An Act to amend the Canada Business Corporations Act and the Canada Cooperatives Act and to amend other Acts in consequence (S.C. 2001, c. 14)
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Assented to 2001-06-14
R.S., c. C-44; 1994, c. 24, s. 1(F)CANADA BUSINESS CORPORATIONS ACT
Marginal note:1994, c. 24, s. 22; 1998, c. 1, s. 381
92. (1) Subsections 188(1) to (2.1) of the Act are replaced by the following:
Marginal note:Continuance — other jurisdictions
188. (1) Subject to subsection (10), a corporation may apply to the appropriate official or public body of another jurisdiction requesting that the corporation be continued as if it had been incorporated under the laws of that other jurisdiction if the corporation
(a) is authorized by the shareholders in accordance with this section to make the application; and
(b) establishes to the satisfaction of the Director that its proposed continuance in the other jurisdiction will not adversely affect creditors or shareholders of the corporation.
Marginal note:Continuance — other federal Acts
(2) A corporation that is authorized by the shareholders in accordance with this section may apply to the appropriate Minister for its continuance under the Bank Act, the Canada Cooperatives Act, the Insurance Companies Act or the Trust and Loan Companies Act.
(2) Subsection 188(8) of the Act is replaced by the following:
Marginal note:Notice deemed to be articles
(8) For the purposes of section 262, a notice referred to in subsection (7) is deemed to be articles that are in the form that the Director fixes.
93. (1) The portion of subsection 189(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Borrowing powers
189. (1) Unless the articles or by-laws of or a unanimous shareholder agreement relating to a corporation otherwise provide, the directors of a corporation may, without authorization of the shareholders,
(2) Paragraphs 189(1)(b) and (c) of the Act are replaced by the following:
(b) issue, reissue, sell, pledge or hypothecate debt obligations of the corporation;
(c) give a guarantee on behalf of the corporation to secure performance of an obligation of any person; and
94. (1) Paragraph 190(1)(b) of the French version of the Act is replaced by the following:
b) de modifier ses statuts, conformément à l’article 173, afin d’ajouter, de modifier ou de supprimer toute restriction à ses activités commerciales;
(2) Subsection 190(1) of the Act is amended by striking out the word “or” at the end of paragraph (d), by adding the word “or” at the end of paragraph (e) and by adding the following after paragraph (e):
(f) carry out a going-private transaction or a squeeze-out transaction.
(3) Section 190 of the Act is amended by adding the following after subsection (2):
Marginal note:If one class of shares
(2.1) The right to dissent described in subsection (2) applies even if there is only one class of shares.
95. Subsection 191(4) of the Act is replaced by the following:
Marginal note:Articles of reorganization
(4) After an order referred to in subsection (1) has been made, articles of reorganization in the form that the Director fixes shall be sent to the Director together with the documents required by sections 19 and 113, if applicable.
96. (1) Paragraph 192(1)(f) of the Act is replaced by the following:
(f) an exchange of securities of a corporation for property, money or other securities of the corporation or property, money or securities of another body corporate;
(f.1) a going-private transaction or a squeeze-out transaction in relation to a corporation;
(2) Subsection 192(3) of the French version of the Act is replaced by the following:
Marginal note:Demande d’approbation au tribunal
(3) Lorsqu’il est pratiquement impossible pour la société qui n’est pas insolvable d’opérer, en vertu d’une autre disposition de la présente loi, une modification de structure équivalente à un arrangement, elle peut demander au tribunal d’approuver, par ordonnance, l’arrangement qu’elle propose.
(3) Subsection 192(6) of the Act is replaced by the following:
Marginal note:Articles of arrangement
(6) After an order referred to in paragraph (4)(e) has been made, articles of arrangement in the form that the Director fixes shall be sent to the Director together with the documents required by sections 19 and 113, if applicable.
97. The heading before section 193 and sections 193 to 205 of the Act are replaced by the following:
GOING-PRIVATE TRANSACTIONS AND SQUEEZE-OUT TRANSACTIONS
Marginal note:Going-private transactions
193. A corporation may carry out a going-private transaction. However, if there are any applicable provincial securities laws, a corporation may not carry out a going-private transaction unless the corporation complies with those laws.
Marginal note:Squeeze-out transactions
194. A corporation may not carry out a squeeze-out transaction unless, in addition to any approval by holders of shares required by or under this Act or the articles of the corporation, the transaction is approved by ordinary resolution of the holders of each class of shares that are affected by the transaction, voting separately, whether or not the shares otherwise carry the right to vote. However, the following do not have the right to vote on the resolution:
(a) affiliates of the corporation; and
(b) holders of shares that would, following the squeeze-out transaction, be entitled to consideration of greater value or to superior rights or privileges than those available to other holders of shares of the same class.
