PART 12Security Certificates, Registers and Transfers (continued)
245 An authenticating trustee, transfer agent or other agent or mandatary of an issuer has, in respect of the issue, registration of transfer and cancellation of a security of the issuer,
(a) a duty to the issuer to exercise good faith and reasonable diligence; and
(b) the same obligations to the holder or owner of a security and the same rights, privileges and immunities as the issuer.
- 1998, c. 1, s. 245
- 2011, c. 21, s. 98(F)
Marginal note:Notice to agent or mandatary
246 Notice to an authenticating trustee, transfer agent or other agent or mandatary of an issuer is notice to the issuer in respect of the functions performed by the agent or mandatary.
PART 13Financial Disclosure
Marginal note:Annual financial statements to members
247 (1) The directors must place before the members at every annual meeting of members
(a) prescribed comparative financial statements that conform to any prescribed requirements and relate separately to
(i) the period that began on the date the cooperative came into existence and ended not more than six months before the annual meeting or, if the cooperative has completed a financial year, the period that began immediately after the end of the last completed financial year and ended not more than six months before the annual meeting, and
(ii) the immediately preceding financial year;
(b) the report of the auditor, if any; and
(c) any further information respecting the financial position of the cooperative and the results of its operations required by the articles, the by-laws or a unanimous agreement.
Marginal note:Annual financial statements to shareholders
(2) If shareholders have a right to have an annual meeting under subsection 133(1), the directors must place the documents described in subsection (1) before the shareholders at every annual meeting of shareholders.
(3) Despite paragraph (1)(a) and subsection (2), the financial statements referred to in subparagraph (1)(a)(ii) may be omitted if the reason for the omission is set out in the financial statements, or in a note to those statements, to be placed before the members at an annual meeting of members and, in a case to which subsection (2) applies, the shareholders at an annual meeting of shareholders.
- 1998, c. 1, s. 247
- 2018, c. 8, s. 69
Marginal note:Application for exemption
248 On the application of a cooperative, the Director may exempt the cooperative, on any terms that the Director thinks fit, from any requirement set out in section 247 or any of sections 249 to 252, if the Director reasonably believes that the detriment that may be caused to the cooperative by the requirement outweighs its benefit to the members and shareholders or, in the case of a distributing cooperative, to the public.
- 1998, c. 1, s. 248
- 2018, c. 8, s. 70
Marginal note:Consolidated statements
249 (1) A cooperative must keep at its registered office a copy of the financial statements of each of its subsidiaries and of each entity the accounts of which are consolidated in its financial statements.
(2) The members and shareholders of a cooperative and their personal representatives may on request examine the statements referred to in subsection (1) during the usual business hours of the cooperative and may take extracts from them free of charge.
Marginal note:Barring examination
(3) A cooperative may, not later than fifteen days after a request to examine under subsection (2), apply to a court for an order barring the right of any person to so examine, and the court may, if it is satisfied that the examination would be detrimental to the cooperative or a subsidiary, bar the right and make any further order it thinks fit.
(4) A cooperative must give the person requesting to examine under subsection (2) notice of an application under subsection (3), and the person may appear and be heard in person or by counsel.
- 1998, c. 1, s. 249
- 2001, c. 14, s. 200
Marginal note:Approval of financial statements
250 (1) The directors must approve the financial statements referred to in section 247 and the approval is evidenced by the manual signature of one or more directors, or a facsimile of the signatures reproduced on the statements.
Marginal note:Condition precedent
(2) A cooperative may not issue, publish or circulate copies of the financial statements referred to in section 247 unless they are
(a) approved and signed in accordance with subsection (1); and
(b) accompanied by the report of the auditor of the cooperative, if any.
Marginal note:Copies to shareholders
251 A cooperative shall send a copy of the documents referred to in section 247 to each member and shareholder, except to a member or shareholder who has informed the cooperative in writing that they do not want a copy of the documents,
(a) not less than twenty-one days before each annual meeting of members;
(b) not less than twenty-one days before each annual meeting of shareholders, if subsection 247(2) applies; or
(c) not later than a resolution in lieu of an annual meeting is signed under section 66.
