2.2.4 The authorized capital of the Corporation consists of an unlimited number of Dividend Non-Voting Shares;
2.2.5 The Shares listed in subsection 2.2.4 above are the only issued and outstanding Shares in the capital stock of the Corporation;
2.2.6 No person, firm or corporation has any agreement or option or right capable of becoming an agreement for the purchase, subscription or issuance of any of the unissued Shares in the authorized capital of the Corporation;
2.2.7 Each December 31st [whichever date or cycle you like] the Corporation shall issue a class of Voting Shares in an amount equal to two (2) times the number of Dividend Non-Voting Shares issued and outstanding on that date;
2.2.8 Each Shareholder of a Dividend Non-Voting Share will be granted one Voting Share, of that year’s class of Voting Shares, for every one (1) Dividend Non-Voting Share held by that Shareholder on December 31st of the present year; and
2.2.9 The remaining fifty percent (50%) of the shares in the class of Voting Shares issued on each December 31st shall be held in the Employee Trust by the Corporation and shall be distributed to the Employees of the Corporation pursuant to the formula describing ‘Arced' [whichever equalization formula you like] Vote Sizing:
Employee Vote Size =
Square Root ( 1 – ( Wage Position / ( Number of Employees – 1 ))) ;
1.1 General Governance. The parties hereto hereby agree, to cause such meetings of the Corporation to be held, resolutions passed, By laws enacted, agreements and other documents signed and things performed or done as may be required to provide for the following arrangements in connection with the operation and control of the Corporation:
1.1.1 "Board of Directors": The affairs of the Corporation shall be managed by a Board of Directors which shall, at all times, consist of those persons selected by the holders of the current year’s class of Voting Shares;
1.1.2 "Quorum for a Board Meeting": A quorum for a meeting of the Board of Directors shall be a majority of the directors;
1.1.3 Quorum for a Shareholders' Meeting": A quorum for a meeting of the Shareholders shall consist of such number of Shareholders, present or represented by proxy, holding at least fifty-one percent (51%) of the total number of votes represented by the issued and outstanding Shares of the Corporation enjoying voting rights;
1.1.4 "Approval of Decisions by the Board and the Shareholders": Except as may be otherwise provided in this Agreement, all decisions of the Board of Directors and of the Shareholders of the Corporation shall be decided by a majority of votes cast (or by such greater percentage as may be required by law);
1.1.5 "No Casting Vote": Notwithstanding any statutory rule or rule of procedure to the contrary, the chairman at any meeting of the Board of Directors or at any meeting of the Shareholders of the Corporation shall not be entitled to a second, extra or casting vote in the case of a tie vote at any such meeting;
1.1.6 "Execution of Contracts": Subject to Section 3.7 [whichever appropriate corresponding section], all contracts and documents binding the Corporation shall require the signatures of those individuals determined by the Board of Directors from time to time;
1.1.7 Approval of Share Transfer": The Board of Directors and the Shareholders shall sanction, approve, consent to and otherwise facilitate any transfer of Shares in the capital stock of the Corporation made in compliance with, or which is required to be made by, any provision of this Agreement; and
1.1.8 "Share Certificates": The Board of Directors shall cause all share certificates representing Shares in the capital stock of the Corporation which at any time are issued and outstanding to bear the following endorsement or words similar in effect thereon:
"The share(s) represented by this certificate are subject to the terms and conditions of an Agreement dated the ____ day of __________________, and are not transferable except in compliance with the terms and conditions of the said Agreement, a copy of which is on file at the registered office of the Corporation."
