Obligation Canadian Housing Trust 2.35% ( CA13509PGF41 ) en CAD

Canadian Housing Trust

100 % ▲

Canada

CA13509PGF41 ( en CAD )

2.35% par an ( paiement semestriel )

14/03/2028

Prospectus brochure de l'obligation Canada Housing Trust[TM] No. 1 CA13509PGF41 en CAD 2.35%, échéance 14/03/2028

5 000 CAD

2 500 000 000 CAD

13509PGF4

15/09/2025 ( Dans 137 jours )

Canada Housing Trust? No. 1 est un fonds commun de placement non garanti qui investit principalement dans des titres de créance hypothécaires résidentiels canadiens.

L'Obligation émise par Canadian Housing Trust ( Canada ) , en CAD, avec le code ISIN CA13509PGF41, paye un coupon de 2.35% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 14/03/2028

Offering Circular
Dated November 15, 2017
C$2,500,000,000 Aggregate Principal Amount
2.350% Canada Mortgage BondsTM, Series 80, to mature March 15, 2028
Fully Guaranteed as to Principal and Interest by
Canada Mortgage and Housing Corporation
(An agent of Her Majesty in right of Canada)
Issued by
CANADA HOUSING TRUSTTM NO. 1
ISSUE PRICE: 99.774%
The bonds offered hereby (the "Bonds") are 2.350% Canada Mortgage BondsTM, Series 80, to mature March 15,
2028, of Canada Housing TrustTM No. 1 (the "Issuer"), a trust established under the laws of the province of
Ontario, Canada pursuant to a declaration of trust dated April 9, 2001, as amended, made by its trustee CIBC
Mellon Trust Company, and are fully guaranteed as to timely payment of principal and interest by Canada
Mortgage and Housing Corporation ("CMHC" or the "Guarantor"), as agent of Her Majesty in right of Canada
(see "Description of the Bond Indenture and the Bonds--CMHC Guarantee"). The Issuer is authorized to issue
Bonds in one or more series and on one or more issue dates pursuant to the Bond Indenture (as defined below).
The Bonds are not redeemable prior to maturity (see "Description of the Bond Indenture and the Bonds--
Maturity"). The Bonds bear interest at the rate of 2.350% per annum and, at the issue price of 99.774% of their
principal amount, will yield at date of issue approximately 2.375%, mature on March 15, 2028 and will be issued
in the form of a fully registered global certificate or in fully registered uncertificated form (in either of the
foregoing forms, the "Global Bond") in the name of CDS & CO. as nominee of CDS Clearing and Depository
Services Inc. ("CDS") and held by CDS. The Bonds will be ready for delivery in book-entry only form through
CDS, Clearstream Banking, société anonyme ("Clearstream, Luxembourg") and Euroclear Bank S.A./N.V.
("Euroclear"), as the case may be, on or about November 22, 2017. Beneficial interests in the Global Bond will
be represented through book-entry accounts of financial institutions acting on behalf of beneficial owners as
direct and indirect participants of CDS, Clearstream, Luxembourg and Euroclear. Owners of beneficial interests
in the Global Bond will not be entitled to have Bonds registered in their names, will not receive or be entitled to
receive Bonds in definitive form and will not be considered holders thereof except in limited circumstances as
described in the Bond Indenture (as defined below) and the Global Bond.
Half-yearly interest (March 15 and September 15) on the Global Bond will be payable in lawful money of
Canada following the first interest payment which shall be payable on March 15, 2018 for the period from
November 22, 2017 to March 15, 2018, without deduction for or on account of Canadian withholding taxes, to
the extent set forth herein. The final payment of interest and repayment of principal will be due March 15, 2028.
Owners of beneficial interests in the Global Bond will receive payment in accordance with the customary
procedures of CDS, Clearstream, Luxembourg and Euroclear. Bonds will only be sold in minimum
denominations of C$5,000 and integral multiples thereof.
Application has been made for the Bonds to be admitted on the Official List of the Luxembourg Stock Exchange
and for such Bonds to be admitted to trading on the Euro MTF Market. The Euro MTF Market is not a regulated
market for purposes of the Markets in Financial Instruments Directive (Directive 2004/39/EC). This Offering
Circular constitutes a prospectus for the purpose of Part IV of the Luxembourg Law dated July 10, 2005 on
Prospectuses for Securities, as amended, but does not constitute a prospectus for purposes of Directive
2003/71/EC, as amended (the "Prospectus Directive"). See "Notice Regarding Offers in the EEA".
The Bonds will be assigned a rating of "AAA" by Standard & Poor's, "Aaa" by Moody's Investors Service
and "AAA" by DBRS Limited. A security rating is not a recommendation to buy, sell or hold securities
and may be subject to suspension, reduction or withdrawal at any time by the assigning rating agency.
National Bank
CIBC Capital
RBC Capital
TD Securities
Financial
Markets
Markets
BMO Capital
Scotiabank Global
Bank of America
Desjardins
Markets
Banking and Markets
Merrill Lynch
Securities
HSBC Securities
Laurentian Bank
Casgrain & Company
Securities

