JOINT STOCK COMPANIES' MANUAL. J. D. WARDE. Poise 3 Co. UNIVERSITY OF CALIFORNIA LOS ANGELES SCHOOL OF LAW LIBRARY i o PQ CO I" I- Co CO C/D CO GO CD EH GENERAL MACHINFRY DEALERS. Iron and Wood Working Tools. KNOWLES' STEAM PUMPS. MINING MACHINERY OF ALL KINDS OIKK K AM> WOltKS WAHKiioi si; Esplanade, East, 38 Yonge Street oro-woisfiTO. ADVERTISEMENTS. CORPORATE SE^LS I'rom $5.00 upwards, according to durability and finish. We make a specialty of Hardened Brass upper, and Copper lower Dies in our Seals (hence our reputation as Seal Manufacturers), as all others use inferior dies and counters or lower dies made of Lead, which are of no account. Send for samples of work for comparison with others, or apply to author of this book. Tingley &, Stewart Mfg. Co. Manufacturers to Ontario GoTemment, 10 KING ST, WEST TORONTO. BROWN BROS., BTA.T10NERS, Account Book Manufacturers, BOOKBINDERS, POCKET-BOOK MAKERS, &g. 64, 66, & 68 King St. East, Toronto. SpEt'iAL Attention given to the Manufacture of Account Books For Banks, Merchants, Joint Stock Companies, Insurance Companies, Loan Companies, etc., etc. On hand a full assortment of BOOKBINDING /// Every Style of the Art. Satisfaction Guaranteed. BROWN BROS. - TORONTO. Established 32 Years. ADVERTISEMENTS. coon & buitheh, 36 KlltfC STREET WEST. 3IAINTJFA.eTUlli:il» OF RUBBER 4 METAL HAND STAMPS OF EVERY DESCRIPTION. Daters, Self-Inkers, Railroad and Banking Stamps, CORPORATE, NOTARY & SOCIETY SEALS. Carvers arid (5ilde^s••^• -^^]VIirror ^ Picture pranie ]\^aiiufacturers. Fine Gold Work a Specialty. Re-GHclmg equal to new. FINE ART EMPORIUM, 'Mi HiiiL' SInM't M>hI, Toroiifo. ADVEKTISEMENTS. W. STAHLSOHMIDT & 00. fEESTON, ONTA.RIO, MANUFACTURERS OF oV d^ r^' &/ ay i-'oirivFi^/riDHiDi^Te, J. C- FORBES. Ezecutor for the Estate, 163 Queen Street West, OPPOSITE AVENUE. ROOFING MATERIALS WHOLESALE & RETAIL. >. JohnBurns&Sons' CARRIAGE WORKS. 104 JOHN STREET, TORONTO. All work manufactured Irom thr> best material and Onishod with NOBLE 8l HOAR'S 'fe-^ LNULISH VARNISH. Bingham D. BINGHAM • • & • • V^EBBER R. C. WEBBEK 251 ^Ac\a «nI,K A'ir.NTS Fon Warren's Anchor Brand Asphalt Roofing. 'I i-.u-i MK )NI': r. 11. JOINT STOCK COMPANIES' MANUAL, For the vse of shareholders, directors and officers of com- panies, AND THE GENERAL PUBLIC : CONTAINING PRACTICAL INFORMATION AS TO THE STEPS TO BE TAKEN AND THE PROOFS TO BE FURNISHED IN APPLYING POM A CHARTER OF INCORPORATION UNDER THE ^ctci of the ^Jrolimce of ©ntario 1)03I1NI0X OF CANADA, RELATING TO THE FORMATION OF lOINT STOCK COMPANIES BY LETTERS PATENT, TOGETHER WITH INFORMATION RESPECTING THE ORGANIZATION, MANAGEMENT, CARRYING ON AND WINDING UP OF SUCH COMPANIES, 3lnfl a numtifv of ^onn,$ and ^y-lau';5' .suitable for the xi^t thcitof. J. D. WARDE, OF THE PROVINCIAL SECRETARY'S DEPARTMENT, TORONTO. THIRD EDITION, REVISED AND ENLARGED, HUNTER, ROSE .V: COMPANY 1888. ?;^ BY KIND PERMISSION, RESPECTFULLY INSCRIBED TO THE HONOURABLE ARTHUR STURGIS HARDY, QC, M.PP., SECRETARY OF THE PROVINCE OF ONTARIO, BY fhc :2\uthov. I w I \ PREFACE TO FIRST EDITION, Having for some years, in connection with his duties in the Provincial Secretary's Department, had charge of the applications for charters under the Ontario Joint Stock Companies Letters Patent Act, and noticing the small per- centage of such applications that were in proper form, it oc- curred to the writer that a work containing practical informa- tion respecting the steps to be taken in the formation, incor- poration and management of a Joint Stock Company would be of advantage as well to intending applicants and the general public, as to Directors, Shareholders and Officers of existing companies. With this olject in view, the following pages have been prepared. They contain such of the Acts of the Letjislature of Ontario relating^ to the formation of Joint Stock Companies, with explanatory notes, as it was thought desirable or necessary to give in a work of this size. A table of forms, suitable for use in the incorporation and management of a company, together with copies of the Let- ters Patent and Supplementary Letters Patent, as now issued, has been added. Chapter 150 of the Revised Statutes of Ontario has been taken as the l)asis of the work, and for con- venience it has been divided into Chapters or heads. The writei' is indebted to George E. Lurasden, Esq., As- sistant Provincial Secretary, for some valuable suggestions as to the preparation of the woi"k. He trusts it may be found of use, not only to members of the legal profession, but to all interested in Joint Stock Companies. J. D. W. Toronto, Julv, 188 1. PREFACE TO THE THIRD EDITION. The fiivounilile opinions expressed regarding the useful- ness of this work are exceedingly gratifying to the authcji. The Revision of tlie Statute Law of ( )ntario which has iust been completed rendered another edition necessary, and the occasion has been taken advantage ot" toalication thereof in Ontario Gawtte .... 72 ]<■.. liy-law of Company regulating the calling of a general meet- ing 7^^ 17. Aflidavit verifying same ....... 74 18. Notice in local newspaper calling general meeting . 74 19. .\ftidavit verifying same ....... 75 18. Notice in Ontario Oazette calling meeting .... 74 20. Affidavit verifying same ....... 75 19. Affidavit proving due calling of meeting .... 75 27. Notice of publication of by-law in Ontario Oazette. >^0 TO I»K(.'KKASK THE NTMIIEU OF HI llElToH-S. The Haine foriuH are necessary as for increasing, and tlmse given above may bo adapted. KollMS l(,K lU.MOVINil < im.l ri.Ai'K OK Ill'.IINESs. 14. By law of Directors for ri'moval . . .71 15. AHidfivit verifying by-law, proving sanctioning of Hiune and publication thereof in Onttirio Oir.ittr 72 10. By-law of f'f)mj(any regulating the calling of a general mt>et- «"K 73 17. Aflidavit verifying wame ...... 74 18. Notice in local newHpaper calling general mooting. 74 19. Affidavit verifying uamo. ....... 75 18. Notice in Ontario da ill< culling general mof mocting .... 75 27. Notice publishing by-law in i.hilario (la.fitf. HO CONTENTS. * FORMS FOR CHANGING THE NAME OF A COMPANY. PAGE 28. Notice in Ontario Gazette of intention to apply for an Order in-Council changing corporate name. .... 81 28. Notice in local newspaper of same . . . . .81. 29. Affidavit proving publication of notice in Ontario Gazette. . 81 29. Affidavit proving publication of notice in local newspaper. . 81 30. Petition for change of name ...... 82 31 . Affidavit verifying same ....... 83 32. Affidavit verifying signatures to petition. .... 83 33. Evidence of Company's solvency ...... 84 MISCELLANEOUS FORMS. 34. Letters Patent. ........ 35. List of Shareholders ....... 36. Affidavit verifying Summary and List Shareholders. 37. Notice of granting Letters Patent — Schedule A to Act 38. Notice of granting Supplementary Letters Patent — Schedule B to Act 39. Proxy 40. Power of Attorney to make transfers, receive dividends, etc, To re- incorporate a company under the 72nd and 73rd sections to subdivide the shares ; extend powers ; limit or increase the amount that may be borrowed on debentures, or other wise ; or provide for the formation of a reserve fund, forms may be adapted from those given above. 84 87 88 50 51 88 89 TABLE OF STATUTES. An Act respecting the Incorporation of Joint Stock Companies by Letters Patent, R. S. O., Cap. 157 An Act respecting the changing of the names of incorporated Companies, R. S. O., Cap. 178 94 An Act respecting the winding up of Joint Stock Companies, R. S. O., Cap. 183 qq By-laws, set of ......__ j)q APPENDIX. Dominion lii oislation : — An Act respecting the Incorporation of Joint Stock Companies by Letters Patent 126 Instructions for forming a company under the Dominion Act . 154 INTEODUCTORY. A Joint Stock Company is an Association of a number of individuals for the purpose of carrying on some legitimate business — each member subscribes and pays for shares in the capital stock and the responsibility of shareholders for the liabilities of a company does not extend beyond ihe amount of stock subscribed for. If that be paid up in full no fur- ther calls can be made ; if not fully paid up, shareholders can be compelled to pay in full the sum of the shares subscribed for. This lialnlity is known as " Limited Liability," and is the position shareholders in Joint Stock companies, other than Banks, occupy!^ The first step usually taken in the formation of a com- pany is the publication of aProspectus. This, though a com- mon, is not an essential, preliminary to the promotion and formation of a company. The Prospectus is intended to set forth to the public such details of the proposed scheme as will enable them to judge of the advisability, or otherwise, of taking part in it. It should be short and pointed. As a heading it should have the name and capital of the com- pany. Its advantages, prospects and the plan on which it is proposed to be worked should be stated. An Application for Shares is usually appended. Subscription of stock may then be seciu-ed by means of the stock book as given at page 69. The use and value of this book is so apparent that it is unnecessary to say more than that it binds and makes responsible the subscribers thereto. When a sufficient amount of stock has been subscribed select iThe position of shareholders in Banks differs from this and may be de- scribed by the term "Double Liability" that is — the owner of five paid up shares of one hundred dollars each would, in the event of the Bank's failure, be liable to be called upon to pay in five hundred dollars in addition to the money already invested. Form 1, Post, 6 INTRODUCTORY. a small number, not les.s than live, ut" the shareholders who are to be the applicants for the charter. Then prepare the notice for the Ontario Gazette and the other forms required for obtaining incorporation, as given at page 12. If these proofs are satisfactory to the Provincial Secretary's Depart- ment, the charter will issue in due course. Instalment lists and scrip should be prepared for receipt of calls on the stock, and a .set of By-laws for the government of the company di-awii up in the form given at page 90. The charter hav- ing been obtained and these preliminary matters settled, it is competent to the company to commence business forthwith. Parties having business to transact with the Provincial Secretary's Department will save time any pay- ing attenticju to the following directions. All c<»nniiuiiicatioiis on olHcial Inisiiicss sliuuM be ad- dressed to The Honoura1)le The Provincial Secretary, Toronto, and the postage must be |)repaid. i^ctters mai'ked U. 11. M. S. are usually sent to the Dead Letter OfHce. The forwai'ding of any paper should always be accf)mpan- ied by a letter, each letter should be confined to one subject, the po.^t e remembered that the lietti^r jiapcis aie execut- ed, the .sooner the work is despatched at the otiice. The use of foolscap paper in preparing aj)j)lications for Letters Patent, etc., is strongly recommended, as being much fnore convenient than larger sheets. The JrjJMt Stock ( 'oMi|iuni<;s' Act ileclares that nt) steps sliali b(« taken in any Dejiartnient tou'ai(N the issue of any Letters I'atent or Suppb.'nientary Jj(!tters Patent unfit aj'tf.r aU fnfM therefor have l;een duly paid. Remittances, including, wliere necessary, charges for col- lection, must be made by registered letter, or they are at the INTRODUCTORY. 7 risk of the sender. Post office orders, accepted bank-cheques and drafts must be drawn payable to the order of the Pro- vincial Secretary. Notices for publication in the Ontario Gazette should be addressed to The Business Manager, The Ontario Gazette, Toronto, Ont. and should indicate the number of insertions required. The rates are eight cents per line for the first insertion, and two cents per line for each subsequent insertion. The charge for a single number of the Gazette is ten cents. Advertisers desiring one or more copies to be furnished them should remit to the manacrer at this rate. CHAPTER I. FORMATION. AND INCORPORATION OF COMPANIES. 1. Citation. 2. ixterpretation of act. 3. Granting Powers to Companies Incorporated Under Imperial Acts. 4. How Incorporated. r>. Nature of Application. 6. Petition and Contents. 7. Evidence of Petition, Notices, &c. 8. The Letters Patent. 9. Notice of Granting Letters Pa- tent. 10. Lieutenant Governor may change name. 11. Certain Informalities not to Invalidate Letters Patent. 12. General Powers. 13. Change op Name or Constito- TION. 14. Supplementary Letters Patent. 15. Powers to be Subject to Act. All Act respecting the incorporation of Joint Stock Companies by Letters Patent. (Cap. 157, Revised Statutes of Ontario.) HER Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows : — 1. — CITATION. 1. This Act may be cited as Companies' Letters Patent Act." The Ontario Joint Stock 2. — INTERPRETATION OF ACT. 2, Where the words following occur in this Act, and in all letters patent and supplementary letters patent issued under the .same, they .shall be construed in the manner here- inafter mentioned unless a contrar}' intention appears. 1. " The letters patent " .shall mean the letters patent in- corporating a company for any purpose contemplated by this Act ; 2, " The supplementary letters patent " shall mean any letters patent granted to the company subsequent to the let- ters patent, incorporating the company ; 10 JOIKT STOCK companies' MANUAU 3. " The company " shall mean the company so incorpor- ated by letters patent ; -t. " The undertaking " shull mean tlie whole of the works and business of every kind which the company is authorized to carry on ; o. " Real estate " or " land " shall include all immovable real property of every kind ; G. " Shareholder " shall mean every subscriber to, or holder of, stock in the company ; and extend to, and include, the personal representatives of the shareholder. 3. — GRANTING POWERS TO COMPANIES INCORPORATED UNDER IMPERIAL ACTS. II. — 1. In ca.se a corporation, now or hereafter incorpor- ated under the laws of the Imperial Parliament of Great Britain and Ireland, desires to carry on any of its business within the Province of Ontario, the Lieutenant-Governor in Council may, by letters patent under the Great Seal of the Province, grant to such company, and such company may thenceforth use, exercise, and enjoy within the Province, any powers, privileges and rights set forth in the letters patent, as desired in or for carrying on the business of the company, and which it is within the authority of the LicutenaMt-(!any, verified in the manner which may be satisfactory to the Lieutenant-Ciover- nor in Council. 3, 'J'he letters patent referring to such Act, charter or otiier instrument as aforesaid, or a copy of such Act, charter or other instrument nf[)licants may petition tlie Lietitt'iiant (lOVeiiKJi-, through the I'lovincial Secretary, lor the is.sue oi the letters patent; L'. The petition nni.st .state tlie facts rei|uii-eil to he set forth ill the notice, ami must fnrtlier .state the anioimt of stock taken \>y each applicant, ami also the ammnit if any, paiil in upon the stock of each aj»plicant '.\. The petiti r>tt. FORMATION AND INCOHPORATION OF COMPANIES. 15 elation, signed by all the persons whose names are to be so inserted, or by their atttorneys, lawfully authorized in writing, and such memorandum shall contain the particulars required by the next preceding section; 5. The petition may ask for the embodying in the letters patent of any provision which otherwise under this Act might be embodied in any by-law of the company when incorporated. The petition must reach the Provincial Secretary not later than one month after the last publication of the notice. If, through the absence of one of the petitioners or from some unavoidable cause, the whole of the papers cannot be completed within the month, the petition should be forwarded and the balance of the papers transmitted immediately upon completion. Where delay does occur, it is usual to require an explanation thereof, and in case more than a month elapses before the petition is presented, an additional insertion of the notice in the Ga- zette is ordinarily accepted, but for special and sufficient reasons the head of the department may dispense with this. No person can be a petitioner unless his name appeared in the notice, and every petitioner must be a shareholder in the proposed company. At least five share- holders must join in the petition. The petition^ should in every respect correspond with the notice in the Gazette. It should be legibly written, and should state (a) the names in full of the petitioners, with their residences, legal additions or occupations ; (6) the proposed name of the Company to be incorpor- ated ; (c) its objects ; (d) the place or places in Ontario where its oper- ations are to be carried on ; (e) its chief place of business ; (/) the amount of its capital stock ; (pr) the number and amount of its shares ; (Ji) the names of at least three directors who must all be shareholders ; (i) the amount of stock taken by each of the petitioners, the amounts, if any, paid in thereon, and whether they were paid in caih, by the transfer of property, or how otherwise. The petition should be signed by each of the applicants personally, or if, in any case, by attorney, the power of attorney, duly authenticated, should accompany it. Blank Forms of Petition may be obtained on application to the Secre- tary's department. The subscription of stock must be proved by production at the Sec- retary's Department of the stock book^ with the signatures of the sub- scribers duly verified, ■' and a verified copy of such stock book must be 1 Form No. 7, post. -Form Xo. 11, post. •^Form No. 12, post. in JOINT STOCK companies' MANUAL. transmitted therewith, to remain on file in the Department. After comparison, the original is returned to the applicants. The stock book may, according to the nature of the company, be of any size, from a large volume, to a simple memorandum book. The copy should be made on foolscap paper. The object of embodying in the letters patent any provision which otherwise might be embodied in any by-law of the company when in- corporated is, " to give greater stability to these matters which it may be deemed desirable so to embod}' and which, as by bj'-law, would be always subject to change according to the whim or caprice of a major- ity of the directors."' H. Where a notice has been published according to tlie rule.s of the Legislative Assembly for an Act incorporating any company, the incorjtoration whereof" is .sought for ob- jects for which incorporation is authorized by this Act, and a Bill has been introduced into the A.ssembly in accordance with such notice, and is subsequently thrown out or with- drawn, then in case a petition to the Lieutenant-! }ovcrnor for the incorporation under this Act of the company is filed with the Provincial Secretary within one month from the day of the termination of the Session of the Assembly for which tlie notice was given, the notice may be accepted in lieu of the notice required by section six. 9. The Lieutenant-Governor may dispense with the pub- lication of the notice menti8t«|.henii' "Joint Stock CompuniiH," \>. 