INCORPORATION BY REFERENCE OF CERTAIN DOCUMENTS
This prospectus supplement incorporates documents by reference that are not presented in or delivered with this prospectus supplement. This is
known as incorporation by reference. The following documents, which have been filed by CPRL with the SEC are incorporated by reference into this prospectus supplement:
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(a)
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CPRLs Annual Report on Form
10-K
for the year ended December 31, 2017 (filed on February 16, 2018);
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(b)
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Amendment No. 1 to CPRLs Annual Report on Form
10-K
for the year ended December 31, 2017 (filed on April 5, 2018);
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(c)
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CPRLs Quarterly Report on Form
10-Q
for the quarter ended March 31, 2018 (filed on April 19, 2018);
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(d)
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CPRLs Current Reports on Form
8-K,
filed on January 24, 2018, February 2, 2018, February 9, 2018, February 15, 2018, February 15, 2018,
February 16, 2018, February 20, 2018, March 1, 2018, March 7, 2018, March 9, 2018, March 16, 2018, March 16, 2018, April 16, 2018, April 19, 2018, April 23, 2018, May 1, 2018, May 3, 2018,
May 11, 2018 and May 11, 2018.
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We and CPRL also incorporate by reference into this prospectus supplement any
future filings CPRL makes with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (other than the portions of those made pursuant to Item 2.02 or Item 7.01 of Form
8-K
or other information
furnished and not filed with the SEC) after the date hereof and prior to the completion of the offering of securities under this prospectus supplement.
We and CPRL have not authorized anyone to provide you with any different or additional information other than that contained in or
incorporated by reference into this prospectus supplement. We, CPRL and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide.
Any statement contained in a document incorporated or deemed to be incorporated by reference into this prospectus supplement will be deemed to
be modified or superseded for purposes of this prospectus supplement to the extent that a statement contained in this prospectus supplement or any other subsequently filed document that is deemed to be incorporated by reference into this prospectus
supplement modifies or supersedes the statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.
The documents incorporated by reference into this prospectus supplement are available from us and CPRL upon request. We and CPRL will provide
a copy of any and all of the information that is incorporated by reference in this prospectus supplement to any person to whom a prospectus supplement is delivered, without charge, upon written or oral request. If exhibits to the documents
incorporated by reference in this prospectus supplement are not themselves specifically incorporated by reference in this prospectus supplement, then the exhibits will not be provided.
Requests for any of these documents should be directed to: Canadian Pacific Railway Company, 7550 Ogden Dale Road S.E., Calgary, Alberta, T2C
4X9, Attention: Corporate Secretary, phone (403)
319-7000.
S-24
PROSPECTUS
CANADIAN PACIFIC RAILWAY COMPANY
US$1,500,000,000
Debt
Securities
Fully and Unconditionally Guaranteed by
CANADIAN PACIFIC RAILWAY LIMITED
Canadian
Pacific Railway Company may from time to time offer debt securities which are fully and unconditionally guaranteed by our parent company Canadian Pacific Railway Limited, having an aggregate offering price of up to US$1,500,000,000 or its equivalent
in any other currency. These debt securities may consist of debentures, notes or other types of debt and may be issued in series.
This
prospectus describes some of the general terms that may apply to the debt securities. Each time we offer to sell debt securities, we will provide the specific terms of such debt securities and the offering in a supplement to this prospectus. We may
not use this prospectus to sell debt securities unless we also give prospective investors a supplement to this prospectus. The prospectus supplement may also add, update or change information contained in this prospectus. You should read this
prospectus and the applicable prospectus supplement carefully before you invest in our debt securities.
Investing in our debt
securities involves risk. See the
Risk Factors
section on page 4 of this prospectus, in any applicable prospectus supplement, and in any documents we incorporate by reference in this prospectus or any
applicable prospectus supplement(s) before investing in our debt securities.
We may sell the debt securities to or through
underwriters purchasing as principals and may also sell such debt securities to one or more purchasers directly, in accordance with applicable securities laws, or through agents. See Plan of Distribution. The prospectus supplement
relating to a particular offering of debt securities will identify each underwriter or agent, as the case may be, engaged by us in connection with the offering and sale of the debt securities, and will set forth the terms of the offering of such
debt securities, including the method of distribution of such debt securities, the offering price (or the manner of determination thereof if offered on a non-fixed price basis) the proceeds to us, any fees, discounts or other compensation payable to
underwriters or agents and any other material terms of the plan of distribution.
Our principal executive offices are located at 7550 Ogden
Dale Road S.E., Calgary, Alberta, Canada, T2C 4X9 and our telephone number is (403) 319-7000.
Neither the
Securities and Exchange Commission of the United States nor any U.S. state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is February 29, 2016.
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
In this prospectus and in any prospectus supplement, unless otherwise specified or the context otherwise requires, all dollar amounts are
expressed in Canadian dollars, and references to dollars or $ are to Canadian dollars and all references to US$ are to United States dollars. Unless the context otherwise requires, all references in this
prospectus and any prospectus supplement to CPRC, Corporation, we, us, and our mean Canadian Pacific Railway Company and its subsidiaries on a consolidated basis. Unless otherwise specified
or the context otherwise requires, all references in this prospectus and any prospectus supplement to CPRL mean Canadian Pacific Railway Limited.
This prospectus is part of a Registration Statement on Form S-3 relating to the debt securities that is filed with the U.S. Securities and
Exchange Commission (the Commission). Under the Registration Statement, we may, from time to time, sell the debt securities described in this prospectus and the related guarantees by CPRL, in one or more offerings up to an aggregate
offering price of US$1,500,000,000 or its equivalent in any other currency. This prospectus provides you with a general description of the debt securities that we may offer and the related guarantees by CPRL. Each time we sell debt securities under
the Registration Statement, we will provide a prospectus supplement that will contain specific information about the terms of that offering of debt securities. The prospectus supplement also may add, update or change information contained in this
prospectus. Before investing, investors should read both this prospectus and any applicable prospectus supplement together with additional information described under the headings Where You Can Find More Information and Documents
Incorporated by Reference. This prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the SEC. Investors may refer to the
Registration Statement and the exhibits to the Registration Statement for further information with respect to CPRC and the debt securities.
All information permitted under applicable laws to be omitted from this prospectus will be contained in one or more prospectus supplements
that will be delivered to purchasers together with this prospectus. A prospectus supplement containing the specific terms of an offering of debt securities will be delivered to purchasers of such debt securities together with this prospectus and
will be deemed to be incorporated by reference into this prospectus as of the date of the prospectus supplement only for the purposes of the distribution of the debt securities to which the prospectus supplement pertains.
You should rely only on the information incorporated by reference or provided in this prospectus or any applicable prospectus supplement. We
have not authorized anyone to provide you with different or additional information. You should not assume that the information contained in this prospectus or any prospectus supplement or any other document we incorporate by reference in this
prospectus or any prospectus supplement is accurate as of any date other than the date of such documents, regardless of the time of delivery of the prospectus or prospectus supplement or any sale of the debt securities. Our business, financial
condition, results of operations and prospects, as well as other information, may have changed since such dates.
