and the most
recently set of:
(a) the number of directors set by ordinary resolution (whether or not
previous notice of the resolution was given); and
(b) the number of directors set under Article 14.4;
(3) if the Company is not a public company, the most recently set of:
(a) the number of directors set by ordinary resolution (whether or not
previous notice of the resolution was given); and
(b) the number of directors set under Article 14.4.
13.2 CHANGE IN NUMBER OF DIRECTORS
If the number of directors is set under Articles 13.1(2)(a) or 13.1(3)(a):
(1) the shareholders may elect or appoint the directors needed to fill any
vacancies in the board of directors up to that number;
(2) if the shareholders do not elect or appoint the directors needed to fill
any vacancies in the board of directors up to that number
contemporaneously with the setting of that number, then the directors may
appoint, or the shareholders may elect or appoint, directors to fill those
vacancies.
13.3 DIRECTORS' ACTS VALID DESPITE VACANCY
An act or proceeding of the directors is not invalid merely because fewer than
the number of directors set or otherwise required under these Articles is in
office.
-19-
13.4 QUALIFICATIONS OF DIRECTORS
A director is not required to hold a share in the capital of the Company as
qualification for his or her office but must be qualified as required by the
Business Corporations Act to become, act or continue to act as a director.
13.5 REMUNERATION OF DIRECTORS
The directors are entitled to the remuneration for acting as directors, if any,
as the directors may from time to time determine. If the directors so decide,
the remuneration of the directors, if any, will be determined by the
shareholders. That remuneration may be in addition to any salary or other
remuneration paid to any officer or employee of the Company as such, who is also
a director.
13.6 REIMBURSEMENT OF EXPENSES OF DIRECTORS
The Company must reimburse each director for the reasonable expenses that he or
she may incur in and about the business of the Company.
13.7 SPECIAL REMUNERATION FOR DIRECTORS
If any director performs any professional or other services for the Company that
in the opinion of the directors are outside the ordinary duties of a director,
or if any director is otherwise specially occupied in or about the Company's
business, he or she may be paid remuneration fixed by the directors, or, at the
option of that director, fixed by ordinary resolution, and such remuneration may
be either in addition to, or in substitution for, any other remuneration that he
or she may be entitled to receive.
13.8 GRATUITY, PENSION OR ALLOWANCE ON RETIREMENT OF DIRECTOR
Unless otherwise determined by ordinary resolution, the directors on behalf of
the Company may pay a gratuity or pension or allowance on retirement to any
director who has held any salaried office or place of profit with the Company or
to his or her spouse or dependants and may make contributions to any fund and
pay premiums for the purchase or provision of any such gratuity, pension or
allowance.
14. ELECTION AND REMOVAL OF DIRECTORS
14.1 ELECTION AT ANNUAL GENERAL MEETING
At every annual general meeting and in every unanimous resolution contemplated
by Article 10.2:
(1) the shareholders entitled to vote at the annual general meeting for the
election of directors must elect, or in the unanimous resolution appoint,
a board of directors consisting of the number of directors for the time
being set under these Articles;
-20-
(2) each director may be elected for a term of office of one or more years of
office as may be specified by ordinary resolution at the time he is
elected. In the absence of any such ordinary resolution, a director's term
of office shall be one year of office. No director shall be elected for a
term of office exceeding five years of office. The shareholders may, by
special resolution, vary the term of office of any director; and
(3) all directors are eligible for re-election or re-appointment.
14.2 CONSENT TO BE A DIRECTOR
No election, appointment or designation of an individual as a director is valid
unless:
(1) that individual consents to be a director in the manner provided for in
the Business Corporations Act;
(2) that individual is elected or appointed at a meeting at which the
individual is present and the individual does not refuse, at the meeting,
to be a director; or
(3) with respect to first directors, the designation is otherwise valid under
the Business Corporations Act.
14.3 FAILURE TO ELECT OR APPOINT DIRECTORS
If:
(1) the Company fails to hold an annual general meeting, and all the
shareholders who are entitled to vote at an annual general meeting fail to
pass the unanimous resolution contemplated by Article 10.2, on or before
the date by which the annual general meeting is required to be held under
the Business Corporations Act; or
(2) the shareholders fail, at the annual general meeting or in the unanimous
resolution contemplated by Article 10.2, to elect or appoint any
directors;
then each director then in office continues to hold office until the earlier of:
(3) the date on which his or her successor is elected or appointed; and
(4) the date on which he or she otherwise ceases to hold office under the
Business Corporations Act or these Articles.
