established within Canada, but not elsewhere, except with the approval of a majority of the members present or represented at the annual meeting, or at a special general meeting called for that purpose.

10. Every holder of a share or shares in the guarantee fund Members of shall be a member of the Company. the Company.

2. Every person whose life is insured under a participating policy or policies of the Company for one thousand dollars or upwards, and who has paid all premiums due thereon, whether such person is a guarantor or not, shall be a member of the Company and be entitled to attend and vote in person or by proxy at all general meetings of the Company, but policy-holders as such shall not be entitled to vote for guarantors' directors.

members.

3. No member as such shall be liable for any act, default or Liability of liability of the Company beyond the premium payable on his policy or beyond the amount unpaid on his shares in the guarantee fund and the premium, if any, on said shares.

11. Every proxy representing a guarantor shall be a guar- Proxies. antor and entitled to vote.

2. Every proxy representing a policy-holder shall be a participating policy-holder and entitled to vote.

3. The authority in writing to such proxy must, unless the directors otherwise order, be filed with the secretary at least seven days previous to its being used. No person employed by the Company as an agent to solicit life insurance, shall act as proxy, nor shall he himself, or by another, ask for, receive, procure or obtain any proxy.

12. Every person whose life is insured under a participating Votes. policy or policies of the Company for one thousand dollars or upwards, and who has paid all premiums due thereon as aforesaid, shall be entitled to one vote, either in person or by proxy, and every guarantor shall be entitled to one vote, either in person or by proxy, for every share he holds in the guarantee fund; but no guarantor shall, by virtue of the number of shares held by him, in any case be entitled to more than fifty votes.

fund, liability

13. The guarantee fund shall be liable for the payment of Guarantee losses, and may be used for the purposes of the Company in and use. such manner and to such extent as the directors may by by-law determine.

of guarantee fund.

2. The guarantee fund, or part thereof, may be redeemed by Redemption the Company, out of the reserve fund surplus or other funds properly available for that purpose, at such times and upon such terms as have first been decided by a two-thirds majority of the members present at a special general meeting called for that purpose and as have then been approved by the Superin- Redemption tendent of Insurance; but the redemption price shall not be less price.

Interest payable.

After

redemption how profits

than the paid up subscription price, including premium, if any, of such guarantee fund with interest thereon at the rate of not less than seven per cent and not more than eight per cent per annum compounded annually from the date of payment of such subscription, after crediting interest paid by the Company from time to time on said guarantee fund.

3. Until redemption the directors may, when earned by the Company, pay to the holders of shares in the guarantee fund interest upon the amount paid up, including premium, if any, but not more than the minimum amount of interest which would be payable if the shares were being redeemed under subsection two of this section.

4. After the redemption of the guarantee fund the whole divisible profits of the Company shall belong exclusively to distributed. participating policy-holders, and shall be distributed amongst them at such times and in such manner as the directors determine.

Election of directors.

Directors and

officers not to

borrow

money or receive

5. At the next annual meeting of the Company after such redemption the participating policy-holders who are members of the Company shall elect a full board of twenty directors.

14. A director or officer of the Company shall not become a borrower of its funds, nor shall he receive commission on assurances effected in the Company, either on his own life or commissions on the life or lives of any other person, nor shall he be personally interested, financially or otherwise, in any agency contract made with the Company, nor shall he receive any commission or compensation for procuring or facilitating loans from or to the Company or for the purchase or sale of securities.

Redemption fund.

Establishment of special

sections or classes.

Division of net profits.

15. If the guarantee fund has been subscribed at a premium the directors may, from time to time, transfer to a redemption fund, such sums out of the accumulated surpluses of the Company as they may determine, until the whole amount of the original premium on the guarantee fund has been set apart.

