EXHIBIT 3.19
THIS AMALGAMATION AGREEMENT dated the 14th day of February, 2000;
BETWEEN:
YPTEL LIMITED, a company continued under the Companies Act (Nova Scotia)
as a company limited by shares
("YPTEL")
- and -
TELYP CORPORATION, a body corporate incorporated under the Companies Act
(Nova Scotia) as an unlimited company
("ULC")
WHEREAS:
(a) YPTEL was incorporated under the Canada Business Corporations Act under the
name "YPTel Corporation" on July 22, 1998 and subsequently continued into Nova
Scotia under the name "YPtel Limited" pursuant to the Companies Act (Nova
Scotia) on February 14, 2000 and currently has an authorized capital consisting
of One Thousand (1,000) Class B Shares without nominal or par value (the "YPTEL
Class B Shares"), One Million Eight Hundred and Forty One Thousand (1,841,000)
Class C Shares without nominal or par value (the "YPTEL Class C Shares"), One
Hundred Thousand (100,000) Class D Shares without nominal or par value (the
"YPTEL Class D Shares") and One Hundred Million (100,000,000) Common Shares
without nominal or par value (the "YPTEL Common Shares"), of which One Hundred
(100) YPTEL Class B Shares, no YPTEL Class C Shares, One Hundred (100) YPTEL
Class D Shares and Thirteen Million Five Hundred and Forty- Nine Thousand Three
Hundred and Eight (13,549,300) YPTEL Common Shares are issued and outstanding as
fully paid and non-assessable;
(b) There are presently issued and outstanding a warrant entitling the holder to
acquire on exercise thereof One Million Six Hundred and Seventy-three Thousand
Six Hundred and Thirty-seven (1,673,637) YPTEL Class C Shares ("Warrant No. 1")
and a warrant entitling the holder to acquire on exercise thereof
One Hundred and Seven Thousand Three Hundred and Sixty-three (167,363) YPTEL
Class C Shares ("Warrant No. 2");
(c) ULC was incorporated under the Companies Act (Nova Scotia) on December 22,
1999 as an unlimited liability company and has an authorized capital of One
Hundred Thousand (100,000) shares without nominal or par value, of which One (1)
share is issued and outstanding as fully paid but assessable and is registered
in the name of YPTEL (the "ULC Share"); and
(d) It is considered desirable and in the interests of YPTEL and ULC that they
be amalgamated pursuant to the provisions of Section134 of the Companies Act
(Nova Scotia);
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the
mutual covenants and agreements herein contained, the parties hereto agree as
follows:
1. YPTEL and UCL shall be amalgamated (the "Amalgamation") into and continue as
one company ("Amalco") pursuant to the provisions of Section 134 of the
Companies Act (Nova Scotia) effective on the earlier of: (i) March 15; and (ii)
the date of filing of this Agreement, together with an Order of the Supreme
Court of Nova Scotia approving this Agreement, with the Nova Scotia Registrar of
Joint Stock Companies pursuant to Subsection 134(9) of the Companies Act (Nova
Scotia).
2. The attributes and characteristics of Amalco shall be as follows:
(a) The name of Amalco shall be "YPtel Corporation";
(b) The registered office of Amalco shall be Summit Place, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇;
(c) The authorized capital of Amalco shall be One Hundred Million
(100,000,000) Common Shares without nominal or par value, One
Thousand (1,000) Class B Shares without
nominal or par value, One Million Eight Hundred and Forty One
Thousand (1,841,000) Class C Shares without nominal or par value
and One Hundred Thousand (100,000) Class D Shares without
nominal or par value, which Common Shares, Class B Shares, Class
C Shares and Class D Shares shall be subject to the rights,
privileges, restrictions and conditions set out in Appendix "A"
to the Articles of Association attached hereto as Schedule "B",
with power to divide the shares in the capital for the time
being into several classes and/or to attach thereto respectively
any preferential, common, deferred or qualified rights,
privileges or conditions, including restrictions on voting and
including redemption or purchase of such shares, subject,
however, to the Companies Act (Nova Scotia) and amendments
thereto;
(d) The liability of the members of Amalco shall be unlimited;
(e) The Memorandum of Association of Amalco shall be that attached
hereto as Schedule "A" until amended, altered or added to;
(f) The name, occupation and place of residence of the first
directors of Amalco shall be as follows:
NAME OCCUPATION ADDRESS
---- ---------- -------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Executive ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ Executive ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Executive ▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
J. ▇▇▇▇▇▇▇▇ ▇▇▇▇ Executive ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Executive ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Executive ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Executive ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and such directors shall hold office while qualified until their
successors are from time to time elected in the manner provided
in the Articles of Association of Amalco;
(g) The manner of converting the authorized and issued capital of
YPTEL and ULC into that of Amalco shall be as follows:
(i) each hold of a YPTEL Class B Share, or a fraction
thereof, as the case may be, shall be entitled to One
(1) fully paid but assessable Class B Share of the
capital of Amalco, or a corresponding fraction thereof,
as the case may be, in exchange for each such YPTEL
Class B Share, or fraction thereof;
(ii) each holder of a YPTEL Class D share shall be entitled
to One (1) fully paid but assessable Class D Share of
the capital of Amalco in exchange for each such YPTEL
Class D Share; and
(iii) each holder of a YPTEL Common Share shall be entitled to
One (1) fully paid but assessable Common Share of the
capital of Amalco in exchange for each such YPTEL Common
Share;
(iv) if Warrant No. 1 and Warrant No. 2 are exercised prior
to the Amalgamation, each holder of a YPTEL Class C
Share shall be entitled to One (1) fully paid but
assessable Class Share of the capital of Amalco in
exchange for each such YPTEL Class Share;
(v) the ULC Share, which is held by YPTEL, shall be
cancelled;
(h) The manner of converting Warrant No. 1 and Warrant No. 2 if they
are not exercised prior to the Amalgamation shall be as follows:
(i) the holder of a Warrant No. 1 shall be entitled to a
warrant to acquire One Million Six Hundred and
Seventy-three Thousand Six Hundred and Thirty- seven
(1,673,637) Class C Shares of the capital of Amalco in
exchange for Warrant No. 1; and
(ii) the holder of a Warrant No. 2 shall be entitled to a
warrant to acquire One Hundred and Sixty-seven Thousand
Three Hundred and Sixty-three (167,363) Class C Shares
of the capital of Amalco in exchange for Warrant No. 2;
(i) The Articles of Association of Amalco shall be those attached
hereto as Schedule "B" until repealed, amended, altered or added
to.
3. Amalco shall possess all the property, rights, privileges and franchises, and
shall be subject to all the liabilities, contracts and debts, of YPTEL and ULC.
4. All rights of creditors against the property, rights and assets of YPTEL and
ULC, respectively, and all liens upon their respective properties, rights, and
assets, shall be unimpaired by the Amalgamation and all debts, contracts,
liabilities and duties of YPTEL and ULC, respectively, shall thenceforth attach
to Amalco and may be enforced against it to the same extent as if such debts,
contracts, liabilities and duties had been incurred or contracted by Amalco.
5. No action or proceeding by or against YPTEL and ULC shall ▇▇▇▇▇ or be
affected by the amalgamation but for the purposes of such actions or proceedings
YPTEL and ULC, as the case may be, shall be deemed still to exist and Amalco may
be substituted in such action or proceeding in the place thereof.
6. YPTEL and ULC shall execute and deliver such documents and papers and take
such further actions as may be required to carry out the terms and conditions
hereof and to consummate the Amalgamation in accordance with this Agreement.
7. This Agreement shall enure to the benefit of and be binding upon YPTEL and
ULC and their respective successors and assigns.
8. In case any one or more provisions contained in this Agreement shall be
invalid, illegal or unenforceable in any respect under any law, the validity,
legality and enforceability of the remaining provisions contained herein
(including, without limitation, the further assurances made by YPTEL and ULC
pursuant to Section 6 of this Agreement) shall not in any way be affected or
impaired thereby.
9. This Agreement shall be governed by and construed in accordance with the laws
of the Province of Nova Scotia.
10. Completion of the Amalgamation is subject to approval by the shareholders of
YPTEL and ULC in the manner specified in subsection (4) of Section 134 of the
Companies Act (Nova Scotia) and by a Judge of the Supreme Court of Nova Scotia
as required by subsection (5) of Section 134 of the Companies Act (Nova Scotia).
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of
the day and year first above written.
SIGNED, SEALED and DELIVERED ) YPTEL LIMITED
- in the presence of - )
)
) Per: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
) Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
) Title: Secretary, Treasurer and Chief
) Financial Officer
)
) TELYP CORPORATION
) Per: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
) Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
) Title: President
SCHEDULE "A"
COMPANIES ACT
CHAPTER 81, R.S.N.S. 1989
MEMORANDUM OF ASSOCIATION OF YPTEL CORPORATION
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1 - The name of the Company is YPTEL CORPORATION.
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2 - There are no restrictions on the objects and powers of the Company.
