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Exhibit 3.18
BY-LAW NO. 1
a by-law relating generally to the
transaction of the business and
affairs of
GREY WOLF EXPLORATION INC.
(the "Corporation")
1 - INTERPRETATION
1.1 DEFINITIONS - In this by-law and all other by-laws of the Corporation,
unless the context requires otherwise:
(a) "the Act" means the Business Corporations Act (Alberta), or any
statute which may be substituted therefor, including the regulations
made thereunder as amended from time to time;
(b) "articles" means the original or restated articles of incorporation,
articles of amendment, articles of amalgamation, articles of
arrangement, articles of continuance, articles of dissolution,
articles of reorganization, articles of revival, letters patent,
supplementary letters patent, a special Act and any other instrument
by which the Corporation is incorporated;
(c) "board" means the board of directors of the Corporation; and
"director" means a member of the board;
(d) "meeting of shareholders" means an annual meeting of shareholders or a
special meeting of shareholders;
(e) "non-business day" means Saturday, Sunday and any other day that is a
holiday as defined in the Interpretation Act (Alberta);
(f) "person" includes an individual, sole proprietorship, partnership,
unincorporated association, unincorporated syndicate, unincorporated
organization, trust, body corporate, and a natural person in the
capacity of trustee, executor, administrator, or other legal
representative;
(g) "resident Canadian" means a Canadian citizen ordinarily resident in
Canada or as otherwise defined in the Act;
(h) "unanimous shareholder agreement" means a written agreement among all
the shareholders of the Corporation, or among all such shareholders
and one or more persons who are not shareholders, or a written
declaration by a person who is the beneficial owner of all the issued
shares of the Corporation, that restricts, in whole or in part, the
powers of the directors to manage or supervise the management of the
business and affairs of the Corporation, as may be from time to time
amended;
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(i) words importing the singular number also include the plural and
vice-versa; words importing a particular gender include all genders;
(j) all words used in this by-law and defined in the Act shall have the
meanings given to such words in the Act or in the related Parts
thereof.
1.2 EXECUTION IN COUNTERPART - Any articles, notice, resolution,
requisition, statement or other document required or permitted to be executed by
more than one person for the purposes of the Act may be executed in several
documents of like form each of which is executed by one or more of such persons,
and such documents, when duly executed by all persons required or permitted, as
the case may be, to do so, shall be deemed to constitute one document for the
purposes of the Act.
2 - GENERAL BUSINESS
2.1 REGISTERED OFFICE - The registered office of the Corporation shall be
in the municipality or geographical township within Alberta as the board may
from time to time determine.
2.2 SEAL - The Corporation may have a seal which shall be adopted and may
be changed by the board.
2.3 FINANCIAL YEAR - The financial year of the Corporation shall be
determined by the board from time to time.
2.4 EXECUTION OF INSTRUMENTS - Deeds, transfers, assignments, contracts,
obligations, certificates and other instruments shall be signed on behalf of the
Corporation by two persons,
(a) one of whom holds the office of chairman of the board, president,
managing director or vice-president or is a director, and
(b) 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 or is
a director.
In addition, the board may from time to time direct the manner in which and the
person or persons by whom any particular instrument or class of instruments may
or shall be signed.
The secretary or any other officer or any director may sign certificates and
similar instruments (other than share certificates) on the Corporation's behalf
with respect to any factual matters relating to the Corporation's business and
affairs, including certificates verifying copies of the articles, by-laws,
resolutions and minutes of meetings of the Corporation.
2.5 BANKING ARRANGEMENTS. The banking business of the Corporation, or any
part thereof, shall be transacted with such bank, trust company or other firm or
body corporate as the board may designate, appoint or authorize from time to
time and all such banking business, or any part thereof, shall be transacted on
the Corporation's behalf by such one or more officers or other persons as the
board may designate, direct or authorize from time to time and to the extent
thereby provided.
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3 - BORROWING
3.1 BORROWING - Without limit to the powers of the board as provided in
the Act, the board may from time to time on behalf of the Corporation:
(a) borrow money upon the credit of the Corporation;
(b) issue, reissue, sell or pledge debt obligations of the Corporation;
(c) to the extent permitted by the Act, give, directly or indirectly,
financial assistance to any person by means of a loan, a guarantee or
otherwise to secure the performance of an obligation; and
(d) mortgage, hypothecate, pledge or otherwise create a security interest
in all or any property of the Corporation, owned or subsequently
acquired, to secure any obligation of the Corporation.
