Bill C-5
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Investment Shares |
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Investment
shares
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124. (1) The articles of a cooperative may
provide that the cooperative may issue
investment shares, and if they do, the articles
must set out the following:
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No voting
rights
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(2) Subject to the articles and to this Act, no
right to vote at a meeting of the cooperative
attaches to an investment share.
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Exception
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(3) The articles may provide that
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Limit on
shareholders'
directors
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(4) Despite subsections (2) and (3), neither
the articles nor a unanimous agreement may
provide that the shareholders have the right to
elect more than twenty per cent of the
directors.
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One share,
one vote
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(5) If shareholders are entitled to vote in
accordance with subsection (3) or otherwise in
accordance with this Act, each investment
share entitles the holder to one vote.
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Members may
exercise
shareholder
rights if
shareholders
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(6) Despite section 37, a member who holds
an investment share may exercise any voting
right that holders of investment shares have.
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No-par-value
shares
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125. (1) Investment shares of a cooperative
must be in registered form and without a par
value.
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When
cooperative
continued
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(2) Investment shares of a cooperative that
is continued under this Act are deemed to be
investment shares without a par value.
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Shares in
series
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126. (1) The articles may authorize, subject
to any limitations set out in them and subject
to subsection (2), the issue of any class of
investment shares in one or more series and
may
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Member
authorization
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(2) No investment share may be issued until
the members have authorized the principle of
the issuance of investment shares.
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Series
participation
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(3) If any cumulative dividends or amounts
payable on return of capital in respect of a
series of investment shares are not paid in full,
the investment shares of all series of the same
class must participate rateably in respect of
accumulated dividends and return of capital.
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Restrictions
on series
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(4) No rights, privileges, restrictions or
conditions attached to a series of investment
shares authorized under this section confer a
priority in respect of dividends or return of
capital on a series over any other series of
investment shares of the same class that are
then outstanding.
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Amendment
of articles
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(5) If the directors exercise their authority
under paragraph (1)(b), they must, before the
issue of shares of the series, send to the
Director articles of amendment in the form
that the Director fixes to designate a series of
investment shares.
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Certificate of
amendment
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(6) On receipt of articles of amendment
designating a series of shares under subsection
(5), the Director must issue a certificate of
amendment.
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Effect of
certificate
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(7) The articles of the cooperative are
amended accordingly on the date shown in the
certificate of amendment.
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Pre-emptive
right
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127. (1) If the articles so provide, no
investment shares of any class may be issued
unless the investment shares are first offered
to the shareholders of that class. The
shareholders of that class have a pre-emptive
right to acquire the offered investment shares
in proportion to their holdings of the
investment shares of that class, at the price at
which and on the terms on which those
investment shares are to be offered to others.
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Limitation
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(2) Even if the articles provide the
pre-emptive right referred to in subsection (1),
shareholders have no pre-emptive right to
acquire investment shares that are to be issued
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Commissions
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128. The directors may authorize the
cooperative to pay a reasonable commission
to any person in consideration of the person
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Charge on
investment
shares
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129. (1) Subject to subsection 183(2), the
articles may provide that the cooperative has
a charge on an investment share registered in
the name of a shareholder or the legal
representative of a shareholder for a debt of
the shareholder to the cooperative, including
an amount unpaid as of the date a body
corporate was continued under this Act, in
respect of an investment share issued by it.
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Enforcement
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(2) A cooperative may enforce a charge
referred to in subsection (1) in accordance
with its by-laws.
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Constraints |
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Constraints on
shares
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130. (1) Subject to subsection 290(3), a
cooperative that has issued investment shares
that are or were part of a distribution to the
public, remain outstanding and are held by
more than one person may, by special
resolution of the members and by a separate
special resolution of the shareholders of each
class, amend its articles to constrain
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Exception in
respect of
paragraph
(1)(c)
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(2) Paragraph (1)(c) does not permit a
constraint on the issue, transfer or ownership
of investment shares of any class or series of
which any investment shares are outstanding
unless the investment shares of that class or
series are already subject to a constraint
permitted under that paragraph.