120 FORMATION AND INCORPORATION OF COMPANIES. 17 name is not the name of any other known incorporated or unincorporated company. 11. — 1. The Provincial Secretary, the Assistant Provincial Secretary, or such other officer, may for the purposes afore- said, or for any other purpose under this Act, take and keep of record any requisite evidence in writing under oath or affirmation. 2. Proof of any matter which may be necessary to he made under this Act, may be made by affidavit or deposition be- fore the Provincial Secretary, or Assistant Provincial Secre- tary, or before any Justice of the Peace or Commissioner for taking affidavits, or Notary Public, who are hereby author- ized and empowered to administer oaths for that purpose. Proof as to the notice required having been given must be furnished by affidavit^ setting forth dates of insertion of such notice, with copy thereof, cut from the Gazette, attached. Each signature to the petition must be verified by affidavit^ made by the witness. The proof that the corporate name is not that of any other known incorporated or un- incorporated company ought to be made by the affidavit of one of the applicants, a resident of this Province, or by a resident attorney or agent.* From the nature of the subject such affidavit cannot be posi- tive and should be expressed to be made to the best of the knowledge and belief of the declarant. 8. — THE LETTERS PATENT. 12. The letters patent shall recite such of the material averments of the notice and petition so established as the Lieutenant-Governor may find convenient to insert therein, and the Lieutenant-Governor, may, if he thinks fit, give to the company a corporate name different from the name pro- posed by the applicants in the published notice ; and the objects of the company as stated in the letters patent may vary from the objects stated in the said notice, provided the objects of the company as stated in the letters patent, are of a similar character to those contained in the notice pub- lished as aforesaid. 1 Form 6, post. - Form 10, post. ' Form G, post. 18 JOINT STOCK companies' MANUAL. lu case a company has given notice under a name to which reason- able objection has been, or may be, taken, this clause provides for avoiding the delay that would be caused by giving a new notice. A copy of the form of letters patent is given hereafter.^ 9. — NOTICE OF (iHANTlV(; LETTERS I'ATENT. Hi. Xotiee of the granting of the letters patent shall be forthwith given by the Provincial Secretary, in the Ontario Gazetft\ in the form of the schedule A to this Act ; ami from the (lute of the letters patent the persons therein named and their successors shall be a body corporate and politic by the name mentioned therein. This notice is inserted in the (Uizdtc without charge to the applicants. 10. — LIEUTENANT-GOVERNOR MAY CHANGE NAME. II. In case it is made to appear that any company is in- corporated under a name, the same as or similar to, that of an existing company, it shall be lawful for the Lieutenant- Governor in Council to direct the issue of Suj)plrmentary letters patent reciting the former letters, and changing the name of the company to some other name to be set forth in the Supjjlcmcntary letters patent; and no such alteration of namt" shall atii-ctthc i-ights or obligations of tin' company ; and all proceedings may Ijc continMe(l and commenced by or against the C(jmpany by its new name, that might have been continued or commenceil I'V or against tin; eompany by its former name. 2. 'I'he High (Jouit may compid an appliealion under tliis section wltenever a company impropeily assumes the name of, or a name similar to, that of an existing coiii|iariy. Th« company whuMn name is thus chaiiKcd in tliat hiHt incorpurated, the earlier oiiijiaiiy having a right te retain itn name, while no com- pany iiubH<-(|uuntIy incorporated has a right to asstime a name so siiui- lar to that I'f nn existing cnmi>any ns to endanger one being mistaken for the i.tfier Thun in //■/./i.i v. Unhnrn Mitnufurluriini Coiiifiini]/, in the United SlAtes, it wiM decided, that whore the name of a m.iiiuraoluring cor- • Form ;M, po>l. FORMATION AND INCORPORATION OF COMPANIFS. 19 poration had beeti used to designate tke origin and ownership of the goods manufactured by it, such use of its name would be protected to the same extent, and upon the same principle that individuals are protected in the use of trade marks. ^ 11. — CKUTAIN INFORMALITIES NOT TO INVALIDATE LETTERS PATENT. 15. The provisions of this Act relating to matter prelimi- nary to the issue of the letters patent shall be deemed directory only ; and no letters patent or supplementary let- ters patent issued under this Act shall be held void or void- able, on account of any irregularity in any notice prescribed by this Act, or on account of the insufficiency or absence of such notice, or on account of any irregularity in respect of any other matter preliminary to the issue of the letters patent or supplementary letters patent. 12. — GENERAL POWERS. 16. Every company so incorporated may acquire, hold, alienate and convey real estate subject to any restrictions or conditions in the letters patent set forth, and shall forth- with become and be invested with all rights, real and per- sonal, heretofore held by or for the company under a trust created with a view to its incorporation, and with all the powers, privileges and immunities requisite to the carrying on of its undertaking, as though the company had been in- corporated by a special Act of the Legislature making the company a body politic and corporate and embodying all the provisions of this Act, and of the letters patent. lo. — CHANGE OF NAME OR CONSTITUTION. By Sec. 7'of Cap. 178, entitled an "Act respecting the Changing of the Names of Incorporated Companits," that Act is declared to apply to any company incorporated under the Joint Stock Act, if such com- pany has made or makes an application thereunder. In such case the following steps are necessary : 1 Stephens, p. 147. 20 Joint stock companies" manual. The company sliuuld petition the Lieutenant-Governor in Council, setting forth the facts, and stating : 1. That the company is desirous of changin^f its name from . to ... . 2. That the proposed name is not the name of any other known incorporated or unincurporate>l c impany. 3. That the company is in a solvent condition. 4. That the change desired is not for any improper purpose. If the applicants are a trading corporation or company carrying on a businesfl for profit. 6. That notice^ of the intention of the company to apply for a change of name has been inserted for four weeks in the Or.tarin Gaxettc, and in a newspaper published in the locality in which the operations of the company are carried on. These facts should be verified by affidavit. The petition should be signed by the president and secretary, and sealed with the company's seal. Evidence of the solvency of the company should be furnished by a balance-sheet or other satisfactory statement of the affairs thereof. FORMS FOR CHANOINO THK NAME OF A COMrANY. Notice in Ontario dazi^tte of intention to apply for an ()rder-in-Council changing corporate name. . Ftirm No. "JS- Notice in local newspaper of same. .... " 28. Afliddvit proving publication of notice in Onturiu Giuette. " 29. Affidavit proving publication of notice in local newspaper. " 21>. Petition for change of name. ..... " '.W. Affidavit verifying same. . '■ 'M. .•\ffidavit verifying signatures to petition. ... :<2. Kvidt-ricc of Cotiipaiiy's solvency. '.V^. 17. Tlu; (liructor.s of Lhu company may at any Liniu make a l^y-law .sub-dividing the exi.stinj,' shares into shares of smaller umouiit. IH. 'I'Im- directors of tlie company, at any time after nine- tenths of the capital stock of tlie comp.my has heen taken up, and ten ])er centum thereuj)on paid in, hut not sooner, may nuike a liy-law for increa-sin/.^ the capital .stock of the company to any amount which they consider requisite for t)>e due carryin;,' out of the ol)jeets of the company ; The hy-lawVshall «leelare the number and value of the share« of the new stock, and may prescribe tlio iiiMmicr in • K 18. t( 19. i( 18. t ( 20. .1 19. (( 20. (( 21. (( 22. (( 23. (1 24. <( 25. 22 JOINT STOCK companies' MANUAL, cient for the due airryiiig out of the undertaking of the company, an 1 advisable ; TO I>KCREASE THK ('Al'lTAL STOCK. The saiuj forms are neceaaary aa for increasing the capital, and those given for that purposj may be adapted. '2. The by-law shall declare the number and value of the shares of the stock as so decreased ; and the allotment thereof, or the rule or rules by which the same is to be made ; *}. The liability of shareholders to persons who were, at the time of the re• Affidavit verifying Hame "17. Notice in local nowspafjor calling general meeting. " 18. Affidavit verifying same " l'.». Notice in '>/'''<»i'> ^'«<;«;<<»' calling general meeting. 18. Affidavit verifying Hanii- " '-(>. AHidavit [(roving duo calling of meeting. ... " 1'*. Notico publishing by-law in Ontario Gazette. 1.'7. •2<» In case u resolution, untliori/in-^'an iipplicuLion Lo the Lit;nt<:niint-(iy pro.xy at a general meeting of the company, (Inly called for considerin;^ the sniijcct of such resolution, tlic Lient<."nant-(iovernor in (Council may from time to time, to the amount, in the manner, and subject to the eunditions set forth by such by-law ; and th.e whole of the stock, as so increased or decreased, shall become subject to the provisions of this Act, in like manner (so far as may be) as though every part thereof had formed \y,\rt of the stock of the company orii,dnally subscribed. 24. Sections lis and 20 to 23 of this Act shall apply to everv company which has been incorporated by a special Act for purposes or objects w^itliin the scope of this Act. 15. — POWERS TO HE SUIUECT TO ACT. 5J8. All powers given to the company by the letters patent, or supplementary letters patent, shall be exercised subject to the jtrovisions and restrictions contained in tliis Act. CHAPTER II. ORGANIZATION AND MANAGEMENT. 1. Directors. 2. Meetings. 3. Powers op Directors. 4. By-Laws. 5. Books to be Kept, 6. Statement OF Affairs to be MADE. 1. — DIRECTORS. 21>. The affairs of every such company shall be managed by a Board of not less than three directors. The directors are appointed to direct and manage the affairs of the company ; collectively they form a board of directors. To make a legal board of directors they must meet at a time when and a place where every director has the opportunity of attending to consult and be consulted with. They are required to use due diligence and give attention to the concerns of the company, and are bound to a faithful discharge of the duty which the situation imposes. They are liable to the stockholders whenever there has been gross negligence or fraud, but not for unintentional error. ^ 30. The persons named as directors, in the letters patent, shall be the directors of the company, until replaced by others duly appointed in their stead. 31. No person shall be elected or appointed as a director thereafter, unless he is a shareholder, owning stock abso- lutely in his own right, and not in arrear in respect of any call thereon. 32. The after directors of the company shall be elected by the shareholders in general meeting of the company as- sembled at some place within this province, at such times, in such wise, and for such term, not exceeding two years, as the letters patent, or (in default thereof) the by-laws of the company may prescribe. 351. In default only of other express provisions in such behalf, by the letters patent or by-laws of the company; iThring. 28 JOINT STOCK companies' MANUAL. 1. Such elections shall take place yearly, all the members of the board retiring, and (if otherwise cjualitied) being eli- gible for re-election ; No By-law for the payment of the president or any director, shall be valid or acted upon until the same has been contirnied at a general meeting. ^ 2. — MEETINGS. In default only of other express pvovisions in such belialf by the letters patent or b^'-laws of the company. 2. Notice of the time and place for holding general meet- ings of the company shall be given at least ten days previ- ously thereto, in some newspaper published at or as near as mav be to the office or chief place of business of the com- pany, and also in the case of companies having a capital ex- ceeding S3,0()0, either by publishing the same in the Ontario Gazette, or by mailing the same as a registered letter, duly addressed to each shareholder, at least ten days previous to such meeting ; 3 At all general meetings of tlie company, every share- holder shall be entitle.f (iirrctmH to iiiiiki' hy Iiiwh. '). — HOOKS K) UK KKl-l". •50. Till' e()iii|iaiiy hIimII cause a book or books to bo kept by the secretary, or l)y sijuk; other ollicer espeeijilly charged with tliat duty, wherein shall be kept n.cor(h;d : ' Fur ••t "f \>y \mw» miitAlilv for ciiiii|>any'it tine non infra. ORGANIZATION AND MANAGEMENT. 31 (a) A copy of the letters patent incorporating the com- pany, and of any supplementary letters patent issued to the company, and of all by-laws thereof ; (6) The names, alphabetically arranged, of all persons who are, or have been shareholders ; (c) The address and calling of every such person while such shareholder ; (d) The number of shares of stock held by each share- holder ; (e) The amounts paid in, and remaining unpaid, respec- tively on the stock of each shareholder ; (/) All transfers of stock, in their order as presented to the company for entry, with the date and other particulars of each transfei", and the date of the entry thereof ; and — (g) The names, addresses and calling of all persons who are or have been directors of the company ; with the several dates at which each person became or ceased to be such director. 53. Such books shall, during reasonable business hours of every day, except Sundays and holidays, be kept open for the inspection of shareholders and creditors of the com- pany, and their personal representatives, at the office or chief place of business of the company ; and every such share- holder, creditor, or representative, may make extracts there- from. 54. Such books shall be prima facie evidence of all facts purporting to be thereby stated, in any action or proceeding against the company or against any shareholder. 55. No director, officer or servant of the company, shall knowingly make or assist to make any untrue entry in any such book, or shall refuse or neglect to make any proper entry therein ; and any person violating the provisions of this section shall, besides any criminal liability which he may thereby incur, be liable in damages for all loss or injury which any person interested may have sustained thereby. 32 JOINT STOCK COMPAMKS' MANUAL. 56. Any director or otiicer who refuses to permit any per- son entitled thereto to inspect such book or books, or make extracts therefrom, shall forfeit and pay to the party ag- grieved the sum of one hundred dollars ; and in case the amount is not paid within seven days after the recovery of judgment, the court i» whicli the judgment is recovered, or a judge thereof, may direct the imprisonment of the offend- er for any period not exceeding three months, unless the amount with costs is sooner paid. The»e sections contain all the provisions of the act directly concern- ing the books of the company. As a matter of course and necessity, every enterprise of any importance, whether individual or associate, must include books in which a record of its proceedings and of its affairs is kept. But particularly so in connection with Joint Stock en- terprises, in which the means of a lesser or greater number of persons taking no active part in the management of its atlairs and who are de- pendent upon such books for a knowledge of its affairs, are involved ; and also where the liability of the members individually towards the creditors of the enterprise is limited to the amount unpaid on their shares. These causes together render the keeping of books by Joint Stock Companies a matter of so much importance that the legisla- ture has not only made it compulsory to keep such books, but has described in detail what such books shall contain and exhibit, and im- posed penalties for neglect of such provisions. ^ G. — STATEME.N'T Ol' AFFAIRS TO UK .MADK. 57. Mvery company incorporated under this Act shall, «>n or bi.'fore the first day of February, in every year, make a list in duprK;atc verified us is hereinafter re(|uired of all i)er- soris who on the thirty-first d.i}' of r)t'eember previou.sly, were shareholders of the' eoiiipauy ; and such list shall state thi- names alphalietically arraii'4t!rovisions of this Act ; and the other duplicate list and summary, veri- fied as aforesaid, shall be deposited with the Provincial Secretary, on or liefore the eighth day of February next, after the time hereinbefore fixed for mukiiii,^ the .summary. 7. If a company makes default in i-omplyiuL,' with the pro- visions of this section, the company shall incur a penalty of twenty dollars for every day during which the default con- tinues, and eveiy director, manager or secretary of the com- pany, who knowingly and wilfully authorizes or jjermita such default, shall incur the like penalty. 8. This section .shall not apply to any company until the first day of Febiuary m^xt after the first thirty-first day of I>eceml>er, after the conii»aMy has bcm organized, or has g«jne into actual opeiation, whicln-vei- ^hall first happen, an which this Act a|»pli('s did not transjict any Vjusine.HH Cother than the paymiiit of taxes or the making of a return, or tlio furnishing of uny list, stjitement, or other information to the Oovermm nt of Ontario, or to any oflirer or d»-partm<-nt thereof; during tht^year for which it isallcgt.'d a return in acfoidain-e with the n^quirementsof law has not bff'ti inadf, -lUch rf)tiij»any shall In; deemed tn have ceased to cany on bu.sinesH within the meaniiig of this subsection. ORGANIZATION AND MANAGEMENT. 