3.2 DELEGATION - Subject to the Act, the articles, the by-laws and any
unanimous shareholder agreement, the board may from time to time delegate to a
director, a committee of directors or an officer of the Corporation or such
other person or persons so designated by the board all or any of the powers
conferred on the board by section 3.1 or by the Act to such extent and in such
manner as the board shall determine at the time of each such delegation.
4 - DIRECTORS
4.1 DUTIES OF DIRECTORS - Subject to any unanimous shareholder agreement,
the board shall manage or supervise the management of the business and affairs
of the Corporation.
4.2 QUALIFICATIONS OF DIRECTORS - No person shall be elected or appointed
a director if that person is less than 18 years of age, of unsound mind and has
been so found by a court in Canada elsewhere, is not an individual, or has the
status of bankrupt. A director need not hold shares issued by the Corporation
4.3 NUMBER OF DIRECTORS - The board shall consist of such number of
directors as shall be set out in the articles or as may from time to time be
determined in accordance with the Act. Where the board is empowered by special
resolution to determine the number of directors within a range set out in the
articles:
(a) the directors may appoint additional directors provided that after
such appointment the total number of directors would not be greater
than one and one-third times the number of directors required to have
been elected at the last annual meeting nor greater than the maximum
number set out above; and
(b) the number of directors to be elected at the annual meeting shall be
the number of directors last determined by the board.
4.4 CONSENT TO ACT - A person who is elected or appointed a director is
not a director unless:
(a) he was present at the meeting when he was elected or appointed and did
not refuse to act as a director, or
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(b) if he was not present at the meeting when he was elected or appointed,
(i) he consented to act as a director in writing before his
election or appointment or within 10 days after it, or
(ii) he has acted as a director pursuant to the election or
appointment.
4.5 QUORUM - A majority of the number as determined from time to time in
accordance with the Act shall constitute a quorum for the transaction of
business. Where the Corporation has fewer than three directors, all directors
must be present at any meeting to constitute a quorum for the transaction of
business. Notwithstanding vacancies, a quorum of directors may exercise all the
powers of the board.
4.6 ELECTION AND TERM - Directors shall be elected by the shareholders at
the first meeting of shareholders after the effective date of this by-law and at
each succeeding annual meeting at which an election of directors is required and
shall hold office until the next annual meeting of shareholders or, if elected
for an expressly stated term, for a term expiring not later than the close of
the third annual meeting of shareholders following the election. The number of
directors to be elected at any such meeting shall be that number most recently
determined in the manner referred to in section 4.3. The election need not be by
ballot unless a ballot is demanded by any shareholder or required by the
chairman in accordance with section 8.17. If an election of directors is not
held at an annual meeting of shareholders at which such election is required,
the incumbent directors shall continue in office until their successors are
elected.
4.7 REMOVAL OF DIRECTORS - Subject to the provisions of the Act, the
shareholders may, by ordinary resolution passed by a majority of the votes cast
at a meeting of shareholders, remove any director and may at that meeting elect
a qualified person in place of that director for the unexpired
4.8 CEASING TO HOLD OFFICE - A director may resign as director by
delivering a written resignation to the Corporation and such resignation becomes
effective at the time the resignation is received by the Corporation or the time
specified in the resignation whichever is later. A director shall forthwith
cease to hold office as a director should the director cease to be qualified in
accordance with the Act. Any attempt to amend or terminate any unanimous
shareholder agreement without written consent of all persons who are then
directors of the Corporation shall constitute the immediately effective
resignation of all such directors who have not so consented.
4.9 VACANCIES - Subject to the Act, whenever the board has fewer than the
number of members elected, the directors then in office, if constituting a
quorum (and notwithstanding that the majority of such directors are not resident
Canadians), may appoint a qualified person to the board to hold office for a
term expiring at the close of the next annual meeting of shareholders. Whenever
a vacancy shall occur on the board which results in the board not having a
quorum, the remaining directors shall forthwith call a special meeting of
shareholders to fill the vacancy. If the board fails to call such meeting or if
there are no such directors then in office, any shareholder may call the
meeting. Where the number or the minimum number of directors is increased, any
vacancy resulting from such increase shall be filled by election at a special
meeting of shareholders.
4.10 ACTION BY THE BOARD - Subject to any unanimous shareholder agreement,
the board shall exercise its powers by or pursuant to a by-law or resolution
either passed at a meeting of directors at which a quorum is present and at
which a majority of the directors present are resident Canadians or consented to
by the signatures of all the directors then in office if constituting a quorum.
