The document that sets out the share capital is of particular importance among the documents that make up a corporation's articles of incorporation. This document, which is generally attached as a schedule to government forms, has two distinct roles: it specifies the legal relationship that will form between the issuing company and those who subscribe to its shares and it defines the allocation of basic rights between the shareholders as well as any other rights they might have in the corporation.

Our share capital template is versatile and can be adapted to suit the needs of most SMEs.

When incorporating a business, it should be noted that the share capital creates the rights that the shareholders’ agreement governs. We, therefore, recommend that you consult our Unanimous Shareholder Agreement template (B02500) to familiarize yourself with this important element associated with the incorporation of a business.

1.00 CLASS “A” SHARES (COMMON)

1.01 Voting Right
1.02 Dividend
1.03 Return of Capital
1.04 Participation
1.05 Conversion Right
1.06 Redemption Right
1.07 Redemption Procedure
1.08 Purchase by Agreement
1.09 Series
1.10 Veto
1.11 Security
1.12 Pre-emptive Right

2.00 CLASS “B” SHARES (PROFIT-SHARING)

2.01 Voting Right
2.02 Dividend
2.03 Return of Capital
2.04 Participation
2.05 Conversion Right
2.06 Redemption Right
2.06.01 At Option of Corporation
2.06.02 At Option of Holder
2.07 Redemption Procedure
2.07.01 At Option of Corporation
2.07.02 At Option of Holder
2.08 Purchase by Agreement
2.09 Series
2.10 Veto
2.11 Security
2.12 Pre-emptive Right

3.00 CLASS “C” SHARES (FROZEN)

3.01 Voting Right
3.02 Dividend
3.03 Return of Capital
3.04 Participation
3.05 Conversion Right
3.06 Redemption Right
3.06.01 At Option of Corporation
3.06.02 At Option of Holder
3.07 Redemption Procedure
3.07.01 At Option of Corporation
3.07.02 At Option of Holder
3.08 Purchase by Agreement
3.09 Series
3.10 Veto
3.11 Security
3.12 Pre-emptive Right

4.00 CLASS “D” SHARES (INTERNAL FINANCING)

4.01 Voting Right
4.02 Dividend
4.03 Return of Capital
4.04 Participation
4.05 Conversion Right
4.06 Redemption Right
4.06.01 At Option of Corporation
4.06.02 At Option of Holder
4.07 Redemption Procedure
4.07.01 At Option of Corporation
4.07.02 At Option of Holder
4.08 Purchase by Agreement
4.09 Series
4.10 Veto
4.11 Security
4.12 Pre-emptive Right

5.00 CLASS “E” SHARES (EXTERNAL FINANCING)

5.01 Voting Right
5.02 Dividend
5.03 Return of Capital
5.04 Participation
5.05 Conversion Right
5.06 Redemption Right
5.06.01 At Option of Corporation
5.06.02 At Option of Holder
5.07 Redemption Procedure
5.07.01 At Option of Corporation
5.07.02 At Option of Holder
5.08 Purchase by Agreement
5.09 Series
5.10 Veto
5.11 Security
5.12 Pre-emptive Right

6.00 REDEMPTION PROCEDURE

6.01 Redemption at Option of Corporation
6.01.01 Notice
6.01.02 Handing Over of Certificates
6.01.03 Failure to Hand Over Certificates
6.01.04 Partial Redemption
6.02 Redemption at Option of Holder
6.02.01 Notice
6.02.02 Handing Over of Certificates
6.02.03 Payment
6.02.04 Personal Right

7.00 REDEMPTION PRICE

7.01 Definitions
7.02 Fair Market Value
7.03 Reassessment
7.04 Contesting Assessment
7.05 Adjustment
7.06 Payment
7.07 Dividend
7.08 Reduction of Issued and Paid-up Share Capital