35 Blank forms of summaries, lists and affidavits are forwarded annual- ly to companies by the Secretary's Department in ample time for mak- ing the return. The sheets should be fastened with a clip, or pin, not gu°mmed together. Chapter 180, provides that no action for default in making return shall be maintained after receipt of return by proper officer, and also limits the amount of the penalty that may be recovered for default. CHAPTER III. STOCK, CAl LS, ETC. 1. NATfRE OF Stock. j 7. Li ability of Execvtors. 2. Allotment OK .Stock. | 8. Rights of Execltohs. 3. Creai ion of Preference Stock. 1>. Calls. 4. Sale AM) Transfer ok Stock. 10. Action for Calls. .I. Liability of Cumtany in respect 11. Forfeiture of Shares. OF Trusts. 12. Dividends. G. LiABiLiTT of Shareholders on | Stock. 1.— NATURE OK STOCK. 11. The .stock of the company shall be deemed personal estate, and shall be transferable in .such manner only, and subject to all such conditions and restrictions as by this Act, or by the letters patent, or by-laws of the company may be prescriljed. 2. — ALLOTMENT OF STOCK. VZ. If the letters patent make no other definite provi- sion, the stock of the company, so far a« it is not allotted thereby, shall Ite allotte. — The directors of the company shall not decline or pay any dividend when the company is insolvent, or any STOCK, CALLS, ETC. 41 dividend, the payment of which renders the company insol- vent, or diminishes the capital stock thereof, but if any director present when such dividend is declared, forth- with, or if any director, then absent, within twenty-four hours after he has become aware thereof and able so to do, enters on the minutes of the Board of Directors his protest against the same, and within eight days thereafter causes such protest to be published in at least one newspaper pub- lished at or as near as may be possible to the oflSce or chief place of business of the company, such Director may thereby, and not otherwise, exonerate himself from liability. This section is for the protection of the creditors of the company. " The rule with regard to the rights of creditors in this respect was well stated in a case in the United States Supreme Court, in which it was said that the property of a corporation is regarded as held in trust for the payment of its debts, and creditors may pursue it into the hands of all persons, except those of bona fide purchasers ; nor will a sale of the capital stock and a division of the proceeds among the stock- holders defeat the rights of creditors, but such stockholders may be compelled to contribute pro rata to the payment of the corporate debts out of the moneys so received. " The term ' dividend ' really means and refers to that which is to be divided among the shareholders, and that only which properly be- longs to and can be divided among the shareholders is the fund created by the net profits of the company. It is for this and this only they have invested in its shares, and if, contrary to their expectations, there are no profits, then they must wait until there are ; or if there is no reasonable expectation of there being any, then the company should be wound up, and after the creditors have all been paid, they may divide the surplus assets among themselves. But having induced and obtained credit on the strength of the capital fund which they have contributed, it would be manifestly unjust to allow them to withdraw such capital or any part thereof, either by the name of dividends or any other name, as soon as they see that their expectations are not likely to be realized. " The guaranteeing of a dividend by a company means nothing more than a pledge upon the funds applicable to the purposes of a dividend ; and if in any case it appear that the dividend has not been earned, the holders of stock upon which a dividend is guaranteed cannot recover in a suit to inforce payment of such dividend. As long as the com- pany is earning sufficient to pay a satisfactory dividend, there is no C 42 JOINT STOCK companies' MANUAL. temptation to draw upon the capital for that purpose ; but as soon as it falls below that, the interest of all, but especially of the large share- holders, creates a strong temptation to pay bogus profits out of capital in order to maintain the credit of the company and the price of its shares. And it is this temptation, clearly, which has caused the Legis- lature to remove the (juestiou out of the domain of company regula- tion, and, by one short provision, make every payment of dividends out of any thing but the actual profits of the company illegal. The capital then belongs to and is the proper pledge of the creditors of the company, and the net profits only are all that the shareholder can claim until the company is wound up."^ 1 Stephens. CHAP ItR IV. MISCELLANEOUS PROVISIONS. 9. SoBsisTiNO Companies may obtain Charter with extexded pow- ers. 10. Appointment of Companies to ACT AS Trustees, &c. 11. Letters Patent for certain pur- poses may be GR\NTEn TO COM- PANIES incorporated under Special Acts. 12. Winding up Acts to Apply. 1. Contracts, &c., when Binding on Company. 2. Company not to buy Stock in other Corporations. 3. Loans to Shareholders. 4. Liability of Directors for Wages. 5. Actions by and against Company. 6. Forfeiture of Charter. 7. Fees. 8. Provincial Secretary's Depart- ment charged with the issue of Letters Patent, &c., &c. 1. — CONTRACTS, ETC., WHEN BINDING ON COMPANY. 59. Every contract, agreement, engagement or bargain made, and every bill of exchange drawn, accepted or en- dorsed, and every promissory note or cheque made, drawn, or endorsed on behalf of the company by any agent, officer, or servant of the company in general accordance with his powers, as such under the by-laws of the company, shall be binding upon the company ; and in no case shall it be necessary to have the seal of the company affixed to any such contract, agreement, engagement, bargain, bill of ex- change, promissory note or cheque, or to prove that the same was made, drawn, accepted or endorsed, as the case may be, in pursuance of any by-law, or special vote or order ; nor shall the party so acting as agent, officer or servant of the company, be thereby subjected iudividuall}^ to any liability whatsoever to any third party therefor. 2. Nothing in this Act shall be construed to authorize the company to issue any note payable to the bearer thereof, or an}^ promissory note intended to be circulated as money, or as the note of a bank, or to engage in the business of bank- ing: or insurance. 44 JOINT STOCK companies' MANUAL. 2. — COMPANY NOT TO BUY STOCK IN OTHEK CORPORATIONS. 60. ^«o company shall ust- any of its tuiuls in the pur- chase of stock in any other corporation, unless expressly authorized by by-law confirmed at a general meeting. 3. — LOANS TO SHAREHOLDERS. 67. No loan shall be made l)y the company to any share- holder, and if such is made, all directors and other otticers of the company making the same, or in anywise assenting thereto, shall be jointly and severally liable to the company for the amount thereof, and also to third parties, to the ex- tent of such loan with legal interest, for all debts of the company contracted from ihe time of the making of the loan to that of the repayment thereof : But this section shall not apply to a building .society, or to a company incorporated for the lending of money. 4. — LIABILITY OF DIUKCTORS FOR WAGES. 68. The directors of the company shall be jointly and severally liable to the labourers, servants and apprentices thereof, for all debts not exceeding one year's wages due for services performed for the company while they are such directors respectively; but no director shall be lial)lo to an action therefor, unless the company has b(!cn suod therefor within one year after the debt became due, nor yet unless hiuch director is sued therefor within one yr.ir from ihc lime when he ceased to be such diiccLor, ntjr }'et lielore an execu- tion against the company has been returned unsatistied in wliole or in part; and the amount due on such execution .shall be the amount ifcoverablc with costs against the directors. 5. — ACTKJNS liY AM> AfiAI.NST roMl'ANY. 6!>.— In an action or other jiroceeding, it .shall not he re- «iuisite to set fortli the modi; of incorporation of the com- iiany. otherwise than by mention ,000 or less, and is not in- creasid, the fee is ^5. If the capital of the Company is mure than $3,000, a fee of $^5 is charged, unless the capital stuck of the Company is in- creased, uhen the same fee is payable as wuuld be charged if the Company vas being incorporate, but only uith reference to the increased capital. The fee to be paid by a company, whose capital is over $S/JOO, for the iS'o/ice in the *' Gazette," required by sec. 5 of cap. 17S R. S. 0., respect- ing the changi)ig of the names of companies, is $I~ ; if the capital is $3,000 or less, So. 8. — rnoviNCiAL secrctauy's department, charged WITH ISSUE OF LETTERS PATENT, ETC., ETC. The Provincial Secretary's Department is doaignatod hy Order in Council under section 71, a< the Department throui^li which tlio issue of letters patent sliall take place. 9. — SURSISTING COMl'ANlhS .MAY UliTAlN CllAKTKlMVl 111 K.\- TENDED POWERS. 7*2. .\nv coiiipiuiy iiicurporatcil i'oi' ]»ui|M)se.s or ohjects within the .scojx- of tliis Ad, or w iiliiii the scope of tliiH Act as it may ho heieatter aiiifmlL'd. whetlier under a Sj)ecial or a Geneial Act, and hein;^ at the time of its api»lication a 8uh.Hi.sting and valid ccjrporation, may apply for letters pat- ent under thin Act ; and the Lieutenant-( Jovernor in ( 'ouncil, upon jjioof that the notice (jf the a|iplication has hcen in- Herted for four weeks in the (Jntario Gazette, inuy ilirect the Ihmuo of letters patent incorporating the sliaieholders of the naid company as a company iin(hi- tliis Act, and tlicre- \i\tou all tlie ri;.,'hts or ol.li^^fations cd' tin- former company shall he transferred to flie new company, and all proceed- in;4s may l>e continm-d ane the same. 7<». 1) Tlie lli;:li < 'oiirt, if it dcctiis necfssarv, niay from time to time iij)poiiit a suital)l(! perstjii to investigate the aMiiirs and ujunagement of the ccniipany, wIkj shall report thereon to the court, and regarding the security atforiJed it) those l»y or for whom its en;,'iigem<'iits are held, ami tlie ex|)ense of such investigations sitall l»e defrayed by the company; or the court may, if it deems nece.s.sary, ex- MISCELLANEOUS PROVISIONS. 49 amine the officers or directors of the company under oath as to the security aforesaid. (2) The Lieutenant-Governor may also from time to time, when he deems it expedient, appoint an inspector to exam- ine the affairs of the company and report to him on the security afforded to those by and for whom its engagements are held as aforesaid ; and the expense of the investigation shall be borne by the company. 77. — (1) Every Court into which money is paid by par- ties, or is brought by order or judgment, may by order di- rect the same to be deposited with any such company that may agree to accept the same, and the company may pay any lawful rate of interest on such moneys as may be agreed upon, and when no special arrangement is made, interest shall be allowed by the company at the rate of not less than three per centum annually. (2) Every such company may invest any trust moneys in its hands in any securities in which private trustees may by law invest trust moneys, and may also invest such moneys (a) in the public stock funds or Government securities of any of the Provinces of the Dominion, or in any securities guaranteed by the United Kingdom of Great Britain and Ireland, or by the Dominion, or by any of the said Provinces ; (b) or in the bonds or debentures of any municipal corpora- tion in any of the said Provinces. Provided that such company shall not in any case invest the moneys of any trust in securities prohibited by the trust, and shall not invest moneys entrusted to it by any Court in a class of securities disapproved of by the Court. 11. — LETTERS PATENT FOR CERTAIN PURPOSES MAY BE GRANTED TO COMPANIES INCORPORATED UNDER SPECIAL ACTS. 78. — (1) Where any company has been incorporated by a special Act, before the 10th day of March, 1882, for pur- poses or objects within the scope of this Act, then, in case a resolution authorizing an application to the Lieuten- 50 JOINT STOCK COMPANIKS' MANUAL. ant-Governor therefor is passed by a vote of not less than two-thirds in value of the shareholders present, in person or by proxy, at a general meeting of the company, duly called for considering the subject of such resolution, the Lieutenant- Governor in Council may from time to time direct the issue of lettei-s patent to the company, eml tracing any or all of the following matters : {a) Extending the powers of the company to any objects within the scoi)e of this Act, which the company may desire ; (6) Limiting or increasing the amount which the com- pany may borrow upon debentures or otherwise ; (c) Providing for the formation of a reserve fund ; {d) Varying any provision contained in the special Act, so long as the alteration is not contrary to the pro- visions of this Act ; (e) Making provision for any othrr matter or thing in respet-t of wliich |irovisiou might have been made had the company been incorpoiated under this Act ; ('2) No power to execute the othce (jf exectitor, adminis- trator, trustee, receiver, assignee, guardian of a minor, or committee of a lunatic, shall be conferred under this section upon any company which has authority to issue debentures; and no comj)any incorporated under this Act, with power to execute such oftico, shall issue ileljentuies. 12. — WINI>IN(; \\' A< rsrn AI'l'l.V. 79. The company shall In' subject to the provisions of any Act of the Legislature for (In- winding up ol" .loint St(»ck ^.'oMipanii's. SCllKlirLK" A." (St'xiion I ;{ Ndllf h. OF (;11ANIINU I,KriKllS TATKNT. I'ublic notice is h'lfl.y given, that lUi'liT " 'Jlif Oiihirlo Joint Stock CompiinieH LeiterH J'uh'nl Act," letters patent MISCELLANEOUS PROVISIONS, 51 have been issued under the Great Seal of the Province of Ontaiio, bearing date the day of incorporating [here state names, address a.nd callinf/,of each corporator named in the letters j^ci^^nt], for the purpose of [here state the un- dertaking of the company, as set forth in the letters iia- tent\ by the name of [Jtere state the name of the company in the letters patent], with a total capital stock of dollars, divided into shares of dollars each. Dated at the office of the Provincial Secretary of Ontario, the dav of A.B., Provincial Secretary. SCHEDULE " B." (Section 23.) NOTICE OF GRANTING SUPPLEMENTARY LETTERS PATENT. Public notice is hereby given, that under " The Ontario Joint Stock Companies' Letters Patent Act," supplementary letters patent have been this day issued under the Great Seal of the Province of Ontario, bearing date the day whereby the total capital stock of [here state the name of the company] is increased [or decreased, o^s' the case may be'] from dollars to dollars [or whereby the capital stock of the company of shares of dollars each, is sub-divided into shares of dollars each.] Dated at the office of the Provincial Secretary of Ontario, this day of A.B., Provincial Secretary. CHAPTER V. GENERAL INFORMATION. 1. ("'ONCERNiNi; Directors. | 4. Al'diting. •J. Pkice of Sharks. I n. Volcheh.s. 3. Conversion of a Private Bisi- i i). Dities of an Aiditor. NESS, OR PaRT.VERSHIP, INTO A 7. tiENKRAI, l^EMARKS. Joint Stock Com PAN V. ! 1. COXCERNINc; DIRECTORS.' Can a man holding a plurality of responsible ottices eon- Hcientiously discharge the proper duties devolving upon him from each position of trust, or does he nominally pretend to do so i This cjuestion was asked a few days since by a shareholder, and doubtless, many others of the same class have often reflected upon the important matter, dismissing their conclusions with a shudder and a hope. It is not uncommon to find one man conducting a large and legitimate business of his own, connected as a director with two, three and more public companies where large financial interests demand careful watching and management in every detail. With the promoters of large financial antl commercial companies the (picstions of ability and moral rrsponsibility are lujt as a ruh; discu.s,s(Ml so far as legaids the directorate. I'ar more important is it that they shall j)lace the company under the Nhadow «»f great names. Men of influence, stand- ing and fortunr are secured, often irrespective of age and ability. In Ilngbiiid the ac(|uisition of one or two titles is usually a desid«!ratum in floating a new concern. The Earl of This jirifl tlie Mar(|uis of That permit tlie use of their names, and become the cliief guinea-pigs in the cage of directors. ( )f courno very f»!W of this class of directors ever pretend to look into tin; business — fhev ai«' content to meet ' Th'-M- r»Timrl<» ' 'iiiiiTiiitijf Itirnctorn ami t)i<-ir iliitirii, which rc<-«'iilly ap- prvi>«T, iir<' no portinrnt that I ipiote tlirm Iiere. GENERAL INFORMATION. 53 once a week or so, chat over a small luncheon, pocket a trifling fee, and overlook the books entirely. They are the much-abused figure-heads. There is the same class of use- less directors in certain Canadian companies, handling and managinrr large financial affairs. A man may be successful and clever in a business to which he has been applying himself for years ; but it does not fol- low that he will be equally useful or fortunate in helping to conduct another of which he knows nothing. There is another danger in men holding offices in several companies formed for financial business. It is possible by collusion for directors to accommodate one another or the in- stitutions they direct, and a loophole for fraud is left open which should not be forgotten in these days of commercial jugglery. Shareholders should, therefore, discountenance such an anomaly if they wish their savings to descend to their ofi- spring, as the greed for prominence, more particularly when pay is attached to it, beclouds too frequently the sense of honor which ought to influence the conduct of men holding trust positions, and as to whom the illustrious Burke once declared that " Those loho execute public pecuniary trusts ought of all men to be the most strictly held to their duty." 2. PRICE OF SHARES.