[co-author:Zachary Thacker - Articling Student]
On March 28, 2023, the Alberta Government's Bill 10: Financial Statutes Amendment Act, 2023 (Bill 10) received Royal Assent. Bill 10 amends a number of key corporate statutes, including Alberta's Business Corporation Act, RSA 2000 c B-9 (the Act). Amendments include changes to the shareholder requirement for non-reporting issuer corporations to allow for use of resolutions instead of meetings and the electronic delivery of reporting issuers financial disclosure to shareholders.
Resolutions Instead of Meetings—Shareholder Requirements
In recent amendments to the Act, the Alberta Government modified requirement for written shareholders' resolutions. Whereas, historically, a resolution in writing by the shareholders required unanimous approval, the Act was amended to state that corporations that are not reporting issuers may pass resolutions if "at least 2/3 of the shareholders" signed the resolution. However, this wording caused a degree of concern as the change would allow holders of small numbers of shares rights that were not in proportion with their economic interest in the corporation.
In order to address these concerns and bring this provision in line with other voting provisions of the Act, the government has now further amended the Act to state that a written shareholders' resolution may be approved in writing by "the holders of at least 2/3 of the shares" entitled to vote on that resolution. The effect of this change makes it clear that the written resolution may be signed by any number of shareholders, so long as they represent the votes attached to at least 2/3 of the shares that are entitled to vote on the resolution. This modification continues to apply only corporations who are not reporting issuers.1
This most recent amendment came into force on March 28, 2023.
Electronic Delivery of Reporting Issuer Financial Disclosure To Shareholders
On proclamation, the provisions of Bill-10 amending the Act will be effective to exclude reporting issuers from the requirement to send copies of their financial disclosure to each shareholder prior to annual meetings as long as they have provided access to their shareholders in accordance with the Securities Act and related regulations.2 The amendment was implemented to effectively reduce red tape by permitting the "access equals delivery model" in Alberta—allowing for financial disclosure documents to be delivered electronically as opposed to by mail.3 The particulars of the access equals delivery model as it relates to securities legislation can be found in our previous insight, CSA Seeks Comments on "Access Equals Delivery" Model for Prospectuses, Financial Statements and MD&A.
1 Business Corporations Act, RSA 2000 c B-9, s 141(2.1).
2 Business Corporations Act, RSA 2000 c B-9, ss 156, 159(1).
