BILL 4

An Act to Amend the Companies Act

Her Majesty, by and with the advice and consent of the Legislative Assembly of New Brunswick, enacts as follows:

1Subsection 2(1) of the Companies Act, chapter C-13 of the Revised Statutes, 1973, is amended by adding after the definition "Minister'' the following:

"project company'' means a company that has received, as required under subsection 18.1(1), the written consent of the Minister of Transportation to incorporate as a project company under this Act for the purposes of entering into an agreement with the New Brunswick Highway Corporation as referred to in subsection 6(3) of the New Brunswick Highway Corporation Act;

2Section 18 of the Act is amended

(a)in subsection (1) by adding a comma followed by "or for the incorporation of a project company'' after "economic development'';

(b)in subsection (2) in the portion preceding paragraph (a)

(i)by adding a comma followed by "or for the incorporation of a project company'' after "economic development'';

(ii)by striking out "corporation'' wherever it appears and substituting "company''.

3The Act is amended by adding after section 18 the following:

RESPECTING PROJECT COMPANIES

18.1(1)The Minister shall not grant a charter by letters patent incorporating a project company unless the application for letters patent is accompanied by the written consent of the Minister of Transportation, consenting to the grant of letters patent.

18.1(2)Notwithstanding subsection 4(1) and paragraph 6(1)(g), one or more persons may apply for a grant of letters patent incorporating a project company.

18.1(3)Notwithstanding any other provision of this Act, a project company is not required to have more than one shareholder or member.

18.1(4)Notwithstanding section 90, no director of a project company is required to be or become a shareholder or a member of the project company.

18.1(5)A project company may, subject to its letters patent or supplementary letters patent, by by-law

(a)establish different classes of members, in which case the terms and conditions applying to each class shall be set out in the by-law,

(b)establish that different classes of members may have different rights to elect or appoint directors,

(c)confer on some classes of members greater voting powers than on others,

(d)confer on different classes of members an exclusive right to elect one or more directors, and

(e)establish criteria for the appointment of one or more directors without election by the members or classes of members.

18.1(6)Section 77 of the Business Corporations Act applies to the directors and officers of a project company with the necessary modifications.

18.1(7)No project company shall pass a by-law authorizing an application for supplementary letters patent without first obtaining the written consent of the Minister of Transportation, consenting to the proposed by-law.

18.1(8)Notwithstanding subsection 35(4), a project company applying to the Minister for leave to surrender its charter shall provide with the application the written consent of the Minister of Transportation, consenting to the surrender.

18.1(9)Notwithstanding section 23 of the Winding-up Act and notwithstanding paragraphs 14(1)(u) and 35(4)(a), a project company shall provide in its letters patent for the distribution of its assets on dissolution, surrender or winding-up and shall distribute them in accordance with those provisions.

4The Act is amended by adding after section 94 the following:

94.1(1)Subject to the letters patent and supplementary letters patent, a resolution in writing or counterparts of such a resolution, 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 committee of directors duly called, constituted and held.

94.1(2)Every resolution or counterpart referred to in subsection (1) shall be kept with the minutes of the meetings of the proceedings of the directors or committee of directors.

94.2A director may participate in a meeting of directors or of a committee of directors by means of telephone or other communication facilities that permit all persons participating in the meeting to hear each other if

(a)the by-laws so provide, or

(b)subject to the by-laws, all the directors of the company consent,

and a director participating in a meeting by those means shall be deemed for the purposes of this Act to be present at that meeting

5Section 95 of the Act is repealed and the following is substituted:

95Any director, former director, officer or former officer of a company or his or her heirs, executors, estate and effects may, with the consent of the company given at any general meeting of the company, from time to time and at all times be indemnified and saved harmless out of the funds of the company from and against all costs, charges and expenses whatsoever that the director, former director, officer or former officer sustains or incurs in or about any action, suit or proceeding that is brought, commenced or prosecuted against him or her for or in respect of any act, deed, matter or thing whatsoever, made, done or permitted by him or her in or about the execution of the duties of his or her office, and also from and against all other costs, charges and expenses that the director, former director, officer or former officer sustains or incurs in or about or in relation to the affairs of the company, except costs, charges or expenses that are occasioned by his or her own wilful neglect or default.

