OC,  lending shares by Canadian dealers is covered by IIROC under their Fully-Paid Securities Lending rule.

The follwing is a tedious summary of my read of that.

https://www.iiroc.ca/Documents/2019/c60682f1-0b5d-49ee-863f-3d005f4ac010_en.pdf

A few points are, dealers can only lend shares if the account owner has signed an agreement permitting the deal to lend the shares. Signing this document is part of any margin accounts you may have, but not for non-margin accounts and it is not available for registered accounts. So only shares in a margin account are legally eligible to be lent if you have not signed a Lending agreement. Even in that case you are permitted to provide written instruction exclude lending of specific shares. (see 3.1.5 below).

My take away, with no guarantees, from this is to:

1. put your shares in a non-margin or registered account, and/or

2. to provide written instruction not to lend Poet shares that are in a margin account. Many dealers do not provide collateral value to shares with a price below $5, so shifting Poet shares froim a margin account to a cash account should not affect the collateral value of the margin account.

3. There is no clear language that prevents a dealer from lending shares that have standing sell orders, on an oblique reference to prohibition by the account owner of using lent shares in a hedging scheme.  It may be that some dealers have internal risk management procedures that specify this condition, even though they are potentialy subject to this operational risk in any share.

Some details,

1.4 Operation

The Dealer holds fully-paid securities in custody for their own clients, clients of other Dealers (Introducing brokers), and/or clients of the Portfolio Managers. If a client wants to be part of the FPL program, they must sign a securities loan agreement with the Dealer and acknowledge that they understand and accept the risks associated with lending out their fully-paid securities. Once the client is enrolled in the FPL program, the Dealer may borrow securities from the client at any time. When the Dealer borrows fully-paid securities from the client’s securities trading account, they send a confirmation to the client and set collateral aside for them. The client continues to see the lent fully-paid securities in their account but the positions will not be shown as segregated and cannot be used in any hedging strategy. 

The other key restriction is on page 8 of the document, shown below:

3.1.2 Securities eligible for the FPL program

The Dealer must ensure that the FPL program is restricted to equity securities that are

• listed on an Exchange, and • held by clients in their non-registered accounts only.

The Dealer must also ensure that for equity securities listed on an exchange in Canada, the FPL program includes only those securities that meet at least one of the following criteria

-6-month average volume weighted average price (VWAP) ≥ $2.00, or

• 6 month average daily trading volume ≥ 100,000 shares, or

• 6-month average free float market capitalization ≥ $200 million.

3.1.5 Client-stipulated restrictions

The Dealer must obtain instructions from the client on:

• securities that they would like to exclude from the fully-paid lending program, and

• their maximum risk tolerance limit on the total dollar value of securities they are willing to lend under the FPL program. The Dealer is required to review FPL program transactions against this criteria daily and terminate loans that exceed the client’s risk tolerance limit as soon as possible.