Where a corporation has fewer than three directors, one of the directors present
at a meeting
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of directors shall be a resident Canadian. Subject to the Act, the board may
transact business at a meeting of directors where a majority of resident
Canadian directors is not present if a resident Canadian director who is unable
to be present approves in writing or by telephone or other communications
facilities the business transacted at the meeting, and a majority of resident
Canadian directors would have been present had that director been present at the
meeting. Where the Corporation has only one director, that director may
constitute a meeting.
4.11 ACTION IN WRITING - A resolution in writing, signed by all the
directors entitled to vote on that resolution at a meeting of directors or a
committee of directors, is as valid as if it had been passed at a meeting of
directors or a committee of directors.
4.12 MEETINGS BY TELEPHONE - Any director may participate in a meeting of
the board by means of such telephone, electronic, or other communication
facilities as permit all persons participating in the meeting to communicate
with each other simultaneously and instantaneously, if all the directors present
at or participating in the meeting consent to the holding of meetings in such
manner.
4.13 PLACE OF MEETINGS - Meetings of the board may be held at the
registered office of the Corporation or at any other place within or outside
Alberta.
4.14 CALLING OF MEETINGS - Meetings of the board shall be held from time to
time at such place, on such day and at such time as the board, the chairman of
the board, the managing director, the president, the secretary or any two
directors may determine.
4.15 NOTICE OF MEETINGS - Notice of the time and place of each meeting of
the board shall be given to each director not less than 24 hours before the time
when the meeting is to be held and need not be in writing.
4.16 FIRST MEETING OF NEW BOARD - Provided a quorum of directors is
present, each newly elected board may without notice hold its first meeting
following the meeting of shareholders at which such board is elected.
4.17 ADJOURNED MEETING - Notice of an adjourned meeting of the directors is
not required if the time and place of the adjourned meeting is announced at the
original meeting.
4.18 REGULAR MEETINGS - The board may appoint a day or days in any month or
months for regular meetings at a place and hour to be named. A copy of any
resolution by the board fixing the time and place of regular meetings of the
board shall be sent to each director forthwith after being passed, but no other
notice shall be required for any such regular meeting.
4.19 VOTES TO GOVERN - At all meetings of the board any question shall be
decided by a majority of the votes cast on the question and in the case of an
equality of votes the chairman of the meeting shall not be entitled to a second
or casting vote. Any question at a meeting of the board shall be decided by a
show of hands unless a ballot is required or demanded.
4.20 CHAIRMAN AND SECRETARY - The chairman of the board or, in the absence
of the chairman, the president if a director or, in the absence of the
president, a vice-president who is a director shall be chairman of any meeting
of the board. If none of the said officers is present, the directors present
shall choose one of their number to be chairman. The secretary of the
Corporation shall act as secretary at any meeting of the board and, if the
secretary of the Corporation be absent,
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the chairman of the meeting shall appoint a person who need not be a director to
act as secretary of the meeting.
4.21 REMUNERATION AND EXPENSES - Subject to any unanimous shareholder
agreement, the directors shall be paid such remuneration for their services as
directors as the board may from time to time authorize. The directors shall also
be entitled to be paid in respect of travelling and other expenses properly
incurred by them in attending meetings of the board or any committee thereof or
in otherwise serving the Corporation. Nothing herein contained shall preclude
any director from serving the Corporation in any other capacity and receiving
remuneration therefor.
4.22 CONFLICT OF INTEREST - Subject to and in accordance with the
provisions of the Act, a director or officer of the Corporation who is a party
to a material contract or transaction or proposed material contract or
transaction with the Corporation, or is a director or an officer of or has a
material interest in any person who is a party to a material contract or
transaction or proposed material contract or transaction with the Corporation,
shall disclose in writing to the Corporation or request to have entered in the
minutes of meetings of directors the nature and extent of such interest, and any
such director shall refrain from voting in respect thereof unless otherwise
permitted by the Act.
5 - COMMITTEES
5.1 COMMITTEES OF DIRECTORS - The board may appoint, from their number, a
committee or committees of directors, however designated, and delegate to such
committee or committees any of the powers of the board except powers to:
(a) submit to the shareholders any question or matter requiring the
approval of the shareholders;
(b) fill a vacancy among the directors or in the office of auditor;
(c) issue securities except in the manner and on the terms authorized by
the directors;
(d) declare dividends;
(e) purchase, redeem or otherwise acquire shares issued by the
Corporation, except in the manner and on the terms authorized by the
directors;
(f) pay a commission for the sale of shares of the Corporation;
(g) approve a management proxy circular;
(h) approve any annual financial statements; or
(i) adopt, amend or repeal by-laws.
