288. (1) In this Division,

“affiliate” means a body corporate that is affiliated with another body corporate within the meaning of subsection 6(2);

“business combination” means an acquisition of all or substantially all the assets of one body corporate by another body corporate or an amalgamation of two or more bodies corporate;

“call” means an option, transferable by delivery, to demand delivery of a specified number or amount of shares at a fixed price within a specified time but does not include an option or right to acquire shares of the body corporate that granted the option or right to acquire;

“distributing company” means a company, any of the issued securities of which are or were part of a distribution to the public and remain outstanding and are held by more than one person;

“insider” means, except in subsections 294(2) and 295(1),

(a) a director or an officer of a distributing company,

(b) a distributing company that purchases or otherwise acquires, except by means of a donation or redemption, shares issued by it or by any of its affiliates, or

(c) a person who beneficially owns more than 10 per cent of the shares of a distributing company or who exercises control or direction over more than 10 per cent of the votes attached to shares of a distributing company, excluding shares owned by a securities underwriter under an underwriting agreement while those shares are in the course of a distribution to the public;

“officer”, in relation to a company, means

(a) an officer as defined in paragraph (a) of the definition “officer” in section 2, or

(b) any natural person who performs functions for the company similar to those performed by a person referred to in paragraph (a) of the definition “officer” in section 2;

“put” means an option, transferable by delivery, to deliver a specified number or amount of shares at a fixed price within a specified time;

“share” means a voting share and includes

(a) a security currently convertible into a voting share, and

(b) a currently exercisable option or a right to acquire a voting share or a security referred to in paragraph (a).

(2) For the purposes of this Division, a person controls a body corporate where the person controls the body corporate within the meaning of section 3, determined without regard to paragraph 3(1)(d).

(3) For the purposes of this Division,

(a) a director or an officer of a body corporate that is an insider of a distributing company is deemed to be an insider of the distributing company;

(b) a director or an officer of a body corporate that is a subsidiary of a distributing company is deemed to be an insider of the distributing company;

(c) a person is deemed to beneficially own shares beneficially owned by a body corporate controlled directly or indirectly by that person;

(d) a body corporate is deemed to beneficially own shares beneficially owned by its affiliates; and

(e) the acquisition or disposition by an insider of an option or right to acquire a share is deemed to be a change in the beneficial ownership of the share to which the option or right to acquire relates.

(4) For the purposes of this Division,

(a) if a body corporate becomes an insider of a distributing company or enters into a business combination with a distributing company, or

(b) if a distributing company becomes an insider of a body corporate,

every director or officer of the body corporate and every shareholder of the body corporate who is a person referred to in paragraph (c) of the definition “insider” in subsection (1) is deemed to have been an insider of the distributing company for the previous six months or for such shorter period as the director, officer or shareholder was a director, officer or shareholder of the body corporate.

289. (1) An insider shall send to the Superintendent an insider report in prescribed form not later than ten days after the later of

(a) the end of the month in which the person became an insider, and

(b) the end of the month in which regulations prescribing the form of an insider report come into force.

(2) [Repealed, 1997, c. 15, s. 231]

(3) A person who is an insider of a body corporate on the day it is continued as a company under this Act shall, if the company is a distributing company, send to the Superintendent an insider report in prescribed form not later than ten days after

(a) the end of the month in which the body corporate is continued under this Act, or

(b) the end of the month in which regulations prescribing the form of an insider report come into force,

whichever is later.

(4) A person who is deemed to have been an insider under subsection 288(4) shall, not later than ten days after

(a) the end of the month in which the person is deemed to have become an insider, or

(b) the end of the month in which regulations prescribing the form of an insider report come into force,

whichever is later, send to the Superintendent in prescribed form and for the period in respect of which the person is deemed to have been an insider, the insider report that the person would have been required to send under this section had the person been otherwise an insider for that period.

1991, c. 47, s. 289; 1997, c. 15, s. 231.

290. An insider whose interest in securities of a distributing company changes from that shown or required to be shown in the last insider report sent or required to be sent by the insider shall, within ten days after the end of the month in which the change takes place, send an insider report in prescribed form to the Superintendent.

290.1 Under prescribed circumstances, an insider is exempt from any of the requirements of section 289 or 290.

1997, c. 15, s. 232.

291. (1) An insider report of a person that includes securities deemed to be beneficially owned by that person is deemed to be an insider report of a body corporate referred to in paragraph 288(3)(c) and the body corporate is not required to send a separate insider report.

(2) An insider report of a body corporate that includes securities deemed to be beneficially owned by the body corporate is deemed to be an insider report of an affiliate referred to in paragraph 288(3)(d) and the affiliate is not required to send a separate insider report.