^ Whether a company's shares are being sold at par, that is the full value, at a premium, or at a discount, they are always at par in the company's books, and on the par value the di- vidend is paid. The first issue of shares at the inception of a company will always be at par; subsequent issues may be offered at a premium if the old stock is above par in the market. After the stock authorized by the charter has been taken by subscribers, a company's shares are no longer with- in its own control. It has none to sell, and their real value will be the investing public's estimation of them, based upon the efficiency of the company's management, the past earn- iJohnson's " Joint Stock Bookkeeping." -,^ JOINT STOCK COMPANIES MANUAL. ings, ami an estimate of its powers in that direction in the future. If you desire to buy stock in a company whose shares liave all been taken up, you must tind some holder willing to sell, either by your own seeking or the employ- ment of a stock broker. What you pay for y(.ur shares is a private bargain between yourself and the holder, with which the company cannot interfere. If the company whose shares vou buy is a large and important concern, like a loan com- pany or a bank, the stock will be quoted on the Stock Ex- chan«e, and you will be guided in your purchase by the latest quotations. 3. CONVERSION OF A PRIVATE MUSINESS OR PARTNERSHIP INTO A .JOINT STOCK COMPANY ' In CJreat Britain within the last twenty-five years, and latterly to some extent in Canada and the United States, the conversion of private partnerships into joint stock companies has become very general. In all branches of cfimmerce you will observe such signs as " John Arnott &: Co. fLimited)," and on making incpiiry regarding the change it will generally be f(jtind that it was etiected at the death of sfjme of the original partners, whose interest in the con- cern has been inherited by a number of heirs who desire to retain the interest in the business, but Uvke no part in its management, nor incur any responsihility for its liabilities. An old-established firm that ndght otherwise cease to exist, for death dissolves a partnership, is thus preserved, the nuin- agemcnt rmiains undisturbed ; the shares are in the hands of tin- faniili«'s <»f the original ]>artners, who, without risk or anxiety, enjoy the fruits of tin- labors of those whose heirs they are. When any of these desire to sell their shares they have simply to lind a purcluiser at will. It has latterly be- come quite common for niainifacturers in the Dominion to convert their concenw into joint stock rom|iunies ; the ob- ject Using to extend their trade by the introduction of new capital, which could not be obtained on the ordiiuiry part- I Johii«oM'« " Joint HU.ik Hii.ikl<.-p|.iii«. " GENERAL INFORMATION. 55 nership, or special partnership, principle, but only on that of limited liability. The former owner will take the price of the property in paid up stock. 4. AUDITING.^ In a treatise for Joint Stock Companies, it is not inappro- priate that somethinor should be said, and a few hints given, on the important and too often inefficiently performed work of auditing. To audit, is to thoroughly examine and report upon the work of an accountant. The value of an audit rests solely upon the competence, honesty and independence of the in- dividuals who make it. If they are not thorough accountants, it is unreasonable to expect that they will be able to detect accidentally or wilfully false entries, or form an intelligent opinion of the vrork they have undertaken ; hence a report under such circumstances is the very opposite of the security desired, and which an audit by competent men would afford to a company or corporation. That auditors should be men of established character for probity it is unnecessary to point out, and that the reliance to be placed upon the work they perform is largely reckoned by their independence and their being uninfluenced by in- terested parties, is generally plain. We argue, therefore, that companies or corporations are equally bound to employ competent accountants who possess the moral qualities in- dicated, as audil ors, as they are to employ only such to keep their books. Auditors for Joint Stock Companies are appointed by the shareholders at the annual general meeting. The reason why the shareholders and not the directors should make the appointments is very plain. The officers of the company are largely controlled by the directors, and the audit being so far as this connection goes, an examination of the faith- fulness, to the shareholders, of both the officers and directors, 1 Johnson's " Joint Stock Bookkeeping." 56 JOINT STOCK companies' MANUAL. it is necessary tliat the sliareholders themselves should ap- point the auditors. Tlie duty of auditors is laid down in the company's By-Laws.^ From them we quote : " One or more auditors shall be appointed annually by the shareholders at the annual j^eneral meeting, whose duty it shall be to examine and audit the books and accounts of the company, and any and all documents having reference to the business of the company, and prepare from the company's books a balance sheet and aVistract of the company's affairs, to be submitted to the directore on the last Monday in January, accompanied ])y any recommendations or suggestions they may deem j>roper." The auditor, upon being duly ajipointed, should at once begin their duties, as a long delayed audit is far less ettective than a prompt one, particularly if only one audit takes place in the year. The proper manner of conducting an audit is to begin at the books of original entry, at the .same time using auxiliary books and examining vouchers. The Cash J>ook might be gone through for the first nmnth and compared with the vouchers : then the Day ]V)ok and .Journal cntiies <"or the same time should be compared, those of the l)ay J^ook l»eing verified (as well a.s those in the Ca.sh Book) from vouchers, documents, au.xiliary books, ase the report, as may be dcemorl pro])cr. N(;.\t the Ledger entries sliould b(! comjtaj'efj and cai-efiiiiy checked with the books from whicli thcv arc lirought, and all aiMit ions \cii- fied. 'i'he Trial l»alanci; slioiild be then c\ami!ie<|, and after that Ihe Stock Ledger, the Transfer Hook, the stubs in the Instalment Script and Stock (Jurtificatf? Hooks, and any other nuxiliaiy books, or forms not already gone thron^di in con- nection with tl e (Jash liook and .Jrurnaj. j''inally a balance sheet Mliowing the company's Ioshch and gains and its assets ' Se«' Kyl.aw», mfm. GENERAL INFORMATION. 57 and liabilities should be made out, and a report prepared, for submission to the directors. 5. VOUCHERS. To be acceptable to an auditor a voucher should not only be an acknowledgment of money paid, but there should be the proper authority for the payment, which is usually the vote of the Directors. A cheque payable to order and en- dorsed by the payee is evidence of payment to him, or a written receipt is evidence of payment ; but neither of these should suffice an auditor unless he has seen the proper record of the authorization. Auditors should place their initials upon all vouchers and papers submitted to them. This will prevent a dishonest man from using them again. 6. THE DUTIES OF AN AUDITOR.^ Public attention has of late been sharply drawn to the du- ties of persons entrusted with the care and management of the funds of shareholders, and we believe with beneficial eflfect. But of equal and weighty responsibility are the du- ties of official auditors. In England the extent of that responsibility has quite recently been discussed, and as one result the auditor of a building society has been made a de- fendant and held liable, in an action by a liquidator, for breach of duty. The position in law of an auditor is that of agent of the shareholders of a company, or of the beneficiar- ies of a trust. It is his duty, not merely to compare vouch- ers with alleged payments and certify that the books are correct, but to scrutinize and investigate every account, re- ceipt and payment on behalf of his clients. He stands be- tween the owners of the money and the disbursers of it, and he should, with careful thoroughness, examine as well as audit the manner and the purposes for which the owners' moneys have been paid and disbursed. He is also bound to investigate and satisfy himself of the actual and tangible existence of the securities which the directors and officers hold for the shareholders or beneficiaries ; and to require ^ Toronto Mail, oS JOINT STOCK companies' MANUAL. satisfactory evidence that they are actually of the value a.ssigne- C •*-i .~ DO -J2 »: 5 c^ '/: K-C ® • O ^ 'S :^^^ _>. i^ S^ 'o ■« o - - '- 5 2 ^. ^ ,1^ ■- "!i^ *» gi^l 00 1^ «~ 00 'c'^ ^^^ s a O ^ Eh >i 4= CO 5 = £ ^ J- I- a> to o o 5s 1—1 is « > c t5 I— c ;r c i* o o aylor, Est per cent. The Ilanii i>r liiui or 1 IC s S G ^- cc o c (1> i?2 H s it**; y C- j= ^ J 3 22 ~ « -»j spi J^, 1 *!H a rt ^ « «*-*"' r-r. 5 II < 7- u rt (J i >■ - u 1 o 6 >^< 0) rt c s ■A < C ^. m t2 et i B H TJ ^ T3 FORMS. 63 ji ^ ^ (I O & o ^ ^ O 00 o .yj a ■> M ^ Ek o ^t o <^ CO 02 = 2 0) 5 >^ 02 as o > o O > y: ?^ < -o 0- 'O >-> «-; ^ O O ?- *>^ w -^ ;> c '-N H M ?^ ^ O SS 5>i ^ 5>l >=> s H "I O H m "fHs o cc-^ § S H re / ndr 'A q s e ^ O Shares amnel If 1^ ?^ ^ • 1— 1 ^ r-< J^ hJ s ^ ^ 'i ^ i-J g ^ ^ • 2 ^ C «. ^ '-0 S ^ 5 ■^i s == -^ 64 J(JINT STOCK COMPANIES MANUAL. FORM No. 5. NOTICE OF INTENTION TO APPLY FOR LETTERS PATENT. Public notice is hereby given that, within one month after the last publication hereof in the Ontariv G7, entitled " The Ontario Joint Stock Companies' Letters Patent Act,"' constituting your Petitioners and such others as may become shareholders in the Company thereby cre- ated, a body corporate and politic under the name of " The Hamilton S:ove Company. " 2. That your Petitioners, in accordance with the provisions of Sec- tion of the said Revised Statute, have given at least four consecutive weeks' notice- in the Ontario Oa:tt(f, of your Petitioners' intention to apply for Letters Patent as aforesaid. 3. That the object for which incorporation is sought by your Peti- tioners is to manufacture and sell stoves. 4. That the operations of the said Company are to be carried on at the said City of Hamilton, which is within the Province of Ontario. 5. That the chief place of business of the said Company is to be at the City of Hamilton aforesaid. (3. That the amount of the capital stock of the said Company is to be two hundred thousand dollars. 7. That the said stock is to be divided into four thousand shares of tifty dollars each. 8. That the said William .John Thomas, Thomas Taylor and Thomas Bright Taylor are to be the lirst Directors of the said Company.* '.}. That your Petitioners have taken the amount of stcjck set oppo- site their respective names as follows : PETITIf)XKRS. William .I.ilin Thomas 859,900 Samuel .Andn-w 'l'hri'. 20,000 ♦Amount paid thereon. 8r),99o 10 (i.OOO Nothing. •J. (M)0 *How paid. In ca-sli. do. I5y tr'nsferof propert}-. do. In caiili. Vour PdtilioncrH therefore pray that your Uniiour may bo pleased by Ixjttvm I'atent under the (iruat Seal togranta Charter to your Poti- tionora, consiituling your Petitioners and such others aA may become shareholderti in the (Nxiipany tiiereby created, a body corporate and politic uncts aforesaid. FORMS. 67 And your Petitioners, as in duty bound, will ever pray. Si(jnatures of Witnesses. Sifjnatvres of Petitioners. A. F. LoBB, as to W. J. Thomas. A. F. LoBB, as to Thos. Taylor. A. F. LoBB, as to Thos, B. Tayloe. John G. Gibson, as to S. A. Thomson. John G. Gibson, as to H. V. Taylor. John G. GnssoN, as to G. P. Sharpe, By his Attorney, Herbert Mason. Dated at Toronto, this 15th day of February, 1887. ilf incorporation is sought under any other Act as well, its title should be interlined here as, for instance, "The Timber Slide Companies' Act," or "The Street Railway Act," or "The Act respectin-^ Companies for Steam and Heating, or for supplying Electricity for Light, Heat or Tower, etc." 2lf the capital of the proposed Company is S3,000 or under, notice may be dispensed with. If this is desired, Paragraph No. 2 should be struck out, and the following words should be added to the prayer of the Petition on Page G7, after the words "objects SLforesa.\d"— and your petUioners further pra;/ that inasmuch as the capital stock rf the said Company is to be dollars. Your Honour may also he pleased to dispense with the notice mentioned in Section of the said Act. 3The Directors, who must be at least three in number, must be petitioners and shareholders. Each Director must hold his stock absolutely in his own right. FORM No. 8. POWER OF ATTORNEY TO SIGN PETITION AND STOCK B00K.1 Know all men by these Presents that I, the undersigned, of the City of Edinburgh, in that part of the United Kingdom of Great Britain and Ireland called Scotland, do hereby make, constitute and appoint Herbert Mason, of the City of Hamilton, in the Province of Ontario, Escjuire, my true and lawful Attorney, for me and in my name and stead to sign the Petition of " The Hamilton Stove Company," pray- ing for incorporation under the Ontario Joint Stock Companies' Letters Patent Act, and also in my name aiid as my act and deed to sign the Stock Book of the said Company for four hundred shares of the capital *In these columns, specify the amount, if any. paid by each Petitioner upon his stock, and show whether it was paid in cash, by transfer of property, or how otherwise, in" If nothin/j has been paid, state the fact. iThe power of Attorney should in every case be given for a specific purpose, as shewn above, and not in general terms, or for general purposes. 68 JOINT STOCK companies' MANUAL. stock thereof at fifty dollars per share, and generallj* to do all lawful actsreiiuisite and necessary for etlecting the premises, hereby agreeing to ratify and confirm all that my saidAttorney shall do therein. In witness whereof I have hereunto set my hand and seal at Edin- burgh, this second day of January, A.D. 1887. Signed and sealed in the / George Peter Suarpe. presence of I ,^,„^ George Inolis. ) ) Seal. > FORM No. 9. AFFIDAVIT VERIFYING P(J\VER OF ATTORNEY. „ ,, ( In the matter of the Power of Attorney City of EtUMiiKGn, \ . , ^ r> x ou 1 1\, ni _ .' given by George Peter Sharpe, of the City ^ ° ' /of Edinburgh, to Herbert Mason, of the City of Toronto, in the Province of Ontario. I, George Inglis, of the City of Edinburgh, Student-at-law, make oath and say ; — 1. That I was personally present and did see George Peter Sharpe sign the said Power of Attorney hereunto annexed. 2. That I know the said party. 3. That the signature George Peter Sharpe i.-* of the proper hand- writing of the said party. 4. That the signature *' George Inglis," attesting the signature afore- said, in the true signature of me, this deponent. Sworn before mo at the City of ^ Edinburgh, this second day nf .laini- / CiEukge Inui.is. ary, 1««7. ' Peter Uowk, yotary I'uhlir. FORM NaniuH' Lotturn Pa- County of W ontworth, . ... ,.,..,1- I 1 Tl 1 .1 f tent Act, of >> illiam .John 1 liomas and others T„ \\'[\, I for incorporation an Tlic ll'iniiltMU St<>vo I Company. !, .\rthur Kn-i-maii l.obb, of the ('Hy of Hamilton, in tlio County of Wentworth, 8tur.c IhO Sherborne si One Edinburgh iFour hundred.. John G. Oibson 17 Feb. S A. Thomson.' L.S. Jolin (; IJibson 17 Feb. IL V. Taylor... L S. John U. Uibton 17 Fob. 0. V. Shar|M)... (by his Attor- ' ncy 11. Mason) L.S. ?.^9.i)00 00 (XJ.OOO 00 59,900 ( 100 00 100 CO 20,000 00 FORM No. 12. AFFIDAVIT VERIFYINc; SIGNATURES TO STUCK- BUUK. Pkcjvi.nce (jK Ontakio j County of Wentworth, To Wit. ):: In the matter of the application under the Ontario.Joint StockCompanies' Letteral'atent Act of William John Thomas and others, for incorporation undur the corporate name of The Hamilton Stove Company." 1, Arthur Freeman Lobb, of the City of Hamilton, in the County of Wentworth, Student-at-Law, make oath and say : 1. That I was personally present and did see William John Thomas, Thomas Taylor, and Thomas Bright Taylor, therein named, aiya the Stock-Book of tho said proposed U^miiany, marked as e.xhibit A. 2. That I know the said parties. \i. That the sij^'natures " W. J. ThomaH," " Thos. Taylor," and ♦' Thos. H. Taylor," are of the proper handwriting of the said parties. 4. That the signatures " A. F. Lobb,'' attesting tho signatures here- inbefore mentioned, are tho true signatures of mo, this Deponent. A. F. Lor.i?. .Sworn before mo at the City of liaiiiilton, in the C(junty of Wentwural)le the Provincial Secretary." W. .1. THOMAS. THnS. TAYLOP, . — ■ — J'rui'hnt. Secretary. j ^^^^ \ TluH bylaw may be adapted fur use in case of the removal of the chief jilace of bu^iine-s of the company- FORM No. 15. AFFIIJAX IT VKKIKYINC HV-LAW F( Ml INCREASE OF CAPITAL STOCK ; i'K()\'IN(; DTK SANCTION OK SAMK AND IM MLIC.VTION TliKKKoK IN ONTARIO (JA/KTTE. I'KoviN. K OK O.NTAhio, ^ ,,^ th.-matt,T..f th.. iucn.Jise of the capi- (Jounty of Weiitworth, , tal «tock of " 'Dm- Ilainllton Stovo Com- To Wit. \ pany." I, Thomas Taylor, «)f thi- said (Jity of Hamilton, EH<|uir(', niak(< oath and nay : 1, That I am th«j Socrutnry of tin- said " Thf Hamilton Stovit C'om- pany," 2. 'I'hal tin- anntnedpapor writing marke (passed by the Directors, IJrd April, l^*^"), for the incroase of the capital stock of the Company, from tliu sum of two luindrod tluiiisantl (l(»llarH to the sum of two Imndred and lifty thousand dollars, by the issuo of one thoutand shares of now stock of lifty dollars each, will bo hold at the Company's oftico, in tho City of Hamilton, on Wodnosday, tlu> 11th •lay of May next, at tho hour of 10 o'clock in tho forenoon. By (}riUr, THOS. TAVLoR, Serrrtarij. This form may bo used for notice in Ontario (ia/ctto if necessary. FORMS. . 75 FORM No. 19. AFFIDAVIT PROVING DUE CALLING OF A GENERAL MEET- ING AND VERIFYING NOTICE IN LOCAL NEWSPAPER. Province of Ontario, "j County of Wentworth, I I" ^^^ matter of a general meeting of To Wit. j " The Hamilton Stove Company." I, Thomas Taylor, of the City of Hamilton, in the County of Went- worth, Esquire, make oath and say : — 1. That I am the Secretary of the said " The Hamilton Stove Com- pany." 2. That a general meeting of the Shareholders of the said Company was held at the said City of Hamilton on the 11th May, A.D. 1887. ' 3. That the said meeting was duly called pursuant to the By-law ^ of the Company, by giving notice thereof on the 1st May, 1887, in The Evening Times, a newspaper published at the said City of Hamilton and by mailing the same, as a registered letter, duly addressed to each shareholder, at least ten days previous to such meeting. 4. That the clipping from the said The Even'nyj Times, attached to this my affidavit, and now shown to me marked " A," is a true and correct copy of the said notice given as aforesaid. 