Library Univ.ef m. IJtiifAlfV ■nc, CANADA STEAMSHIP LINES, LIMITED , to MONTREAL TRUST COMPANY, Trustee ^irst flDortgagc Collateral Crust Deeb Dated May 1, 1922 $6,000,000 Twenty Year First Mortgage Collateral Sinking Fund Seven Per Cent. Gold Bonds Digitized by the Internet Archive in 2017 with funding from University of Illinois Urbana-Champaign Alternates https://archive.org/details/canadasteamshipl00cana_0 (Ibis Unbenture made as of the first day of May,rartio8. 1922, by and between Canada Steamship Lines, Limited, a corporation incorporated under the laws of the Do- minion of Canada, having its principal office in the City of Montreal, (herein called “Company”), party of the first part, and Montreal Trust Company, a company incor- porated by special act of the Legislature of the Province of Quebec, Dominion of Canada, and authorized to carry on business throughout said Dominion under the Provin- cial Statutes of the respective Provinces of said Domin- ion, having its principal office in the City of Montreal, (herein called “Trustee”), party of the second part, WiTNESSETH : Whereas, the Company was duly incorporated under the name of “Canada Transportation Lines, Limited”, by Letters-Patent issued under Chapter 79 of the Revised Statutes of the Dominion of Canada (1906) knovui as “The Companies Act”, whicli name was duly changed to the Company’s present name by Supplemental Letters- ^ Patent dated October 7, 1913 ; and ; Whereas, the directors of the Company are by virtue of said “The Companies Act” amongst other things em- ) powered if authorized thereto by a By-Law sanctioned i by a vote of not less than two4hirds in value of the S subscribed stock of the Company represented at a gen- ; eral meeting duly called and held for considering the ‘ By-Law to borrow money upon the credit of the Com- ^ pany and to cause the Company to create, issue and sell its bonds from time to time for moneys so borrowed and to secure the same by mortgage, pledge or trust deed in the form hereof upon its property hereinafter de- V scribed; and Whereas, at a meeting of the Directors of the Com- paiiy duly called and held on April 24, 1922, a By-Law known as By-Law “F” of the Company was duly enacted authorizing the Directors to create and issue at such time or times as they consider advisable Twenty Year First Mortgage Collateral Sinking Fund Seven Per Cent Gold Bonds or bonds of such other designation and descrip- tion as the Directors may approve for an aggregate amount not exceeding $6,000,000. par value, pay- able both as to capital and interest and in whole or in part as the Directors may consider advisable either in Canadian currency or gold, or United States currency or gold, or in both, and to secure same by mortgage, pledge, hypothecation, lien and or transfer of or upon an amount not to exceed $8,400,000. par value of the Company’s First Mortgage 5% Debenture Stock (herein called “De- benture Stock”) and/or First Mortgage 5% Bonds, (herein called 5% Bonds) and if the Directors consider advisable of and upon such other assets of the Com- pany as the Directors may consider proper and to sell and dispose of the bonds so created and issued either in whole or in part, at such times and upon such terms and condi- tions as the Directors may consider proper, and to pledge or hypothecate same, or any part thereof, likewise at such times and upon such terms and conditions as the Direc- tors may consider proper, and upon the release of such bonds to repledge same or dispose of same and otherwise deal with same as fully as if same had not been already is- sued, and in connection therewith to enter into a trust, deed or deeds with such trustee or trustees as may be chosen for such purpose, said trust deed or deeds to contain such provisions with reference to redemption, sinking fund, release of security pledged and other 3 matters and such terms and conditions generally as the Directors may likewise consider proper as also to execute such pledges, liens, hypothecations and/or transfers of and upon such Debenture Stock and/or 5 % Bonds, or any part thereof, and of and upon such other assets and execute generally such other documents and instru- ments as may be considered proper in connection with the creation and issue of said bonds and the securing of same in accordance with the terms of said By-Law and of the trust deed or deeds to he entered into, as aforesaid, and generally to do all such matters and things and to authorize the execution of all such deeds and documents as the Directors in their discretion may deem necessary or advisable for the purpose of carrying out and giving effect to the said By-Law “F”; and Whereas, said By-Law “F” was duly sanctioned and confirmed by a vote of not less than two-thirds in value of the subscribed stock of the Company represented at a general meeting of the shareholders of the Company duly called for considering the same by notice specify- ing the terms of the By-Law as provided by the By- Laws of the Company and the statute in that behalf and held on May 16, 1922; and Whereas, at a meeting of the Directors of the Com- pany duly called and held on May 16, 1922, it Was resolved that under and by virtue of the authority conferred upon the directors by said By-Law “F”, the Company do forthwith create, issue and sell its bonds to be known as its Twenty Year First Mortgage Collateral Sinking Fund Seven Per Cent. Gold Bonds (herein called “Bonds”) in the aggregate principal amount of $6,000,000, to be issued in the denominations 4 of $1,000, $500 and $100, in coupon form, registerable as to principal, to be dated as of May 1, 1922, to be pay- able May 1, 1942, to bear interest from May 1, 1922 at the rate of 7% per annum, payable semi-annually on May 1 and November 1 in each year, to be payable as to both principal and interest in gold coin of or equal to the standard of weight and fineness existing on May 1, 1922, without deduction for any normal Federal income tax not exceeding 2% in any year and without deduction for any tax of the Dominion of Canada or any province, subdivision or other taxing authority thereof or therein; that the Company upon api)lication reimburse any Bond- holder for any Pennsylvania and Connecticut personal property taxes not exceeding four mills per annum on each dollar of principal amount of Bonds held by him which may be legally assessed upon such Bonds or upon such holder by reason of his ovmership thereof and paid by him; that the Bonds be redeemable in whole at the option of the Company (and in whole or in part but only for the Sinking Fund) on any semi-annual interest pay- ment date on at least sixty days prior notice to and including May 1, 1925, at 107^2% of the principal amount thereof together with accrued interest, and thereafter at 105% of the principal amount thereof together with accrued interest; that the Bonds have the benefit of a semi-annual Sinking Fund in the sum of $60,000 com- mencing May 1, 1923, and payable semi-annually there- after on May 1 and November 1 in each year to be ap- plied to the purchase of Bonds in the open market up to the current redemption price and if Bonds are not so pur- chasable to be applied to the redemption of Bonds; that an indenture, mortgage or trust deed be entered into be- tween the Company and Montreal Trust Company, as 5 Trustee, in the form liereof, to secure the Bonds by mort- gage, pledge, hypothecation, assignment and transfer of or upon the property hereinafter described ; and that the proper officers of the Company do all things expedient or proper to cany out such resolution; and Whereas, the Bonds and interest coupons to be at- tached thereto and the Trustee’s certificate to be en- dorsed thereon are to be in substantially the follo^nng forms, with appropriate insertions, omissions and vari- ations as in this Indenture provided : [form of bond] Form of No. $ ®“'‘' Dominion of Canada Province of Quebec Canada Steamship Lines, Limited Twenty Year First Mortgage Collateral Sinking Fund Seven Per Cent. Gold Bond Canada Steamship Lines, Limited, a corporation in- corporated under the Companies Act of the Dominion of Canada, (herein called “Company”), for value received, promises to pay to the bearer, or, if registered, to the registered ovmer hereof, on May 1, 1942, at the principal office of Bank of Montreal, or its successor, in the City of Montreal in the Dominion of Canada, or, at the. option of the bearer or such oAvner hereof, at the principal office of Bank of Montreal, or its successor, in the City of Toronto in said Dominion, or at the principal office of the Agency of Bank of Montreal, or its successor, in the Borough of Manhattan, in the City and State of New York, United States of America, dollars, and to pay interest thereon from May 1, 1922, at the rate of seven per cent, per annum. 