(3) An insider report of a person that includes securities deemed to be beneficially owned by that person pursuant to paragraph 288(3)(c) or (d) shall disclose separately

(a) the number of securities owned by a body corporate; and

(b) the name of the body corporate.

292. (1) On an application by or on behalf of an insider, the Superintendent may, in writing, on such terms as the Superintendent thinks fit, exempt the insider from any of the requirements of sections 289 to 291, and the exemption may be given retroactive effect.

(2) The Superintendent shall summarize or cause to be summarized in a periodical available to the public the information contained in insider reports sent to the Superintendent under sections 288 to 291 and the particulars of exemptions granted under subsection (1) together with the reasons therefor.

293. (1) An insider shall not knowingly sell, directly or indirectly, a share of the distributing company or any of its affiliates if the insider does not own or has not fully paid for the share to be sold.

(2) Notwithstanding subsection (1), an insider may sell a share that the insider does not own if the insider owns another share convertible into the share sold or an option or right to acquire the share sold and, within ten days after the sale, the insider

(a) exercises the conversion privilege, option or right and delivers the share so acquired to the purchaser; or

(b) transfers the convertible share, option or right to the purchaser.

(3) An insider shall not, directly or indirectly, buy or sell a call or put in respect of a share of the company or any of its affiliates.

294. (1) In subsections (2) and 295(1), “insider” means, with respect to a company,

(a) the company;

(b) an affiliate of the company;

(c) a director or an officer of the company;

(d) a person who beneficially owns more than 10 per cent of the shares of the company or who exercises control or direction over more than 10 per cent of the votes attached to the shares of the company;

(e) a person employed or retained by the company; and

(f) a person who receives specific confidential information from a person described in this section, including a person described in this paragraph, and who has knowledge that the person giving the information is a person described in this section, including a person described in this paragraph.

(2) For the purposes of subsection 295(1),

(a) if a body corporate becomes an insider of a company or enters into a business combination with a company, or

(b) if a company becomes an insider of a body corporate,

every director or officer of the body corporate is deemed to have been an insider of the company for the previous six months or for such shorter period as the director or officer was a director or officer of the body corporate.

295. (1) An insider who, in connection with a transaction in a security of the company or any of its affiliates, makes use of any specific confidential information for the insider’s own benefit or advantage that, if generally known, might reasonably be expected to affect materially the value of the security is

(a) liable to compensate any person for any direct loss suffered by that person as a result of the transaction, unless the information was known or in the exercise of reasonable diligence should have been known to that person; and

(b) accountable to the company for any direct benefit or advantage received or receivable by the insider as a result of the transaction.

(2) An action to enforce a right created by subsection (1) may not be commenced

(a) after a period of two years after discovery of the facts that gave rise to the cause of action; or

(b) if the transaction was required to be reported under sections 289 to 291, after a period of two years from the time of reporting under those sections.

296. In this Division, “distribution” means

(a) a trade by or on behalf of a company in securities of the company that have not previously been issued; or

(b) a trade in previously issued securities of a company from the holdings of any person or group of persons who act in concert and who hold in excess of 10 per cent of the shares of any class of voting shares of the company.

297. (1) After the day that is twelve months after the coming into force of this section, a company shall not distribute any of its securities and a person shall not distribute any securities of a company unless a preliminary prospectus and a prospectus in a form substantially as prescribed have been filed with the Superintendent in relation to the distribution and receipts have been received therefor from the Superintendent.

(2) Where there is filed in any jurisdiction a preliminary prospectus, prospectus, short-form prospectus or similar document relating to the distribution of securities in a form substantially as prescribed, a copy of that document may be accepted by the Superintendent under subsection (1).

298. (1) A preliminary prospectus in relation to the distribution of securities shall substantially comply with the requirements of this Act and any regulations made under subsection 299(1) respecting the form and content of a prospectus, except that any report or reports of the auditors of the company required by the regulations need not be included.

(2) A preliminary prospectus in relation to the distribution of securities need not include information in respect of the price to the securities underwriter or the offering price of any securities or any other matters dependent on or relating to that price.

299. (1) The Governor in Council may make regulations

(a) respecting the form and content of a preliminary prospectus and a prospectus;

(b) specifying the financial statements, reports and other documents that are to be included with a preliminary prospectus and a prospectus;

(c) respecting, for the purposes of subsection 303(1), the disclosure of material facts in relation to securities to be distributed;

(d) respecting the distribution of a preliminary prospectus and a prospectus to prospective purchasers;

(e) exempting any class of distributions from the application of this Division, other than this section; and

(f) generally, for carrying out the purposes and provisions of this Division, other than this section.