5. That said meeting was called for considering By-law No. 20 of the said Company, increasing the capital stock of the Company from the sum of two hundred thousand dollars to the sum of two hundred and fifty thousand dollars by the issue of one thousand shares of new stock of fifty dollars each. Sworn before me at the City of ) Hamilton, in the County of Went- ^ THOS. TAYLOR, worth this 11th day May, A.D. 1887. \ John Roe, A Commissioner. FORM No. 20. AFFIDAVIT PROVING DUE CALLING OF GENERAL MEET- ING WHERE NO BY-LAW FOR THE PURPOSE HAS BEEN PASSED,- AND VERIFYING NOTICE IN LOCAL NEWSPAPER AND ONTARIO GAZETTE. Province of Ontario, "j In the matter of the calling of a general County of Wentworth, V meeting of "The Hamilton Stove Com- ToWit. j pany." 1 Provisions of the Statute, or of the Letters Patent, or of a By-law of the Company made for the purpose (is the case maii be. -If the meeting was called untler special provisions in the Charter, the afti - davit must be drawn to suit the circumstances. 7G JOINT STOCK companies' MANUAL. I, Thomas Taylor, of the City of Hamilton, in the County of Went- worth, Secretary of the above named Company, make oath and say : — 1. That a notice calling a general meeting of " The Hamilton Stove Company," for the 11th day of May, 1887, at the Company's olhce, in the City of Hamilton, for the purpose of considering and sanctioning By-law No. 'J'J (made by the Directors 3rd April, 1887), increasing the capital stock of the Company from the sum of two hundred thou- sand dollars to the sum of two hundred and tifty thousand dollars by the issue of one thousand shares of new stock of fifty dollars each, was inserted in The Eroiintj Times, a newspaper published at the chief place of business of the Company, on the lat day of I\Iay, 1887. 2. That at least ten days previous notice of the said meeting was given in the said The Eeenitij Timen. 3. That the newspaper cutting hereto annexed and marked " A,' to this my atlidavit is a true copy of the said notice. 4. That at least ten days' notice was also given by publishing the same in the Ontario Gazette (or ((.s the ame uiaxj he, by mailing the same as a registered letter duly addressed to each shareholder of the aaid Company.)' 5 That the clipping from the said the Oidariu Ga:.etle, attached to this my afhdavit, and now shewn to me marked "A," is a true and correct copy of the said notice given as aforesaid. Sworn before me at the city of Ham- j ilton, in the County of Wentworth, V this 11th day of May, A.D. 1887. ) THUS. TAYLOR. Joiix Hoe, A Cvniinissioner, eli FORM No. 21. l»ETITION KOK sri'l'LK.MKN'rAKV LKTIKKS l'.\ I KN T INCIIKASINC CAI'lT.Mi STOCK. To the Honourable Sir .\lyxan JUHN KUE. worth, this sixth day of June, 1887. ) R. W. Everett, , A Cotnminiioner, etc. FORM No. 23. MjTICE in nNTJrilO GAZETTE, OF Al'PLICATlON FOR SI PPLEMENTARV LETTERS PATENT. NoTiuE is hereby j^iven that, within six mor.tlis from llio eleventh day of May, A.D. 1887, the date of the sanction thereof by the Share- holders of the Company, application under " Tlie Ontario Joint Stock Companies Letters Patent Act," will bo made by tlie Directors of " The Hamilton Stove Company," to the Lioutenant-( Jovernor of the Pro. vince of Ontario in (Jouncil, for the grant of Supplementary Letteis Patent, to conlirm a Bylaw for increasing tlie capital stock of the said "The Hamilton Stove Company," from two hundred thousand dollars to two hundred and tifty thousand dollars, by the issue of one thousand •hares of new stcjck of tifty dollurH each. JOHN ROE, Sulicitur fur J;>j W. J. THOMAS. worth, this Cth day of June, A.D. 1887. ) John Roe, A Commissioner, etc. 80 JOINT STOCK companies' MANUAL. FORM No. 26. BY-LAW INCREASING (OR DECREASING) THE NUMBER OF DIRECTORS. By-law Number 30. Whereas the number of the Directors of ' ' The Hamilton Stove Company " is three (ut- as the case may be), and it is expedient that the number should be increased ; Now tlierefore, the Directors of the said "The Hamilton Stove Com- pany " enact as follows : That the number of Directors of the said Company be and the same is hereby increased (or, decreased) to five. Dated at Hamilton, this seventh day of June, A.D. 1887. Thos. Taylor, W. .J. THOMAS, Secretary. , -»-'— . J'resldent. j Seal. FORM No. 27. NOTICE I'LBLISUINC BY-LAW IN oXTMilU tlA/.ElTE, CHANGING NUMLKIt < >F DIRECTORS. Under the provisions of R.S.O. 1887, Chap. 157, Sec. 35, the Direc- tors of the Hamilton Stove Ct^npany, hereby give piiblic notice that ^hoy have passed the following By-law : Whereas the number of Directors of the Hamilton Stove Company, is three (or, an the rase may he) and it is o.vpodit'nt that the number shonlcl bo increased. Now, tliereforo, the Directors of the said The Hamilton Stove Com- pany enact as follows : That the number of Dircctijrs of the said Coinimuy lie and tlu- same is hereby increased to Jivo. W. .1. THOMAS, TllOMAH TaVLOH, , ^ J'rr.HiiliHt. Srnrtary. \ f^^^, I I — I Dated at Hainiltnn, this seventh dny of .Fniic, A.l). 1M87. FORMS. FORM No. 28. 81 NOTICE OF APPLICATION FOR CHANGE OF COflPORATE NAME. Notice. Public notice is hereby given that(l) "The Hamilton Stove Company,'^ a Company incorporated under the Ontario Joint Stock Companies' Letters Patent Act, will, after four weeks from the first publication hereof, in the Onkirlo Liazdte, and in The Evening limes, a newspaper published in the locality in which the operations of the said Company are carried on, apply under the Act respecting the Changing of the names of Incorporated Companies, to His Honour the Lieutenant- Governor of Ontario in Council, for an Order changing its corporate name to that of "The Toronto Stove Company," 2. That the said Company is in a solvent condition. 3. That the change desired is not for any improper purpose, it being the intention of the said Company to remove its works to the said City of Toronto. 4. That the name desired is not the name of any other Company, incorporated or unincorporated, or liable to be unfairly confounded therewith, or otherwise on public grounds objectionable. JOHN ROE, Solicitor for the Company. First inserted in Gazette, 2nd day of July, 1888. A similar form may be used for notice in local newspaper. FORM No. 29. AFFIDAVIT PROVING PUBLICATION OF NOTICE OF APPLICATION FOR CHANGE OF NAME. Province of Ontario, County of Wentworth, To Wit : In the matter of the application under "The Act respecting the Changing of the names of incorporated Companies," of " The Hamilton Stove Company," a Company carry- ing on business at the City of Hamilton, for an Order in Council changing its name. I, Richard Doe, of the City of Hamilton, in the County of Went- worth, Student at Law, make oath and say : 1. That four weeks previous notice of the intention of "The Hamil- ton Stove Company" to apply for an Order of His Honour the Lieut- 82 JOINT STOCK companies' MANUAL. enant-Governorin Council, changin;^ its corporate name tothat of '• The Toronto Stove Company," was inserted in the Ontario Ga::ettt, on the following dates, viz : July 2nd, 0th, IGth and 23rd, A.D. 1887, and that the cutting from the said Ontario Ga-:ette hereto annexed and marked aa exhibit " A " to this my affidavit is a true copy of the said notice. Sworn before me at the City of Ham- \ ilton, in the County of Wentworth, [ RICHARD DOE. this 25th day of July, A.D. 1887. ' John Roe, -4 Commissioner, etc. A similar affidavit is rcjuired verifying the notice in the local news- paper, with this addition : 2. That the 8aiotiti(jtierH are in a solvent condition, aw i« nliown l)y the statement in (ieneral Italance-Sheot of the Company, hereto an- nexed. 4. That the chan((0 desired by your ]iutit.ion«Tn is not for any im- proper purpoHo, and is ncjt otlicTwise objcclionabie, tlio oltjccl of your petitionurn b«;in^ to ri-move the wfjrksof tlio Haid Company to (lio Hai. That the name denired in not the name of any other known Com- pany, inc*rated or unincorporated, or liable to be unfairly con- founded therewith. FORMS. 83 Your petitioners therefore pray that your Honour will be pleased by Order in Council to change their corporate name from that of " The Hamilton Stove (Company," to that of " The Toronto Stove Company." And your Petitioners, as in duty bound, will ever pray. W. J. THOMAS, Thomas Taylor, President. Secretary. ^-^^^ I Seal. I Dated at Hamilton, 25th July, A.D. 1887. FORM No. 31. AFFIDAVIT VERIFYING PETITION FOR CHANGE OF NAME. Province of Ontario, j ^^ t^® matter of the petition of " The Hamilton Stove Company," for an Order of County of Wentvvorth, Igj^ Honour the Lieutenant-Governor in To Wit Council, changing its corporate name to that J of " The Toronto Stove Company. " I, William John Thomas, of the City of Hamilton, in the County of Wentworth, President of the Company, make oath and say ; 1. That the allegations in the within petition contained are to the beat of my knowledge and belief true in substance and in fact. Sworn before me at the City of Ham- ^ ilton, in the County of Wentworth, W. J. THOMAS, this 25th day of July, A.D. 1887. ) John Roe, A Commissioner, etc. FORM No. 32. AFFIDAVIT VERIFYING SIGNAlURES TO PETITION. Province of Ontario, County of Wentworth, To Wit. In the matter of the application under the Act, " The Act respecting the changing of the names of Incorporated Companies " of " The Hamilton Stove Company," a Company carry- ing on business at the City of Toronto, for an Order in Council changing its name. 84- JOINT STOCK companies' MANUAL. I, Arthur Freeman Lobb, of the City of Hamilton, in the County of Wentwurth, Student at Law, make oath and say : 1. That I was personally present, and did see William John Thomas and Thomas Taylor, President and Secretary respectively, of the said Comi)any, sign the said Petition, marked as exhibit "A" ; that I know the said parties, and that the signatures " W. J. Thomas " and " Thos. Taylor " are of the proper handwriting; of the said parties. Sworn before me at the City of i Hamilton, in the County of I \ p L(JBB Wentworth, this 25th day of | July, A.D. 1887. J J. R )K, .1 Cnmmissioiter, etc. FORM No. 33. EV^IDENCE OF THF COMPANY'S SOLVENCY. Thn should consist of a Balance Sheet or of a Statement specially prepared for the purpose, setting out the Company's affairs in detail, sufficient to satisfy the Lieutenant-Governor in Council. As the Act under which the change of name is to be granted, makes proof of the solvency of the applicants, a .si/.e right Taylor, bo the first Directors of the said Company. And we further direct that no parcel of lands or interest therein at any time ac<|uired by the said Company, and not required for its actual use and f^ccupation, or not held by way of security, or not situate with- in the limits or within oiioniilo of the limits of aiiy city or town in the said Province, shall be hold by the said Company or by any trustee on their behalf for a longer period than seven years after the acfpiiaition thereof, but shall bo absolutely sold and disposed of, ao that the Com- pany shall no longer retain any interest therein unless by way of security. .\nd vwj further direct that any such parcel of land or any inftTost therein, not within the exceptions horoinboforo mentioned which shall bo hold by the said Company for a longer period than seven yoar«, witliout being disposed of, shall bo forfeited to Hor Miijosfy for the usoH of llio said Pr<>viii(<'. And we further direct that no such forfeiture shall take oU'ect or bo onforced until tho expiration of at least nix calender months after notice in writing to tho said (.'ompany of tho intention of the rjoveni- munt to claim such forfoiture, and it shall be tho duly of tho Company U> give U) tho Lietitonant-Oovornor, when re(|tiired, a full and correct FORMS. 87 statement of all lands at the date of such statement held by the Com- pany, or in trust for the Company, and subject to this Proviso. And we further direct that the Company shall be subject to the provisions of said Act, being Chapter 1 57 of the Revised Statutes of Ontario, 1837, intituled "An Act respecting the incorporation of Joint Stock Companies by Letters Patent," and to such further and other provisions as the Legislature of Ontario may hereafter deem expedi- ent in order to secure the^due management of its affairs and the pro- tection of its shareholders and creditors. The Charter of the Company shall be forfeited by non user during three consecutive years, at any one time, or if the Company does not go into actual operation within three years after it is granted ; and no declaration of such forfeiture by any Act of the Legislature shall be deemed an infringment of such Charter. The Charter of the Company may at any time be declared to be forfeited and may be revoked and made void by Order of our Executive Council for our Province of Ontario, on sufficient cause being shown to us in that behalf, and such forfeiture, revocation and making void may be upon such conditions and subject to such provisions as to us may seem proper. Ix Testimony whereof, We have caused these Oar Letters to be made Patent, and the Great Seal of Our said Province of Ontario to be here- unto affixed : WITNESS, the Honourable SIR ALEXANDER CAMPBELL, Knight Commander of Our Most Distinguished Order of St. Michael and St. George, Member of Our Privy Council for Canada, &c. , &c., Lieutenant-Governor of Our Province of Ontario, at Our Govern- ment House, in Our City of Toronto, in Our said Province, this twenty- first day of February, in the year of our Lord one thousand eight hundred and eighty-seven, and in the fiftieth year of Our Reign. By Command, ARTHUR S. HARDY, Secretary. FORM No. 35. LIST OF SHAREHOLDERS. List, in duplicate, of all persons who, on the 31st December, 188 — , were shareholders in the as required by Sec. 57, Cap. 157, R. S. O. 88 JOINT STOCK COMPANIES MANUAL. Names of Shareholders alphabetically arranged. Address. Callin«;. Amount of Stock held. S cts Amount unpaid on Stuck. S cts. FORM No. 36. AFFIDAVIT VERIFYING THE ABOV^E LIST, AND THE ATTACHED SUMMARY OF THE AFFAIRS OF THE COMPANY. Pkovlnce of Ontario,, In the matter of the .\nnual returns of the^ I We- , and ■ County of ^f, , President and Secretary of the above named Company, respectively, To Wit : J maku oath and say : — 1. That the above list of the Shareholders, and the Summary of the allairs of the said Company hereto attached, are, to the best of our knowledge, information and belief, true and correct in every par- ticular. Sworn Before me at J in the of this day of \ , a .1. I', in anil fur the t'ounty of {For Siijuatiue vf Oeponeut.) FORM No. 39. I'KnXY. 1 1 A M I I.T< ) .N StO V K C< I M 1 a N \ . I (ivnT^i! Peter Shnrpo, of the City of K(liiil>uii.,'li, in that jiart of the United Kitig) If th)? I'li'^idont or Hocrotary (Iocn not make or join in the attxlAvit, iit«te the rvtuum thereof here. FORMS. 89 holder of 400 shares in the stock of the company, hereby appoint and authorize Herbert Mason, of Hamilton, Esquire, to vote for me and on my behalf at the ordinary (or extraordinary, as the case may he) general meeting of this Company, to be held on day of , and at any adjournment thereof (or at any meeting of the Company that may be held within the present year.) Witness my hand and seal this day of 188 . Signed in the presence of J. Jones, [Seal.] G. P. Shakpe. FORM No. 40. POWER OF ATTORNEY TO MAKE TRANSFERS, RECEIVE DIVIDENDS, ETC. Know all men by these presents, that I , do make constitute and appoint of my true and lawful attorney for me and in my name and on my be- half, to sell, assign and transfer the within shares in the capital of the Hamilton Stove Company, to me belonging, to receive the consideration money, and to give a receipt or receipts for the same, to receive and give receipts for all dividends that are now due, and that shall hereafter become due and payable on the same, for the time being, and generally to do all lawful acts requisite for eflfecting the premises, hereby ratifying and confirming all that my said attorney shall do therein. In witness whereof, I have hereunto set my hand and seal at thia day of , in the year of Oiir Lord, one thousand eight hundred and Signed and sealed in the presence of The following are given as examples of by-laws in general, which Companies can alter to suit their respective circumstances and require- ments, but every by-law must have the preamble and enacting clause as given herewith : — Whereas the Directors of The Hamilton Stove Company deem it ex- pedient that certain By-laws for regulating the atlairs of the Company should be made. Now therefore be it enacted, and it is hereby enacted. MKETINCS. 1. That the annual meeting of the shareholders shall be held at the office of the Company on the first Monday in January in each year, to receive the report of the Directors for the past year, to elect Directors for the ensuing year, and for all other general purposes relating to the management of the Company's atlairs. 2. That a general meeting of the shareholders may be called at any time by the Directors whenever they may deem the same necessary or advisable for any purpose not contrary to law, or the Letters Patent of the Company or the Statute, and it is incumbent on the President to call a special meeting of the shareholders whenever required so to do in writing by one-fourth part in value of the sliareholdors of the Company, for the transaction of any business specified in such written refjuisition and notice calling tiio niuutiiig. 3. That notice of the time and place for holding the annual or a gen- eral meeting of the Company must be given at least ten days previ- ously thi reto in the Ei;ninIollarH. BY-LAWS. 91 6. That questions at meetings shall be decided by a majority in value of the shareholders present, either in person or by proxy, and in case the number of votes is equal the President or Chairman shall have a deciding or casting vote. DIRECTORS 7. That the affairs of the Company shall be managed by a board of five Directors, of whom three shall form a quorum. 8. That the President and Vice-President shall be chosen by the Directors from amongst themselves at the first board meeting after the annual meeting. 9. That the President shall, if present, preside at all meetings of the Company. He shall call meetings of the Board of Directors and Share- holders when necessary, and shall advise with and render such assist- ance to the Manager as may be in his power. In his absence the Vice- President shall have and exercise all the rights and powers of the Pre- sident. A Director may at any time summon a meeting of Directors. 