6 semi-annually, on May 1 and on November 1, in each year, at any (at the option of the bearer or such owner hereof) of said offices, but only in accordance with the terms and on presentation and surrender of the coupons hereto attached as they severally mature. AU pajmients upon this Bond, both of principal and interest, made in the Dominion of Canada shall be in gold coin of said Dominion of or equal to the standard of weight and fineness existing as at May 1, 1922, and all such payments made in the United States of America shall be in gold coin of the United States of America of or equal to the standard of weight and fineness existing as at May 1, 1922; and all such pay- ments shall be made without deduction for any normal Federal income tax not in excess of two per cent, in any year under any present or future law of the United States of America, and without deduction for any tax, assess- ment or governmental charge under any present or future law of the Dominion of Canada or any province, subdivi- sion or taxing authority thereof or therein, which the Company, or the Trustee hereinafter mentioned, may be required to pay thereon or to deduct or retain therefrom. This bond is one of a duly authorized issue of Bonds of the Company knovm as its Twenty Year First Mort- gage Collateral Sinking Fund Seven Per Cent. Gold Bonds (herein called “Bonds”), limited to an aggregate principal amount of $6,000,000, all of which are issued under and equally and ratably secured by the First Mort- gage Collateral Trust Deed, dated as of May 1, 1922, (herein called “Indenture”), made and executed by the Company to Montreal Trust Company, (of Montreal, Canada), as Trustee, (herein called “Trustee”). For a description of the property thereby mortgaged, pledged I and assigned, the nature and extent of the security, and a statement of the rights of the bearer or such owner hereof and the terms and conditions on which this Bond is issued, reference is hereby made to the Indenture, to all the terms and provisions of which the bearer or such owner hereof assents by the acceptance hereof. As provided in the Indenture, the Company will reim- burse to the bearer or such owner hereof any Connecticut and Pennsylvania personal property tax not exceeding four mills per annum on each dollar of the principal amount hereof, which may be legally assessed upon this Bond, or upon the bearer or such owner hereof by reason of his ownership hereof and paid by him, if application therefor be made by him within sixty days after pay- ment of such tax. The Company will, on or before May 1, 1923, and there- after semi-annually on or before each May 1 and No- vember 1, in each year, pay to the Trustee, as provided in the Indenture, as and for a Sinking Fund the sirm of $60,000. In the event the Trustee shall cause to be pur- chased, as provided in the Indenture, any of the prop- erty mortgaged, pledged and assigiied under the Inden- ture, the proceeds of such purchase shall be held by the Trustee as and for the Sinking Fund, as provided in the Indenture, in addition to the semi-annual Sinking Fund payment above mentioned. Such Sinking Fund shall be held and applied, as in the Indenture pro- vided, to the purchase of Bonds, if obtainable, at prices up to but not exceeding the price then current for the redemption of the Bonds, as pro- vided in the Indenture, but if Bonds are not so obtainable any accumulations in the Sinking Fund shall be applied 8 to the redemption of Bonds as provided in the Indenture. The Bonds of this issue at the time outstanding are sub- ject to redemption in whole, at the option of the Company, and in whole or in part for the Sinking Fund herein men- tioned, on any semi-annual interest payment date, on at least sixty days prior notice given by publication in said Cities of Montreal and Toronto and in said Borough of Manhattan, City of New York, in the manner pro- vided in the Indenture, to and including May 1, 1925 at 1011 / 2 % of the principal amount thereof together with accrued interest, and thereafter at 105% of the principal amount thereof together with accrued interest. Bonds purchased or redeemed shall be cancelled and not reis- sued. This Bond shall pass by delivery, unless registered, upon payment of charges, in the owner’s name on the books of the Company at the principal office of Montreal Trust Company, or its successor, in the City of Montreal in the Dominion of Canada, or at the principal office of Montreal Trust Company, or its successor, in the City of Toronto in said Dominion, or at the principal office of the Agency of The Royal Bank of Canada, or its successor, in the Borough of Man- hattan, in the City and State of New York, United States of America, such registration being noted hereon. After such registration, no transfer shall be valid unless made, at one of said offices at which this Bond is ex- pressed to be registerable, by the registered ovmer, in person or by attorney duly authorized, and similarly noted hereon; but this Bond may be discharged from registration by being in like manner transferred to bearer and thereupon transferability by delivery shall be restored; and this Bond may again, from time to time, 9 be registered or transferred to bearer