(2) Any regulation made under subsection (1) may authorize the Superintendent to permit or require additions to, variations in or omissions from

(a) a preliminary prospectus or prospectus; or

(b) any information, report or document contained or required to be contained in the preliminary prospectus or prospectus or related thereto.

(3) Where a regulation described in subsection (2) has been made, the Superintendent may exercise the authority thereby given in any case where the Superintendent is satisfied that it is necessary to do so owing to the circumstances related to the issue of the securities concerned.

(4) All additions, variations or omissions referred to in subsection (2) shall be made in accordance with the permission or requirement of the Superintendent under that subsection and shall be in accordance with such terms and conditions, if any, as the Superintendent may impose as being necessary to ensure, to the greatest extent possible, a full, true and plain disclosure of all material facts relating to the securities to be distributed.

1991, c. 47, s. 299; 1994, c. 26, s. 39(F); 1999, c. 31, s. 140.

300. (1) On application by a company or any person proposing to make a distribution, the Superintendent may, by order, exempt that distribution from the application of this Division, other than this section and section 299, if the Superintendent is satisfied that the company has filed or is about to file, in compliance with the laws of the relevant jurisdiction, a prospectus relating to the distribution that, in form and content, substantially complies with the requirements of this Act and any regulations made under subsection 299(1).

(2) An order under subsection (1) may contain such conditions or limitations as the Superintendent deems appropriate.

1991, c. 47, s. 300; 1999, c. 31, s. 141.

301. (1) The Superintendent shall issue a receipt for a preliminary prospectus forthwith on its filing with the Superintendent.

(2) A person proposing to distribute securities of a company to which a preliminary prospectus relates shall maintain a record of all persons to whom a copy of the preliminary prospectus has been sent.

(3) Where it appears to the Superintendent, after providing a reasonable opportunity to the person by whom the preliminary prospectus was filed to make representations, that a preliminary prospectus in respect of which a receipt has been issued under subsection (1) is defective in that it does not substantially comply with the requirements of this Act and the regulations, the receipt may be withdrawn and the person by whom the preliminary prospectus was filed shall forthwith be notified of its withdrawal.

(4) Notice of withdrawal of a receipt under subsection (3) shall forthwith be sent by the person by whom the preliminary prospectus was filed to any persons proposing to take part in the distribution of the securities to which the preliminary prospectus relates and, by the company and each such person, to each person named on the records maintained in respect of the preliminary prospectus by the company and each such person.

302. (1) The Superintendent shall issue a receipt for a prospectus forthwith on its filing with the Superintendent unless, after providing a reasonable opportunity to the person by whom the prospectus was filed to make representations, it appears to the Superintendent that

(a) the prospectus or any document required to be filed therewith

(i) fails to substantially comply with any of the requirements of this Act or the regulations, or

(ii) contains a misrepresentation or any statement, promise, estimate or forecast that is misleading, false or deceptive; or

(b) it would not be in the public interest to issue a receipt for the prospectus.

(2) to (4) [Repealed, 1996, c. 6, s. 75]

1991, c. 47, s. 302; 1996, c. 6, s. 75.

303. (1) A prospectus shall provide full, true and plain disclosure of all material facts relating to the securities to be distributed and shall contain or be accompanied by such financial statements, reports or other documents as are required by any regulations made under subsection 299(1).

(2) A prospectus shall include a certificate in prescribed form signed

(a) by the chief executive officer and the chief financial officer of the company making the distribution or, in the event of the absence or inability to act of either of those officers, any other officer of the company authorized by the directors to sign in the stead of the officer who is absent or unable to act, and such other persons as are prescribed, and

(b) in the case of an initial distribution of shares of a company incorporated after the coming into force of this section, by each person who is a promoter of the company

to the effect that, according to the person’s information, knowledge and belief, the disclosure required by subsection (1) and by any regulations made under subsection 299(1) has been provided.

(3) For the purposes of subsection (2) and section 305, “promoter” means an applicant for letters patent to incorporate a company or a director named in the application for letters patent, but such an applicant or director is a promoter only for the period of two years following the application.

304. Where a securities underwriter is associated in the distribution of securities of a company, a prospectus shall include a certificate in prescribed form signed by each securities underwriter who, with respect to the securities offered by the prospectus, is in a contractual relationship with the company or other distributor of the securities, to the effect that, according to the securities underwriter’s information, knowledge and belief, the disclosure required by subsection 303(1) and by any regulations made under subsection 299(1) has been provided.