6The Act is amended by adding after section 103 the following:

103.1(1)Subject to the letters patent and supplementary letters patent, a resolution in writing signed by all the shareholders or members entitled to vote on that resolution at a meeting of shareholders or members is as valid as if it had been passed at a meeting of the shareholders or members.

103.1(2)Subject to the letters patent and supplementary letters patent, a resolution in writing dealing with all matters required by this Act to be dealt with at a meeting of shareholders or members, or counterparts of such a resolution, signed by all the shareholders or members entitled to vote at that meeting, satisfies all the requirements of this Act relating to meetings of shareholders or members duly called, constituted and held.

103.1(3)Every resolution or counterpart referred to in subsection (1) or (2) shall be kept with the minutes of the meetings of shareholders or members.

103.2A shareholder or member or any other person entitled to attend a meeting of shareholders or members may participate in the meeting by means of telephone or other communication facilities that permit all persons participating in the meeting to hear each other if

(a)the by-laws so provide, or

(b)subject to the by-laws, all the shareholders or members entitled to vote at the meeting consent,

and a person participating in a meeting by those means shall be deemed for the purposes of this Act to be present at the meeting.

EXPLANATORY NOTES

Section 1

A definition is added as a consequential amendment to the amendments made in sections 2 and 3 of this amending Act.

Section 2

(a)With the amendment, the Minister will be authorized to grant a charter incorporating a project company under the Companies Act.

(b)The existing provision is as follows:

18(2)When in the application for incorporation of any company for charitable, philanthropic, temperance, religious, social, political, literary, educational, athletic or other like purposes or for the purpose of promoting economic development, the applicants apply for incorporation without capital stock, the Minister may by letters patent constitute the applicants and others who may become members thereof, a corporation with all the rights and powers of a corporation under this Act for all or any of the specified purposes or objects and the following provisions (a) to (j) both inclusive, as well as all other provisions of this Act not inconsistent therewith, unless otherwise specified in the letters patent, are applicable to every company so incorporated hereunder without capital stock, namely:

Section 3

Provisions are added in relation to requirements respecting the incorporation of project companies, provisions are added establishing that a project company may have only one shareholder or member and that its directors are not required to be or become shareholders or members, provisions are added in relation to classes of membership in project companies and the criteria for appointment of directors, a provision of the Business Corporations Act respecting conflict of interest is adopted with the necessary modifications and provisions are added in relation to passage of a by-law by a project company authorizing an application for supplementary letters patent, in relation to the surrender of a charter of a project company and in relation to the distribution of the assets of a project company on dissolution, surrender or winding-up.

Section 4

Provisions are added in relation to passage of resolutions of directors or committees of directors of companies in writing and in relation to the holding of meetings of directors or committees of directors of companies by communication facilities.

Section 5

The existing provision is as follows:

95Every director, his heirs, executors, estate and effects, respectively, may, with the consent of the company given at any general meeting thereof, from time to time and at all times be indemnified and saved harmless out of the funds of the company from and against all costs, charges and expenses whatsoever that such director sustains or incurs in or about any action, suit or proceeding that is brought, commenced or prosecuted against him for or in respect of any act, deed, matter or thing whatsoever, made, done or permitted by him in or about the execution of the duties of his office; and also from and against all other costs, charges and expenses that he sustains or incurs in or about or in relation to the affairs thereof, except costs, charges or expenses that are occasioned by his own wilful neglect or default.

Section 6

Provisions are added in relation to passage of resolutions of shareholders or members of companies in writing and in relation to the holding of meetings of shareholders or members of companies by communication facilities.


Last Modified: 11:34am , November 26, 1997