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3 - Pursuant to subsection (11) of Section 26 of the Companies Act, to the
intent that subsection (9) of Section 26 not apply to the Company, the
following powers are hereby expressly conferred upon the Company:
The Company shall have power to
(a) sell or dispose of its undertaking or a substantial part
thereof;
(b) subject to the provisions of the Act with respect to
reduction of capital, distribute any of its property in
specie among its members; and
(c) amalgamate with any company or other body of persons.
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4 - The liability of all of the members is unlimited.
SCHEDULE "B"
COMPANIES ACT
(NOVA SCOTIA)
UNLIMITED COMPANY
ARTICLES OF ASSOCIATION
OF
YPTEL CORPORATION
1. In these Articles, unless there be something in the subject or
context inconsistent therewith:
"Act" means the Companies Act (Nova Scotia) as amended;
"Board" means the directors of the Company for the time being;
"Company" means the Company named above;
"dividend" includes bonus;
"member" and "Shareholder" are used interchangeably;
"Memorandum" means the Memorandum of Association of the Company
and all amendments thereto;
"Month" means calendar month;
"Office" means the registered office for the time being of the
Company;
"Proxyholder" includes an alternate proxyholder;
"Register" means the register of members to be kept pursuant to
Section 42 of the Act;
"Registrar" means the Registrar of Joint Stock Companies for the
time being;
"Reporting Company" and "Reporting Issuer" have the meanings
given to them respectively by the Act;
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"Secretary" includes any person appointed to perform the duties
of Secretary of the Company temporarily;
"Shareholder" means member as that term is used in the Act in
connection with an unlimited company having share capital;
"Special Resolution" has the meaning assigned by Section 87 of
the Act;
"these Presents" and "these Articles" includes these Articles of
Association (and schedules thereto) and any modification or
alteration thereof for the time being in force;
"written" and "in writing" mean and include words printed,
lithographed, represented or reproduced in any mode in a visible
form;
Words importing the singular number only, include the plural
number and vice versa;
Words importing the masculine gender only, include the feminine
gender, and
Words importing persons include corporations.
2. The regulations contained in Table "A" in the first schedule to the
Act shall not apply to the Company.
3. The directors may enter into and carry into effect or adopt and carry
into effect any agreement or agreements from time to time made by or with the
promoters of the Company by or on behalf of the Company with full power
nevertheless from time to time to agree to any modification of the terms of such
agreement or agreements either before or after execution thereof.
4. The directors may, out of any moneys of the Company for the time
being in their hands, pay all expenses incurred in or about the formation and
establishment of the Company, including the expenses of registration.
SHARES
5. The authorized capital of the Company consists of 100,000,000 Common
Shares without nominal or par value, 1,000 Class B Shares without nominal or par
value, 1,841,000 Class C Shares without nominal or par value and 100,000 Class D
Shares without nominal or par value, which Common Shares, Class B Shares, Class
C Shares and Class D Shares are subject to the rights, privileges, restrictions
and conditions set out on Appendix "A" hereto, with power to divide the shares
in the capital for the time being into several classes and/or to attach thereto
respectively any preferential, common,
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deferred or qualified rights, privileges or conditions, including restrictions
on voting and including redemption or purchase of such shares, subject, however,
to the Act and amendments thereto.
6. Subject to the provisions of the agreement or agreements mentioned in
Article 3 hereof, the shares shall be under the control of the directors who may
allot or otherwise dispose of the same to such persons on such terms and
conditions and at such times as the directors may think fit and with full power
to give to any person the call of any shares during such time and for such
consideration as the directors think fit.
7. Shares may be registered in the names of any number of persons not
exceeding three as joint holders thereof.
8. Save as herein otherwise provided, the Company shall be entitled to
treat the registered holder of any share as the absolute owner thereof, and
accordingly shall not, except as ordered by a Court of competent jurisdiction,
or as by statute required, be bound to recognize any equitable or other claim to
or interest in such share on the part of any other person.
CERTIFICATES
9. Certificates of title to shares shall be signed by any one of the
President or a Vice- President or a director or the Secretary or an Assistant
Secretary or by such other person as the directors may authorize.
10. Every member shall be entitled to one certificate for all his
shares, or to several certificates each for one or more of such shares.
11. Where shares are registered in the names of two or more persons, the
Company shall not be bound to issue more than one certificate or one set of
certificates, and such certificate or set of certificates shall be delivered to
the person first named on the Register.
12. If any certificate be worn out or defaced, then upon production
thereof to the directors, they may order the same to be cancelled, and may issue
a new certificate in lieu thereof; and if any certificate is lost or destroyed,
then upon proof thereof to the satisfaction of the directors, and on such
indemnity as the directors deem adequate being given, a new certificate in lieu
thereof shall be given to the person entitled to such lost or destroyed
certificate.
13. The directors may cause to be kept in any place or places either in
or outside of Nova Scotia, one or more branch Registers.
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TRANSFER OF SHARES
14. The instrument of transfer of any share in the Company shall be
signed by the transferor and the transferor shall be deemed to remain the holder
of such share until the name of the transferee is entered in the Register in
respect thereof, and shall be entitled to receive any dividend declared thereon
before the registration of transfer.
15. The instrument of transfer of any share shall be in writing in the
following form, or as near thereto as circumstances will permit:
For value received...........................hereby, sell, assign and
transfer unto................................. Shares of the Capital
Stock represented by the within Certificate, and do hereby irrevocably
constitute and appoint ................... attorney to transfer the said
stock on the books of the within named Company with the full power of
substitution in the premises,
Dated the day of , 19
WITNESS:
16. Every instrument of transfer shall be left at the Office for
registration, accompanied by the certificate of the shares to be transferred,
and such other evidence as the Company may require to prove the title of the
transferor or his right to transfer the shares.
17. Every instrument of transfer shall, after the registration thereof,
remain in the custody of the Company, but any instrument of transfer which the
directors decline to register shall be returned to the person depositing the
same.
INCREASE AND REDUCTION OF CAPITAL
18. Subject to the rights, if any, of the holders of shares of any class
or series of shares to vote separately as a class or series thereon, the Company
in general meeting may, from time to time, increase the capital by the creation
or issue of new shares of such amount as it thinks expedient.
19. Subject to the rights, if any, of the holders of shares of any class
or series of shares to vote separately as a class or series thereon, the Act and
the restrictions on allotment, disposition and transferability in these
Articles, the new shares may be issued upon such terms and conditions, and with
such rights and privileges annexed thereto, as the general meeting resolving
upon the creation thereof shall direct; and if no direction be given, as the
directors shall determine, and in particular such shares may be issued with a
preferential or qualified right to dividends and in the distribution of assets
of the Company, and with a special or without any right of voting.
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20. Except so far as otherwise provided by the conditions of issue, or
by these Articles, any capital raised by the creation of new shares shall be
considered part of the original capital, and shall be subject to the provisions
herein contained.
21. Subject to the rights, if any, of the holders of shares of any class
or series of shares to vote separately as a class or series thereon, the Company
shall reduce all or a portion of the paid-up capital on its shares by returning
same to the holders thereof if such reduction and return is authorized by
resolution at a meeting of the Shareholders who are the registered owners of
Seventy- Five Percent (75%) or more of the shares which entitle the holders
thereof to vote at a general meeting. If the return of paid-up capital is so
authorized, the Shareholders approving of such return at such meeting shall
determine when the paid-up capital shall be returned on the shares of the
Company, the amount of paid-up capital to be returned on each such share and
whether such paid-up capital should be returned to the holders of such shares in
the form of cash, a promissory note or other assets of the Company. The amount
of the reduction in the paid-up capital of the shares shall be recorded in the
accounts of the Company.
22. The purpose of this Article is to restrict the operation of Section
12(1) of the Third Schedule to the Act in the manner permitted by that Section.
In the case of an amendment to the Memorandum or Articles of the Company of the
kind referred to in clause (a), (b) or (e) of subsection (2) of Section 2 of the
Third Schedule to the Act, any class of shares or any series of shares affected
by the amendment in a manner different from other shares of the same class shall
not carry the right to vote separately as a class or series upon any such
amendment.
CLASSES OF SHARES
23. Subject to the rights, if any, of the holders of shares of any class
or series of shares entitled to vote separately as a class or series thereon,
and subject to the provisions of these Articles, and without prejudice to any
special rights previously conferred on the holders of existing shares, any share
may be issued with such preferred, deferred or other special rights, or such
restrictions, whether in regard to dividends, voting, return of share capital or
otherwise, as the Company may from time to time by Special Resolution determine.
Any preference shares may with the sanction of a Special Resolution of the
Company be issued on the terms that they are, at the option of the Company,
liable to be redeemed or purchased by the Company.