Unless otherwise
indicated, all financial information included and incorporated by reference into this prospectus is determined using generally accepted accounting principles in the United States, referred to as U.S. GAAP.
WHERE YOU CAN FIND MORE INFORMATION
We are a 100%-owned subsidiary of CPRL, a publicly traded corporation whose common shares are listed on the Toronto Stock Exchange and the New
York Stock Exchange.
CPRL is subject to the informational requirements of the United States Securities Exchange Act of 1934, as amended
(the U.S. Exchange Act), and in accordance therewith, CPRL files reports and other information with the SEC. Under the multijurisdictional disclosure system adopted by Canada and the United States, reports filed by CPRL prior to
January 1, 2016 with the SEC have been prepared in accordance with the
1
disclosure requirements of Canada, which requirements are different from those of the United States. You may read any document CPRL files or furnishes to the SEC at the SECs public
reference room at Room 1580, 100 F Street, N.E., Washington, D.C., 20549. Copies of the same documents may also be obtained from the public reference room of the SEC at 100 F Street, N.E., Washington D.C., 20549 by paying a fee. Please call the SEC
at 1-800-SEC-0330 or access its website at www.sec.gov for further information on the public reference room. CPRLs filings since November 2002 are also electronically available from the SECs Electronic Document Gathering and Retrieval
System, which is commonly known by the acronym EDGAR and which may be accessed at www.sec.gov, as well as from commercial document retrieval services.
You may access other information about us and CPRL on CPRLs website (http://www.cpr.ca). Information on CPRLs website is not
incorporated by reference in this prospectus.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us and CPRL to incorporate by reference much of the information CPRL files with it, which means that we and CPRL can disclose
important information to you by referring you to those publically available documents. The information we and CPRL incorporate by reference in this prospectus is an important part of this prospectus.
We and CPRL incorporate by reference into this prospectus the following documents CPRL has filed with the Commission:
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CPRLs Annual Report on Form 10-K for the year ended December 31, 2015 (filed on February 29, 2016);
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CPRLs definitive proxy statement on Schedule 14A with respect to CPRLs 2016 annual meeting of stockholders (filed February 29, 2016) (but only to the extent that any sections of CPRLs proxy
statement are incorporated into its Annual Report on Form 10-K for the year ended December 31, 2015); and
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CPRLs Current Reports on Form 8-K, filed on January 12, 2016, January 14, 2016, January 19, 2016, January 20, 2016, January 27, 2016, February 3,
2016, February 9, 2016, February 16, 2016 and February 24, 2016.
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We and CPRL also incorporate by reference
each document CPRL files with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding information furnished pursuant to Items 2.02 and 7.01 of Form 8-K) after the date of this prospectus and prior to the
filing of a post-effective amendment that indicates that all debt securities offered hereby have been sold or which deregisters all securities then remaining unsold.
Any statement contained in any document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this prospectus to the extent that a statement contained herein or in any other subsequently filed or furnished document which also is or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed to constitute a part of this prospectus, except as so modified or superseded.
You may obtain a copy of any of any filings that are incorporated by reference into this prospectus or a copy of this prospectus, at no cost,
by writing to or telephoning us at the following address:
Canadian Pacific Railway Limited
7550 Ogden Dale Road S.E.
Calgary,
Alberta, T2C 4X9
(403) 319-7538
Attention: Corporate Secretary
2
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference herein include forward-looking information and forward-looking
statements within the meaning of securities laws, including the safe harbour provisions of the Securities Act (
Alberta
), the United States Private Securities Litigation Reform Act of 1995, Section 21E of the U.S.
Exchange Act and Section 27A of the United States Securities Act of 1933, as amended (the U.S. Securities Act). All forward-looking information and forward-looking statements are based on our and CPRLs current beliefs as well
as assumptions made by and information currently available to us and CPRL. Forward-looking information and forward-looking statements are based on our and CPRLs current beliefs as well as assumptions made by and information currently available
to us and CPRL. Forward-looking statements in or incorporated by reference into this prospectus include, but are not limited to, statements with respect to: our and CPRLs defined benefit pension expectations for 2016 and through 2019,
expectations for 2016 which includes: operating ratio below 59 percent, double-digit earnings per share (EPS) growth from full-year 2015 adjusted diluted EPS of $10.10, and capital expenditures of approximately $1.1 billion, as well as
statements concerning operations, anticipated financial performance, business prospects and strategies, including statements concerning the anticipation that cash flow from operations and various sources of financing will be sufficient to meet debt
repayments and obligations in the foreseeable future and concerning anticipated capital programs, statements regarding future payments including income taxes and pension contributions, and capital expenditures. Forward-looking statements typically
contain statements with words such as financial expectations, key assumptions, anticipate, believe, expect, plan, will, outlook, should or
similar words suggesting future outcomes.
By its nature, our and CPRLs forward-looking information and forward-looking statements
involve numerous assumptions, inherent risks and uncertainties, including but not limited to the following factors: changes in business strategies; general North American and global economic, credit and business conditions; risks in agricultural
production such as weather conditions and insect populations; the availability and price of energy commodities; the effects of competition and pricing pressures; industry capacity; shifts in market demand; inflation; changes in laws and regulations,
including regulation of rates; changes in taxes and tax rates; potential increases in maintenance and operating costs; uncertainties of investigations, proceedings or other types of claims and litigation; labour disputes; risks and liabilities
arising from derailments; transportation of dangerous goods; timing of completion of capital and maintenance projects; currency and interest rate fluctuations; effects of changes in market conditions on the financial position of pension plans and
investments; and various events that could disrupt operations, including severe weather, droughts, floods, avalanches and earthquakes as well as security threats and the governmental response to them, and technological changes.
The risks and uncertainties of our and CPRLs business, including those discussed above and in documents incorporated by reference into
this prospectus and as described under Risk Factors and elsewhere herein, could cause our and CPRLs actual results and experience to differ materially from the anticipated results or other expectations expressed. In addition, we
and CPRL base forward-looking information and forward-looking statements on assumptions about future events, which, although reasonable when made, may not prove to be accurate.
In light of these risks, uncertainties and assumptions, prospective investors should not place undue reliance on forward-looking information
and forward-looking statements and should be aware that events described in the forward-looking information and forward-looking statements set out in this prospectus and the documents incorporated by reference into this prospectus may not occur.
We and CPRL cannot assure prospective investors that our future results, levels of activity and achievements will occur as we expect, and
neither we nor CPRL, nor any other person assumes responsibility for the accuracy and completeness of the forward-looking information and forward-looking statements. Except as required by law, we and CPRL undertake no obligation to update publically
or otherwise revise any forward-looking information or forward-looking statement, whether as a result of new information, future events or otherwise.