Marginal note:Copies to Director
252 (1) A distributing cooperative, any of the issued securities of which remain outstanding and are held by more than one person, must send a copy of the documents referred to in section 247 to the Director
(a) not less than twenty-one days before each annual meeting of members or, without delay after a resolution referred to in paragraph 251(c) is signed; and
(b) in any event within fifteen months after the last preceding annual meeting of shareholders was held or the resolution referred to in paragraph 251(c) was signed, but no later than six months after the end of the cooperative’s preceding financial year.
Marginal note:Subsidiary cooperative
(2) A subsidiary cooperative is not required to comply with this section if its financial statements are consolidated or combined with those of its holding cooperative entity and the statements of its holding cooperative entity are sent to the Director in compliance with this section.
- 1998, c. 1, s. 252
- 2001, c. 14, s. 201
Marginal note:Qualifications of auditor
253 (1) Subject to subsection (5), a person is disqualified from being an auditor of a cooperative if the person is not independent of the cooperative, of any of its affiliates or of the directors or officers of the cooperative or its affiliates.
(2) For the purposes of this section,
(a) independence is a question of fact; and
(b) a person is deemed not to be independent if the person, or another person with whom the person is in business,
(i) is a director, officer or employee of the cooperative or any of its affiliates, is in business with the cooperative or any of its affiliates, or is in business with a director, officer or employee of the cooperative or any of its affiliates,
(ii) beneficially owns or controls, directly or indirectly, a material interest in the securities of the cooperative or any of its affiliates, or
(iii) has been a receiver, receiver-manager, sequestrator, liquidator or trustee in bankruptcy of the cooperative or any of its affiliates within two years of the proposed appointment of the person as auditor of the cooperative.
Marginal note:Duty to resign
(3) An auditor who becomes disqualified under this section must, subject to subsection (5), resign without delay after becoming aware of the disqualification.
Marginal note:Disqualification order
(4) Any interested person may apply to a court for an order declaring an auditor to be disqualified under this section and the office of auditor to be vacant.
Marginal note:Exemption order
(5) Any interested person may apply to a court for an order exempting an auditor from disqualification under this section and the court may, if it is satisfied that an exemption would not unfairly prejudice the members or shareholders, make an exemption order on any terms that it thinks fit. The order may have retrospective effect.
- 1998, c. 1, s. 253
- 2011, c. 21, s. 99(E)
Marginal note:Appointment of auditor
254 (1) Subject to section 255, the members must, by ordinary resolution, at the first annual meeting of members and at each subsequent annual meeting, appoint an auditor to hold office until the close of the next annual meeting.
(2) An auditor appointed under section 82 is eligible for appointment under subsection (1).
Marginal note:Incumbent auditor
(3) Despite subsection (1), if an auditor is not appointed at a meeting of members, the incumbent auditor continues in office until a successor is appointed.
(4) The remuneration of an auditor may be fixed by ordinary resolution of the members or, if not so fixed, may be fixed by the directors.
Marginal note:Dispensing with auditor
255 (1) A cooperative that is not a distributing cooperative may resolve not to appoint an auditor by
(a) special resolution of the members; and
(b) special resolution of all shareholders, including those who do not otherwise have the right to vote.
(2) A resolution under subsection (1) is valid only until the next annual meeting of members.
- 1998, c. 1, s. 255
- 2001, c. 14, s. 202
Marginal note:Ceasing to hold office
256 (1) An auditor of a cooperative ceases to hold office when the auditor dies, resigns or is removed under section 257.
Marginal note:Effective date of resignation
(2) A resignation of an auditor becomes effective on the date on which a written resignation is sent to the cooperative, or on the date specified in the resignation, whichever is later.
Marginal note:Removal of auditor
257 (1) The members may by ordinary resolution at a special meeting remove the auditor from office, unless the auditor was appointed by a court under section 259.