as before. Such registration shall not affect the negotiability of the cou- pons, which shall continue to be payable to the bearer thereof and transferable by delivery. As provided in the Indenture, coupon Bonds of the denomination of $1,000, $500 or $100, at any time out- standing, when surrendered with all unmatured coupons attached and upon the payment of charges, may be ex- changed for an equal aggregate principal amount of coupon Bonds of any other denomination of the same is- sue, of numbers not contemporaneously outstanding, with all unmatured coupons attached. In case an event of default as defined in the Inden- ture shall occur, the principal of all the Bonds may be- come, or be declared, due and payable in the manner and with the effect provided in the Indenture. No recourse shall be had for the payment of this Bond or the interest hereon against any stockholder, share- holder, director or officer of the Company, as such, either directly or through the Company, by virtue of any statute or the enforcement of any assessment or otherwise; such liability of stockholders, shareholders, directors or officers, as such, being released by the bearer or such owner hereof by the acceptance of this Bond and being also waived and released by the terms of the In- denture. This Bond shall not be entitled to any benefit under the Indenture or become valid or obligatory for any purpose until it shall have been authenticated by the certificate of the Trustee under the Indenture hereon endorsed. 10 Form of coupon. In Witness Whereof, Canada Steamship Lines, Limited has caused this Bond to be signed by its Presi- dent or a Vice President, and its corporate seal to be hereunto affixed and attested by its Secretary or an As- sistant Secretary, and the coupons for said interest authenticated by the facsimile signature of its Treas- urer to be attached hereto, aU in the City of Montreal, Dominion of Canada, as of the first day of May, 1922. Canada Steamship Lines, Limited By Attest : Vice President. Assistant Secretary. [form of coupon] No. $ On the day of , 19 , unless the Bond hereinafter mentioned shall have been called for previous redemption, Canada Steamship Lines, Limited will pay to bearer, at the principal office of Bank of Montreal, or its successor, in the City of Montreal, Canada, or, at the option of the bearer, at the principal office of Bank of Montreal, or its successor, in the City of Toronto, Canada, in gold coin of the Dominion of Canada, or at the principal office of the Agency of Bank of Montreal, or its successor, in the Borough of Manhattan, in the City and State of New York, in United States gold coin, on surrender of this coupon, 11 dollars, without deduction for any normal Federal income tax not in excess of two per cent, in any year and without deduction for any Canadian taxes, assessments or governmental charges, being six months interest then due on its Twenty Year First Mortgage Collateral Sinking Fund Seven Per Cent. Gold Bond, No. > Treasurer. [form of trustee's certificate] This is one of the Bonds described in the within men- Form of Trustee 's Certificate. tioned Indenture. Montreal Trust Company, Trustee, By for the Manager. Whereas, the Company has caused to bo deposited with the Trustee and hypothecated and pledged under this Indenture as security for the Bonds, $8,400,000 prin- cipal amount of 5% Bonds issued and secured under a Trust Deed dated October 8, 1913 (herein called “Trust Deed of 1913”) and made between the Company under its then name of Canada Transportation Lines, Limited, of the one part, and Prudential Trust Company, Limited. 12 of tlie other part, and under Trust Deed supplementary to the Trust Deed of 1913, made between the Company, of the first part, said Prudential Trust Company Limited, of the second part and Royal Exchange Assurance (of London), of the third part, dated February 11, 1914:, (herein called Supidemental Trust Deed of 1914”), and under a further Supplemental Trust Deed entered into between the Company and said Prudential Trust Com- pany Limited and Royal Exchange Assurance, dated Augmst 14, 1917 (herein called “ Supplemental Trust Deed of 1917”), and under a further supplemental Trust Deed entered into between the Company and said Prudential Trust Company Limited and Royal Exchange Assur- ance, dated August 30, 1921 (herein called “Supplemental Trust Deed of 1921”), which Trust Deed of 1913 and Supplemental Trust Deed of 1914 and Supple- mental Trust Deed of 1917 and Supplemental Trust Deed of 1921 are herein collectively referred to as “Trust Deed”, and which Prudential Trust Company, Limited and Royal Exchange Assurance are herein referred to as “Trustees