At least half of the members of any such committee shall be resident Canadians.
5.2 TRANSACTION OF BUSINESS - The powers of a 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. Meetings of such
committee may be held at any place in or outside Alberta and, subject
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to the provisions of section 4.12 which shall be applicable mutatis mutandis,
may be held by means of telephone or other communications equipment.
5.3 PROCEDURE - Unless otherwise determined by the board, each committee
shall have the power to fix its quorum at not less than a majority of its
members, to elect its chairman and to regulate its procedure.
6 - OFFICERS
6.1 APPOINTMENT OF OFFICERS - Subject to any unanimous shareholder
agreement, the board may from time to time appoint a chairman of the board, a
managing director (who shall be a resident Canadian), a president, one or more
vice-presidents, a secretary, a treasurer and such other officers as the board
may determine, including one or more assistants to any of the officers so
appointed. The board may specify the duties of such officers and, in accordance
with this bylaw and subject to the provisions of the Act, delegate to such
officers powers to manage the business and affairs of the Corporation other than
any of the powers listed in section 5.1. Except for a managing director and a
chairman of the board, an officer need not be a director and one person may hold
more than one office. The president or such other officer as the board may
designate shall be the chief executive officer of the Corporation.
6.2 AGENTS AND ATTORNEYS -The board shall have the power from time to time
to appoint agents or attorneys for the Corporation in or out of Alberta with
such powers of management or otherwise (including the power to sub-delegate) as
the board may determine.
6.3 CONFLICT OF INTEREST - An officer shall disclose an interest in any
material contract or transaction or proposed material contract or transaction
with the Corporation in accordance with section 4.22.
7 - PROTECTION OF DIRECTORS AND OFFICERS
7.1 INDEMNITY OF DIRECTORS AND OFFICERS - Subject to section 119 of the
Act, the Corporation shall indemnify a director or officer of the Corporation, a
former director or officer of the Corporation or 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 the heirs and legal
representatives of any such person, against all costs, charges and expenses,
including an amount paid to settle an action or satisfy a judgment, reasonably
incurred by such person in respect of any civil, criminal or administrative
action or proceeding to which the person is made a party by reason of being or
having been a director or officer of such corporation or body corporate, if
(a) the person acted honestly and in good faith with a view to the best
interests of the Corporation; and
(b) in the case of a criminal or administrative action or proceeding that
is enforced by a monetary penalty, the person had reasonable grounds
for believing that the relevant conduct was lawful.
The Corporation may, with the approval of the court, indemnify a person referred
to above in respect of an action by or on behalf of the Corporation or body
corporate to procure a judgment in its favour, to which the person is made a
party by reason of being or having been a director or an officer of the
Corporation or body corporate, against all costs, charges and expenses
reasonably incurred by that person in connection with such action if the person
fulfills the conditions set out in (a) and (b) above.
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Notwithstanding anything in this section, a person referred to above is entitled
to indemnity from the Corporation in respect of all costs, charges and expenses
reasonably incurred by that person in connection with the defence of any civil,
criminal or administrative action or proceeding to which the person is made a
party by reason of being or having been a director or officer of the Corporation
or body corporate, if the person seeking indemnity,
(c) was substantially successful on the merits in that person's defence of
the action or proceeding;
(d) fulfills the conditions set out in (a) and (b) above; and
(e) is fairly and reasonably entitled to indemnity.
7.2 INSURANCE - Subject to the Act, the Corporation may purchase and
maintain insurance for the benefit of any person referred to above against any
liability incurred by that person,
(a) in the capacity as a director or officer of the Corporation, except
where the liability relates to that person's failure to act honestly
and in good faith with a view to the best interests of the
Corporation; or
(b) in the capacity as a director or officer of another body corporate
where said person acts or acted in that capacity at the Corporation's
request, except where the liability relates to that person's failure
to act honestly and in good faith with a view to the best interests of
the body corporate.
8 - MEETINGS OF SHAREHOLDERS
8.l ANNUAL MEETINGS - The annual meeting of shareholders shall be held on
such day and at such time in each year as the board, or the chairman of the
board, or the president, in the absence of the chairman of the board, may from
time to time determine, for the purpose of considering the financial statements
and reports required by the Act to be placed before the annual meeting, electing
directors, appointing auditors and the transaction of such other business as may
properly be brought before the meeting.