14.4 PLACES OF RETIRING DIRECTORS NOT FILLED
If, at any meeting of shareholders at which there should be an election of
directors, the places of any of the retiring directors are not filled by that
election, those retiring directors who are not re-elected and who are asked by
the newly elected directors to continue in office will, if willing to do so,
continue in office to complete the number of directors for the time being set
pursuant to these Articles until further new directors are elected at a meeting
of shareholders convened for that purpose. If any such election or continuance
of directors does not result in the election or
-21-
continuance of the number of directors for the time being set pursuant to these
Articles, the number of directors of the Company is deemed to be set at the
number of directors actually elected or continued in office.
14.5 DIRECTORS MAY FILL CASUAL VACANCIES
Any casual vacancy occurring in the board of directors may be filled by the
directors.
14.6 REMAINING DIRECTORS POWER TO ACT
The directors may act notwithstanding any vacancy in the board of directors, but
if the Company has fewer directors in office than the number set pursuant to
these Articles as the quorum of directors, the directors may only act for the
purpose of appointing directors up to that number or of summoning a meeting of
shareholders for the purpose of filling any vacancies on the board of directors
or, subject to the Business Corporations Act, for any other purpose.
14.7 SHAREHOLDERS MAY FILL VACANCIES
If the Company has no directors or fewer directors in office than the number set
pursuant to these Articles as the quorum of directors, the shareholders may
elect or appoint directors to fill any vacancies on the board of directors.
14.8 ADDITIONAL DIRECTORS
Notwithstanding Articles 13.1 and 13.2, between annual general meetings or
unanimous resolutions contemplated by Article 10.2, the directors may appoint
one or more additional directors, but the number of additional directors
appointed under this Article 14.8 must not at any time exceed:
(1) one-third of the number of first directors, if, at the time of the
appointments, one or more of the first directors have not yet completed
their first term of office; or
(2) in any other case, one-third of the number of the current directors who
were elected or appointed as directors other than under this Article 14.8.
Any director so appointed ceases to hold office immediately before the next
election or appointment of directors under Article 14.1(1), but is eligible for
re-election or re-appointment.
14.9 CEASING TO BE A DIRECTOR
A director ceases to be a director when:
(1) the term of office of the director expires;
(2) the director dies;
(3) the director resigns as a director by notice in writing provided to the
Company or a lawyer for the Company; or
-22-
(4) the director is removed from office pursuant to Articles 14.10 or 14.11.
14.10 REMOVAL OF DIRECTOR BY SHAREHOLDERS
The Company may remove any director before the expiration of his or her term of
office by special resolution. In that event, the shareholders may elect, or
appoint by ordinary resolution, a director to fill the resulting vacancy. If the
shareholders do not elect or appoint a director to fill the resulting vacancy
contemporaneously with the removal, then the directors may appoint or the
shareholders may elect, or appoint by ordinary resolution, a director to fill
that vacancy.
14.11 REMOVAL OF DIRECTOR BY DIRECTORS
The directors may remove any director before the expiration of his or her term
of office if the director is convicted of an indictable offence, or if the
director ceases to be qualified to act as a director of a company and does not
promptly resign, and the directors may appoint a director to fill the resulting
vacancy.
15. ALTERNATE DIRECTORS
15.1 APPOINTMENT OF ALTERNATE DIRECTOR
Any director (an "appointor") may by notice in writing received by the Company
appoint any person (an "appointee") who is qualified to act as a director to be
his or her alternate to act in his or her place at meetings of the directors or
committees of the directors at which the appointor is not present unless (in the
case of an appointee who is not a director) the directors have reasonably
disapproved the appointment of such person as an alternate director and have
given notice to that effect to his or her appointor within a reasonable time
after the notice of appointment is received by the Company.
15.2 NOTICE OF MEETINGS
Every alternate director so appointed is entitled to notice of meetings of the
directors and of committees of the directors of which his or her appointor is a
member and to attend and vote as a director at any such meetings at which his or
her appointor is not present.