under the Trust Deed”; and Whereas, the execution of the Bonds and of this In- denture has in all respects been duly authorized and all things necessary to make the Bonds, when signed and sealed by the Company and authenticated by the Trustee, the valid, binding and legal obligations of the Company, and to constitute this Indenture a valid, binding and legal mortgage and deed of trust and agreement for the security of the Bonds in accordance with its terms, have been done and performed and have happened ; Granting clause. Now, THEREFORE, THIS IXDENTtHlE WITNESSETH, that said Canada Steamship Lines, Limited, party of the first part, in consideration of the premises and in order to 13 secure the payment of the Bonds, and the interest there- on, according to the true intent and meaning thereof, and also for and in consideration of the sum of One Dollar 'to it in hand paid by the Trustee at or before the ensealing and delivery of these presents, the receipt whereof is hereby acknowledged, has piortgaged, hy- pothecated, pledged, assigned, transferred, and set over, and by these presents does mortgage, hypothecate, pledge, assign, transfer, and set over unto Montreal Trust Company, party of the second part, as Trustee, its successors and associates in the trust and its and their assigns, the following described property: $8,400,000 par or principal amount of the Company 5% Bonds issued and secured under the Trust Deed estate, (which 5 % Bonds are hereinafter sometimes called “trust estate”). I To HAVE AND TO HOLD, all of Said trust estate unto the Trustee, its successors and associates in the trust and its and their assigns forever; But in trust, nevertheless, under and subject to terms, covenants and conditions hereinafter set forth, for the equal and proportionate benefit and security of all present and future holders of the Bonds and interest coupons issued and to be issued under this Indenture, without preference, x^riority or distinction of any one Bond over any other Bond by reason of priority in the issue, sale or negotiation thereof, or otherwise, excejit as otherwise provided in Section 3 of Article IV and Section 1 of Article VI hereof. And it is Hereby Covenanted, Declared and Agreed, by and between the parties hereto, that all such Bonds, with the coupons for interest thereon, are to be issued. 14 authenticated, delivered and secured, and that the trust estate subject or to become subject hereto is to be held and applied subject to the further covenants and condi- tions, uses and trusts hereinafter set forth; and the Com- pany, for itself and its successors and assigns, does here- by covenant and agree to and with the Trustee, its suc- cessors and associates in the trust and its and their as- signs, for the benefit of the bearers, or, if registered, the registered owners, of the Bonds, and bearers of the inter- est coupons, or any of them, as follows : ARTICLE I. Form, Execution, Issue and Registration of Bonds, Amount of Bonds. Execution, authentica- tion, issue and delivery. Section 1. The amount of Bonds which may be exe- cuted by the Company and which may be authenticated by the Trustee is limited so that at no time shall there be issued hereunder Bonds for an aggregate principal amount exceeding $6,000,000. Forthwith upon the execution and delivery of this Li- denture the Company may execute and deliver to the Trustee $3,000,000 principal amount of Bonds, and with- out further corporate action on the part of the Company the Trustee shall authenticate said Bonds and deliver the same on the written order of any officer of the Company. All said Bonds may be executed by the Company and authenticated by the Trustee and delivered prior to the registration, recordation or filing of this Indenture or particulars in regard hereto. The Bonds may be issued to such persons and on such terms and either at par or at a discount or at a premium as the Company, or the Board of Directors on behalf of the Company, shall from time to time determine. Signatures Bection 2. The Bonds shall be signed in the name of of former officers. the Company by its president or a vice-president, and its 15 corporate seal may be thereto affixed and attested by its secretary or an assistant secretary. In case any one or more officers who shall have signed or sealed any of the Bonds shall cease to be such officer or officers before the Bonds so executed shall have been actually authenticated and delivered by the Trustee, such Bonds may, never- theless, upon the written order of any officer of the Company be authenticated and delivered, as herein provided, and may be issued as though the persons who signed or sealed such Bonds had not ceased to be