8.2 SPECIAL MEETINGS - The board shall have power to call a special
meeting of shareholders at any time.
8.3 RESOLUTION IN LIEU OF MEETING - Except where a written statement is
submitted by a director or where representations in writing are submitted by an
auditor in accordance with the provisions of the Act, a resolution in writing
signed by all the shareholders entitled to vote on that resolution at a meeting
of shareholders is as valid as if it had been passed at a meeting of the
shareholders; and a resolution in writing dealing with all matters required to
be dealt with at a meeting of shareholders, and signed by all the shareholders
entitled to vote at such meeting, satisfies all the requirements of the Act
relating to meetings of shareholders.
8.4 PLACE OF MEETINGS - Subject to the articles and any unanimous
shareholder agreement, a meeting of shareholders of the Corporation shall be
held at such place in or outside Alberta as the directors determine or, in the
absence of such a determination, at the place where the registered office of the
Corporation is located.
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8.5 NOTICES OF MEETINGS - Notice of the time and place of every meeting of
shareholders shall be sent not less than 21 days and not more than 50 days
before the meeting to each shareholder entitled to vote at the meeting, to each
director and to the auditor of the Corporation. Notice of a meeting of
shareholders at which special business is to be transacted shall state or be
accompanied by a statement of (I) the nature of that business in sufficient
detail to permit the shareholder to form a reasoned judgment thereon and (ii)
the text of any special resolution or by-law to be submitted to the meeting. All
business transacted at a special meeting of shareholders and all business
transacted at an annual meeting of shareholders, except consideration of the
minutes of an earlier meeting, the financial statements and auditor's report,
election of directors and reappointment of the incumbent auditor, is deemed to
be special business.
8.6 RECORD DATE FOR NOTICE - The board may fix in advance a record date,
preceding the date of any meeting of shareholders by not more than 50 days and
not less than 21 days, for the determination of the shareholders entitled to
notice of the meeting, provided that notice of any such record date is given,
not less than 7 days before such record date, by advertisement in a newspaper
published or distributed in the place where the Corporation has its registered
office and in each place in Canada where it has a transfer agent or where a
transfer of the Corporation's shares may be recorded, and, where applicable, by
written notice to each stock exchange in Canada on which the Corporation's
shares are listed for trading unless notice of the record date is waived in
writing by every holder of a share of the class or series affected whose name is
set out in the securities register of the Corporation at the close of business
on the day the directors fix the record date. If no record date is fixed the
record date for the determination of the shareholders entitled to notice of the
meeting shall be at the close of business on the day immediately preceding the
day on which the notice is given.
8.7 CHAIRMAN AND SECRETARY - The chairman of the board or, in the absence
of the chairman, the president or, in the absence of the president, a
vice-president shall be chairman of any meeting of shareholders and, if none of
the said officers be present within 15 minutes after the time appointed for
holding the meeting, the shareholders present and entitled to vote shall choose
a chairman from amongst themselves. The secretary of the Corporation shall act
as secretary at any meeting of shareholders or, if the secretary of the
Corporation be absent, the chairman of the meeting shall appoint some person,
who need not be a shareholder, to act as secretary of the meeting.
8.8 PERSONS ENTITLED TO BE PRESENT - The only persons entitled to be
present at a meeting of shareholders shall be those entitled to vote thereat,
the directors and auditors of the Corporation and others who, although not
entitled to vote, are entitled or required under any provision of the Act or the
articles or by-laws to be present at the meeting. Any other person may be
admitted only on the invitation of the chairman of the meeting or with the
consent of the meeting.
8.9 QUORUM - Subject to the Act or the articles or any other by-law of the
Corporation, a quorum of shareholders shall be persons present or represented by
proxy, not being less than two (2) in number and holding or representing not
less than five (5%)percent of the shares entitled to be voted at the meeting. A
quorum need not be present throughout the meeting provided that a quorum is
present at the opening of the meeting.
8.10 RIGHT TO VOTE - Each share of the Corporation entitles the holder of
it to one vote at a meeting of shareholders.
8.1l PROXIES AND REPRESENTATIVES - Every shareholder entitled to vote at a
meeting of shareholders may, by means of a proxy, appoint a proxyholder, and one
or more alternate proxyholders, who need not be shareholders, as that
shareholder's nominee, to attend and act at the meeting in the
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manner, to the extent, and with the authority conferred by the proxy. A proxy
shall be in writing executed by the shareholder or shareholder's attorney
authorized in writing. A body corporate or association which is a shareholder of
the Corporation may be represented at a meeting of shareholders by any
individual authorized by a resolution of its directors or governing body of the
body corporate or association and such individual may exercise on behalf of the
body corporate or association represented all the powers it could exercise if it
were an individual shareholder. In the case of a proxy appointing a proxyholder
to attend and act at a meeting or meetings of shareholders of an offering
corporation, the proxy ceases to be valid one year from its date.