15.3 ALTERNATE FOR MORE THAN ONE DIRECTOR ATTENDING MEETINGS
A person may be appointed as an alternate director by more than one director,
and an alternate director:
(1) will be counted in determining the quorum for a meeting of directors once
for each of his or her appointors and, in the case of an appointee who is
also a director, once more in that capacity;
(2) has a separate vote at a meeting of directors for each of his or her
appointors and, in the case of an appointee who is also a director, an
additional vote in that capacity;
-23-
(3) will be counted in determining the quorum for a meeting of a committee of
directors once for each of his or her appointors who is a member of that
committee and, in the case of an appointee who is also a member of that
committee as a director, once more in that capacity;
(4) has a separate vote at a meeting of a committee of directors for each of
his or her appointors who is a member of that committee and, in the case
of an appointee who is also a shareholder of that committee as a director,
an additional vote in that capacity.
15.4 CONSENT RESOLUTIONS
Every alternate director, if authorized by the notice appointing him or her, may
sign in place of his or her appointor any resolutions to be consented to in
writing.
15.5 ALTERNATE DIRECTOR NOT AN AGENT
Every alternate director is deemed not to be the agent of his or her appointor.
15.6 REVOCATION OF APPOINTMENT OF ALTERNATE DIRECTOR
An appointor may at any time, by notice in writing received by the Company,
revoke the appointment of an alternate director appointed by him or her.
15.7 CEASING TO BE AN ALTERNATE DIRECTOR
The appointment of an alternate director ceases when:
(1) his or her appointor ceases to be a director and is not promptly
re-elected or re-appointed;
(2) the alternate director dies;
(3) the alternate director resigns as an alternate director by notice in
writing provided to the Company or a lawyer for the Company;
(4) the alternate director ceases to be qualified to act as a director; or
(5) his or her appointor revokes the appointment of the alternate director.
15.8 REMUNERATION AND EXPENSES OF ALTERNATE DIRECTOR
The Company may reimburse an alternate director for the reasonable expenses that
would be properly reimbursed if he or she were a director, and the alternate
director is entitled to receive from the Company such proportion, if any, of the
remuneration otherwise payable to the appointor as the appointor may from time
to time direct.
-24-
16. POWERS AND DUTIES OF DIRECTORS
16.1 POWERS OF MANAGEMENT
The directors must, subject to the Business Corporations Act and these Articles,
manage or supervise the management of the business and affairs of the Company
and have the authority to exercise all such powers of the Company as are not, by
the Business Corporations Act or by these Articles, required to be exercised by
the shareholders of the Company.
16.2 APPOINTMENT OF ATTORNEY OF COMPANY
The directors may from time to time, by power of attorney or other instrument,
under seal if so required by law, appoint any person to be the attorney of the
Company for such purposes, and with such powers, authorities and discretions
(not exceeding those vested in or exercisable by the directors under these
Articles and excepting the power to fill vacancies in the board of directors, to
remove a director, to change the membership of, or fill vacancies in, any
committee of the directors, to appoint or remove officers appointed by the
directors and to declare dividends) and for such period, and with such
remuneration and subject to such conditions as the directors may think fit. Any
such power of attorney may contain such provisions for the protection or
convenience of persons dealing with such attorney as the directors think fit.
Any such attorney may be authorized by the directors to sub-delegate all or any
of the powers, authorities and discretions for the time being vested in him or
her.
17. DISCLOSURE OF INTEREST OF DIRECTORS
17.1 OBLIGATION TO ACCOUNT FOR PROFITS
A director or senior officer who holds a disclosable interest (as that term is
used in the Business Corporations Act) in a contract or transaction into which
the Company has entered or proposes to enter is liable to account to the Company
for any profit that accrues to the director or senior officer under or as a
result of the contract or transaction only if and to the extent provided in the
Business Corporations Act.
17.2 RESTRICTIONS ON VOTING BY REASON OF INTEREST
A director who holds a disclosable interest in a contract or transaction into
which the Company has entered or proposes to enter is not entitled to vote on
any directors' resolution to approve that contract or transaction, unless all
the directors have a disclosable interest in that contract or transaction, in
which case any or all of those directors may vote on such resolution.
17.3 INTERESTED DIRECTOR COUNTED IN QUORUM
A director who holds a disclosable interest in a contract or transaction into
which the Company has entered or proposes to enter and who is present at the
meeting of directors at which the contract or transaction is considered for
approval may be counted in the quorum at the meeting whether or not the director
votes on any or all of the resolutions considered at the meeting.
-25-
17.4 DISCLOSURE OF CONFLICT OF INTEREST OR PROPERTY
A director or senior officer who holds any office or possesses any property,
right or interest that could result, directly or indirectly, in the creation of
a duty or interest that materially conflicts with that individual's duty or
interest as a director or senior officer, must disclose the nature and extent of
the conflict as required by the Business Corporations Act.
