Document:

ex10-2.htm

 

Exhibit 10.2

 

CONVERTIBLE LOAN AGREEMENT

 

THIS CONVERTIBLE LOAN AGREEMENT made as of the 1st of June, 2015 (the "Effective Date").

 

BETWEEN:

 

DEL TORO SILVER CORP., with an address at 320 North Carson Street, Carson City, Nevada 89701

 

(hereinafter referred to as the "Company")

 

AND:

 

Patrick Fagen, with an address at 2229 Tahoe Vista Drive, South lake Tahoe, CA 96150 (hereinafter referred to as the "Lender")

 

WHEREAS:

 

A.     The Company has borrowed from the Lender, and the Lender has provided to the Company, certain funds (defined herein as the "Loan"), which the parties have agreed to make subject to the terms and conditions set forth herein;

 

B.     The Loan is convertible (the "Conversion") into securities of the Company consisting of common shares of the Company with a par value of $0.001 (the "Shares") upon the terms and conditions set forth herein; and

 

C.     The Lender understands and acknowledges to the Company that this Agreement is being made pursuant to an exemption (the "Exemption") from registration provided by Section 4(2) of the United States Securities Act of 1933, as amended (the "Securities Act") and Rule 506 of Regulation D of the Securities Act for the private offering of securities.

 

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual covenants and agreements herein contained, the receipt of which is hereby acknowledged by each of the parties hereto, the parties hereto covenant and agree each with the other (the "Agreement") as follows:

 

	
1.
	
Representations and Warranties of the Lender

	 	 
	(a) 	The Lender represents and warrants to, and covenants and agrees with the Company that:

 

	 	
(i)
	
the Lender makes the Loan to the Company and acquires the Conversion Right (as defined herein) in reliance upon the Exemption from registration provided by Section 4(2) of the Securities Act and Rule 506 of Regulation D of the Securities Act for the private offering of securities;

 

	 	
(ii)
	
the Lender is eligible to make the Loan to the Company and acquire the Conversion Right in the Company under Regulation D, and all statements set forth in the Declaration of Regulation D Eligibility, attached hereto as Schedule A, are true and correct and may be relied upon by the Company; further, all information, representations and warranties contained in this Agreement, or that have been otherwise given to the Company, are correct and complete as of the date hereof, and may be relied upon by the Company;

 

	 	
(iii)
	
the Lender is aware of the significant economic and other risks involved in making the Loan to the Company and in acquiring and/or exercising the Conversion Right;

 

 

 

 

 - 2 -

 

	 	
(iv)
	
the Lender has consulted with its own legal advisor as to this Agreement and its eligibility to acquire and/or exercise the Conversion Right under the laws of its home jurisdiction and acknowledges that the Company has made no effort and takes no responsibility for the consequences to the Lender as an investor acquiring this Conversion right and, in particular, in purchasing the securities upon exercise, if any, of the Conversion Right;

 

	 	
(v)
	
no federal or state agency has passed upon, or make any finding or determination as to the fairness of this investment, and that there have been no federal or state agency recommendations or endorsements of the investment made hereunder;

 

	 	
(vi)
	
the Lender acknowledges that:

 

	 	
A.
	
there are substantial restrictions on the sale or transferability of any Shares acquired upon exercise of the Conversion Right and understands that, although the Company is a reporting company, the Lender is, upon exercising the Conversion Rights, purchasing unregistered securities;

 

	 	
B.
	
the Lender may not be able to liquidate this investment in the event of any financial emergency and will be required to bear the economic risk of this investment for a lengthy or even indefinite period of time;

 

	 	
C.
	
the Company is not contractually obligated to register under the Securities Act any Shares acquired upon an exercise of the Conversion Right; and

 

	 	
D.
	
any Shares acquired by the Lender upon exercise of the Conversion Right may never be sold or otherwise transferred without registration under the Securities Act, unless an exemption from registration is available.

 

	 	
(vii)
	
the Lender, alone or with its advisor, has enough knowledge and experience in financial and business matters to make it capable of evaluating the merits and risks of investing in the Company;

 

	 	
(viii)
	
the Lender makes the Loan to the Company and acquires the Conversion Right as principal for its own account and not for the benefit of any other person;

 

	 	
(ix)
	
the Lender understands that any Certificates representing Shares acquired by the Lender upon exercise of the Conversion Right will have a resale legend on them that will read substantially as follows:

 

The Securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”) and are being offered and sold within the United States only to Accredited Investors (as defined in Rule 501(a) of Regulation D under the U.S. Securities Act). Prospective subscribers of the Securities in the United States are hereby notified that the seller of the Securities is relying upon the exemption from the provisions of Section 5 of the U.S. Securities Act provided in Section 4(2) of the U.S. Securities Act and Rule 506 of Regulation D under the U.S. Securities Act for non-public offerings. The Securities offered hereby are not transferable except in accordance with the restrictions described herein. 