8.12 TIME FOR DEPOSIT OF PROXIES - The directors may by resolution fix a
time not exceeding forty-eight hours, excluding non-business days, preceding any
meeting or adjourned meeting of shareholders before which time proxies to be
used at that meeting must be deposited with the Corporation or an agent thereof,
and any period of time so fixed shall be specified in the notice calling the
meeting. A proxy may be used at the meeting only if, prior to the time so
specified, it shall have been deposited with the Corporation or an agent thereof
specified in such notice or, if no such time is specified in such notice, it
shall have been received by the secretary of the Corporation or by the chairman
of the meeting or adjournment thereof prior to the time of voting.
8.13 JOINT SHAREHOLDERS - Where two or more persons hold the same shares
jointly, one of those holders present or represented by proxy at a meeting of
shareholders may in the absence of the other or others vote such shares, but, if
more than one of such persons are present or represented by proxy, that one of
such persons whose name stands first on the securities register of the
Corporation or that person's proxy shall alone be entitled to vote such shares.
8.14 VOTES TO GOVERN - Except as otherwise required by the Act, all
questions proposed for the consideration of shareholders at a meeting of
shareholders shall be determined by the majority of the votes cast, whether by a
show of hands or by ballot, as the case may be.
8.15 CASTING VOTE - In case of an equality of votes at any meeting of
shareholders either upon a show of hands or upon a ballot, the chairman of the
meeting shall not be entitled to a second or casting vote.
8.16 SHOW OF HANDS - Any question at a meeting of shareholders shall be
decided by a show of hands unless a ballot thereon is required or demanded as
hereinafter provided. Upon a show of hands every person who is present and
entitled to vote thereon shall have one vote. Whenever a vote by show of hands
shall have been taken upon a question, unless a ballot thereon is so 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 the 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.
8.17 BALLOTS - On any question proposed for consideration at a meeting of
shareholders, and whether or not a show of hands has been taken thereon, the
chairman may require, or any shareholder or proxyholder entitled to vote at the
meeting may demand, a ballot. A ballot so 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 the
person 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.
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8.18 ADJOURNMENT - If a meeting of shareholders is adjourned for less than
30 days, it shall not be necessary to give notice of the adjourned meeting,
other than by announcement at the earliest meeting that is adjourned. If a
meeting of shareholders is adjourned by one or more adjournments for an
aggregate of 30 days or more, notice of the adjourned meeting shall be given as
for an original meeting.
8.19 ONE SHAREHOLDER - Where the Corporation has only one shareholder or
only one holder of any class or series of shares, the shareholder present in
person or by proxy constitutes a meeting.
9 - SECURITIES
9.1 OPTIONS OR RIGHTS - Subject to the provisions of the Act, the articles
and any unanimous shareholder agreement, the board may from time to time issue
or grant options to purchase or rights to acquire unissued shares of the
Corporation at such times and to such persons and for such consideration as the
board shall determine, provided that no share shall be issued until it is fully
paid.
9.2 COMMISSIONS - The board may from time to time authorize the
Corporation to pay a reasonable commission to any person in consideration of
purchasing or agreeing to purchase shares of the Corporation, whether from the
Corporation or from any other person, or procuring or agreeing to procure
purchasers for any such shares.
9.3 SECURITIES RECORDS - The Corporation shall prepare and maintain, at
its registered office or at any other place in Alberta designated by the board,
a securities register in which it records the securities issued by it in
registered form, showing with respect to each class or series of securities:
(a) the names, alphabetically arranged, and the latest known address of
each person who is or has been a security holder;
(b) the number of shares or other securities held by each holder; and
(c) the date and particulars of the issue and transfer of each security.
9.4 REGISTER OF TRANSFER -The Corporation shall cause to be kept a
register of transfers in which all transfers of securities issued by the
Corporation in registered form and the date and other particulars of each
transfer shall be set out.
