Canada Business Corporations Act

Marginal note:Borrowing powers

• 189 (1) Unless the articles or by-laws of or a unanimous shareholder agreement relating to a corporation otherwise provide, the directors of a corporation may, without authorization of the shareholders,

  • (a) borrow money on the credit of the corporation;

  • (b) issue, reissue, sell, pledge or hypothecate debt obligations of the corporation;

  • (c) give a guarantee on behalf of the corporation to secure performance of an obligation of any person; 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.

• Marginal note:Delegation of borrowing powers

  (2) Notwithstanding subsection 115(3) and paragraph 121(a), unless the articles or by-laws of or a unanimous shareholder agreement relating to a corporation otherwise provide, the directors may, by resolution, delegate the powers referred to in subsection (1) to a director, a committee of directors or an officer.

• Marginal note:Extraordinary sale, lease or exchange

  (3) A sale, lease or exchange of all or substantially all the property of a corporation other than in the ordinary course of business of the corporation requires the approval of the shareholders in accordance with subsections (4) to (8).

• Marginal note:Notice of meeting

  (4) A notice of a meeting of shareholders complying with section 135 shall be sent in accordance with that section to each shareholder and shall

  • (a) include or be accompanied by a copy or summary of the agreement of sale, lease or exchange; and

  • (b) state that a dissenting shareholder is entitled to be paid the fair value of their shares in accordance with section 190, but failure to make that statement does not invalidate a sale, lease or exchange referred to in subsection (3).

• Marginal note:Shareholder approval

  (5) At the meeting referred to in subsection (4), the shareholders may authorize the sale, lease or exchange and may fix or authorize the directors to fix any of the terms and conditions thereof.

• Marginal note:Right to vote

  (6) Each share of the corporation carries the right to vote in respect of a sale, lease or exchange referred to in subsection (3) whether or not it otherwise carries the right to vote.

• Marginal note:Class vote

  (7) The holders of shares of a class or series of shares of the corporation are entitled to vote separately as a class or series in respect of a sale, lease or exchange referred to in subsection (3) only if such class or series is affected by the sale, lease or exchange in a manner different from the shares of another class or series.

• Marginal note:Shareholder approval

  (8) A sale, lease or exchange referred to in subsection (3) is adopted when the holders of each class or series entitled to vote thereon have approved of the sale, lease or exchange by a special resolution.

• Marginal note:Termination

  (9) The directors of a corporation may, if authorized by the shareholders approving a proposed sale, lease or exchange, and subject to the rights of third parties, abandon the sale, lease or exchange without further approval of the shareholders.