#301-2706 30th Avenue
Vernon, B.C. Canada V1T 2B6
Hours: 8:00 am to 4:30 pm
Monday to Friday
Wheelchair Accessible
Telephone: 250-542-5353
Toll-Free: 1-800-243-5353
Fax: 250-542-7273
Michael Yawney QC was retained by a Vernon woman who was seriously injured while a passenger in a vehicle. Mr. Yawney was actively involved in ensuring that the client received the proper rehabilitation and assistance to promote recovery from her injuries, which included a moderate brain injury. The matter was resolved prior to trial for $2.85 million including future care, future income loss, in trust claims for family members that had to assist the client, as well as the costs of pursuing the legal action to enforce her claim.
Written by: Krystin Kempton, Associate
So you’ve named your company. Now what?
Determining your share structure and shareholders is a key consideration. The ownership of a company is dividedinto shares. Shares can then be divided into classes, which can be used to give shareholders varying rights. Therights and restrictions of a share class include or exclude the right to vote, the right to receive dividends if declaredby the directors, and the right to receive the remaining property of the company after it is dissolved. A company can be incorporated with one class of shares, or multiple classes of shares with different rights and restrictionsapplying to each class, or multiple classes of shares with identical rights and restrictions, or a combination thereof.
All shareholders within one class of shares must be treated equally when dividends are paid out. So if there aretwo class A shareholders – for example, Bob with 25 shares and Mary with 75 shares – and the company declaresan aggregate $100 dividend on the class A shares, Bob will receive $25 and Mary will receive $75. However, if Bobis the only class A shareholder (with his 25 class A shares), and Mary has 75 class B shares, then if the companydeclares a $100 dividend on the class A shares, the $100 is received exclusively by Bob. Having multiple classes ofshares in a company with identical or similar rights and restrictions therefore gives directors the ability to paydividends to some shareholders but not to others as directors “sprinkle” dividends differently across the classes. Itis always important to obtain tax advice from an accountant with respect to determining share structure andpaying out dividends – particularly in light of recent tax changes.
A company has to have at least one shareholder. A shareholder can be a person, a trust, a mutual fund or acorporation. Rights of shareholders include the right to vote at shareholders’ meetings (provided they hold votingshares), the right to receive a share of the profits of the company, the right to examine and copy corporaterecords, financial statements and directors’ reports and the ability approve major or fundamental changes of thecompany. The larger the number of voting shares a shareholder holds, the bigger the impact the shareholder canhave on the company’s major decisions. If you wish to retain control over your company, consider limiting othershareholders (if any) to non-voting shareholders.
Voting shareholders elect the board of directors. Directors are in charge of the overall management of thecompany and must act in the best interests of the company. A company must have at least one director. Officers(i.e., President, Secretary, Treasurer) are appointed by directors and manage the company’s day-to- day operations.Under the Business Corporations Act (British Columbia), officers are optional.
Entering contracts and endorsing cheques on behalf of the company requires the signature of a duly authorizedcompany representative. Consider who should have signing authority for the company – i.e., any director, alldirectors, a specific officer?
Once incorporated, a company is obligated to maintain proper records and meet ongoing reporting obligations byfiling an annual report with supporting resolutions kept in the company’s record book. The British ColumbiaCorporate Registry may dissolve a company if the company fails to file its annual report for two consecutive years.All companies also must file a corporation income tax return every year even if there is no tax payable.
We recommend seeking legal advice to discuss setting up the company’s articles, ensure the incorporation iscompleted properly, understand continuous disclosure requirements in British Columbia and to discuss a potentialshareholders’ agreement to set out the relationship among shareholders if the company has more than oneshareholder, particularly as investors are brought into the company.
#301-2706 30th Avenue
Vernon, B.C. Canada V1T 2B6
Hours: 8:00 am to 4:30 pm
Monday to Friday
Wheelchair Accessible
Telephone: 250-542-5353
Toll-Free: 1-800-243-5353
Fax: 250-542-7273
This site uses cookies. By continuing to browse the site, you are agreeing to our use of cookies.
Accept settingsHide notification onlySettingsWe may request cookies to be set on your device. We use cookies to let us know when you visit our websites, how you interact with us, to enrich your user experience, and to customize your relationship with our website.
Click on the different category headings to find out more. You can also change some of your preferences. Note that blocking some types of cookies may impact your experience on our websites and the services we are able to offer.
These cookies are strictly necessary to provide you with services available through our website and to use some of its features.
Because these cookies are strictly necessary to deliver the website, refusing them will have impact how our site functions. You always can block or delete cookies by changing your browser settings and force blocking all cookies on this website. But this will always prompt you to accept/refuse cookies when revisiting our site.
We fully respect if you want to refuse cookies but to avoid asking you again and again kindly allow us to store a cookie for that. You are free to opt out any time or opt in for other cookies to get a better experience. If you refuse cookies we will remove all set cookies in our domain.
We provide you with a list of stored cookies on your computer in our domain so you can check what we stored. Due to security reasons we are not able to show or modify cookies from other domains. You can check these in your browser security settings.
These cookies collect information that is used either in aggregate form to help us understand how our website is being used or how effective our marketing campaigns are, or to help us customize our website and application for you in order to enhance your experience.
If you do not want that we track your visit to our site you can disable tracking in your browser here:
We also use different external services like Google Webfonts, Google Maps, and external Video providers. Since these providers may collect personal data like your IP address we allow you to block them here. Please be aware that this might heavily reduce the functionality and appearance of our site. Changes will take effect once you reload the page.
Google Webfont Settings:
Google Map Settings:
Google reCaptcha Settings:
Vimeo and Youtube video embeds:
The following cookies are also needed - You can choose if you want to allow them:
You can read about our cookies and privacy settings in detail on our Privacy Policy Page.
Privacy Policy