9.5 REGISTRATION OF TRANSFER - Subject to the provisions of the Act, no
transfer of shares shall be registered in a securities register except upon
presentation of the certificate representing such shares with a transfer
endorsed thereon or delivered therewith duly executed by the registered holder
or by the holder's attorney or successor duly appointed, together with such
reasonable assurance or evidence of signature, identification and authority to
transfer as the board may from time to time prescribe, upon payment of all
applicable taxes and any fees prescribed by the board or in accordance with the
Act upon compliance with such restrictions on transfer as are authorized by the
articles.
[9.6 HAS INTENTIONALLY BEEN LEFT OUT]
9.7 NON-RECOGNITION OF TRUSTS - Subject to the provisions of the Act, the
Corporation may treat the registered owner of a share as the person exclusively
entitled to vote, to receive notices, to receive any dividend or other payments
in respect thereof and otherwise to exercise all the rights and powers of an
owner of a share.
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9.8 SECURITY INSTRUMENTS - Every holder of one or more securities of the
Corporation shall be entitled, at the holder's option, to a security certificate
in respect of the securities held by that person or to a non-transferable
written acknowledgement of that person's right to obtain a security certificate,
stating the number and class or series of shares held by that person as SHOWN on
the securities register. Security certificates and acknowledgements of a
shareholder's right to a security certificate, respectively, shall be in such
form as the board may from time to time approve. Unless otherwise ordered by the
board, security certificates shall be signed by any one of-.
(a) the chairman of the board, the president, the managing director, a
vice-president or a director,
and any one of:
(b) the secretary, treasurer, any assistant secretary or any assistant
treasurer or a director
and need not be under corporate seal. Signatures of signing officers may be
printed or mechanically reproduced in facsimile upon security certificates and
every such facsimile shall for all purposes be deemed to be the signature of the
officer whose signature it reproduces and shall be binding upon the Corporation;
provided that at least one director or officer of the Corporation shall manually
sign each certificate (other than a scrip certificate or a certificate
representing a fractional share or a warrant or a promissory note that is not
issued under a trust indenture) in the absence of a manual signature thereon of
a duly appointed transfer agent, registrar, branch transfer agent or issuing or
other authenticating agent of the Corporation or trustee who certifies it in
accordance with a trust indenture. A security certificate executed as aforesaid
shall be valid notwithstanding that an officer whose facsimile signature appears
thereon no longer holds office at the date of issue of the certificate.
9.9 REPLACEMENT OF SECURITY CERTIFICATES - Subject to the provisions of
the Act, the board or any officer or agent designated by the board may in the
discretion of the board or that person direct the issue of a new security
certificate in lieu of and upon cancellation of a security certificate claimed
to have been lost, apparently destroyed or wrongfully taken on payment of such
fee, prescribed by or in accordance with the Act, and on such terms as to
indemnity, reimbursement of expenses and evidence of loss and of title as the
board may from time to time prescribe, whether generally or in any particular
case.
9.10 JOINT SHAREHOLDERS - If two or more persons are registered as joint
holders of any share, the Corporation shall not be bound to issue more than one
certificate in respect thereof, and delivery of such certificate to one of such
persons shall be sufficient delivery to all of them. Any one 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.
9.11 DECEASED SHAREHOLDERS - In the event of the death of a holder, or of
one of the joint holders, of any share, the Corporation shall not be required to
make any entry in the securities register in respect thereof or to make payment
of any dividends thereon except upon production of all such documents as may be
required by the Act and upon compliance with the reasonable requirements of the
Corporation or transfer agent.
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10 - DIVIDENDS AND RIGHTS
10.1 DIVIDENDS - Subject to the provisions of the Act, the articles and any
unanimous shareholder agreement, the board may from time to time declare
dividends payable to the shareholders according to their respective rights and
interests in the Corporation. Dividends may 'be paid in money or property or by
issuing fully paid shares or options or rights to acquire fully paid shares of
the Corporation.
10.2 DIVIDEND CHEQUES - A dividend payable in cash shall be paid by cheque
drawn on the Corporation's bankers or one of them 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
the address recorded in the Corporation's securities register, unless in each
case such holder otherwise directs. In the case of joint holders the cheque
shall, unless such joint holders otherwise direct, be made payable to the order
of all of such joint holders and, if more than one address is recorded in the
Corporation's security register in respect of such joint holding, the cheque
shall be mailed to the first address so appearing. 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.
10.3 NON-RECEIPT OR LOSS OF CHEQUES - In the event of non-receipt or loss
of any dividend cheque by the person to whom it is sent, 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.