98. The Act is amended by adding the following before section 206:
PART XVIICOMPULSORY AND COMPELLED ACQUISITIONS
99. (1) The portion of subsection 206(1) of the Act before the definition “dissenting offeree” is replaced by the following:
Marginal note:Definitions
206. (1) The definitions in this subsection apply in this Part.
(2) The definition “take-over bid” in subsection 206(1) of the Act is replaced by the following:
“take-over bid”
« offre d’achat visant à la mainmise »
“take-over bid” means an offer made by an offeror to shareholders of a distributing corporation at approximately the same time to acquire all of the shares of a class of issued shares, and includes an offer made by a distributing corporation to repurchase all of the shares of a class of its shares.
(3) Subsection 206(1) of the Act is amended by adding the following in alphabetical order:
“offer”
« pollicitation »
“offer” includes an invitation to make an offer.
“offeree”
« pollicité »
“offeree” means a person to whom a take-over bid is made.
“offeree corporation”
« société pollicitée »
“offeree corporation” means a distributing corporation whose shares are the object of a take-over bid.
“offeror”
« pollicitant »
“offeror” means a person, other than an agent, who makes a take-over bid, and includes two or more persons who, directly or indirectly,
(a) make take-over bids jointly or in concert; or
(b) intend to exercise jointly or in concert voting rights attached to shares for which a take-over bid is made.
“share”
« action »
“share” means a share, with or without voting rights, and includes
(a) a security currently convertible into such a share; and
(b) currently exercisable options and rights to acquire such a share or such a convertible security.
(4) Paragraph 206(3)(a) of the Act is replaced by the following:
(a) the offerees holding not less than ninety per cent of the shares to which the bid relates accepted the take-over bid;
(5) Paragraph 206(3)(d) of the Act is replaced by the following:
(d) a dissenting offeree who does not notify the offeror in accordance with subparagraph (5)(b)(ii) is deemed to have elected to transfer the shares to the offeror on the same terms that the offeror acquired the shares from the offerees who accepted the take-over bid; and
(6) Subsections 206(5) and (6) of the Act are replaced by the following:
Marginal note:Share certificate
(5) A dissenting offeree to whom an offeror’s notice is sent under subsection (3) shall, within twenty days after receiving the notice,
(a) send the share certificates of the class of shares to which the take-over bid relates to the offeree corporation; and
(b) elect
(i) to transfer the shares to the offeror on the terms on which the offeror acquired the shares of the offerees who accepted the take-over bid, or
(ii) to demand payment of the fair value of the shares in accordance with subsections (9) to (18) by notifying the offeror within those twenty days.
Marginal note:Deemed election
(5.1) A dissenting offeree who does not notify the offeror in accordance with subparagraph (5)(b)(ii) is deemed to have elected to transfer the shares to the offeror on the same terms on which the offeror acquired the shares from the offerees who accepted the take-over bid.
Marginal note:Payment
(6) Within twenty days after the offeror sends an offeror’s notice under subsection (3), the offeror shall pay or transfer to the offeree corporation the amount of money or other consideration that the offeror would have had to pay or transfer to a dissenting offeree if the dissenting offeree had elected to accept the take-over bid under subparagraph (5)(b)(i).
(7) Section 206 of the Act is amended by adding the following after subsection (7):
Marginal note:When corporation is offeror
(7.1) A corporation that is an offeror making a take-over bid to repurchase all of the shares of a class of its shares is deemed to hold in trust for the dissenting shareholders the money and other consideration that it would have had to pay or transfer to a dissenting offeree if the dissenting offeree had elected to accept the take-over bid under subparagraph (5)(b)(i), and the corporation shall, within twenty days after a notice is sent under subsection (3), deposit the money in a separate account in a bank or other body corporate any of whose deposits are insured by the Canada Deposit Insurance Corporation or guaranteed by the Quebec Deposit Insurance Board, and shall place the other consideration in the custody of a bank or such other body corporate.