such officers of the Company. The coupons to be attached to the Bonds shall be au- Fac-simiie thenticated by the fac-simile signature of the present or any future treasurer of the Company and the Company may adopt and use for that purpoise the fac-simile signa- ture of any person who shall have been treasurer of the Company, notwithstanding the fact that he may have ceased to be such treasurer at the time when such Bonds shall be actually authenticated and delivered. Only such of the Bonds as shall have endorsed thereon a certificate of authentication substantially in the form^^^®^ hereinbefore set forth, duly executed by the Trustee, shall be entitled to any lien or benefit hereunder. No Bond and no coupon thereunto appertaining shall be valid or obli- gatory for any purpose until such certificate of authenti- cation shall have been duly endorsed on such Bond; and such certificate of the Trustee upon any Bond executed in behalf of the Company shall be conclusive and the only evidence that the Bond so authenticated has been duly issued hereunder and that the holder is entitled to the benefit of the trust hereby created. Before authenticating or delivering any Bonds, the Matured coupons to be cancelled. 16 Denomina- tious of Bonds. Bonds cx- changeablo Trustee shall cut off, cancel and, upon its written request deliver to the Company, all coupons thereon then matured. Section 3. The Bonds shall he in the denominations of $1,000, $500 and $100, and shall be substantially in the form set out in the recitals to this Indenture. Bonds of the same denomination shall be identical in form. Uefinitive Bonds for $1,000 shall be numbered consecu- tively from M-1 upwards. Definitive Bonds for $500 shall be numbered consecutively from D-1 upwards. Definitive Bonds for $100 shall be numbered consecu- tively from C-1 upwards. Coupon Bonds issued under this Indenture of the de- fer other nomination of $1,000, $500 or $100, at any time outstand- ing, when surrendered at any of the places at which the Bonds are expressed to be registerable with all unmatured coupons attached and upon the payment of the charges mentioned below, may be exchanged for an equal aggre- gate principal amount of coupon Bonds of any other denomination or denominations of this issue, of numbers not contemporaneously outstanding, with all unmatured coupons attached. Every Bond shall have a legend endorsed thereon de- scriptive of such rights of exchange as aforesaid. In case at any time the registered owner of any registered Bond or Bonds shall surrender such Bond or Bonds for exchange for a Bond or Bonds of another denomination as aforesaid such registered own- er shall cause such registered Bond or Bonds to be trans- ferred to bearer prior to any such exchange. Every such exchange of Bonds of one denomination for Bonds of a different denomination or denominations as provided in this Section 3 shall be effected in such manner as may be prescribed by the Board of Directors, with the approval of the Tnistee, or as may be neces- 17 sary to comply with the rules or regulations of any stock exchange with which such Bonds are listed or to be listed or to conform to usage with respect thereto. In every case of exchange of Bonds under the provi- sions of this Section, the Trustee shall forthwitli cancel the surrendered Bond or Bonds and coupons and shall deliver the same to the Company upon its request. For any such exchange of Bonds the Company may make a charge sufficient to reimburse it for any stamp tax or governmental charge required to be paid; and in ad- dition may charge a sum not exceeding $1.00 for each Bond issued upon such exchange. Any Bond issued hereunder may hear such numbers, letters or other marks of identification or designation, and may be endorsed with such legends and recitals in respect to the Bond or Bonds as may be determined by the Board of Directors of the Company and approved by the Trustee and as may be required to comply with the rules and regulations of any stock exchange with which such Bonds are listed or are to be listed or to con- form to the usages with respect thereto, and as may be required by law or otherwise, and, similarly, provision may be made in connection with the Bonds for the reser- vation of the appropriate numbers or other designating marks of Bonds exchangeable in place of Bonds at any time outstanding as required by such stock exchange rules and regulations, and usage or otherwise. Section 4. The Bonds shall be negotiable and shall pass by delivery, unless registered as to principal in the manner hereinafter provided. The Company, at each of the places at which the Bonds are expressed to be regis- terable, will keep books for the registration, as to Identifica- tion marks and endorse- ments. Registration. 