GreatNorthCollective/greatnorth-canada-federal-laws-text huggingface dataset:
Canada Business Corporations Act — C-44 28
Pre-emptive right 28 (1) If the articles so provide, no shares of a class shall be issued unless the shares have first been offered to the shareholders holding shares of that class, and those shareholders have a pre-emptive right to acquire the offered shares in proportion to their holdings of the shares of that class, at such price and on such terms as those shares are to be offered to others. Exception (2) Notwithstanding that the articles provide the pre-emptive right referred to in subsection (1), shareholders have no pre-emptive right in respect of shares to be issued (a) for a consideration other than money; (b) as a share dividend; or (c) pursuant to the exercise of conversion privileges, options or rights previously granted by the corporation. 1974-75-76, c. 33, s. 28; 1978-79, c. 9, s. 1(F)
Canada Business Corporations Act — C-44 29
Options and rights 29 (1) A corporation may issue certificates, warrants or other evidences of conversion privileges, options or rights to acquire securities of the corporation, and shall set out the conditions thereof (a) in the certificates, warrants or other evidences; or (b) in certificates evidencing the securities to which the conversion privileges, options or rights are attached. Transferable rights (2) Conversion privileges, options and rights to acquire securities of a corporation may be made transferable or non-transferable, and options and rights to acquire may be made separable or inseparable from any securities to which they are attached. Reserved shares (3) Where a corporation has granted privileges to convert any securities issued by the corporation into shares, or into shares of another class or series, or has issued or granted options or rights to acquire shares, if the articles limit the number of authorized shares, the corporation shall reserve and continue to reserve sufficient authorized shares to meet the exercise of such conversion privileges, options and rights. R.S., 1985, c. C-44, s. 29; 2001, c. 14, s. 16(F)
Canada Business Corporations Act — C-44 29.1
Restriction regarding bearer shares 29.1 (1) Despite section 29, a corporation shall not issue, in bearer form, a certificate, warrant or other evidence of a conversion privilege, option or right to acquire a share of the corporation. Replacement (2) A corporation shall, on the request of a holder of a certificate, warrant or other evidence of a conversion privilege, option or right to acquire a share of the corporation that is in bearer form and that was issued before the coming into force of this section, issue in exchange to that holder, in registered form, a certificate, warrant or other evidence, as the case may be. 2018, c. 8, s. 7
Canada Business Corporations Act — C-44 30
Corporation holding its own shares 30 (1) Subject to subsection (2) and sections 31 to 36, a corporation (a) shall not hold shares in itself or in its holding body corporate; and (b) shall not permit any of its subsidiary bodies corporate to acquire shares of the corporation. Subsidiary holding shares of its parent (2) Subject to section 31, a corporation shall cause a subsidiary body corporate of the corporation that holds shares of the corporation to sell or otherwise dispose of those shares within five years from the date (a) the body corporate became a subsidiary of the corporation; or (b) the corporation was continued under this Act. R.S., 1985, c. C-44, s. 30; 2001, c. 14, s. 17; 2011, c. 21, s. 20(F)
Canada Business Corporations Act — C-44 31
Exception 31 (1) A corporation may in the capacity of a personal representative hold shares in itself or in its holding body corporate unless it or the holding body corporate or a subsidiary of either of them has a beneficial interest in the shares. Idem (2) A corporation may hold shares in itself or in its holding body corporate by way of security for the purposes of a transaction entered into by it in the ordinary course of a business that includes the lending of money. Exception — subsidiary acquiring shares (3) A corporation may permit any of its subsidiary bodies corporate to acquire shares of the corporation (a) in the subsidiary’s capacity as a personal representative, unless the subsidiary would have a beneficial interest in the shares; or (b) by way of security for the purposes of a transaction entered into by the subsidiary in the ordinary course of a business that includes the lending of money. Exception — conditions precedent (4) A corporation may permit any of its subsidiary bodies corporate to acquire shares of the corporation through the issuance of those shares by the corporation to the subsidiary body corporate if, before the acquisition takes place, the conditions prescribed for the purposes of this subsection are