10. That questions arising at any meeting of Directors shall be de- cided by a majority of votes. In case of an equality of votes, the Chair- man, in addition to his original vote, shall have a casting vote. 11. That the Secretary shall keep a record of the proceedings at all meetings of the Board and of the Shareholders of the Company, and shall be the custodian of the seal of the Company, and of all books, papers, records, etc., belonging to the Company, which he shall deliver when authorized so to do by a resolution of the Board, to such person, or persons, as may be named in the resolution. 12. That any Shareholder, not in arrears for payments for calls upon his stock, may be elected a Director. 1 3. That the Directors shall hold office for one year and until their successors shall be elected. 14. That in case of the death of a Director, or his being unable to act as such, or his ceasing to be a Shareholder, the vacancy thereby created may be filled for the unexpired portion of the term by the Board from among the qualitied Shareholders of the Company. 15. That the Company shall have a corporate seal of such design as the Board may determine, which seal shall whenever used be authen- ticated by the signatures of the President and Secretary. 16. That the Board shall from time to time fix the salary or wages to be paid officers of the Company. 17. That calls upon subscribed stock shall be made from time to time as the Board may determine — no call shall exceed twenty-tive per cent, of the subscribed stock, and there shall be an interval of at least thirty days between calls. 92 JOINT STOCK companies' MANUAL. 18. That it shall not be compulsory on the Board to receive full payment of any share or shares until the same shall have been de- manded by call. 111. That the Board shall have power to summarily forfeit shares and the money paid thereon, upon which any call shall have remained unpaid for six months after it shall be due and payable, and such for- feit stock shall thereupon become the property of the company. 20. That receipts for payments of calls shall be issued from time to time as such payments are made, but stock certificates shall only be issued when shares are fully paid up, and both receipt and certificate shall be authenticated by the signature of the President and Secretary, and sealed with the Company's seal. L'l. That shareholders may, with the consent of the Board, but not otherwise, transfer their shares, and such transfers shall be recorded in a book provided for the purpose, and signed by him and his transferee and duly witnessed, but no person shall be allowed to hold or own stock in the Company without the consent of the Board. ^ ACCOUNT.S. 22. That the Directors shall cause true accounts to be kept, — < )f the stock in trade of the Company. Of the sums of money received and expended by the Company, and the matter in respect of which such receipt and expenditxire takes place ; and Of the credits and liabilities of the Company. 23. That the books of accounts shall bo kept at the head office of the Company, and shall be open to the inspection of the members during the hours of business. - 24. That once at least in every year the Directors shall lay before the Company in f,'t!nunil nieotiuK a stati'inont i>f tl»o income and expendi- ture for tlie past year. A balance shoot shall bo made out in every year, or oftener if desirable, and laid before the Company in general nieetinL;,and such balance shoot shall contain a summary of the proper- ty ami liabilities of the (Jomjiany arranged under the nocossary head- ingfi. HANK Ai ( OINT. '2i>. That ii bunk iiccoimt hIiuII I)o kept in the name of the Company at a bank t<< l>o ncloctod by th<- hi>ur(l, and all choijucs Hhall bo signed by th« Sccrotary ami Troanuror. iThU mil* tuny Im< (lcNirnl)l<< iitidor cortain circuiimtancoH, but on a general thiiiK tlio ciwni-r of fully paiil iiji KhnrcN cnii trunMfcr tlxnii at will. Tlii' cotiHcnt of the Ilonnl iiitixt Iw linn tranHfi-rriiiK HliaroN that arc not fully |>ni(l u|>, and th« ii'-w lioliliT kIiouKI lie n» r<-H|ionHil)lc n iM-rmin oh tlio old. • K»Htrictionii tm to tin- time nixl tiiniui<*r of inN|K>clinK' tlin hooka may Ix- im- \ni>ift\ by the ('oiii|»atiy in (C'x'ra] mf{, or it niuy, in (•••rtnin ciihoh, he well to pitrikr thin byUw out altoKcther. BY LA.WS. 93 SOLICITOR. 26. That Charles Brown, of Hamilton, Esq., shall be the solicitor of the Company, but he may at any time be removed by a resolution of the Company, passed in general meeting. AUDITORS. 27. That one or more Auditors shall be appointed annually by the Shareholders at the annual general meeting, whose duty it shall be to examine all books, vouchers and accounts of the Company and all doc- uments having reference to the business thereof, and to prepare a bal- ance sheet and abstract of the aifairs of the Company and submit the same to the Board as soon after the close of the financial year as pos- sible, together with such suggestions or recommendations as they may think fit. CHANGING BY-LAWS. 28. That the Board may from time to time repeal, amend and re-en- act these by-laws, but such change, unless in the meantime confirmed at a general meeting duly called for the purpose, shall only have force until the next annual meeting of the Company, and if not confirmed thereat, shall from that time only cease to have any force. CHAPTER 178. All Act respecting tlie Changing of the Names of Incorporated Companies. HER MAJESTY, l»y and with the advice and consent of the Legislative Assembly of ^^e Province of Ontario enacts as follows : — 1. Where an incorporated company within the legisla- tive authority of the Legislature of this Province, whether incorporated under a special or general Act, is desirous of changing its name, the Lieutenant-Governor, ujion being satisfied that the company is in a solvent condition, that the change desired is not for any impropei- purpose, and is not otherwise ol>jectionable, and that the notice hereinafter pro- vided for has been dul}' given, may, by Order in Council, change the name of tlic company to some other name set forth in the said order. 2. When the aj)plicants are a trading corporation or a company carrying on business for profit, the company shall give at least four weeks' ])rrvious iiotifc in the fhtiario Oazf'ttc and in some newspapi-r published in the locality in which the operations of the company are cairietl on, of the intt-ntion to apply for the change of name, aiel sluill state the name ]iroposeany to some other unobjectionable naiii'- without if(|iiiiing any further notice to be given. 4. Where tin- name of some lorality in the i'ro\ince of Ontario constitutes part of the name of any company incor- ])()rnii'A by letters pab-nt \»-i'<)r*', the .SOth day of .March, 1885, Huch company may aj»ply to tin; Lieut(!nant-( ioV(;rnor in CHANGING NAMES OF COMPANIES. 95 Council to amend their name by striking out the name of such locality, and such amendment may be made without the publication of any notice in all cases where the name of such locality does not form an essential part of the name of the company. 5. The change of name shall be conclusively established by the insertion in the Ontario Gazette of a notice thereof by the Provincial Secretary. 6. No contract or engagement entered into by or with the company, and no liability incurred by it shall be affected by the change of name ; and all actions commenced by or against the company prior to the change of name may be proceeded with against or by the company under its former name. 7. This Act shall extend to any company incorporated under The Ontario Joint Stock Companies' Letters Patent Act, if such company has made or makes an application hereunder, and shall also extend to every corporation ag- gregate within the legislative authority of the Legislature of this Province, except a municipal corporation or other cor- poration of a like nature. CHAPTER 183. An Act respecting the winding up of Joint Stock Companies. Shokt TULE, 8. 1. Api'LIcation of Act, s. 2. Intkhi-kktation, 8. 3. When t'oMPANY may be wolxd DP, 88. 40. ReGISTKATION of WlXDlNG UP Order or Resolution, s. 7. con-seyuexces ok commenc'inc; to WINK UP, 8. 8. Liquidators, bs. 9-13, 19. LlAHILITV OF fONTRIBUTORIE.S, 88. 14-lH. Expenses, 88. 20, 21. .^IEETI^■^iS OFCONTKI»UTOKIES,8.22. i Applications to court, 88. 23-30. Matters of practice, ss. 31-39. DiSWOLUTION OK ('OMPAMES, 88. 40 44. Rules, a. 45. Application ok sects. 47-5G, s. 40. Resolutions for dlstribution of assets or reduction of capi- tal, 68. 47-50. Liability ofoHicers for payraenta made under resolution, s. 51. Liability of shareholders for money received, s. 52. Restriction as to insurance com- panies, 8. 53. Resolution for reduction of shares not to atlect amount remaining unpaid thereon, s. 54. Notice of reduction of shares, ss. 55, 5G. HKJt -MAJESTY, by and witli the advice and coii-sent of the Legishitive Assembly of the Province of Ontario, enact.s as follows : — I. Thi.s Act may Ijc cited a.s "The Juint Stock Com- ■panlcH Whidiiifj-up Act." *-i. Til is Act shall apply to all incorporated companies or arthociations incoijxjiated l»y the Le;,dslature of this Pro- vince, i)V under the authority of any Act of this I'rovince, and to all coinpanie.s and a.sHoeiation.s which weni incorpor- ated by the Parliament of the Province of Upper Canadji, or of the Province of < 'anada, fir nnder the authority of any Art of the Piovinee of < 'jinalic auction or private contract, according to the ordin- ary mode ill which such sales aro made, with jiowei- to trans- fer the wliole property to any peison or comj)any, or to sell the same in parcr instrument of incorporation of the company ; and the aujount which he is liable to contribute shall be deemed a88CtH of the c(Hn|.any, ;iiiy an order of the County Ojiirt Judge, whether the amount of his liabil- ity exceeds or nf>t the ordinaty jurisdiction of the. said <'ourt ; and his being plae(!d on tin- li-^t of (•oiitril'nlori<;s undci- this WINDING UP OF COMPANIES. 107 Act shall be deemed a judgment, and the liquidator shall be deemed a creditor, within the meaning of The Act respecting Arrest and Imprisonment for Debt ; and the said persons shall respectively have the same remedies, and the County- Court and Judges and the officers of justica shall in such cases have the same powers and duties (as nearly as may be), as in corresponding cases under the said Act. 19. — (1) No liquidator shall employ any counsel, or soli- citor, without the consent of the inspectors, or of the contri- butories. (2) No liquidator or inspector shall purchase, directly or indirectly, any part of the stock in trade, debts or assets of any description of the estate. (3) The liquidator shall deposit at interest in some char- tered bank to be indicated by the inspectors or by the Court, all sums of money which he may have in his hands, belong- ing to the company, whenever such sums amount to $100. (4) Such deposit shall not be made in the name of the liqui- dator generally, on pain of dismissal ; but a separate deposit account shall be kept for the company of the moneys belong- ing to the company, in the name of the- liquidator as such, and of the inspectors (if any) ; and such moneys shall be withdrawn only on the joint cheque of the liquidator and one of the inspectors, if there be any. (5) At every meeting of the contributories, the liquida- tors shall produce a bank pass-book, shewing the amount of deposits made for the company, the dates at which the de- posits were made, the amounts withdrawn and dates of such withdrawal ; of which production mention shall be made in the minutes of the meeting, and the absence of such mention shall be privia facie evidence that the pass-book was not produced at the meetings. (6) The liquidator shall also produce the pass-book when- ever so ordered by the Court at the request of the inspectors or a contributory, and on his refusal to do so, he shall be treated as being in contempt of Court. (7) Every liquidator or inspector shall be subject to the summary jurisdiction of the Court in the same manner and 108 JOINT STOCK companies' MANUAL. to the same extent as the ordinary officers of the Court are subject to its jurisdiction ; and the ])erfonnance of his duties may he compelled, and all remedies sought or demanded for enforcing any claim for a debt, privilege, mortgage, lien or right of property upon, in, or to any effects or property in the hands, possession or custody of a liquidator, may be ob- tained by an order of the Court on summary petition, and not by any action, attachment, seizure or other proceeding of any kind whatever ; and obedience by tlie licjuidator to such order may be enforced by the Court under the })enalty ol imprisonment, as for contempt of Court or disobedience thereto ; or he may 1)6 removed in the discretion of the Court. !jO. All costs, charges and expenses properly incurred in the voluntary winding-up of a comjian}^ including tlie re- muneration of the li(juidators, shall be payable out of the assets of the company in priority to all other claims. 21. In case of there being no agreement, or provision fix- in"" the remuneration of a li(juidator, he shall be entitled to a commission on the net })roceeds of the estate of the com- pany of every kind, after deducting expenses and disburse- ments, such commission to be of live per cent, on the amount realized, not exceeding .i?l,00(), the further sum of two and a half per cent, on the amount realizey th«; company, (jerurs by death, lesignation oi' otlier- wi.se, a general meeting for tlic purpose of filling up the va- cancy may be convened by tlie continuing liipiidators, if any, or if none, tlien by any contributory of the company. {'!) The li(|uidatorH njay iVom tiuio to time, during tlio continuance of the winding up, sunnnon general meetings of tlie company for the purpo.se of obtaining the sanction of the company by special le.solution, or extraonlinary resolution, or for any other purjioses they think fit. WINDING UP OF COMPANIES. 109 (3) In the event of the winding up continuing for more than one year, the liquidators shall summon a general meet- ing of the company at the end of the first year, and of each succeeding year from the commencement of the winding up, or as soon thereafter as may be convenient ; and shall lay before the meeting an account, shewing their acts and deal- ings, and the manner in which the winding up has been con- ducted during the preceding year. (4) The liquidator shall also call meetings of the contri- butories whenever required in writing so to do, by the in- spector or five contributories, or by the Court, and he shall state succinctly in the notice calling any meeting the pur- pose thereof. (5) The contributories may, from time to time, at any meeting, determine where subsequent meetings shall be held . and in the absence of such a resolution all meetings of the contributories shall be held at the oflfice of the liquidator or of the company, unless otherwise ordered by the Court. (6) Notice of any meeting shall for the purposes of this Act be deemed to be duly given, and the meeting to be duly held, whenever the notice i? criven and meetingfheld in man- ner prescribed by the Act, charter or instrument of incor- poration or by the regulations of the company, or by the Court ; or (7) Notice of the meeting may be given by publication thereof for at least two weeks in the Ontario Gazette, or by such other or additional notices as the Court, or the inspector or the company may direct, and by also, except where the Court otherwise directs, addressing notices of the meeting to the contributories within the Province, and to the repre- sentatives, within the Province, of contributories who reside out of the Province ; and the notices shall be posted at least ten days before the day on which the meeting is to take place, the postage being prepaid by the liquidator. (8) No contributory shall vote at any meeting unless pre- sent personally, or represented by some person having a written authority (to be filed with the li([uidator) to act on his behalf at the meeting, or generally ; and when a poll is 110 JOINT STOCK companies' MANUAL. taken reference shall be had to the number of votes to whioh each member is entitled by the Act, charter or instrument of incorporation or the regulations of the company. *23. — ;1) The liquidators or any contributory of the com- pany may apply to the Court to determine any question arising in the matter of the winding up ; or to exercise all or any of the powers following; and the Court, if satisfied that the determination of the question, or the required exercise of power, will be just and beneficial, may accede wholly or partially to the application, on such terms and subject to such conditions as the Court thinks tit ; or it may make such other order on the application as the Court thinks just. (2) The ( 'ourt, at any time after the presenUition of a petition for winding up a company and before making an order for winding up the company, may restrain further pro- ceedings in any action or proceeding against the company (other than uny him, sucli jjroduction shall be without prejiidii-i; to the lien ; and tluj (Jourt shall have juri.sdiction in the winding up to deteiiniiif ;ill (|ues- tions relating to such lien. (17) Where in the course of winding up a coinpany under this Act, it appears that any past or present director, man- WINDING UP OF COMPANIES. 113 ager, official or other liquidator, or any officer of the com- pany has misapplied, or retained in his own hands, or be- come liable or accountable for moneys of the company, or been guilty of any misfeasance or breach of trust in relation to the company, the Court may, on the application of a liquidator, or of any contributory of the company, notwith- standing that the offence is one for which the offender is criminally responsible, examine into the conduct of such dir- ector, manager, or other officer, and compel him to repay the moneys so misapplied or retained, or for which he has be- come liable or accountable, together with interest after such rate as the Court thinks just, or to contribute such sums of money to the assets of the company by way of compensation in respect of such misapplication, retainer, misfeasance, or breach of trust, as the Court thinks just. 24. If at any time a contributory desires to cause any proceeding to be taken which, in his opinion, would be for the benefit of the company, and the liquidator, under the authority of the contributories or of the inspectors, refuses or neglects to take such proceeding, after being duly re- quired so to do, the contributory shall have the right to ob- tain an order of the Court authorizing him to take such pro- ceeding in the name of the liquidator or company, but at his own expense and risk, upon such terms and conditions as to indemnity to the liquidator, as the CouA may prescribe • and thereupon any benefit derived from such proceeding shall belong exclusively to the contributory instituting the same, for his benefit and that of any other contributory who may have joined him in causing the institution of such pro- ceeding ; but if, before such order is granted, the liquidator shall signify to the Court his readiness to institute such pro- ceeding for the benefit of the company, an order shall be made prescribing the time within which he shall do so and in that case the advantage derived from such proceeding* shall appertain to the company. 