The Issuer, in relation only to the information contained herein that relates to the Issuer or the Bonds, and
the Guarantor, in relation only to the information contained herein that relates to the Guarantor or the CMHC
Guarantee (as defined below), confirms that this Offering Circular contains all information with respect to the
Issuer and the Bonds, and the Guarantor and the CMHC Guarantee, respectively, which is material in the context
of the issue of the Bonds; that such information is true and accurate in all material respects and is not misleading;
the Issuer confirms that there is no other fact the omission of which makes this document as a whole or any of
such information misleading and the Guarantor confirms that there is no other fact relating to the Guarantor or
the CMHC Guarantee the omission of which makes this document as a whole or any of such information
misleading; that the Issuer has made all reasonable enquiries to ascertain all facts material for the purposes
aforesaid; and that the Guarantor has made all reasonable inquiries to ascertain all facts relating to the Guarantor
and the CMHC Guarantee material for the purposes aforesaid. The Issuer accepts responsibility for the
information contained in this Offering Circular and the Guarantor accepts responsibility for the information
contained in this Offering Circular that relates to the Guarantor and the CMHC Guarantee.
No person is authorised to give any information or to make any representation not contained in this Offering
Circular and, if given or made, any information or representation not contained herein may not be relied upon as
having been authorised by or on behalf of the Issuer, the Guarantor or by any of the Underwriters named in
"Underwriting and Distribution" (the "Underwriters"). Neither the delivery of this Offering Circular nor any
sale of the Bonds shall at any time imply that the information contained herein is correct at any time subsequent
to its date.
This Offering Circular does not constitute an offer of, or an invitation by or on behalf of the Issuer, the
Guarantor or the Underwriters to purchase, any of the Bonds.
The distribution of this Offering Circular and the offering of the Bonds in certain jurisdictions may be
restricted by law. Persons into whose possession this Offering Circular comes are required by the Issuer, the
Guarantor and the Underwriters to inform themselves as to, and to observe, any such restrictions. For a
description of certain restrictions on the offering and sale of Bonds, and on the distribution of this Offering
Circular, see "Underwriting and Distribution".
In this Offering Circular all references to "$" and "C$" are to the legal currency of Canada and all
references to the "European Economic Area" or "EEA" are to the member states of the European Union
together with Iceland, Norway and Liechtenstein (each, a "Member State").
NOTICE REGARDING OFFERS IN THE EEA
A prospectus is not required under the Prospectus Directive for the offering of the Bonds. This Offering
Circular does not constitute a prospectus under the Prospectus Directive and has been prepared on the basis that
any offer of the Bonds in any Member State of the European Economic Area which has implemented the
Prospectus Directive (each a "Relevant Member State") will be made pursuant to an exemption under the
Prospectus Directive, as implemented in that Relevant Member State, from the requirement to publish a
prospectus for offers of Bonds and the Bonds will not be admitted to trading on a regulated market in the EEA.
Accordingly any person making or intending to make an offer in that Relevant Member State of Bonds which are
the subject of the offering contemplated in this Offering Circular may only do so in circumstances in which no
obligation arises for the Issuer or any of the Underwriters to publish a prospectus pursuant to Article 3 of the
Prospectus Directive in relation to such offer. Neither the Issuer nor the Underwriters have authorised, nor do
they authorise, the making of any offer of Bonds through any financial intermediary, other than offers by the
Underwriters which constitute the final placement of the Bonds contemplated in this Offering Circular.
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TABLE OF CONTENTS
Page
DESCRIPTION OF THE BOND INDENTURE AND THE BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
CANADA HOUSING TRUSTTM NO. 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
CANADA MORTGAGE AND HOUSING CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
CANADIAN FEDERAL INCOME TAX CONSIDERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
CLEARING AND SETTLEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13
UNDERWRITING AND DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17
IN
CONNECTION
WITH
THIS
ISSUE,
NATIONAL
BANK
FINANCIAL
INC.
(THE
"STABILISING MANAGER") (OR ANY PERSON(S) ACTING ON BEHALF OF THE STABILISING
MANAGER) MAY OVER-ALLOT BONDS OR EFFECT TRANSACTIONS WITH A VIEW TO
SUPPORTING THE MARKET PRICE OF THE BONDS AT A LEVEL HIGHER THAN THAT WHICH
MIGHT OTHERWISE PREVAIL. HOWEVER, STABILISATION MAY NOT NECESSARILY OCCUR.
ANY STABILISING ACTION MAY BEGIN ON OR AFTER THE DATE ON WHICH ADEQUATE
PUBLIC DISCLOSURE OF THE TERMS OF THE OFFER OF THE BONDS IS MADE AND, IF
BEGUN, MAY BE ENDED AT ANY TIME, BUT IT MUST END NO LATER THAN THE EARLIER OF
30 DAYS AFTER NOVEMBER 22, 2017 AND 60 DAYS AFTER THE DATE OF ALLOTMENT OF THE
BONDS. ANY STABILISATION ACTION OR OVER-ALLOTMENT MUST BE CONDUCTED BY THE