 

	 	
(x)
	
the Lender has good and sufficient right and authority to enter into this Agreement and to carry out the transactions contemplated by this Agreement on the terms and conditions contained herein.

 

 

 

 

 - 3 -

 

	(b)	The representations, warranties, covenants and agreements of and by the Lender contained in, or delivered pursuant to, this Agreement shall be true at and as of the Effective Date and shall remain in full force and effect throughout the term of this Agreement.
	 	 
	
2.
	
The Loan

	 	 
	(a)	Subject to the terms of this Agreement, the Lender hereby agrees to loan to the Company, and the Company hereby agrees to borrow from the Lender, the principal sum of US$12,300 (the "Loan") which has been provided on June 1, 2015 (the "Advancement Date).
	 	 
	(b)	The principal amount of the Loan, and any accrued and unpaid interest calculated in accordance with section 2(c), shall be due and payable in full by 5:00 p.m. local time in Las Vegas, Nevada, one (1) year from any applicable Advancement Date (the “Due Date”). If such day falls on a Sunday or statutory holiday, then by 5:00 p.m. local time in Las Vegas, Nevada, on the first business day thereafter the Due Date.
	 	 
	(c)  	The Loan shall bear interest at a rate of 8% per annum (the "Interest") calculated in arrears on the principal amount of the Loan outstanding. Interest shall be payable annually, on the subsequent anniversaries of the Advancement Date.
	 	 
	(d) 	The Company shall be entitled to prepay any sum up to the full amount of the Loan and accrued interest then outstanding at any time without penalty or bonus.
	 	 
	(e)	At any time after the Advancement Date, the Lender may by written notice (the "Notice") to the Company along with the Declaration attached hereto as Schedule A, exercise its rights of Conversion in respect of either a portion of or the total outstanding amount of the Loan plus accrued Interest as of that date into Shares of the Company, at the price of US$.014 per Share (the “Conversion Right”).
	 	 
	(f)  	Within seven (7) days of Notice by the Lender exercising its Conversion Rights hereunder, the Company shall cause to be delivered a Share Certificate to the Lender representing the number of Shares acquired by the Lender pursuant to the calculation set out in subparagraph 2(e) of this Agreement.
	 	 
	(g)  	Notwithstanding any of the foregoing, Interest shall be calculated and included in any Conversion of the Loan

 

	
3.
	
Covenants and Agreements of the Lender

	 	 
	(a)	The Lender covenants and agrees with the Company that the Lender shall not make demand for payment of the Loan prior to the Due Date unless the Loan has become due and payable in accordance with the provisions of this Agreement.

 

	
4.
	
Default

	 	 
	(a)	If one or more of the following events shall occur, namely:

 

	 	
(i)
	
the Company fails to repay the Loan or the Interest thereon on the Due Date;

 

	 	
(ii)
	
the Company makes an assignment for the benefit of its creditors or files a petition in bankruptcy or is adjudicated insolvent or bankrupt or petitions or applies to any tribunal for any receiver, receiver manager, trustee, liquidator or sequestrator of or for the Company or any of the Company's assets or undertaking, or the Company makes a proposal or compromise with its creditors or if an application or a petition similar to any of the foregoing is made by a third party creditor and such application or petition remains unstayed or undismissed for a period of thirty (30) days;

 

 

 

 

 - 4 -

 

	 	
(iii)
	
an order of execution against any of the Company's assets remains unsatisfied for a period of ten (10) days;

 

	 	
(iv)
	
the Company fails to observe and comply with any material term, condition or provision of this Agreement or any other agreement or document delivered hereunder, and such failure continues unremedied for a period of thirty (30) days;

 

	 	
(v)
	
any representations, warranties, covenants or agreements contained in this Agreement or any document delivered to the Lender hereunder are found to be untrue or incorrect as at the date thereof; or

 

	 	
(vi)
	
the holder (including the Lender) of any mortgage, charge or encumbrance on any of the Company's assets and undertaking does anything to enforce or realize on such mortgage, charge or encumbrance;

 

then the Loan and all accrued Interest to the date of such default shall, at the option of the Lender, immediately become due and payable without presentment, protest or notice of any kind, all of which are waived by the Company. 

 

	
5.
	
Independent Legal Advice

 

(a)     The Lender acknowledges that:

 

	 	
(i)
	
Macdonald Tuskey, Corporate and Securities Lawyers received instructions from the Company and does not represent the Lender;

 

	 	
(ii)
	
the Lender has been requested to obtain its own independent legal advice on this Agreement prior to signing this Agreement;

 

	 	
(iii)
	
the Lender has been given adequate time to obtain independent legal advice;

 

	 	
(iv)
	
by signing this Agreement, the Lender confirms that it fully understands this Agreement; and

 

	 	
(v)
	
by signing this Agreement without first obtaining independent legal advice, the Lender waives its right to obtain independent legal advice.