met. Conditions subsequent (5) After an acquisition has taken place under the purported authority of subsection (4), the conditions prescribed for the purposes of this subsection must be met. Non-compliance with conditions (6) If (a) a corporation permits a subsidiary body corporate to acquire shares of the corporation under the purported authority of subsection (4), and (b) either (i) one or more of the conditions prescribed for the purposes of subsection (4) were not met, or (ii) one or more of the conditions prescribed for the purposes of subsection (5) are not met or cease to be met, then, notwithstanding subsections 16(3) and 26(2), the prescribed consequences apply in respect of the acquisition of the shares and their issuance. R.S., 1985, c. C-44, s. 31; 2001, c. 14, s. 18; 2011, c. 21, s. 21
Canada Business Corporations Act — C-44 32
Exception relating to Canadian ownership 32 (1) Subject to subsection 39(8), a corporation may, for the purpose of assisting the corporation or any of its affiliates or associates to qualify under any prescribed law of Canada or a province to receive licences, permits, grants, payments or other benefits by reason of attaining or maintaining a specified level of Canadian ownership or control, hold shares in itself that (a) are not constrained for the purpose of assisting the corporation or any of its affiliates or associates to so qualify; or (b) are shares into which shares held under paragraph (a) were converted by the corporation that are constrained for the purpose of assisting the corporation to so qualify and that were not previously held by the corporation. Prohibited transfers (2) A corporation shall not transfer shares held under subsection (1) to any person unless the corporation is satisfied, on reasonable grounds, that the ownership of the shares as a result of the transfer would assist the corporation or any of its affiliates or associates to achieve the purpose set out in subsection (1). Offence (3) A corporation that, without reasonable cause, fails to comply with subsection (2) is guilty of an offence and liable on summary conviction to a fine not exceeding five thousand dollars. Directors of corporation (4) Where a corporation commits an offence under subsection (3), any director of the corporation who knowingly authorized, permitted or acquiesced in the commission of the offence is a party to and guilty of the offence and is liable on summary conviction to a fine not exceeding five thousand dollars or to imprisonment for a term not exceeding six months or to both, whether or not the corporation has been prosecuted or convicted. Where shares are transferred (5) Where shares held under subsection (1) are transferred by a corporation, subsections 25(1), (3), (4) and (5), paragraph 115(3)(c) and subsection 118(1) apply, with such modifications as the circumstances require, in respect of the transfer as if the transfer were an issue. Transfer not void, voidable or null (6) No transfer of shares by a corporation shall be void, voidable or, in Quebec, null solely because the transfer is in contravention of subsection (2). R.S., 1985, c. C-44, s. 32; 2011, c. 21, s. 22
Canada Business Corporations Act — C-44 33
Voting shares 33 (1) A corporation holding shares in itself or in its holding body corporate shall not vote or permit those shares to be voted unless the corporation (a) holds the shares in the capacity of a personal representative; and (b) has complied with section 153. Subsidiary body corporate (2) A corporation shall not permit any of its subsidiary bodies corporate holding shares in the corporation to vote, or permit those shares to be voted, unless the subsidiary body corporate satisfies the requirements of subsection (1). R.S., 1985, c. C-44, s. 33; 2001, c. 14, s. 19; 2011, c. 21, s. 23
Canada Business Corporations Act — C-44 34
Acquisition of corporation’s own shares 34 (1) Subject to subsection (2) and to its articles, a corporation may purchase or otherwise acquire shares issued by it. Limitation (2) A corporation shall not make any payment to purchase or otherwise acquire shares issued by it if there are reasonable grounds for believing that (a) the corporation is, or would after the payment be, unable to pay its liabilities as they become due; or (b) the realizable value of the corporation’s assets would after the payment be less than the aggregate of its liabilities and stated capital of all classes. R.S., 1985, c. C-44, s. 34; 2001, c. 14, s. 20(F)
Canada Business Corporations Act — C-44 35