STABILISING MANAGER (OR ANY PERSON(S) ACTING ON BEHALF OF THE STABILISING
MANAGER) IN ACCORDANCE WITH ALL APPLICABLE LAWS AND RULES.
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DESCRIPTION OF THE BOND INDENTURE AND THE BONDS
General
The Bonds will be issued by the Issuer as a series of bonds that have the benefit of and are subject to a bond
trust indenture (the "Base Indenture") dated as of March 14, 2011 between the Issuer, Computershare Trust
Company of Canada and Computershare Trust Company, N.A. (the "Bond Trustees") as supplemented by a
supplemental indenture between the Issuer and the Bond Trustees to be dated November 22, 2017 (the
"Supplemental Indenture"; the Base Indenture as so supplemented is referred to herein as the "Bond
Indenture"). CMHC, as agent of Her Majesty in right of Canada ("Canada") has guaranteed the timely payment
of principal and interest payable on the Bonds (the "CMHC Guarantee"). The CMHC Guarantee is given
pursuant to a commitment to guarantee obligations agreement dated as of April 9, 2001 (as amended,
supplemented, restated or replaced from time to time) between the Issuer and the Guarantor in respect of bonds
to be issued pursuant to the Base Indenture as supplemented from time to time. The text of, and statutory
authority for, the CMHC Guarantee is set out under "CMHC Guarantee" below. The CMHC Guarantee will be
set out in the Supplemental Indenture; if the Global Bond is issued in certificated form, it will be set out on the
Global Bond, and if Bonds are issued in definitive form, on the certificate for each such Bond. The Issuer may
issue further bonds, including further Series 80 Bonds, as described under "Further Issues" below.
The terms and conditions of the Bond Indenture and the Bonds are summarised below and are subject to the
detailed provisions of the Bond Indenture and the exhibits thereto, including the form of the Global Bond.
Investors may review a copy of the Bond Indenture and the Global Bond (if issued in certificated form) during
normal business hours at the offices of the Bond Trustees at 100 University Avenue, 8th Floor, Toronto, Ontario,
Canada and 8742 Lucent Boulevard, Suite 225, City of Highlands Ranch, Colorado, United States of America
and at the offices of the Paying Agent in Luxembourg set out below. Holders of the Bonds are bound by, and
deemed to have notice of, the provisions contained in the Bond Indenture.
Status of the Bonds
The Bonds constitute direct and unconditional obligations of the Issuer, shall rank pari passu and without
any preference among themselves, and have a second-ranking security interest in the Secured Property (as
defined below).
References hereinafter to principal and interest in respect of the Bonds shall be deemed also to refer to any
Additional Amounts which may be payable under the provisions set out under "Taxation" below.
Security Interest
To secure the due payment of all principal of, and interest (including interest on overdue principal and
interest) on and premium (if any) and other monies for the time being and from time to time payable on the
Bonds, the Issuer has unconditionally mortgaged, charged to and in favour of the Bond Trustees and granted the
Bond Trustees a security interest (the "Security Interest") in all the right, title and interest of the Issuer in and to
its real and personal property, realizable against all of such assets excluding (i) the proceeds of any future bonds
of a Specified Asset Series (see below "Further Issues"), (ii) the assets purchased with such proceeds and all
proceeds from the disposition of such assets, (iii) all renewals, substitutions and replacements for any of the
foregoing, and (iv) amounts receivable by the Issuer under all swap and other hedge documents relating to such
assets (such excluded assets are hereinafter referred to as the "Series Assets", and the right, title and interest of
the Issuer in and to its real and personal property other than the Series Assets is hereinafter referred to as the
"Secured Property"). The Security Interest is subject to CMHC's Security Interest described below.
CMHC Guarantee
The following is the text of the CMHC Guarantee, which will be set out in the Supplemental Indenture, on
the Global Bond if issued in certificated form and, if issued, on each Bond in definitive form:
"Canada Mortgage and Housing Corporation as agent for Her Majesty in right of Canada hereby
guarantees the timely payment of the principal and interest set forth in this instrument in accordance
with the terms and conditions of this instrument, pursuant to the powers given to it in Sections 4 and
14 of the National Housing Act, R.S.C. 1985, as amended, which expressly provide that `Every right
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or obligation acquired or incurred by the Corporation under this Act, whether in its name or in the
name of Her Majesty, is a right or obligation of Her Majesty' (Section 4), and `The Corporation may
guarantee payment of any or all principal or interest, or both, in respect of securities issued on the
basis of housing loans' (Section 14). It is certified that no provision of any law or contract adversely
affects the rights of the holder to the benefit of this guarantee."
In the event of any Payment Default (as defined in the Bond Indenture see "Payment Default" below) the
holders of the Bonds through the Bond Trustees will have recourse to the CMHC Guarantee and to the Secured
