Cancellation of shares held in contravention of Act
14. (1) Where any equity shares of the Corporation are held in contravention of this Act, the Corporation may, upon such notice to the holder thereof in such manner as may be prescribed by the by-laws, require such equity shares to be disposed of to a person or corporation who may be eligible to hold equity shares of the Corporation, within such period of time, not being less than sixty days nor more than 180 days or such longer period of time as may be approved by special resolution of the Corporation, as may be stipulated in the notice. Idem (2) Where the equity shares referred to in a notice given under subsection (1) have not been disposed of within the stipulated time, the Corporation may, at any time while the equity shares continue to be held in contravention of this Act, decrease its authorized and issued capital by cancelling the equity shares and the decrease is effective upon, (a) the deposit by the Corporation of the amount of the capital repayment payable with respect to the equity shares in a special account with a bank listed in Schedule I or II to the Bank Act (Canada) or trust corporation; and (b) the giving by the Corporation of notice of cancellation to the holders of the equity shares in such manner as may be prescribed by the by-laws, including notice of the deposit referred to in clause (a), and thereupon the equity shares are cancelled and the rights of the holder and of any beneficial owners of the equity shares are terminated except for the right of the holder thereof to receive out of the amount so deposited, without interest, the capital repayment payable with respect thereto upon presentation and surrender of the certificates representing the said equity shares, and any interest payable on the deposit shall be paid to the Corporation. Application of money (3) The Corporation is not bound to see to the application of the amount deposited or to the execution of any trust, whether express, implied or constructive, in respect of any equity shares cancelled under this section and the Corporation is not estopped by any certificates outstanding in respect of any equity shares cancelled. Repayment of money (4) In determining as at any particular time the capital repayment to be made on equity shares of the Corporation for the purpose of this section, the capital repayment shall be, (a) in the case of a share with a par value, an amount equal to the par value thereof; and (b) in the case of a share without par value, an amount equal to the per share amount of the issued capital of the Corporation with respect to the class of shares in question determined in accordance with the provisions of subsection 24(2) of the Business Corporations Act as at the day before the day the deposit referred to in clause (2)(a) is made, provided that if the class of shares in question is listed on a stock exchange, the capital repayment shall be an amount equal to the lesser of, (i) the per share amount of the issued capital of the Corporation with respect to the class of shares in question determined in accordance with the provisions of subsection 24(2) of the Business Corporations Act as at the day before the day the deposit referred to in clause (2)(a) is made, and (ii) the last sale price per share of the class of shares in question on the stock exchanges on which such shares are listed on the last business day before the day the deposit referred to in clause (2)(a) is made. Filing of notice (5) Where equity shares of the Corporation are cancelled under this section, the Corporation shall within thirty days of the date on which the cancellation is effected, file with the Minister of Consumer and Commercial Relations, a notice setting out the number of shares of the class cancelled and the date on which the cancellation was effected. Idem (6) Failure to comply with subsection (5) does not invalidate the decrease in the authorized and issued capital of the Corporation. Non-application of s. 8 (7) Section 8 does not apply to any decrease of the authorized and issued capital of the Corporation pursuant to this section. R.S.O. 1990, c. O.14, s. 14.