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| Loans,
investments
and
guarantees
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14. (1) The Bank may make loans to, or
investments in, any person, or give guarantees
in relation to any person.
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| How loans,
etc., may be
made
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(2) The loans, investments and guarantees
may be made or given directly, through
arrangements with other financial institutions
or by the Bank as a member of a financing
syndicate.
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| Criteria for
making loans,
etc.
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(3) The loans, investments and guarantees
may be made or given only where, in the
opinion of the Board or any committee or
officer designated by the Board,
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(a) the person is engaged, or is about to
engage, in an enterprise in Canada;
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(b) the amount invested, or to be invested,
in the enterprise by persons other than the
Bank and the character of the investment
are such that the Bank may reasonably
expect that those persons will have a
continuing commitment to the enterprise;
and
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(c) the enterprise may reasonably be
expected to prove successful.
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| Complementa
ry to
commercial
financial
institutions
|
(4) The loans, investments and guarantees
are to fill out or complete services available
from commercial financial institutions.
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| Acquiring and
dealing with
property
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(5) In any circumstances where the Bank
may make a loan or investment to a person, or
give a guarantee in relation to a person, under
this section, the Bank may
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(a) purchase or otherwise acquire real or
personal property, including accounts
receivable; and
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(b) subject to any right of redemption that
may exist, hold, lease to the person or
subsequently sell, dispose of or otherwise
deal with the property.
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| Security
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15. (1) The Bank may
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(a) acquire and hold security or a security
interest of any kind and in any form for the
due discharge of obligations under a loan,
investment, guarantee or agreement that it
makes or gives;
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(b) surrender or reconvey the security or
security interest and acquire and hold, in
exchange, security or a security interest of
any kind and in any form;
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(c) realize the security or security interest
made, acquired or held by it on the loan,
investment, guarantee or agreement; and
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(d) exchange, lease, sell, assign, convey or
otherwise dispose of the loan, investment,
guarantee, agreement, security or security
interest.
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| Additional
security
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(2) Without limiting the generality of the
powers of the Bank under this section, the
Bank may, for the due discharge of the
obligations referred to in paragraph (1)(a),
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(a) acquire and hold a warehouse receipt or
bill of lading as security; or
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(b) take security on goods, wares and
merchandise in the same form and manner
as security on such property may be taken
by a bank under section 427 of the Bank Act.
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| Warehouse
receipts and
bills of lading
|
(3) Where the Bank acquires and holds a
warehouse receipt or bill of lading as security,
subsections 428(1), (2), (7), (8), (9) and (12)
and 435(2) and section 436 of the Bank Act
apply, with any modifications that the
circumstances require, as if the Bank were a
bank under that Act.
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| Goods, wares
and
merchandise
|
(4) Where the Bank takes security on goods,
wares and merchandise, section 427 and
subsections 428(1), (2), (7), (8), (9) and (12)
of the Bank Act apply, with any modifications
that the circumstances require, as if the Bank
were a bank under that Act.
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| Deemed loan
or advance
|
(5) Where the Bank issues a guarantee or
otherwise makes a promise to effect a
payment, the Bank is deemed to lend money
or make an advance for the purposes of
subsections (3) and (4) and the provisions of
the Bank Act that they refer to.
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| Acquisition of
loans
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16. The Bank may acquire and deal with as
its own any loan, investment or guarantee
made or given by another person if
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(a) the loan, investment or guarantee would
meet the Bank's eligibility criteria in
subsection 14(3); or
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(b) it is part of a block of loans, investments
or guarantees the majority of which meet
those criteria.
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| Agreements
|
17. The Bank may provide, or enter into
agreements for the provision of,
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(a) business planning services;
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(b) management counselling and training,
including seminars, conferences and
meetings; and
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| Borrowing
powers
|
18. (1) The Bank may borrow money by any
means, including issuing and selling or
pledging debt obligations of the Bank.
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| Debt
obligations
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(2) The debt obligations may, in accordance
with their terms, be subordinated to secured or
unsecured indebtedness of the Bank and
liability under them may be limited to the
remaining assets of the Bank, after payment of
indebtedness ranking prior to the debt
obligations.
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| Investment
powers
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(3) The Bank may invest any money
administered by it
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(a) in debentures, bonds, stocks, bankers'
acceptances or other securities of or
guaranteed by any member of the Canadian
Payments Association, or the government
of Canada or a province; or
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(b) in any other manner that the Minister of
Finance may approve.
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| Financial
management
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(4) The Bank may enter into any transaction
for the purpose of reducing risk in the financial
management of the Bank, including any
financial instrument or agreement whose
object is the management of financial risks,
such as interest rate or currency exchange
agreements, options, futures contracts and any
other similar agreements.
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| Pledging
assets
|
(5) The Bank may pledge any of its assets or
give deposits as security for any debt
obligations issued by the Bank or as security
for the due performance of its obligations
under any financial management agreement.
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| Non-applicati
on of certain
provisions
|
(6) For greater certainty, this section has
effect notwithstanding sections 100 and 101 of
the Financial Administration Act.
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| Loans to the
Bank from
Consolidated
Revenue Fund
|
19. At the request of the Bank, the Minister
of Finance may, out of the Consolidated
Revenue Fund, lend money to the Bank on any
terms and conditions that the Minister of
Finance may fix.
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| Agreements
|
20. The Bank may enter into agreements
with, and act as agent for, any department or
agency of the government of Canada or a
province, or any other body or person, for the
provision of services or programs to, on behalf
of or jointly with that body or person and,
subject to subsection 14(3), may deliver
financial assistance on their behalf under the
agreement.