 

	
6.
	
General

	 	 
	(a)  	For the purposes of this Agreement, time is of the essence.
	 	 
	(b)   	The parties hereto shall execute and deliver all such further documents and instruments and do all such acts and things as may either before or after the execution of this Agreement be reasonably required to carry out the full intent and meaning of this Agreement.
	 	 
	(c)    	This Agreement shall be construed in accordance with the laws of the State of Nevada.
	 	 
	(d)  	This Agreement may be assigned by the Lender subject to any assignee making requisite representations to meet applicable securities law exemptions; this Agreement may not be assigned by the Company.
	 	 
	(e)  	This Agreement may be signed by the parties in as many counterparts as may be deemed necessary, each of which so signed shall be deemed to be an original, and all such counterparts together shall constitute one and the same instrument.

 

 

 

 

- 5 -

 

	(f)	All notices, requests, demands or other communications hereunder shall be in writing and shall be "deemed delivered" to a party on the date it is hand delivered to such party's address first above written, or to such other address as may be given in writing by the parties hereto.

 

IN WITNESS WHEREOF the parties have hereunto set their hands effective as of the date first above written.

 

DEL TORO SILVER CORP.

 

Per:     /s/ Greg Painter                                               
            Greg Painter, President and CEO of Del Toro Silver Corp.

 

 

 

 

 

 

/s/ Patrick Fagen                                                         

 

                   Patrick Fagen, Lender

 

 

 

 

 

Schedule A

 

UNITED STATES
ACCREDITED INVESTOR QUESTIONNAIRE

 

All capitalized terms herein, unless otherwise defined, have the meanings ascribed thereto in the Subscription Agreement.

 

This Questionnaire is for use by the Lender who as a US person (as that term is defined Regulation S of the United States Securities Act of 1933 (the “1933 Act”)) and has indicated an interest in purchasing Shares of the Company. The purpose of this Questionnaire is to assure the Company that the Lender will meet the standards imposed by the 1933 Act and the appropriate exemptions of applicable state securities laws. The Company will rely on the information contained in this Questionnaire for the purposes of such determination. The Securities will not be registered under the 1933 Act in reliance upon the exemption from registration afforded by Section 3(b) and/or Section 4(2) and Regulation D of the 1933 Act. This Questionnaire is not an offer of the Securities or any other securities of the Company in any state other than those specifically authorized by the Company.

 

All information contained in this Questionnaire will be treated as confidential. However, by signing and returning this Questionnaire, the Lender agrees that, if necessary, this Questionnaire may be presented to such parties as the Company deems appropriate to establish the availability, under the 1933 Act or applicable state securities law, of exemption from registration in connection with the sale of the Securities hereunder.

 

The Lender covenants, represents and warrants to the Company that it satisfies one or more of the categories of “Accredited Investors”, as defined by Regulation D promulgated under the 1933 Act, as indicated below: (Please initial in the space provide those categories, if any, of an “Accredited Investor” which the Lender satisfies.)

 

 

	
                         
	 	
Category 1 
	
An organization described in Section 501(c)(3) of the United States Internal Revenue Code, a corporation, a Massachusetts or similar business trust or partnership, not formed for the specific purpose of acquiring the Securities, with total assets in excess of US $5,000,000.

	
 
	 	
 
	
 

	
                         
	 	
Category 2    
	
A natural person whose individual net worth, or joint net worth with that person’s spouse, on the date of purchase exceeds US $1,000,000, excluding the value of such person’s primary residence.

	
 
	 	
 
	
 

	
                         
	 	
Category 3 
	
A natural person who had an individual income in excess of US $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of US $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year.

	
 
	 	
 
	
 

	
                         
	 	
Category 4   
	
A “bank” as defined under Section (3)(a)(2) of the 1933 Act or savings and loan association or other institution as defined in Section 3(a)(5)(A) of the 1933 Act acting in its individual or fiduciary capacity; a broker dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934 (United States); an insurance company as defined in Section 2(13) of the 1933 Act; an investment company registered under the Investment Company Act of 1940 (United States) or a business development company as defined in Section 2(a)(48) of such Act; a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958 (United States); a plan with total assets in excess of $5,000,000 established and maintained by a state, a political subdivision thereof, or an agency or instrumentality of a state or a political subdivision thereof, for the benefit of its employees; an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 (United States) whose investment decisions are made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000, or, if a self-directed plan, whose investment decisions are made solely by persons that are accredited investors.

 

 

 

 

 - 2 -

 

	
                         
	 	
Category 5  
	
A private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940 (United States).