17.5 DIRECTOR HOLDING OTHER OFFICE IN THE COMPANY
A director may hold any office or place of profit with the Company, other than
the office of auditor of the Company, in addition to his or her office of
director for the period and on the terms (as to remuneration or otherwise) that
the directors may determine.
17.6 NO DISQUALIFICATION
No director or intended director is disqualified by his or her office from
contracting with the Company either with regard to the holding of any office or
place of profit the director holds with the Company or as vendor, purchaser or
otherwise, and no contract or transaction entered into by or on behalf of the
Company in which a director is in any way interested is liable to be voided for
that reason.
17.7 PROFESSIONAL SERVICES BY DIRECTOR OR OFFICER
Subject to the Business Corporations Act, a director or officer, or any person
in which a director or officer has an interest, may act in a professional
capacity for the Company, except as auditor of the Company, and the director or
officer or such person is entitled to remuneration for professional services as
if that director or officer were not a director or officer.
17.8 DIRECTOR OR OFFICER IN OTHER CORPORATIONS
A director or officer may be or become a director, officer or employee of, or
otherwise interested in, any person in which the Company may be interested as a
shareholder or otherwise, and, subject to the Business Corporations Act, the
director or officer is not accountable to the Company for any remuneration or
other benefits received by him or her as director, officer or employee of, or
from his or her interest in, such other person.
18. PROCEEDINGS OF DIRECTORS
18.1 MEETINGS OF DIRECTORS
The directors may meet together for the conduct of business, adjourn and
otherwise regulate their meetings as they think fit, and meetings of the
directors held at regular intervals may be held at the place, at the time and on
the notice, if any, as the directors may from time to time determine.
18.2 VOTING AT MEETINGS
Questions arising at any meeting of directors are to be decided by a majority of
votes and, in the case of an equality of votes, the chair of the meeting does
not have a second or casting vote.
-26-
18.3 CHAIR OF MEETINGS
The following individual is entitled to preside as chair at a meeting of
directors:
(1) the chair of the board, if any;
(2) in the absence of the chair of the board, the president, if any, if the
president is a director; or
(3) any other director chosen by the directors if:
(a) neither the chair of the board nor the president, if a director, is
present at the meeting within 15 minutes after the time set for
holding the meeting;
(b) neither the chair of the board nor the president, if a director, is
willing to chair the meeting; or
(c) the chair of the board and the president, if a director, have
advised the secretary, if any, or any other director, that they will
not be present at the meeting.
18.4 MEETINGS BY TELEPHONE OR OTHER COMMUNICATIONS MEDIUM
A director may participate in a meeting of the directors or of any committee of
the directors in person or by telephone if all directors participating in the
meeting, whether in person or by telephone or other communications medium, are
able to communicate with each other. A director may participate in a meeting of
the directors or of any committee of the directors by a communications medium
other than telephone if all directors participating in the meeting, whether in
person or by telephone or other communications medium, are able to communicate
with each other and if all directors who wish to participate in the meeting
agree to such participation. A director who participates in a meeting in a
manner contemplated by this Article 18.4 is deemed for all purposes of the
Business Corporations Act and these Articles to be present at the meeting and to
have agreed to participate in that manner.
18.5 CALLING OF MEETINGS
A director may, and the secretary or an assistant secretary of the Company, if
any, on the request of a director must, call a meeting of the directors at any
time.
18.6 NOTICE OF MEETINGS
Other than for meetings held at regular intervals as determined by the directors
pursuant to Article 18.1, reasonable notice of each meeting of the directors,
specifying the place, day and time of that meeting must be given to each of the
directors and the alternate directors by any method set out in Article 24.1 or
orally or by telephone.
-27-
18.7 WHEN NOTICE NOT REQUIRED
It is not necessary to give notice of a meeting of the directors to a director
or an alternate director if:
(1) the meeting is to be held immediately following a meeting of shareholders
at which that director was elected or appointed, or is the meeting of the
directors at which that director is appointed; or
(2) the director or alternate director, as the case may be, has waived notice
of the meeting.
18.8 MEETING VALID DESPITE FAILURE TO GIVE NOTICE
The accidental omission to give notice of any meeting of directors to, or the
non-receipt of any notice by, any director or alternate director, does not
invalidate any proceedings at that meeting.