18 Registered owner. principal only, and for the transfer of the Bonds, as in this Indenture provided. Any Bond may be reg- istered in the owner’s name on said books as to princi- pal only, upon presentation thereof at any of said places at which the Bonds are expressed to he registerahle, and such registration shall he noted on the Bond. After such registration no transfer shall he valid unless made on said books at one of said places at which the Bonds are expressed to be registerahle, by the registered owner, in person or by his attorney duly authorized, and similarly noted on the Bond; but the Bond may be dis- charged from registration by being in like manner trans- ferred to bearer, and thereupon transferability by de- livery shall be restored; and such Bond may again and from time to time be registered or be transferred to bearer as before. Registration of any Bond as to principal shall not, however, atfect the negotiability of the coupons apper- taining to such Bond, but every such coupon shall con- tinue to be payable to the bearer of such coupon and transferable by delivery merely. For any such transfer or registration of a Bond the Company may require the pajonent of a sum sufficient to reimburse it for any stamp tax or other governmental charge that may be imposed thereon and in addition may charge a sum not exceeding $0.50 for each Bond so trans- ferred or registered. Section 5. As to any Bond registered as to principal, the person in whose name the same shall be registered shall for all purposes be deemed and regarded as the ab- solute ovmer thereof, and payment of or on account of the principal of any such Bond shall be made only to or upon the order of the registered owner thereof, but such regis- tration may be changed, as hereinbefore provided. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of 19 the sum or sums so paid. The Company and the Trustee may deem and treat the bearer of any Bond which shall not at the time be registered as to principal, and the bearer of any coupon for interest on any Bond, whether such Bond shall be registered as to principal or not, as the absolute owner of such Bond or coupon, as the case may be, whether such Bond or coupon shall be overdue or not, for the purpose of receiving payment thereof, and for all other purposes whatsoever, and neither the Com- pany nor the Trustee shall be affected by any notice to the contrary. Section G. In case any Bond with the coupons there- Mutilated, to appertaining, shall become mutilated or be destroyed destroyed or „ • ■ j T j • • 1 Bonds or lost, the Company may m its discretion issue, and the and coupons. Trustee may thereafter in its discretion authenticate and deliver upon the written order of any two officers of the Company, a new Bond of like tenor and date (includ- ing coupons) in exchange and substitution for the Bond or Bonds and coupons mutilated, upon cancellation there- of, or in lieu of and in exchange and substitution for the Bond or Bonds and coupons destroyed or lost, upon the owner filing with the Trustee evidence satisfactory to it that such Bond or Bonds and coupons were destroyed or lost, and of his ownership thereof, and furnishing the Company and the Trustee with indemnity satisfac- tory to them. Section 7. Until definitive Bonds can be prepared, Temporary the Company may execute, and the Trustee.shall authenti-^”^*^^’ cate and deliver upon the written order of any officer of the Company, in lieu of definitive Bonds, but subject to the same provisions, limitations and conditions, except as to the denominations thereof, one or more tern- 20 Temporary Bonds ex- changeable between de- nominations. porary typewritten, printed or lithographed Bonds of the denomination of $100 or any multiple thereof, substantially of the tenor hereinbefore recited, and with one or more or without coupons, and with appropriate omissions, insertions and variations as may be required. When definitive Bonds are pre- pared and ready for delivery, upon surrender of such temporary Bonds for exchange, at any of the places at which the Bonds are expressed to beregisterable, the Company at its own expense shall prepare and ex- ecute and, upon cancellation of such surrendered tem- porary Bonds, the Trustee shall authenticate and deliver in exchange therefor, without further authorization from the Company, definitive Bonds 'for the same aggregate principal amount as the temporary Bonds surrendered. Until exchanged for definitive Bonds the temporary Bonds shall in all respects be entitled to the same lien and security of this Indenture as the definitive Bonds