	
 
	 	
 
	
 

	
                         
	 	
Category 6  
	
A director or executive officer of the Company.

	
 
	 	
 
	
 

	
                         
	 	
Category 7 
	
A trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities, whose purchase is directed by a sophisticated person as described in Rule 506(b)(2)(ii) under the 1933 Act.

	 	 	 	 
	                         	 	Category 8	An entity in which all of the equity owners satisfy the requirements of one or more of the foregoing categories.

      

Note that the Lender claiming to satisfy one of the above categories of Accredited Investor may be required to supply the Company with a balance sheet, prior years’ federal income tax returns or other appropriate documentation to verify and substantiate the Lender’s status as an Accredited Investor.

 

If the Lender is an entity which initialled Category 8 in reliance upon the Accredited Investor categories above, state the name, address, total personal income from all sources for the previous calendar year, and the net worth (exclusive of home, home furnishings and personal automobiles) for each equity owner of the said entity: 

 

 

 

The Lender hereby certifies that the information contained in this Questionnaire is complete and accurate and the Lender will notify the Company promptly of any change in any such information. If this Questionnaire is being completed on behalf of a corporation, partnership, trust or estate, the person executing on behalf of the Purchaser represents that it has the authority to execute and deliver this Questionnaire on behalf of such entity.

 

IN WITNESS WHEREOF, the undersigned has executed this Questionnaire as of the 1st day of June, 2015.

 

	
If a Corporation, Partnership or Other Entity:
	 	
If an Individual:
	 
	 	 	 	 
	 	 	 	 
	
Print of Type Name of Entity
	 	Signature	 
	 	 	 	 
	 	 	Patrick Fagen	 
	Signature of Authorized Signatory	 	Print or Type Name	 
	 	 	 	 
	 	 	 	 
	
Type of EntityForm of Note for the Company's 4.090% Subordinated Notes due June 9, 2025

 Exhibit 4.01 

This Subordinated Note is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of the
Depository named below or a nominee of the Depository. This Subordinated Note is not exchangeable for Subordinated Notes registered in the name of a Person other than the Depository or its nominee except in the limited circumstances described herein
and in the Indenture, and no transfer of this Subordinated Note (other than a transfer of this Subordinated Note as a whole by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of
the Depository) may be registered except in the limited circumstances described herein. 
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF CDS CLEARING AND DEPOSITORY SERVICES INC. (“CDS”) TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IN RESPECT THEREOF IS REGISTERED IN THE NAME OF
CDS & CO., OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS (AND ANY PAYMENT IS MADE TO CDS & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED HOLDER HEREOF, CDS & CO., HAS A PROPERTY INTEREST IN THE SECURITIES REPRESENTED BY THIS CERTIFICATE HEREIN AND IT IS A VIOLATION OF ITS RIGHTS FOR
ANOTHER PERSON TO HOLD, TRANSFER OR DEAL WITH THIS CERTIFICATE. THIS CERTIFICATE IS ISSUED PURSUANT TO A BOOK ENTRY ONLY SECURITIES SERVICES AGREEMENT BETWEEN ISSUER AND CDS, AS SUCH AGREEMENT MAY BE REPLACED OR AMENDED FROM TIME TO TIME. 

CITIGROUP INC. 
 4.090%
Subordinated Notes due June 9, 2025 
  

			
	REGISTERED		REGISTERED
		
			CUSIP: 172967 JS1  
			ISIN: CA 172967JS17  
			Common Code: 124412633  
		
	No. R-0001		C$600,000,000  

 CITIGROUP INC., a Delaware corporation (the “Company”, which term includes any successor Person
under the Indenture), for value received, hereby promises to pay to CDS & Co., or registered assigns, the principal sum of up to C$600,000,000 (or such other principal sum as has been most lately endorsed on the Schedule of Exchanges of
Interests hereto) on June 9, 2025 and to pay interest thereon from and including June 9, 2015 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually, on June 9 and
December 9 of each year, commencing December 9, 2015 at the rate of 4.090% per annum, on each Interest Payment Date until the principal hereof is paid or made available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, 

 
as provided in the Indenture, be paid to the Person in whose name this Subordinated Note is registered at the close of business on the Record Date for such interest, which shall be the Business
Day immediately preceding such Interest Payment Date. The Subordinated Note may be redeemed in whole, but not in part, at any time if changes involving United States taxation occur which could require Citigroup to pay additional amounts. 

Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the holder on such Record Date and may
either be paid to the Person in whose name this Subordinated Note is registered at the close of business on a subsequent Record Date, such subsequent Record Date to be not less than five days prior to the date of payment of such defaulted interest,
notice whereof shall be given to holders of Subordinated Notes of this series not less than fifteen days prior to such subsequent Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Subordinated Notes of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture. 