BORROWING POWERS
24. The directors on behalf of the Company may from time to time in
their discretion:
(a) Raise or borrow money for the purposes of the Company or
any of them;
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(b) Secure the repayment of moneys so raised or borrowed in
such manner and upon such terms and conditions in all
respects as they think fit, and in particular by the
execution and delivery of mortgages of the Company's
real or personal property, or by the issue of bonds,
debentures or debenture stock of the Company secured by
mortgage or otherwise or charged upon all or any part of
the property of the Company, both present and future,
including its uncalled capital for the time being;
(c) Sign or endorse bills, notes, acceptances, cheques,
contracts, and other evidence of or securities for money
borrowed or to be borrowed for the purposes aforesaid;
and
(d) Pledge debentures as security for loans.
25. Bonds, debentures, debenture stock and other securities may be made
assignable, free from any equities between the Company and the person to whom
the same may be issued.
26. Any bonds, debentures, debenture stock, and other securities may be
issued at a discount, premium, or otherwise, and with any special privileges as
to redemption, surrender, drawings, allotment of shares, attending and voting at
general meetings of the Company, appointment of directors, and otherwise.
RECORD DATES
27. (1) For the purpose of determining
(a) shareholders entitled to receive payment of a dividend,
or
(b) who is a shareholder for any other purpose except the
right to receive notice of, or to vote at, a meeting,
the Directors may fix in advance a date as the record date for the determination
of shareholders, but for the record date so fixed shall not precede by more than
fifty days the particular action to be taken.
(2) For the purpose of determining shareholders entitled to receive
notice of a meeting of shareholders, the Directors may fix in advance a date as
the record date for the determination of shareholders, but the record date so
fixed shall not precede the date on which the meeting is to be held by more than
fifty days or less than twenty-one days.
(3) If no record date is fixed pursuant to subsection (1) or (2),
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(a) the record date for the determination of
shareholders for any purpose, other than to
establish a shareholder's right to receive
notice of, or to vote at, a meeting, is the day
on which the Directors pass the resolution
relating to the particular purpose; and
(b) the record date for the determination of
shareholders entitled to receive notice of, or
to vote at, a meeting of shareholders is
(i) the day immediately preceding the day on
which the notice is given, or
(ii) if no notice is given, the day on which
the meeting is held.
(4) Subject to subsection (5), where a record date is fixed for
a Company, notice thereof shall, not less than seven days before the record
date, be given
(a) by advertisement in a newspaper in general
circulation in the place where the head office
of the Company is situated and in each place in
Canada where the Company has a transfer agent or
where a transfer of Company's shares may be
recorded; and
(b) by written notice to each stock exchange, if
any, in Canada on which the shares of the
Company are listed for trading.
(5) Notice of a record date fixed for a company need not be
given where notice of the record date is waived in writing by every holder of a
share of the class or series affected whose name is set out in the Register at
the close of business on the date the Directors fix the record date.
MEETINGS
28. The first meeting of the Company shall be held within eighteen
months from the date of the registration of the Memorandum of Association of the
Company and at such place as the directors may determine.
29. Other general meetings shall be held once at least in every calendar
year, at such time and place as may be determined by the directors and not more
than fifteen months after the preceding general meeting.
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30. The general meetings referred to in the next preceding Article shall
be called ordinary general meetings; and all other meetings of the Company shall
be called special general meetings.
31. The directors, whenever they think fit, may convene a special
general meeting and, on the requisition of members of the Company holding not
less than five percent of the shares of the Company carrying the right to vote
at the meeting sought to be held, the directors shall forthwith proceed to
convene a special general meeting of the Company to be held at such time and
place as may be determined by the directors.
32. The requisition must state the objects of the meeting required, and
must be signed by the members making the same and shall be deposited at the
Office, and may consist of several documents in like form each signed by one or
more of the requisitionists.
33. If the directors do not proceed to cause a meeting to be held,
within twenty-one days from the date of the requisition being so deposited, the
requisitionists, or any of them representing more than one-half of the total
voting rights of all of them, may themselves convene the meeting, but any
meeting so convened shall not be held after three months from the date of such
deposit.
34. If at any such meeting a resolution requiring confirmation at
another meeting is passed, the directors shall forthwith convene a further
special general meeting for the purpose of con sidering such resolution; and if
thought fit, of confirming it as a Special Resolution; and if the directors do
not convene the meeting within seven days from the date of the passing of the
first resolution, the requisitionists, or any of them representing more than
one-half of the total voting rights of all of them, may themselves convene the
meeting.
35. Any meeting convened under the foregoing provisions by the
requisitionists shall be convened in the same manner as nearly as possible as
that in which meetings are to be convened by directors.
36. At least twenty-one days' notice of every general meeting specifying
the place, day and hour of the meeting, and, in the case of special business,
the general nature of such business, shall be sent to the members entitled to be
present at such meeting by notice sent by post or otherwise served as
hereinafter provided; and, with the consent in writing of all the members
entitled to vote at such meeting, a meeting may be convened by shorter notice
and in any manner they think fit, or if all the members are present at a
meeting, either in person or by proxy, notice of time, place and purpose of the
meeting may be waived.
37. Where it is proposed to pass Special Resolution, the two meetings
may be convened by one and the same notice, and it shall be no objection to such
notice that it only convenes the second meeting contingently upon the resolution
being passed by the required majority at the first meeting.
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38. The accidental omission to give any such notice to any of the
members or the non- receipt of any such notice by any of the members shall not
invalidate any resolution passed at any such meeting.
PROCEEDINGS AT GENERAL MEETINGS
39. The business of an ordinary general meeting shall be to receive and
consider the financial statements of the Company, the reports of the directors
and of the auditors, if any, to elect directors in the place of those retiring
and to transact any other business which under these Articles ought to be
transacted at an ordinary general meeting.
40. (1) Two members (where there is more than one member) personally
present or represented by proxy and entitled to vote shall be a quorum for a
general meeting. A corporation which is a member of the Company and which has
duly appointed a representative under the provisions of the Act who is
personally present at the meeting, shall for the purposes of this Article be
considered as if personally present thereat.
(2) If within half an hour from the time appointed for the
meeting a quorum is not present, the meeting, if convened upon the requisition
of the members of the Company pursuant to Article 31, shall be dissolved; but in
any other case it shall stand adjourned, to the same day, in the next week, at
the same time, and place, and if at such adjourned meeting a quorum is not
present, those members entitled to vote as aforesaid who are present shall be a
quorum, and may transact the business for which the meeting was called.
41. No business shall be transacted at any general meeting unless the
quorum requisite be present at the commencement of the business.
42. The Chairman of the Board shall be entitled to take the chair at
every general meeting, or if there be no Chairman of the Board, or if at any
meeting he shall not be present within fifteen minutes after the time appointed
for holding such meeting, the President, or failing him a Vice- President who is
a director, shall be entitled to take the chair and if none of the Chairman of
the Board nor the President, nor such a Vice-President, shall be present within
fifteen minutes after the time appointed for holding the meeting, the members
present entitled to vote at the meeting shall choose another director as
Chairman and if no director is present or if all the directors present decline
to take the chair, then the members present entitled to vote shall choose one of
their number to be Chairman.
43. Every question submitted to a meeting shall be decided, in the first
instance, by a show of hands, and in the case of an equality of votes, the
Chairman shall not, whether on a show of hands or on a poll, have a casting vote
in addition to the vote or votes to which he may be entitled as a member.
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44. At any general meeting a resolution put to the meeting shall be
decided by a show of hands, unless a poll is (before or on the declaration of
the result of a show of hands) demanded by the Chairman or by a member, or by a
Proxyholder and, unless a poll is so demanded a declaration by the Chairman that
a resolution has been carried, or carried by a particular majority, or lost, or
not carried by a particular majority, and an entry to that effect in the book of
proceedings of the Company, shall be conclusive evidence of the fact without
proof of the number or proportion of the votes recorded in favour or against
such resolution. Subject to the Act and these Articles, a resolution shall be
carried if more than Fifty Percent (50%) of the votes are cast in favour of such
resolution by the members entitled to vote thereon.
45. If a poll is demanded as aforesaid, it shall be taken in such
manner, at such time and place as the Chairman of the meeting directs, and
either at once, or after an interval or adjournment or otherwise, and the result
of the poll shall be deemed to be the resolution of the meeting at which the
poll was demanded. The demand of a poll may be withdrawn. In case of any dispute
as to the admission or rejection of a vote, the Chairman shall determine the
same, and such determination made in good faith, shall be final and conclusive.
46. The Chairman of a general meeting may, with the consent of the
meeting, adjourn the same from time to time, and from place to place, but no
business shall be transacted at any adjourned meeting other than the business
left unfinished at the meeting from which the adjournment took place.
47. Any poll demanded on the election of a Chairman of a meeting or any
question of adjournment shall be taken at the meeting, and without adjournment.
48. The demand of a poll shall not prevent the continuance of a meeting
for the transaction of any business other than the question on which a poll has
been demanded.
