Canada Cooperatives Act (S.C. 1998, c. 1)

Marginal note:Distributing cooperative

• 176 (1) If a shareholder holding shares of a distributing cooperative does not receive a notice under this Part, the shareholder may

  • (a) within ninety days after the date of the end of the take-over bid, or

  • (b) if the shareholder did not receive an offer pursuant to the take-over bid, within ninety days after the later of

    • (i) the date of the end of the take-over bid, and

    • (ii) the date on which the shareholder learned of the take-over bid,

  require the offeror to acquire those shares.

• Marginal note:Obligation to acquire

  (2) If a shareholder requires the offeror to acquire shares under subsection (1), the offeror must acquire the shares on the same terms under which the offeror acquired or will acquire the shares of the offerees who accepted the take-over bid.

PART 12Security Certificates, Registers and Transfers

Interpretation

Marginal note:Definitions

• 177 (1) The definitions in this subsection apply in this Part.

  adverse claim

  adverse claim, in respect of a security, includes a claim that a transfer was or would be wrongful or that a particular adverse person is the owner of or has an interest or right in the security. (opposition)

  bearer

  bearer means the person who is in possession of a security that is payable to bearer or endorsed in blank. (porteur)

  broker

  broker means a person who is engaged in whole or in part in the business of buying and selling securities and who, in the transaction concerned, acts for, or buys a security from, or sells a security to a customer. (courtier)

  delivery

  delivery means voluntary transfer of possession. (livraison ou remise)

  fiduciary

  fiduciary means any person who acts in a fiduciary capacity or as the administrator of the property of others and includes a personal representative of a deceased person. (représentant)

  fungible

  fungible, in relation to securities, means securities of which any unit is, by nature or usage of trade, the equivalent of any other like unit. (fongibles)

  genuine

  genuine means free of forgery or counterfeiting. (authentique)

  good faith

  good faith, with respect to a transaction, means honesty in fact in the conduct of the transaction. (bonne foi)

  good faith purchaser

  good faith purchaser, with respect to a security in bearer form or order form or a security in registered form issued to the purchaser or endorsed to the purchaser or endorsed in blank, means a purchaser for value in good faith and without notice of any adverse claim who takes delivery of the security. (acquéreur de bonne foi)

  holder

  holder means a person who is in possession of a security that is issued or endorsed to the person or to bearer or in blank. (détenteur)

  issuer

  issuer includes a cooperative that

  • (a) is required by this Act to maintain a securities register;

  • (b) in Quebec, issues securities that confer directly or indirectly rights in its property; or

  • (c) elsewhere in Canada, directly or indirectly creates fractional interests in its rights or property and issues securities as evidence of the fractional interests. (émetteur)

  overissue

  overissue means the issue of securities in excess of any maximum number of securities that the issuer is authorized by its articles or a trust indenture to issue. (émission excédentaire)

  purchaser

  purchaser means a person who takes an interest or right in a security by sale, mortgage, hypothec, pledge, issue, reissue, gift or any other voluntary transaction. (acquéreur)

  security

  security or security certificate means a document issued by a cooperative that is

  • (a) in bearer, order or registered form,

  • (b) of a type commonly dealt in on securities exchanges or markets or commonly recognized in any area in which it is issued or dealt in as a medium for investment,

  • (c) one of a class or series or by its terms divisible into a class or series of documents, and

  • (d) evidence of an investment share, participation or other interest or right in or obligation of a cooperative,

  but does not include

  • (e) a membership share or a document evidencing a membership share, or

  • (f) a member loan or a document evidencing a member loan. (valeur mobilière ou certificat de valeurs mobilières)

  transfer

  transfer includes transmission by operation of law. (transfert)

  trust indenture

  trust indenture means a trust indenture as defined in section 266. (acte de fiducie)

  valid

  valid means issued in accordance with the applicable law and the articles of the issuer, or validated under section 196. (valide)

• Marginal note:Negotiable instruments

  (2) Except when a transfer is restricted and noted on a security in accordance with subsection 183(2), a security is a negotiable instrument.

• Marginal note:Registerable form

  (3) A security is in registered form if it

  • (a) specifies a person who is entitled to the security or to the rights it evidences, and its transfer is capable of being recorded in a securities register; or

  • (b) bears a statement that it is in registered form.

• Marginal note:Order form

  (4) A debt obligation is in order form if, by its terms, it is payable to the order of a person specified with reasonable certainty in it or to a person to whom it is assigned.

• Marginal note:Bearer form

  (5) A security is in bearer form if it is payable to bearer according to its terms and not by reason of an endorsement.

• Marginal note:Guarantor for issuer

  (6) A guarantor for an issuer is deemed to be an issuer to the extent of the guarantee, whether or not the obligation is noted on the security.

Application

Marginal note:Application

178 This Part governs the transfer or transmission of a security.

Security Certificates

Marginal note:Security certificate

179 Every security holder is entitled, at their option, to obtain from the cooperative

• (a) a security certificate that complies with this Act; or

• (b) a non-transferable written acknowledgement of their right to obtain a security certificate.

Marginal note:Fee

180 A cooperative may charge a reasonable fee for a security certificate issued in respect of a transfer.

Marginal note:Joint owners

181 If securities are held jointly by more than one person,

• (a) a cooperative is not required to issue more than one security certificate in respect of those securities; and

• (b) delivery of a security certificate to one of the joint owners is sufficient delivery to them all.