Interest hereon will be calculated on the basis of a 360-day year comprised of twelve 30-day months, except interest for any period other than
a full semi-annual period will be calculated on the basis of the actual number of days elapsed and a year of 365 days. 
 If either an
Interest Payment Date or the maturity of the Subordinated Notes falls on a day that is not a Business Day, such Interest Payment Date or maturity will be the next succeeding Business Day. If a date for payment of interest or principal on the
Subordinated Notes falls on a day that is not a Business Day in the place of payment, such payment will be made on the next succeeding Business Day in such place of payment as if made on the date the payment was due. No interest will accrue on any
amounts payable for the period from and after the due date for payment of such principal or interest. For these purposes, “Business Day” means any day which is a day on which commercial banks settle payments and are open for general
business (including dealings in foreign currency deposits and foreign exchange) in The City of New York and Toronto. 
 Payment of the
principal of and interest on this Subordinated Note will be made through the office or agency of the Trustee maintained for that purpose in London in Canadian dollars. 

Unless permitted under Canadian securities legislation, the holder of this Subordinated Note must not trade the Subordinated Note before
October 10, 2015. 
 Reference is hereby made to the further provisions of this Subordinated Note set forth on the reverse hereof,
which further provisions shall for all purposes have the same effect as if set forth at this place. 
 Unless the certificate of
authentication hereon has been executed by the Trustee or by an authenticating agent on behalf of the Trustee by manual signature, this Subordinated Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any
purpose. 

  
 2 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal. 
 Dated: June 9, 2015 
  

			
	CITIGROUP INC.
		
	By:		  

	Title:		Deputy Treasurer

  

			
	ATTEST:
		
	By:		  

	Title:		Assistant Secretary

  
 3 

 This is one of the Subordinated Notes of the series issued under the within-mentioned Indenture.

 Dated: June 9, 2015 
  

			
	THE BANK OF NEW YORK MELLON,
	as Trustee
		
	By:		  

			Name:
			Title:
	
	-or-
	
	 CITI TRUST COMPANY CANADA,
 as
Authenticating Agent

		
	By:		  

			Name:
			Title:

  
 4 

 This Subordinated Note is one of a duly authorized issue of Securities of the Company (the
“Subordinated Notes”), issued and to be issued in one or more series under the Indenture, dated as of April 12, 2001 (as amended and supplemented to date, the “Indenture”), between the Company and The Bank of New York Mellon
(successor to J.P. Morgan Trust Company, N.A. and Bank One Trust Company N.A.), as Trustee (the “Trustee”, which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the holders of the Subordinated Notes and of the terms upon which the Subordinated Notes are, and are to
be, authenticated and delivered. This Subordinated Note is one of the series designated on the face hereof, initially limited in aggregate principal to C$600,000,000. 

The Company covenants and agrees that the indebtedness evidenced by the Subordinated Notes is subordinate and junior in right of payment to
all Senior Indebtedness (as defined in the Indenture) to the extent provided in the Indenture, and each holder of Subordinated Notes, by his or her acceptance thereof, likewise covenants and agrees to the subordination provided in the Indenture
(including Article Fourteen thereof) and shall be bound by the provisions thereof. 
 In the event that the Company shall default in the
payment of any principal of (or premium, if any) or interest on any Senior Indebtedness when the same becomes due and payable after any applicable grace period, whether at maturity or at a date fixed for prepayment or by declaration or otherwise,
then, unless and until such default shall have been cured or waived or shall have ceased to exist, no direct or indirect payment (in cash, property, securities, by set-off or otherwise) shall be made or agreed to be made on account of the principal
of, or premium, if any, or interest on the indebtedness evidenced by the Subordinated Notes, or in respect of any redemption, retirement or other acquisition of any of the Subordinated Notes, except that holders of Subordinated Notes may receive and
retain (x) securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Subordinated Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan of reorganization or readjustment and (y) payments made from
a defeasance trust created pursuant to Article Eleven of the Indenture. 
 In the event of: 

(i) any insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment, composition or other similar proceeding relating to
the Company, its creditors or its property, 
 (ii) any proceeding for liquidation, dissolution or other winding up of the Company, voluntary
or involuntary, whether or not involving insolvency or bankruptcy proceedings, 
 (iii) any assignment by the Company for the benefit of
creditors, or 
 (iv) any other marshalling of the assets of the Company, 

  
 R-1 

 all Senior Indebtedness (including any interest thereon accruing after the commencement of any such proceedings)
shall first be paid in full before any payment or distribution, whether in cash, securities or other property, shall be made to any Holder of any of the Subordinated Notes on account thereof (except as provided in the next sentence). Any payment or
distribution, whether in cash, securities or other property (other than (x) securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent
provided in these subordination provisions with respect to the indebtedness evidenced by the Subordinated Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan of
reorganization or readjustment and (y) payments made from a defeasance trust created pursuant to Article Eleven of the Indenture), which would otherwise (but for these subordination provisions) be payable or deliverable in respect of the
Subordinated Notes shall be paid or delivered directly to the holders of Senior Indebtedness in accordance with the priorities then existing among such holders until all Senior Indebtedness (including any interest thereon accruing after the
commencement of any such proceedings) shall have been paid in full. 
 If an event of default (as defined in the Indenture) with respect to
Subordinated Notes of this series shall occur and be continuing, the principal of the Subordinated Notes of this series may be declared due and payable in the manner and with the effect provided in the Indenture. 