VOTES OF MEMBERS
49. (1) Subject to the Act, the provisions applicable to any shares
issued under conditions limiting or excluding the right of holders thereof to
vote at general meetings and these Articles, on a show of hands every member
present in person and every Proxyholder, subject to Section 85F(2) of the Act,
shall have one vote, and upon a poll every member present in person or by proxy
shall have one vote for every share held by him.
(2) Where a corporation being a member is represented by a
Proxyholder who is not a member or by a representative duly authorized under the
Act, such Proxyholder or representative shall be entitled to vote for such
corporation either on a show of hands or on a poll.
50. Where there are joint registered holders of any share, any one of
such persons may vote at any meeting either personally or by proxy, in respect
of such share, as if he were solely entitled thereto; and if more than one of
such joint holders is present at any meeting, personally or by proxy, that one
of the
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said persons so present, whose name stands first on the Register in respect of
such share, shall alone be entitled to vote in respect thereof.
51. Votes may be given either personally or by proxy or in the case of a
corporation by a representative duly authorized under the Act.
52. (1) A proxy shall be in writing under the hand of the appointer or
of his attorney duly authorized in writing, or, if such appointer is a
corporation, under its common seal or the hand of its attorney or representative
authorized in the manner referred to in Section 86(l)(a) of the Act.
(2) Holders of share warrants shall not be entitled to vote by
proxy in respect of the shares included in such warrants unless otherwise
expressed in such warrants.
53. A member of unsound mind, in respect of whom an order has been made
by any Court of competent jurisdiction, may vote by his guardian or other person
in the nature of a guardian appointed by that Court and any such guardian or
other person may vote by proxy.
54. A proxy and the power of attorney or other authority, if any, under
which it is signed or a notarially certified copy of that power or authority
shall be deposited with the Chairman of the meeting before or at the meeting or
adjourned meeting at which it is to be voted. A proxy shall cease to be valid
one year after its date.
55. A vote given in accordance with the terms of a proxy shall be valid
notwithstanding the previous death of the principal, or revocation of the proxy,
or transfer of the share in respect of which the vote is given, provided no
intimation in writing of the death, revocation, or transfer shall have been
received before the meeting, at the Office of the Company or by the Chairman of
the meeting before the vote is given.
56. Every form of proxy, whether for a specific meeting or otherwise
shall, as nearly as circumstances will admit, be in the form or to the effect
following; or in such other form complying with the regulations made pursuant to
the Act as the directors may from time to time determine:
I..................of .................... in the County of
.................. being a member of YPTEL CORPORATION, hereby appoint
...................................... of (or failing him
................. of ............... or failing him ................ of
..............) as my proxy to attend and vote for me and on my behalf
at the ordinary general (or special general as the case may be) meeting
of the Company, to be held on the ....... day of .................. and
at any adjournment thereof, or at any meeting of the Company which may
be held within .................... months from the date thereof.
[if the proxy solicited by or on behalf of management of the
Company, a statement to that effect]
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As witness my hand this ...... day of ............., 19...
Witness ..................... Shareholder ................
57. Any resolution passed by the directors, notice whereof shall be
given to the members in the manner in which notices are hereinafter directed to
be given and which shall, within one month after it has been passed, be ratified
and confirmed in writing by members entitled on a poll to three-fifths of the
votes, shall be as valid and effectual as a resolution of a general meeting, but
this Article shall not apply to a resolution for winding up the Company, to a
resolution passed in respect of any matter which by statute or these presents
ought to be dealt with by Special Resolution, or any action which, by virtue of
subsection 12(1) of the Third Schedule to the Act, requires approval in
accordance with that subsection.
58. (1) A resolution, including a Special Resolution, in writing and
signed by every Shareholder who would be entitled to vote on the resolution at a
meeting is as valid as if it were passed by such Shareholders at a meeting and
satisfied all the requirements of the Act respecting meetings of the
Shareholders.
(2) A copy of every resolution referred to in subsection (1) of
this Article shall be kept with the minutes of proceedings of Shareholders.
DIRECTORS
59. The number of directors shall be a minimum of One(l) and a maximum
of Ten (10) natural persons.
60. The directors shall have power at any time and from time to time to
appoint any other person as a director either to fill a casual vacancy or as an
addition but the total number of directors shall not at any time exceed the
maximum number, fixed as above, and no such appointment shall be effective
unless two-thirds of the directors concur therein.
61. A director is not required to hold a share in the Company to qualify
as a director.
62. The continuing directors may act notwithstanding any vacancy in
their body; but if the number fall below the minimum above fixed the directors
shall not, except in emergencies or for the purpose of filling up vacancies, act
so long as the number is below the minimum.
63. The directors shall be paid out of the funds of the Company by way
of remuneration for their service such sums, if any, as the Company in general
meeting may determine and such remuneration shall be divided among them in such
proportions and manner as the directors may determine; the directors may also be
paid their reasonable traveling and hotel and other expenses incurred in
consequence of their attendance at meetings of the Board and otherwise in the
execution of their duties as directors.
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64. A director may, in conjunction with the office of director, and on
such terms as to remuneration and otherwise as the directors arrange or
determine, hold any other office or place of profit under the Company or under
any company in which the Company shall be a shareholder or otherwise interested
or under any other company.
65. The office of a director shall ipso facto be vacated:
(a) if he becomes bankrupt or makes an authorized assignment
or suspends payment, or compounds with his creditors;
(b) if he is found to be of unsound mind by a Court of
competent jurisdiction;
(c) if by notice in writing to the Company he resigns his
office; or
(d) if he is removed by resolution of the Company as
provided in Article 76 hereof.
66. No director shall be disqualified by his office from contracting
with the Company either as vendor, purchaser, or otherwise, nor shall any such
contract, or any contract or arrangement entered into or proposed to be entered
into by or on behalf of the Company in which any director shall be in any way
interested, either directly or indirectly, be voided, nor shall any director so
contracting or being so interested be liable to account to the Company for any
profit realized by any such contract or arrangement by reason only of such
director holding that office or of the fiduciary relations thereby established;
but it is declared that the nature of his interest must be declared by him in
the manner required by the Act. No director shall as a director vote in respect
of any contract or arrangement in which he is so interested as aforesaid; and if
he does so vote his vote shall not be counted, but this prohibition may at any
time or times be suspended or relaxed to any extent by a general meeting and
such prohibition shall not apply to any contract by or on behalf of the Company
to give to the directors or any of them any security for advances or by way of
indemnity or to the agreement or agreements referred to in Article 3 of these
Articles or to any modification of such agreement or agreements or any agreement
or agreements substituted therefor or any matter arising there from.
ELECTION OF DIRECTORS
67. At every ordinary general meeting, all the directors shall retire
from office, but shall hold office until the dissolution of the meeting at which
their successors are elected. The Company shall at such meeting fill up the
vacant offices by electing a like manner of persons to be directors, unless it
is determined at such meeting to reduce or increase the number of directors. A
retiring director shall be eligible for re-election.
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68. If at any ordinary general meeting at which an election of directors
ought to take place, no such election takes place, or if no ordinary general
meeting is held in any year or period of years, the retiring directors shall
continue in office until their successors are elected and a general meeting for
that purpose may on notice be held at any time.
69. The Company in general meeting may from time to time increase or
reduce the number of directors, and may determine or alter their qualifications.
70. The Company may, by Special Resolution, remove any director before
the expiration of his period of office and appoint another person who may be
qualified or become qualified in his stead; and the person so appointed shall
hold office during such time only as the director in whose place he is appointed
would have held the same if he had not been removed.
THE PRESIDENT AND VICE-PRESIDENT
71. The directors shall appoint the President of the Company and may
determine the period for which he is to hold office. The President shall have
general supervision of the business of the Company and shall perform such duties
as may be assigned to him by the Board from time to time.
72. The directors may also appoint one or more Vice-Presidents, and may
determine the period for which each of them are to hold office. A Vice-President
shall, at the request of the Board and subject to its directions, perform the
duties of the President during the absence, illness or incapacity of the
President, or during such period as the President may request him so to do.
73. The directors may elect or appoint such other officers of the
Company, having such powers and duties as they think fit. If the directors so
decide, the same person may hold more than one of the offices provided for in
these Articles.
CHAIRMAN OF THE BOARD
74. The directors may elect one of their number to be Chairman of the
Board and may determine the period during which he is to hold office. He shall
perform such duties and receive such special remuneration as the Board may from
time to time provide.
PROCEEDINGS OF DIRECTORS
75. The directors may meet together for the dispatch of business,
adjourn, and otherwise regulate their meetings and proceedings, as they think
fit. The quorum necessary for the transaction of business shall be a majority of
the directors provided that if a quorum is not present at any meeting of
directors, such meeting shall be adjourned to another date determined by the
Chairman of the Board; at such adjourned meeting the quorum will be those
directors present.