18.9 WAIVER OF NOTICE OF MEETINGS
Any director or alternate director may send to the Company a document signed by
him or her waiving notice of any past, present or future meeting or meetings of
the directors and may at any time withdraw that waiver with respect to meetings
held after that withdrawal. After sending a waiver with respect to all future
meetings and until that waiver is withdrawn, no notice of any meeting of the
directors need be given to that director and, unless the director otherwise
requires by notice in writing to the Company, to his or her alternate director,
and all meetings of the directors so held are deemed not to be improperly called
or constituted by reason of notice not having been given to such director or
alternate director.
18.10 QUORUM
The quorum necessary for the transaction of the business of the directors may be
set by the directors and, if not so set, is deemed to be set at a majority of
the directors in office or, if the number of directors is set at one, is deemed
to be set at one director, and that director may constitute a meeting.
18.11 VALIDITY OF ACTS WHERE APPOINTMENT DEFECTIVE
Subject to the Business Corporations Act, an act of a director or officer is not
invalid merely because of an irregularity in the election or appointment or a
defect in the qualification of that director or officer.
18.12 CONSENT RESOLUTIONS IN WRITING
A resolution of the directors or of any committee of the directors consented to
in writing by all of the directors entitled to vote on it, whether by signed
document, fax, email or any other method of transmitting legibly recorded
messages, is as valid and effective as if it had been passed at a meeting of the
directors or of the committee of the directors duly called and held. Such
resolution may be in two or more counterparts which together are deemed to
constitute one resolution in writing. A resolution passed in that manner is
effective on the date stated in the
-28-
resolution or on the latest date stated on any counterpart. A resolution of the
directors or of any committee of the directors passed in accordance with this
Article 18.12 is deemed to be a proceeding at a meeting of directors or of the
committee of the directors and to be as valid and effective as if it had been
passed at a meeting of the directors or of the committee of the directors that
satisfies all the requirements of the Business Corporations Act and all the
requirements of these Articles relating to meetings of the directors or of a
committee of the directors.
19. EXECUTIVE AND OTHER COMMITTEES
19.1 APPOINTMENT AND POWERS OF EXECUTIVE COMMITTEE
The directors may, by resolution, appoint an executive committee consisting of
the director or directors that they consider appropriate, and this committee
has, during the intervals between meetings of the board of directors, all of the
directors' powers, except:
(1) the power to fill vacancies in the board of directors;
(2) the power to remove a director;
(3) the power to change the membership of, or fill vacancies in, any committee
of the directors; and
(4) such other powers, if any, as may be set out in the resolution or any
subsequent directors' resolution.
19.2 APPOINTMENT AND POWERS OF OTHER COMMITTEES
The directors may, by resolution:
(1) appoint one or more committees (other than the executive committee)
consisting of the director or directors that they consider appropriate;
(2) delegate to a committee appointed under paragraph (1) any of the
directors' powers, except:
(a) the power to fill vacancies in the board of directors;
(b) the power to remove a director;
(c) the power to change the membership of, or fill vacancies in, any
committee of the directors; and
(d) the power to appoint or remove officers appointed by the directors;
and
(3) make any delegation referred to in paragraph (2) subject to the conditions
set out in the resolution or any subsequent directors' resolution.
-29-
19.3 OBLIGATIONS OF COMMITTEES
Any committee appointed under Articles 19.1 or 19.2, in the exercise of the
powers delegated to it, must:
(1) conform to any rules that may from time to time be imposed on it by the
directors; and
(2) report every act or thing done in exercise of those powers at such times
as the directors may require.
19.4 POWERS OF BOARD
The directors may, at any time, with respect to a committee appointed under
Articles 19.1 or 19.2:
(1) revoke or alter the authority given to the committee, or override a
decision made by the committee, except as to acts done before such
revocation, alteration or overriding;
(2) terminate the appointment of, or change the membership of, the committee;
and
(3) fill vacancies in the committee.
19.5 COMMITTEE MEETINGS
Subject to Article 19.3(1) and unless the directors otherwise provide in the
resolution appointing the committee or in any subsequent resolution, with
respect to a committee appointed under Articles 19.1 or 19.2:
(1) the committee may meet and adjourn as it thinks proper;
(2) the committee may elect a chair of its meetings but, if no chair of a
meeting is elected, or if at a meeting the chair of the meeting is not
present within 15 minutes after the time set for holding the meeting, the
directors present who are members of the committee may choose one of their
number to chair the meeting;
(3) a majority of the members of the committee constitutes a quorum of the
committee; and
(4) questions arising at any meeting of the committee are determined by a
majority of votes of the members present, and in case of an equality of
votes, the chair of the meeting does not have a second or casting vote.
