Part 2
14 Loans
shareholders or directors or give, whether directly or indirectly and
whether by means of a loan, guarantee, the provision of security or
otherwise, any financial assistance for the purpose of or in
connection with a purchase made or to be made by any person of
any shares in the company.
(2) Nothing in subsection (1) shall be taken to prohibit
(a) the lending of money by the company in the ordinary course
of its business when the lending of money is part of the
ordinary business of the company,
(b) the making by a company of loans to persons who are, in
good faith, in the employment of the company, whether
directors or otherwise, with a view to enabling or assisting
those persons to erect or purchase dwelling houses for their
own occupation,
(c) the provision by a company , in accordance with any scheme
for the time being in force, of money for the purchase by
trustees of fully paid up shares in the capital stock of the
company, to be held by or for the benefit of employees of
the company, including any director holding a salaried
employment or office in the company, or
(d) the making by a company of loans to persons in the
employment of the company, including directors holding
salaried employment, with a view to enabling those persons
to purchase fully paid-up shares in the capital stock of the
company, to be held by themselves by way of beneficial
ownership.
(3) If a loan is made by a public company in contravention of
subsection (1), all directors and officers of the company making it
or assenting to it are, until repayment of the loan, jointly and
severally liable to the company and any person injured for any loss,
damage or costs that the company or person sustained or incurred
by reason of the contravention of subsection (1).
RSA 2000
(4) Notwithstanding subsection (3),
(a) the liability of the director s and officers of a company under
this section is limited to the amount of the loan made in
contravention of subsection (1) with interest at the rate, if
any, stipulated for in the loan, and
(b) a director shall not be held liable for a contravention of
subsection (1) if the director proves that the contravention
was not due to any misconduct or negligence on the
director's part.
(5) Proceedings to recover any loss, damage or costs sustained or
incurred by reason of a contravention of subsection (1) may not be
commenced after the expiration of 2 years from the date on which
the loss, damage or costs were sustained or incurred.
RSA 1970 c60 s14