Cooperative Credit Associations Act (S.C. 1991, c. 48)

Marginal note:Directors’ and officers’ insurance

217 An association may purchase and maintain insurance for the benefit of any person referred to in section 216 against any liability incurred by the person

• (a) in the capacity of a director or an officer of the association, except where the liability relates to a failure to act honestly and in good faith with a view to the best interests of the association; or

• (b) in the capacity of a director or officer of another entity or while acting in a similar capacity for another entity, if they act or acted in that capacity at the association’s request, except if the liability relates to a failure to act honestly and in good faith with a view to the best interests of the entity.

Marginal note:Application to court for indemnification

• 218 (1) An association or a person referred to in section 216 may apply to a court for an order approving an indemnity under that section and the court may so order and make any further order it thinks fit.

• Marginal note:Notice to Superintendent

  (2) An applicant under subsection (1) shall give the Superintendent written notice of the application and the Superintendent is entitled to appear and to be heard at the hearing of the application in person or by counsel.

• Marginal note:Other notice

  (3) On an application under subsection (1), the court may order notice to be given to any interested person and that person is entitled to appear and to be heard in person or by counsel at the hearing of the application.

Fundamental Changes

Amendments

Marginal note:Incorporating instrument

219 On the application of an association duly authorized by special resolution of the members, the Minister may approve a proposal to add, change or remove any provision that is permitted by this Act to be set out in the association’s incorporating instrument.

Marginal note:Letters patent to amend

• 220 (1) On receipt of an application referred to in section 219, the Minister may issue letters patent to effect the proposal.

• Marginal note:Effect of letters patent

  (2) Letters patent issued pursuant to subsection (1) become effective on the day stated in the letters patent.

Marginal note:By-laws

• 221 (1) The members of an association may, by special resolution, make, amend or repeal any by-laws, in the manner set out in subsection (2) and sections 222 to 225, to

  • (a) change the maximum number, if any, of shares of any class that the association is authorized to issue;

  • (b) create new classes of shares;

  • (c) change the designation of any or all of the association’s shares, and add, change or remove any rights, privileges, restrictions and conditions, including rights to accrued dividends, in respect of any or all of the association’s shares, whether issued or unissued;

  • (d) change the shares of any class or series, whether issued or unissued, into a different number of shares of the same class or series or into the same or a different number of shares of other classes or series;

  • (e) divide a class of shares, whether issued or unissued, into series and fix the maximum number of shares, if any, in each series and the rights, privileges, restrictions and conditions attached thereto;

  • (f) authorize the directors to divide any class of unissued shares into series and fix the maximum number of shares, if any, in each series and the rights, privileges, restrictions and conditions attached thereto;

  • (g) authorize the directors to change the rights, privileges, restrictions and conditions attached to unissued shares of any series;

  • (h) revoke, diminish or enlarge any authority conferred under paragraphs (f) and (g);

  • (i) increase or decrease the number of directors or the minimum or maximum number of directors, subject to subsection 169(1);

  • (i.1) change the name of the association; or

  • (j) change the province in which the head office of the association is situated.

• Marginal note:Effective date of by-law

  (2) A by-law respecting a change to the name of the association is not effective until it is approved by the Superintendent.

• Marginal note:Letters patent

  (3) If the name of an association or the province in Canada in which the head office of the association is situated is changed under this section, the Superintendent may issue letters patent to amend the association’s incorporating instrument accordingly.

• Marginal note:Effect of letters patent

  (4) Letters patent issued under subsection (3) become effective on the day stated in the letters patent.

Marginal note:Class vote

• 222 (1) The holders of shares of a class or, subject to subsection (2), of a series are, unless the by-laws otherwise provide in the case of an amendment to the by-laws referred to in paragraph (a), (b) or (e), entitled to vote separately as a class or series on a proposal to amend the by-laws to

  • (a) increase or decrease any maximum number of authorized shares of that class, or increase any maximum number of authorized shares of a class having rights or privileges equal or superior to the shares of that class;

  • (b) effect an exchange, reclassification or cancellation of all or part of the shares of a class;

  • (c) add, change or remove the rights, privileges, restrictions or conditions attached to the shares of a class and, without limiting the generality of the foregoing,

    • (i) remove or change prejudicially rights to accrued dividends or rights to cumulative dividends,

    • (ii) add, remove or change prejudicially redemption rights,

    • (iii) reduce or remove a dividend preference or a liquidation preference, or

    • (iv) add, remove or change prejudicially conversion privileges, options, voting, transfer or pre-emptive rights, or rights to acquire securities of the association, or sinking fund provisions;

  • (d) increase the rights or privileges of any class of shares having rights or privileges equal or superior to the shares of that class;

  • (e) create a new class of shares equal or superior to the shares of that class;

  • (f) make any class of shares having rights or privileges inferior to the shares of that class equal or superior to the shares of that class; or

  • (g) effect an exchange or create a right of exchange of all or part of the shares of another class into the shares of that class.

