**EXHIBITNO. 3:   Restated Articles of Incorporation**

**FORM 7**

**Canada Business Corporations Act**

**RESTATED ARTICLES OF INCORPORATION(Section 180 CBCA)**

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**1.                 NAME OF CORPORATION:**

The name of theCorporation is:

ALCAN INC.No. 310145-2

**2.                 REGISTERED OFFICE:**

The registeredoffice of the Corporation is situated in the City of Montreal, in the Provinceof Quebec, Canada.

**3.         CAPITAL:**

The class of sharesand, where applicable, the maximum number of shares that the Corporation isauthorized to issue are set out below and the rights, privileges, restrictionsand conditions attaching to each class of shares of the Corporation are set outin Schedule 1 annexed hereto:

            A.         An unlimited number of Preference Shareswithout nominal or par value, issuable in series [*See Schedule 1, Part A*], of which:

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i)         the thirdseries consists of 4,200,000 Floating Rate Cumulative Redeemable Preference,Series C, 1984 Issue [*See Schedule 1,Part A.1*]; 

ii)        the fifthseries consists of 1,500,000 Floating Rate Cumulative Redeemable  Preference Shares, Series C, 1985 Issue [*See Schedule 1, Part A.2*];   

iii)       the seventhseries consists of 3,000,000 Cumulative Redeemable Preference Shares, Series E[*See Schedule 1, Part A.3*];

B.                An unlimitednumber of Common Shares without nominal or par value [*See Schedule 1, Part B*].

**4.                 RESTRICTIONS ON SHARE TRANSFERS:**

There are norestrictions on the transfer of shares of the Corporation.

 

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**5.         NUMBER OF DIRECTORS:**

The number ofDirectors of the Corporation shall be a minimum of nine and a maximum of 20.

The Directors mayappoint one or more additional Directors (above the number elected at theprevious Annual Meeting) who shall hold office for a term expiring not laterthan the close of the next Annual Meeting provided that the total number ofDirectors so appointed may not exceed one-third of the number of Directorselected at the said previous Annual Meeting.

**6.         RESTRICTIONSON BUSINESS:**

            Thereare no restrictions on the business that the Corporation may carry.

**7.                 OTHER:**

Without theconsent given by way of special resolution of the holders of the Common Shares,there shall not be created or issued any series of Preference Shares to whichare attached voting rights other than voting rights arising only in the eventof non-payment of dividends thereon.

Meetings ofShareholders shall be held at such place within Canada as the Directors of theCorporation may determine, or outside of Canada, if so determined by theDirectors, in New York City, United States of America, in London, England, orin Zurich, Switzerland.

The foregoingRestated Articles of Incorporation correctly set out, without substantivechange, the corresponding provisions of the previous Articles of Amalgamationdated January 1, 1995, as amended, and supersede the said previous Articles ofAmalgamation.

| Dated this 12th day of September 2002 | /s/Roy Millington                  RoyMillington |
|---------------------------------------|------------------------------------------------------------------------------------------------------------------------|
|                                  | Corporate Secretary                                                                                                    |

 

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**SCHEDULE 1**

The rights,privileges, restrictions and conditions attaching to the Preference Shareswithout nominal or par value, issuable in series; and Common Shares withoutnominal or par value shall be as set out in this schedule.

**PART A**

**An unlimitednumber of Preference Shares without nominal or par value, issuable in series**

**Provisions ofPreference Shares as a class**

The Preference Shares shall, as a class, carry andbe subject to the following rights, privileges, restrictions and conditions:

(a)  The Preference Shares may be issued at anytime or from time to time in one or more series, each series consisting of suchnumber of shares and having such preferred, deferred or other special rights,restrictions, conditions, limitations or designations attaching theretoincluding, without limiting the generality of the foregoing, such rates,amounts or methods of calculation of cumulative preferred dividends, redemptionprice, conversion rights (if any), sinking or purchase fund (if any),retraction provisions (if any), voting rights, and provisions for the amendmentof such rights, restrictions, conditions, limitations or designations (thewhole subject to the rights, privileges, restrictions and conditions attachingto the Preference Shares as a class) as shall be prescribed from time to timebefore issuance by any resolution providing for the issue of the PreferenceShares of any series which may be passed by the Directors of the Corporation.

(b)  The rights, privileges, restrictions andconditions attaching to the Preference Shares shall be subject and subordinateto those attaching to the First Preferred Shares and to the Second PreferredShares, but only to the extent that they may conflict therewith.

(c)  The Preference Shares of each series shallrank *pari passu* with the PreferenceShares of every other series and shall be entitled to preference over theCommon Shares and over any other shares ranking junior to the Preference Shareswith respect to payment of dividends or distribution of assets in the event ofthe liquidation, dissolution or winding up of the Corporation, whethervoluntary or involuntary, or any other distribution of the assets of theCorporation among its shareholders for the purpose of winding up its affairs.

(d)  Subject to the provisions of paragraph (b)hereof, the holders of the Preference Shares shall be entitled to receive andthe Corporation shall pay thereon as and when declared by the Directors of theCorporation, out of the moneys of the Corporation properly applicable to thepayment of dividends, cumulative, preferential, cash dividends at such rates,in such amounts or by such methods of calculation, in such currencies andpayable at such intervals as shall have been prescribed for each series. Suchdividends shall accrue from such date as may in the case of each series bedetermined by the Directors of the Corporation, or in case no date be so determined, then from the date of issue thereof.Cheques of the Corporation, payable at par at any branch in Canada or theUnited States of America of a bank from time to time selected by the Directorsof the Corporation shall be issued in respect of such dividends (less any taxesrequired to be deducted) and payment thereof shall satisfy such dividends. Adividend that is represented by a cheque which has not been presented to theCorporation's bankers for payment or that otherwise remains unclaimed for a periodof six years from the date on which it was declared to be payable shall beforfeited to the Corporation. With respect to each series of Preference Shares,dividends shall be paid to the registered holders appearing on the register atthe close of business on such a day preceding the day fixed for the payment ofdividends as may be determined from time to time by the Directors of theCorporation.

(e)  Subject to the provisions of the CanadaBusiness Corporation Act as from time to time amended ("Act"), theprovisions of paragraph (b) hereof and the provisions relating to anyparticular series, the Corporation may at any time or from time to time, at itsoption, purchase (if obtainable) for cancellation out of capital or otherwisepursuant to the Act, the whole or any part of the Preference Shares or any oneor more series outstanding from time to time in the open market (includingpurchase through or from any investment dealer or firm holding membership on arecognized stock exchange), by invitation for tenders addressed to all holdersof record of the series of Preference Shares proposed to be purchased or byprivate contract at the lowest price or prices at which, in the opinion of theTreasurer or an assistant Treasurer of the Corporation, such shares are obtainablebut not exceeding the price at which such shares could be redeemed at the timeof purchase or, if not then callable for redemption, on the date of their firstbecoming redeemable, together with an amount equal to all dividends, if any,accrued thereon up to the date of purchase and then remaining unpaid, whetheror not earned or declared (which dividends, for such purpose, shall becalculated as if they were accruing from day to day up to the date of purchase)plus costs of purchase. If upon any invitation for tenders, more PreferenceShares are tendered at a price or prices acceptable to the Corporation than theCorporation is then prepared to purchase, the Corporation will accept, to theextent required, the tenders submitted at the lowest price and then, if and tothe extent required, the tenders submitted at the next progressively higherprices, and if more shares are tendered at any such price than the Corporationis prepared to purchase, the shares tendered at that price shall be purchased asnearly as possible *pro rata*(disregarding fractions) according to the number of Preference Shares sotendered by each holder thereof. From and after the date of purchase thePreference Shares so purchased shall be cancelled and shall not be reissued.