(2) A vacancy created by the removal of an auditor may be filled at the meeting at which the auditor is removed or, if not so filled, may be filled under section 258.
Marginal note:Filling vacancy
258 (1) Subject to subsection (3), the directors must fill a vacancy in the office of auditor without delay after it occurs.
Marginal note:Calling meeting
(2) If there is not a quorum of directors, the directors then in office must, not later than twenty-one days after a vacancy in the office of auditor occurs, call a special meeting of members to fill the vacancy and, if they fail to call a meeting or if there are no directors, the meeting may be called by any member.
Marginal note:Members filling vacancy
(3) The by-laws of a cooperative may provide that a vacancy in the office of auditor may only be filled by vote of the members.
Marginal note:Unexpired term
(4) An auditor appointed to fill a vacancy holds office for the unexpired term of their predecessor.
Marginal note:Court appointed auditor
259 (1) If a cooperative does not have an auditor, the court may, on the application of a member or shareholder, appoint and fix the remuneration of an auditor who holds office until an auditor is appointed by the members.
(2) Subsection (1) does not apply if a resolution made under section 255 not to appoint an auditor is in effect.
Marginal note:Right to attend meeting
260 (1) The auditor of a cooperative is entitled to receive notice of every meeting of the cooperative and, at the expense of the cooperative, to attend and be heard at the meetings on matters relating to the auditor’s duties.
Marginal note:Duty to attend
(2) If a director or member of a cooperative, whether or not the member is entitled to vote at the meeting, or a shareholder that is entitled to vote at that meeting of shareholders, gives written notice not less than ten days before a meeting of the cooperative to the auditor or a former auditor of the cooperative, the auditor or former auditor shall attend the meeting at the expense of the cooperative and answer questions relating to the auditor’s duties.
Marginal note:Notice to cooperative
(3) A director, member or shareholder who sends a notice referred to in subsection (2) must send a copy of the notice to the cooperative at the same time.
Marginal note:Statement of auditor
(4) An auditor is entitled to submit to the cooperative a written statement giving the reasons for the auditor’s resignation or the reasons why the auditor opposes a proposed action or resolution set out in any of paragraphs (a) to (d), in any of the following situations:
(a) the auditor resigns;
(b) the auditor receives a notice or otherwise learns of a meeting of members called for the purpose of removing the auditor from office;
(c) the auditor receives a notice or otherwise learns of a meeting of directors or members at which another person is to be appointed to fill the office of auditor, whether because of the resignation or removal of the incumbent auditor or because the term of office of the incumbent auditor has expired or is about to expire; or
(d) the auditor receives a notice or otherwise learns of a meeting at which a resolution referred to in section 255 is to be proposed.
Marginal note:Other statements
(5) In the case of a proposed replacement of an auditor, whether through removal or at the end of the auditor’s term, the following rules apply with respect to other statements:
(a) the cooperative must make a statement on the reasons for the proposed replacement; and
(b) the proposed replacement auditor may make a statement in which he or she comments on the reasons referred to in paragraph (a).
Marginal note:Circulating statement
(6) The cooperative must send a copy of the statements referred to in subsections (4) and (5) without delay to every person who is entitled to receive notice of a meeting referred to subsection (1) and to the Director.
Marginal note:Replacing auditor
(7) No person may accept appointment or consent to be appointed as auditor of a cooperative if the person is replacing an auditor who has resigned or been removed or whose term of office has expired or is about to expire until the person has requested and received from that auditor a written statement of the circumstances and the reasons why, in that auditor’s opinion, the auditor is to be replaced.
(8) Despite subsection (7), a person otherwise qualified may accept appointment or consent to be appointed as auditor of a cooperative if, no later than fifteen days after making the request referred to in that subsection, the person does not receive a reply.
Marginal note:Effect of non-compliance
(9) Unless subsection (8) applies, an appointment as auditor of a cooperative of a person who has not complied with subsection (7) is null or void.
- 1998, c. 1, s. 260
- 2001, c. 14, s. 203(F)
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