• Marginal note:Right limited

  (2) The holders of a series of shares of a class are entitled to vote separately as a series under subsection (1) if that series is affected by an addition or amendment to the by-laws in a manner different from other shares of the same class.

• Marginal note:Right to vote

  (3) Subsections (1) and (2) apply whether or not the shares of a class otherwise carry the right to vote.

Marginal note:Separate resolutions

223 A proposed addition or amendment to the by-laws referred to in subsection 222(1) is adopted when the holders of the shares of each class or series entitled to vote separately thereon as a class or series have approved the addition or amendment by a special resolution.

Marginal note:Proposal to amend

• 224 (1) Subject to subsection (2), a member may, in accordance with sections 152 and 153, make a proposal to make an application referred to in section 219 or to make, amend or repeal the by-laws referred to in subsection 221(1) of the association.

• Marginal note:Notice of amendment

  (2) Notice of a meeting at which a proposal to amend the incorporating instrument or to make, amend or repeal the by-laws of an association is to be considered must set out the proposal.

Marginal note:Rights preserved

225 No amendment to the incorporating instrument or by-laws of an association affects an existing cause of action or claim or liability to prosecution in favour of or against the association or its directors or officers, or any civil, criminal or administrative action or proceeding to which the association or any of its directors or officers are a party.

Amalgamation

Marginal note:Application to amalgamate

226 On the joint application of two or more bodies corporate incorporated by or under an Act of Parliament, including associations, the Minister may issue letters patent amalgamating and continuing the applicants as one association if the proposed capital and corporate structure of the amalgamated association meets the requirements for an association to be incorporated under this Act.

Marginal note:Amalgamation agreement

• 227 (1) Each applicant proposing to amalgamate shall enter into an amalgamation agreement.

• Marginal note:Contents of agreement

  (2) Every amalgamation agreement shall set out the terms and means of effecting the amalgamation and, in particular,

  • (a) the name of the amalgamated association and the province in which its head office is to be situated;

  • (b) the name and place of ordinary residence of each proposed director of the amalgamated association;

  • (c) the manner in which the membership shares of each association are to be converted into membership shares in the amalgamated association;

  • (d) the manner in which the shares of each applicant are to be converted into shares or other securities of the amalgamated association;

  • (e) if any membership shares of an applicant are not to be converted into membership shares of the amalgamated association the amount of money or securities that the members are to receive in addition to or in lieu of membership shares of the amalgamated association;

  • (f) if any shares of an applicant are not to be converted into shares or other securities of the amalgamated association, the amount of money or securities that the holders of those shares are to receive in addition to or in lieu of shares or other securities of the amalgamated association;

  • (g) the manner of payment of money in lieu of the issue of fractional shares of the amalgamated association or of any other body corporate that are to be issued in the amalgamation;

  • (h) the proposed by-laws of the amalgamated association;

  • (i) details of any other matter necessary to perfect the amalgamation and to provide for the subsequent management and operation of the amalgamated association; and

  • (j) the proposed effective date of the amalgamation.

• Marginal note:Cross ownership of shares

  (3) If membership shares or shares of one of the applicants are held by or on behalf of another of the applicants, other than membership shares or shares held in the capacity of a personal representative or by way of security, the amalgamation agreement must provide for the cancellation of those membership shares or shares when the amalgamation becomes effective without any repayment of capital in respect thereof, and no provision shall be made in the agreement for the conversion of those membership shares or shares into membership shares or shares of the amalgamated association.

Marginal note:Approval of agreement by Superintendent

228 An amalgamation agreement must be submitted to the Superintendent for approval and any approval of the agreement under subsection 229(4) by the members and the holders of any class or series of shares of an applicant is invalid unless, before the date of the approval, the Superintendent has approved the agreement in writing.

Marginal note:Approval

• 229 (1) The directors of each applicant shall submit an amalgamation agreement for approval to a meeting of the members or shareholders of the applicant association or subsidiary of which they are directors and, subject to subsection (3), to the holders of each class or series of such shares.

• Marginal note:Right to vote

  (2) Each share of an applicant carries the right to vote in respect of an amalgamation agreement whether or not it otherwise carries the right to vote.

• Marginal note:Separate vote for class or series

  (3) The holders of shares of a class or series of shares of each applicant are entitled to vote separately as a class or series in respect of an amalgamation agreement if the agreement contains a provision that, if it were contained in a proposed amendment to the by-laws or incorporating instrument of the applicant, would entitle those holders to vote separately as a class or series.

• Marginal note:Special resolution

  (4) Subject to subsection (3), an amalgamation agreement is approved when the members or shareholders of each applicant association or subsidiary have approved the amalgamation by special resolution.

• Marginal note:Termination

  (5) An amalgamation agreement may provide that, at any time before the issue of letters patent of amalgamation, the agreement may be terminated by the directors of an applicant notwithstanding that the agreement has been approved by the members or shareholders of all or any of the applicant associations or subsidiaries.