Canada Business Corporations Act (R.S.C., 1985, c. C-44)

Marginal note:Rights of holder

• 49 (1) Every security holder is entitled at their option to a security certificate that complies with this Act or a non-transferable written acknowledgment of their right to obtain such a security certificate from a corporation in respect of the securities of that corporation held by them.

• Marginal note:Maximum fee for certificate by regulation

  (2) A corporation may charge a fee, not exceeding the prescribed amount, for a security certificate issued in respect of a transfer.

• Marginal note:Joint holders

  (3) A corporation is not required to issue more than one security certificate in respect of securities held jointly by several persons, and delivery of a certificate to one of several joint holders is sufficient delivery to all.

• Marginal note:Signatures

  (4) A security certificate shall be signed by at least one of the following persons, or the signature shall be printed or otherwise mechanically reproduced on the certificate:

  • (a) a director or officer of the corporation;

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

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

• (5) [Repealed, 2001, c. 14, s. 30]

• Marginal note:Continuation of signature

  (6) If a security certificate contains a printed or mechanically reproduced signature of a person, the corporation may issue the security certificate, notwithstanding that the person has ceased to be a director or an officer of the corporation, and the security certificate is as valid as if the person were a director or an officer at the date of its issue.

• Marginal note:Contents of share certificate

  (7) There shall be stated on the face of each share certificate issued by a corporation

  • (a) the name of the corporation;

  • (b) the words “Incorporated under the Canada Business Corporations Act” or “subject to the Canada Business Corporations Act”;

  • (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:Restrictions

  (8) No restriction, charge, lien, hypothec, agreement or endorsement described in the following paragraphs is effective against a transferee of a security, issued by a corporation or by a body corporate before the body corporate was 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:

  • (a) a restriction on transfer other than a constraint under section 174;

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

  • (c) a unanimous shareholder agreement; or

  • (d) an endorsement under subsection 190(10).

• Marginal note:Limit on restriction

  (9) A distributing corporation, any of the issued shares of which remain outstanding and are held by more than one person, shall not have a restriction on the transfer or ownership of its shares of any class or series except by way of a constraint permitted under section 174.

• Marginal note:Notation of constraint

  (10) Where the articles of a corporation constrain the issue, transfer or ownership of shares of any class or series in order to assist

  • (a) 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, or

  • (b) the corporation to comply with any prescribed law,

  the constraint, or a reference to it, shall be conspicuously noted on every security certificate of the corporation evidencing a share that is subject to the constraint where the security certificate is issued after the day on which the share becomes subject to the constraint under this Act.

• Marginal note:Failure to note

  (11) The failure to note a constraint or a reference to it pursuant to subsection (10) shall not invalidate any share or security certificate and shall not render a constraint ineffective against an owner, holder or transferee of the share or security certificate.

• Marginal note:Transitional

  (12) If a body corporate continued under this Act has outstanding security certificates, and if the words “private company” appear on the certificates, those words are deemed to be a notice of a restriction, lien, hypothec, agreement or endorsement for the purpose of subsection (8).

• Marginal note:Particulars of class

  (13) There shall be stated legibly on a share certificate issued by a corporation that is authorized to issue shares of more than one class or series

  • (a) the rights, privileges, restrictions and conditions attached to the shares of each class and series that exists 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 thereto and that the corporation will furnish a shareholder, on demand and without charge, with a full copy of the text of

    • (i) the rights, privileges, restrictions and conditions attached to each class authorized to be issued and to each series in so far as the same 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:Duty

  (14) Where a share certificate issued by a corporation contains the statement mentioned in paragraph (13)(b), the corporation shall furnish a shareholder, on demand and without charge, with a full copy of the text of

  • (a) the rights, privileges, restrictions and conditions attached to each class authorized to be issued and to each series in so far as the same have been fixed by the directors; and

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

• Marginal note:Fractional share

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

• Marginal note:Replacement

  (15.1) On the request of a holder of a certificate for a fractional share or of a scrip certificate, a corporation shall, if the certificate is in bearer form and was issued before the coming into force of this subsection, issue in exchange to that holder, in registered form, a certificate for a fractional share or a scrip certificate, as the case may be.

• Marginal note:Scrip certificates

  (16) The directors may attach conditions to any scrip certificates issued by a corporation, including conditions that

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

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

• Marginal note:Holder of fractional share

  (17) A holder of a fractional share issued by a corporation is not entitled to exercise voting rights or to receive a dividend in respect of the fractional share, unless

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

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

• Marginal note:Holder of scrip certificate

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