The company must issue at least one share, which represents a
unit of ownership in the company. A person who owns one or
more shares in a company is called a shareholder.
If the company has only one share, then that one share
represents 100% ownership in the company and so on. The
shares of the company can be divided up into classes which
give different types of rights to the shareholder.
A share price should be determined. In addition to money, services or properties can be offered as consideration for shares.
Restrictions on Securities Transfers — Pre-defined Provisions
Restrictions On Securities Transfer: The corporation’s
securities, other than non- convertible debt securities, shall
not be transferred without either:
1. the sanction of a majority of the directors of the
corporation, or
2. the sanction of the majority of the shareholders of the
corporation, or
3. if applicable, the restriction contained in security
holders’ agreements.
Restrictions on Borrowing Powers of Directors — Pre-defined
Provisions
If authorized by by-law which is duly made by the directors
and confirmed by ordinary resolution of the shareholders, the
directors of the corporation may from time to time:
1. Borrow money upon the credit of the corporation,
2. Issue, reissue, sell or pledge debt obligations of
the corporation; and
3. Mortgage, hypothecate, pledge or otherwise create a
security interest in all or any property of the corporation,
owned or subsequently acquired to secure any debt obligation
of the corporation.
Any such by-law may provide for the delegation of such
powers by the directors to such officers or directors of
the corporation to such extent and in such manner as may
be set out in the by-law.
Nothing herein limits or restricts the borrowing of money
by the corporation on bills of exchange or promissory
notes made, drawn, accepted or endorsed by or on behalf of
the corporation.
If the company does not need different classes of shares (for example, you are the
sole shareholder in the company and will own all the shares), you may want to select
this option.
In the case of one class of shares only, in proportion to their percentage ownership, the shareholder(s) will have the right to do all the following:
Vote,
Receive dividends, and
Receive the remaining property of the
company after dissolution (the company
ceases to be a company or winds up).
Rights — Pre-defined Provisions
The corporation is authorized to issue an unlimited number of Class A and Class B
shares with the following rights, privileges, restrictions and conditions:
1. Class A shares, without nominal or par value, the holders of which are entitled:
To vote at all meetings of shareholders except meetings at which only holders
of a
specified class of shares are entitled to vote; and
To receive the remaining property of the corporation upon dissolution; and
Subject to the rights and privileges attaching to the Class B shares, to receive the
dividends as and when declared by the board of directors of the corporation.
2. Class B shares, which shall carry the right:
To a dividend as fixed by the board of directors and
Upon the liquidation or winding-up of the corporation, to repayment of the
amount paid for such share (plus any declared and unpaid dividends) in priority
to the Class A shares, but they shall not confer a right to any further participation
in profits or assets.
The holders of Class B shares shall not be entitled to vote at meetings of
shareholders except as otherwise specifically provided in the Canada Business
Corporations Act.