 

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(f)   Subject to the provisions of the Act, theprovisions of paragraph (b) hereof and the provisions relating to anyparticular series, the Corporation may, upon giving notice as hereinafterprovided, redeem out of capital or otherwise pursuant to the Act at any timethe whole or from time to time any part of the then outstanding PreferenceShares of any series at such redemption price as shall have been prescribed forsuch series, together with an amount equal to all dividends, if any, accruedthereon up to the date fixed for redemption and then remaining unpaid, whetheror not earned or declared (which dividends, for such purpose, shall becalculated as if they were accruing from day to day up to and including thedate fixed for redemption). In case a part only of the Preference Shares of anyseries is to be redeemed, the shares of such series to be redeemed shall beselected by lot in such manner as the Directors of the Corporation maydetermine or if the Directors so determine, may be redeemed pro rata disregardingfractions and the Directors may make such adjustments as may be necessary toavoid redemption of fractional parts of shares. In the case of any redemptionof Preference Shares, notice in writing of such redemption of such number ofdays as shall have been prescribed for each series and failing suchprescription of not less than 90 days shall be given by mailing such notice toeach registered holder who at the time of the mailing is a registered holder ofPreference Shares to be redeemed, at his address as it appears on the books ofthe Corporation, or in the event of the address of any such shareholder not soappearing, then to the last known address of such shareholder; provided,however, that accidental failure to give any such notice to one or more of suchholders shall not affect the validity of such redemption as to the otherholders. Such notice shall set out the redemption price, the place or places atwhich the redemption price is to be paid and the date on which redemption is totake place, and, if part only of the Preference Shares held by the person towhom it is addressed is to be redeemed, the number thereof so to be redeemed.On or before the date so fixed for redemption, the Corporation shall depositthe redemption price of the Preference Shares to be redeemed in the bank ortrust company specified in the notice of redemption, to be paid withoutinterest to or to the order of the respective holders of such Preference Sharesupon presentation and surrender to such bank or trust company of thecertificates representing the same. Provided such deposit shall have been made,such Preference Shares so called for redemption shall on the date fixed forredemption be deemed to be redeemed, shall cease to be entitled to dividendsand the holders thereof shall cease to be entitled to exercise any of therights of shareholders in respect thereof. If the redemption price shall not bedeposited as aforesaid, the rights of the holders of the Preference Shares socalled for redemption shall remain unaffected. From and after the date fixedfor redemption, the Preference Shares so redeemed shall be deemed cancelled andshall not be reissued.

(g)  Except as set forth in paragraph (h) andsubject to the provisions relating to any particular series, the holders ofPreference Shares shall not be entitled as such to receive notice of or toattend any meeting of the shareholders of the Corporation or to vote at anysuch meeting.

(h)  The provisions contained in paragraphs (a) to(g) and in this paragraph (h) may be repealed or amended in whole or in partbut only with the approval of the holders of the Preference Shares, except thatwithout such approval the Directors of the Corporation may change thedesignation of the Preference Shares or any series thereof. The approval of theholders of the Preference Shares as to any and all matters hereinbeforereferred to may be given in writing by all the holders of the outstandingPreference Shares or by resolution passed or by‐law sanctioned at ameeting of holders of Preference Shares duly called for the purpose and heldupon at least 21 days' notice at which the holders of at least 50% of theoutstanding Preference Shares are present or represented by proxy and carriedby not less than two‐thirds of the votes cast on a poll at such meeting.If at any such meeting the holders of 50% of the outstanding Preference Sharesare not present or represented by proxy within half an hour after the timeappointed for the meeting then the meeting shall be adjourned to such datebeing not less than 15 days later and to such time and place as may beappointed by the shareholders present and at least ten days' notice shall begiven of such adjourned meeting, but it shall not be necessary in such noticeto specify the purpose for which the meeting was originally called. At suchadjourned meeting, the holders of Preference Shares present or represented byproxy may transact the business for which the meeting was originally convened,and a resolution passed thereat by not less than two‐thirds of the votescast on a poll at such adjourned meeting shall constitute the approval of theholders of the Preference Shares referred to above.

If the repeal or amendment ofthe provisions hereinbefore contained affects the rights of the holders ofPreference Shares of any series in a manner different from that in or to whichthe rights of the holders of Preference Shares of any other series areaffected, then such repeal or amendment shall, in addition, be approved by theholders of the Preference Shares of such series so affected, and the provisionsof this paragraph (h) shall apply, *mutatismutandis*, with respect to the giving of such approval.

 

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Any meeting of the holders of the outstandingPreference Shares may be held at any time and for any purpose, without notice,if all holders of Preference Shares entitled to vote at the meeting waivenotice of the meeting in writing. For the purpose of waiver of notice, thewords "in writing" shall, without limitation, include the sending ofa telegram, telex, cable or any other form of written communication by ashareholder. Any holder of Preference Shares may waive notice of any meetingeither before or after the meeting is held.

Irregularities in the notice or in the givingthereof as well as the accidental omission to give notice of any meeting to, or the non‐receipt of any notice by, any holder ofPreference Shares, shall not invalidate any action taken at any meeting.

At any meeting of the holders of Preference Shares,without distinction as to series, each holder shall be entitled to one vote inrespect of each dollar of issue price of Preference Shares held by him, whethersuch issue price is in Canadian or United States currency. At any meeting ofthe holders of Preference Shares of any particular series, each holder shall beentitled to one vote in respect of each Preference Share of such series held byhim.

The formalities to be observed with respect to thegiving notice of any meeting of holders of Preference Shares and the conductthereof shall be those from time to time prescribed in the by‐laws of theCorporation with respect to meetings of shareholders.

 

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**PART A.1**

**Provisions ofthe third series of Preference Shares consisting of 4,200,000 Floating RateCumulative Redeemable Preference Shares, Series C, 1984 Issue** (hereinafter referred to as"Series C Preference Shares")

The Series C Preference Shares shall, in addition tothe rights, privileges, restrictions and conditions attaching to the PreferenceShares as a class, have the following rights, privileges, restrictions andconditions:

**1. Issue Price**

TheSeries C Preference Shares willhavean issue price of $25.00 each.

**2. Dividends**

2.1  The holders of Series C Preference Shares willbe entitled to receive a quarterly cumulative preferential cash dividend, asand when declared by the Board of Directors of the Corporation, on the 20th dayof February, May, August and November in each year ("Dividend PaymentDates") in an amount per share determined by applying to the $25.00 issueprice per share one‐quarter of the Annual Dividend Rate applicable to theQuarter preceding the Dividend Payment Date for which the determination isbeing made. The record date for the payment of dividends willbe the 5th day of February, May, Augustand November or any other day, chosen by the Board of Directors, which is notmore than 30 days preceding the Dividend Payment Date.

The initial dividend will bepayable on November 20, 1984 to holders of record on November 5, 1984 in anamount per share determined by applying to $25.00 the Annual Dividend Rateapplicable to the period from the date of issue to September 30, 1984multiplied by the number of days following the date of issue through November20, 1984, all divided by 365.

"*Annual Dividend Rate*" applicable to a Quarter is the greaterof (i) 72% of Canadian Prime and (ii) the lesser of 7.5% and Canadian Prime.

"*Quarter*" is a period of three consecutive calendar monthscommencing on the first day of any of January, April, July or October."Quarter" shall also mean the period from the date of issue toSeptember 30, 1984.

"*Canadian Prime*" for a Quarter is the average of the PrimeInterest Rates in effect on each day of that Quarter.

"*Prime Interest Rate*" is the average of the annual rates ofinterest announced from time to time by The Royal Bank of Canada and TheToronto‐Dominion Bank as reference rates then in effect for determininginterest rates on Canadian dollar commercial loans in Canada. In the event thatfor any reason one of the said banks does not have a Prime Interest Rate ineffect during all of a Quarter, then the Prime Interest Rate for such bank forsuch Quarter shall be the Prime Interest Rate of the other bank. In the eventthat both of the said banks do not have a Prime Interest Rate in effect duringall of a Quarter, then the Prime Interest Rate for that Quarter shall be equalto 1.65% per annum plus the average during such Quarter of the average yieldsat weekly tender on 91‐day Government of Canada Treasury Bills asreported by the Bank of Canada.

In any case where a dividendis payable for a period that ends on a date ("reference date") otherthan a Dividend Payment Date, the amount of such dividend shall be determinedby applying to $25.00 the Annual Dividend Rate applicable to the Quarter precedingthe reference date multiplied by the number of days following the DividendPayment Date preceding the reference date through the reference date, alldivided by 365.

2.2  In these provisions, "accrued and unpaiddividends" means an amount computed at the applicable rates as thoughdividends had been accruing on a day‐to‐day basis from the date ofissue to the date to which the computation of accrued dividends is to be made,after deducting all dividend payments made.

 

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**3. Redemption**

The Series C Preference Shares shall not beredeemable on or before December 31, 1987, but thereafter shall be redeemableat the option of the Corporation on at least 30 days' notice prior to the datefixed for redemption in whole at any time or in part from time to time onpayment of the following redemption prices in Canadian currency for each shareto be redeemed:

If redeemed in the 12 monthsending                  RedemptionPrice

December 31,1988..................................................$26.50December 31,1989..................................................$26.20December 31,1990..................................................$25.90December 31,1991..................................................$25.60December 31,1992..................................................$25.30and thereafter............................................................$25.00

together in each case with an amountequal to all accrued and unpaid dividends to the date fixed for redemption. Incase a part only of the Series C Preference Shares is to be redeemed, theshares to be redeemed shall be selected by lot in such manner as the Board ofDirectors shall by resolution determine.

