Lien on Shares Clause (Articles of Incorporation) (CBCA, OBCA)

Summary

This is a lien on shares clause for an Ontario or federal corporation, to be included under the share provisions in the articles of incorporation. It contains practical guidance and drafting notes. This precedent is a clause for a corporation's articles of incorporation authorizing the corporation to have a lien on all shares issued by the corporation to assist in enforcement of any debt obligation owed to the corporation by a shareholder. A lien on shares is a form of security which gives the corporation the right to retain possession of the shares until the settlement of a debt owed by a shareholder. This clause sets out the provisions typically included in these clauses for articles of incorporation under the federal or provincial laws of Canada. This clause is drafted for a corporation incorporated under the Canada Business Corporations Act, R.S.C. 1985, c. C-44 or the Ontario Business Corporations Act, R.S.O. 1990, c. B.16. For more information on incorporation and establishment ...