Mutual Company (Life Insurance) Conversion Regulations (SOR/99-128)

12 (1) Subject to subsection (2), a converting company shall not provide any director, officer or employee of the company with a fee, compensation or any other consideration in relation to the conversion of the company, other than

• (a) the regular compensation provided to the person in that person’s capacity as a director, officer or employee of the company; and

• (b) any benefits provided to the person as an eligible policyholder.

(2) A converting company may provide fees, compensation or any other consideration to an entity with which a director, officer or employee of the company is associated pursuant to a contract for services in respect of the conversion that was entered into by the company with the entity on terms and conditions that are at least as favourable to the company as market terms and conditions, as defined in subsection 534(2) of the Act.