**4. Creation orIssue of Additional Shares**

So long as any of the Series C Preference Shares areoutstanding, the Corporation shall not, without the prior approval of theholders of the Series C Preference Shares given as hereinafter specified,create or issue any shares ranking prior to or on a parity with the Series CPreference Shares with respect to return of capital or payment of dividends,provided that the Corporation may without such approval, if all dividends thenpayable on the Series C Preference Shares shall have been declared and paid orset apart for payment, (i) issue additional series of Preference Shares and(ii) create additional series of First Preferred Shares or Second PreferredShares to be issued upon the exercise of a right of conversion which mayhereafter be attached to the 1975 Series Preferred Shares or the Series BSecond Preferred Shares or Series C Second Preferred Shares, as the case maybe, provided that the date of retraction at the option of the holder attachedto such additional series shall not be earlier than December 31, 1989 except,with respect to the additional Second Preferred Shares, in the circumstancesreferred to in paragraph 5 of the provisions relating to the Series B and CSecond Preferred Shares.

**5. Restrictionson Dividends, Retirement of Shares and Certain Investments**

5.1  So long as any of the Series C PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the Series C Preference Shares given as hereinafterspecified, declare any dividends on any class of its Common Shares (other thandividends payable solely in such shares) to, or make any payment on account ofthe purchase, redemption or other retirement of any shares of any class to, ormake any distribution in respect thereof to, or make or permit any subsidiaryto make any Investment in, or permit to exist any extended Short‐TermInvestment in, the Parent Corporation or any subsidiary thereof (other than theCorporation or a Subsidiary) either directly or indirectly, unless any suchdividends are declared to be payable not more than 120 days after the day ofdeclaration, and unless (a) all dividends then payable on the Series C PreferenceShares shall have been declared and paid or set apart for payment and (b) aftergiving effect to such proposed dividend or other payment or distribution orInvestment and the application of the proceeds thereof and to any otherdividends declared but not yet paid, at the Computation Date, the sum of:

(i)   $350,000,000 in United States currency plus (or minus in the caseof a deficit),

(ii)   the Consolidated Net Income of the Corporation and itsSubsidiaries computed for the period commencing January 1, 1982 to andincluding a date not more than 135 days prior to the Computation Date, plus

(iii)  the aggregate amount of the net cashproceeds to the Corporation from sales subsequent to December 31, 1981 ofshares of its capital stock,

shall be greater than the sum of the aggregateamount of all such dividends and all such other payments and distributionsdeclared or made during the period commencing January 1, 1982 to and includingthe Computation Date, plus the net amount of Investment outstanding on suchdate, provided however that with regard to the foregoing restrictions of thisparagraph 5.1, the Corporation may purchase, redeem or retire any shares of anyclass by exchange for or out of the proceeds of the substantially concurrentsale of other shares ranking either (1) junior to the Series C PreferenceShares, or (2) equally with or junior to the shares being purchased, redeemedor retired and neither any such purchase, redemption or retirement nor any suchproceeds shall be included in any computation provided for in this paragraph5.1.

 

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Forthe purposes of this paragraph 5.1, all sums shall be determined in UnitedStates currency.

Asused in this paragraph 5.1, the following terms shall have the meanings setforth below:

"*ComputationDate*" shall mean (i) in the case of a dividend, the date of thedeclaration thereof, (ii) in the case of any payment on account of thepurchase, redemption or retirement of, or any distribution with respect to,shares, or any Investment, the date of the making thereof and (iii) in the caseof extended Short-Term Investment, any date.

"*ConsolidatedNet Income*" shall mean the Net Income of the Corporation and itsSubsidiaries, all consolidated in accordance with generally accepted accountingprinciples. The Consolidated Net Income of the Corporation and its Subsidiariescomputed for the period commencing January 1, 1982 to and including a date notmore than 135 days prior to any Computation Date shall conclusively be deemedto be that shown by an interim statement of the Consolidated Net Income of theCorporation and its Subsidiaries for such period prepared by the Corporation.

"*Investment*"shall mean all loans, advances and capital contributions in cash to any Person,and all cash payments in respect of the purchase from any Person of evidencesof indebtedness, capital stock or other securities of such Person, but shallnot include any Short-Term Investment.

"*Short-TermInvestment*" shall mean all Investments repayable on demand or withinone year from the making thereof. "Net Amount of Short-TermInvestment" outstanding on any day shall mean all Short-Term Investmentsby the Corporation or any Subsidiary in the Parent Corporation or anysubsidiary thereof (other than a Subsidiary), less the aggregate amount of allcash received by the Corporation or any Subsidiary as payments of principal orpremium, returns of capital, liquidation dividends or distributions, proceedsof sale or other dispositions, or otherwise, in respect of such Short-TermInvestments (except to the extent any such cash has been included in theConsolidated Net Income of the Corporation and its Subsidiaries), during theperiod commencing January 1, 1982 to and including such day. "Net Amountof Investment" outstanding on any day shall mean all Investments by theCorporation or any Subsidiary in the Parent Corporation or any subsidiarythereof (other than a Subsidiary), less the aggregate amount of all cashreceived by the Corporation or any Subsidiary, as payments of principal orpremium, returns of capital, liquidation dividends or distributions, proceedsof sale or other dispositions, or otherwise, in respect of such Investments(except to the extent any such cash has been included in the Consolidated NetIncome of the Corporation and its Subsidiaries), during the period commencingJanuary 1, 1982 to and including such day, provided, however, that Net Amountof Investment shall include extended Short-Term Investment. "ExtendedShort-Term Investment" shall mean the highest Net Amount of Short-TermInvestment outstanding during any period of 30 consecutive days within the 12months preceding the date of determination, such 30‐day period to beselected by the Corporation.

"*NetIncome*" of any corporation for any period shall mean the net income(or net deficit) of such corporation for such period, determined in accordancewith generally accepted accounting principles.

"*ParentCorporation*" shall mean any corporation which owns, together with itssubsidiaries, at least a majority of the outstanding Voting Stock of theCorporation.

"*Person*"shall mean any individual, corporation, partnership, joint venture,association, joint‐stock company, trust, unincorporated organization orgovernment or any agency or political subdivision thereof.

"*Stock*"shall include any and all shares, interests, participations or otherequivalents (however designated) of corporate stock, and the term "VotingStock", as applied to the stock of any corporation, shall mean Stock ofany class or classes (however designated) having ordinary voting power for theelection of a majority of the members of the Board of Directors (or othergoverning body) of such corporation, other than Stock having such power only byreason of the happening of a contingency.

"*subsidiary*" shall mean any corporation at least amajority of whose outstanding Voting Stock shall at the time be owned byanother corporation or by one or more subsidiaries of such other corporation orby such other corporation and one or more subsidiaries thereof.

"*Subsidiary*" shall mean a subsidiaryof the Corporation.

5.2   So long as any of the Series C PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the Series C Preference Shares given as hereinafterspecified:

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(a)  pay any dividends (other than stock dividends)or make any distributions on any shares of the Corporation ranking junior tothe Series C Preference Shares with respect to payment of dividends or returnof capital, or

(b)  retire for value any shares of the Corporationranking junior to the Series C Preference Shares with respect to payment ofdividends or return of capital, or

 

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(c)  except in connectionwith the exercise ofthe retractionprivilege attaching thereto. retire less than all theSeries C Preference Shares,

unless all dividends then payableon the Series C Preference Shares shall have been declared and paid or setapart for payment.

**6. VotingRights**

6.1   The holders of the Series C Preference Sharesshall not be entitled as such (except as hereinafter specifically provided) toreceive notice of or to attend any meeting of the shareholders of theCorporation or to vote at any such meeting unless and until the Corporationfrom time to time shall fail to pay in the aggregate six quarterly dividends onthe Series C Preference Shares on the dividend payment dates whether or notconsecutive and whether or not such dividends have been declared and whether ornot there are any moneys of the Corporation properly applicable to the paymentof dividends. Thereafter, but only so long as any dividends on the Series CPreference Shares remain in arrears, the holders of the Series C PreferenceShares shall be entitled to receive notice of and to attend, but not to voteat, all meetings of shareholders of the Corporation and shall be entitled onany election of Directors, together with holders of shares of all other seriesof Preference Shares having the right to vote in similar circumstances, votingseparately and exclusively as a class, to elect two members of the Board of Directorsof the Corporation. Each holder of Preference Shares entitled to so vote shallbe entitled to one vote in respect of each dollar of issue price of PreferenceShares held by him whether such issue price is in Canadian or United Statescurrency. Nothing herein contained shall be deemed to limit the right of theCorporation from time to time to increase or decrease the number of itsDirectors.