Property pursuant to the Security Interest.
Status of the CMHC Guarantee
The CMHC Guarantee constitutes a direct unconditional obligation of the Guarantor and as such carries the
full faith and credit of Canada and constitutes a direct unconditional obligation of Canada. Amounts payable
under the CMHC Guarantee of the principal of and interest on the Bonds constitute a charge on and are payable
out of the Consolidated Revenue Fund of Canada. The CMHC Guarantee ranks equally with all of the
Guarantor's other unsecured and unsubordinated indebtedness and obligations from time to time outstanding. As
security for the Issuer's obligations to the Guarantor, including its obligation to indemnify the Guarantor in
respect of the CMHC Guarantee, the Issuer has granted, in favour of the Guarantor, a first ranking mortgage of,
charge on and security interest in all of the present and after acquired undertaking and property of the Issuer
(other than consumer goods and the initial $10,000 of capital of the Issuer) ("CMHC's Security Interest").
Form, Denomination and Registration
The Bonds will be issued in the form of a fully registered Global Bond registered in the name of CDS &
CO., as nominee of CDS and held by CDS. Beneficial interests in the Global Bond will be represented through
book-entry accounts of financial institutions acting on behalf of beneficial owners as direct and indirect
participants in CDS. Investors may elect to hold beneficial interests in the Global Bond directly through any of
CDS (in Canada) or Clearstream, Luxembourg or Euroclear (in Europe) if they are participants of such systems,
or indirectly through organisations which are participants in such systems. Clearstream, Luxembourg and
Euroclear will hold interests on behalf of their participants through customers' securities accounts in the names
of Clearstream, Luxembourg and Euroclear, respectively, on the books of their respective Canadian
subcustodians (the "Canadian Subcustodians"), each of which is a Canadian Schedule I chartered bank, which
in turn will hold such interests in customers' securities accounts in the names of the Canadian Subcustodians on
the books of CDS. Except in the limited circumstances described herein, owners of beneficial interests in the
Global Bond will not be entitled to have Bonds registered in their names, will not receive or be entitled to receive
physical delivery of Bonds in definitive form and will not be considered owners or holders thereof under the
Bond Indenture. See "Description of the Bond Indenture and the Bonds Title" and "Description of the Bond
Indenture and the Bonds Definitive Certificates".
Bonds will only be sold in minimum denominations of C$5,000 and integral multiples thereof.
The Bonds will be recorded in a register maintained by Computershare Trust Company of Canada (in its
capacity as one of the Bond Trustees) and will be registered in the name of CDS & CO., for the benefit of owners
of beneficial interests in the Global Bond, including participants of Clearstream, Luxembourg and Euroclear.
The Bond Trustees will be responsible for (i) maintaining a record of the aggregate holdings of the Bonds
by CDS & CO.; (ii) ensuring that payments of principal and interest in respect of the Bonds are duly credited to
CDS & CO.; and (iii) transmitting to the Issuer any notices from the registered holders of Bonds.
The Bond Trustees will not impose any fees on the registered holders of Bonds in respect of the Bonds,
other than reasonable fees for the replacement of lost, stolen, mutilated or destroyed Bonds. However, owners of
beneficial interests in the Global Bond may incur fees payable in respect of the maintenance and operation of the
book-entry accounts in which such interests are held with the clearing systems.
Title
Subject to applicable law and the terms of the Bond Indenture, the Issuer, the Guarantor and the Bond
Trustees will treat the person in whose name the Global Bond is registered, initially CDS & CO., as the owner of
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such Global Bond for the purpose of making payments of principal and interest on the Bonds represented thereby
and for all other purposes whatsoever, except in respect of the payment of Additional Amounts. Therefore, none
of the Issuer, the Guarantor nor the Bond Trustees has any direct responsibility or liability for the payment of
principal or interest on the Bonds to owners of beneficial interests in the Global Bond.
Interest
The Bonds will bear interest from November 22, 2017 at a rate of 2.350% per annum. Interest from and
including November 22, 2017 to but excluding March 15, 2018 will be payable in arrears on March 15, 2018.
Thereafter, interest on the Bonds will be payable in two equal semi-annual instalments in arrears on March 15
and September 15 in each year (each an interest payment date) until maturity. Any overdue principal or interest
on the Bonds shall bear interest at the rate of 2.350% per annum (before as well as after default) until paid, or if
earlier, when the full amount of the moneys payable has been received by the Bond Trustees and notice to that
effect has been given in accordance with "Notices" below. With respect to amounts payable on a day that is not a
business day, see "Description of the Bond Indenture and the Bonds Payments" below.
Whenever it is necessary to compute any amount of accrued interest in respect of the Bonds for a period of
less than one full year, other than with respect to regular semi-annual interest payments, such interest shall be
