Legal Terms and Conditions for Government of Canada Domestic Treasury Bills
March 30, 2015
Domestic Treasury Bills (the “Bills”) are securities issued by the Government of Canada pursuant to Part IV of the Canadian Financial Administration Act. In addition to these general terms and conditions (the “Legal Terms and Conditions”), the Bills are subject to the characteristics (the “Specific Terms”) indicated by the associated International Securities Identification Number (the “ISIN”).
The Bills constitute direct, unsecured, and unconditional obligations of Her Majesty in right of Canada (“Canada”). Payments of the par amount are direct charges on, and payable out of the Consolidated Revenue Fund of Canada. The Bills rank pari passu in all respects amongst themselves and with all other securities issued by Canada and presently outstanding.
The Bills are not redeemable prior to the maturity date stated in the Specific Terms (“Maturity”). Canada will redeem the Bills at the par amount on Maturity. The Bills will not bear interest either before or after Maturity.
The Bonds are registered only in the name of CDS & Co., as nominee of CDS Clearing and Depository Services Inc. ("CDS"), and are held by CDS in its record entry securities clearing and depository system. The Bonds are not represented by physical certificates but only by book entries in the records maintained by CDS. Interests in the Bonds held by participants in the CDS system (each, a “CDS Participant”) are represented through book entries in accounts established and maintained by CDS for each such CDS Participant, in accordance with the practices, rules, and agreements of CDS. CDS Participants may in turn maintain on behalf of other persons accounts in which such persons’ interests in the Bonds may be recorded.
Canada may treat CDS & Co. as the absolute owner of the Bills for the purpose of receiving payment and for all other purposes. No beneficial owner of Bills (each, a “Bill Owner”) will be shown on the records maintained by CDS other than a Bill Owner who is a CDS Participant. The Bills must be purchased, transferred, or sold directly or indirectly by or through a CDS Participant and all rights of Bill Owners must be exercised through such CDS Participant.
Except in the limited circumstances described below, Bill Owners will not be entitled to have Bills registered in their names, will not receive or be entitled to receive physical certificates in definitive form representing Bills, and will not be considered registered holders of Bills. Neither Canada, nor any registrar, transfer agent, or paying agent duly appointed will have any responsibility or liability for maintaining, supervising, or reviewing any records of CDS relating to any interests in the Bills or for any aspect of the records of CDS relating to payments made by CDS on account of such interests.
The Bills constituting a particular issuance will be exchangeable, in whole but not in part, for Bills in definitive form registered in the name of a Bill Owner other than CDS or its nominee only if (i) CDS notifies Canada that it is unwilling or unable to continue as depository in connection with the particular issuance or (ii) Canada notifies CDS that it desires to issue the Bills in definitive form. If, at any time, the Minister of Finance (the "Minister") determines that it is no longer practicable or appropriate to use CDS for the transfer and settlement of the interests of Bill Owners in the Bills, the Minister may select another depository for these purposes, or may direct that definitive individual certificates be made available to Bill Owners in integral multiples of $1,000.
Payment of the par amount will be made to CDS & Co., as nominee of CDS in Canadian dollars in accordance with the customary method for making payments in Canadian dollars. Payment by Canada of any amount owing in respect of the Bills to CDS & Co. in accordance with the Legal Terms and Conditions and the Specific Terms shall constitute a valid discharge, to the extent of the payment made, of Canada's obligations.
If the payment of the par amount falls due on a day which is not a Business Day, payment thereof shall be made on the next succeeding Business Day and no further interest or other payment shall be paid in respect of the delay in such payment. "Business Day" means a day other than a Saturday or a Sunday or a day recognized as a holiday by the laws of Canada or of the Province of Ontario.
Canada may make amendments to the Legal Terms and Conditions where the Minister, acting reasonably, determines that the amendment would not materially adversely affect the interest of the Bill Owners.Â
Notice of any amendment shall be given forthwith to the Bill Owners by publishing such notice on the Bank of Canada website.
Canada may, at any time, purchase Bills in the open market, by tender, or by private contract at any price. Such Bills purchased by Canada may be cancelled and Canada shall notify CDS & Co. of the cancellation. The aggregate par amount of the particular issuance shall be reduced by the amount of the cancellation.
The Bills shall be governed by and construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.
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