305. With the consent of the Superintendent, an agent, duly authorized in writing, of a promoter or a securities underwriter referred to in subsection 303(2) or section 304 may, on behalf of the promoter or securities underwriter, as the circumstances require, sign the certificate referred to in that subsection or section.

306. No person shall distribute a preliminary prospectus or a prospectus in relation to a distribution of securities of a company except in accordance with any regulations made under subsection 299(1).

307. (1) In this Division,

“affiliate” means a body corporate that is affiliated with another body corporate within the meaning of subsection 6(2);

“associate of the offeror” means

(a) a body corporate that an offeror, directly or indirectly, controls, determined without regard to paragraph 3(1)(d), or of which an offeror beneficially owns shares or securities currently convertible into shares carrying more than 10 per cent of the voting rights under all circumstances or by reason of the occurrence of an event that has occurred and is continuing, or a currently exercisable option or right to purchase the shares or the convertible securities,

(b) a partner of the offeror acting on behalf of the partnership of which they are partners,

(c) a trust or estate in which the offeror has a substantial beneficial interest or in respect of which the offeror serves as a trustee or in a similar capacity,

(d) a spouse or common-law partner of the offeror,

(e) a child of the offeror or of the offeror’s spouse or common-law partner, or

(f) a relative of the offeror or of the offeror’s spouse or common-law partner, if that relative has the same residence as the offeror;

“dissenting offeree” means, in respect of a take-over bid made for all the shares of a class of shares, a holder of a share of that class who does not accept the take-over bid and includes a subsequent holder of that share who acquires it from the first-mentioned holder;

“exempt offer” means an offer

(a) to fewer than fifteen shareholders to purchase shares by way of separate agreements,

(b) to purchase shares through a stock exchange or in the over-the-counter market in such circumstances as may be prescribed,

(c) to purchase shares of a company that has fewer than fifteen shareholders, two or more joint holders being counted as one shareholder, or

(d) exempted under the order of a court having jurisdiction in the place where the head office of the offeree company is located;

“offeree” means a person to whom a take-over bid is made;

“offeree company” means a company the shares of which are the object of a take-over bid;

“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” includes

(a) a security currently convertible into a share, and

(b) a currently exercisable option or right to acquire a share or a security referred to in paragraph (a);

“take-over bid” means

(a) an offer, other than an exempt offer, made by an offeror to shareholders at approximately the same time to acquire shares that, if combined with shares already beneficially owned or controlled, directly or indirectly, by the offeror or an affiliate or associate of the offeror on the date of the offer, would exceed 10 per cent of any class of issued shares of an offeree company, and

(b) an offer to purchase shares of a company having fewer than fifteen shareholders if the offer is made to all shareholders in the prescribed form and manner,

and includes every offer, other than an exempt offer, by an issuer to repurchase its own shares.

(2) For the purposes of this Division, a person controls a body corporate when the person controls the body corporate within the meaning of section 3, determined without regard to paragraph 3(1)(d).

(3) A take-over bid is deemed to be dated as of the date on which it is sent.

1991, c. 47, s. 307; 2000, c. 12, s. 154.

308. If, within one hundred and twenty days after the date of a take-over bid, the bid is accepted by the holders of not less than 90 per cent of the shares of any class of shares to which the take-over bid relates, other than shares held at the date of the take-over bid by or on behalf of the offeror or an affiliate or associate of the offeror, the offeror is entitled, on complying with this Division, to acquire the shares held by the dissenting offerees.

309. (1) An offeror may acquire shares held by a dissenting offeree by sending by registered mail within sixty days after the date of termination of the take-over bid and in any event within one hundred and eighty days after the date of the take-over bid, an offeror’s notice to each dissenting offeree and to the Superintendent stating that

(a) offerees holding not less than 90 per cent of the shares of any class of shares to which the take-over bid relates, other than shares held at the date of the take-over bid by or on behalf of the offeror or an affiliate or associate of the offeror, have accepted the take-over bid;

(b) the offeror is bound to take up and pay for or has taken up and paid for the shares of the offerees who accepted the take-over bid;

(c) a dissenting offeree is required to elect

(i) to transfer the dissenting offeree’s shares to the offeror on the same terms on which the offeror acquired the shares from the offerees who accepted the take-over bid, or

(ii) to demand payment of the fair value of the dissenting offeree’s shares in accordance with sections 313 to 316 by notifying the offeror within twenty days after receipt of the offeror’s notice;

(d) a dissenting offeree who does not notify the offeror in accordance with subparagraph (c)(ii) is deemed to have elected to transfer the dissenting offeree’s shares to the offeror on the same terms on which the offeror acquired the shares from the offerees who accepted the take-over bid; and

(e) a dissenting offeree must send the dissenting offeree’s shares to which the take-over bid relates to the offeree company within twenty days after the dissenting offeree receives the offeror’s notice.