calculated on the basis of the actual number of days in the period and a 365-day year.
Payments
The principal of and interest on the Bonds (including Bonds in definitive form issued in exchange for the
Global Bond as described under "Definitive Certificates") are payable by the Issuer in Canadian dollars to the
persons in whose names the Bonds are registered as determined on the 15th day preceding any interest payment
date or at maturity, as the case may be.
Computershare Trust Company of Canada will act as the principal paying agent and make all payments to
the registered holders of Bonds in accordance with the Bond Indenture. In addition, the Issuer and the Bond
Trustees will appoint The Bank of New York Mellon (Luxembourg) S.A. in Luxembourg as a paying agent for
the Bonds. Under the terms of the Bond Indenture, the Issuer may change or retain additional paying agents with
the prior consent of the Guarantor and the Bond Trustees. With respect to payments on Bonds in definitive form,
see "Definitive Certificates".
Ownership positions within each clearing system will be determined in accordance with the normal
conventions observed by such system. None of the Issuer, the Guarantor, the Bond Trustees nor any paying agent
will have any responsibility or liability for any payments made by CDS, Clearstream, Luxembourg or Euroclear
on account of beneficial interests in the Global Bond or for maintaining, supervising or reviewing any aspect of
the records of such clearing systems relating to such beneficial interests.
If any date for payment in respect of any Bond is not a business day, the holder thereof shall not be entitled
to payment until the next following business day, and no further interest shall be paid in respect of the delay in
such payment. In this paragraph "business day" means a day, other than a Saturday or Sunday, on which banking
institutions in the City of Toronto and in the applicable place of payment are not authorised or obligated by law
or executive order to be closed.
Taxation
All payments of, or in respect of, principal and interest on the Bonds will be made without withholding of or
deduction for, or on account of, any present or future taxes, duties, assessments or charges of whatsoever nature
imposed or levied by or on behalf of the Government of Canada, or any province or political subdivision thereof
or any authority thereof or agency therein having power to tax, unless such taxes, duties, assessments or charges
are required by law or by the administration or official interpretation thereof to be withheld or deducted. In that
event, the Issuer will pay such additional amounts (the "Additional Amounts") as will result (after withholding
or deduction of the said taxes, duties, assessments or charges) in the payment to the beneficial owners of Bonds
of the amounts which would otherwise have been payable in respect of the Bonds in the absence of such taxes,
duties, assessments or charges, except that no such Additional Amounts shall be payable with respect to any
Bond presented for payment:
(a) by or on behalf of a beneficial owner who is subject to such taxes, duties, assessments or charges in
respect of such Bond by reason of the beneficial owner being connected with Canada otherwise than
merely by the holding or ownership as a non-resident of Canada of such Bond; or
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(b) more than 15 days after the Relevant Date, except to the extent that the holder thereof would have been
entitled to such Additional Amounts on presenting the same for payment on the last day of such period
of 15 days. For this purpose the "Relevant Date" in relation to any Bond means whichever is the later
of:
(i)
the date on which the payment in respect of such Bond becomes due and payable; or
(ii) if the full amount of the monies payable on such date in respect of such Bond has not been
received by the Bond Trustees on or prior to such date, the date on which notice is duly given to
the holders of Bonds that such monies have been so received.
Maturity
The principal amount of the Bonds shall be due and payable on March 15, 2028.
The Bonds are not subject to any sinking fund and are not redeemable at the option of the Issuer prior to
maturity and are not repayable at the option of the holder prior to maturity. However, the Issuer may, at any time
and from time to time, following the completion of any stabilising action described in this Offering Circular,
purchase Bonds in the secondary market at prevailing market prices. Such purchased Bonds may be delivered to
the Bond Trustees for cancellation or may be held on behalf of the Issuer, each in accordance with the terms of
the Bond Indenture. Any purchase of Bonds for cancellation must be made in compliance with the Issuer's
internal parameters regarding same, the terms of which parameters may change at any time without notice in the
Issuer's sole and absolute discretion. The parameters are currently (as at the date of this Offering Circular) that
no Bonds may be purchased for cancellation unless (i) the Bonds have a remaining term to maturity of no more
than 3.5 years at the time of purchase for cancellation, (ii) such purchase and cancellation occurs after the 59th
day following November 22, 2017 or the date of any future issuance of bonds of the same series as the Bonds,
and during a period that is not 15 days immediately prior to any interest payment date, and (iii) the outstanding
