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Alberta Corporation Annual Shareholder Resolutions

Alberta law requires each corporation in the province to complete certain things each year. One of those things is for the shareholders to hold an annual general meeting. In order to prove that the meeting occurred, the law requires documentation of the meeting. The Business Corporations Act is the legislation containing the laws the Alberta Corporations follow. Keep reading to learn about the requirement to hold a meeting, which resolutions the law requires at the meeting and the form of proof documenting it. Need help? The corporate lawyers at Kahane Law Office, help clients in both the Calgary and Edmonton areas. We explain the requirements, maintain minute books and keep your company healthy from a legal standpoint. This allows you to keep working on the success of your business.

What Is An Annual General Meeting Of A Corporations?

An annual general meeting, or AGM, is a meeting of all the shareholders of a company. A shareholder is another name for the legal owners of a company. Alberta law requires that every corporation in Alberta hold an annual general meeting within at least 15 months after the previous AGM. This requirement extends to 18 months for the very first meeting after incorporating. The law requires the sending of the notice of the AGM at least 21 days before the meeting occurs. However, 50 days before the meeting is the earliest for sending of the notice.  The requirement extends to sending notice to all shareholders, directors and auditors of the corporation. Annual shareholder resolutions reflect the decisions voted upon at these meetings. Further, even corporations with one  shareholder must hold these meetings.

Special meetings of shareholders also require resolutions. Those resolutions include the specific agenda items voted on at those meetings. Corporations call those meetings on a “as required” basis. The shareholders also store these resolutions in the minute book as described below.

Meeting Content Requirements At The AGM

Each year, corporate shareholders vote for certain matters. The law specifies these minimum requirements. Find the list of requirements below, however, any special other business is also allowed for voting on at the AGM so long as the notice of the meeting includes the specific details of the contemplated vote. In regards to requires matters, the law includes a few specifics. For example, these include:

  • Electing the company directors;
  • Approving the annual financial statements;
  • Fixing the number of directors for the year;
  • Appointing an auditor for the corporation; and lastly
  • Approving the auditors report.

Note, that if agreed on by all shareholders, the annual shareholder resolutions may resolve that no audit is required for that year.

Other Regular Votes In Annual Shareholder Resolutions

Many corporations wish to include other matters to vote on in the AGM. While sometimes a substantive issues arises, most often these include routine functional votes. For example, some common AGM voting matters included in annual shareholder resolutions include:

  • Allowing for a loan;
  • Authorizing the purchase or sale of a significant asset;
  • Assigning corporate signing authority;
  • Removing or changing any signing authority; and lastly
  • Authorizing someone to hold banking authority.

What Are Corporate Resolutions?

Corporate resolutions, including annual shareholder resolutions, are written recordings of the matters voted on at a shareholder meeting and the results of the vote. The annual shareholder resolutions provide proof that the corporation follows the legal requirements on an annual basis. Once passed and approved, the annual shareholder resolutions rest in the corporate minute book. The minute book records all essential corporate documentation. Failing to properly maintain a corporate minute book, often leads to expensive problems for the corporation. Once drafted, each shareholder signs the resolution. If preferred, shareholders have the ability to skip holding an annual shareholder meeting, if every shareholder signs the annual shareholder resolution.

If You Fail To Keep Annual Shareholder Resolutions

Failing to create or keep annual shareholder resolutions often leads to costly and time consuming problems. Since the law requires them, the problems included in not having the resolutions go far beyond missing a technical requirement. For example, common issues that companies experience include the following:

  • Inability to get financing;
  • Loss of preferential tax treatment
  • Reversal of previous tax advantages;
  • The inability to sell the corporation; and lastly
  • Lack of authority to enter into contracts.

For these reasons, as well as to protect the company if served with legal papers, we strongly recommend that all corporations in Alberta appoint a law firm as the registered office of the corporation. Most important for shareholders to know, is the peace of mind knowing that their investment receives the proper protection.

Alberta Lawyers To Help With Annual Shareholder Resolutions

As a part of acting as the registered office, or as a stand alone request, our corporate lawyers prepare the annual shareholder resolutions required under Alberta law. with offices conveniently located in both Calgary and Edmonton, our corporate lawyers help companies of all sizes with their annual legal needs. Please email or call us when you need us. For quick help please email our corporate team directly here. Also feel free to call. In calgary call 403-225-8810 and in Edmonton please call (780) 571-8463.