6.2*  *Notwithstandinganything contained in the by‐laws of the Corporation, the term of officeof all persons who may be Directors of the Corporation at any time when theright to elect Directors shall accrue to the holders of Series C PreferenceShares as herein provided, or who may be appointed as Directors thereafter andbefore a meeting of shareholders shall have been held, shall terminate upon theelection of Directors at the next annual meeting of shareholders or at anearlier general meeting of shareholders which may be held for the purpose ofelecting Directors and which shall be called by the Secretary of theCorporation upon the written request of the holders of record of at least one‐tenthof the outstanding Series C Preference Shares. In default of the calling of such general meeting by the Secretarywithin 15 days after the making of such request, such meeting may be called byany holder of record of Series A Preference Shares.

6.3*  *Anyvacancy occurring among members of the Board elected by the holders ofPreference Shares may be filled by the Board of Directors with the consent andapproval of the remaining Director elected by the holders of Preference Shares.Whether or not such vacancy is so filled by the Board, the holders of record ofat least one‐tenth of the outstanding Series C Preference Shares shallhave the right to require the Secretary of the Corporation to call a meeting ofthe holders of Preference Shares for the purpose of filling the vacancy orreplacing any person elected or appointed by the Board of Directors to fillsuch vacancy and the provisions of paragraph 6.2shall apply with respect to the calling of any such meeting.

6.4*  *Notwithstandinganything contained in the by‐laws of the Corporation upon any terminationof the said right to elect Directors, the term of office of the Directorselected or appointed to represent the holders of Preference Shares exclusivelyshall forthwith terminate.

**7. Rights onLiquidation**

In the event of the liquidation, dissolution orwinding‐up of the Corporation or other distribution of assets of theCorporation among shareholders for the purpose of winding up its affairs, theholders of the Series C Preference Shares shall be entitled to receive (i) thesum of $25.00 in Canadian currency per share together with all accrued andunpaid dividends up to and including the date of distribution, and (ii) if suchliquidation, dissolution, winding‐up or distribution shall be voluntary,an additional amount equal to the premium, if any, which would have beenpayable on the redemption of the Series C Preference Shares if they had beencalled for redemption by the Corporation (a) on the date of distribution, or(b) if not then callable for redemption, on the date of their first becomingredeemable, before any amount shall be paid to, or any property or assets ofthe Corporation distributed among, the holders of any shares of the Corporationranking junior to the Series C Preference Shares. After payment to the holdersof the Series C Preference Shares of the amounts so payable to them, they shallnot be entitled to share in any further distribution of the property or assetsof the Corporation.

**8. Amendments**

The rights, privileges, restrictions and conditionsattaching to the Series C Preference Shares may be repealed or amended in wholeor in part but only with the approval of the holders of the Series C PreferenceShares, given as hereinafter specified; provided, however, that the Directorsof the Corporation may at any time or from time to time, without suchshareholder approval, but subject to the provisions of any applicable law,attach the right, exercisable at the option of the holder, to convert on suchterms and conditions and in such manner as the Directors shall determine eachSeries C Preference Share into a Preference Share of another series.

 

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**9. Approvals**

9.1  The approval of the holders of the Series CPreference Shares as to any and all matters hereinbefore referred to may begiven in writing by all the holders of the outstanding Series C PreferenceShares or by resolution passed or by‐law sanctioned at a meeting ofholders of Series C Preference Shares duly called for the purpose and held uponat least 21 days' notice at which the holders of at least 50% of theoutstanding Series C Preference Shares are present or represented by proxy andcarried by not less than two‐thirds of the votes cast on a poll at suchmeeting. If at any such meeting the holders of 50% of the outstanding Series CPreference Shares are not present or represented by proxy within half an hourafter the time appointed for the meeting, then the meeting shall be adjournedto such date being not less than 15 days later and to such time and place asmay be appointed by the shareholders present and at least ten days' noticeshall be given of such adjourned meeting, but it shall not be necessary in suchnotice to specify the purpose for which the meeting was originally called. Atsuch adjourned meeting, the holders of Series C Preference Shares present orrepresented by proxy may transact the business for which the meeting wasoriginally convened, and a resolution passed thereat by not less than two‐thirdsof the votes cast on a poll at such adjourned meeting shall constitute theapproval of the holders of the Series C Preference Shares referred to above.

9.2  Irregularities in the notice or in the givingthereof as well as the accidental omission to give notice of any meeting to, or the non‐receipt of any notice by, any holder ofSeries C Preference Shares, shall not invalidate any action taken at anymeeting.

9.3  The formalities to be observed with respect tothe giving of notice of any meeting of holders of Series C Preference Sharesand the conduct thereof shall be those from time to time prescribed in the by‐lawsof the Corporation with respect to meetings of shareholders.

 

 

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**10. Notices**

Any notice required to be given under the provisionsattaching to the Series C Preference Shares to the holders thereof shall begiven by posting the same in a postage‐paid envelope addressed to eachholder at the last address of such holder as it appears on the books of theCorporation or, in the event of the address of any such holder not soappearing, then to the address of such holder last known to the Corporation;provided that accidental failure or omission to give any notice as aforesaid toone or more of such holders shall not invalidate any action or proceedingfounded thereon. In the event of a threatened or actual disruption in the mailservice, notice as aforesaid shall be given to registered holders of Series CPreference Shares by means of publication twice in successive weeks in a dailynewspaper of general circulation in each of the cities of Halifax, Montreal,Toronto, Winnipeg, Regina, Calgary and Vancouver. Publication in each week ineach newspaper shall be made within a period of seven days of publication ineach other newspaper. If at any time any notice is required under theprovisions of this paragraph 10 to be published in a particular city and nonewspaper of general circulation is then being published and circulated on adaily basis in that city, the Corporation shall not be required to publish inthat city. Any notice given by mail shall be deemed to be given on the day onwhich it is mailed. Any notice given by publication shall be deemed to be givenon the day on which the first publication is completed in all of the cities inwhich publication is required.

 

 

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**PART A.2**

**Provisions of the fifth series of Preference Shares consisting of1,500,000 Floating Rate Cumulative Redeemable Preference Shares, Series C, 1985Issue**(hereinafter referred to as "1985 Series C Preference Shares").

The 1985 Series C Preference Shares shall, inaddition to the rights, privileges, restrictions and conditions attaching tothe Preference Shares as a class, have the following rights, privileges,restrictions and conditions:

**1. Issue Price**

The1985 Series C Preference Shares will have an issue price of $25.00 each.

**2. Dividends**

2.1  The holders of 1985 Series C Preference Shareswill be entitled to receive a quarterly cumulative preferential cash dividend,as and when declared by the Board of Directors of the Corporation, on the 20thday of February, May, August and November in each year ("Dividend PaymentDates") in an amount per share determined by applying to the $25.00 issueprice per share one‐quarter of the Annual Dividend Rate applicable to theQuarter preceding the Dividend Payment Date for which the determination isbeing made. The record date for the payment of dividends will be the 5th day ofFebruary, May, August and November or any other day, chosen by the Board ofDirectors, which is not more than 30 days preceding the Dividend Payment Date.

The initial dividend will bepayable on August 20, 1985 to holders of record on August 5, 1985 and will accrue from May 20, 1985.

"*Annual Dividend Rate*" applicable to a Quarter is the greaterof (i) 72% of Canadian Prime and (ii) the lesser of 7.5% and Canadian Prime.

"*Quarter*" is a period of three consecutive calendar monthscommencing on the first day of any of January, April, July or October.

"*Canadian Prime*" for a Quarter is the average of the PrimeInterest Rates in effect on each day of that Quarter.

"*Prime Interest Rate*" is the average of the annual rates ofinterest announced from time to time by The Royal Bank of Canada and TheToronto‐Dominion Bank as reference rates then in effect for determining interestrates on Canadian dollar commercial loans in Canada. In the event that for anyreason one of the said banks does not have a Prime Interest Rate in effectduring all of a Quarter, then the Prime Interest Rate for such bank for suchQuarter shall be the Prime Interest Rate of the other bank. In the event thatboth of the said banks do not have a Prime Interest Rate in effect during allof a Quarter, then the Prime Interest Rate for that Quarter shall be equal to1.65% per annum plus the average during such Quarter of the average yields atweekly tender on 91‐day Government of Canada Treasury Bills as reportedby the Bank of Canada.

In any case where a dividendis payable for a period that ends on a date ("reference date") otherthan a Dividend Payment Date, the amount of such dividend shall be determinedby applying to $25.00 the Annual Dividend Rate applicable to the Quarterpreceding the reference date multiplied by the number of days following theDividend Payment Date preceding the reference date through the reference date,all divided by 365.

2.2  In these provisions, "accrued and unpaiddividends" means an amount computed at the applicable rates as thoughdividends had been accruing on a day‐to‐day basis from May 20, 1985to the date to which the computation of accrued dividends is to be made, afterdeducting all dividend payments made.