Alternative acquisition of corporation’s own shares 35 (1) Notwithstanding subsection 34(2), but subject to subsection (3) and to its articles, a corporation may purchase or otherwise acquire shares issued by it to (a) settle or compromise a debt or claim asserted by or against the corporation; (b) eliminate fractional shares; or (c) fulfil the terms of a non-assignable agreement under which the corporation has an option or is obliged to purchase shares owned by a director, an officer or an employee of the corporation. Idem (2) Notwithstanding subsection 34(2), a corporation may purchase or otherwise acquire shares issued by it to (a) satisfy the claim of a shareholder who dissents under section 190; or (b) comply with an order under section 241. Limitation (3) A corporation shall not make any payment to purchase or acquire under subsection (1) shares issued by it if there are reasonable grounds for believing that (a) the corporation is, or would after the payment be, unable to pay its liabilities as they become due; or (b) the realizable value of the corporation’s assets would after the payment be less than the aggregate of (i) its liabilities, and (ii) the amount required for payment on a redemption or in a liquidation of all shares the holders of which have the right to be paid before the holders of the shares to be purchased or acquired, to the extent that the amount has not been included in its liabilities. R.S., 1985, c. C-44, s. 35; 2001, c. 14, s. 21
Canada Business Corporations Act — C-44 36
Redemption of shares 36 (1) Notwithstanding subsection 34(2) or 35(3), but subject to subsection (2) and to its articles, a corporation may purchase or redeem any redeemable shares issued by it at prices not exceeding the redemption price thereof stated in the articles or calculated according to a formula stated in the articles. Limitation (2) A corporation shall not make any payment to purchase or redeem any redeemable shares issued by it if there are reasonable grounds for believing that (a) the corporation is, or would after the payment be, unable to pay its liabilities as they become due; or (b) the realizable value of the corporation’s assets would after the payment be less than the aggregate of (i) its liabilities, and (ii) the amount that would be required to pay the holders of shares that have a right to be paid, on a redemption or in a liquidation, rateably with or before the holders of the shares to be purchased or redeemed, to the extent that the amount has not been included in its liabilities. R.S., 1985, c. C-44, s. 36; 2001, c. 14, s. 22
Canada Business Corporations Act — C-44 37
Gift or legacy of shares 37 A corporation may accept from any shareholder a share of the corporation surrendered to it as a gift including, in Quebec, a legacy but may not extinguish or reduce a liability in respect of an amount unpaid on any such share except in accordance with section 38. R.S., 1985, c. C-44, s. 37; 2011, c. 21, s. 24
Canada Business Corporations Act — C-44 38
Other reduction of stated capital 38 (1) Subject to subsection (3), a corporation may by special resolution reduce its stated capital for any purpose including, without limiting the generality of the foregoing, for the purpose of (a) extinguishing or reducing a liability in respect of an amount unpaid on any share; (b) distributing to the holder of an issued share of any class or series of shares an amount not exceeding the stated capital of the class or series; and (c) declaring its stated capital to be reduced by an amount that is not represented by realizable assets. Contents of special resolution (2) A special resolution under this section shall specify the stated capital account or accounts from which the reduction of stated capital effected by the special resolution will be deducted. Limitation (3) A corporation shall not reduce its stated capital for any purpose other than the purpose mentioned in paragraph (1)(c) if there are reasonable grounds for believing that (a) the corporation is, or would after the reduction be, unable to pay its liabilities as they become due; or (b) the realizable value of the corporation’s assets would thereby be less than the aggregate of its liabilities. Recovery (4) A creditor of a corporation is entitled to apply to a court for an order compelling a shareholder or other recipient (a) to pay to the corporation an amount equal to any liability of the shareholder that was extinguished or reduced contrary to this section; or (b) to pay or deliver to the corporation any money or property that was paid or distributed to the shareholder or other recipient as a consequence of a reduction of capital made contrary to this section. Limitation (5) An action to enforce a liability imposed by this section may not be commenced after two years from the date of the act complained of. (6) [Repealed, 2001, c. 14, s. 23] R.S., 1985, c. C-44, s. 38; 2001, c. 14, s. 23
Canada Business Corporations Act — C-44 39
