An Act to amend certain Acts in relation to financial institutions (S.C. 2005, c. 54)
Full Document:
Assented to 2005-11-25
11. The Act is amended by adding the following after section 72:
Marginal note:Exception — conditions before acquisition
72.1 (1) A bank may permit its subsidiary to acquire shares of the bank, shares of an entity that controls the bank or any ownership interests of any unincorporated entity that controls the bank if before the subsidiary acquires them the conditions prescribed for the purposes of this subsection are met.
Marginal note:Conditions after acquisition
(2) After a subsidiary has acquired shares or ownership interests in accordance with subsection (1), the conditions prescribed for the purposes of this subsection are to be met.
Marginal note:Non-compliance with conditions
(3) Despite section 16 and subsection 66(2), the issue and acquisition of the shares or ownership interests are subject to the prescribed requirements if
(a) the bank permits the subsidiary to acquire the shares or ownership interests; and
(b) either
(i) a condition prescribed for the purposes of subsection (1) was not met, or
(ii) a condition prescribed for the purposes of subsection (2) was not met or ceased to be met.
12. Section 86 of the Act is replaced by the following:
Marginal note:Signatures
86. (1) A security certificate shall be signed by or bear the printed or otherwise mechanically reproduced signature of at least one of the following:
(a) a director or officer of the bank;
(b) a registrar or transfer agent of the bank or a branch transfer agent or a natural person on their behalf; or
(c) a trustee who certifies it in accordance with a trust indenture.
Marginal note:Continuation of validity of signature
(2) If a security certificate contains a person’s printed or mechanically reproduced signature, the bank may issue the security certificate even if the person has ceased to be a director or officer of the bank. The security certificate is as valid as if the person were a director or officer at the date of its issue.
13. Section 88 of the Act is replaced by the following:
Marginal note:Restrictions and charges
88. (1) No charge in favour of a bank and no restriction on transfer other than a constraint under Part VII is effective against a transferee of a security issued by the bank if the transferee has no actual knowledge of the charge or restriction unless it or a reference to it is noted conspicuously on the security certificate.
Marginal note:No restriction
(2) If any of the issued shares of a distributing bank remain outstanding and are held by more than one person, the bank may not restrict the transfer or ownership of its shares except by way of a constraint under Part VII.
Marginal note:Continuance
(3) If a body corporate that is continued as a bank under this Act has outstanding security certificates and the words “private company” or “private corporation” appear on the certificates, those words are deemed to be a notice of a charge or restriction for the purposes of subsection (1).
Marginal note:2001, c. 9, s. 62(F)
14. (1) Subsection 93(1) of the Act is replaced by the following:
Marginal note:Dealings with registered owner
93. (1) A bank or a trustee within the meaning of section 294 may, subject to subsections 137(5) to (7) and sections 138 to 141 and 145, treat the registered owner of a security as the person exclusively entitled to vote, to receive notices, to receive any interest, dividend or other payment in respect of the security and to exercise all of the rights and powers of an owner of the security.
Marginal note:2001, c. 9, s. 62(F)
(2) Paragraph 93(2)(b) of the English version of the Act is replaced by the following:
(b) the personal representative of a registered security holder who is a minor, an incompetent person or a missing person; or
15. Section 94 of the English version of the Act is replaced by the following:
Marginal note:Minors
94. If a minor exercises any rights of ownership in the securities of a bank, no subsequent repudiation or avoidance is effective against the bank.
16. Section 136 of the Act is renumbered as subsection 136(1) and is amended by adding the following:
Marginal note:Participation by electronic means
(2) Unless the by-laws provide otherwise, any person who is entitled to attend a meeting of shareholders may participate in the meeting by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting if the bank makes one available. A person who is participating in a meeting by one of those means is deemed for the purposes of this Act to be present at the meeting.
Marginal note:Regulations
(3) The Governor in Council may make regulations respecting the manner of and conditions for participating in a meeting by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting.
17. Subsections 137(2) to (5) of the Act are replaced by the following:
Marginal note:Order to delay calling annual meeting
(2) Despite subsection (1), the bank may apply to the court for an order extending the time for calling an annual meeting.
Marginal note:Obligation to notify Superintendent
(3) The bank shall give notice of the application to the Superintendent before any hearing concerning the application and shall provide the Superintendent with a copy of any order that is issued.
Marginal note:Superintendent’s right to appear
(4) The Superintendent is entitled to appear and be heard in person or by counsel at any hearing concerning the application.
Marginal note:Authority to fix record date
(5) The directors may in advance fix a record date, that is within the prescribed period, for the determination of shareholders for any purpose, including for a determination of which shareholders are entitled to
(a) receive payment of a dividend;
(b) participate in a liquidation distribution;
(c) receive notice of a meeting of shareholders; or
(d) vote at a meeting of shareholders.
Marginal note:Determination of record date
(6) If no record date is fixed,
(a) the record date for the determination of shareholders who are entitled to receive notice of a meeting of shareholders is
(i) at the close of business on the day immediately preceding the day on which the notice is given, or
(ii) if no notice is given, the day on which the meeting is held; and
(b) the record date for the determination of shareholders for any other purpose, other than to establish a shareholder’s right to vote, is at the close of business on the day on which the directors pass a resolution in respect of that purpose.
