350CCUs not to be issued unless terms of issue approved by Registrar

350 CCUs not to be issued unless terms of issue approved by Registrar

(1) A co-operative is not to issue CCUs unless:

(a) the terms of issue have been approved by a special resolution of the co-operative; and

(b) the issue is made pursuant to an offer accompanied by a copy of a statement approved by the Registrar for the purposes of the issue; and

(c) the Registrar approves of the terms of the issue.

(2) The terms of issue must specify the following (but this subsection does not limit the contents of the terms of issue):

(a) details of entitlement to repayment of capital;

(b) details of entitlement to participate in surplus assets and profits;

(c) details of entitlement to interest on capital (whether cumulative or non-cumulative interest);

(d) details of how capital and interest on capital are to rank for priority of payment on a winding up;

(e) whether there is a limit on the total holding of CCUs that may be acquired by persons who are not members of the co-operative and, if there is a limit, what the limit is.

(3) The statement approved by the Registrar for the purposes of the issue is to set out the terms of the issue, the rights of the holders of CCUs, the terms of redemption and the manner of transferability of CCUs.

(4) The Registrar is not to approve of the terms of issue unless satisfied that they will not result in a failure to comply with co-operative principles and are not contrary to the rules of the co-operative or this Law.