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| Entrepreneur-
ship programs
|
21. The Bank may carry out duties or
functions that may be assigned to it by the
Designated Minister in relation to the
administration of any program supporting
Canadian entrepreneurship, to the extent that
it is able to recover the costs of carrying out the
duties or functions.
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| Powers
|
22. The Bank may
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(a) accept deposits as security for the due
performance of any arrangement or
agreement with the Bank;
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(b) determine and charge interest and any
other form of compensation for services
provided by the Bank in the exercise of its
powers under this Act;
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(c) procure the incorporation, dissolution or
amalgamation of subsidiaries and acquire
or dispose of any shares in them;
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(d) acquire and dispose of any interest in
any entity by any means;
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(e) acquire, hold, exchange, lease, sell or
otherwise dispose of any interest in real or
personal property and retain and use the
proceeds of disposition; and
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(f) generally, do all other things that are
incidental or conducive to attaining the
purpose of this Act and the exercise of the
powers of the Bank.
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| Authorized
capital
|
23. (1) The authorized capital of the Bank
consists of an unlimited number of common
shares with a par value of $100 each and an
unlimited number of preferred shares without
par value, but the paid-in capital of the Bank,
together with any contributed surplus relating
to it and any proceeds referred to in paragraph
30(2)(d) that have been prescribed as equity,
must not at any time exceed $1.5 billion.
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| Issuance of
shares
|
(2) The shares of the Bank may be issued
only to the Designated Minister to be held in
trust for the Crown.
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| Subscription
by Designated
Minister
|
(3) Where the Board recommends that the
Designated Minister subscribe for unissued
shares of the Bank, the Designated Minister
may, if the Minister of Finance concurs,
subscribe for the amount that the Designated
Minister considers desirable.
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| Payment out
of
Consolidated
Revenue Fund
|
(4) The amount of the subscription is to be
paid to the Bank out of the Consolidated
Revenue Fund at any time and in any amount
that the Board may require.
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| Rights of
common
shares
|
24. (1) The rights conferred by common
shares include
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(a) the right to vote at any meeting of
shareholders;
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(b) the right to receive dividends declared
on common shares; and
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(c) the right to receive the remaining
property of the Bank on dissolution.
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| Rights of
preferred
shares
|
(2) The rights conferred by preferred shares
of any class or series are limited as follows:
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(a) the holders of preferred shares are not
entitled to vote at meetings of shareholders;
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(b) dividends, once declared, are limited to
the rate, whether fixed or variable,
cumulative or non-cumulative, that may be
provided for in the by-laws; and
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(c) participation in the remaining property
of the Bank on dissolution is limited to the
consideration paid for the shares plus any
dividend accumulated or declared and
unpaid, but no more.
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| Declaration
and payment
of dividends
|
25. (1) In any financial year of the Bank, it
may declare and pay to the shareholders of the
Bank any dividends out of the retained
earnings or surplus account of the Bank.
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| Limitation
|
(2) The Bank may not declare or pay a
dividend if there are reasonable grounds for
believing that
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(a) the Bank is, or would after the payment
be, unable to pay its liabilities as they
become due; or
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(b) the realizable value of the Bank's assets
would, after the payment, be less than the
aggregate of its liabilities and paid-up
capital of all classes.
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| Participation
in dividends
|
(3) If any cumulative dividends or amounts
payable on return of capital in respect of a
series of shares are not paid in full, the shares
of all series of the same class participate
rateably in respect of accumulated dividends
and the return of capital.
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| Cancellation
or restoration
of shares
|
26. Shares, or fractions of them, of any class
or series of shares issued by the Bank and
purchased, redeemed or otherwise acquired
by it must be cancelled or, if the number of
them is limited and the by-laws so authorize,
they may be restored to the status of
authorized but unissued shares of that class or
series.
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| By-laws
relating to
shares
|
27. Subject to the approval of the Governor
in Council on the recommendation of the
Minister of Finance, the Board may make
by-laws
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(a) setting out the rights, privileges,
restrictions and conditions attaching to
preferred shares, creating one or more
additional classes of preferred shares and
generally determining the rights and
obligations of the holders of preferred
shares, including
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(i) limiting the right of the shareholders
to specific dividends or repayments,
whether fixed or variable,
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(ii) authorizing the purchase or redemp
tion of the shares by the Bank, either at
the Bank's option or at the shareholder's
request, and
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(iii) limiting or extending the rights of the
shareholders in any other way;
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(b) authorizing the issue of any class of
shares in one or more series and authorizing
the Board to fix, by resolution, the
maximum number of shares in each series
and to determine the designation, rights,
privileges, restrictions and conditions
attaching to the shares of each series,
subject to any limitations set out in the
by-law;
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(c) determining a maximum number of
shares with respect to any class or series of
preferred shares;
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(d) changing authorized shares without par
value, whether issued or not, into shares
with a par value and changing authorized
shares with a par value, whether issued or
not, into shares without par value;
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(e) consolidating or subdividing shares;
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(f) converting shares of any class into shares
of another class; and
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(g) increasing or reducing the issued share
capital or any part of it, with or without
distribution of paid-in capital or reduction
of liability on any of the shares.
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| Hybrid capital
instruments
|
28. (1) With the approval of the Governor in
Council on the recommendation of the
Minister of Finance, the Bank may issue to
persons other than the Crown hybrid capital
instruments prescribed, in whole or in part, as
equity of the Bank under paragraph 30(2)(d).
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| Crown not
liable
|
(2) The Crown is not in any way liable for
payment of amounts owing under an
instrument issued under subsection (1).
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| Instruments
not shares
|
(3) For greater certainty, an instrument
issued under subsection (1) is not a share
within the meaning of Part X of the Financial
Administration Act.
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| Appropriation
s
|
29. Moneys may be appropriated by
Parliament and paid out to the Bank for use in
any of its activities.
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