The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Subordinated Note upon compliance by the
Company with certain conditions set forth in Article Eleven thereof, which provisions apply to this Subordinated Note. 
 The Indenture
contains provisions permitting the Company and the Trustee, without the consent of the holders of Securities, to establish, among other things, the form and terms of any series of Securities issuable thereunder by one or more supplemental
indentures, and, with the consent of the holders of not less than a majority of the principal amount of Securities at the time Outstanding which are affected thereby, to modify the Indenture or any supplemental indenture or the rights of the holders
of Securities of such series to be affected, provided that no such modification shall, without the consent of the holder of each Outstanding Security so affected, (x) change the Stated Maturity of the principal of, or any installment of
principal of or interest on, any Security, or reduce the principal amount thereof or the rate of interest thereon or any premium thereon, or change any place of payment where, or the coin or currency in which any Security or any premium or interest
thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption on or after the Redemption Date) or modify the provisions of the Indenture with
respect to the subordination of the Securities in a manner adverse to the Securityholders or (y) reduce the aforesaid percentage in principal amount of the Outstanding Securities of any series, the consent of the holders of which is required
for any supplemental indenture, or the consent of whose holders is required for any waiver provided for in the Indenture, or (z) modify certain other provisions of the Indenture, as set forth in Section 13.02 of the Indenture. 

  
 R-2 

 No reference herein to the Indenture and no provision of this Subordinated Note or of the
Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Subordinated Note at the times, place and rate, and in the coin or currency, herein prescribed. 

This Subordinated Note is a Global Security registered in the name of a nominee of the Depository. This Subordinated Note is exchangeable for
Subordinated Notes registered in the name of a person other than the Depository or its nominee only in the limited circumstances hereinafter described. Unless and until it is exchanged in whole or in part for definitive Subordinated Notes in
certificated form, this Subordinated Note may not be transferred except as a whole by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository. 

The Subordinated Notes represented by this Global Security are exchangeable for definitive Subordinated Notes in certificated form of like
tenor as such Subordinated Notes in denominations of C$100,000 and integral multiples of C$1,000 in excess thereof only if (i) the Depository notifies the Company that it is unwilling or unable to continue as Depository for the Subordinated
Notes or (ii) the Depository ceases to be a recognized clearing agency under the Securities Act (Ontario) or other applicable Canadian securities legislation and a successor depositary is not appointed by the Company within a reasonable
period after becoming aware that the Depositary is no longer so recognized or (iii) if both Clearstream Banking, société anonyme and Euroclear Bank, S.A./N.V., or its successor, as operator of the Euroclear System, notify the
Company that they are unwilling or unable to continue as a clearing system in connection with the Subordinated Note or (iv) the Company in its sole discretion decides to allow the Subordinated Notes to be exchanged for definitive Subordinated
Notes in registered form. Any Subordinated Notes that are exchangeable pursuant to the preceding sentence are exchangeable for certificated Subordinated Notes issuable in authorized denominations and registered in such names as the Depository shall
direct. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of definitive Subordinated Notes in certificated form is registrable at the office of Citibank Canada in Toronto, Canada or Citibank N.A. in
London, England for such purpose, upon surrender of the definitive Subordinated Note for registration of transfer at the office or agency of the registrar, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to
the Company and the registrar duly executed by, the holder thereof or his attorney duly authorized in writing, and thereupon one or more new Subordinated Notes of this series and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees. Subject to the foregoing, this Subordinated Note is not exchangeable, except for a Global Security or Global Securities of this issue of the same principal amount to be
registered in the name of the Depository or its nominee. 
 No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 

Prior to due presentment of this Subordinated Note for registration of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in 

  
 R-3 

 
whose name this Subordinated Note is registered as the owner hereof for all purposes, whether or not this Subordinated Note be overdue, and neither the Company, the Trustee nor any such agent
shall be affected by notice to the contrary. 
 The Company will pay additional amounts (“Additional Amounts”) to the beneficial
owner of any Subordinated Note that is a non-United States person in order to ensure that every net payment on such Subordinated Note will not be less, due to payment of U.S. withholding tax, than the amount
then due and payable. For this purpose, a “net payment” on a Subordinated Note means a payment by the Company or a paying agent, including payment of principal and interest, after deduction for any present or future tax, assessment or
other governmental charge of the United States. These Additional Amounts will constitute additional interest on the Subordinated Note. 