3
Adjusted diluted EPS referred to above has no standardized meaning prescribed by U.S.
GAAP and, therefore, may not be comparable to a similar measure presented by other companies. See Item 7, Managements Discussion and Analysis of Financial Condition and Results of Operations of CPRLs Annual Report on Form 10-K dated
February 29, 2016 for the definition and further discussion of this non-U.S. GAAP measure.
DESCRIPTION OF DEBT SECURITIES AND GUARANTEE
In this section only, we, us or our refer only to Canadian Pacific Railway Company without any of its
subsidiaries through which it operates.
The following description sets forth certain general terms and provisions of the debt securities
and the related guarantees by CPRL. The particular terms and provisions of the series of debt securities offered by any prospectus supplement, and the extent to which the general terms and provisions described below may apply thereto, will be
described in the applicable prospectus supplement, which may provide information that is different from this prospectus.
The debt
securities will be issued under a trust indenture (the Indenture) entered into between us and Wells Fargo Bank, National Association, as trustee on September 11, 2015 (the Trustee). The Indenture has been filed with the
SEC, and is incorporated by reference as an exhibit hereto. Debt securities may also be issued under new indentures between us and a trustee or trustees as will be discussed in a prospectus supplement for such debt securities. The following
statements with respect to the Indenture and the debt securities (as hereinafter defined) are brief summaries of the material provisions of the Indenture. However, it is the Indenture, and not this summary, that governs your rights as a holder of
the debt securities. Wherever particular sections or defined terms of the Indenture are referred to, these sections or defined terms are incorporated herein by reference as part of the statement made, and the statement is qualified in its entirety
by this reference. The term Securities, as used under this caption, refers to all securities issued under the Indenture, including the debt securities. Prospective investors should rely on information in the applicable prospectus
supplement if it is different from the following information.
Guarantee
CPRL will fully and unconditionally guarantee the payment of the principal (and premium, if any) and interest, on the debt securities issued
by us, any sinking fund or analogous payments payable with respect to such debt securities and any Additional Amounts payable with respect to such debt securities, when they become due and payable, whether at the stated maturity thereof or by
declaration of acceleration, call for redemption or otherwise.
General
The Indenture does not limit the aggregate principal amount of Securities (which may include debentures, notes and other evidences of
indebtedness) which may be issued thereunder, and Securities may be issued thereunder from time to time in one or more series and may be denominated and payable in foreign currencies. The Securities offered pursuant to this prospectus will be issued
in an amount up to US$1,500,000,000 or the equivalent in other currency or units based on other foreign currencies. The Indenture also permits us to increase the principal amount of any series of Securities previously issued and to issue that
increased principal amount.
6
The applicable prospectus supplement will set forth certain terms relating to the debt securities
offered thereby (the Offered Securities), including the following:
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the specific designation of the Offered Securities;
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any limit on the aggregate principal amount of the Offered Securities;
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the extent and manner, if any, to which payment on or in respect of the Offered Securities will be senior or will be subordinated to the prior payment of our other liabilities and obligations;
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the percentage or percentages of principal amount at which the Offered Securities will be issued;
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the date or dates, if any, on which the Offered Securities will mature and the portion (if less than all of the principal amount) of the Offered Securities to be payable upon declaration of acceleration of maturity;
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the rate or rates (which may be fixed or variable) at which the Offered Securities will bear interest, if any, the date or dates from which that interest will accrue and on which that interest will be payable and the
regular record dates for any interest payable on the Offered Securities;
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any mandatory or optional redemption or sinking fund provisions, including the period or periods within which, the price or prices at which and the terms and conditions upon which the Offered Securities may be redeemed
or purchased at our option or otherwise;
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whether the Offered Securities will be issuable in registered form or bearer form or both, and, if issuable in bearer form, the restrictions as to the offer, sale and delivery of the Offered Securities in bearer form
and as to exchanges between registered and bearer form;
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whether the Offered Securities will be issuable in the form of one or more global securities and, if so, the identity of the depositary for those global securities;
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the denominations in which any of the Offered Securities which are in registered form will be issuable, if other than denominations of US$1,000 and any multiple thereof, and the denominations in which any of the Offered
Securities which are in bearer form will be issuable, if other than the denomination of US$1,000;
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each office or agency where the principal of and any premium and interest on the Offered Securities will be payable, and each office or agency where the Offered Securities may be presented for registration of transfer
or exchange;
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if other than United States dollars, the foreign currency or the units based on or relating to foreign currencies in which the Offered Securities are denominated and/or in which the payment of the principal of and any
premium and interest on the Offered Securities will or may be payable;
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whether and under what circumstances we will pay Additional Amounts on the Offered Securities of such series in respect of certain taxes (and the terms of any such payment) and, if so, whether we will have the option to
redeem the Offered Securities of such series rather than pay the Additional Amounts (and the terms of any such option);
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any index pursuant to which the amount of payments of principal of and any premium and interest on the Offered Securities will or may be determined;
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any applicable material Canadian and U.S. federal income tax considerations; and
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any other terms of the Offered Securities, including covenants and Events of Default relating solely to the Offered Securities or any covenants or Events of Default generally applicable to the Securities which are not
to apply to the Offered Securities.
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7
Unless otherwise indicated in the applicable prospectus supplement, the Indenture does not afford
the holders the right to tender Securities to us for repurchase, or provide for any increase in the rate or rates of interest per annum at which the Securities will bear interest.
Securities may be issued under the Indenture bearing no interest and may be offered and sold at a discount below their stated principal
amount. The Canadian and U.S. federal income tax consequences and other special considerations applicable to those discounted Securities or other Securities offered and sold at par which are treated as having been issued at a discount for Canadian
and/or U.S. federal income tax purposes will be described in the prospectus supplement relating thereto.
Ranking
Unless otherwise indicated in the applicable prospectus supplement, the debt securities will be our unsecured obligations and will rank pari
passu with all our other unsecured and unsubordinated debt from time to time outstanding and pari passu with other Securities issued under the Indenture. We conduct a substantial portion of our business through corporate and partnership
subsidiaries. The debt securities will be structurally subordinated to all existing and future liabilities, including trade payables and other indebtedness, of any of our corporate or partnership subsidiaries.
The guarantee will be CPRLs unsubordinated and unsecured obligation and, unless otherwise provided with respect to a series of debt
securities, will rank equally with all of CPRLs other unsecured, unsubordinated obligations. CPRL conducts a substantial portion of its business through corporate and partnership subsidiaries. CPRLs obligations under the guarantee will
be structurally subordinate to all existing and future indebtedness and liabilities of any of CPRLs corporate and partnership subsidiaries.
Debt
Securities in Global Form
Unless otherwise indicated in the applicable prospectus supplement, debt securities of a particular series
will be issued in the form of one or more global securities which will be registered in the name of and be deposited with a depositary, or its nominee, each of which will be identified in the prospectus supplement relating to that
series. Unless and until exchanged, in whole or in part, for Securities in definitive form, a global security may not be transferred except as a whole by the depositary for a global security to a nominee of that depositary, by a nominee of that
depositary to that depositary or another nominee of that depositary or by that depositary or any nominee of that depositary to a successor of that depositary or a nominee of a successor of that depositary.
