Article 12: Protection of Directors and Officers

12.1 Limitation of Liability

(a) Absent the failure to act honestly and in good faith in the performance of the duties of office, and save as may be otherwise provided in the Act or the By-law, the Society shall indemnify a Director or Officer of the Society, a former Director or Officer of the Society, or another individual who acts or acted at the Society’s request as a Director or Officer, or an individual acting in a similar capacity, of another entity, and his or her heirs and legal representatives against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgement, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with the Society or other entity.

(b) The Society may not indemnify an individual unless the individual:

(i) acted honestly and in good faith with a view to the best interests of the Society, or, as the case may be, to the best interests of the other entity for which the individual acted as Director or Officer in a similar capacity at the Society’s request; and

(ii) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that their conduct was lawful.

12.2 Advance of Costs

(a) Subject to Section 12.1, the Society shall advance moneys to a Director, Officer or other individual for the costs, charges and expenses of a proceeding referred to in Section 12.1. The individual shall repay the moneys if the individual does not fulfil the conditions of Section 12.1.

(b) Such advancement will only be effective:

(i) upon the exhaustion of all available and collectible insurance provided to the Director, Officer or other individual by the Society inclusive of whatever valid and collectible insurance has been collected; and

(ii) provided that the Director, Officer or other individual has carried out all duties assigned to such person which are subject of the claim in complete good faith so as to comply with the conditions of the insurance policy concerning entitlement to coverage.

12.3 Derivative Actions

The Society shall, with the approval of a court, indemnify an individual referred to in Section 12.1, or advance moneys under Section 12.2 in respect of an action by or on behalf of the Society or other entity to procure a judgement in its favour, to which the individual is made a party because of the individual’s association with the Society or other entity as described in Section 12.1 against all costs, charges and expenses reasonably incurred by the individual in connection with such action, if the individual fulfils the conditions set out in Section 12.1.

12.4 No Restriction

The Society will also indemnify the individuals referred to in Section 12.1 in any other circumstances that the Act permits or requires. Nothing in the By-law will limit the right of any person entitled to indemnity to claim indemnity apart from the provision of the By-law.

12.5 Insurance

(a) The Society shall, at all times, maintain in force such Director’s and Officer’s liability insurance as may be approved by the Board.

(b) No coverage shall be provided for any liability relating to a failure to act honestly and in good faith with a view to the best interests of the Society.