The Company will not be required to pay Additional Amounts, however, in any of the circumstances described in items (1) through
(14) below. 
  

	 	(1)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld solely by reason of the beneficial owner:

  

	 	(a)	having a relationship with the United States as a citizen, resident or otherwise; 

  

	 	(b)	having had such a relationship in the past; or 

  

	 	(c)	being considered as having had such a relationship. 

  

	 	(2)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld solely by reason of the beneficial owner:

  

	 	(a)	being treated as present in or engaged in a trade or business in the United States; 

  

	 	(b)	being treated as having been present in or engaged in a trade or business in the United States in the past; or 

  

	 	(c)	having or having had a permanent establishment in the United States. 

  

	 	(3)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld in whole or in part by reason of the
beneficial owner being or having been any of the following (as such terms are defined in the Internal Revenue Code of 1986, as amended): 

  

	 	(a)	personal holding company; 

  

	 	(b)	foreign private foundation or other foreign tax-exempt organization; 

  

	 	(c)	passive foreign investment company; 

  

	 	(d)	controlled foreign corporation; or 

  

	 	(e)	corporation which has accumulated earnings to avoid United States federal income tax. 

  
 R-4 

	 	(4)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld solely by reason of the beneficial owner
owning or having owned, actually or constructively, 10 percent or more of the total combined voting power of all classes of stock of the Company entitled to vote or by reason of the beneficial owner being a bank that has invested in a Subordinated
Note as an extension of credit in the ordinary course of its trade or business. 

 For purposes of items (1) through (4) above,
“beneficial owner” means a fiduciary, settlor, beneficiary, member or shareholder of the holder if the holder is an estate, trust, partnership, limited liability company, corporation or other entity, or a person holding a power over an
estate or trust administered by a fiduciary holder. 
  

	 	(5)	Additional Amounts will not be payable to any beneficial owner of a Subordinated Note that is a: 

  

	 	(a)	fiduciary; 

  

	 	(b)	partnership; 

  

	 	(c)	limited liability company; or 

  

	 	(d)	other fiscally transparent entity 

 or that is not the sole beneficial owner of the Subordinated
Note, or any portion of the Subordinated Note. However, this exception to the obligation to pay Additional Amounts will only apply to the extent that a beneficiary or settlor in relation to the fiduciary, or a beneficial owner or member of the
partnership, limited liability company or other fiscally transparent entity, would not have been entitled to the payment of an Additional Amount had the beneficiary, settlor, beneficial owner or member received directly its beneficial or
distributive share of the payment. 
  

	 	(6)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld solely by reason of the failure of the
beneficial owner or any other person to comply with applicable certification, identification, documentation or other information reporting requirements. This exception to the obligation to pay Additional Amounts will only apply if compliance with
such reporting requirements is required by statute or regulation of the United States or by an applicable income tax treaty to which the United States is a party as a precondition to exemption from such tax, assessment or other governmental charge.

  

	 	(7)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is collected or imposed by any method other than by withholding
from a payment on a Subordinated Note by the Company or a paying agent. 

  
 R-5 

	 	(8)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld by reason of a change in law, regulation,
or administrative or judicial interpretation that becomes effective more than 15 days after the payment becomes due or is duly provided for, whichever occurs later. 

 

	 	(9)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is imposed or withheld by reason of the presentation by the
beneficial owner of a Subordinated Note for payment more than 30 days after the date on which such payment becomes due or is duly provided for, whichever occurs later. 

 

	 	(10)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any: 

  

	 	(a)	estate tax; 

  

	 	(b)	inheritance tax; 

  

	 	(c)	gift tax; 

  

	 	(d)	sales tax; 

  

	 	(e)	excise tax; 

  

	 	(f)	transfer tax; 

  

	 	(g)	wealth tax; 

  

	 	(h)	personal property tax; or 

  

	 	(i)	any similar tax, assessment, withholding, deduction or other governmental charge. 

  

	 	(11)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment, or other governmental charge required to be withheld by any paying agent from a payment of
principal or interest on a Subordinated Note if such payment can be made without such withholding by any other paying agent. 

  

	 	(12)	Additional amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any tax, assessment or other governmental charge that is required to be made pursuant to any European Union directive
on the taxation of savings income or any law implementing or complying with, or introduced to conform to, any such directive. 