principal amount of the Bonds and any bonds of the same series as the Bonds following the cancellation shall not
be less than $3,000,000,000, other than during the last six months of their term when no minimum shall apply.
Payment Default
The Bond Indenture provides that a "Payment Default" is a default in the payment of the whole or any part
of the principal or interest on any of the Bonds that are outstanding when the same shall become due and payable,
whether by reason of maturity, acceleration or otherwise. The Bond Trustees are required to give all holders (the
"Affected Bondholders") of bonds of the same series as the bond or bonds in respect of which a Payment
Default has occurred (the "Affected Series"), the Issuer and the Guarantor prompt notice in writing of any
Payment Default (unless such default shall have been remedied prior to the giving of such notice) and to demand
payment by the Guarantor under the CMHC Guarantee of all amounts owing and unpaid on the outstanding
bonds of all Affected Series, together with interest on unpaid interest to the date of such payment. If so directed
by the holders of bonds of the Affected Series, or if the Bond Trustees so elect where the Payment Default has
continued for at least 1 day, the Bond Trustees shall, in addition, forthwith make written demand for the unpaid
balance of the principal of all outstanding bonds of the Affected Series. All such demanded amounts shall
become due and payable immediately upon delivery of any such demand by the Bond Trustees.
Bondholders' Right to Direct Bond Trustees After Payment Default
The Bond Indenture provides that during the continuance of a Payment Default, the holders of a majority in
principal amount of the outstanding bonds of the Affected Series shall have the right by a direction approved by
ordinary resolution of such holders (i) to direct the Bond Trustees to exercise or to refrain from exercising any
right or to enforce any remedy granted to them by the Bond Indenture; and (ii) to direct the time, method and
place of the exercise of any such right or the enforcement of any such remedy; provided that, notwithstanding the
foregoing and any other provision of the Bond Indenture, the Bond Trustees are obligated to demand payment of
the CMHC Guarantee by the Guarantor unless all of the holders of the bonds of the Affected Series shall have
directed the Bond Trustees not to make such demand.
Regarding the Bond Trustees
Except as otherwise provided in the Bond Indenture, the rights, powers, duties and obligations conferred or
imposed on the Bond Trustees shall be conferred or imposed upon and exercised or performed by the Bond
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Trustees jointly, provided that if the Bond Trustees cannot mutually agree upon a course of conduct in the
exercise or performance of the rights, powers, duties and obligations conferred or imposed upon the Bond
Trustees, Computershare Trust Company, N.A. shall be entitled to determine such course of conduct in the
exercise or performance of the rights, powers, duties and obligations conferred upon the Bond Trustees.
Definitive Certificates
No beneficial owner of Bonds will be entitled to receive physical delivery of Bonds in definitive form
except in the limited circumstances described below.
If, as more particularly described in the Bond Indenture and subject to the requirements of the Bond
Indenture, (a) the Issuer advises the Bond Trustees that CDS (or any successor clearing agency) is unwilling or
unable to discharge its responsibilities as a clearing agency and such clearing agency is unable to locate a
qualified successor, or (b) the Issuer, at its option, advises the Bond Trustees that it elects to terminate the book
entry system with respect to the Bonds, the Bond Trustees will advise the registered holders of the Bonds of such
event and of the availability of certificated Bonds to beneficial owners of the Bonds. Notice of such event will
also be published in a leading newspaper having general circulation in Luxembourg. Upon transfer by the
relevant clearing agency of the Global Bond to the Issuer, including surrender of the certificate if the Global
Bond is issued in certificated form, the Bond Trustees will authenticate and deliver certificated Bonds.
For so long as the Bonds are listed on the Luxembourg Stock Exchange and if the rules of such stock
exchange on which the Bonds are listed so require, the Issuer has agreed to appoint and maintain a transfer agent
and paying agent in Luxembourg to act on its behalf. In addition, if Bonds in definitive form are issued, the
Issuer will appoint and maintain a paying agent and transfer agent in London. Fully registered Bonds in definitive
form may be presented at the office of the Luxembourg transfer agent or London transfer agent, for registration
of transfer or exchange by the Bond Trustees in accordance with the Bond Indenture. Payments of interest on
fully registered Bonds in definitive form will be made by the Bond Trustees in accordance with the Bond
Indenture. Fully registered Bonds in definitive form may be surrendered at the office of the Luxembourg paying
agent or London paying agent for payment of principal at maturity.
Notices
All notices to the registered holders of Bonds will be mailed or delivered to such holders at their addresses
indicated in records maintained by the Bond Trustees and, as long as the Bonds are listed on the Luxembourg