 change of shares (9) Shares issued by a corporation and converted into shares of another class or series or changed under section 173, 191 or 241 into shares of another class or series shall become issued shares of the class or series of shares into which the shares have been converted or changed. Effect of change of shares on number of unissued shares (10) Where the articles limit the number of authorized shares of a class of shares of a corporation and issued shares of that class or of a series of shares of that class have become, pursuant to subsection (9), issued shares of another class or series, the number of unissued shares of the first-mentioned class shall, unless the articles otherwise provide, be increased by the number of shares that, pursuant to subsection (9), became shares of another class or series. Repayment (11) Debt obligations issued, pledged, hypothecated or deposited by a corporation are not redeemed by reason only that the indebtedness evidenced by the debt obligations or in respect of which the debt obligations are issued, pledged, hypothecated or deposited is repaid. Acquisition and reissue of debt obligations (12) Debt obligations issued by a corporation and purchased, redeemed or otherwise acquired by it may be cancelled or, subject to any applicable trust indenture or other agreement, may be reissued, pledged or hypothecated to secure any obligation of the corporation then existing or thereafter incurred, and any such acquisition and reissue, pledge or hypothecation is not a cancellation of the debt obligations. R.S., 1985, c. C-44, s. 39; 1994, c. 24, s. 9(F); 2001, c. 14, s. 24(F); 2011, c. 21, s. 25(F)
Canada Business Corporations Act — C-44 40
Enforcement of contract to buy shares 40 (1) A corporation shall fulfil its obligations under a contract to buy shares of the corporation, except if the corporation can prove that enforcement of the contract would put it in breach of any of sections 34 to 36. Status of contracting party (2) Until the corporation has fulfilled all its obligations under a contract referred to in subsection (1), the other party retains the status of claimant entitled to be paid as soon as the corporation is lawfully able to do so or, in a liquidation, to be ranked subordinate to the rights of creditors and to the rights of holders of any class of shares whose rights were in priority to the rights given to the holders of the class of shares being purchased, but in priority to the rights of other shareholders. R.S., 1985, c. C-44, s. 40; 2001, c. 14, s. 25
Canada Business Corporations Act — C-44 41
Commission for sale of shares 41 The directors may authorize the corporation to pay a reasonable commission to any person in consideration of the person’s purchasing or agreeing to purchase shares of the corporation from the corporation or from any other person, or procuring or agreeing to procure purchasers for any such shares. R.S., 1985, c. C-44, s. 41; 2001, c. 14, s. 135(E)
Canada Business Corporations Act — C-44 42
Dividends 42 A corporation shall not declare or pay a dividend if there are reasonable grounds for believing that (a) the corporation is, or would after the payment be, unable to pay its liabilities as they become due; or (b) the realizable value of the corporation’s assets would thereby be less than the aggregate of its liabilities and stated capital of all classes. 1974-75-76, c. 33, s. 40; 1978-79, c. 9, s. 1(F)
Canada Business Corporations Act — C-44 43
Form of dividend 43 (1) A corporation may pay a dividend by issuing fully paid shares of the corporation and, subject to section 42, a corporation may pay a dividend in money or property. Adjustment of stated capital account (2) If shares of a corporation are issued in payment of a dividend, the declared amount of the dividend stated as an amount of money shall be added to the stated capital account maintained or to be maintained for the shares of the class or series issued in payment of the dividend. 1974-75-76, c. 33, s. 41; 1978-79, c. 9, ss. 1(F), 16
Canada Business Corporations Act — C-44 45
Shareholder immunity 45 (1) The shareholders of a corporation are not, as shareholders, liable for any liability, act or default of the corporation except under subsection 38(4), 118(4) or (5), 146(5) or 226(4) or (5). Lien or hypothec on shares (2) Subject to subsection 49(8), the articles may provide that the corporation has a lien or hypothec on a share registered in the name of a shareholder or the shareholder’s personal representative for a debt of that shareholder to the corporation, including an amount unpaid in respect of a share issued by a body corporate on the date it was continued under this Act. Enforcement of lien or hypothec (3) A corporation may enforce a lien or hypothec referred to in subsection (2) in accordance with its by-laws. R.S., 1985, c. C-44, s. 45; 2001, c. 14, s. 27; 2011, c. 21, s. 26
Canada Business Corporations Act — C-44 46