Marginal note:Signatures

• 182 (1) A security certificate must be signed by at least one of the following persons, or a facsimile of the signature must be reproduced on the certificate:

  • (a) a director, or an individual on their behalf, or an officer;

  • (b) a transfer agent or branch transfer agent of the cooperative, or an individual on their behalf; or

  • (c) a trustee who certifies it in accordance with a trust indenture.

• Marginal note:Former director

  (2) A cooperative may issue security certificates that contain the signature of a person who is no longer a director or officer and the validity of the certificate is not adversely affected.

Marginal note:Contents of certificate

• 183 (1) The following information must be stated on the face of each security certificate issued by a cooperative:

  • (a) the name of the cooperative;

  • (b) the words “Incorporated under the Canada Cooperatives Act”, “constituée sous l’autorité de la Loi canadienne sur les coopératives”, “Subject to the Canada Cooperatives Act” or “assujetti à la Loi canadienne sur les coopératives”;

  • (c) the name of the person to whom it was issued; and

  • (d) the number and class of shares and the designation of any series that the certificate represents.

• Marginal note:Notation of restrictions

  (2) No restriction, charge, lien, hypothec, agreement or endorsement described in subsection (3) is effective against a transferee of a security, issued by a cooperative or by a body corporate before it is continued under this Act, who has no actual knowledge of the restriction, charge, lien, hypothec, agreement or endorsement unless it or a reference to it is noted conspicuously on the security certificate.

• Marginal note:Restrictions, etc.

  (3) The restrictions, charges, liens, hypothecs, agreements and endorsements referred to in subsection (2) are

  • (a) a restriction on transfer other than a constraint under section 130;

  • (b) a charge, lien or hypothec in favour of the cooperative;

  • (c) a unanimous agreement; and

  • (d) an endorsement under subsection 302(10).

• Marginal note:Restrictions

  (4) If the issued investment shares of a distributing cooperative remain outstanding and are held by more than one person, the cooperative must not restrict the transfer or ownership of its investment shares of any class or series except by way of a constraint under section 130.

• Marginal note:Conspicuous notation

  (5) A reference to a constraint on the issue, transfer or ownership of any class or series of investment shares must be noted conspicuously on every security certificate evidencing such a share that is issued after the share becomes subject to the constraint under this Act, if the constraint is one

  • (a) for the purpose of attaining or maintaining a level of Canadian ownership or control specified in its articles or required by law to carry on business or qualify for benefit; or

  • (b) to comply with any prescribed law.

• Marginal note:Effect of failure to note constraint

  (6) A failure to note a constraint under subsection (5) does not invalidate the investment share or the security certificate and does not render the constraint ineffective.

Marginal note:Contents of certificate

• 184 (1) Every share certificate for an investment share of a cooperative that is authorized to issue shares of more than one class or series must clearly state

  • (a) the rights, privileges, restrictions and conditions attached to the shares of each class and series that exist when the share certificate is issued; or

  • (b) that the class or series of shares that it represents has rights, privileges, restrictions or conditions attached to it and that the cooperative will provide a shareholder, on demand and without charge, with a full copy of the text of

    • (i) any rights, privileges, restrictions and conditions attached to each class authorized to be issued, and to each series, that have been fixed by the directors, and

    • (ii) the authority of the directors to fix the rights, privileges, restrictions and conditions of subsequent series.

• Marginal note:Copy of information

  (2) If a share certificate for an investment share contains the statement referred to in paragraph (1)(b), the cooperative must provide the shareholder, on demand and without charge, with a copy of

  • (a) the rights, privileges, restrictions and conditions attached to each class or series of investment shares authorized to be issued; and

  • (b) the authority of the directors to fix the rights, privileges, restrictions and conditions of subsequent series of investment shares in the same class.

Marginal note:Fractional shares

• 185 (1) A cooperative may issue for each fractional investment share, a certificate in registered form or scrip certificates in registered form that entitle the holder to receive a certificate for a full investment share in exchange for scrip certificates equalling a full investment share.

• Marginal note:Replacement

  (1.1) A cooperative must, on the request of a holder of a certificate for a fractional investment share or scrip certificate that is in bearer form and that was issued before the coming into force of this subsection, issue in exchange to that holder, in registered form, a certificate for a fractional investment share or a scrip certificate, as the case may be.

• Marginal note:Conditions

  (2) The directors may attach conditions to scrip certificates issued by the cooperative, including conditions that

  • (a) the scrip certificates become void or, in Quebec, null if not exchanged for an investment share representing a full investment share before a specified date; and

  • (b) any investment shares for which the scrip certificates are exchangeable may, despite any pre-emptive right, be issued by the cooperative to any person and the proceeds distributed rateably to the holders of the scrip certificates.

• Marginal note:Voting rights

  (3) A holder of a fractional investment share is not entitled to exercise voting rights or to receive a dividend in respect of the investment share unless

  • (a) the fractional share results from a consolidation of investment shares; or

  • (b) the articles of the cooperative provide otherwise.

• Marginal note:Exercise of voting rights

  (4) A holder of a scrip certificate is not entitled to exercise voting rights or to receive a dividend in respect of the scrip certificate.