 

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**3. Redemption**

The 1985 Series C Preference Shares shall not beredeemable before December 31, 1987, but thereafter shall be redeemable at theoption of the Corporation on at least 30 days' notice prior to the date fixedfor redemption in whole at any time or in part from time to time on payment ofthe following redemption prices in United States currency for each share to beredeemed:

Redeemed in the 12 months ending                       RedemptionPrice

December 31,1988.................................................$26.50December 31,1989.................................................$26.20December 31,1990.................................................$25.90December 31, 1991.................................................$25.60December 31,1992.................................................$25.30and thereafter...........................................................$25.00

together in each case with an amountequal to all accrued and unpaid dividends to the date fixed for redemption. Incase a part only of the 1985 Series C Preference Shares is to be redeemed, theshares to be redeemed shall be selected by lot in such manner as the Board ofDirectors shall by resolution determine.

**4. Creation orIssue of Additional Shares**

So long as any of the 1985 Series C PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the 1985 Series C Preference Shares given as hereinafterspecified, create or issue any shares ranking prior to or on a parity with the1985 Series C Preference Shares with respect to return of capital or payment ofdividends, provided that the Corporation may without such approval, if alldividends then payable on the 1985 Series C Preference Shares shall have been declaredand paid or set apart for payment, (i) issue additional series of PreferenceShares and (ii) create additional series of First Preferred Shares or SecondPreferred Shares to be issued upon the exercise of a right of conversion whichmay hereafter be attached to the 1975 Series Preferred Shares or the Series BSecond Preferred Shares or Series C Second Preferred Shares, as the case maybe, provided that the date of retraction at the option of the holder attachedto such additional series shall not be earlier than December 31, 1989 except,with respect to the additional Second Preferred Shares, in the circumstancesreferred to in paragraph 5 of the provisions relating to the Series B and CSecond Preferred Shares.

**5. Restrictionson Dividends, Retirement of Shares and Certain Investments**

5.1  So long as any of the 1985 Series C PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the 1985 Series C Preference Shares given as hereinafterspecified, declare any dividends on any class of its Common Shares (other thandividends payable solely in such shares) to, or make any payment on account ofthe purchase, redemption or other retirement of any shares of any class to, ormake any distribution in respect thereof to, or make or permit any subsidiaryto make any investment in, or permit to exist any Extended Short-TermInvestment in, the Parent Corporation or any subsidiary thereof (other than theCorporation or a Subsidiary) either directly or indirectly, unless any suchdividends are declared to be payable not more than 120 days after the day ofdeclaration, and unless (a) all dividends then payable on the 1985 Series CPreference Shares shall have been declared and paid or set apart for paymentand (b) after giving effect to such proposed dividend or other payment ordistribution or Investment and the application of the proceeds thereof and toany other dividends declared but not yet paid, at the Computation Date, the sumof:

> 
(i)   $350,000,000 in United States currency plus (or minus in the caseof a deficit),

(ii)   the Consolidated Net Income of the Corporation and itsSubsidiaries computed for the period commencing January 1, 1982 to andincluding a date not more than 135 days prior to the Computation Date, plus

(iii)  the aggregate amount of the net cashproceeds to the Corporation from sales subsequent to December 31, 1981 ofshares of its capital stock,

shall be greater than the sumof the aggregate amount of all such dividends and all such other payments anddistributions declared or made during the period commencing January 1, 1982 toand including the Computation Date, plus the Net Amount of Investmentoutstanding on such date, provided however that with regard to the foregoingrestrictions of this paragraph 5.1, the Corporation may purchase, redeem orretire any shares of any class by exchange for or out of the proceeds of thesubstantially concurrent sale of other shares ranking either (1) junior to the1985 Series C Preference Shares, or (2) equally with or junior to the sharesbeing purchased, redeemed or retired and neither any such purchase, redemptionor retirement nor any such proceeds shall be included in any computationprovided for in this paragraph 5.1.

 

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For the purposes of this paragraph 5.1, all sumsshall be determined in United States currency.

As used in this paragraph 5.1, the following termsshall have the meanings set forth below:

"*Computation Date*" shall mean (i) in the case of a dividend,the date of the declaration thereof, (ii) in the case of any payment on accountof the purchase, redemption, or retirement of, or any distribution with respectto, shares, or any Investment, the date of the making thereof and (iii) in thecase of extended Short‐Term Investment, any date.

"*Consolidated Net Income*" shall meanthe Net Income of the Corporation and its subsidiaries, all consolidated inaccordance with generally accepted accounting principles. The Consolidated NetIncome of the Corporation and its Subsidiaries computed for the periodcommencing January 1, 1982 to and including a date not more than 135 days priorto any Computation Date shall conclusively be deemed to be that shown by aninterim statement of the Consolidated Net Income of the Corporation and itsSubsidiaries for such period prepared by the Corporation.

"*Investment*" shall mean all loans,advances and capital contributions in cash to any Person, and all cash paymentsin respect of the purchase from any Person of evidences of indebtedness,capital stock or other securities of such Person, but shall not include anyShort-Term Investment.

"*Short-Term Investment*" shall mean all Investments repayable ondemand or within one year from the making thereof. "Net Amount ofShort-Term Investment" outstanding on any day shall mean all Short-TermInvestments by the Corporation or any Subsidiary in the Parent Corporation orany subsidiary thereof (other than a Subsidiary), less the aggregate amount ofall cash received by the Corporation or any Subsidiary as payment of principalor premium, returns of capital, liquidation dividends or distributions,proceeds of sale or other dispositions, or otherwise, in respect of suchShort-Term Investments (except to the extent any such cash has been included inthe Consolidated Net Income of the Corporation and its Subsidiaries), duringthe period commencing January 1, 1982 to and including such day. "NetAmount of Investment" outstanding on any day shall mean all Investments bythe Corporation or any Subsidiary in the Parent Corporation or any subsidiarythereof (other than a Subsidiary), less the aggregate amount of all cashreceived by the Corporation or any Subsidiary, as payments of principal orpremium, returns of capital, liquidation dividends or distributions, proceedsof sale or other dispositions, or otherwise, in respect of such Investments(except to the extent any such cash has been included in the Consolidated NetIncome of the Corporation and its Subsidiaries), during the period commencingJanuary 1, 1982 to and including such day, provided, however, that Net Amountof Investment shall include Extended Short-Term Investment. "ExtendedShort-Term Investment" shall mean the highest Net Amount of Short-TermInvestment outstanding during any period of 30 consecutive days within the 12months preceding the date of determination, such 30‐day period to beselected by the Corporation.

"*Net Income*" of any corporation for any period shall mean thenet income (or net deficit) of such corporation for such period, determined inaccordance with generally accepted accounting principles.

"*Parent Corporation*" shall mean any corporation which owns,together with its subsidiaries, at least a majority of the outstanding VotingStock of the Corporation.

"*Person*" shall mean any individual, corporation, partnership,joint venture, association, joint‐stock company, trust, unincorporatedorganization or government or any agency or political subdivision thereof.

"*Stock*" shall include any and all shares, interests,participations or other equivalents (however designated) of corporate stock,and the term "Voting Stock", as applied to the stock of anycorporation, shall mean Stock of any class or classes (however designated)having ordinary voting power for the election of a majority of the members ofthe Board of Directors (or other governing body) of such corporation, otherthan Stock having such power only by reason of the happening of a contingency.

"*subsidiary*" shall mean anycorporation at least a majority of whose outstanding Voting Stock shall at thetime be owned by another corporation or by one or more subsidiaries of suchother corporation or by such other corporation and one or more subsidiariesthereof.

"*Subsidiary*"shall mean a subsidiary of the Corporation.

5.2  So long as any of the 1985 Series C PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the 1985 Series C Preference Shares given as hereinafterspecified:

 

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> 
(a)  pay any dividends (other than stock dividends) or make anydistributions on any shares of the Corporation ranking junior to the 1985Series C Preference Shares with respect to payment of dividends or return ofcapital, or

(b)  retire for value any shares of the Corporation ranking junior tothe 1985 Series C Preference Shares with respect to payment of dividends orreturn of capital, or

(c)  except in connection with the exercise ofthe retraction privilege attaching thereto, retire less than all the 1985Series C Preference Shares,

unless all dividends then payableon the 1985 Series C Preference Shares shall have been declared and paid or setapart for payment.

