Canada Business Corporations Act (R.S.C., 1985, c. C-44)

Marginal note:Notice of directors

• 106 (1) At the time of sending articles of incorporation, the incorporators shall send to the Director a notice of directors in the form that the Director fixes, and the Director shall file the notice.

• Marginal note:Term of office

  (2) Each director named in the notice referred to in subsection (1) holds office from the issue of the certificate of incorporation until the first meeting of shareholders.

• Marginal note:Election of directors

  (3) Subject to subsection (3.1) and paragraph 107(b), shareholders of a corporation shall, by ordinary resolution at the first meeting of shareholders and at each succeeding annual meeting at which an election of directors is required, elect directors to hold office for a term ending not later than the close of the third annual meeting of shareholders following the election.

• Marginal note:Election of directors — distributing corporations

  (3.1) Subject to paragraph 107(b), shareholders of a distributing corporation shall, by ordinary resolution at the first meeting of shareholders and at each succeeding annual meeting at which an election of directors is required, elect directors to hold office for a term ending not later than the close of the next annual meeting of shareholders following the election.

• Marginal note:Exceptions — certain distributing corporations

  (3.2) Despite subsection (3.1), in the case of any prescribed class of distributing corporations or in any prescribed circumstances respecting distributing corporations or classes of distributing corporations, the directors are to be elected in accordance with subsection (3).

• Marginal note:Separate vote for each candidate

  (3.3) If the election of directors is for a prescribed corporation, a separate vote of shareholders shall be taken with respect to each candidate nominated for director.

• Marginal note:Majority voting

  (3.4) If, at a meeting of shareholders of a distributing corporation — other than in the case of a prescribed class of distributing corporations — at which an election of directors is required, there is only one candidate nominated for each position available on the board, each candidate is elected only if the number of votes cast in their favour represents a majority of the votes cast for and against them by the shareholders who are present in person or represented by proxy, unless the articles require a greater number of votes.

• Marginal note:Staggered terms

  (4) It is not necessary that all directors elected at a meeting of shareholders hold office for the same term.

• Marginal note:No stated terms

  (5) A director not elected for an expressly stated term ceases to hold office at the close of the first annual meeting of shareholders following the director’s election.

• Marginal note:Incumbent directors

  (6) Despite subsections (2), (3) to (3.2) and (5) and subject to subsection (6.1), if directors are not elected at a meeting of shareholders, the incumbent directors continue in office until their successors are elected.

• Marginal note:Incumbent director not elected

  (6.1) If an incumbent director who was a candidate in an election held in accordance with subsection (3.4) was not elected during the election, the director may continue in office until the earlier of

  • (a) the 90th day after the day of the election; and

  • (b) the day on which their successor is appointed or elected.

• Marginal note:Vacancy

  (7) If, for either of the following reasons, a meeting of shareholders fails to elect the number or the minimum number of directors required by the articles, the directors elected at that meeting may exercise all the powers of the directors if the number of directors so elected constitutes a quorum:

  • (a) a lack of consent, disqualification under subsection 105(1) or the death of any candidates; or

  • (b) a lack of a majority referred to in subsection (3.4).

• Marginal note:Appointment of directors

  (8) The directors may, unless the articles otherwise provide, appoint one or more additional directors, who shall hold office for a term ending not later than the close of the next annual meeting of shareholders, but the total number of directors so appointed shall not exceed one third of the number of directors elected at the previous annual meeting of shareholders.

• Marginal note:Exception

  (8.1) If an individual who was a candidate in an election held in accordance with subsection (3.4) was not elected during that election, the individual is not to be appointed, except in prescribed circumstances, as a director under subsection (8) or 111(1) before the next meeting of shareholders at which an election of directors is required.

• Marginal note:Election or appointment as director

  (9) An individual who is elected or appointed to hold office as a director is not a director and is deemed not to have been elected or appointed to hold office as a director unless

  • (a) he or she was present at the meeting when the election or appointment took place and he or she did not refuse to hold office as a director; or

  • (b) he or she was not present at the meeting when the election or appointment took place and

    • (i) he or she consented to hold office as a director in writing before the election or appointment or within ten days after it, or

    • (ii) he or she has acted as a director pursuant to the election or appointment.