16. The Company may establish special sections or classes of policy-holders, and may allot profits to policy-holders, in respect of participating policies held by the policy-holders in any such sections or classes, according to a rate or scale different from those in respect of participating policies held by policy-holders in other sections or classes, regard being had always to the rates of premiums paid in respect of such policies, to the mortality experienced in the respective sections or classes, and to such other circumstances as the directors may deem material.

17. The directors may from time to time set apart such portion of the net profits as they deem safe and proper for distribution among participating policy-holders, regard being had to

the provisions of the last preceding section, ascertaining the part thereof which has been derived from participating policies and distinguishing such part from the profits derived from other sources, and the holders of such policies shall be entitled to share in that portion of the profits which has been so distinguished as having been derived from such participating policies to the exent of not less than ninety per cent thereof; but no dividend shall at any time be declared or paid out of estimated profits and the portion of such profits which remains undivided. upon the declaration of a dividend shall never be less than onefifth of the dividend declared.

issue of

18. Whenever any holder of a policy, other than a term or Compulsory natural premium policy, has paid three or more annual pre- paid-up miums thereon, and fails to pay any further premium, or desires policies. to surrender the policy, the premiums paid shall not be forfeited, but he shall be entitled to receive a paid-up and commuted policy for such sum as the directors ascertain and determine, or to be paid in cash such sum as the directors fix as the surrender value of the policy, such sum in either case to be ascertained upon principles to be adopted by by-law applicable generally to all such cases as may occur; provided that if such paid-up and commuted policy is in force, or within twelve months after default has been made in payment of a premium thereon, the Company shall, without any demand therefor, either issue such paid-up and commuted policy, or pay to, or place to the credit of, the policy-holder such cash surrender value.

fund.

19. For the purpose of conducting the affairs of the Com- Staff pension pany in the most efficient manner in the interests of its members, the directors may make by-laws providing for the creation of a staff pension fund; but such by-laws shall, before becoming effective, be submitted and approved at a meeting of the members of the Company.

20. Except as herein otherwise specially provided, this Application Act and the Company and the exercise of the powers hereby R. S., c. 34. conferred shall be subject to the provisions of The Insurance Act.

21. Notwithstanding anything contained therein, or in Application any other Act, Part II. of The Companies Act, except sections R. S., c. 79, 141 and 165 thereof, shall apply to the Company, in so far as Part II. it is not inconsistent with any of the provisions of this Act or R. S., c. 34. of The Insurance Act

OTTAWA: Printed by SAMUEL EDWARD DAWSON, Law Printer to the King's

most Excellent Majesty.

CHAP. 126.

An Act respecting the Royal Victoria Life Insurance

Company.

[Assented to 22nd March, 1907.]

WHEREAS the Royal Victoria Life Insurance Company Preamble.

has by its petition prayed that it be enacted as hereinafter 1897, c. 81. set forth, and it is expedient to grant the prayer of the said petition: Therefore His Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

may make

of shares

1. The directors of the Royal Victoria Life Insurance Com- Directors pany, hereinafter called "the Company," may, at any time after by-law to being duly authorized by a resolution approved by the votes of reduce value shareholders representing at least two-thirds of all the sub- and cancel scribed stock of the Company at a special general meeting duly paid-up called for considering such resolution, pass a by-law,—

(a) for cancelling so much of the subscribed stock of the Company, by reducing the par value of the shares, as has been so authorized by the shareholders as aforesaid; and

(b) for writing off the paid-up capital stock of the Company

so much thereof as is authorized by the said shareholders.

stock.

2. Such by-law shall declare the par value of the shares as so Provisions reduced, and the amount paid up thereon, which shall not ex- of by-law. ceed ten per cent.

3. The liability of the shareholders shall remain the same as if Liability of no reduction had been made in the subscribed capital thereof, shareholders or in the amount paid up thereon, and shall not be affected

thereby.

stock may

4. The subscribed capital stock shall be reduced by the Cancelled amount so cancelled, which amount shall be available for sub- be re-issued. scription and issue as if such stock had not been previously subscribed or issued.