Important Update: Transition to Ontario's Not-for-Profit Corporations Act (ONCA)

For the past two years, our club's Board of Directors have been diligently addressing the legislative changes mandated by the Ontario government for social clubs, specifically the implementation of the Not-for-Profit Corporations Act, 2010 (ONCA). Here we are providing you with a comprehensive update on these changes and their implications for our club.

Understanding the Situation

The Sarnia Golf and Curling Club currently operates with share capital. Under the new ONCA regulations, this structure does not allow for automatic transition. To ensure our continued operation, we must actively seek "continuance" under an alternative Ontario statute by the deadline of October 19, 2026. Failure to comply could result in the dissolution of the club.

The process of dissolving A-certificates in a social club necessitates a significant shift in how assets are distributed upon wind-up. Unlike traditional share structures where proceeds are returned to shareholders, ONCA mandates that any remaining assets, after settling liabilities, be donated to a registered charity. This charity would be selected by the club's members at the time of dissolution, ensuring that the club's legacy contributes to community benefit rather than individual shareholder gain, thereby aligning with the Act's not-for-profit principles.

Strategic Options and Board Recommendation

The Board has carefully evaluated three primary options for continuance:

• Transition under ONCA as a non-share capital corporation.
• Transition under the Ontario Co-operative Corporations Act.
• Transition under the Ontario Business Corporations Act.

Following extensive legal consultation and a thorough review of these options, the Board of Directors recommends that the Sarnia Golf and Curling Club transition under ONCA as a corporation without share capital, maintaining its not-for-profit status. This recommendation is based on our assessment that this option best aligns with the club’s long-term objectives, preserves our not-for-profit integrity, and minimizes potential tax implications for both the club and its members.

Proposed Voting Structure

The Ontario government is currently proposing amendments to ONCA to simplify voting requirements for share capital social clubs, facilitating continuance and mitigating dissolution risks. With the support of our legal counsel, we anticipate that these amendments will enable the establishment of three distinct member classes, each with voting rights proportional to their respective financial commitments. This structured approach aims to ensure equitable representation and align voting power with member contributions.

Actions Taken and Upcoming Steps

The Board of Directors has been actively engaged in the following:

• Reviewing our current corporate structure and share arrangements.
• Preparing amendments to our governing documents to facilitate the transition to a non-share capital structure.
• Updating the bylaws to reflect the necessary changes for compliance.
• Preparing for a Vote of the required changes at the May 14, 2025 AGM.

Commitment to the Club’s Future

The Board has been working diligently on these compliance requirements and is now nearing the completion of this transition. We are committed to ensuring the continued success of the Sarnia Golf and Curling Club for generations to come.

We understand that you may have questions, and we encourage you to attend our upcoming member meetings for further clarification.

Sincerely,
The Board of Directors Sarnia Golf and Curling Club