Marginal note:Notice of record date
(7) If a record date is fixed and unless notice of the record date is waived in writing by every holder of a share of the class or series affected whose name is set out in the securities register at the close of business on the day on which the directors fix the record date, notice of the record date shall be given within the prescribed period by
(a) advertisement in a newspaper in general circulation in the place where the bank’s head office is situated and in each place in Canada where the bank has a transfer agent or where a transfer of its shares may be recorded; and
(b) written notice to each stock exchange in Canada on which the bank’s shares are listed for trading.
18. Subsection 138(1) of the Act is replaced by the following:
Marginal note:Notice of meeting
138. (1) Notice of the time and place of a meeting of shareholders of a bank shall be sent within the prescribed period to
(a) each shareholder entitled to vote at the meeting;
(b) each director;
(c) the auditor or auditors of the bank; and
(d) the Superintendent.
Marginal note:Exception
(1.01) In the case of a bank that is not a distributing bank, notice may be sent within any shorter period specified in its by-laws.
19. Subsection 139(1) of the Act is replaced by the following:
Marginal note:Notice not required
139. (1) A notice of a meeting is not required to be sent to shareholders who are not registered on the records of the bank or the bank’s transfer agent on the record date fixed under paragraph 137(5)(c) or determined under paragraph 137(6)(a).
20. (1) Subsection 143(1) of the Act is replaced by the following:
Marginal note:Proposals
143. (1) Subject to subsections (1.1) and (1.2), a registered holder or beneficial owner of shares that may be voted at an annual meeting of shareholders may
(a) submit to the bank notice of any matter that they propose to raise at the meeting (in this section and section 144 referred to as a “proposal”); and
(b) discuss at the meeting any matter in respect of which they would have been entitled to submit a proposal.
Marginal note:Eligibility to submit proposal
(1.1) To be eligible to submit a proposal a person shall
(a) for at least the prescribed period be the registered holder or beneficial owner of at least the prescribed number of the bank’s outstanding shares; or
(b) have the support of persons who, in the aggregate and including or not including the person who submits the proposal, have for at least the prescribed period been the registered holders or beneficial owners of at least the prescribed number of the bank’s outstanding shares.
Marginal note:Information to be provided
(1.2) A proposal is to be accompanied by the following information:
(a) the name and address of the person submitting the proposal and the names and addresses of their supporters, if any; and
(b) the number of shares held or owned by the person and their supporters, if any, and the date that the shares were acquired.
Marginal note:Information not part of proposal
(1.3) The information provided under subsection (1.2) does not form part of a proposal or of the supporting statement referred to in subsection (3) and is not to be included for the purpose of the prescribed maximum number of words referred to in subsection (3).
Marginal note:Proof may be required
(1.4) If the bank requests within the prescribed period that a person provide proof that they are eligible to submit a proposal, the person shall within the prescribed period provide proof that they meet the requirements of subsection (1.1).
(2) Subsections 143(3) to (5) of the Act are replaced by the following:
Marginal note:Supporting statement
(3) At the request of the person who submits a proposal, the bank shall set out in the management proxy circular or attach to it the person’s statement in support of the proposal and their name and address. The statement and proposal together are not to exceed the prescribed maximum number of words.
Marginal note:Nomination of directors
(4) A proposal may include nominations for the election of directors if it is signed by one or more registered holders or beneficial owners of shares representing in the aggregate not less than 5% of the shares of the bank or 5% of the shares of a class of its shares entitled to vote at the meeting at which the proposal is to be presented.
Marginal note:Exemption
(5) A bank is not required to comply with subsections (2) and (3) if
(a) the proposal is not submitted to the bank at least the prescribed number of days before the anniversary date of the notice of meeting that was sent to shareholders in respect of the previous annual meeting of shareholders;
(b) it clearly appears that the primary purpose of the proposal is to enforce a personal claim or redress a personal grievance against the bank or its directors, officers or security holders;
(b.1) it clearly appears that the proposal does not relate in a significant way to the business or affairs of the bank;
(c) the person submitting the proposal failed within the prescribed period before the bank receives their proposal to present, in person or by proxy, at a meeting of shareholders a proposal that at their request had been set out in or attached to a management proxy circular;
(d) substantially the same proposal was set out in or attached to a management proxy circular or dissident’s proxy circular relating to, and presented to shareholders at, a meeting of shareholders held within the prescribed period before the receipt of the proposal and did not receive the prescribed minimum amount of support at the meeting; or
(e) the rights conferred by subsections (1) to (4) are being abused to secure publicity.
Marginal note:Bank may refuse to include proposal
(5.1) If a person who submits a proposal fails to continue to hold or own shares in accordance with paragraph (1.1)(a) or, as the case may be, does not continue to have the support of persons who are in the aggregate the registered holders or beneficial owners of the prescribed number of shares in accordance with paragraph (1.1)(b) until the end of the meeting, the bank is not required to set out any proposal submitted by that person in or attach it to a management proxy circular for any meeting held within the prescribed period after the day of the meeting.
- Date modified: