747. (1) Subject to this Act, the directors of a bank holding company shall manage or supervise the management of the business and affairs of the bank holding company.

(2) Without limiting the generality of subsection (1), the directors of a bank holding company shall

(a) establish an audit committee to perform the duties referred to in subsections 782(3) and (4);

(b) establish procedures to resolve conflicts of interest, including techniques for the identification of potential conflict situations and for restricting the use of confidential information;

(c) designate a committee of the board of directors to monitor the procedures referred to in paragraph (b); and

(d) establish investment and lending policies, standards and procedures in accordance with section 927.

(3) Paragraph (2)(a) does not apply to the directors of a bank holding company if

(a) all the voting shares of the bank holding company are beneficially owned by a Canadian financial institution described in any of paragraphs (a) to (d) of the definition “financial institution” in section 2; and

(b) the audit committee of the financial institution performs for and on behalf of the bank holding company all the functions that would otherwise be required to be performed by the audit committee of the bank holding company under this Part.

2001, c. 9, s. 183.

748. (1) Every director and officer of a bank holding company in exercising any of the powers of a director or an officer and discharging any of the duties of a director or an officer shall

(a) act honestly and in good faith with a view to the best interests of the bank holding company; and

(b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

(2) Every director, officer and employee of a bank holding company shall comply with this Act, the regulations, the bank holding company’s incorporating instrument and the by-laws of the bank holding company.

(3) No provision in any contract, in any resolution or in the by-laws of a bank holding company relieves any director, officer or employee of the bank holding company from the duty to act in accordance with this Act and the regulations or relieves a director, officer or employee from liability for a breach thereof.

2001, c. 9, s. 183.

749. (1) A bank holding company shall have at least seven directors.

(2) At least one half of the directors of a bank holding company that is a subsidiary of a foreign bank and at least two-thirds of the directors of any other bank holding company must be, at the time of each director’s election or appointment, resident Canadians.

2001, c. 9, s. 183.

750. The following persons are disqualified from being directors of a bank holding company:

(a) a person who is less than eighteen years of age;

(b) a person who is of unsound mind and has been so found by a court in Canada or elsewhere;

(c) a person who has the status of a bankrupt;

(d) a person who is not a natural person;

(e) a person who is prohibited by subsection 156.09(9) or section 901 or 914 from exercising voting rights attached to shares of the bank holding company;

(f) a person who is an officer, director or full time employee of an entity that is prohibited by subsection 156.09(9) or section 901 or 914 from exercising voting rights attached to shares of the bank holding company;

(g) a person who is an agent or employee of Her Majesty in right of Canada or in right of a province;

(h) a minister of Her Majesty in right of Canada or in right of a province; and

(i) a person who is an agent or employee of the government of a foreign country or any political subdivision thereof.

2001, c. 9, s. 183.

751. A director of a bank holding company is not required to hold shares of the bank holding company.

2001, c. 9, s. 183.

752. No more than 15 per cent of the directors of a bank holding company may, at each director’s election or appointment, be employees of the bank holding company or a subsidiary of the bank holding company, except that up to four persons who are employees of the bank holding company or a subsidiary of the bank holding company may be directors of the bank holding company if those directors constitute not more than one half of the directors of the bank holding company.

2001, c. 9, s. 183.

753. (1) Subject to section 217, subsection 749(1) and section 756, the directors of a bank holding company shall, by by-law, determine the number of directors or the minimum and maximum number of directors, but no by-law that decreases the number of directors shortens the term of an incumbent director.

(2) A by-law made pursuant to subsection (1) that provides for a minimum and maximum number of directors may provide that the number of directors to be elected at any annual meeting of the shareholders be such number as is fixed by the directors prior to the annual meeting.

2001, c. 9, s. 183.

754. (1) Except where this Part or the by-laws of a bank holding company provide for cumulative voting, a bank holding company may, by by-law, provide that the directors be elected for terms of one, two or three years.

(2) A director elected for a term of one, two or three years holds office until the close of the first, second or third annual meeting of shareholders, as the case may be, following the election of the director.

(3) A director who is not elected for an expressly stated term of office ceases to hold office at the close of the next annual meeting of shareholders following the election of the director.

(4) It is not necessary that all directors elected at a meeting of shareholders hold office for the same term.

(5) If a by-law of a bank holding company provides that the directors be elected for a term of two or three years, it may also provide that the term of office of each director be for the whole of that term, or that, as nearly as may be, one half of the directors retire each year if the term is two years, and that one third of the directors retire each year if the term is three years.

(6) If a director of a bank holding company is elected or appointed for a term of more than one year, the bank holding company shall comply with subsection 749(2) and section 752 at each annual meeting of shareholders during the director’s term of office as if that director were elected or appointed on that date.

2001, c. 9, s. 183.

755. (1) Except where this Part or the by-laws of a bank holding company provide for cumulative voting, the persons, to the number authorized to be elected, who receive the greatest number of votes at an election of directors of a bank holding company shall be the directors thereof.

(2) If, at any election of directors referred to in subsection (1), two or more persons receive an equal number of votes and there are not sufficient vacancies remaining to enable all the persons receiving an equal number of votes to be elected, the directors who receive a greater number of votes or the majority of them shall, in order to complete the full number of directors, determine which of the persons so receiving an equal number of votes are to be elected.

2001, c. 9, s. 183.

756. (1) Where this Part or the by-laws provide for cumulative voting,

(a) there shall be a stated number of directors fixed by by-law and not a minimum and maximum number of directors;

(b) each shareholder entitled to vote at an election of directors has the right to cast a number of votes equal to the number of votes attached to the shares held by the shareholder multiplied by the number of directors to be elected, and the shareholder may cast all such votes in favour of one candidate or distribute them among the candidates in any manner;

(c) a separate vote of shareholders shall be taken with respect to each candidate nominated for director unless a resolution is passed unanimously permitting two or more persons to be elected by a single vote;

(d) if a shareholder has voted for more than one candidate without specifying the distribution of the votes among the candidates, the shareholder is deemed to have distributed the votes equally among the candidates for whom the shareholder voted;

(e) if the number of candidates nominated for director exceeds the number of positions to be filled, the candidates who receive the least number of votes shall be eliminated until the number of candidates remaining equals the number of positions to be filled;

(f) each director ceases to hold office at the close of the next annual meeting of shareholders following the director’s election;

(g) a director may be removed from office only if the number of votes cast in favour of a motion to remove the director is greater than the product of the number of directors required by the by-laws and the number of votes cast against the motion; and

(h) the number of directors required by the by-laws may be decreased only if the number of votes cast in favour of a motion to decrease the number of directors is greater than the product of the number of directors required by the by-laws and the number of votes cast against the motion.

(2) Where the aggregate of the voting shares beneficially owned by a person and any entities controlled by the person carries more than 10 per cent of the voting rights attached to all the outstanding voting shares of a bank holding company, the directors shall be elected by cumulative voting.

(3) Subsection (2) does not apply if all the voting shares of the bank holding company that are outstanding are beneficially owned by

(a) one person;

(b) one person and one or more entities controlled by that person; or

(c) one or more entities controlled by the same person.

(4) Subsection (2) does not apply to a widely held bank holding company with equity of five billion dollars or more or to a widely held bank holding company that controls a bank to which subsection 378(1) applies.

(5) Where this Part or the by-laws of a bank holding company provide for cumulative voting, the shareholders of the bank holding company shall

(a) at the first annual meeting of shareholders held not earlier than ninety days following the date that cumulative voting is required under subsection (2) or provided for in the by-laws, and

(b) at each succeeding annual meeting,

elect the stated number of directors to hold office until the close of the next annual meeting of shareholders following their election.

(6) Nothing in this Part precludes the holders of any class or series of shares of a bank holding company from having an exclusive right to elect one or more directors.

2001, c. 9, s. 183; 2005, c. 54, s. 104.

757. A director who has completed a term of office is, if otherwise qualified, eligible for re-election.

2001, c. 9, s. 183.

758. (1) If, immediately after the time of any purported election or appointment of directors, the board of directors would fail to comply with subsection 749(2) or section 752, the purported election or appointment of all persons purported to be elected or appointed at that time is void unless the directors, within forty-five days after the discovery of the non-compliance, develop a plan, approved by the Superintendent, to rectify the non-compliance.

(2) Where, at the close of a meeting of shareholders of a bank holding company, the shareholders have failed to elect the number or minimum number of directors required by this Part or the by-laws of a bank holding company, the purported election of directors at the meeting

(a) is valid if the directors purported to be elected and those incumbent directors, if any, whose terms did not expire at the close of the meeting, together constitute a quorum; or

(b) is void if the directors purported to be elected and those incumbent directors, if any, whose terms did not expire at the close of the meeting, together do not constitute a quorum.

2001, c. 9, s. 183.

759. (1) Notwithstanding subsections 754(2) and (3) and paragraphs 756(1)(f) and 760(1)(a), where subsection 758(1) or (2) applies at the close of any meeting of shareholders of a bank holding company, the board of directors shall, until their successors are elected or appointed, consist solely of

(a) where paragraph 758(2)(a) applies, the directors referred to in that paragraph; or

(b) where subsection 758(1) or paragraph 758(2)(b) applies, the persons who were the incumbent directors immediately before the meeting.

(2) Notwithstanding subsections 754(2) and (3) and paragraphs 756(1)(f) and 760(1)(a), where a plan to rectify the non-compliance referred to in subsection 758(1) has not been approved by the Superintendent by the end of the forty-five day period referred to in that subsection, the board of directors shall, until their successors are elected or appointed, consist solely of the persons who were the incumbent directors immediately before the meeting at which the purported election or appointment referred to in that subsection occurred.

(3) Where subsection (1) or (2) applies, the board of directors referred to in that subsection shall without delay call a special meeting of shareholders to fill the vacancies, where paragraph 758(2)(a) applies, or elect a new board of directors, where subsection 758(1) or paragraph 758(2)(b) applies.

(4) Where the directors fail to call a special meeting required by subsection (3), the meeting may be called by any shareholder.

2001, c. 9, s. 183.

760. (1) A director ceases to hold office

(a) at the close of the annual meeting at which the director’s term of office expires;

(b) when the director dies or resigns;

(c) when the director becomes disqualified under section 750 or ineligible to hold office pursuant to subsection 790(2);

(d) when the director is removed under section 761; or

(e) when the director is removed from office under section 963 or 964.

(2) The resignation of a director of a bank holding company becomes effective at the time a written resignation is sent to the bank holding company by the director or at the time specified in the resignation, whichever is later.

2001, c. 9, s. 183.

761. (1) Subject to paragraph 756(1)(g), the shareholders of a bank holding company may by resolution at a special meeting remove any director or all the directors from office.

(2) Where the holders of any class or series of shares of a bank holding company have the exclusive right to elect one or more directors, a director so elected may be removed only by a resolution at a meeting of the shareholders of that class or series.

(3) Subject to paragraphs 756(1)(b) to (e), a vacancy created by the removal of a director may be filled at the meeting of the shareholders at which the director is removed or, if not so filled, may be filled under section 765 or 766.

2001, c. 9, s. 183.

762. (1) A director who

(a) resigns,

(b) receives a notice or otherwise learns of a meeting of shareholders called for the purpose of removing the director from office, or

(c) receives a notice or otherwise learns of a meeting of directors or shareholders at which another person is to be appointed or elected to fill the office of director, whether because of the director’s resignation or removal or because the director’s term of office has expired or is about to expire,

is entitled to submit to the bank holding company a written statement giving the reasons for the resignation or the reasons why the director opposes any proposed action or resolution.

(2) Where a director resigns as a result of a disagreement with the other directors or the officers of a bank holding company, the director shall submit to the bank holding company and the Superintendent a written statement setting out the nature of the disagreement.

2001, c. 9, s. 183.

763. (1) A bank holding company shall without delay on receipt of a director’s statement referred to in subsection 762(1) relating to a matter referred to in paragraph 762(1)(b) or (c), or a director’s statement referred to in subsection 762(2), send a copy of it to each shareholder entitled to receive a notice of meetings and to the Superintendent, unless the statement is attached to a notice of a meeting.

(2) No bank holding company or person acting on its behalf incurs any liability by reason only of circulating a director’s statement in compliance with subsection (1).

2001, c. 9, s. 183.

764. The by-laws of a bank holding company may provide that a vacancy among the directors is to be filled only

(a) by a vote of the shareholders; or

(b) by a vote of the holders of any class or series of shares having an exclusive right to elect one or more directors if the vacancy occurs among the directors elected by the holders of that class or series.

2001, c. 9, s. 183.

765. (1) Despite section 772 but subject to subsection (2) and sections 764 and 766, a quorum of directors may fill a vacancy among the directors except a vacancy resulting from a change in the by-laws by which the number or the minimum or maximum number of directors is increased or from a failure to elect the number or minimum number of directors provided for in the by-laws.

(2) Notwithstanding sections 764 and 772, where by reason of a vacancy the number of directors or the composition of the board of directors fails to meet any of the requirements of section 749 or section 752, the directors who, in the absence of any by-law, would be empowered to fill that vacancy shall do so forthwith.

2001, c. 9, s. 183; 2005, c. 54, s. 105.

766. Notwithstanding section 772, where the holders of any class or series of shares of a bank holding company have an exclusive right to elect one or more directors and a vacancy occurs among those directors, then, subject to section 764,

(a) the remaining directors elected by the holders of that class or series of shares may fill the vacancy except one resulting from an increase in the number or the minimum or maximum number of directors for that class or series or from a failure to elect the number or minimum number of directors provided for in the by-laws for that class or series;

(b) if there are no such remaining directors and, by reason of the vacancy, the number of directors or the composition of the board of directors fails to meet any of the requirements of section 749 or section 752, the other directors may fill that vacancy; and

(c) if there are no such remaining directors and paragraph (b) does not apply, any holder of shares of that class or series may call a meeting of the holders thereof for the purpose of filling the vacancy.

2001, c. 9, s. 183; 2005, c. 54, s. 106.

767. Unless the by-laws otherwise provide, a director elected or appointed to fill a vacancy holds office for the unexpired term of the director’s predecessor in office.

2001, c. 9, s. 183.

768. (1) The directors of a bank holding company may appoint one or more additional directors where the by-laws of the bank holding company allow them to do so and the by-laws determine the minimum and maximum numbers of directors.

(2) A director appointed under subsection (1) holds office for a term expiring not later than the close of the next annual meeting of shareholders of the bank holding company.

(3) The total number of directors appointed under subsection (1) may not exceed one third of the number of directors elected at the previous annual meeting of shareholders of the bank holding company.

2001, c. 9, s. 183.

769. (1) The directors shall meet at least four times during each financial year.

(2) The directors may meet at any place unless the by-laws provide otherwise.

(3) The notice for the meetings must be given as required by the by-laws.

2001, c. 9, s. 183.

770. (1) A notice of a meeting of directors shall specify each matter referred to in section 785 that is to be dealt with at the meeting but, unless the by-laws otherwise provide, need not otherwise specify the purpose of or the business to be transacted at the meeting.

(2) A director may in any manner waive notice of a meeting of directors and the attendance of a director at a meeting of directors is a waiver of notice of that meeting except where the director attends the meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called.

(3) Notice of an adjourned meeting of directors is not required to be given if the time and place of the adjourned meeting were announced at the original meeting.

2001, c. 9, s. 183.

771. (1) Subject to section 772, the number of directors referred to in subsection (2) constitutes a quorum at any meeting of directors or a committee of directors and, notwithstanding any vacancy among the directors, a quorum of directors may exercise all the powers of the directors.

(2) The number of directors constituting a quorum at any meeting of directors or a committee of directors shall be

(a) a majority of the minimum number of directors required by this Part for the board of directors or a committee of directors; or

(b) such greater number of directors than the number calculated pursuant to paragraph (a) as may be established by the by-laws of the bank holding company.

(3) Any director present at a meeting of directors who is not present at any particular time during the meeting for the purposes of subsection 790(1) shall be considered as being present for the purposes of this section.

2001, c. 9, s. 183.

772. (1) The directors of a bank holding company shall not transact business at a meeting of directors unless

(a) in the case of a bank holding company that is a subsidiary of a foreign bank, at least one half of the directors present are resident Canadians; or

(b) in any other case, a majority of the directors present are resident Canadians.

(2) Notwithstanding subsection (1), the directors of a bank holding company may transact business at a meeting of directors or of a committee of directors without the required proportion of directors present who are resident Canadians if

(a) a director who is a resident Canadian unable to be present approves, in writing or by telephonic, electronic or other communications facilities, the business transacted at the meeting; and

(b) there would have been present the required proportion of directors who are resident Canadians had that director been present at the meeting.

2001, c. 9, s. 183.

773. (1) Subject to the by-laws of a bank holding company, a meeting of directors or of a committee of directors may be held by means of such telephonic, electronic or other communications facilities as permit all persons participating in the meeting to communicate adequately with each other during the meeting.

(2) A director participating in a meeting by any means referred to in subsection (1) is deemed for the purposes of this Part to be present at that meeting.

2001, c. 9, s. 183.

774. (1) A resolution in writing signed by all the directors entitled to vote on that resolution at a meeting of directors is as valid as if it had been passed at a meeting of directors.

(2) A copy of the resolution referred to in subsection (1) shall be kept with the minutes of the proceedings of the directors.

(3) A resolution in writing signed by all the directors entitled to vote on that resolution at a meeting of a committee of directors, other than a resolution of the audit committee in carrying out its duties under subsection 782(3), is as valid as if it had been passed at a meeting of that committee.

(4) A copy of the resolution referred to in subsection (3) shall be kept with the minutes of the proceedings of that committee.

2001, c. 9, s. 183.

775. (1) A director of a bank holding company who is present at a meeting of directors or a committee of directors is deemed to have consented to any resolution passed or action taken at that meeting unless

(a) the director requests that the director’s dissent be entered or the director’s dissent is entered in the minutes of the meeting;

(b) the director sends a written dissent to the secretary of the meeting before the meeting is adjourned; or

(c) the director sends the director’s dissent by registered mail or delivers it to the head office of the bank holding company immediately after the meeting is adjourned.

(2) A director of a bank holding company who votes for or consents to a resolution is not entitled to dissent under subsection (1).

(3) A director of a bank holding company who is not present at a meeting at which a resolution is passed or action taken is deemed to have consented thereto unless, within seven days after the director becomes aware of the resolution, the director

(a) causes the director’s dissent to be placed with the minutes of the meeting; or

(b) sends the director’s dissent by registered mail or delivers it to the head office of the bank holding company.

2001, c. 9, s. 183.

776. (1) A bank holding company shall keep a record of the attendance at each meeting of directors and each committee meeting of directors.

(2) A bank holding company shall attach to the notice of each annual meeting it sends to its shareholders a statement showing, in respect of the financial year immediately preceding the meeting, the total number of directors’ meetings and directors’ committee meetings held during the financial year and the number of those meetings attended by each director.

2001, c. 9, s. 183.

777. (1) Where in the opinion of the Superintendent it is necessary, the Superintendent may, by notice in writing, require a bank holding company to hold a meeting of directors of the bank holding company to consider the matters set out in the notice.

(2) The Superintendent may attend and be heard at a meeting referred to in subsection (1).

2001, c. 9, s. 183.

778. (1) Unless this Part otherwise provides, the directors of a bank holding company may by resolution make, amend or repeal any by-law that regulates the business or affairs of the bank holding company.

(2) The directors shall submit a by-law, or an amendment to or a repeal of a by-law, that is made under subsection (1) to the shareholders at the next meeting of shareholders, and the shareholders may, by resolution, confirm or amend the by-law, amendment or repeal.

(3) Unless this Part otherwise provides, a by-law, or an amendment to or a repeal of a by-law, is effective from the date of the resolution of the directors under subsection (1) until it is confirmed, confirmed as amended or rejected by the shareholders under subsection (2) or until it ceases to be effective under subsection (4) and, where the by-law is confirmed, or confirmed as amended, it continues in effect in the form in which it was so confirmed.

(4) If a by-law, or an amendment to or a repeal of a by-law, is rejected by the shareholders, or is not submitted to the shareholders by the directors as required under subsection (2), the by-law, amendment or repeal ceases to be effective from the date of its rejection or the date of the next meeting of shareholders, as the case may be, and no subsequent resolution of the directors to make, amend or repeal a by-law having substantially the same purpose or effect is effective until it is confirmed, or confirmed as amended, by the shareholders.

2001, c. 9, s. 183.

779. A shareholder entitled to vote at an annual meeting of shareholders may, in accordance with sections 732 and 733, make a proposal to make, amend or repeal a by-law.

2001, c. 9, s. 183.

780. (1) Any matter that, immediately prior to the day a body corporate is continued as a bank holding company, was provided for in the incorporating instrument of the body corporate, and that, under this Part, would be provided for in the by-laws of a bank holding company, is deemed to be provided for in the by-laws of the bank holding company.

(2) Where a by-law of the bank holding company made in accordance with sections 778 and 779 amends or repeals any matter referred to in subsection (1), the by-law prevails.

2001, c. 9, s. 183.

781. The directors of a bank holding company may appoint from their number, in addition to the committees referred to in subsection 747(2), such other committees as they deem necessary and, subject to section 785, delegate to those committees such powers of the directors, and assign to those committees such duties, as the directors consider appropriate.

2001, c. 9, s. 183.

782. (1) The audit committee of a bank holding company shall consist of at least three directors.

(2) None of the members of the audit committee may be officers or employees of the bank holding company or any of its subsidiaries.

(3) The audit committee of a bank holding company shall

(a) review the annual statement of the bank holding company before the annual statement is approved by the directors;

(b) review such returns of the bank holding company as the Superintendent may specify;

(c) require the management of the bank holding company to implement and maintain appropriate internal control procedures;

(d) review, evaluate and approve those procedures;

(e) review such investments and transactions that could adversely affect the well-being of the bank holding company as the auditor or any officer of the bank holding company may bring to the attention of the committee;

(f) meet with the auditor to discuss the annual statement and the returns and transactions referred to in this subsection; and

(g) meet with the chief internal auditor of the bank holding company, or the officer or employee of the bank holding company acting in a similar capacity, and with management of the bank holding company, to discuss the effectiveness of the internal control procedures established for the bank holding company.

(4) In the case of the annual statement and returns of a bank holding company that under this Part must be approved by the directors of the bank holding company, the audit committee of the bank holding company shall report thereon to the directors before the approval is given.

(5) The audit committee of a bank holding company may call a meeting of the directors of the bank holding company to consider any matter of concern to the committee.

2001, c. 9, s. 183.

783. The directors of a bank holding company shall appoint from their number a chief executive officer who must be ordinarily resident in Canada and, subject to section 785, may delegate to that officer any of the powers of the directors.

2001, c. 9, s. 183.

784. (1) The directors of a bank holding company may, subject to the by-laws, designate the offices of the bank holding company, appoint officers thereto, specify the duties of those officers and delegate to them powers, subject to section 785, to manage the business and affairs of the bank holding company.

(2) Subject to section 752, a director of a bank holding company may be appointed to any office of the bank holding company.

(3) Two or more offices of a bank holding company may be held by the same person.

2001, c. 9, s. 183.

785. The directors of a bank holding company may not delegate any of the following powers, namely, the power to

(a) submit to the shareholders a question or matter requiring the approval of the shareholders;

(b) fill a vacancy among the directors or a committee of directors or in the office of the auditor of the bank holding company;

(c) issue or cause to be issued securities except in the manner and on terms authorized by the directors;

(d) declare a dividend;

(e) authorize the redemption or other acquisition by the bank holding company pursuant to section 715 of shares issued by the bank holding company;

(f) authorize the payment of a commission on a share issue;

(g) approve a management proxy circular;

(h) except as provided in this Part, approve the annual statement of the bank holding company and any other financial statements issued by the bank holding company; or

(i) adopt, amend or repeal by-laws.

2001, c. 9, s. 183.

786. (1) Subject to this section and the by-laws, the directors of a bank holding company may fix the remuneration of the directors, officers and employees of the bank holding company.

(2) No remuneration shall be paid to a director as director until a by-law fixing the aggregate of all amounts that may be paid to all directors in respect of directors’ remuneration during a fixed period of time has been confirmed by special resolution.

2001, c. 9, s. 183.

787. (1) An act of a director or an officer of a bank holding company is valid notwithstanding a defect in the director’s qualification or an irregularity in the director’s election or in the appointment of the director or officer.

(2) An act of the board of directors of a bank holding company is valid notwithstanding a defect in the composition of the board or an irregularity in the election of the board or in the appointment of a member of the board.