**6. VotingRights**

6.1  The holders of the 1985 Series C PreferenceShares shall not be entitled as such (except as hereinafter specificallyprovided) to receive notice of or to attend any meeting of the shareholders ofthe Corporation or to vote at any such meeting unless and until the Corporationfrom time to time shall fail to pay in the aggregate six quarterly dividends onthe 1985 Series C Preference Shares on the dividend payment dates whether ornot consecutive and whether or not such dividends have been declared andwhether or not there are any moneys of the Corporation properly applicable tothe payment of dividends. Thereafter, but only so long as any dividends on the 1985Series C Preference Shares remain in arrears, the holders of the 1985 Series CPreference Shares shall be entitled to receive notice of and to attend, but notto vote at, all meetings of shareholders of the Corporation and shall beentitled on any election of Directors, together with holders of shares of allother series of Preference Shares having the right to vote in similarcircumstances, voting separately and exclusively as a class, to elect twomembers of the Board of Directors of the Corporation. Each holder of PreferenceShares entitled to so vote shall be entitled to one vote in respect of eachdollar of issue price of Preference Shares held by him whether such issue priceis in Canadian or United States currency. Nothing herein contained shall bedeemed to limit the right of the Corporation from time to time to increase ordecrease the number of its Directors.

6.2  Notwithstanding anything contained in the by‐lawsof the Corporation, the term of office of all persons who may be Directors ofthe Corporation at any time when the right to elect Directors shall accrue tothe holders of 1985 Series C Preference Shares as herein provided, or who maybe appointed as Directors thereafter and before a meeting of shareholders shallhave been held, shall terminate upon the election of Directors at the nextannual meeting of shareholders or at an earlier general meeting of shareholderswhich may be held for the purpose of electing Directors and which shall becalled by the Secretary of the Corporation upon the written request of theholders of record of at least one‐tenth of the outstanding 1985 Series CPreference Shares. In default of the calling of such general meeting by theSecretary within 15 days after the making of such request, such meeting may becalled by any holder of record of 1985 Series C Preference Shares.

6.3  Any vacancy occurring among members of theBoard elected by the holders of Preference Shares may be filled by the Board ofDirectors with the consent and approval of the remaining Director elected bythe holders of Preference Shares. Whether or not such vacancy is so filled bythe Board, the holders of record of at least one‐tenth of the outstanding1985 Series C Preference Shares shall have the right to require the Secretaryof the Corporation to call a meeting of the holders of Preference Shares forthe purpose of filling the vacancy or replacing any person elected or appointedby the Board of Directors to fill such vacancy and the provisions of paragraph6.2 shall apply with respect to the calling of any such meeting.

6.4  Notwithstanding anything contained in the by‐lawsof the Corporation upon any termination of the said right to elect Directors,the term of office of the Directors elected or appointed to represent theholders of Preference Shares exclusively shall forthwith terminate.

**7. Rights onLiquidation**

In the event of the liquidation, dissolution orwinding‐up of the Corporation or other distribution of assets of theCorporation among shareholders for the purpose of winding‐up its affairs,the holders of the 1985 Series C Preference Shares shall be entitled to receive(i) the sum of $25.00 in Canadian currency per share together with all accruedand unpaid dividends up to and including the date of distribution, and (ii) ifsuch liquidation, dissolution, winding‐up or distribution shall bevoluntary, an additional amount equal to the premium, if any, which would havebeen payable on the redemption of the 1985 Series C Preference Shares if theyhad been called for redemption by the Corporation (a) on the date ofdistribution, or (b) if not then callable for redemption, on the date of theirfirst becoming redeemable, before any amount shall be paid to, or any propertyor assets of the Corporation distributed among, the holders of any shares ofthe Corporation ranking junior to the 1985 Series C Preference Shares. Afterpayment to the holders of the 1985 Series C Preference Shares of the amounts sopayable to them, they shall not be entitled to share in any furtherdistribution of the property or assets of the Corporation.

 

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**8. Amendments**

The rights, privileges, restrictions and conditionsattaching to the 1985 Series C Preference Shares may be repealed or amended inwhole or in part but only with the approval of the holders of the 1985 Series CPreference Shares, given as hereinafter specified; provided, however, that theDirectors of the Corporation may at any time or from time to time, without suchshareholder approval, but subject to the provisions of any applicable law,attach the right, exercisable at the option of the holder, to convert on suchterms and conditions and in such manner as the Directors shall determine each1985 Series C Preference Share into a Preference Share of another series.

**9. Approvals**

9.1  The approval of the holders of the 1985 SeriesC Preference Shares as to any and all matters hereinbefore referred to may begiven in writing by all the holders of the outstanding 1985 Series C PreferenceShares or by resolution passed or by‐law sanctioned at a meeting of holdersof 1985 Series C Preference Shares duly called for the purpose and held upon atleast 21 days' notice at which the holders of at least 50% of the outstanding1985 Series C Preference Shares are present or represented by proxy and carriedby not less than two‐thirds of the votes cast on a poll at such meeting.If at any such meeting the holders of 50% of the outstanding 1985 Series CPreference Shares are not present or represented by proxy within half an hourafter the time appointed for the meeting, then the meeting shall be adjournedto such date being not less than 15 days later and to such time and place asmay be appointed by the shareholders present and at least ten days' noticeshall be given of such adjourned meeting, but it shall not be necessary in suchnotice to specify the purpose for which the meeting was originally called. Atsuch adjourned meeting, the holders of 1985 Series C Preference Shares presentor represented by proxy may transact the business for which the meeting wasoriginally convened, and a resolution passed thereat by not less than two‐thirdsof the votes cast on a poll at such adjourned meeting shall constitute theapproval of the holders of the 1985 Series C Preference Shares referred toabove.

9.2  Irregularities in the notice or in the givingthereof as well as the accidental omission to give notice of any meeting to, orthe non‐receipt of any notice by, any holder of 1985 Series C PreferenceShares, shall not invalidate any action taken at any meeting.

9.3  The formalities to be observed with respect tothe giving of notice of any meeting of holders of 1985 Series C PreferenceShares and the conduct thereof shall be those from time to time prescribed inthe by‐laws of the Corporation with respect to meetings of shareholders.

**10. Notices**

Any notice required to be given under the provisionsattaching to the 1985 Series C Preference Shares to the holders thereof shallbe given by posting the same in a postage‐paid envelope addressed to eachholder at the last address of such holder as it appears on the books of theCorporation or, in the event of the address of any such holder not soappearing, then to the address of such holder last known to the Corporation;provided that accidental failure or omission to give any notice as aforesaid toone or more of such holders shall not invalidate any action or proceedingfounded thereon. In the event of a threatened or actual disruption in the mailservice, notice as aforesaid shall be given to registered holders of 1985Series C Preference Shares by means of publication twice in successive weeks ina daily newspaper of general circulation in each of the cities of Halifax,Montreal, Toronto, Winnipeg, Regina, Calgary and Vancouver. Publication in eachweek in each newspaper shall be made within a period of seven days ofpublication in each other newspaper. If at any time any notice is requiredunder the provisions of this paragraph 10 to be published in a particular cityand no newspaper of general circulation is then being published and circulatedon a daily basis in that city, the Corporation shall not be required to publishin that city. Any notice given by mail shall be deemed to be given on the dayon which it is mailed. Any notice given by publication shall be deemed to begiven on the day on which the first publication is completed in all of thecities in which publication is required.

 

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**PART A.3**

**Provisions ofthe seventh series of Preference Shares consisting of 3,000,000 CumulativeRedeemable Preference Shares, Series E**(hereinafter referred to as "Series EPreference Shares")

The Series E Preference Shares shall, in addition tothe rights, privileges, restrictions and conditions attaching to the PreferenceShares as a class, have the following rights, privileges, restrictions and conditions:

**1. Issue Price**

TheSeries E Preference Shares will have an issue price of $25.00 each.

**2. Dividends**

The holders of the Series E Preference Shares shallbe entitled to receive and the Corporation shall pay thereon, as and whendeclared by the Board of Directors of the Corporation, cumulative preferentialcash dividends which shall be as follows:

> 
(i)  An initial dividend in respect of the periodfrom and including the date of issue of the Series E Preference Shares to butexcluding January 31, 1987 (the "Initial Dividend Period"), payableon January 31, 1987 in an amount per Series E Preference Share equal to theamount obtained when $2.16 is multiplied by the number of days in the InitialDividend Period, all divided by 365;

(ii)Fixed quarterly dividends inan amount per share equal to $0.54 ($2.16 per annum) payable on the last day ofeach of the months of January, April, July and October in each year (the"Dividend Payment Dates") the first such dividend being paid on theDividend Payment Date of April 30, 1987 and the last such dividend being paidon the Dividend Payment Date of October 31, 1991; and

(iii)       Quarterly dividends, the first of whichshall be payable on the Dividend Payment Date of January 31, 1992, each in anamount per Series E Preference Share determined by applying to the $25.00 issueprice per share one‐quarter of the Annual Dividend Rate applicable to theQuarter preceding the Dividend Payment Date for which the determination isbeing made.

The record date for the payment of dividends will bethe 15th day of January, April, July and October or any other day chosen by theBoard of Directors which is not more than 30 days preceding the DividendPayment Date.