The specific terms of the depositary arrangement with respect to any portion of a particular series of Securities to be represented by a
global security will be described in the prospectus supplement relating to that series. We anticipate that the following provisions will apply to all depositary arrangements.
Upon the issuance of a global security, the depositary therefor or its nominee will credit, on its book entry and registration system, the
respective principal amounts of the Securities represented by that global security to the accounts of those persons having accounts with that depositary or its nominee (participants) as shall be designated by the underwriters, investment
dealers or agents participating in the distribution of those Securities or by us if those Securities are offered and sold directly by us. Ownership of beneficial interests in a global security will be limited to participants or persons that may hold
beneficial interests through participants. Ownership of beneficial interests in a global security will be shown on, and the transfer of the ownership of those beneficial interests will be effected only through, records maintained by the depositary
therefor or its nominee (with respect to beneficial interests of participants) or by participants or persons that hold through participants (with respect to interests of persons other than participants). The laws of some states in the United States
require certain purchasers of securities to take physical delivery thereof in definitive form. These depositary arrangements and these laws may impair the ability to transfer beneficial interests in a global security.
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So long as the depositary for a global security or its nominee is the registered owner thereof,
that depositary or its nominee, as the case may be, will be considered the sole owner or holder of the Securities represented by that global security for all purposes under the Indenture. Except as provided below, owners of beneficial interests in a
global security will not be entitled to have Securities of the series represented by that global security registered in their names, will not receive or be entitled to receive physical delivery of Securities of that series in definitive form and
will not be considered the owners or holders of those Securities under the Indenture.
Principal, premium, if any, and interest payments
on a global security registered in the name of a depositary or its nominee will be made to that depositary or nominee, as the case may be, as the registered owner of that global security. None of us, the Trustee or any paying agent for Securities of
the series represented by that global security will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial interests in that global security or for maintaining, supervising or
reviewing any records relating to those beneficial interests.
We expect that the depositary for a global security or its nominee, upon
receipt of any payment of principal, premium or interest, will immediately credit participants accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of that global security as shown on
the records of that depositary or its nominee. We also expect that payments by participants to owners of beneficial interests in that global security held through those participants will be governed by standing instructions and customary practices,
as is the case with securities held for the accounts of customers registered in street name, and will be the responsibility of those participants.
If the depositary for a global security representing Securities of a particular series is at any time unwilling or unable to continue as
depositary, or if the depositary is no longer eligible to continue as depositary, and a successor depositary is not appointed by us within 90 days, or if an Event of Default described in clauses (a) or (b) of the first sentence under
Events of Default below with respect to a particular series of Securities has occurred and is continuing, we will issue securities of that series in definitive form in exchange for that global security. In addition, we may at any time
and in our sole discretion determine not to have the Securities of a particular series represented by one or more global securities and, in that event, will issue securities of that series in definitive form in exchange for all of the global
securities representing securities of that series.
Debt Securities in Definitive Form
If indicated in the applicable prospectus supplement, the Securities may be issued in fully registered form without coupons and in
denominations of US$1,000 or any integral multiple thereof. Securities may be presented for exchange and debt securities may be presented for registration of transfer in the manner, at the places and, subject to the restrictions set forth in the
Indenture and in the applicable prospectus supplement, without service charge, but upon payment of any taxes or other governmental charges due in connection therewith. We have appointed the Trustee as Security Registrar. Securities in bearer form
and the coupons appertaining thereto, if any, will be transferable by delivery.
Unless otherwise indicated in the applicable prospectus
supplement, payment of the principal of and any premium and interest on Securities (other than a global security) will be made at the office or agency of the Trustee at 150 East 42nd Street, 40th Floor, New York, New York, 10017, except that, at our
option, payment of any interest may be made (a) by cheque mailed to the address of the Person entitled thereto as that Persons address will appear in the Security Register or (b) by wire transfer to an account maintained by the
Person entitled thereto as specified in the Security Register.
Negative Pledge
The Indenture includes a covenant of ours to the effect that, so long as any of the Securities remain outstanding, we will not, and will not
permit any Subsidiary to, create, assume or otherwise have outstanding any
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Security Interest, except for Permitted Encumbrances, on or over any of our present or future Railway Properties or any of our Subsidiaries or on any shares in the capital stock of any Railroad
Subsidiary securing any Indebtedness of any Person without also at the same time or prior thereto securing equally and ratably with such other Indebtedness all of the Securities then outstanding under the Indenture.
Certain Definitions
Set forth below is
a summary of certain of the defined terms used in the Indenture. Reference is made to the Indenture for the full definitions of all such terms.
The term
Borrowed Money
means Indebtedness in respect of moneys borrowed (including interest and other charges in respect
thereof) and moneys raised by the issue of notes, bonds, debentures or other evidences of moneys borrowed.
The term
Capital
Lease Obligation
means the obligation of a Person, as lessee, to pay rent or other amounts to the lessor under a lease of real or personal property which is required to be classified and accounted for as a capital lease on a consolidated
balance sheet of such Person in accordance with GAAP.
The term
Consolidated Net Tangible Assets
means the total amount
of assets determined on a consolidated basis after deducting therefrom:
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all current liabilities (excluding any Indebtedness classified as a current liability and any current liabilities which are by their terms extendible or renewable at the option of the obligor thereon to a time more than
12 months after the time as of which the amount thereof is being computed);
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all goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other like intangibles; and
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appropriate adjustments on account of minority interests of other Persons holding stock of our Subsidiaries,
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all as set forth on our most recent consolidated balance sheet and computed in accordance with GAAP.
The term
FATCA
means (a) Sections 1471 through 1474 of the
Internal Revenue Code of 1986
, as amended from time
to time (including regulations and guidance thereunder) (the Code), (b) any successor version thereof, (c) any agreement entered into pursuant to Section 1471(b)(1) of the Code or (d) any law, regulation, rule or
practice implementing an intergovernmental agreement or approach thereto.
The term
GAAP
means, at any time, accounting
principles generally accepted in the United States at the relevant time applied on a consistent basis, provided that, if reference to GAAP is in respect of any financial statements which are prepared in accordance with generally accepted
accounting principles of Canada, GAAP shall mean generally accepted accounting principles in Canada as recommended in the Handbook of the Canadian Institute of Chartered Accountants at the relevant time, applied on a consistent basis.
The term
Indebtedness
means and includes all items of indebtedness which, in accordance with GAAP, would be included
in determining total liabilities as shown on the liability side of a balance sheet as at the date as of which Indebtedness is to be determined, but in any event including, without limitation, (1) obligations in respect of indebtedness for
Borrowed Money secured by any Security Interest existing on property owned subject to such Security Interest, whether or not the obligations secured thereby shall have been assumed, and (2) guarantees and other contingent obligations in respect
of, or any obligations to purchase or otherwise acquire or service, indebtedness of any other Person.
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The term
Permitted Encumbrances
means any of the following:
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(a)
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any Security Interest existing as of the date of the first issuance by us of the Securities issued pursuant to the Indenture, or arising thereafter pursuant to contractual commitments entered into prior to such
issuance, including without limitation, any of our outstanding Perpetual 4% Consolidated Debenture Stock, whether issued, pledged or vested in trust;
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(b)
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any Security Interest in favor of us or any of our wholly-owned Subsidiaries;
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(c)
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any Security Interest existing on the property of any Person at the time such Person becomes a Subsidiary, or arising thereafter pursuant to contractual commitments entered into prior to and not in contemplation of such
Person becoming a Subsidiary;
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(d)
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any Security Interest on property of a Person which Security Interest exists at the time such Person is merged into, or amalgamated or consolidated with, us or a Subsidiary, or such property is otherwise acquired by us
or a Subsidiary, provided that such Security Interest does not extend to property owned by us or such Subsidiary immediately prior to such merger, amalgamation, consolidation or acquisition;
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(e)
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any Security Interest already existing on property acquired (including by way of lease) by us or any of our Subsidiaries at the time of such acquisition;
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(f)
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any Security Interest securing any Indebtedness incurred in the ordinary course of business and for the purpose of carrying on the same, repayable on demand or maturing within 12 months of the date when such
Indebtedness is incurred or the date of any renewal or extension thereof;
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(g)
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any Security Interest in respect of (i) liens for taxes and assessments not at the time overdue or any liens
securing workmens compensation assessments, unemployment insurance or other social security obligations; provided, however, that if any such liens, duties or assessments are then overdue, we or the Subsidiary, as the case may be, shall be
prosecuting an appeal or proceedings for review with respect to which it shall be entitled to or shall have secured a stay in the enforcement of any such obligations, (ii) any lien for specified taxes and assessments which are overdue but the
validity of which is being contested at the time by us or the Subsidiary, as the case may be, in good faith, (iii) any liens or rights of distress reserved in or exercisable under any lease for rent and for compliance with the terms of such
lease, (iv) any obligations or duties, affecting our property or that of a Subsidiary to any municipality or governmental, statutory or public authority, with respect to any franchise, grant, license or permit and any defects in title to
structures or other facilities arising from the fact that such structures or facilities are constructed or installed on lands held by us or the Subsidiary under government permits, leases, licenses or other grants, (v) any deposits or liens in
connection with contracts, bids, tenders or expropriation proceedings, surety or appeal bonds, costs of litigation when required by law, public and statutory obligations and liens or claims incidental to current construction or operations including
but not limited to, builders, mechanics, laborers, materialmens, warehousemens, carriers and other similar liens, (vi) the right reserved to or vested in any municipality or governmental or other public
authority by any statutory provision or by the terms of any lease, license, franchise, grant or permit to terminate any such lease, license, franchise, grant or permit or to require annual or other periodic payments as a condition to the continuance
thereof, (vii) any Security Interest the validity of which is being contested at the time by us or a Subsidiary in good faith or payment of which has been provided for by creation of a reserve in an amount in cash sufficient to pay the same in
full, (viii) any easements, rights-of-way and servitudes (including, without in any way limiting the generality of the foregoing, easements, rights-of-way and servitudes for railways, sewers, dykes, drains, gas and water mains or electric light
and power or telephone conduits, poles, wires and cables) and minor defects, or irregularities of title that, in our opinion, will not in the aggregate materially and adversely impair the use or value of the land
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concerned for the purpose for which it is held by us or the Subsidiary, as the case may be, (ix) any security to a public utility or any municipality or governmental or other public
authority when required by such utility or other authority in connection with our operations or the operations of our Subsidiary, as the case may be, (x) any liens and privileges arising out of judgments or awards with respect to which we or
the Subsidiary shall be prosecuting an appeal or proceedings for review and with respect to which it shall be entitled to or shall have secured a stay of execution pending such appeal or proceedings for review, and (xi) reservations,
limitations, provisos and conditions, if any, expressed in or affecting any grant of real or immoveable property or any interest therein;
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(h)
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any Security Interest in respect of any Purchase Money Obligation;
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(i)
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any extension, renewal, alteration or replacement (or successive extensions, renewals, alterations or replacements) in whole or in part, of any Security Interest referred to in the foregoing clauses (a) through
(h) inclusive, provided that the principal amount of the Indebtedness secured thereby on the date of such extension, renewal, alteration or replacement is not increased and the Security Interest is limited to the property or other assets which
secured the Security Interest so extended, renewed, altered or replaced (plus improvements on such property or other assets or the proceeds thereof); and
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(j)
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any Security Interest that would otherwise be prohibited (including any extensions, renewals, alterations or replacements thereof) provided that the aggregate Indebtedness outstanding and secured under this clause
(j) does not (calculated at the time of the granting of the Security Interest) exceed an amount equal to 10% of Consolidated Net Tangible Assets.
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The term
Person
means any individual, corporation, limited liability company, partnership, association, joint-stock
company, trust, unincorporated organization or government or any agency or political subdivision thereof.
The term
Purchase
Money Obligation
means any monetary obligation (including a Capital Lease Obligation) created, assumed or incurred prior to, at the time of, or within 180 days after, the acquisition (including by way of lease), construction or improvement
of any real or tangible personal property, for the purpose of financing all or any part of the purchase price or lease payments in respect thereof, provided that the principal amount of such obligation may not exceed the unpaid portion of the
purchase price or lease payments, as applicable, and further provided that any security given in respect of such obligation shall not extend to any property other than the property acquired in connection with which such obligation was created or
assumed and fixed improvements, if any, thereto or erected or constructed thereon and the proceeds thereof.
The term
Railway
Properties
means all main and branch lines of railway located in Canada or the United States, including all real property used as the right of way for such lines.
The term
Railroad Subsidiary
means a Subsidiary whose principal assets are Railway Properties.
The term
Security Interest
means any security by way of an assignment, mortgage, charge, pledge, lien, encumbrance, title
retention agreement or other security interest whatsoever, howsoever created or arising, whether absolute or contingent, fixed or floating, perfected or not, but not including any security interest in respect of a lease which is not a Capital Lease
Obligation or any encumbrance that may be deemed to arise solely as a result of entering into an agreement not in violation of the terms of the Indenture to sell or otherwise transfer assets or property.
The term
Shareholders Equity
means, with respect to any Person, at any date, the aggregate of the dollar amount of
outstanding share capital, the amount, without duplication, of any surplus, whether contributed or capital, and retained earnings, subject to any currency translation adjustment, all as set forth in such Persons most recent annual consolidated
balance sheet.