2«5. — (1) If a vacancy in the office of liquidator appoint- ed by the company occurs by death, resignation or otherwise, the company in general meeting may fill up such vacancy. 114 JOINT STOCK companies' MANUAL. (2) If from any cause there is no li(|uidator acting, either provisionally or otherwise, the Court may on the application of a contributory, appoint a liquidator or li([uidators. (3) The Court nuiy also on due cause shewn, remove a liquidator, and appoint another liquidator. (4;) When there is no licjuidator the estate shall be under the control of the Court until the appointment of a new liquidator. • 526. — {!) Any one or more contributories whose claims in the aggregate exceed S500, who may be dissatistied with the resolutions adopted or orders made by the contributories or the inspectors, or with any action of the licjuidator for the dispo.sal of the property of the company, or any part there- of, or for postponing the dispo.sal of the same, or with re- ference to any matter connected with the management or winding up of the estate, may, within four clear days after tliu meeting of the contributories in case the subject of dis- satisfaction is a resolution or order of the contributories, or within f(jur clear days after becoming aware or having notice of the resolution of the inspectors or action of the licjuidator where such resolution or action is the subject of dis.satisfac- tion, give tiitril»uturie.s jHe.sent at tlio time and j)lace so fixed, may approve, rescirie dissolved from the date of such order, and the company shall l>e dis.solved accordingly; which order shall be reported by the luiiiiflator to the Provincial Secre- ta ry 4^8. If tilt- lii|iii(lut(j|- makes default in transmitting to the Provincial SccreUiry the return mentioned in section 40, or in reporting the order fif any) declaring the company dis- solved, he shall i»e lialtlt; to a peiuilty not exceecling !?2() for every day during which Ik- is in default. 4!!. All dividends depositeil in a bank an.'iy- ment of the del>ts of the comi>any, (•2) Or may, by such resolution, direct that proceedings bo taken to rediice tlw cajiitiil ; (a) EitlnT by paying oil" the sharrs of such persons as may <;lcct to lie paid of!" at a rate lixed by the rcMolution, or to be deteiininid in accordance witli a jtlan llKnein sjx'cified ; (h) Or by paying oil' a certain fixed j)r(j|ioilion of all the Hlmrci. WINDING UP OF COMPANIES. 121 (3) This section shall liot apply to a company the capital of which is not divided into shares. 49. — (1) The company shall thereupon give notice (Form A) of the resolution in the Ontario Gazette, and in some newspaper published in the city of Toronto, and in some other newspaper published where the chief place of- business of the company in Ontario is situate, if any newspaper is published in such place. (2) The notice shall also state that after some day to be therein named, and which shall not be earlier than three months fi om the first publication of the notice in the Gazette, the company will act upon the resolution. (3) The notice shall also call upon all creditors of the com- pany to file their claims against the company forthwith, whether sach claims are or are not then due. (4) Where the company has no place of business in On- tario, or its chief place of business is in Toronto, it will be sufficient if the notice is published in the Gazette and in one Toronto newspaper. (5) The notice shall be published in the Gazette and in each of the said newspapers (where publication in more than one is required) at least six times during the said period of three months, and in computing such six times no two pub- lications which occur in the same week shall be counted. 50. Upon the arrival of the day appointed, or so soon thereafter as conveniently may be, the officers of the com- pany may act in accordance with the terms of the resolution ; provided (1) either that the company has no creditors, and a statement (Form B) upon the oath or solemn affirmation of the chief executive officer and of the treasurer of the com- pany stating their belief of this fact, is filed with the clerk of the County or District Court of the county or district where the chief office of the company is situated ; (2) or the consent of the company's creditors to the resolution being acted upon has been procured in writing, anfl a statement under oath or solemn affirmation of the said officers, con- taining the particulars set forth in form C, is filed with the cierk. H 122 JOINT STOCK companies' MANUAL. •51. No orticer of such company shall make or authorize any payment by virtue of such resolution until one or other of the said statements has been tiled as aforesaid, or without the consent of every creditor of the company, so long as to his knowledge any debt, whether the same is due or not, or any accrued liability of the company, remains unsatisfied, and any ofiicer who violates the provisions of this section shall, besides being subject to such criminal punishment as is authorized for his ofience, be liable personally for the amount of such unsatisfied claim or accrued liability to the creditor or other person entitled to claim from the company. •1^. Every shareholder receiving moneys under such reso- hition, shall, to the extent of the moneys so received, remain liable for any debts or liabilities of the company then in fact existing, and upon the winding up of the company by judicial process, ever}' such person, his executors or adminis- trators, may be requireil to contribute to that extent towards the payment of such debts oi liabilities after the other assets of the com|)any have been exhausted, but no executor or administrator shall be held so liable unless at the time he receivas notice of the assessment he has in his hands assets applicable thereto, or subse(iuently receives such assets. •5JI. No insurance or guarantee company, or other eoni- piiny carrying on business of a like nature, shall pay ofTany part of its capital stcjck under this Act until every policy, and every instrument having the efl'ect of a )>olicy, given by the company luus exj)ired, or been terminated, and, in the ca«e of such a com])any, this fact shall be stated in the state- ment ''Form B or (J) til<'d as aforesaid. at. Where tin; capital of a eoinpaiiy has Itecoiiie impaired, ami the sljareholderB pass a special resolution to reduce the par value of the shan-s of the (•omj)aiiy, th(^ shares shall theieiij)on be reduced in acconlance with the terms of the resolution, provided that the resolution shall not in any wise affect tiie amount still niiiaining payal»le upon the shares, but the same amount sliall, e.\cej)t as to a double or other additional liability, continue to l)e payable in respect of every share as if such resolutii))i liaai(l up thereon. DiKiJosal of amount paid up. applicant, the amount paid in upon the stock of each applicant, and the manner in which the same has been paid in. and is held for the com- pany : 3. The aggregate of thp stock so taken shall be at least the one half of the total amount of the propo.sed capital stock oi the company : 4. The aggregate so paid in tiiereon .shall, if the company is not a loan company, be at least ten per cent, of the stock so taken ; if the com- pany is a loan company the aggregate so paid in of the stock so taken shall be at least ten per cent, thereof, and shall not be less than one hun- dred thousand dollars : 5. Such aggregate shall be paid in to the credit of the company, or of trustees therefor, and .shall be standing at such credit in some chartered bank 01- ))aiiks in Canada, unless the object of the com- pany is one requiring that it should own real estate — in which case any portion not exceeding one half of such aggregate may be taken as paid in, if it is bona fide invested in real estate suit- able to such object, which is duly held by trustees for the company, and is of the recpiired value, over and above all incumbrances thereon : ('). The petition may ask for the emboilyiug in the letters patent of any provision which, under this Act, might Ijc made by by-law of the com- j)any ; and such provision so embodied shall not, unless prtjvision to the contrary is made in the letters patent, be sulject to rej)eal or alteration by by-law. IVeliminary 4J. l'.(;fore the letters patent are issued, tin; ap- Il'l^^'l V '"■ |>lieants shall establish, to the .satisfaction of the Secretary of State, or of such otlier ollicer as is charged by the . 2. The applicants for such su])plementary let- pli^^tion to l.e j.gj.^ |,atL.nt shall give at least one month's notice in the Cawrdd Guzelie of their intention to apply for the same, stating therein the purposes or ob- jects to which it is desired to extend the ])OwerH of tlie com])any. Pnxjftolx.- I."*. Before such siipjiltiiiii'iitaiy letters patent fumijihed U) ^p,. issut'd, the applicants shall establish to the Hfcretary of . , •,..!.. e ,.<. ^ c i 9ui«-. satisfaction of tin- .Secretary ot »State or or such other ofliff) as is charged by tlie (jovernor in Council to r('|M(it thereon, the duo pa.ssing of the resolution authorizing the ajiplication antition ; and for that purjiose the Secretary of State, or su(;h other officer, shall take and ke(rp of record any requisite evidenci! in writing, l»y oath or afliniiation, or by HoloiMti declaration. (fTIint of Hllp \i*. I pull 'liif proof so niadc, tlii- (lovciiior in plemenury ( ouncil iiiav trraiit suitpletiuMitary letters patent ini'l'T th<- (treat Seal, cxtelidmg tlie powers or APPENDIX. 131 the company to all or any of the objects defined in the resolution ; and notice thereof shall be forthwith given by the Secretary of State, in the Canada Gazette, in the form B in the schedule to this Act; and thereupon, from the date of the supplementary letters patent, the undertaking- of Notice of is.rs not affected. the allotment thereof, or the manner in which the sanio shall be made : 3. The liability of shareholders to persons who were, at the time of the reduction of the capital, creditors of the company, shall remain the same as if the capital had not been reduced. Such by-law 20. No by-law for increasing or reducing the bysbarT-™^*^ Capital stock of the Company, or for subdividing the shares, shall have any force or etiect what- soever, until it is approved by the votes of share- holders representing at least two-thirds in value of all the subscribed stock of the company, at a special general meeting of the company duly called for considering the same, and afterwards confirmed by supplementary letters patent. holders and confirmed by sapplemen- tary letters patent. Petition for HUppleinen- tary letters l>at€nt to con- firm by law. By-law, &c., to be pro- dnceose, take and keep of record any re- ((uisit^? I'videncc! in writing, by oath or nffirmation or by solemn mention<'resiaent elect trora among themselves a president and, if and officers, they see fit, a vice-president of the company ; and may also appoint all other officers thereof. 13G JOINT STOCK COMPANIES MANUAL. Failure to 511. If, at any time, an election of directors is elect directors, ^j^^ made, or docs not take effect at the proper rem i . ^j^^^^^ ^j^^ company shall not be held to be there- by dissolved ; but such election may take place at any subsequent general meeting' of the comjmny duly calletl for that purpose ; and the retiring directors shall continue in office until their suc- cessors are elected. Powers and duties of di- rectors. Stock. Dividends. Number, &c., of directort). Anvtiln and otticeni. MectinKit- renalticH. (ifn«ral IHiweni. ( 'oiifirination of l>y lawn. JI5. The directors of the company may admin- ister the atiairs of the company in all thin<,'s, and make or cause to be made for the company, any description of contract which the company may, by law, enter into; and may, from time to time, make by-laws not contrary to law, or to the let- ters patent of tlie cora])any, or to this Act, for the following purposes : — (d.) The regulating of the allotment of stock, the making of calls thereon, the payment thereof, the i.ssue and registration of certiticates of stock the forfeiture t may held by such shareholder, beyond the sums then 3>eAllowed. actually called for; and upon the moneys so paid in advance, or so much thereof as, from time to time, exceeds the amount of the calls (hen ma«le upon the shares in respect of whicli such advance is made, the com]mny may pay interest at such rate, not exceeding eight per cent. ])er annum, as the shareholder wlio Jiays such sum in advance anaid on such shares at the time of forfeiture, less any sums whicli are sid)- Me«|ticntly receivtd by ihr com]iany in respect thereof APPENDIX. 139 42. The directors may, if they see fit, instead Enforcement of declaring- forfeited any share or shares, enforce °[ caUa^b"* payment of all calls, and interest thereon, by ac- action. tion in any court of competent jurisdiction; and in such action it shall not be necesaary to set forth the special matter, but it shall be sufficient to declare that the defendant is a holder of one what only share or more, stating the number of shares, and need be ai- is indebted in the sum of money to which the pr^^ven"!^ calls in arrear amount, in respect of one call or more, upon one share or more, stating the num- ber of calls and the amount of each call, whereby an action has accrued to the company under this Act; and a certificate under their seal, and pur- porting to be signed by any officer of the com- be''evfdence!'' pany, to the effect that the defendant is a share- holder, that such call or calls has or have been made, and that so much is due by him and un- paid thereon, shall be received in all courts as prima facie evidence thereof. 43. The compan}' shall cause a book or books Book to be to be kept by the secretary, or by some other t„®'con°a1n^^'^* officer specially charged with that duty, wherein shall be kept recorded, — (a.) A copy of tlie letters patent incorporating Copy of let- the company, and of any supplementary letters By^iaws^Vc. patent, and of all by-laws thereof ; (6.) The names, alphabetically arranged, of all Names of ^^ , ' i5 1 t v IJ shareholders. persons who are or have been shareholders ; (e.) The address and calling of every such per- Addresses, son, while such .shareholder; (d.) The number of shares of stock held by Number of each shareholder ; (e.) The amounts paid in and remaining un- Amounts paid, respectively, on the stock of each .share- ^"^'''' ^^' holder ; (/.) The names, addresses and calling of all ^j^ectok persons who are or have been directoj's of the companj', with the several dates at which each became or ceased to be such director : 2. A book called the register of transfers shall JJ^f^^fg'/,"^ be provided, and in such book shall be entered the pai'ticulars of every transfer of shares in the capital of the company. uo JOINT STOCK COMPANIES MANUAL. Books to be ojxjii for in- sjKfctinn and taking ex- tracts there- from. 44. Such books slmll, during reasonable busi- ness hours of every ilay, except Sundays and holidays, be kept open for the inspection of share- holders and creditors of the company, and their personal representatives, at the head othce or chief place of business of the company ; and every such shareholder, creditor or personal representative mav make extracts therefrom. Penalty f.-r 45. Kvery director, officer or servant of the false entries, company, who knowingly makes or assists in making any untrue entry in any such book or who refuses or wilfully neglects to make any ])roper entry therein, or to exhibit the .same, or to allow the same to be inspected and extracts to be taken therefrom, is guilty of a misdemeanor. Forfeiture for '^ Kvery conijiany wliieli neglects to keep neglect. such Ixjok or books as aforesaid, shall forfeit its coi|»oiate rights. i;..ok»f t.. be 47. Such Vjooks shall be prima facie evidence P^'?"' ^'""'^ of all facts purporting to be tliereby stated, in any action, suit or proceeding against the company or against any shareholder. Transfer <>f MhareM valid 'inly after entry. Liabilitien of dircctom am ffKardu tranxfom of »h»r«r« in i-pT' tain cnii<- 11 n 1 tainea on ap- settmg forth the tacts and the number of shares plication, previously belonging to the person in whose name such shares stand in the books of the company, and praying for an order or judgment adjudicat- ing and awarding the said shares to the person or persons legally entitled to the same, — by which order or judgment the company shall be guided and held fully harmless and indemnifieil and re- leased from every other claim to the said shares or arising in respect thereof : 2. Notice of the intention to present such peti- Notice of tion shall be given to the person claiming such api'li^a*^*'^- shares, or to the attorney of such person duly authorized for the purpose, who shall upon the 142 JOINT STOCK companies' MANUAL. filing of such petition, establish his right to the shares referred to in such petition ; and the time to jdead and all other proceedings in such cases shall be the s:iine as those observed in analogous Proviso : as to cases before the said superior courts: Pnjvided '^**^- always, that the costs and expenses of procuring such order or judgment shall be paid by the per- son or persons to whom such shares are declared lawfully to V)elong ; and that such shares shall not Ije transferred in the books of the company until such costs and expenses are paid, — saving the recourse of such jjerson against any person contestinfj his right to such shares. Restriction as •5'- ^'^ share shall be transferable until all pre- to transfer. vious calls thereon are fully paid in. As ti transfer •^"^ The directors may decline to register any by (lebt'jr to transfei' of shares belonging to any shareholder company. ^^^^^^^ j^ indebted to the company. Transfer by •*»^- An\' transfer of the .shares or other inter- l>ersonalre- est of a decea.sed shareholder, made by his per- sonal representative, shall, notwithstanding such personal representative is not himself a share- holder, be of the same validity as if he had been a shar'iholder at the time of his execution of the instrument of transfer. Liability ^54 'pi,^. shareholders of the company sliall not, limited to ., -iir iiru amount un- ^« sucli, nc responsible lor any act, detault or pai.l on Mt«H!k. liability of the company, or for any engagement, c];iim, paynn'iit, loss, injury, transaction, maUei- or tiling reliiLiiig to (jr coiinecte therc'on ; but he Hhall not be liable to an action therefor i»y any When U) credit^uch director, nor unless an execu- tion against the coiiijtany in respect of such debt is returned unsatislied in whole oj- in j»art; and the amount unsatisli(*- pul.lislnd in tiic ('. Any 1 iiiii|p:iiiy licictorore incorporated for any |)Ui|io.se or olijcct for which letters patent may be IhsikmI uriiler this Act, wliother under a special or a gem-iiil Act, ami ikjw being a subsi.st- ing and viilifl coipoiation, may aj>ply for letters patent unih-r this Act, and tin- (lovernor in ( 'ouii- cil, upon proof thiit notice of the ap|ilication has been inserted for four weeks in the Canada da- zrttf, may tlirect th(? i.ssue of letters patent incor- porating the sliarelu)lderH of the said com|iany as a company under this Act; and thereupon all the «iich <.hftri.r». ,ight.s or obligations of the former company .shall Kffert of APPENDIX. 