10.4 RECORD DATE FOR DIVIDENDS AND RIGHTS - The board may fix in advance a
date as the record date for the determination of the shareholders entitled to
receive payment of a dividend, entitled to participate in a liquidation or
distribution, or for any other purpose except to receive notice of or to vote at
a meeting, but the record date shall not precede by more than 50 days the
particular action to be taken. Notice of the record date shall be given, not
less than 7 days before such record date, by advertisement in a newspaper
published or distributed in the place where the Corporation has its registered
office and in each place in Canada where it has a transfer agent or where a
transfer of the Corporation's shares may be recorded and, where applicable, by
written notice to each stock exchange in Canada on which the Corporation's
shares are listed for trading, unless notice of the record date is waived in
writing by every holder of a share of the class or series affected whose name is
set out in the securities register of the Corporation at the close of business
on the day the directors fix the record date. If no such record date is fixed,
such record date shall be the close of business on the day on which the
directors pass the resolutions relating thereto.
10.5 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.
11 - NOTICES
11.1 METHOD OF GIVING NOTICES - Any notice, communication or document
("notice") to be given or sent pursuant to the Act, the articles, the by-laws or
otherwise to or on a shareholder, director, officer, auditor or member of a
committee of the board shall be sufficiently given or sent if
<Page>
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given or sent by prepaid mail, prepaid transmitted or recorded communication, or
delivered personally to such persons' latest address as shown on the securities
register of the Corporation or, in the case of a director, if more current, the
address as shown in the most recent notice filed under the Act. A notice shall
be deemed to have been received on the date when it is delivered personally, or
if by mail, at the time it would be delivered in the ordinary course of mail, or
on the date of dispatch of a transmitted or recorded communication. The
secretary may change or cause to be changed the recorded address of any
shareholder, director, officer, auditor or member of a committee of the board in
accordance with any information believed by the secretary to be reliable.
11.2 NOTICE TO JOINT SHAREHOLDERS - If two or more persons are registered
as joint holders of any share, any notice shall be addressed to all of such
joint holders but notice to one of such persons shall be sufficient notice to
all of them.
11.3 COMPUTATION OF TIME - In computing the date when notice must be sent
under any provision requiring a specified period of days' notice of any meeting
or other event, the period of days shall commence on the day following the
sending of such notice and shall terminate on the day preceding the date of the
meeting or other event provided that the last day of the period shall not be a
non-business day.
11.4 UNDELIVERED NOTICES - If any notice given or sent to a shareholder
pursuant to section 11.1 is returned on three consecutive occasions because the
person cannot be found, the Corporation shall not be required to give or send
any further notice to such shareholder until the Corporation is informed in
writing of the new address for such person.
l1.5 OMISSIONS AND ERRORS - The accidental omission to give or send 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 based thereon.
11.6 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 or sent to the
shareholder from whom the person derives title to such share prior to that
person's name and address being entered on the securities register (whether such
notice was given or sent before or after the happening of the event upon which
that person becomes so entitled) and prior to that person furnishing to the
Corporation the proof of authority or evidence of entitlement prescribed by the
Act.
11.7 WAIVER OF NOTICE - Any shareholder (or shareholder's duly appointed
proxyholder), director, officer, auditor or member of a committee of the board
may at any time waive the giving or sending of any notice, or waive or abridge
the time for any notice, required to be given to that person under any provision
of the Act, the articles, the by-laws or otherwise and such waiver or
abridgement shall cure any default in the giving or sending or in the time of
such notice, as the case may be. Any such waiver or abridgement shall be in
writing except a waiver of notice of a meeting of shareholders or of the board
which may be given in any manner. Attendance of a director at a meeting of
directors or of a shareholder or any other person entitled to attend a meeting
of shareholders is a waiver of notice of the meeting except where such director,
shareholder or other person, as the case may be, attends a meeting for the
express purpose of objecting to the transaction of any business on the grounds
that the meeting is not lawfully called.
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The foregoing By-law No. 1 is hereby passed as evidenced by the
signatures of all the directors of the Corporation pursuant to the provisions of
the BUSINESS CORPORATIONS ACT (Alberta).
DATED this 6th day of December, 2002.
/s/ Vince Tkachyk /s/ Robert L.G. Watson
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Director Director
The foregoing By-law No. 1 is hereby confirmed as evidenced by the
signature of the sole shareholder of the Corporation entitled to vote pursuant
to the provisions of the BUSINESS CORPORATIONS ACT (Alberta).
DATED this 6th day of December, 2002.
967173 ALBERTA LTD.
By: ABRAXAS PETROLEUM CORPORATION
/s/ Robert L.G. Watson
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President and Chief Executive Officer