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76. Meetings of directors may be held either within or without the
Province of Nova Scotia and the directors may from time to time make
arrangements relating to the time and place of holding directors' meetings. In
any event:
(a) Meetings of directors shall be regularly scheduled at
the end of the calendar year of the Company for the
immediately following calendar year of the Company and
notice of all of those meetings shall be delivered or
mailed or telegraphed, telephoned or telefaxed to each
director at least 48 hours before the meeting is to take
place;
(b) In the case of a meeting of directors, other than a
meeting described in Paragraph (a) immediately above and
an adjourned meeting, notice of every such meeting shall
be delivered or mailed or telegraphed, telephoned or
telefaxed to each director at least five (5) business
days before the meeting is to take place;
(c) In the case of a meeting of directors that has been
adjourned pursuant to Article 81, notice of every such
adjourned meeting shall be delivered or mailed or
telegraphed, telephoned or telefaxed to each director at
least seventy-two (72) hours before the meeting is to
take place; and
(d) A meeting of directors may be held without formal notice
if all the directors are present and waive notice, or if
those absent have signified their assent to such meeting
or their consent to the business transacted thereat.
77. A director may participate in a meeting of directors or of a
committee of directors by means of such telephone or other communications
facilities as permit all persons participating in the meeting to bear each
other, and a director participating in such a meeting by such means is deemed to
be present at that meeting.
78. The President or any director may at any time, and the Secretary,
upon the request of the President or a director shall, convene a meeting of the
directors.
79. Questions arising at any meeting of directors shall be decided by a
majority of votes, and in case of an equality of votes the Chairman shall not
have a second or casting vote.
80. The Chairman of the Board shall preside at the meeting of the
directors. If no Chairman of the Board is elected, or if at any meeting of
directors he is not present within five minutes after the time appointed for
holding the same, the President shall preside, and if the President is not
present at the time appointed for holding the meeting, a Vice-President who is a
director shall preside and, if neither the
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President nor such a Vice-President is present at any meeting within the time
aforesaid, the directors present shall choose some one of their number to be
Chairman of such meeting.
81. A meeting of the directors at which a quorum is present shall be
competent to exercise all or any of the authorities, powers and discretion by or
under the statutes in that behalf or of the regulations of the Company vested in
or exercisable by the directors generally.
82. Subject to any other Article in these Articles, the directors may
delegate any of their powers to committees, consisting of such number of members
of their body as they think fit. Any committee so formed shall in the exercise
of the powers so delegated conform to any regulations that may be imposed on
them by the directors.
83. The meetings and proceedings of any committee consisting of two or
more members shall be governed by the provisions contained in these Articles for
regulating the meetings and proceedings of the directors so far as the same are
applicable thereto and are not superseded by any regulations made by the
directors under the next preceding Article.
84. All acts done at any meeting of the directors or of a committee of
directors, or by any person acting as a director shall, notwithstanding that it
shall afterwards be discovered that there was some defect in the appointment of
such directors or persons acting as aforesaid, or that they or any of them were
disqualified, be as valid as if every such person had been duly appointed and
was qualified to be a director.
85. (1) A resolution in writing and signed by every director who would
be entitled to vote on the resolution at a meeting is as valid as if it were
passed by such directors at a meeting.
(2) A copy of every resolution referred to in subsection (1) of
this Article shall be kept with the minutes of proceedings of the directors or
committee thereof, as the case may be.
86. If any one or more of the directors are called upon to perform extra
services or to make any special exertions in going or residing abroad or
otherwise for any of the purposes of the Company, or the business thereof, the
Company may remunerate the director or directors so doing, either by a fixed sum
or by a percentage of profits or otherwise, as may be determined by the
directors, and such remuneration may be either in addition to or in substitution
for his share in the remuneration above provided.
87. If a resolution authorizes the entering into of an agreement or the
performance of any act, that resolution shall be deemed to authorize the
execution of such further documents and the doing of such further things as may
be necessary or desirable in connection therewith by the persons authorized to
act by the resolution.
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REGISTERS
88. The directors shall cause a proper Register to be kept in accordance
with the provisions of the Act.
89. The directors may cause to be kept in any place outside of Nova
Scotia a branch register of members in accordance with the provisions of the
Act.
90. The directors shall also cause to be kept a proper register,
containing the names and addresses and occupations of its directors or managers
in accordance with the provisions of the Act.
91. The directors shall cause a proper register of the holders of
debentures to be kept at the Office in accordance with the provisions of the
Act.
92. The directors may cause to be kept in any place outside of Nova
Scotia a branch register of the holders of debentures in accordance with the
provisions of the Act.
MINUTES
93. The directors shall cause minutes to be duly entered in books for
that purpose:
(1) Of all appointments of officers;
(2) Of the names of the directors present at each meeting of
the directors and of any committees of directors;
(3) Of all orders made by the directors and committees of
directors;
(4) Of all resolutions and proceedings of meetings of the
Shareholders and of meetings of the directors;
Any such minutes of any meeting of the directors or of any committee, or
of the Company if purporting to be signed by the Chairman of such meeting or by
the Chairman of the next succeeding meeting, shall be receivable as prima facie
evidence of the matters stated in such minutes.
POWERS OF DIRECTORS
94. The management of the business of the Company shall be vested in the
directors, who, in addition to the powers and authorities by these Articles or
otherwise expressly conferred upon them, may exercise all such powers and do all
such acts and things as may be exercised or done by the Company and are not
hereby or by statute expressly directed or required to be exercised or done by
the Company in
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general meeting, but subject nevertheless to the provisions of the statutes in
that behalf and of these Articles and to any regulations from time to time made
by the Company in general meeting; provided that no regulation so made shall
invalidate any prior act of the directors, which would have been valid if such
regulation had not been made.
95. Without restricting the generality of the terms of the last
preceding Article and without prejudice to the general powers conferred thereby,
and the other powers conferred or restrictions imposed by these Articles on the
powers of the directors, it is hereby expressly declared that the directors
shall have the following powers, that is to say power from time to time:
(1) To take such steps as they think fit to carry into
effect any agreement or contract made by or on behalf of
the Company;
(2) To pay the costs, charges and expenses, preliminary and
incidental to the promotion, formation, establishment,
and registration of the Company;
(3) To purchase, or otherwise acquire, for the Company any
property, rights or privileges which the Company is
authorized to acquire, and at such price and generally
on such terms and conditions as they think fit;
(4) At their discretion, to pay for any property, rights, or
privileges acquired by or services rendered to the
Company, either wholly or partially in cash or in
shares, bonds, debentures or other securities of the
Company, and any such shares may be issued either as
fully paid up, or with such amount credited as paid up
thereon as may be agreed upon; and any such bonds,
debentures, or other securities may be either
specifically charged upon all or any part of the
property of the Company, or not so charged;
(5) To secure the fulfilment of any contracts or engagements
entered into by the Company, by mortgage or charge of
all or any of the property of the Company and its unpaid
capital for the time being, or in such other manner as
they may think fit;
(6) To appoint, and at their discretion remove or suspend,
such experts, managers, secretaries, assistant
secretaries, treasurers, officers, clerks, agents and
servants for permanent, temporary or special services,
as they from time to time think fit, and to determine
their powers and duties, and fix their salaries or
emoluments, and to require security in such instances
and to such amounts as they think fit;
(7) To accept from any member insofar as the law permits,
and on such terms and conditions as shall be agreed
upon, a surrender of his shares or any part thereof;
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provided that the Company forthwith cancel such
surrendered shares or any part thereof, as the case may
be;
(8) To appoint any person or persons (whether incorporated
or not) to accept and hold in trust for the Company any
property belonging to the Company, or in which it is
interested, and for any other purposes, and to execute
and do all such deeds and things as may be requisite in
relation to any such trust, and to provide for the
remuneration of any such trustee or trustees;
(9) To institute, conduct, defend, compound, or abandon any
legal proceedings by or against the Company, or its
officers, or otherwise concerning the affairs of the
Company, and also to compound and allow time for payment
or satisfaction of any debts due, and of any claims or
demands by or against the Company;
(10) To refer any claims or demands by or against the Company
to arbitration, and observe and perform the awards;
(11) To make and give receipts, releases and other discharges
for money payable to the Company and for claims and
demands of the Company;
(12) To determine who shall be entitled to exercise the
borrowing powers of the Company and sign on the
Company's behalf bonds, debentures or other securities,
bills, notes, receipts, acceptances, assignments,
transfers, hypothecation, pledges, endorsements,
cheques, drafts, releases, contracts, agreements and all
other instruments and documents;
(13) To provide for the management of the affairs of the
Company abroad in such manner as they think fit, and in
particular to appoint any persons to be the attorneys or
agents of the Company with such powers (including power
to sub-delegate) and upon such terms as may be thought
fit;
(14) To invest and deal with any of the moneys of the Company
not immediately required for the purposes thereof upon
such securities and in such manner as they think fit,
and from time to time to vary or realize such
investments;
(15) To execute in the name and on behalf of the Company, in
favour of any director or any other person who may incur
or be about to incur any personal liability for the
benefit of the Company, such mortgages of the Company's
property, present and future, as they think fit, and any
such mortgages may contain a power of sale, and such
other powers, covenants and provisions as shall be
agreed on;
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(16) To set aside out of the profits of the Company before
declaring any dividend, such sums as they think proper
as a reserve fund to meet contingencies, or to provide
for dividends, or for depreciation, or for repairing,
improving and maintaining any of the property of the
Company and for such other purposes as the directors
shall in their absolute discretion think conducive to
the interests of the Company; and to invest the several
sums so set aside upon such investments other than
shares of the Company as they may think fit, and from
time to time to deal with and vary such investments, and
to dispose of all or any part thereof for the benefit of
the Company, and to divide the reserve fund into such
special funds as they think fit, with full power to
employ the assets constituting the reserve fund in the
business of the Company; and that without being bound to
keep the same separate from the other assets;
(17) From time to time to make, vary and repeal by-laws for
the regulation of the business of the Company, or of its
officers and servants, or the members of the Company, or
any section or class thereof;
(18) To enter into all such negotiations and contracts, and
rescind and vary all such contracts, and execute and do
all such acts, deeds, and things in the name and on
behalf of the Company as they may consider expedient for
or in relation to any of the matters aforesaid, or
otherwise for the purposes of the Company; and
(19) To provide for the management of the affairs of the
Company in such manner as they shall think fit.
SOLICITORS
96. The Company may employ or retain a solicitor or solicitors, and such
solicitor(s) may, at the request of the Board, or on instructions of the
Chairman of the Board, or the President, attend meetings of the directors or
Shareholders, whether or not he, himself, is a member or director of the
Company. If a solicitor is also a director, he may nevertheless charge for
services rendered to the Company as a solicitor.
SECRETARY AND TREASURER
97. There shall be a Secretary of the Company, who shall keep the
minutes of Shareholders' and directors' meetings and shall perform such other
duties as may be assigned to him by the Board. The Board may also appoint a
Chief Executive Officer, a Chief Financial Officer, a Treasurer and one or more
Assistant Secretaries of the Company to carry out such duties as the Board may
assign.
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98. The Secretary and Treasurer of the Company shall be appointed by the
directors. If the directors think fit, the same person may hold both offices.
99. If the directors think fit, the same person may hold the offices of
President and Secretary.
100. The directors may appoint a temporary substitute for the Secretary,
who shall, for the purposes of these Articles, be deemed to be the Secretary.
THE SEAL
101. The directors shall procure a seal for the Company and shall
provide for its safe custody.
DIVIDENDS
102. The profits of the Company, subject to the provisions of the
Memorandum of Association, and of these presents and to the rights of persons,
if any, entitled to shares with special rights as to dividends, may be divided
among the Shareholders in accordance with the terms of the shares held by them.
103. The directors may from time to time declare such dividend upon the
shares of the Company as they may deem proper according to the rights of the
members and the respective classes thereof, and may determine the date upon
which the same shall be payable, and provide that any such dividend shall be
payable to the persons registered as the holders of the shares in respect of
which the same is declared at the close of business upon such date as the
directors may specify, and no transfer of such shares made or registered, after
the date so specified, shall pass any right to the dividend so declared.
104. No dividend shall be payable except out of the profits of the
Company, and no dividend shall carry interest as against the Company.
105. The declaration of the directors as to the amount of the net
profits of the Company shall be conclusive.
106. The directors may from time to time pay to the members such interim
dividends as in their judgment the position of the Company justifies.
107. The directors, on declaring a dividend, may resolve that such
dividend be paid wholly or in part by the distribution of specific assets, and
in particular of paid up shares, debentures, bonds or debenture stock of the
Company or paid up shares, debentures, bonds or debenture stock of any other
company or in any one or more of such ways.
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108. The directors may resolve that any moneys, investments, or other
assets forming part of the undivided profits of the Company in the hands of the
Company and available for dividend, or representing premiums received on the
issue of shares and standing to the credit of the share premium account, be
capitalized and distributed amongst such of the Shareholders as would be
entitled to receive the same if distributed by way of dividend and in the same
proportions on the footing that they become entitled thereto as capital and that
all or any part of such capitalized fund be applied on behalf of such
Shareholders in paying up in full either at par or at such premium as the
resolution may provide, any unissued shares or debentures or debenture stock of
the Company which shall be distributed accordingly or in or towards payment of
the uncalled liability on any issued shares or debentures or debenture stock,
and that such distribution or payment shall be accepted by such Shareholders in
full satisfaction of their interest in the said capitalized sum.
109. For the purposes of giving effect to any resolution under the two
last preceding Articles, the directors may settle any difficulty which may arise
in regard to the distribution as they think expedient, and in particular may
issue fractional certificates, and may fix the value for distribution of any
specific assets, and may determine that cash payment shall be made to any
members upon the footing of the value so fixed, or that fractions of less value
than $5.00 may be disregarded in order to adjust the rights of all parties, and
may vest any such cash or specific assets in trustees upon such trusts for the
persons entitled to the dividend or capitalized fund as may seem expedient to
the directors. Where requisite, a proper memorandum shall be filed in accordance
with the Act.
110. A transfer of shares shall not pass the right to any dividend
declared thereon after such transfer and before the registration of the
transfer.
111. Any one of several persons who is registered as the joint holder of
any share may give effectual receipts for all dividends and payments on account
of dividends in respect of such share.
112. Unless otherwise determined by the directors, any dividend may be
paid by a cheque or warrant delivered to or sent through the post to the
registered address of the member entitled, or, in the case of joint holders, to
the registered address of that one whose name stands first on the Register, in
respect of the joint holding; and every cheque or warrant so delivered or Sent
shall be made payable to the order of the person to whom it is delivered or
sent.
113. Notice of the declaration of any dividend, whether interim or
otherwise, shall be given to the holders of registered shares in the manner
hereinafter provided.
114. All dividends unclaimed for one year after having been declared may
be invested or otherwise made use of by the directors for the benefit of the
Company until claimed.
ACCOUNTS
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115. The directors shall cause proper books of account to be kept of the
sums of money received and expended by the Company, and the matters in respect
of which such receipts and expenditures take place, and of all sales and
purchases of goods by the Company, and of the assets and credits and liabilities
of the Company.
116. The books of account shall be kept at the Office of the Company or
such other place as the directors think fit.
117. The directors shall from time to time determine whether, and to
what extent, the accounts and books of the Company, or any of them, shall be
open to the inspection of the members, and no member shall have any right of
inspecting any account or book or document of the Company except as conferred by
statute, or authorized by the directors, or by a resolution of the Company in
general meeting.
118. At the ordinary general meeting in every year, the directors shall
lay before the Company the financial statements required by the Act, the report
of the auditor, if any, to the members and, if the Company is a Reporting
Issuer, the report of the directors.
119. The financial statements shall be approved by the Board and such
approval shall be evidenced by the signatures of two directors to the balance
sheet or by the sole Director where there is only one.
120. The directors not less than seven days before the date of the
ordinary general meeting shall send copies of the financial statements and the
report of the auditor, if any, thereon to all members holding voting securities
or otherwise entitled to receive notice of the general meeting.
AUDIT
121. Unless in respect of a financial year the Company is exempt from
the requirements of the Act regarding the appointment and duties of an auditor,
an auditor shall be appointed in accordance with the Act. The auditor's duties
will be regulated in accordance with the Act.
122. Every account of the directors, when audited and approved by a
general meeting, shall be conclusive, except as regards an error discovered
therein within three months next after the approval thereof. Whenever any such
error is discovered within the period, the account shall forthwith be corrected,
and thenceforth shall be conclusive.
NOTICES
123. A notice, statement or report may be given or delivered by the
Company to any Shareholder or director either by delivery to him personally or
by sending it by registered mail or facsimile to him to his last known address
(if Sent by mail) or facsimile number (if sent by facsimile) indicated in the
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records of the Company. Where a notice, statement or report is sent by mail or
by facsimile, service or delivery of the notice, statement or report shall be
deemed to be effected if properly addressed and mailed (if sent by mail) or
properly transmitted and telefaxed (if sent by facsimile) and to have been given
five days (excluding Saturdays and Sundays) following the date of mailing (if
sent by mail) or one day (excluding Saturdays and Sundays) following the date
the facsimile was telefaxed (if sent by facsimile). A certificate signed by the
Secretary or other officer of the Company that the letter, envelope or facsimile
containing the notice, statement or report was so addressed and mailed shall be
conclusive evidence thereof.
124. A notice, statement or report may be given or delivered by the
Company to the joint holders of a share by giving the notice to the joint holder
first named in the Register in respect of the share.
125. Notice of every general meeting or meeting of Shareholders holding
a class of shares shall be given in a manner hereinbefore authorized to every
Shareholder holding, at the time of the issue of the notice or the date fixed
for determining the Shareholders entitled to such notice, whichever is the
earlier, shares which confer the right to notice of and to attend or vote at any
such meeting. No other person except the auditor of the Company and the
directors of the Company shall be entitled to receive notices of any such
meeting.