20. OFFICERS
20.1 DIRECTORS MAY APPOINT OFFICERS
The directors may, from time to time, appoint such officers, if any, as the
directors determine and the directors may, at any time, terminate any such
appointment.
-30-
20.2 FUNCTIONS, DUTIES AND POWERS OF OFFICERS
The directors may, for each officer:
(1) determine the functions and duties of the officer;
(2) entrust to and confer on the officer any of the powers exercisable by the
directors on such terms and conditions and with such restrictions as the
directors think fit; and
(3) revoke, withdraw, alter or vary all or any of the functions, duties and
powers of the officer.
20.3 QUALIFICATIONS
No officer may be appointed unless that officer is qualified in accordance with
the Business Corporations Act. One person may hold more than one position as an
officer of the Company. Any person appointed as the chair of the board or as the
managing director must be a director. Any other officer need not be a director.
20.4 REMUNERATION AND TERMS OF APPOINTMENT
All appointments of officers are to be made on the terms and conditions and at
the remuneration (whether by way of salary, fee, commission, participation in
profits or otherwise) that the directors thinks fit and are subject to
termination at the pleasure of the directors, and an officer may in addition to
such remuneration be entitled to receive, after he or she ceases to hold such
office or leaves the employment of the Company, a pension or gratuity.
21. INDEMNIFICATION
21.1 DEFINITIONS
In this Article 21:
(1) "eligible penalty" means a judgment, penalty or fine awarded or imposed
in, or an amount paid in settlement of, an eligible proceeding;
(2) "eligible proceeding" means a legal proceeding or investigative action,
whether current, threatened, pending or completed, in which a director,
former director or alternate director of the Company (an "eligible party")
or any of the heirs and legal personal representatives of the eligible
party, by reason of the eligible party being or having been a director or
alternate director of the Company:
(a) is or may be joined as a party; or
(b) is or may be liable for or in respect of a judgment, penalty or fine
in, or expenses related to, the proceeding;
(3) "expenses" has the meaning set out in the Business Corporations Act.
-31-
21.2 MANDATORY INDEMNIFICATION OF DIRECTORS AND FORMER DIRECTORS
Subject to the Business Corporations Act, the Company must indemnify a director,
former director or alternate director of the Company and his or her heirs and
legal personal representatives against all eligible penalties to which such
person is or may be liable, and the Company must, after the final disposition of
an eligible proceeding, pay the expenses actually and reasonably incurred by
such person in respect of that proceeding. Each director and alternate director
is deemed to have contracted with the Company on the terms of the indemnity
contained in this Article 21.2.
21.3 INDEMNIFICATION OF OTHER PERSONS
Subject to any restrictions in the Business Corporations Act, the Company may
indemnify any person.
21.4 NON-COMPLIANCE WITH BUSINESS CORPORATIONS ACT
The failure of a director, alternate director or officer of the Company to
comply with the Business Corporations Act or these Articles does not invalidate
any indemnity to which he or she is entitled under this Part.
21.5 COMPANY MAY PURCHASE INSURANCE
The Company may purchase and maintain insurance for the benefit of any person
(or his or her heirs or legal personal representatives) who:
(1) is or was a director, alternate director, officer, employee or agent of
the Company;
(2) is or was a director, alternate director, officer, employee or agent of a
corporation at a time when the corporation is or was an affiliate of the
Company;
(3) at the request of the Company, is or was a director, alternate director,
officer, employee or agent of a corporation or of a partnership, trust,
joint venture or other unincorporated entity;
(4) at the request of the Company, holds or held a position equivalent to that
of a director, alternate director or officer of a partnership, trust,
joint venture or other unincorporated entity;
against any liability incurred by him or her as such director, alternate
director, officer, employee or agent or person who holds or held such equivalent
position.
22. DIVIDENDS AND RESERVES
22.1 PAYMENT OF DIVIDENDS SUBJECT TO SPECIAL RIGHTS
The provisions of this Article 22 are subject to the rights, if any, of
shareholders holding shares with special rights as to dividends.
-32-
22.2 DECLARATION OF DIVIDENDS
Subject to the Business Corporations Act, the directors may from time to time
declare and authorize payment of such dividends as they may deem advisable.
