An Act to amend certain Acts in relation to financial institutions (S.C. 2005, c. 54)
Full Document:
Assented to 2005-11-25
Marginal note:2001, c. 9, s. 183
113. Section 794 of the English version of the Act is replaced by the following:
Marginal note:Director liability
794. (1) Directors of a bank holding company who vote for or consent to a resolution of the directors authorizing the issue of a share contrary to subsection 709(1) or the issue of subordinated indebtedness contrary to section 723 for a consideration other than money are jointly and severally, or solidarily, liable to the bank holding company to make good any amount by which the consideration received is less than the fair equivalent of the money that the bank holding company would have received if the share or subordinated indebtedness had been issued for money on the date of the resolution.
Marginal note:Further liability
(2) Directors of a bank holding company who vote for or consent to a resolution of the directors authorizing any of the following are jointly and severally, or solidarily, liable to restore to the bank holding company any amounts so distributed or paid and not otherwise recovered by the bank holding company and any amounts in relation to any loss suffered by the bank holding company:
(a) a redemption or purchase of shares contrary to section 715;
(b) a reduction of capital contrary to section 718;
(c) a payment of a dividend contrary to section 722; or
(d) a payment of an indemnity contrary to section 799.
Marginal note:2001, c. 9, s. 183
114. Subsection 797(1) of the English version of the Act is replaced by the following:
Marginal note:Directors liable for wages
797. (1) Subject to subsections (2) and (3), the directors of a bank holding company are jointly and severally, or solidarily, liable to each employee of the bank holding company for all debts not exceeding six months wages payable to the employee for services performed for the bank holding company while they are directors.
Marginal note:2001, c. 9, s. 183
115. Sections 798 and 799 of the Act are replaced by the following:
Marginal note:Defence — due diligence
798. (1) A director, officer or employee of a bank holding company is not liable under section 794 or 797 and has fulfilled their duty under subsection 748(2) if they exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances, including reliance in good faith on
(a) financial statements of the bank holding company that were represented to them by an officer of the bank holding company or in a written report of the auditor of the bank holding company fairly to reflect the financial condition of the bank holding company; or
(b) a report of a person whose profession lends credibility to a statement made by them.
Marginal note:Defence — good faith
(2) A director or officer of a bank holding company has fulfilled their duty under subsection 748(1) if they relied in good faith on
(a) financial statements of the bank holding company that were represented to them by an officer of the bank holding company or in a written report of the auditor of the bank holding company fairly to reflect the financial condition of the bank holding company; or
(b) a report of a person whose profession lends credibility to a statement made by them.
Marginal note:Indemnification
799. (1) A bank holding company may indemnify a director or officer of the bank holding company, a former director or officer of the bank holding company or another person who acts or acted, at the bank holding company’s request, as a director or officer of or in a similar capacity for another entity against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by them in respect of any civil, criminal, administrative, investigative or other proceeding in which they are involved because of that association with the bank holding company or other entity.
Marginal note:Advances
(2) A bank holding company may advance amounts to the director, officer or other person for the costs, charges and expenses of a proceeding referred to in subsection (1). They shall repay the amounts if they do not fulfil the conditions set out in subsection (3).
Marginal note:No indemnification
(3) A bank holding company may not indemnify a person under subsection (1) unless
(a) the person acted honestly and in good faith with a view to the best interests of, as the case may be, the bank holding company or the other entity for which they acted at the bank holding company’s request as a director or officer or in a similar capacity; and
(b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the person had reasonable grounds for believing that their conduct was lawful.
Marginal note:Indemnification — derivative actions
(4) A bank holding company may with the approval of a court indemnify a person referred to in subsection (1) or advance amounts to them under subsection (2) — in respect of an action by or on behalf of the bank holding company or other entity to procure a judgment in its favour to which the person is made a party because of the association referred to in subsection (1) with the bank holding company or other entity — against all costs, charges and expenses reasonably incurred by them in connection with that action if they fulfil the conditions set out in subsection (3).
Marginal note:Right to indemnity
(5) Despite subsection (1), a person referred to in that subsection is entitled to be indemnified by the bank holding company in respect of all costs, charges and expenses reasonably incurred by them in connection with the defence of any civil, criminal, administrative, investigative or other proceeding to which the person is subject because of the association referred to in subsection (1) with the bank holding company or other entity described in that subsection if the person
(a) was not judged by the court or other competent authority to have committed any fault or omitted to do anything that they ought to have done; and
(b) fulfils the conditions set out in subsection (3).
Marginal note:Heirs and personal representatives
(6) A bank holding company may, to the extent referred to in subsections (1) to (5) in respect of the person, indemnify the heirs or personal representatives of any person whom the bank holding company may indemnify under those subsections.
Marginal note:2001, c. 9, s. 183
116. Paragraph 800(b) of the Act is replaced by the following:
(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 bank holding company’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:2001, c. 9, s. 183
117. Paragraph 804(2)(a) of the Act is replaced by the following:
(a) the name of the amalgamated bank holding company and the province in which its head office is to be situated;
Marginal note:2001, c. 9, s. 183
118. (1) Subsection 806(2) of the Act is replaced by the following:
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:2001, c. 9, s. 183
(2) Subsection 806(3) of the English version of the Act is replaced by the following:
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:2001, c. 9, s. 183
119. Subsections 814(1) and (2) of the Act are replaced by the following:
Marginal note:Head office
814. (1) A bank holding company shall at all times have a head office in the province specified in its incorporating instrument or by-laws.
Marginal note:Change of head office
(2) The directors of a bank holding company may change the address of the head office within the province specified in the incorporating instrument or by-laws.
Marginal note:2001, c. 9, s. 183
120. Subsection 816(4) of the Act is replaced by the following:
Marginal note:Access to bank holding company records
(4) Shareholders and creditors of a bank holding company and their personal representatives may examine the records referred to in subsection 815(1) during the usual business hours of the bank holding company and may take extracts from them free of charge or have copies of them made on payment of a reasonable fee. If the bank holding company is a distributing bank holding company, any other person may on payment of a reasonable fee examine those records during the usual business hours of the bank holding company and take extracts from them or have copies of them made.
Marginal note:2001, c. 9, s. 183
121. Subsection 817(3) of the Act is replaced by the following:
Marginal note:Entitlement to list
(3) A shareholder or creditor of a bank holding company or their personal representative — or if the bank holding company is a distributing bank holding company, any person — is entitled to a basic list of shareholders of the bank holding company.
Marginal note:2001, c. 9, s. 183
122. Subsections 822(1) and (2) of the Act are replaced by the following:
Marginal note:Location and processing of information or data
822. (1) Subject to subsection (3), a bank holding company shall maintain and process in Canada any information or data relating to the preparation or maintenance of the records referred to in section 815 or of its central securities register unless the Superintendent has, subject to any terms and conditions that the Superintendent considers appropriate, exempted the bank holding company from the application of this section.
Marginal note:Copies
(2) Subject to subsections (3) and (4), the bank holding company may maintain copies of the records referred to in section 815 or of its central securities register outside Canada and may process outside Canada any information or data relating to those copies.
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