(2) Concurrently with sending the offeror’s notice under subsection (1), the offeror shall send to the offeree company a notice of adverse claim in accordance with subsection 133(1) with respect to each share held by a dissenting offeree.

310. A dissenting offeree to whom an offeror’s notice is sent under subsection 309(1) shall, within twenty days after receipt of that notice, send the dissenting offeree’s share certificates of the class of shares to which the take-over bid relates to the offeree company.

311. (1) Within twenty days after the offeror sends an offeror’s notice under subsection 309(1), the offeror shall pay or transfer to the offeree company 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 transfer the dissenting offeree’s shares as described in subparagraph 309(1)(c)(i).

(2) An offeree company is deemed to hold in a fiduciary capacity for the dissenting offerees the money or other consideration it receives under subsection (1).

(3) An offeree company shall deposit the money received under subsection (1) in a separate account in a deposit-taking financial institution in Canada and the offeree company shall place any other consideration in the custody of a deposit-taking financial institution in Canada.

312. Within thirty days after an offeror sends an offeror’s notice under subsection 309(1), the offeree company shall

(a) 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 transfer shares as described in subparagraph 309(1)(c)(i) and who sends the share certificates as required under section 310, the money or other consideration to which that dissenting offeree is entitled, disregarding fractional shares, which may be paid for in money; and

(c) send to each dissenting offeree who has not sent share certificates as required under section 310 a notice stating that

(i) the shares have been cancelled,

(ii) the offeree company or some designated person holds in a fiduciary capacity for that offeree the money or other consideration to which that offeree is entitled as payment for or in exchange for the shares, and

(iii) the offeree company will, subject to sections 313 to 316, send that money or other consideration to that offeree forthwith after receiving the share certificates.

313. (1) Where a dissenting offeree has elected to demand payment of the fair value of the offeree’s shares as described in subparagraph 309(1)(c)(ii), the offeror may, within twenty days after it has paid the money or transferred the other consideration under subsection 311(1), apply to a court to fix the fair value of the shares of that dissenting offeree.

(2) If an offeror fails to apply to a court under subsection (1), a dissenting offeree may apply to a court for the same purpose within a further period of twenty days.

(3) An application under subsection (1) or (2) shall be made to a court having jurisdiction in the place at which the head office of the company is situated or in the province in which the dissenting offeree resides if the company carries on business in that province.

(4) A dissenting offeree is not required to give security for costs in an application made under subsection (1) or (2).

314. On an application under subsection 313(1) or (2),

(a) all dissenting offerees who have made elections under subparagraph 309(1)(c)(ii) and whose shares have not been acquired by the offeror shall be joined as parties and are bound by the decision of the court; and

(b) the offeror shall notify each affected dissenting offeree of the date, place and consequences of the application and of the dissenting offeree’s right to appear and be heard in person or by counsel at the hearing of the application.

315. (1) On an application to a court under subsection 313(1) or (2), the court may determine whether any other person is a dissenting offeree who should be joined as a party, and the court shall then fix a fair value for the shares of all dissenting offerees.

(2) A court may in its discretion appoint one or more appraisers to assist the court in fixing a fair value for the shares of a dissenting offeree.

(3) The final order of a court shall be made against the offeror in favour of each dissenting offeree and for the amount for each dissenting offeree’s shares as fixed by the court.

(4) In connection with proceedings under subsection 313(1) or (2), a court may make any order it thinks fit and, without limiting the generality of the foregoing, may

(a) fix the amount of money or other consideration that is deemed to be held in a fiduciary capacity under subsection 311(2);

(b) order that the money or other consideration is to be held in trust by a person other than the offeree company;

(c) allow a reasonable rate of interest on the amount payable to each dissenting offeree from the date the dissenting offeree sends the share certificates required under section 310 until the date of payment; or

(d) order that any money payable to a shareholder who cannot be found be paid to the Receiver General.

(5) If at any time a person establishes an entitlement to any moneys paid to the Receiver General under this section, the Receiver General shall pay an equivalent amount to that person out of the Consolidated Revenue Fund.

316. Where no application is made to a court under subsection 313(2) within the period set out in that subsection, a dissenting offeree is deemed to have elected to transfer the dissenting offeree’s shares to the offeror on the same terms on which the offeror acquired the shares from the offerees who accepted the take-over bid.