"*Annual Dividend Rate*" applicable toa Quarter is 75% of Canadian Prime.

"*Quarter*"is a period of three consecutive calendar months commencing on the first day ofany of January, April, July or October.

"*CanadianPrime*" for a Quarter is the average of the Prime Interest Rates ineffect on each day of that Quarter.

"*PrimeInterest Rate*" is the average of the annual rates of interestannounced from time to time by The Royal Bank of Canada and The Toronto‐DominionBank as reference rates then in effect for determining interest rates onCanadian dollar commercial loans in Canada. In the event that for any reasonone of the said banks does not have a Prime Interest Rate in effect during allof a Quarter then the Prime Interest Rate for such bank for such Quarter shallbe the Prime Interest Rate of the other bank. In the event that both of thesaid banks do not have a Prime Interest Rate in effect during all of a Quarter,then the Prime Interest Rate for that Quarter shall be equal to 1.65% per annumplus the average during such Quarter of the average yields at weekly tender on91‐day Government of Canada Treasury Bills as reported by the Bank ofCanada.

In the case where a dividend is payable for a periodthat ends on a date other than a Dividend Payment Date, a dividend ("ShortDividend") shall be paid in an amount per Series E Preference Sharedetermined by applying to $25.00:

> 
(iv)  8.64%, in the case of dividends payable prior to October 31, 1991,or

(v)   the Annual Dividend Rate applicable tothe Quarter preceding such date,

multiplied by the number of days fromand including the Dividend Payment Date preceding such date to and excludingsuch date, all divided by 365.

 

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The portion of the amount payable to a holder of aSeries E Preference Share on a redemption or purchase for cancellation thereof,or on the liquidation, dissolution or winding‐up of the Corporation orother distribution of assets of the Corporation among its shareholders for thepurpose of winding‐up its affairs, equal to all accrued and unpaiddividends thereon up to and excluding the date of such redemption, purchase,liquidation, dissolution, winding‐up or other distribution of assets("Specified Date") shall consist of:

> 
(vi)  the accrued and unpaid initial dividendthereon, if any payable pursuant to (i) above and all accrued and unpaidquarterly dividends thereon, if any, payable pursuant to paragraphs (ii) and(iii) above, plus

(vii)ifthe Specified Date is other than a Dividend Payment Date, an amount equal tothe Short Dividend that would be payable thereon.

**3. Redemption**

The Series E Preference Shares shall not beredeemable prior to October 31, 1991*,*howeveron or after that date such shares shall be redeemable at the option of theCorporation on at least 30days'notice prior to the date fixed for redemption in whole at any time or in partfrom time to time on payment for each share held of an amount of $25.00 pershare together with all accrued and unpaid dividends thereon up to andexcluding the date of such redemption (which for such purpose shall becalculated as provided in paragraph 2 hereof). In case a part only of theSeries E Preference Shares is to be redeemed, the shares to be redeemed shallbe selected by lot in such manner as the Board of Directors shall by resolutiondetermine.

**4. Creation orIssue of Additional Shares**

So long as any of the Series E Preference Shares areoutstanding, the Corporation shall not, without the prior approval of theholders of the Series E Preference Shares given as hereinafter specified,create or issue any shares ranking prior to or on a parity with the Series EPreference Shares with respect to return of capital or payment of dividends,provided that the Corporation may without such approval, if all dividends thenpayable on the Series E Preference Shares shall have been declared and paid orset apart for payment:

> 
(i)   issue additional series of PreferenceShares; and

(ii)   create additionalseries of First Preferred Shares to be issued upon the exercise of a right ofconversion which may hereafter be attached to the 1975Series Preferred Shares, provided that the date of retraction atthe option of the holder attached to such additional series shall not beearlier than December 31, 1989.

**5. Restrictionson Dividends, Retirement of Shares and Certain Investments**

5.1  So long as any of the Series E PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the Series E Preference Shares given as hereinafterspecified, declare any dividends on any class of its Common Shares (other thandividends payable solely in such shares) to, or make any payment on account ofthe purchase, redemption or other retirement of any shares of any class to, ormake any distribution in respect thereof to, or make or permit any Subsidiaryto make any Investment in, or permit to exist any Extended Short‐TermInvestment in, the Parent Corporation or any subsidiary thereof (other than theCorporation or a Subsidiary) either directly or indirectly, unless any suchdividends are declared to be payable not more than 120 days after the day ofdeclaration, and unless (a) all dividends then payable on the Series EPreference Shares shall have been declared and paid or set apart for paymentand (b) after giving effect to such proposed dividend or other payment ordistribution or Investment and the application of the proceeds thereof and toany other dividends declared but not yet paid, at the Computation Date, the sumof:

> 
(i)   $350,000,000 in United States currency plus (or minus in the caseof a deficit),

(ii)   the Consolidated Net Income of the Corporationand its Subsidiaries computed for the period commencing January 1, 1982 to andincluding a date not more than 135daysprior to the Computation Date, plus

(iii)  the aggregate amountof the net cash proceeds to the Corporation from sales subsequent to December31, 1981 of shares of its capital stock,

shall be greater than the sum of the aggregateamount of all such dividends and all such other payments and distributionsdeclared or made during the period commencing January 1, 1982 to and includingthe Computation Date, plus the Net Amount of Investment outstanding on suchdate, provided however that with regard to the foregoing restrictions of thisparagraph 5.1*,*the Corporation maypurchase, redeem or retire any shares of any class by exchange for or out ofthe proceeds of the substantially concurrent sale of other shares rankingeither (1) junior to the Series E Preference Shares, or (2) equally with orjunior to the shares being purchased, redeemed or retired and neither any suchpurchase, redemption or retirement nor any such proceeds shall be included inany computation provided for in this paragraph 5.1.

 

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Forthe purposes of this paragraph 5.1 all sums shall be determined in UnitedStates currency.

Asused in this paragraph 5.1, the following terms shall have the meanings setforth below:

"*ComputationDate*" shall mean (i) in the case of a dividend, the date of thedeclaration thereof, (ii) in the case of any payment on account of thepurchase, redemption, or retirement of, or any distribution with respect to,shares, or any Investment, the date of the making thereof and (iii) in the caseof Extended Short-Term Investment, any date.

"*Consolidated Net Income*" shall mean the Net Income of theCorporation and its subsidiaries, all consolidated in accordance with generallyaccepted accounting principles. The Consolidated Net Income of the Corporationand its Subsidiaries computed for the period commencing January 1, 1982 to andincluding a date not more than 135 days prior to any Computation Date shallconclusively be deemed to be that shown by an interim statement of theConsolidated Net Income of the Corporation and its Subsidiaries for such periodprepared by the Corporation.

"*Investment*"shall mean all loans, advances and capital contributions in cash to any Person,and all cash payments in respect of the purchase from any Person of evidencesof indebtedness, capital stock or other securities of such Person, but shallnot include any Short-Term Investment.

"*Short-TermInvestment*" shall mean all Investments repayable on demand or withinone year from the making thereof. "Net Amount of Short-TermInvestment" outstanding on any day shall mean all Short-Term Investmentsby the Corporation or any Subsidiary in the Parent Corporation or any subsidiarythereof (other than a Subsidiary), less the aggregate amount of all cashreceived by the Corporation or any Subsidiary as payments of principal orpremium, returns of capital, liquidation dividends or distributions, proceedsof sale or other dispositions, or otherwise, in respect of such Short-TermInvestments (except to the extend any such cash has been included in theConsolidated Net Income of the Corporation and its Subsidiaries), during theperiod commencing January 1, 1982 to and including such day. "Net Amountof Investment" outstanding on any day shall mean all Investments by theCorporation or any Subsidiary in the Parent Corporation or any subsidiarythereof (other than a Subsidiary), less the aggregate amount of all cashreceived by the Corporation or any Subsidiary, as payments of principal orpremium, returns of capital, liquidation dividends or distributions, proceedsof sale or other dispositions, or otherwise, in respect of such Investments(except to the extent any such cash has been included in the Consolidated NetIncome of the Corporation and its Subsidiaries), during the period commencingJanuary 1, 1982 to and including such day, provided, however, that Net Amountof Investment shall include Extended Short-Term Investment. "Extended Short-TermInvestment" shall mean the highest Net Amount of Short-Term Investmentoutstanding during any period of 30 consecutive days within the 12 monthspreceding the date of determination, such 30‐day period to be selected bythe Corporation.

"*NetIncome*" of any corporation for any period shall mean the net income(or net deficit) of such corporation for such period, determined in accordancewith generally accepted accounting principles.

"*ParentCorporation*" shall mean any corporation which owns together with itssubsidiaries, at least a majority of the outstanding Voting Stock of theCorporation.