22.3 NO NOTICE REQUIRED
The directors need not give notice to any shareholder of any declaration under
Article 22.2.
22.4 RECORD DATE
The directors may set a date as the record date for the purpose of determining
shareholders entitled to receive payment of a dividend. The record date must not
precede the date on which the dividend is to be paid by more than two months. If
no record date is set, the record date is 5 p.m. on the date on which the
directors pass the resolution declaring the dividend.
22.5 MANNER OF PAYING DIVIDEND
A resolution declaring a dividend may direct payment of the dividend wholly or
partly by the distribution of specific assets or of fully paid shares or of
bonds, debentures or other securities of the Company, or in any one or more of
those ways.
22.6 SETTLEMENT OF DIFFICULTIES
If any difficulty arises in regard to a distribution under Article 22.5, the
directors may settle the difficulty as they deem advisable, and, in particular,
may:
(1) set the value for distribution of specific assets;
(2) determine that cash payments in substitution for all or any part of the
specific assets to which any shareholders are entitled may be made to any
shareholders on the basis of the value so fixed in order to adjust the
rights of all parties; and
(3) vest any such specific assets in trustees for the persons entitled to the
dividend.
22.7 WHEN DIVIDEND PAYABLE
Any dividend may be made payable on such date as is fixed by the directors.
22.8 DIVIDENDS TO BE PAID IN ACCORDANCE WITH NUMBER OF SHARES
All dividends on shares of any class or series of shares must be declared and
paid according to the number of such shares held.
22.9 RECEIPT BY JOINT SHAREHOLDERS
If several persons are joint shareholders of any share, any one of them may give
an effective receipt for any dividend, bonus or other money payable in respect
of the share.
-33-
22.10 DIVIDEND BEARS NO INTEREST
No dividend bears interest against the Company.
22.11 FRACTIONAL DIVIDENDS
If a dividend to which a shareholder is entitled includes a fraction of the
smallest monetary unit of the currency of the dividend, that fraction may be
disregarded in making payment of the dividend and that payment represents full
payment of the dividend.
22.12 PAYMENT OF DIVIDENDS
Any dividend or other distribution payable in cash in respect of shares may be
paid by cheque, made payable to the order of the person to whom it is sent, and
mailed to the address of the shareholder, or in the case of joint shareholders,
to the address of the joint shareholder who is first named on the central
securities register, or to the person and to the address the shareholder or
joint shareholders may direct in writing. The mailing of such cheque will, to
the extent of the sum represented by the cheque (plus the amount of the tax
required by law to be deducted), discharge all liability for the dividend unless
such cheque is not paid on presentation or the amount of tax so deducted is not
paid to the appropriate taxing authority.
22.13 CAPITALIZATION OF SURPLUS
Notwithstanding anything contained in these Articles, the directors may from
time to time capitalize any surplus of the Company and may from time to time
issue, as fully paid, shares or any bonds, debentures or other securities of the
Company as a dividend representing the surplus or any part of the surplus.
23. DOCUMENTS, RECORDS AND REPORTS
23.1 RECORDING OF FINANCIAL AFFAIRS
The directors must cause adequate accounting records to be kept to record
properly the financial affairs and condition of the Company and to comply with
the Business Corporations Act.
23.2 INSPECTION OF ACCOUNTING RECORDS
Unless the directors determine otherwise, or unless otherwise determined by
ordinary resolution, no shareholder of the Company is entitled to inspect or
obtain a copy of any accounting records of the Company.
24. NOTICES
24.1 METHOD OF GIVING NOTICE
Unless the Business Corporations Act or these Articles provides otherwise, a
notice, statement, report or other record required or permitted by the Business
Corporations Act or these Articles to be sent by or to a person may be sent by
any one of the following methods:
-34-
(1) mail addressed to the person at the applicable address for that person as
follows:
(a) for a record mailed to a shareholder, the shareholder's registered
address;
(b) for a record mailed to a director or officer, the prescribed address
for mailing shown for the director or officer in the records kept by
the Company or the mailing address provided by the recipient for the
sending of that record or records of that class;
(c) in any other case, the mailing address of the intended recipient;
(2) delivery at the applicable address for that person as follows, addressed
to the person:
(a) for a record delivered to a shareholder, the shareholder's
registered address;
(b) for a record delivered to a director or officer, the prescribed
address for delivery shown for the director or officer in the
records kept by the Company or the delivery address provided by the
recipient for the sending of that record or records of that class;
(c) in any other case, the delivery address of the intended recipient;
(3) sending the record by fax to the fax number provided by the intended
recipient for the sending of that record or records of that class;
(4) sending the record by email to the email address provided by the intended
recipient for the sending of that record or records of that class;
(5) physical delivery to the intended recipient.