Sale of constrained shares by corporation 46 (1) A corporation that has constraints on the issue, transfer or ownership of its shares of any class or series may, for any of the purposes referred to in paragraphs (a) to (c), sell, under the conditions and after giving the notice that may be prescribed, as if it were the owner of the shares, any of those constrained shares that are owned, or that the directors determine in the manner that may be prescribed may be owned, contrary to the constraints in order to (a) assist the corporation or any of its affiliates or associates to qualify under any prescribed law of Canada or a province to receive licences, permits, grants, payments or other benefits by reason of attaining or maintaining a specified level of Canadian ownership or control; (b) assist the corporation to comply with any prescribed law; or (c) attain or maintain a level of Canadian ownership specified in its articles. Obligations of directors in sale (2) Where shares are to be sold by a corporation under subsection (1), the directors of the corporation shall select the shares for sale in good faith and in a manner that is not unfairly prejudicial to, and does not unfairly disregard the interests of, the holders of the shares in the constrained class or series taken as a whole. Effect of sale (3) If shares are sold by a corporation under subsection (1), the owner of the shares immediately before the sale shall by that sale be divested of their interest or right in the shares, and the person who, but for the sale, would be the registered owner of the shares or a person who satisfies the corporation that, but for the sale, they could properly be treated as the registered owner or registered holder of the shares under section 51 shall, from the time of the sale, be entitled to receive only the net proceeds of the sale, together with any income earned on the proceeds from the beginning of the month next following the date of the receipt by the corporation of the proceeds of the sale, less any taxes on the proceeds and any costs of administration of a trust fund constituted under subsection 47(1) in relation to the constitution of the fund. Subsections 51(4) to (6) apply (4) Subsections 51(4) to (6) apply in respect of the person who is entitled under subsection (3) to receive the proceeds of a sale of shares under subsection (1) as if the proceeds were a security and the person were a registered holder or owner of the security. R.S., 1985, c. C-44, s. 46; 1991, c. 45, s. 552, c. 47, s. 720; 2001, c. 14, ss. 28, 135(E); 2011, c. 21, s. 27
Canada Business Corporations Act — C-44 47
Proceeds of sale to be trust fund 47 (1) The proceeds of a sale by a corporation under subsection 46(1) constitute a trust fund in the hands of the corporation for the benefit of the person entitled under subsection 46(3) to receive the proceeds of the sale, and any such trust fund may be commingled by the corporation with other such trust funds and shall be invested in such manner as may be prescribed. Costs of administration (2) Reasonable costs of administration of a trust fund referred to in subsection (1) may be deducted from the trust fund and any income earned thereon. Appointment of trust company (3) Subject to this section, a corporation may transfer any trust fund referred to in subsection (1), and the administration thereof, to a trust company in Canada registered as such under the laws of Canada or a province, and the corporation is thereupon discharged of all further liability in respect of the trust fund. Discharge of corporation and trust company (4) A receipt signed by a person entitled under subsection 46(3) to receive the proceeds of a sale that constitute a trust fund under subsection (1) shall be a complete discharge of the corporation and of any trust company to which a trust fund is transferred under subsection (3), in respect of the trust fund and income earned thereon paid to such person. Vesting in Crown (5) A trust fund described in subsection (1), together with any income earned thereon, less any taxes thereon and costs of administration, that has not been claimed by a person entitled under subsection 46(3) to receive the proceeds of a sale that constitute the trust fund for a period of ten years after the date of the sale vests in Her Majesty in right of Canada. Escheats Act applies (6) 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 (5). 1980-81-82-83, c. 115, s. 4
Canada Business Corporations Act — C-44 48
 is in registered form. Order form (5) A debt obligation is in order form where, by its terms, it is payable to the order or assigns of any person therein specified with reasonable certainty or to that person’s order. Bearer form (6) A security is in bearer form if it is payable to bearer according to its terms and not by reason of any endorsement. Guarantor for issuer (7) 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. R.S., 1985, c. C-44, s. 48; 2001, c. 14, ss. 29, 135(E); 2011, c. 21, s. 28