1.2 Decisions Requiring Special Consent. The parties agree without the consent of the Shareholders holding Shares entitled to seventy-five (75%) [whichever percentage you like] of the votes at all meetings of the Shareholders, the following actions in relation to the Corporation (unless otherwise expressly permitted pursuant to the provisions of this Agreement) shall not be undertaken:
1.2.1 No additional Shares of the capital stock of the Corporation shall be issued or allotted;
1.2.2 The capital of the Corporation whether issued or unissued shall not be increased, reduced, converted, sub divided or consolidated;
1.2.3 The Corporation shall not enter into any agreement or make any offer or grant any right capable of becoming an agreement to allot or issue any Shares in its capital stock;
1.2.4 There shall be no material change in the nature of the Business of the Corporation nor shall any action be taken which may lead to or result in such material change;
1.2.5 No proceedings will be taken or instituted for the re-organization, amalgamation, winding up or dissolution of the Corporation;
1.2.6 The number of directors of the Corporation shall not be increased nor decreased and no action shall be taken which would derogate from the right of the Shareholders of the Corporation to nominate members of the Board of Directors, as herein provided;
1.2.7 No dividend, including a stock dividend, or other distribution of the assets of the Corporation shall be made to any Shareholder of the Corporation with respect to any Share in the capital of the Corporation held by such Shareholder;
1.2.8 The Corporation shall not directly or indirectly make loans or advances to, invest in or give security for, or guarantee the debts of any person, except in the ordinary course of business;
1.2.9 The Corporation shall not sell, lease, exchange or dispose of its undertaking or any part thereof as an entirety or substantially as an entirety;
1.2.10 The Corporation shall not enter into partnership or any arrangement for the sharing of profits, union of interests, co operation, joint venture or reciprocal concession arrangement with any other person, firm or corporation except in the normal course of its business;
1.2.11 The Corporation shall not hypothecate, pledge, mortgage, charge or otherwise encumber the whole of its assets or any part thereof except in the ordinary course of its business;
1.2.12 The Corporation shall not take, hold, subscribe for or agree to purchase or acquire shares in the capital stock of any other corporation whether or not such other corporation has objects similar altogether or in part to those of the Corporation;
1.2.13 In the event that one or more of the parties hereto is providing active services to the Corporation, the remuneration of such party shall not be increased nor decreased; and
1.2.14 The Corporation shall not enter any contract between the Corporation and any person not dealing at arm's length with any of the Shareholders of the Corporation or make any payment to any person not dealing at arm's length with any of the Shareholders of the Corporation.
4.1 Restriction on Transfer. No Shares of the capital stock of the Corporation shall be issued, sold, transferred, mortgaged, pledged, charged, or otherwise disposed of or encumbered, except in accordance with this Agreement.
4.2 Permitted Transactions. The following transactions in relation to Shares in the capital stock of the Corporation are permitted:
4.2.1 the sale, transfer or disposition by any Shareholder (the "Transferor") of part or all of that Shareholder's Shares (the "Transferee") subject to the following terms:
4.2.1.1 the Transferee shall comply with the provisions of this Agreement;
4.2.1.2 the Transferor shall be jointly and severally liable with the Transferee for the observance and performance of the Transferor's covenants and obligations hereunder; and
4.2.1.3 if the Transferee is a corporation, all shares of that corporation shall at all times be owned by such Shareholder and no shares of that corporation shall be issued, sold, transferred, pledged, mortgaged, charged or otherwise disposed of or encumbered to any other persons in any manner whatsoever without the prior consent of the Board of Directors of the Corporation.
If the transfer is made in compliance with the foregoing terms, the Transferee shall be entitled to the rights and subject to the obligations of the Transferor hereunder as though such Transferee was the Transferor; and
4.2.2 the sale, transfer, disposition or issuance of any Shares or Holdco Shares in accordance with the terms of this Agreement.
4.3 Agreement Binding on Transferees. No sale, transfer or other disposition of Shares of the Corporation shall be effective and none shall be issued until the person to whom those Shares are to be sold, transferred or otherwise disposed of, or to whom those Shares are to be issued, executes and delivers an agreement in a form and on terms satisfactory to the Board or Directors whereby such person agrees to be bound as a party to this Agreement and to have the provisions of this Agreement apply to it as if it were an original party hereunder. Notwithstanding the execution of any such agreement by the Transferee, the Transferor shall continue to be bound by this Agreement.
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