INDEMNITY
126. Every director, manager, Secretary, Treasurer, and other officer or
servant of the Company shall be indemnified by the Company against, and it shall
be the duty of the directors out of the funds of the Company to pay, all costs,
losses and expenses which any director, manager, Secretary, Treasurer or other
officer or servant may incur or become liable to by reason of any contract
entered into, or act or thing done by him as such officer or servant, or in any
way in the discharge of his duties, including traveling expenses, and the amount
for which such indemnity is proved shall immediately attach as a lien on the
property of the Company and have priority as against the members over all other
claims.
127. No director or officer of the Company, in his capacity as a
director or officer, respectively, shall be liable for acts, receipts, neglects
or defaults of any other director or officer, or for joining in any receipt or
other act for conformity, or for any loss or expense happening to the Company
through the insufficiency or deficiency of title to any property acquired by
order of the directors for or on behalf of the Company or through the
insufficiency or deficiency of any security in or upon which any of the moneys
of the Company shall be invested, or for any loss or damage arising from the
bankruptcy, insolvency or tortious act of any person with whom any money,
securities or effects shall be deposited, or for any loss occasioned by error of
judgment or oversight on his part, or for any other loss, damage or misfortune
whatever which shall happen in the execution of the duties of his office or in
relation thereto, unless the same happen through his own dishonesty.
APPENDIX "A"
The rights, privileges, restrictions and conditions attaching to each of the
Class B Shares, Class C Shares, Class D Shares and Common Shares are as follows:
DEFINITIONS
The terms set out below shall have the following meanings when used herein:
"ACG" means Advanced Communications Group, Inc.
"ACG CLOSING PRICE" means the closing price of ACG common stock on the New York
Stock Exchange on the date of completion of the transactions contemplated by the
YPTel Agreement.
"ADJUSTED SHARE BASE" means the Common Shares of the Initial Common Shareholders
and the Common Shares attributable to the holders of the Class C Shares,
assuming the conversion of the Class C Shares into Common Shares pursuant to the
provisions hereof.
"ARTICLES" means the articles of the Corporation, as amended from time to time.
"CANTERBURY LOAN AGREEMENT" means the Subordinated Loan Agreement among POP
Acquisition, Inc., the Lenders named therein and Canterbury Mezzanine Capital,
L.L.P., as agent for those persons who are Lenders (as therein defined) from
time to time thereunder, dated as of November 1,1998, together with any and all
amendments made from time to time and any agreement replacing or superseding
such Subordinated Loan Agreement.
"COMMON SHARE REORGANIZATION" has the meaning attributed to it in section 6.1.
"CONVERSION BASIS" has the meaning attributed to it in section 5.1.
"EQUITY VALUE OF THE CORPORATION" means, as of the effective date of conversion
of the Special Shares to Common Shares,
(a) in the case of a Going Public Transaction, the aggregate market
capitalization in such Going Public Transaction of the
Corporation; and
(b) in any case other than a Going Public Transaction, the Fair
Market Value of the Corporation.
"EVENT" means the occurrence of any of the following:
(a) a Going Public Transaction; or
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(b) the completion of the transactions contemplated by the YPTel
Agreement.
"EXCHANGE RATE" means the Canadian dollar equivalent of one U.S. dollar as of
the time of closing of the New York Stock Exchange on the date of the completion
of the transactions contemplated by the YPTel Agreement.
"FAIR MARKET VALUE" means, 15,000,000 times the ACG Closing Price.
"GOING PUBLIC TRANSACTION" means any transaction whereby the Corporation or its
successor or assign becomes a reporting issuer in the Province of Ontario or
attains a substantially similar status under the laws of any other jurisdiction
including by way of merger, reorganization, or otherwise and the date of
occurrence thereof shall be deemed the date of the filing of a final prospectus
or comparable document for an initial public offering of the shares of the
Corporation or the completion of another transaction whereby securities of the
Corporation, are offered to the public.
"GOING PUBLIC TRANSACTION SHARE PRICE" means the price per Common Share at Which
the Common Shares are offered under the Going Public prospectus.
"INITIAL COMMON SHAREHOLDERS" means those shareholders of the Corporation who
held Common Shares of the Corporation as of November 20, 1998.
"LENDERS" means the several lenders from time to time who are parties to the
Loan Agreement and holders of the Notes.
"LOAN AGREEMENT" means the Subordinated Loan Agreement among PCP Acquisition,
Inc., as borrower, the Lenders, as lenders, and Canterbury Mezzanine Capital,
L.P., as agent for the Lenders, dated as of the 1st day of November, 1998.
"NOTES" means the evidences of indebtedness to be issued by PCP Acquisition,
Inc. with respect to advance(s) made to it by the Lenders.
"ORIGINAL CAPITAL INVESTED" means the capital invested in Common Shares of the
Corporation by the Initial Common Shareholders, denominated in Canadian dollars
and based on an exchange rate of 1.53 Canadian dollars for each U.S. dollar.
"SHARE BASE" means all the issued and outstanding Common Shares, including those
Common Shares which would result if all issued and outstanding Special Shares
were converted to Common Shares pursuant to the provisions hereof.
"SPECIAL SHARES" means the Class B Shares, Class D Shares and, if issued, Class
C Shares.
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"WARRANT" means either of the warrants issued by the Corporation to the Lenders,
as such term is used in the Canterbury Loan Agreement, and "WARRANTS" means both
of them, and any successor warrants issued by the Corporation on the transfer of
any outstanding Warrant as permitted by the terms of the Warrant certificate
representing any such Warrant, and the terms of the Canterbury Loan Agreement.
"YPTEL AGREEMENT" means the Amended and Restated YPTel Agreement made and
entered into as of October 26, 1999 by and among ACG, the Corporation, the
shareholders of the Corporation, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
Imperial Capital Limited.
1. CLASS B SHARES
1.1 Payment of Dividends: The holders of Class B Shares shall be entitled to
receive such dividends (if any) as the board of directors of the Corporation may
in its discretion declare, provided that any dividend declared must be upon the
Common Shares and all of the Special Shares and Warrants and with respect to the
aggregate amount of each dividend declared, the holders of the Class B Shares as
a class shall be entitled to 25% of such aggregate amount after deducting the
entitlements with respect to such dividend of the holders of the Class C Shares,
the Warrants and the dividends contemplated by subsection 1.4(c) hereof.
1.2 Participation upon Liquidation. Dissolution or Winding Up: In the event of
the liquidation, dissolution or winding up of the Corporation or other
distribution of the property or assets of the Corporation among its shareholders
(other than by way of dividend out of moneys of the Corporation properly
applicable to the payment of dividends), the holders of Class B Shares shall be
entitled to receive an amount equal to 25% of such property or assets of the
Corporation remaining after deducting the respective entitlements with respect
thereto of the holders of the Class C Shares, the Warrants and an amount equal
to the Original Capital Invested and a cumulative return on the Original Capital
Invested of 8% per annum, not compounded, accruing from November 20, 1998.
1.3 Voting Rights: The holders of Class B Shares shall be entitled to receive
notice of and to attend all meetings of the shareholders of the Corporation and
to one vote in respect of each Class B Share held at all such meetings.
1.4 Conversion upon the Occurrence of an Event: Upon the occurrence of an Event,
the issued and outstanding Class B Shares shall be converted into fully paid
Common Shares as the same shall be constituted at the time of conversion at a
rate for each Class B Share determined as follows, without the necessity of any
action by the holders thereof or the Corporation. From the Equity Value of the
Corporation at the effective date of conversion, converted to Canadian dollars
at the Exchange Rate, shall be deducted:
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(a) the proportions of the Equity Value of the Corporation which
reflect the interests therein of the holders of the Class C
Shares and the Warrants, converted to Canadian dollars at the
Exchange Rate;
(b) the Original Capital Invested; and
(c) an amount equal to 8% per annum, cumulative, not compounded,
upon the Original Capital Invested, accruing from November 20,
1998 to the time of conversion.
If the result is a nil or negative amount, the holders of the Class B Shares
shall receive no Common Shares as a result of such conversion. If the result is
a positive amount, the holders of the Class B Shares shall be entitled to that
number of Common Shares, in the aggregate, which upon the completion of the
transactions contemplated by the YPTel Agreement would entitle the holders
thereof to that number of shares of ACG common stock which, in the aggregate,
valued at the ACG Closing Price expressed in Canadian dollars at the Exchange
Rate, would equal 25% of such positive amount. No partial conversions shall be
allowed and no conversions shall be allowed otherwise than as aforesaid.
2. CLASS C SHARES
2.1 Payment of Dividends: The holders of the Class C Shares and Warrants shall
be entitled to receive such dividends (if any) as the board of directors of the
Corporation may in its discretion declare, provided that any dividend declared
must be upon the Common Shares and all of the Special Shares and with respect to
the aggregate amount of each dividend declared the holders of the Class C Shares
and the holders of the Warrants as a class shall be entitled to receive such
percentage as represents the percentage of Common Shares into which the Class C
Shares and Warrants would be converted as provided for in section 2.4 hereof if
at the time of declaration of such dividend such conversion were effective.