(8) Subsections 206(8) and (9) of the Act are replaced by the following:
Marginal note:Duty of offeree corporation
(8) Within thirty days after the offeror sends a notice under subsection (3), the offeree corporation shall
(a) if the payment or transfer required by subsection (6) is made, issue to the offeror a share certificate in respect of the shares that were held by dissenting offerees;
(b) give to each dissenting offeree who elects to accept the take-over bid terms under subparagraph (5)(b)(i) and who sends share certificates as required by paragraph (5)(a) the money or other consideration to which the offeree is entitled, disregarding fractional shares, which may be paid for in money; and
(c) if the payment or transfer required by subsection (6) is made and the money or other consideration is deposited as required by subsection (7) or (7.1), send to each dissenting shareholder who has not sent share certificates as required by paragraph (5)(a) a notice stating that
(i) the dissenting shareholder’s shares have been cancelled,
(ii) the offeree corporation or some designated person holds in trust for the dissenting shareholder the money or other consideration to which that shareholder is entitled as payment for or in exchange for the shares, and
(iii) the offeree corporation will, subject to subsections (9) to (18), send that money or other consideration to that shareholder without delay after receiving the shares.
Marginal note:Application to court
(9) If a dissenting offeree has elected to demand payment of the fair value of the shares under subparagraph (5)(b)(ii), the offeror may, within twenty days after it has paid the money or transferred the other consideration under subsection (6), apply to a court to fix the fair value of the shares of that dissenting offeree.
(9) Subsection 206(13) of the French version of the Act is replaced by the following:
Marginal note:Absence de cautionnement pour frais
(13) Dans le cadre d’une demande visée aux paragraphes (9) ou (10), les pollicités dissidents ne sont pas tenus de fournir de cautionnement pour les frais.
(10) Paragraph 206(14)(a) of the Act is replaced by the following:
(a) all dissenting offerees referred to in subparagraph (5)(b)(ii) whose shares have not been acquired by the offeror shall be joined as parties and are bound by the decision of the court; and
(11) Paragraph 206(18)(a) of the Act is replaced by the following:
(a) fix the amount of money or other consideration that is required to be held in trust under subsection (7) or (7.1);
100. The Act is amended by adding the following after section 206:
Marginal note:Obligation to acquire shares
206.1 (1) If a shareholder holding shares of a distributing corporation does not receive an offeror’s notice under subsection 206(3), the shareholder may
(a) within ninety days after the date of termination 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 termination 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:Conditions
(2) If a shareholder requires the offeror to acquire shares under subsection (1), the offeror shall 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.
Marginal note:1992, c. 27, par. 90(1)(h)
101. (1) Subsection 208(1) of the Act is replaced by the following:
Marginal note:Application of Part
208. (1) This Part, other than sections 209 and 212, does not apply to a corporation that is an insolvent person or a bankrupt as those terms are defined in subsection 2(1) of the Bankruptcy and Insolvency Act.
Marginal note:1992, c. 27, par. 90(1)(h)
(2) Subsection 208(2) of the English version of the Act is replaced by the following:
Marginal note:Staying proceedings
(2) Any proceedings taken under this Part to dissolve or to liquidate and dissolve a corporation shall be stayed if the corporation is at any time found, in a proceeding under the Bankruptcy and Insolvency Act, to be an insolvent person as defined in subsection 2(1) of that Act.
102. Subsections 209(2) to (4) of the Act are replaced by the following:
Marginal note:Articles of revival
(2) Articles of revival in the form that the Director fixes shall be sent to the Director.
Marginal note:Certificate of revival
(3) On receipt of articles of revival, the Director shall issue a certificate of revival in accordance with section 262, if
(a) the body corporate has fulfilled all conditions precedent that the Director considers reasonable; and
(b) there is no valid reason for refusing to issue the certificate.
Marginal note:Date of revival
(3.1) A body corporate is revived as a corporation under this Act on the date shown on the certificate of revival.
Marginal note:Rights preserved
(4) Subject to any reasonable terms that may be imposed by the Director, to the rights acquired by any person after its dissolution and to any changes to the internal affairs of the corporation after its dissolution, the revived corporation is, in the same manner and to the same extent as if it had not been dissolved,
(a) restored to its previous position in law, including the restoration of any rights and privileges whether arising before its dissolution or after its dissolution and before its revival; and
(b) liable for the obligations that it would have had if it had not been dissolved whether they arise before its dissolution or after its dissolution and before its revival.
Marginal note:Legal actions
(5) Any legal action respecting the affairs of a revived corporation taken between the time of its dissolution and its revival is valid and effective.
Definition of “interested person”
(6) In this section, “interested person” includes
(a) a shareholder, a director, an officer, an employee and a creditor of the dissolved corporation;
(b) a person who has a contractual relationship with the dissolved corporation;
(c) a person who, although at the time of dissolution of the corporation was not a person described in paragraph (a), would be such a person if a certificate of revival is issued under this section; and
(d) a trustee in bankruptcy for the dissolved corporation.
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