24.2 DEEMED RECEIPT OF MAILING
A record that is mailed to a person by ordinary mail to the applicable address
for that person referred to in Article 24.1 is deemed to be received by the
person to whom it was mailed on the day, Saturdays, Sundays and holidays
excepted, following the date of mailing.
24.3 CERTIFICATE OF SENDING
A certificate signed by the secretary, if any, or other officer of the Company
or of any other corporation acting in that behalf for the Company stating that a
notice, statement, report or other record was addressed as required by Article
24.1, prepaid and mailed or otherwise sent as permitted by Article 24.1 is
conclusive evidence of that fact.
24.4 NOTICE TO JOINT SHAREHOLDERS
A notice, statement, report or other record may be provided by the Company to
the joint shareholders of a share by providing the notice to the joint
shareholder first named in the central securities register in respect of the
share.
-35-
24.5 NOTICE TO TRUSTEES
A notice, statement, report or other record may be provided by the Company to
the persons entitled to a share in consequence of the death, bankruptcy or
incapacity of a shareholder by:
(1) mailing the record, addressed to them:
(a) by name, by the title of the legal personal representative of the
deceased or incapacitated shareholder, by the title of trustee of
the bankrupt shareholder or by any similar description; and
(b) at the address, if any, supplied to the Company for that purpose by
the persons claiming to be so entitled; or
(2) if an address referred to in paragraph (1)(b) has not been supplied to the
Company, by giving the notice in a manner in which it might have been
given if the death, bankruptcy or incapacity had not occurred.
25. SEAL
25.1 WHO MAY ATTEST SEAL
Except as provided in Articles 25.2 and 25.3, the Company's seal, if any, must
not be impressed on any record except when that impression is attested by the
signatures of:
(1) any two directors;
(2) any officer, together with any director;
(3) if the Company only has one director, that director; or
(4) any one or more directors or officers or persons as may be determined by
the directors.
25.2 SEALING COPIES
For the purpose of certifying under seal a certificate of incumbency of the
directors or officers of the Company or a true copy of any resolution or other
document, despite Article 25.1, the impression of the seal may be attested by
the signature of any director or officer.
25.3 MECHANICAL REPRODUCTION OF SEAL
The directors may authorize the seal to be impressed by third parties on share
certificates or bonds, debentures or other securities of the Company as they may
determine appropriate from time to time. To enable the seal to be impressed on
any share certificates or bonds, debentures or other securities of the Company,
whether in definitive or interim form, on which facsimiles of any of the
signatures of the directors or officers of the Company are, in accordance with
the Business Corporations Act or these Articles, printed or otherwise
mechanically reproduced, there may be delivered to the person employed to
engrave, lithograph or print such definitive or interim share certificates or
bonds, debentures or other securities one or more unmounted dies
-36-
reproducing the seal and the chair of the board or any senior officer together
with the secretary, treasurer, secretary-treasurer, an assistant secretary, an
assistant treasurer or an assistant secretary-treasurer may in writing authorize
such person to cause the seal to be impressed on such definitive or interim
share certificates or bonds, debentures or other securities by the use of such
dies. Share certificates or bonds, debentures or other securities to which the
seal has been so impressed are for all purposes deemed to be under and to bear
the seal impressed on them.
26. PROHIBITIONS
26.1 DEFINITIONS
In this Article 26:
(1) "designated security" means:
(a) a voting security of the Company;
(b) a security of the Company that is not a debt security and that
carries a residual right to participate in the earnings of the
Company or, on the liquidation or winding up of the Company, in its
assets; or
(c) a security of the Company convertible, directly or indirectly, into
a security described in paragraph (a) or (b);
(2) "security" has the meaning assigned in the Securities Act (British
Columbia);
(3) "voting security" means a security of the Company that:
(a) is not a debt security, and
(b) carries a voting right either under all circumstances or under some
circumstances that have occurred and are continuing.
26.2 APPLICATION
Article 26.3 does not apply to the Company if and for so long as it is a public
company or a pre-existing reporting company which has the Statutory Reporting
Company Provisions as part of its Articles or to which the Statutory Reporting
Company Provisions apply.
-37-