147 be transferred to the new company, and all pro- ceedings may be continued or commenced by or against the new company that might have been continued or commenced by or against the old company ; and it shall not be necessary in any such letters patent to set out the names of the shareholders; and after the issue of the letters patent the company shall be governed in all re- spects by the provisions of this Act, except that the liability of the shareholders to creditors of the old company shall remain as at the time of the issue of the letters patent. 70. If a subsisting company applies for the Subsisting issue of letters patent under this Act, the Gover- maj^^appiy for nor in Council may, by the letters patent, extend charters with the powers of the company to such other objects powers! for which letters patent may be issued under this Act as the applicant desires, and as the Governor in Council thinks fit to include in the letters pa- tent, and which have been mentioned in the notice of the application for the same, in the Canada Gazette ; and the Governor in Council may, in the said letters patent, name the first directors of the new company ; and the letters patent may be issued to the new qompany by the name of the old company or by another name. 71. All the provisions of this Act in relation Provisions to the obtaining of supplementary letters patent p'^em^ent^ary*^' by companies incorporated hereunder shall, so far letters patent as applicable, a})ply and extend to applications *° ''^ppiy- for letters patent under the two sections next preceding. 72. The company may have an agency or Agencies in agencies in any city or town in the United King- jom!^ ^°^' dom. 73. No dividend shall be declared which will fjl^^'^^j. "''^ impair the capital of the company. capitaL^'^ 74. Shareholders who hold one-fourth part in Special gene- value of the subscribed stock of the company "^'^ ^^^ ^°^" . may, at any time, call a special meeting thereof 148 JOINT STOCK companies' MANUAL. AcU of com- pany's attor- ney valid. for the transaction of any business specified in such written requisition ami notice as thrv make and issue to that efiect. 7ii. Every deed wliieh any person, lawfully empowered in that behalf by the company as its attorne}', sifjns on behalf of the company, and seals with his seal, .shall be binding on the com- pany and shall have the .same effect as if it was under the .seal of the company. Contract-', Ac, when to be binding on company. 70, Every contract, agreeuient, engagement or bargain made, and every bill of exchange drawn, accepted or indorsed, and every promissory note and cheque made, drawn or indorsed on l)ehalf of the company, Ijy any agent, otticer or servant of the company, in general accordance with his powers as such under the by-laws of the company, shall be binding upon the company ; and in no case shall it be neces.sary to have tlie seal of the company athx»'0 JOlNi" STOCK COMPANIES MANUAL. Liability in additioD. orticial publication of such company, or who signs or authorizes to be signed on behalf of such com- pany any bill of exchange, promissory note, in- dorsement, cheque, order for money or goods, or who issues or authorizes to be issued any bill of parcels, invoice or receipt of the company, where- in its name, with the said word after it, is not mentioned in manner aforesaid, shall incur a pen- alty of two hundred dollars, and shall also he personally liable to the holder of any such bill of exchange, promissory note, cheque, or order foi" mone}' or goods, for the amount thereof, unless the same is duly paid Ity the company. rfoai>ectus. ^o. Every ])ro.spectus of the company, and ctTtairi ^^^*^' ^ every notice inviting persons to sui3scribe for contracts .shares in the company, shall specify the dates entered int<> i.i ri.i x i.» by company, and the iiames or the persons to any contract or be deemed entei'cd into by the company or the i)rt)moters, raudulent. dji-ectors or» trustees thereof, l)ef ore the is.sue of such pro.spectus or notice, whether subject to adoption by the directors or the company or other- wise ; and every prospectus or notice which does not specify the sauift shall, with icsjiect to any peison who takes shares in the conqiany/on the faith of such prospectus or notice, and who has not had notice of such contract, be deemed fraudu- lent on the part of the promoters, directoi-s and officers of tliL' company who knowingly i.ssuc such |>ios|>ectMs or notice. Company not H| TIkj coiiqiany .sliall not lie ImjuihI to see to h! iei.Ij2:t of the execution of any trust, whether express, im- tniiiu j)lied or constructive, in respc^ct of an}' share ; and the receipt of the .shareholder in whose name th(' .saiiH,' stands in tho books of the company, shall be a vjiliil and liinding dischiirgf to the com- pany for any dividmil or money ])ayabl(' in r«:Hpect of Hiich share, anaid. 85. The directors of every company shall lay Fuiuute- before its shareholders a full printed statement of ^t^^chm^^t^ the affairs and financial position of the company ingforelec- at or before each general meeting of the company *''^°*- for the election of directors. 1")2 JOINT STOCK ( O.MPANIF.s' MANUAL. sell K J) CLE. FOini A. PuVilic notice is hereby yivcn that under " The Companies Ad" letters patent have been issued undei- the Great Seal of Canarla, bearing date the day of incorporating [here state names, address and adling of each corpvr<(tur named in the letters patent |,for the purpose o^herc state the undertal-in;/ oftJie Company, as set forth in the letters patent \, l)y the name oi'[here state the name of the Compani/ iis in the letters palent] with a total capital stock of dollars divided into shares of dollars. l)ateent«ry lettat' nt. — .'). At any time, not more than one month after the la«t publication of such notice, the applicants may petition the (iovernorGeneral, through the Secretary of State of CanadH, for the itwue of such bttiirs jtatcnt ; II hat it ihall ronlnin. —('2.) Such petition must rccilr th«^ facts ■♦•t forth in the notice, and must further state tin- aniounL of stock tak«'n by each applicant, and also the amount paid in upon the »t')ck of each applicant, and the iniiniHT in which the same has been paid in, and is held for tin; Company ; INSTRUCTIONS FOR FORMING A COMPANY. 155 A certain amount of stock must he taken. — (3.) The aggregate of the stock so taken must be at least theone half of the total amount of the stock of the Company ; And a certain amount j^aid up thereon. — (4.) The aggregate so paid in thereon must, if the Company be not a Loan Company, be at least ten per cent, thereof ; if the Company be a Loan Company the aggregate so paid in thereon must be at least ten per cent, thereof, and must not be less than one hundred thousand dol- lars. Disposal of amount paid up. — (5 ) Such aggregate must have been paid in to the credit of the Company, or of trustees therefor, and must be standing at such credit in some chartered bank or banks in Canada, unless the object of the Company is one requir- ing that it should own real estate, — in which case any part not more than one-half of such aggregate may be taken as being paid in, if bona fide invested in real estate suitable to such object, duly held by trustees for the Company, and being of the required value over and above all incumbrances thereon. Certain provisions may he inserted in patent. — (6.) The petition may ask for the embodying in the letters patent of any provision which under this Act might be made by by-law of the Company incorporated ; and such provision so embodied shall not, unless provision to the contrary be made in the letters patent, be subject to repeal or alteration by by-law. Preliminary conditions to he estahlishcd — Proof of facts asserted. — 6. Before the letters patent are issued, the applicants must estab- lish to the satisfaction of the Secretary of State, or of such other officer as may be charged by the Governor in Council to report thereon, the sufficiency of their notice and petition, and the truth and sufficiency of the facts therein set forth, and that the proposed name is not the name of any other known incorporated or unin- corporated Company ; and to that end, the Secretary of State, or such other officer, shall take and keep of record any requisite evi- dence in writing, by oath or affirmation, or by solemn declaration. Fees must be paid before action taken. — (3.) No step shall be taken in any department towards the issue of any letters patent or supplementary letters patent under this Act, until after the amount of all fees therefor shall have been duly paid. Copies of certain notices to he published hy the Compamj in local paper. — A copy of every notice of issue of letters patent or sup- 15() JOINT STOCK companies' MANUAL. plenientary letters patent which, under the provisions of this Act, the Secretary of State is required to insert in the Canada Gazette, shall forthwith, after such insertion, be, by the Company to which such notice relates, inserted on four several occasions in at least one newspaper in the county, city or jilace where the head office or chief agency is established." The following is the schedule of Fees payable under the 84th section ot the said Act : " 1. When the proposed Capital Stock of the company is $500,000 or upwards, the fee to be $200. 2. When the proposed Capital Stock is $200,000 or upwards and less than $500,000, $150. 3. When tiie proposed Capital Stock is $10u,000 or upwards and less than §200,000, $100. 4. When the proposed Capital Stock is less than $100,000, $50. 5. Wlien the proposed Capital Stock is $lO,nOO or less than $40,000, $30. On application for Supplementary Letters I'atent the fee to be one-half of that charged on the Original Letters I'atent." All fees must be paid in cash or by an accej)ted checpie made payable to the order of the Honorable the Secretary of State, and must be transmitted to liim by Registered Letter. (J. I'oWJlLL, Cndrr Sccrclary of Si ate. l)epartment ot the Secretary of Slate, Ottawa, I2tli October, IS83. INDEX. Acts. Table of, 9. Actions. By or against company, IS. For enforcement of paj'ment of calls, 40. Advertisements.— ^ee Notices. Affipavits. Proof of matters may be by, 17. Pro\'incial Secretary authorized to take, 17. May be made before Commissioners and Justices of the Peace, 17. Fees for taking, 59. Applicants. Need not be residents of Ontario, 11. Number of, should not be too large, 11. Not less than three, to be Directors, 12. Directors must be, 14. Application. For Letter-- Patent, 12. Shares, 61. Auditors and Auditing, 5-5, .56, .57. Ballot. Election of Directors to be by, 28. Books of Company. Wh.at to contain, 30. To be kept open for inspection, 31. Penalties for false entries in, 31. refusal to allow inspec- tion of, 32. Transfer to be kept, 31. Bonds. Company may issue, 30. Business. Chief place of, 12-14. change of, 23. Bt-Laws. Table of, 90. Directors may make, 29. To change number of Directors, or chief place of business, 23. Divide shares, and increase or de- crease capital, 20, 21, 22. For the allotment, forfeiture, dispo- sal and transfer of st'>ck, 36, 40. the making and payment of calls, 39. For issuing and registering certificates of stock, 29. declaring and paying dividends, 40. regulating terms of service and ([ualifications of Directors, 29. By-Laws. For appointment, security and re- muneration &c., of agents, 29. the holding of meetings and the procedure thereat, 29. Must be confirmed at General Meet- ing, 22, 23, .30. For certain piu-poses must be approv- ed of by shareholders, 22, 23, 30. must be con- firmed by Letters Patent, 22. Calls. When due and payable, 39. Enforcement of payment of, 39. Forfeiture of shares if not paid, 40. Shareholders in arrear, in respect of, cannot vote, 29, Capital. Of company, l\. Maj- be increased, 20-21. Allotment of, when increased, 20. May be decreased, 21. Buna ri'Jc character of increase or de- crease of, 22. Charter. -5ee under Letters Patent. Company. Formation of, 9. . Name of, 12-13. right to. 18. change of, 18, 19, 20. Powers (i, 19, 25, 26. to hold land, 19. Object of, 13, 17. May issue preference stock, 36. Place of opera ions and chief place of business of, 14, 23, 24. ]Must keep books, 30. Obligations, &c., of, not affected by change of name, 18. Ti) make returns, 32. Not to buy certain stoclc, 44. When contracts, &c. , binding on, 43. Constituticn, change of, 19. Formation of, under Dominion Le- gislation, 154. Companies. May be authorized to act as trustee, &c., 47. Incorporated under Imperial Acts may obtain Letters Patent for cer- tain purposes, 10. Winding up of, 96. Registration of winding up order, 98. Consequences of commencing to wind 7 158 INDFX. CoMPAME.<. (Seneml lowers of lifiuiilaton>, 100. 103. Lial'ility of Contribiitories, 104. Lit, luu.st be applicants and share- holders, 13, 14. not be in arrears, 14. Number of, liow regulated, 14, 23. Qualification, election and powers of, 27. Vacancies in board of, how filled, 28. Names, etc., to be entered in books, 31. KefusinK to all. Liability of, 41, 4% 1)1 VI I) EM IS. Directopi may make by-laws respect- ing, 211. Liability of directors for iiiiproi>erly declaring, 4o. Ki.KcrioN. nf IHrectors, Ac, mode of, 27. K\K< I touh. I.i.iliil ties and rights of, 3Ii. iKf-. > li 'Itde of, payable on Letters Pa- t. It, Ac, 4'!. For tiikin/ ullidavits, &c., T/J. a. ■|..l.l.-uf, 1. I- AM'. I'..w.r ..f Company to hold, I'.i. I,tn ( I'.i Patknt. .\iiiiiImt of iterNons re<|Utred to ob tiiin, II. < 'onditioiiH Iwfofr iNHiiti of, 10. .Miiy contain nnnii-N and objuctii dif- fi-ruiit from that in notii.-**, 17. T.. I-. ..M».r.>d in lH.ok, 31. r irregidnrity, \'X '' , Ifd iKiwcrx. 47. Form of, M. Forf<'itnr«' by non*tiMteHts of Directors against ille- tfal Acts, 41. appliciitiou for change of name, 18, 29. Of uljiitrncnt »{ sliares, (il. chIIh, .•'9. nicTlings, 28. apjillcutinn for Supplementary Letters I'atent, 22. publication of . granting of Letti'rx I'iiI'MI, l.i OkKH Kolt ClIIEl' I'lMKoi ISrslNESS. f/ompimy inu-t havr, 12, 14, 23. Okkhkhm. Dirt'ctorH may make By-laws respect- ing, 29. INDEX. 159 Officers. Liability of, for refusal to allow in- spection of books, 31. OxTARio Gazette.— Sec under Notices. Operations of Cojipany. Where carried on, 12, 14. Payment. Of Directors and President, 28, 36. calls, 39. fees before issue of Letters Patent, &c.,-15. Partnership. Conversion of a, into a Joint Stock Company, 54. Penalty For false entries in, or refusal to allow inspection of, books, 31. default in making yearly state- ments, 34. Petition. For Letteis Patent, 14, 16. Evidence of, 16, 20. For Supplementary Letters Patent, 22. Change of name, 19. Must be signed by officers and sealed, Powers. Of Legislature of Ontario, 11. Directors, 29. Company, 19, 2.5, 26. may apply for extend- ed, 24, 2.5, 46. President and Officers. Shall be elected by Directors, 28. Payment of, 28, 36. Preferential Stock, 36. Protest of Directors against ille'-al Acts, 41. Proxy. Form of, 88. Shareholders may vote by, 23, 24, 28, 30, 37. Proof. Of By-laws having been sancti'jned, 23. Boiia-p'ile character of increase or decrease in stock, 22. Notice, 17. Matters by affidavit, 17. Purposes or Ob.ifcts, 12, 13. Returns, Annual, 32. Real Estate. Company may hold, 19. Remarks, and Information, General, .52. Remittances, 6. Re-incorporation. Proceedings to obtain, 46. Letters Patent of, may authorize in- crease of capital, 47. Seal, 20, 23, 24, 30, 40, 59. Securities, 30. Shareholders. Directors must be, 14. Right to vote, 28, 29. Shareholders. Liability of, 88. when capital decrej,sed, 22. No loan by Company to, 44. May call special meeting, 29. In arrear cannot vote, 29. Must api)rove of certain By-law-, 22, 23, 24, 37. List of, to be made annually, 32. List of, must be kept in books, 31. May inspect books, 31. Shares. Amount of each, 12, 14. Application for, 61. Preference and ordinary, 14, 3J. New, must be of same amount as old 23. Forfeiture of, 40. Price of, remarks re, 53. Transfer of, 37. Allotment of, 22, 36. powers of Directors in, 36. Effect of unregistered transfer of, 37. Restrictions a.s to transfer of, ,3". Subdivision of, 20, Number of, held bj' each shareholder, entered in book, 31. Solvent Condition, Company must be IN, 20. Statement of Affairs. To be made annually, 32. Penalty for default, 34. Stock. SubFcriptiim of, must be proved, 15. Amount of capital, 12, 14. Allotment of, 22, 36. Increase of capital, 20. Preference and ordinary, 14, 36. Decrease of capital. 21. By-laws regulating, 20. Not transferable when calls unpaid, 37. Entry of transfer of, may be refused, 37. Sale and transfer of, 37. Liability of shareholders for amount of, 38. Book, nature of, 16. Amounts paid and unpaid on, to be entered in books, 31. Transfers of, to be entered in books, 31. Of other corporations not to be bought, 44. Statutes. Table of, 9. Supplementary L'tters Patent. How obtained, 22, 25. Fees on, 46. * Must be entered in books, 31. Effect of, 25. Suit. By and against Company, 44. Books to be evidence in, 31. 100 INDEX. Suit, Change of name not to atfect 18. Table. ( )f Statutes, 9. (ee-i, 4.">. ftinuH, 1. by-laws, IK). Trustees. Of shares, rights of, 39. Vote, Of two-thirds res o CD CO w Office and Library Chairs, Table!!), and Stool§ ; Bookcases, Sccretaricti, Davenportu, &o. &c. 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