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Limitation of
prohibition of
investment
shares
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(3) If the ownership by a person of
investment shares would adversely affect the
ability of a cooperative or any of its affiliates
or associates to attain or maintain a level of
Canadian ownership or control specified in its
articles that equals or exceeds a specified level
referred to in paragraph (1)(c), the cooperative
may, under that paragraph, limit the number of
investment shares of the cooperative that may
be owned, or prohibit the ownership of
investment shares, by that person.
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Change or
removal of
constraint
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(4) A cooperative referred to in subsection
(1) may, by a special resolution of the
members and by a separate special resolution
of the shareholders of each class, amend its
articles to change or remove any constraint on
the issue, transfer or ownership of its
investment shares.
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Termination
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(5) The directors may, if authorized by a
special resolution effecting an amendment
under subsection (1) or (4), revoke the
resolution before it is acted on without further
approval.
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Regulations
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(6) The Governor in Council may make
regulations with respect to a cooperative that
constrains the issue, transfer or ownership of
its investment shares, prescribing
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Validity of
acts
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(7) An issue or a transfer of an investment
share or an act of a cooperative is valid despite
any failure to comply with this section or the
regulations.
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Sale of
constrained
shares
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131. (1) A cooperative that has constraints
on the issue, transfer or ownership of any class
of investment shares may, in accordance with
any regulations, sell any of the investment
shares that are owned, or that the directors
determine may be owned, contrary to those
constraints, as if it owned the investment
shares, for the purposes of
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Selection of
shares
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(2) The directors must select the investment
shares to be sold under subsection (1) in good
faith and in a manner that does not unfairly
prejudice or disregard the interests of the
holders of the investment shares in the
constrained class as a whole.
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Right to
proceeds
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(3) A person who owned an investment
share that was sold under this section is
divested of all interests in the investment share
and is entitled to receive only the net proceeds
of the sale and any net income on the proceeds.
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Immunity
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(4) Sections 192, 193 and 194 apply to the
person referred to in subsection (3) as if the
proceeds were a security and the person were
a registered owner of the security.
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Trust moneys
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132. (1) The proceeds of a sale under
section 131 are trust moneys in the hands of
the cooperative for the benefit of the person
who is entitled to receive them.
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Handling of
trust moneys
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(2) Trust moneys under this section
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Costs of
administration
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(3) Reasonable costs of administration of
trust moneys referred to in subsection (1) may
be deducted from the trust moneys and any
income earned on them.
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Appointment
of trust
company
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(4) Subject to this section, a cooperative
may transfer any trust moneys referred to in
subsection (1), and the administration of
them, to a trust company in Canada registered
as one under the laws of Canada or a province,
and the cooperative is discharged of all further
liability in respect of the trust moneys.
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Discharge of
cooperative
and trust
company
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(5) A receipt signed by a person entitled
under subsection 131(3) to receive the
proceeds of a sale that constitute trust moneys
under subsection (1) constitutes a complete
discharge of the cooperative and of any trust
company to which trust moneys are
transferred under subsection (4), in respect of
the trust moneys and income earned on them
paid to the person.
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Vesting in
Crown
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(6) Trust moneys described in subsection
(1), together with any income earned on them,
less any taxes and costs of administration, that
has not been claimed by a person entitled
under subsection 131(3) to receive the
proceeds of a sale that constitute the trust
moneys for a period of ten years after the date
of the sale vests in Her Majesty in right of
Canada.
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Escheats Act
applies
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(7) Sections 3 to 5 of the Escheats Act apply
in respect of a trust fund that vests in Her
Majesty in right of Canada under subsection
(6).
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Election of
directors
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133. (1) If the holders of a class or series of
investment shares of a cooperative have,
under section 124, a right to elect or appoint
one or more directors, or have a right to elect
or appoint one or more directors by reason of
an event that has occurred and is continuing or
by reason of a condition that has been fulfilled,
the directors must call the following meetings
for the purpose of electing or appointing the
director or directors:
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Cumulative
voting
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(2) If the articles so provide, directors who
are to be elected by holders of investment
shares may be elected by cumulative voting.
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When
cumulative
voting
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(3) If the articles provide for cumulative
voting,
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Amendment
of articles
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134. (1) The holders of investment shares of
a class or, subject to subsection (4), of a series
are, unless the articles provide otherwise in
the case of an amendment referred to in
paragraphs (a), (b) and (e), entitled to vote
separately as a class or series on a proposal to
amend the articles to
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