Stock Exchange and the rules of the Luxembourg Stock Exchange so require, published in a leading newspaper
having general circulation in Luxembourg (which is expected to be the Luxemburger Wort) and/or on the website
of the Luxembourg Stock Exchange at www.bourse.lu. Any such notice shall be deemed to have been given on
the date of such delivery or publication, as the case may be, or in the case of mailing, on the third business day
after such mailing.
Prescription
The Bonds may become void unless presented for payment within a period of six years from their respective
Relevant Dates (as defined under "Taxation" herein) for payment thereof.
Modification
The Bond Indenture may be amended or supplemented by the Issuer, the Bond Trustees and, where
applicable, the Guarantor, without notice to or the consent of the holder of any Bond, for certain purposes set out
in the Bond Indenture, including providing for the issue of other series of bonds, or additional Bonds as described
under "Further Issues" below, curing any ambiguity, or correcting or supplementing any defective provisions
contained therein as the Issuer or the Guarantor may deem necessary or desirable, provided such provisions are
not inconsistent with the Bond Indenture and shall not, as confirmed by a written legal opinion from legal
counsel who is reasonably acceptable to the Bond Trustees, adversely affect the interests of the owners of
beneficial interests in the Bonds.
With the consent of Affected Bondholders passed by extraordinary series resolution of the holders of bonds
of each series affected thereby, (1) compliance by the Issuer with any of the terms of the Bond Indenture may be
waived, or (2) the Issuer and the Bond Trustees may enter into any supplemental indenture for the purpose of
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adding any provisions to or changing in any manner or eliminating any of the provisions of the Bond Indenture or
of modifying in any manner the rights of the holders of bonds issued under the Bond Indenture; notwithstanding
the foregoing, no such waiver or supplemental indenture shall:
(a) without the consent of all holders of Bonds, (i) change the stated maturity or reduce the principal of the
Bonds, (ii) extend the time of payment of, or reduce the rate of interest thereon, or (iii) change the
currency in which the Bonds or the interest thereon is payable; or
(b) without the consent of all holders of Bonds (i) terminate or modify the CMHC Guarantee or the
obligations of the Guarantor thereunder, (ii) reduce the amount of the CMHC Guarantee, (iii) eliminate,
modify or condition the duties of the Bond Trustees to demand payment of the CMHC Guarantee or
otherwise to comply with the provisions of the Bond Indenture relating to such demand or the
termination and payment of the CMHC Guarantee, or (iv) reduce the percentage in principal amount of
the outstanding bonds of any series, the consent of whose holders is required for any such supplemental
indenture or for any waiver provided in the Bond Indenture or to modify any of the provisions of the
Bond Indenture relating to such consent or waiver.
The Bond Indenture provides that no waiver referred to above will be effective, and neither the Issuer nor
the Bond Trustees may enter into any supplemental indenture, without the prior written consent of the Guarantor,
and any purported action or attempt to take such action so forbidden to be taken will be null and void ab initio
and of no legal effect.
Extraordinary Resolution
The Bond Indenture provides that the expression "extraordinary resolution" means a resolution proposed
to be passed as an extraordinary resolution at a meeting of holders of bonds duly convened for the purpose and
held in accordance with the provisions of the Bond Indenture (see "Description of the Bond Indenture and the
Bonds Meetings of Bondholders") at which the holders of at least 50.1% in principal amount of outstanding
bonds are present in person or by proxy and passed by the favourable votes of the holders of at least 66 2/3% of
the principal amount of outstanding bonds represented at the meeting and voted on a poll upon such resolution.
Such meeting will be adjourned to a date between 21 and 60 days after the date thereof if a quorum of holders of
bonds is not met at the original meeting. At the adjourned meeting the holders present in person or by proxy will
form a quorum and may transact the business for which the meeting was originally convened and a resolution
proposed at such adjourned meeting and passed by the requisite vote as provided above will be an extraordinary
resolution within the meaning of this Indenture, notwithstanding that the holders of 50.1% in principal amount of
the outstanding bonds are not present in person or by proxy at such adjourned meeting. Votes on an extraordinary
resolution will always be given on a poll and no demand for a poll on an extraordinary resolution will be
necessary.
Meetings of Bondholders
The Bond Indenture contains provisions for convening meetings of holders of bonds issued thereunder or
the holders of a series of such bonds. The Bond Trustees may at any time and from time to time and will on
receipt of a written request of the Issuer or a written request signed by the holders of not less than 25% in
principal amount of the outstanding bonds convene a meeting of the holders of such bonds. Notice of such
meetings shall be given to all holders of bonds at least 21 days before the date of the meeting. The Bond
