Not-for-Profit Information

Definition of Not-for-Profit

Programs licensed by the Ministry of Education in accordance with the regulations under the Child Care and Early Years Act and which are incorporated as non-profit are:

• Programs operated by municipalities
• Programs incorporated under the auspices of a Church denomination or other religious organization
• Programs operated under a special bill of the Ontario of Federal Legislature
• Programs operated by Canadian Forces Bases and which are non-profit
• Programs incorporated under the Ministry of Training, Colleges and Universities
• Programs which are operated by a corporation without share capital to which Part III of the Corporations Act applies
• Programs which are operated by a corporation that is incorporated under the Cooperative Corporations Act and that has articles providing that the corporation will be carried on without purpose of gain for its members.

Provisions Required for Letters Patent of a Not-for-Profit Corporation

The following corporations are required to amend their letters patent:

• Programs that are operated by a corporation without share capital to which Part III of the Corporations Act applies
• Programs that are operated by a corporation that is incorporated under the Co-operative Corporations Act and that has articles providing that the corporation will be carried on without purpose of gain for its members.

The above mentioned non-profit corporations are required to include the following 10 provisions in their letters patent:

1. The corporation shall have at least five directors
2. No employee of the corporation may be a director of it
3. The corporation shall not purchase goods or services from any director, officer or person related to a director or officer of the corporation unless there is only one available source of the goods or services within a reasonable distance of the day nursery
4. The corporation shall not sell goods or services, other than child care services, to any director, officer or person related to a director or officer of the corporation
5. The corporation shall not lend money to or borrow money from any director, officer or person related to a director or officer of the corporation
6. The corporation shall not rent property to or from any director, officer or person related to a director or officer of the corporation
7. The corporation shall not engage in any other transaction which may directly or indirectly confer a financial benefit on one of its directors
8. The directors of the corporation shall serve as directors without remuneration but may be reimbursed for reasonable expenses incurred in the performance of their duties
9. No director of the corporation shall directly or indirectly receive any form of money or money’s worth as a result of his or her position as director
10. Upon dissolution of the corporation and after payment of all of its debts and liabilities, the remaining property of the corporation shall be distributed or disposed of only to charitable or non-profit organizations which provide child care, which are beneficial to the community and which operate solely in Ontario.

For the purposes of this document, a person is related to a director or officer if:

• The person is married or living with a director or officer
• The person is the son or daughter or mother or father of the director or officer
• The person is a relative of the director or officer and they have the same home
• The person is a corporation and voting securities in the corporation that together carry more than 10% of the voting rights attached to all voting securities of the corporation outstanding at the time are beneficially owned directly or indirectly by any combination of:
  • The director or officer
  • Any of the persons referred to in clauses (i) to (iv), and
  • The partner or the employer of the director or officer.