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The term
Significant Subsidiary
means a Subsidiary that constitutes a
significant subsidiary as defined in Rule 1-02 of Regulation S-X of the U.S. Exchange Act, as amended.
The term
Subsidiary
means any corporation or other Person of which there are owned, directly or indirectly, by or for us or by or for any corporation or other Person in like relation to us, Voting Shares or other interests which, in the
aggregate, entitle the holders thereof to cast more than 50% of the votes which may be cast by the holders of all outstanding Voting Shares of such first mentioned corporation or other Person for the election of its directors or, in the case of any
Person which is not a corporation, Persons having similar powers or (if there are no such Persons) entitle the holders thereof to more than 50% of the income or capital interests (however called) thereon and includes any corporation in like relation
to a Subsidiary.
The term
Voting Shares
means shares of capital stock of any class of a corporation and other
interests of any other Persons having under all circumstances the right to vote for the election of the directors of such corporation or in the case of any Person which is not a corporation, Persons having similar powers or (if there are no such
Persons) income or capital interests (however called), provided that, for the purpose of this definition, shares or other interests which only carry the right to vote conditionally on the happening of an event shall not be considered Voting Shares
whether or not such event shall have happened.
Consolidation, Merger, Amalgamation and Sale of Assets
We shall not enter into any transaction (whether by way of consolidation, amalgamation, merger, transfer, sale or otherwise) whereby all or
substantially all of our assets would become the property of any other Person (the Successor) unless (a) we and the Successor shall, prior to or contemporaneously with the consummation of that transaction, execute those instruments,
which may include a supplemental indenture, and do those things, if any, as shall be necessary or advisable to establish that upon the consummation of that transaction (i) the Successor will have assumed all of our covenants and obligations
under the Indenture in respect of the Securities of every series, and (ii) the Securities of every series will be valid and binding obligations of the Successor entitling the holders thereof, as against the Successor Corporation, to all the
rights of holders of Securities under the Indenture; (b) the Successor is a corporation, company, partnership, or trust organized and validly existing under the laws of Canada or any province thereof or of the United States, any state thereof
or the District of Columbia; (c) we deliver to the Trustee an officers certificate and an opinion of counsel, each stating that the transaction and any supplemental indenture comply with the Indenture and all conditions precedent
contained in the Indenture relating to such transaction have been complied with; and (d) immediately before and after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing.
Provision of Financial Information
We will file with the Trustee, within 15 days after CPRL is required to file them with the SEC, copies, which may be in electronic format, of
the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may from time to time by rules and regulations prescribe) which CPRL may be required to file with the SEC pursuant
to Section 13 or Section 15(d) of the U.S. Exchange Act. Or if CPRL is not required to file information, documents or reports pursuant to either of Section 13 or Section 15(d), then we will file with the Trustee and the SEC, in
accordance with rules and regulations prescribed from time to time by the SEC, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the U.S. Exchange Act in respect of a debt
security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations.
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Events of Default
The occurrence of any of the following events with respect to the Securities of any series will constitute an Event of Default
with respect to the Securities of that series:
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(a)
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default by us in payment of the principal of any of the Securities of that series when the same becomes due under any provision of the Indenture or of those Securities;
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(b)
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default by us in payment of any interest due on any of the Securities of that series and continuance of that default for a period of 30 days;
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(c)
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default by us in observing or performing any other of our covenants or conditions contained in the Indenture or in the Securities of that series and continuance of that default for a period of 60 days after written
notice as provided in the Indenture;
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(d)
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default by us or any Subsidiary in payment of the principal of, premium, if any, or interest on any Indebtedness having an outstanding principal amount in excess of the greater of $150 million and 2% of our
Shareholders Equity in the aggregate at the time of default or default in the performance of any other covenant of ours or any Subsidiary contained in any instrument under which that Indebtedness is created or issued and the holders thereof,
or a trustee, if any, for those holders, declare that Indebtedness to be due and payable prior to the stated maturities of that Indebtedness (accelerated Indebtedness), and such acceleration shall not be rescinded or annulled, or such
default under such instrument shall not be remedied or cured, whether by payment or otherwise, or waived by the holders of such Indebtedness, provided that (i) if such accelerated Indebtedness is the result of an event of default which is not
related to the failure to pay principal or interest on the terms, at the times and on the conditions set forth in such instrument, it will not be considered an Event of Default under this clause (d) until 30 days after such acceleration, or
(ii) if such accelerated Indebtedness shall occur as a result of such failure to pay principal or interest or as a result of an event of default which is related to the failure to pay principal or interest on the terms, at the times, and on the
conditions set out in any such indenture or instrument, then (A) if such accelerated
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Indebtedness is, by its terms,
non recourse to us or the Railroad Subsidiaries, it shall not be considered an Event of Default; or (B) if such accelerated Indebtedness is recourse to us or the Railroad Subsidiaries, any requirement in connection with such failure to pay or
event of default for the giving of notice or the lapse of time or the happening of any further condition, event or act under such other indenture or instrument in connection with such failure to pay principal or an event of default shall be
applicable together with an additional seven days before being considered an Event of Default;
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(e)
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certain events of bankruptcy, insolvency, winding up, liquidation or dissolution relating to us or any Significant Subsidiary as provided in the Indenture; or
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(f)
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any other event of default provided with respect to that series.
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If an Event of Default
described in clause (a) or (b) above occurs and is continuing with respect to Securities of any series, unless the principal of all of the Securities of that series shall have already become due and payable, the Trustee shall upon request
in writing made by the holders of not less than 25% in aggregate principal amount of the Securities of that series then outstanding, declare the principal of (and premium, if any, on) all the Securities of that series then outstanding and the
interest accrued thereon and all other money, if any, owing under the provisions of the Indenture in respect of those Securities to be due and payable immediately on demand. If an Event of Default described in clause (c) or (f) above
occurs and is continuing with respect to the Securities of one or more series, unless the principal of all of the Securities of the affected series shall have
14
already become due and payable, the Trustee shall upon request in writing made by the holders of not less than 25% in aggregate principal amount of the Securities of all such affected series then
outstanding (voting as one class), declare the principal of (and premium, if any, on) all the Securities of all the affected series then outstanding and the interest accrued thereon and all other money, if any, owing under the provisions of the
Indenture in respect of those Securities to be due and payable immediately on demand. If an Event of Default described in clause (d) or (e) above occurs and is continuing, unless the principal of all Securities then outstanding shall have
already become due and payable, the Trustee shall upon request in writing made by the holders of not less than 25% in aggregate principal amount of all the Securities then outstanding (voting as one class), declare the principal of (and premium, if
any, on) all the Securities then outstanding and the interest accrued thereon and all other money, if any, owing under the provisions of the Indenture in respect of those Securities to be due and payable immediately on demand. Upon certain
conditions, any declaration of this kind may be cancelled if all Events of Default with respect to the Securities of all those affected series then outstanding shall have been cured or waived as provided in the Indenture by the holders of not less
than a majority in aggregate principal amount of the Securities of the affected series then outstanding (voting as one class, except in the case of Events of Default described in clauses (a) and (b) of the first sentence of the preceding
paragraph, as to which each series so affected will vote as a separate class). See Modification and Waiver below.