Indenture contains procedures for the giving of such notices and the conduct of such meetings. Except in the case
of a meeting at which an extraordinary resolution is to be proposed, at any meeting of the bondholders a quorum
will consist of holders of bonds present in person or by proxy and representing at least 25% in principal amount
of the outstanding bonds. If a quorum is not present within 30 minutes from the time fixed for holding any
meeting, the meeting, if summoned by the holders of bonds or pursuant to a request of the holders of bonds, will
be dissolved, but in any other case the meeting will be adjourned to the same day in the next week (unless such
day is not a business day, in which case it will be adjourned to the next business day) at the same time and place
and no notice will be required to be given in respect of such adjourned meeting. At the adjourned meeting, the
holders of bonds present in person or by proxy will form a quorum and may transact the business for which the
meeting was originally convened notwithstanding that they may not represent 25% of the principal amount of the
outstanding bonds. On a show of hands every person who is present and entitled to vote, whether as a holder or
as proxy for one or more Bondholders, or both, will have one vote. On a poll each holder of a bond present in
person or represented by a proxy duly appointed by an instrument in writing will be entitled to one vote in
respect of each $1,000 in principal amount of outstanding bonds of which that person is then the holder. A proxy
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need not be a holder of a bond. In the case of joint holders of an outstanding bond, any one of them present in
person or by proxy at the meeting may vote in absence of the other or others; but in case more than one of them
is present in person or by proxy, they must vote together in respect of the outstanding bonds of which they are
joint holders. Copies of the minutes of meetings, including resolutions adopted at such meetings, are available at
the offices of the Bond Trustees.
The procedures applicable for meetings of holders of a series of bonds shall be those set out above with
respect to meetings of holders of bonds, except that all references to holders of bonds, bonds and outstanding
bonds shall be read as "holders of the series of bonds", "bonds of the series" and "outstanding bonds of the
series", respectively, and the relevant provisions relating to meetings of Bondholders shall be read with such
other changes as may be required in the context to adapt such provisions to procedures applicable to meetings
and resolutions of holders of a given series of bonds.
Further Issues
In addition to issuing other series of bonds under the Base Indenture as supplemented from time to time that
will have the benefit of the Security Interest, the Issuer may from time to time, without notice to or the consent of
the holders of the Bonds then outstanding, (a) create and issue further bonds of the same series, which in all
respects (or in all respects except for the payment of interest accruing prior to the issue date of such further bonds
or except for the first payment of interest following the issue date of such further bonds) will be the same as the
Bonds, shall be consolidated and form a single series with the Bonds and shall have the same terms as to status,
security interest or otherwise as the Bonds; (b) issue bonds of a "Specified Asset Series", in which case the
proceeds of such issuance will not be subject to the Security Interest, and the bonds of such series will not have
the benefit of the Security Interest; and (c) create and issue bonds of one or more series under a bond trust
indenture other than the Base Indenture, which will have the benefit of a security interest ranking pari passu with
the Security Interest. Any bonds of a new series under the Base Indenture shall be issued subject to an indenture
supplemental to the Base Indenture.
Governing Law
The Bonds, the CMHC Guarantee and the Bond Indenture shall be governed by, and construed in
accordance with, the laws of the Province of Ontario, Canada and the laws of Canada applicable therein. The
Ontario Superior Court of Justice has non-exclusive jurisdiction in any proceedings arising out of or relating to
obligations under the Bonds.
USE OF PROCEEDS
The net proceeds of the Bonds, approximately C$2,488,000,000 after payment of the underwriters'
commissions and reimbursement of certain expenses, will be used to provide funds for the acquisition by the
Issuer of mortgage-backed securities guaranteed under the National Housing Act (Canada), as amended (the
"NHA").
CANADA HOUSING TRUSTTM NO. 1
The Issuer is a trust settled by CIBC Mellon Trust Company under the laws of the Province of Ontario,
Canada. The Issuer's main purpose is to raise funds by way of the issuance of bonds and to use the proceeds of
such issues to acquire ownership interests in housing loans (as defined in the NHA) including mortgage-backed
securities evidencing undivided ownership interests in such housing loans. As the Issuer is a trust and not a share
capital corporation it has no share capital.
CANADA MORTGAGE AND HOUSING CORPORATION
Status as Crown Agent
CMHC is an agent of Her Majesty in right of Canada by virtue of the Canada Mortgage and Housing
Corporation Act (the "CMHC Act") and is a Crown corporation wholly owned by Canada established in 1946.
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