2001, c. 9, s. 183.

788. A director of a bank holding company is entitled to attend and to be heard at every meeting of shareholders.

2001, c. 9, s. 183.

789. (1) A director or an officer of a bank holding company who

(a) is a party to a material contract or proposed material contract with the bank holding company,

(b) is a director or an officer of any entity that is a party to a material contract or proposed material contract with the bank holding company, or

(c) has a material interest in any person who is a party to a material contract or proposed material contract with the bank holding company

shall disclose in writing to the bank holding company or request to have entered in the minutes of the meetings of directors the nature and extent of that interest.

(2) The disclosure required by subsection (1) shall be made, in the case of a director,

(a) at the meeting of directors at which a proposed contract is first considered;

(b) if the director was not then interested in a proposed contract, at the first meeting after the director becomes so interested;

(c) if the director becomes interested after a contract is made, at the first meeting after the director becomes so interested; or

(d) if a person who is interested in a contract later becomes a director, at the first meeting after that person becomes a director.

(3) The disclosure required by subsection (1) shall be made, in the case of an officer who is not a director,

(a) forthwith after the officer becomes aware that a proposed contract is to be considered or a contract has been considered at a meeting of directors;

(b) if the officer becomes interested after a contract is made, forthwith after the officer becomes so interested; or

(c) if a person who is interested in a contract later becomes an officer, forthwith after the person becomes an officer.

(4) If a material contract or proposed material contract is one that, in the ordinary course of business of the bank holding company, would not require approval by the directors or shareholders, a director or an officer referred to in subsection (1) shall disclose in writing to the bank holding company or request to have entered in the minutes of meetings of directors the nature and extent of the director’s or officer’s interest forthwith after the director or officer becomes aware of the contract or proposed contract.

2001, c. 9, s. 183.

790. (1) Where subsection 789(1) applies to a director in respect of a contract, the director shall not be present at any meeting of directors while the contract is being considered at the meeting or vote on any resolution to approve the contract unless the contract is

(a) an arrangement by way of security for money lent to or obligations undertaken by the director for the benefit of the bank holding company or a subsidiary of the bank holding company;

(b) a contract relating primarily to the director’s remuneration as a director or an officer, employee or agent of the bank holding company or a subsidiary of the bank holding company or an entity controlled by the bank holding company or an entity in which the bank holding company has a substantial investment;

(c) a contract for indemnity under section 799 or for insurance under section 800; or

(d) a contract with an affiliate of the bank holding company.

(2) Any director who knowingly contravenes subsection (1) ceases to hold office as director and is not eligible, for a period of five years after the date on which the contravention occurred, for election or appointment as a director of any bank holding company, any insurance holding company or any financial institution that is incorporated or formed by or under an Act of Parliament.

(3) An act of the board of directors of a bank holding company, or of a committee of the board of directors, is not invalid because a person acting as a director had ceased under subsection (2) to hold office as a director.

2001, c. 9, s. 183.

791. For the purposes of subsection 789(1), a general notice to the directors by a director or an officer declaring that the director or officer is a director or officer of an entity, or has a material interest in a person, and is to be regarded as interested in any contract made with that entity or person, is a sufficient declaration of interest in relation to any contract so made.

2001, c. 9, s. 183.

792. A material contract between a bank holding company and one or more of its directors or officers, or between a bank holding company and another entity of which a director or an officer of the bank holding company is a director or an officer or between a bank holding company and a person in which the director or officer has a material interest, is neither void nor voidable

(a) by reason only of that relationship, or

(b) by reason only that a director with an interest in the contract is present at or is counted to determine the presence of a quorum at the meeting of directors or the committee of directors that authorized the contract,

if the director or officer disclosed the interest in accordance with subsection 789(2), (3) or (4) or section 791 and the contract was approved by the directors or the shareholders and it was reasonable and fair to the bank holding company at the time it was approved.

2001, c. 9, s. 183.

793. Where a director or an officer of a bank holding company fails to disclose an interest in a material contract in accordance with sections 789 and 791, a court may, on the application of the bank holding company or a shareholder of the bank holding company, set aside the contract on such terms as the court thinks fit.

2001, c. 9, s. 183.