  

	 	(13)	 Additional amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any withholding, deduction, tax, duty assessment
or other governmental charge that would not have been imposed but for a failure by the holder or beneficial owner of a Subordinated Note (or any financial institution through which the holder or beneficial owner holds the Subordinated Note or
through which payment on the Subordinated Note is made) to take any action (including entering into an agreement with the Internal Revenue Service, or a 

  
 R-6 

	 	
governmental authority of another jurisdiction if the holder is entitled to the benefits of an intergovernmental agreement between that jurisdiction and the United States) or to comply with any
applicable certification, documentation, information or other reporting requirement or agreement concerning accounts maintained by the holder or beneficial owner (or any such financial institution), or concerning ownership of the holder or
beneficial owner, or any substantially similar requirement or agreement. 

  

	 	(14)	Additional Amounts will not be payable if a payment on a Subordinated Note is reduced as a result of any combination of items (1) through (13) above. 

Except as specifically provided herein, the Company will not be required to make any payment of any tax, assessment or other governmental
charge imposed by any government or a political subdivision or taxing authority of such government. 
 As used in this Subordinated Note,
“United States person” means: 
  

	 	(a)	any individual who is a citizen or resident of the United States; 

  

	 	(b)	any corporation, partnership or other entity created or organized in or under the laws of the United States; 

  

	 	(c)	any estate if the income of such estate falls within the federal income tax jurisdiction of the United States regardless of the source of such income and 

 

	 	(d)	any trust if (i) a United States court is able to exercise primary supervision over its administration and one or more United States persons have the authority to control all of the substantial decisions of the
trust; or (ii) it has a valid election in effect under applicable United States Treasury regulations to be treated as a United States person. 

Additionally, “non-United States person” means a person who is not a United States person,
and “United States” means the states of the United States of America and the District of Columbia, but excluding its territories and its possessions. 

Except as provided below, the Subordinated Notes may not be redeemed prior to maturity. 

 

	 	(1)	The Company may, at its option, redeem the Subordinated Notes if: 

  

	 	(a)	the Company becomes or will become obligated to pay Additional Amounts as described above; 

  

	 	(b)	the obligation to pay Additional Amounts arises as a result of any change in the laws, regulations or rulings of the United States, or an official position regarding the application or interpretation of such laws,
regulations or rulings, which change is announced or becomes effective on or after June 1, 2015 and 

  

	 	(c)	the Company determines, in its business judgment, that the obligation to pay such Additional Amounts cannot be avoided by the use of reasonable measures available to it, other than substituting the obligor under the
Subordinated Notes or taking any action that would entail a material cost to the Company. 

  
 R-7 

	 	(2)	The Company may also redeem the Subordinated Notes, at its option, if: 

  

	 	(a)	any act is taken by a taxing authority of the United States on or after June 1, 2015 , whether or not such act is taken in relation to the Company or any affiliate, that results in a substantial probability that
the Company will or may be required to pay Additional Amounts as described above; 

  

	 	(b)	the Company determines, in its business judgment, that the obligation to pay such Additional Amounts cannot be avoided by the use of reasonable measures available to it, other than substituting the obligor under the
Subordinated Notes or taking any action that would entail a material cost to the Company and 

  

	 	(c)	the Company receives an opinion of independent counsel to the effect that an act taken by a taxing authority of the United States results in a substantial probability that the Company will or may be required to pay the
Additional Amounts described above, and delivers to the Trustee a certificate, signed by a duly authorized officer, stating that based on such opinion the Company is entitled to redeem the Subordinated Notes pursuant to their terms.

 Any redemption of the Subordinated Notes as set forth in clauses (1) or (2) above shall be in whole, and not in part, and will be
made at a redemption price equal to 100% of the principal amount of the Subordinated Notes Outstanding plus accrued interest thereon to the date of redemption. Holders shall be given not less than 30 days nor more than 60 days prior notice by the
Trustee of the date fixed for such redemption. 
 All terms used in this Subordinated Note which are defined in the Indenture shall have the
meanings assigned to them in the Indenture. The Subordinated Notes are governed by the laws of the State of New York. 

  
 R-8 

 SCHEDULE OF EXCHANGES OF INTERESTS 

The following exchanges of a part of this Subordinated Note for an interest in another Global Security or for a certificated Subordinated
Note, or exchanges of a part of another Global Security or certificated Subordinated Note for an interest in this Subordinated Note, have been made: 
  

											
	 Date of Exchange
	  	Amount of decrease
in Principal Amount
of this Subordinated
Note	  	Amount of increase
in Principal Amount
of this Subordinated
Note	  	Principal Amount of
this Subordinated
Note following such
decrease (or
increase)	 	  	Signature of
Authorized
Officer of
Trustee or
Fiscal Agent
					
	 June 9, 2015 (original issuance)
	  		  		  	C$	600,000,000	  	  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	
		  		  		  				  	

  

	*	This Schedule may be used by the Trustee, Paying Agent, Fiscal Agent or other agent of the Company in respect of this Subordinated Note, and, if so used, shall be deemed a part thereof for all purposes.

  
 R-9

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