"*Person*"shall mean any individual, corporation, partnership, joint venture,association, joint‐stock company, trust, unincorporated organization orgovernment or any agency or political subdivision thereof.

"*Stock*"shall include any and all shares, interests, participations or otherequivalents (however designated) of corporate stock, and the term "VotingStock", as applied to the stock of any corporation, shall mean Stock ofany class or classes (however designated) having ordinary voting power for theelection of a majority of the members of the Board of Directors (or othergoverning body) of such corporation, other than Stock having such power only byreason of the happening of a contingency.

"*subsidiary*" shall mean any corporation at least amajority of whose outstanding Voting Stock shall at the time be owned byanother corporation or by one or more subsidiaries of such other corporation orby such other corporation and one or more subsidiaries thereof.

"*Subsidiary*" shall mean a subsidiaryof the Corporation.

5.2  So long as any of the Series E PreferenceShares are outstanding, the Corporation shall not, without the prior approvalof the holders of the Series E Preference Shares given as hereinafterspecified:

> 
(i)   pay any dividends (other than stock dividends) or make anydistributions on any shares of the Corporation ranking junior to the Series EPreference Shares with respect to payment of dividends or return of capital, or

 

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(ii)   retire for value any shares of the Corporation ranking junior tothe Series E Preference Shares with respect to payment of dividends or returnof capital, or

(iii)  retire less than all the Series EPreference Shares,

unless all dividends then payableon the Series E Preference Shares shall have been declared and paid or setapart for payment.

**6. VotingRights**

6.1  The holders of the Series E Preference Sharesshall not be entitled as such (except as hereinafter specifically provided) toreceive notice of or to attend any meeting of the shareholders of theCorporation or to vote at any such meeting unless and until the Corporationfrom time to time shall fail to pay in the aggregate six quarterly dividends onthe Series E Preference Shares on the dividend payment dates whether or notconsecutive and whether or not such dividends have been declared and whether ornot there are any moneys of the Corporation properly applicable to the paymentof dividends. Thereafter, but only so long as any dividends on the Series EPreference Shares remain in arrears, the holders of the Series E PreferenceShares shall be entitled to receive notice of and to attend, but not to voteat, all meetings of shareholders of the Corporation and shall be entitled onany election of Directors, together with holders of shares of all other seriesof Preference Shares having the right to vote in similar circumstances, votingseparately and exclusively as a class, to elect two members of the Board ofDirectors of the Corporation. Each holder of Preference Shares entitled to sovote shall be entitled to one vote in respect of each dollar of issue price ofPreference Shares held by him whether such issue price is in Canadian or UnitedStates currency. Nothing herein contained shall be deemed to limit the right ofthe Corporation from time to time to increase or decrease the number of itsDirectors.

6.2  Notwithstanding anything contained in the by‐lawsof the Corporation, the term of office of all persons who may be Directors ofthe Corporation at any time when the right to elect Directors shall accrue tothe holders of Series E Preference Shares as herein provided, or who may beappointed as Directors thereafter and before a meeting of shareholders shallhave been held, shall terminate upon the election of Directors at the nextannual meeting of shareholders or at an earlier general meeting of shareholderswhich may be held for the purpose of electing Directors and which shall becalled by the Secretary of the Corporation upon the written request of theholders of record of at least one‐tenth of the outstanding Series EPreference Shares. In default of the calling of such general meeting by theSecretary within 15 days after the making of such request, such meeting may becalled by any holder of record of Series E Preference Shares.

6.3  Any vacancy occurring among members of theBoard elected by the holders of Preference Shares may be filled by the Board ofDirectors with the consent and approval of the remaining Director elected bythe holders of Preference Shares. Whether or not such vacancy is so filled bythe Board, the holders of record of at least one‐tenth of the outstandingSeries E Preference Shares shall have the right to require the Secretary of theCorporation to call a meeting of the holders of Preference Shares for thepurpose of filling the vacancy or replacing any person elected or appointed bythe Board of Directors to fill such vacancy and the provisions of paragraph 6.2shall apply with respect to the calling of any such meeting.

6.4  Notwithstanding anything contained in the by‐lawsof the Corporation upon any termination of the said right to elect Directors,the term of office of the Directors elected or appointed to represent theholders of Preference Shares exclusively shall forthwith terminate.

**7. Rights onLiquidation**

In the event of the liquidation, dissolution orwinding‐up of the Corporation or other distribution of assets of theCorporation among shareholders for the purpose of winding‐up its affairs,the holders of the Series E Preference Shares shall be entitled to receive thesum of $25.00 per share together with all accrued and unpaid dividends thereonup to and excluding the date of distribution, (which for such purpose shall becalculated as provided in paragraph 2 hereof) before any amount shall be paidto, or any property or assets of the Corporation distributed among, the holdersof any shares of the Corporation ranking junior to the Series E PreferenceShares. After payment to the holders of the Series E Preference Shares of theamounts so payable to them, they shall not be entitled to share in any furtherdistribution of the property or assets of the Corporation.

**8. Amendments**

The rights, privileges, restrictions and conditionsattaching to the Series E Preference Shares may be repealed or amended in wholeor in part but only with the approval of the holders of the Series E PreferenceShares, given as hereinafter specified; provided, however, that the Directorsof the Corporation may at any time or from time to time, without suchshareholder approval, but subject to the provisions of any applicable law,attach the right, exercisable at the option of the holder, to convert on suchterms and conditions and in such manner as the Directors shall determine eachSeries E Preference Share into a Preference Share of another series.

 

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**9. Approvals**

9.1  The approval of the holders of the Series EPreference Shares as to any and all matters hereinbefore referred to may begiven in writing by all the holders of the outstanding Series E PreferenceShares or by resolution passed or by‐law sanctioned at a meeting ofholders of Series E Preference Shares duly called for the purpose and held uponat least 21 days' notice at which the holders of at least 50% of theoutstanding Series E Preference Shares are present or represented by proxy andcarried by not less than two‐thirds of the votes cast on a poll at suchmeeting. If at any such meeting the holders of 50% of the outstanding Series EPreference Shares are not present or represented by proxy within half an hourafter the time appointed for the meeting, then the meeting shall be adjournedto such date being not less than 15 days later and to such time and place asmay be appointed by the shareholders present and at least ten days' noticeshall be given of such adjourned meeting, but it shall not be necessary in suchnotice to specify the purpose for which the meeting was originally called. Atsuch adjourned meeting the holders of Series E Preference Shares present orrepresented by proxy may transact the business for which the meeting wasoriginally convened, and a resolution passed thereat by not less than two‐thirdsof the votes cast on a poll at such adjourned meeting shall constitute theapproval of the holders of the Series E Preference Shares referred to above.

9.2  Irregularities in the notice or in the givingthereof as well as the accidental omission to give notice of any meeting to, or the non‐receipt of any notice by, any holder ofSeries E Preference Shares, shall not invalidate any action taken at anymeeting.

9.3  The formalities to be observed with respect tothe giving of notice of any meeting of holders of Series E Preference Sharesand the conduct thereof shall be those from time to time prescribed in the by‐lawsof the Corporation with respect to meetings of shareholders.

**10. Notices**

Any notice required to be given under the provisionsattaching to the Series E Preference Shares to the holders thereof shall begiven by posting the same in a postage‐paid envelope addressed to eachholder at the last address of such holder as it appears on the books of theCorporation or, in the event of the address of any such holder not soappearing, then to the address of such holder last known to the Corporation;provided that accidental failure or omission to give any notice as aforesaid toone or more of such holders shall not invalidate any action or proceedingfounded thereon. In the event of a threatened or actual disruption in the mailservice, notice as aforesaid shall be given to registered holders of Series EPreference Shares by means of publication twice in successive weeks in a dailynewspaper of general circulation in each of the cities of Halifax, Montreal,Toronto, Winnipeg, Regina, Calgary and Vancouver. Publication in each week ineach newspaper shall be made within a period of seven days of publication ineach other newspaper. If at any time any notice is required under theprovisions of this paragraph 10 to be published in a particular city and nonewspaper of general circulation is then being published and circulated on adaily basis in that city, the Corporation shall not be required to publish inthat city. Any notice given by mail shall be deemed to be given on the day onwhich it is mailed. Any notice given by publication shall be deemed to be givenon the day on which the first publication is completed in all of the cities inwhich publication is required.

 

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**PART B**

**An unlimited number of CommonShares without nominal or par value**

TheCommon Shares shall be subject to the prior rights, privileges, restrictionsand conditions attached to the Preferred Shares and the Preference Shares andthe holders of the Common Shares shall, amongst other things, be entitled: 

> 
(a)    to vote at all meetings of Shareholders of the Corporation exceptmeetings at which only holders of other classes of shares are entitled to vote;and

(b)    to receive the remaining property of the Corporationupon dissolution.

 

 

 

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