A Canadian Shareholders’ Resolution is a formal written document by which the shareholders of a corporation approve, authorize, or ratify a specific matter that falls within the shareholders’ authority under the applicable corporate legislation. Shareholders’ resolutions can be passed at a duly convened shareholders’ meeting or, for private corporations, by written resolution signed by all shareholders entitled to vote, in lieu of a meeting.

Under the Canada Business Corporations Act (CBCA), there are two types of shareholders’ resolutions. An ordinary resolution requires a simple majority (more than 50%) of the votes cast by shareholders entitled to vote on the resolution. A special resolution, as defined in CBCA s. 2(1), requires a majority of not less than two-thirds (66.67%) of the votes cast. Special resolutions are required for fundamental changes under CBCA s. 173, which includes amending the articles of incorporation, changing the corporation’s name, amalgamation under s. 183, continuance to another jurisdiction under s. 188, and voluntary dissolution under s. 211.

CBCA s. 142(1) permits shareholders to pass resolutions in writing without holding a formal meeting, provided the resolution is signed by all shareholders entitled to vote. This is widely used by private corporations (Canadian-controlled private corporations, or CCPCs) where convening a formal meeting is impractical. Most provincial business corporations acts (OBCA, BCBCA, ABCA, QBCA) have equivalent provisions.

Importantly, CBCA s. 190 provides a dissent right (appraisal remedy) for shareholders who dissent from certain special resolutions approving fundamental changes. A dissenting shareholder may require the corporation to purchase their shares at fair value. The dissent right is a critical minority shareholder protection mechanism.

If the corporation has a unanimous shareholder agreement (USA) under CBCA s. 146, the USA may alter the allocation of powers between directors and shareholders, impose additional consent requirements, or change voting thresholds. All shareholder resolutions must be consistent with any existing USA.

When shareholders need to appoint or replace the corporation’s auditor, which is a statutory requirement for most CBCA corporations (unless the corporation qualifies for the audit exemption under CBCA s. 163).

When the corporation’s annual general meeting requires shareholders to elect or re-elect directors to the board, approve the financial statements, and transact other routine business.

When the corporation proposes a fundamental change requiring a special resolution, such as amending the articles of incorporation to change the share structure, increase authorized capital, change the corporation’s name, or add restrictions on share transfers.

When the corporation is undertaking an amalgamation under CBCA s. 183, a continuance to another jurisdiction under CBCA s. 188, or a voluntary dissolution under CBCA s. 211, all of which require a special resolution of shareholders.

When the corporation is issuing new shares and the articles or a shareholder agreement require shareholder approval for share issuances.

When shareholders need to approve a major transaction, such as the sale of all or substantially all of the corporation’s assets, which requires a special resolution under CBCA s. 189.

When a private corporation with a small number of shareholders prefers to pass resolutions by written consent in lieu of a formal meeting, as permitted by CBCA s. 142(1).

Operating without proper shareholder resolutions can invalidate corporate actions, expose directors to personal liability, and create grounds for shareholder oppression claims under CBCA s. 241.

Resolution Type — Whether the resolution is ordinary (simple majority, 50%+1) or special (two-thirds majority, 66.67%). The type determines the voting threshold required for approval and dictates whether dissent rights are available.

Resolution Method — Whether the resolution is passed at a shareholders’ meeting or by written resolution in lieu of a meeting under CBCA s. 142(1). Written resolutions must be signed by all shareholders entitled to vote.

Resolution Category — The specific matter being resolved, such as election of directors, appointment of auditor, amendment of articles, amalgamation, continuance, dissolution, share issuance, or approval of a major transaction. The category determines whether an ordinary or special resolution is required.

Resolution Text — The complete wording of the resolution, beginning with "BE IT RESOLVED THAT" (ordinary) or "BE IT RESOLVED AS A SPECIAL RESOLUTION THAT" (special). The text must be precise and unambiguous, as it constitutes the formal corporate record.

Shareholder Details — The names of all shareholders entitled to vote, the number and class of voting shares held by each, and their signatures. For written resolutions, all shareholders must sign.

Authorization Clause — A standard clause authorizing directors and officers to execute all documents and take all actions necessary to give effect to the resolution, including filing articles of amendment or other documents with Corporations Canada or the applicable provincial registry.

Special Resolution Requirements — For special resolutions, acknowledgement of the two-thirds voting threshold under CBCA s. 2(1), the specific fundamental change authorized under CBCA s. 173, and the availability of dissent rights under CBCA s. 190.

Consistency with Unanimous Shareholder Agreement — Confirmation that the resolution is consistent with any existing unanimous shareholder agreement under CBCA s. 146.

Governing Law — The province or territory whose laws, together with the applicable federal legislation, govern the resolution.