2.2 Participation upon Liquidation, Dissolution or Winding up: In the event of
the liquidation, dissolution or winding up of the Corporation or other
distribution of the property or assets of the Corporation among its shareholders
(other than by way of dividend out of property or assets of the Corporation
property applicable to the payment of dividend), the holders of the Class C
Shares and the holders of the Warrants as a class shall be entitled to receive
an amount equal to such percentage of such property or assets of the Corporation
as represents the percentage of Common Shares into which the Class C Shares and
Warrants would be converted as provided for in section 2.4 hereof if at the time
of such distribution such conversion were effective.
2.3 Voting Rights: The holders of Class C Shares and the holders of the Warrants
shall be entitled to receive notice of and to attend all meetings of the
shareholders of the Corporation and the holders of the Class C Shares shall be
entitled to one vote in respect of each Class C Share held at all such meetings.
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2.4 Conversion to Common Shares:
Upon the repayment of the Notes in full, all the issued and outstanding Class C
Shares shall be converted into:
(a) if the Notes are repaid within 12 months of November 20, 1998
(the "First Date"), that number of fully paid Common Shares
representing 4% in the aggregate of the Share Base;
(b) if the Notes are repaid at a time following the First Date but
within 18 months of November 20, 1998 (the "Second Date"), that
number of fully paid Common Shares representing 8% in the
aggregate of the Share Base;
(c) if the Notes are repaid at a time following the Second Date but
within 24 months of November 20, 1998 (the "Third Date"), that
number of fully paid Common Shares representing 10% in the
aggregate of the Share Base; and
(d) if the Notes are repaid at any time following November 20, 2000,
that number of fully paid Common Shares representing 12% in the
aggregate of the Share Base;
Such conversions shall occur without the necessity of any action by the holders
of the Class C shares or the Corporation. No partial conversions shall be
allowed and no conversions shall be allowed otherwise than as aforesaid.
3. CLASS D SHARES
3.1 Payment of Dividends: The holders of Class D Shares shall be entitled to
receive such dividends (if any) as the board of directors of the Corporation may
in its discretion declare, provided that any dividend declared must be upon the
Common Shares and all of the Special Shares and the Warrants and with respect to
the aggregate amount of each dividend declared the holders of the Class D Shares
as a class shall be entitled to receive such percentage of such aggregate amount
as represents the number of Common Shares into which the Class D Shares would be
converted as provided for in section 3.4 hereof if at the time of declaration of
such dividend such conversion were effective, subject to dilution as provided
therein.
3.2 Participation upon Liquidation. Dissolution or Winding-Up: In the event of
the liquidation, dissolution or winding up of the Corporation or other
distribution of property or assets of the Corporation among its shareholders,
(other than by way of dividend out of moneys of the Corporation properly
applicable to the payment of dividends), the holders of the Class D Shares shall
be entitled to receive an amount equal to such percentage of the aggregate
amount of such property or assets of the Corporation pari passu with the
entitlements of holders of Class B Shares, Class C Shares and Common Shares
referred to therein as represents the percentage of Common Shares into which the
Class D Shares would be converted as provided for in section 3.4 hereof if at
the time of such distribution such conversion were
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effective, provided that an amount at least equal to the Original Capital
Invested and a cumulative return thereon of 8% per annum not compounded remains
available for distribution to the Initial Common Shareholders, subject to
dilution as provided in section 3.4 hereof.
3.3 Voting Rights: The holders of the Class D Shares shall be entitled to
receive notice of and to attend all meetings of the shareholders of the
Corporation and to one vote per Class D Share at all such meetings.
3.4 Conversion on the occurrence of an Event: Upon the occurrence of an Event,
the issued and outstanding Class D Shares shall be converted into fully paid
Common Shares, on the basis of the Common Shares resulting from such conversion
comprising:
(i) 2.2546% of the Adjusted Share Base if the entitlement of the
Class C Shares is determined under subsection 2.4 (a);
(ii) 2.1606% of the Adjusted Share Base if the entitlement of the
Class C Shares is determined under subsection 2.4 (b);
(iii) 2.1137% of the Adjusted Share Base if the entitlement of the
Class C Shares is determined under subsection 2.4 (c);
(iv) 2.0667% of the Adjusted Share Base if the entitlement of the
Class C Shares is determined under subsection 2.4 (d),
without the necessity of any action by the holders of the Class D Shares or the
Corporation, subject to dilution by the Common Shares resulting from the
conversion of Class B Shares under section 1.4 hereof and dilution upon the
Issuance of additional shares from time to time. No partial conversions shall be
allowed and no conversion shall be allowed otherwise than as aforesaid.
4. COMMON SHARES
4.1 Payment of Dividends: The holders of Class B Shares, Class C Shares, Class D
Shares and Common Shares shall be entitled to receive such dividends (if any) as
the board of directors of the Corporation may in its discretion declare,
provided that any dividend declared must be upon all of the Class B Shares,
Class C Shares, Class D Shares and Common Shares and with respect to the
aggregate amount of each dividend declared the holders of the Common Shares as a
class shall be entitled to receive that portion of such aggregate amount
remaining after deducting the respective entitlements with respect to such
dividend of the holders of Class B Shares, Class C Shares and Class D Shares.
4.2 Participation upon Liquidation, Dissolution or Winding Up: In the event of
the liquidation, dissolution or winding-up of the Corporation or other
distribution of the property or assets of the
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Corporation among its shareholders (other than by way of dividend out of moneys
of the Corporation properly applicable to the payment of dividends), the holders
of the Common Shares shall be entitled to receive an amount equal to that
portion of the property and assets of the Corporation remaining after deducting
the respective entitlements with respect thereto of the holders of Class B
Shares, Class C Shares and Class D Shares.
4.3 Voting Rights: The holders of the Common Shares shall be entitled to receive
notice of and to attend any meeting of the shareholders of the Corporation and
to one vote per Common Share at any such meeting.
5. PROVISIONS APPLICABLE TO CONVERSION OF SPECIAL SHARES
For the purposes of the conversion of Special Shares into Common Shares:
5.1 "Conversion Basis" at any time shall mean the number of Common Shares of the
Corporation into which at such time Special Shares shall be converted in
accordance with the provisions of this Schedule "A";
5.2 Immediately following such automatic conversion of Special Shares the share
certificates for the Common Shares of the Corporation resulting therefrom shall
be issued in the name of the registered holder of the Special Shares so
converted and the share certificates for the Special Shares shall be deemed to
have been cancelled by the Corporation.
5.3 Such conversion of Special Shares into Common Shares shall be deemed to have
occurred and the registered holders of Special Shares so converted shall be
deemed to have become holders of Common Shares of record of the Corporation for
all purposes upon the occurrence of an Event, notwithstanding that the delivery
of certificates representing the Common Shares into which such Special Shares
have been converted will occur subsequently.
6. ANTI-DILUTION PROVISIONS
6.1 If and whenever at any time the outstanding Common Shares shall be
subdivided, redivided or changed into a greater or consolidated into a lesser
number of shares (any such event being herein called a "Common Share
Reorganization"), the Conversion Basis then in effect shall be adjusted
immediately after the effective date or record date at which the holders of
Common Shares are determined for purposes of the Common Share Reorganization by
multiplying the Conversion Basis in effect immediately prior to such effective
date or record date by a fraction, the numerator of which shall be the number of
Common Shares outstanding immediately after giving effect to such Common Share
Reorganization and the denominator of which shall be the number of Common Shares
outstanding on such effective date or record date before giving effect to such
Common Share Reorganization.
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6.2 If and whenever at any time there is a capital reorganization of the
Corporation other than a Common Share Reorganization, or a consolidation or
merger or amalgamation of the Corporation with or into any other company or body
corporate or a sale whereby all or substantially all of the Corporation's
undertaking and assets would become the property of any other company or body
corporate, each registered holder of Special Shares shall be entitled to receive
and shall accept, upon such capital reorganization, consolidation, merger,
amalgamation or sale of such shares or other securities or property of the
Corporation or of the company or body corporate resulting from the capital
reorganization, consolidation, merger or amalgamation or to which such sale may
be made, as the case may be, special shares that are the same or substantially
the same as the Special Shares to which such registered holder of Special Shares
was entitled prior to such capital reorganization, consolidation, merger,
amalgamation or sale and such special shares shall be automatically convertible
into Common Shares in accordance with provisions similar, as nearly as may be,
to corresponding provisions of these Articles.
7. RESTRICTION ON ISSUES
Notwithstanding anything to the contrary, nothing in these Articles
shall restrict the issuance of additional securities by the Corporation;
provided only that no securities shall be issued by the Corporation that results
In dilution of the rights of the holders of the Class C Shares without their
consent.
8. VOTING
Notwithstanding the provisions of each of sections 1.3, 2.3 and 3.3
hereof, all shares shall vote as one class.