Reference
is made to the applicable prospectus supplement or supplements relating to any series of original issue discount Securities for the particular provisions relating to the acceleration of a portion of the principal amount thereof upon the occurrence
and continuance of an Event of Default with respect thereto.
The Indenture provides that the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request or direction of the holders, unless those holders shall have provided to the Trustee indemnity satisfactory to it, acting reasonably. Subject to those provisions for indemnity
and certain other limitations contained in the Indenture, the holders of a majority in aggregate principal amount of the Securities of all affected series then outstanding (voting as one class) will have the right to sanction or direct the time,
method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of those affected series.
The Indenture provides that no holder of the Securities of any series will have any right to institute any proceeding with respect to the
Indenture or for any remedy thereunder, unless (a) that holder shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Securities of that series, (b) the holders of not less than 25%
in aggregate principal amount of the Securities of all affected series then outstanding shall have made written request, and offered to the Trustee indemnity reasonably satisfactory to it to institute that proceeding, (c) the Trustee shall not
have received from the holders of a majority in aggregate principal amount of the Securities of all affected series then outstanding a direction inconsistent with that request and (d) the Trustee shall have failed to institute that proceeding
within 60 days after that notification, request and offer of indemnity. However, the holder of any Security will have an absolute right to receive payment of the principal of and any premium and interest on that Security on or after the due dates
expressed in that Security and to institute suit for the enforcement of any of these payments. The Indenture requires us to furnish to the Trustee annually an officers certificate as to our compliance with certain covenants, conditions or
other requirements contained in the Indenture and as to any non-compliance therewith.
The Indenture provides that the Trustee may
withhold notice to the holders of the Securities of one or more series of any default affecting those series (except defaults as to payment of principal or interest) if it, in good faith, considers that withholding to be in the best interests of the
holders of the Securities of those series.
Additional Amounts
All payments made by us under or with respect to the debt securities will be made free and clear of and without withholding or deduction for
or on account of any present or future tax, duty, levy, impost, assessment or
15
other governmental charge (including penalties, interest and other liabilities related thereto) imposed or levied by or on behalf of the Government of Canada or of any province or territory
thereof or by any authority or agency therein or thereof having power to tax (hereinafter Canadian Taxes), unless we are required to withhold or deduct Canadian Taxes by law or by the interpretation or administration thereof. If we are
so required to withhold or deduct any amount for or on account of Canadian Taxes from any payment made under or with respect to the debt securities, we will pay as additional interest such additional amounts (Additional Amounts) as may
be necessary so that the net amount received by each holder after such withholding or deduction (and after deducting any Canadian Taxes on such Additional Amounts) will not be less than the amount the holder would have received if such Canadian
Taxes had not been withheld or deducted. However, no Additional Amounts will be payable with respect to a payment made to a holder (such holder, an Excluded Holder) in respect of the beneficial owner thereof:
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(a)
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with which we do not deal at arms length (within the meaning of the Income Tax Act (Canada)) at the time of making such payment;
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(b)
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which is subject to such Canadian Taxes by reason of the holder being a resident, domicile or national of, or engaged in business or maintaining a permanent establishment or other physical presence in or otherwise
having some connection with Canada or any province or territory thereof otherwise than by the mere holding of debt securities or the receipt of payments thereunder;
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(c)
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which is subject to such Canadian Taxes by reason of the holders failure to comply with any certification, identification, information, documentation or other reporting requirements if compliance is required by
law, regulation, administrative practice or an applicable treaty as a precondition to exemption from, or a reduction in the rate of deduction or withholding of, such Canadian Taxes;
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(d)
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by reason of such Holder or beneficial owner being a specified shareholder (within the meaning of subsection 18(5) of the Income Tax Act (Canada)) of us at the time of payment or deemed payment, or by reason
of such Holder or beneficial owner not dealing at arms length for the purposes of the Income Tax Act (Canada) with a specified shareholder of us at the time of payment or deemed payment; or
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(e)
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if the Holder or beneficial owner of, or person ultimately entitled to obtain any interest in, the Securities is not the sole beneficial owner of such payments, or is a fiduciary or partnership, to the extent that any
beneficial owner, beneficiary or settlor with respect to such fiduciary or any partner or member of such partnership would not have been entitled to such Additional Amounts with respect to such payments had such beneficial owner, beneficiary,
settlor, partner or member received directly its beneficial or distributive shares of such payments.
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We will also:
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(a)
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make such withholding or deduction; and
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(b)
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remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
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We will furnish to the Trustee and the holders of the debt securities, within 30 days after the date the payment of any Canadian Taxes is due
pursuant to applicable law, certified copies of tax receipts or other documents evidencing such payment by us.
We will indemnify and hold
harmless each holder (other than an Excluded Holder) and upon written request reimburse each such holder for the amount of:
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(a)
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any Canadian Taxes so levied or imposed and paid by such holder as a result of payments made under or with respect to the debt securities;
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(b)
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any liability (including penalties, interest and expenses) arising therefrom or with respect thereto; and
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(c)
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any Canadian Taxes imposed with respect to any reimbursement under clause (a) or (b) above, but excluding any such Canadian Taxes on such holders net income.
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In any event, no Additional Amounts or indemnity will be payable with respect to taxes imposed directly or indirectly under FATCA and no
Additional Amounts or indemnity will be payable in excess of the Additional Amounts or indemnity which would be required if the holder of the debt security was a resident of the United States for purposes of, and entitled to claim the benefits
under, the Canada-United States Income Tax Convention (1980), as amended.
Wherever in the Indenture there is mentioned, in any context,
the payment of principal (and premium, if any), interest or any other amount payable under or with respect to a Security, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context,
Additional Amounts are, were or would be payable in respect thereof.
Tax Redemption
The debt securities will be subject to redemption in whole, but not in part, at our option, at any time, on not less than 30 nor more than 60
days prior written notice, at 100% of the principal amount, together with accrued interest thereon to the redemption date, in the event we determine that it is probable that we have become or would become obligated to pay, on the next date on
which any amount would be payable with respect to the debt securities, any Additional Amounts as a result of an amendment to or change in the laws (including any regulations promulgated thereunder) of Canada (or any political subdivision or taxing
authority thereof or therein), or any amendment to or change in any official position regarding the application or interpretation of such laws or regulations, which change is announced or becomes effective on or after the date of this prospectus.
Modification and Waiver
The
Indenture permits us and the Trustee to enter into supplemental indentures without the consent of the holders of the Securities to, among other things: (a) secure the Securities of one or more series, (b) evidence the assumption by the
Successor of our covenants and obligations, under the Indenture and the Securities then outstanding, (c) add covenants or Events of Default for the benefit of the holders of one or more series of the Securities or surrender any right or power
conferred upon us by the Indenture, (d) cure any ambiguity or correct or supplement any defective provision in the Indenture which correction will not be prejudicial to the interests of the holders of the Securities in any material respect,
(e) establish the form and terms of the Securities of any series, (f) evidence the acceptance of appointment by a successor Trustee, and (g) make any other modifications which will not be prejudicial to the interests of the holders of
the Securities in any material respect.
The Indenture also permits us and the Trustee, with the consent of the holders of a majority in
aggregate principal amount of the Securities of each series then outstanding and affected (voting as one class), to add any provisions to, or change in any manner or eliminate any of the provisions of, the Indenture or modify in any manner the
rights of the holders of the Securities of each such affected series; provided, however, that we and the Trustee may not, among other things, without the consent of the holder of each Security then outstanding and affected thereby: (a) change
the stated maturity of the principal amount of, or any installment of the principal of or the interest on, that Security; (b) reduce the principal amount of or the rate of interest on or any premium payable upon the redemption of that Security;
(c) reduce the amount of principal of an original issue discount Security payable upon acceleration of the maturity thereof; (d) change the place or currency of payment of the principal of or any premium or interest on that Security;
(e) impair the right to institute suit for the enforcement of payment of this kind with respect to that Security on or after the stated maturity thereof; or (f) reduce the
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percentage in principal amount of the outstanding Securities of the affected series, the consent of whose holders is required for modification or amendment of the Indenture, or for any waiver
with respect to defaults, breaches, Events of Default or declarations of acceleration.
The holders of a majority in aggregate principal
amount of the Securities of all series at the time outstanding with respect to which a default or breach or an Event of Default shall have occurred and be continuing (voting as one class) may on behalf of the holders of all such affected Securities
waive any past default or breach or Event of Default and its consequences, except a default in the payment of the principal of or premium or interest on any Security of any series or an Event of Default in respect of a covenant or provision of the
Indenture or of any Security which cannot be modified or amended without the consent of the holder of each Security affected.
Defeasance
The Indenture provides that, at our option, we will be discharged from any and all obligations with respect to the Securities of any series
(except for certain obligations to execute and deliver definitive Securities of that series, to register the transfer or exchange of the Securities of that series, to replace mutilated, destroyed, lost or stolen Securities of that series, to
maintain paying agencies, to compensate and indemnify the Trustee and to maintain the trust described below) (hereinafter called a defeasance) upon the irrevocable deposit with the Trustee, in trust, of money, and/or securities of the
government which issued the currency in which the Securities of that series are payable or securities backed by the full faith and credit of that government which, through the payment of the principal thereof and the interest thereon in accordance
with their terms, will provide money, in an amount sufficient, in the opinion of a nationally recognized firm of independent chartered accountants, to pay all the principal of and any premium and interest on the Securities of that series on the
stated maturity of those payments in accordance with the terms of the Securities of that series. Such a defeasance may be effected only if, among other things, (a) we have delivered to the Trustee an opinion of counsel (who may be our
independent counsel) stating that we have received from, or there has been published by, the Internal Revenue Service a ruling or there has been a change in the applicable laws or regulations, in either case to the effect that the holders of the
Securities of that series should not recognize income, gain or loss for United States federal income tax purposes as a result of that defeasance and should be subject to United States federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if that defeasance had not occurred, and (b) we have delivered to the Trustee an opinion of counsel in Canada (who may be our independent counsel) or a ruling from the Canada Revenue Agency to the
effect that the holders of the Securities of that series should not recognize income, gain or loss for Canadian federal or provincial income or other Canadian tax purposes as a result of that defeasance and should be subject to Canadian federal or
provincial income and other Canadian tax on the same amounts, in the same manner and at the same times as would have been the case if that defeasance had not occurred (and for the purposes of such opinion, such Canadian counsel shall assume that
holders of the Securities include holders who are not resident in Canada). In addition, we may obtain a discharge of the Indenture with respect to the Securities of all series issued under the Indenture by depositing with the Trustee, in trust, an
amount of money and government securities as shall be sufficient, in the opinion of a nationally recognized firm of independent chartered accountants, to pay, at stated maturity or upon redemption, all of those Securities, provided that those
Securities are by their terms to become due and payable within one year or are to be called for redemption within one year.
The Indenture
also provides that we may omit to comply with the restrictive covenants described under the caption Negative Pledge and certain other covenants and no Event of Default shall arise with respect to the Securities of that series by reason
of this failure to comply (hereinafter called a covenant defeasance), upon the irrevocable deposit with the Trustee, in trust, of money and/or securities of the government which issued the currency in which the Securities of that series
are payable or securities backed by the full faith and credit of that government which, through the payment of the principal thereof and the interest thereon in accordance with their terms, will provide money, in an amount sufficient, in the opinion
of a nationally recognized firm of independent chartered accountants, to pay all the principal of and any premium and interest on the Securities of that series on the stated maturity of those payments in accordance with the terms of the Securities
of that series. Our other
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obligations with respect to the Securities of that series would remain in full force and effect. A covenant defeasance may be effected only if, among other things, (a) we have delivered to
the Trustee an opinion of counsel (who may be our independent counsel) to the effect that the holders of Securities of that series should not recognize income, gain or loss for United States federal income tax purposes as a result of the covenant
defeasance and should be subject to United States federal income tax on the same amounts, in the same manner and at the same times as would have been the case if that covenant defeasance had not occurred, and (b) we have delivered to the
Trustee an opinion of counsel in Canada (who may be our independent counsel) or a ruling from the Canada Revenue Agency to the effect that the holders of the Securities of that series should not recognize income, gain or loss for Canadian federal or
provincial income or other Canadian tax purposes as a result of that defeasance and should be subject to Canadian federal or provincial income and other Canadian tax on the same amounts, in the same manner and at the same times as would have been
the case if that defeasance had not occurred (and for the purposes of such opinion, such Canadian counsel shall assume that holders of the Securities include holders who are not resident in Canada).
In the event that we exercise our option to effect a covenant defeasance with respect to the Securities of any series and the Securities of
that series are thereafter declared due and payable because of the occurrence of another Event of Default, the amount of money and securities on deposit with the Trustee would be sufficient to pay the amounts due on the Securities of that series at
their respective stated maturities, but may not be sufficient to pay the amounts due on the Securities of that series at the time of the acceleration resulting from that Event of Default. However, we would remain liable for this deficiency.
Consent to Service
We have designated C
T Corporation System, 111 Eighth Avenue, New York, New York, 10011 as our authorized agent for service of process in the United States in any action, suit or proceeding arising out of or relating to the Indenture or the Securities and for actions
brought under federal or state securities law in any federal or state court located in the Borough of Manhattan, New York, New York and irrevocably submit to the non-exclusive jurisdiction of any such court.
Governing Law
The Indenture and the
Securities will be governed by and construed in accordance with the laws of the State of New York.