to be issued and authenticated hereunder. If the tem- porary Bonds shall be issued without coupons or mth- out all coupons appertaining to the Bonds, interest, when and as payable and for which no coupon shall have been issued with such temporary Bonds, shall be paid upon presentation thereof and notation of such pajunent shall be endorsed thereon. In case at any time the registered owner of any registered temporary Bond or Bonds shall surrender such Bond or Bonds for exchange for a defini- tive Bond or Bonds as aforesaid such registered owner shall cause such registered Bond or Bonds to be trans- ferred to bearer prior to any such exchange. Section 8. The holder of any temporary Bond or Bonds, not at the time registered as to principal, or the 21 holder of any temporary Bond or Bonds registered as to principal providing he shall cause the same to be transferred to bearer prior to the exchange mentioned below, may, at his option, surrender the same, with all then unmatured coupons, if any, appertaining thereto, at any of the places at which the Bonds are expressed to he registerable, for exchange for other temporary Bonds of like aggregate principal amount and thereupon the Com- pany will issue and the Trustee shall authenticate, and, in exchange for the temporary Bond or Bonds with said coupons, if any, so surrendered, shall deliver, without further authorization from the Company, a like aggre- gate principal amount of temporary Bonds in any de- nomination or denominations provided for in this Inden- ture and requested by such holder, with all then unma- tured coupons attached thereto to such extent as tem- porary Bonds are then being issued hereunder with cou- pons. Every such temporary Bond surrendered in ex- change either for other temporary Bonds or for defini- tive Bonds, shall be forthwith cancelled by the Trustee and delivered to the Company upon the Company’s re- quest. ARTICLE II. Sinking Fund. Section 1. The Company will create and maintain a Semi annual Sinking Fund to be applied, as hereinafter provided, to sinking* the purchase and/or redemption of the Bonds, and for^'^°'^' that purpose the Company covenants and agrees that it will on or before May 1, 1923, and thereafter on or be- fore each May 1 and November 1, in each year, pay to the Trustee as and for the Sinking Fund, until all the Bonds 22 principal and interest shall be paid, the sum of $60,000, to be applied by the Trustee to the purchase and/or re- demption of Bonds as hereinafter provided. The Sink- ing Fund payments herein required are to he cumulative, and arrears shall be made up by the Company on suc- ceeding Sinldng Fund payment dates before any divi- dend shall be declared or paid on the shares of capital stock of the Company either preferred or common, other than stock dividends. Application of Sinking Fund. Purchase in open market. or for re- demption of Bonds. Section 2. The moneys paid to the Trustee as pro- vided in Section 1 of this Article II and/or any other moneys in the Sinking Fund shall be held by the Trustee and applied by it in the following manner: (a) Immediately upon the receipt of the moneys so paid, or from time to time whenever there shall be moneys in the Sinking Fund available therefor, the Trustee may, and at the request in writing of the Com- pany signed by any two officers thereof shall, pur- chase for the Sinking Fund in the open market or at private sale or upon any exchange or broker’s board as many of the Bonds issued under this Inden- ture as are obtainable and as can be acquired with the moneys in the Sinking Fund at prices up to and includ- ing but not exceeding the then current redemption price of the Bonds as provided in Section 1 of Article III hereof. (b) If, prior to August 25 following any May 1 semi- annual Sinking Fund payment or prior to February 25 following any November 1 semi-annual Sinking Fund payment, there shall not have been purchased pursuant to the provisions of subdivision (a) of this Section, a sufficient amount of Bonds to exhaust all of the 23 moneys in the Sinking Fund, the Trustee forth- with shall, in the name of and for and on behalf of the Company and at the price, in the manner, with the ef- fect and subject to the provisions of Article III hereof, apply any moneys in the Sinking Fund, not required to pay the purchase price of any Bonds theretofore purchased, to the redemption of Bond^ on the next succeeding interest payment date. Any bal- ance left over on account of being insufficient to redeem one Bond shall be held by the Trustee and applied by it together with any Sinking Fund payments later received. Section 3. So long as any of the 5 % Bonds and/or Additional Debenture Stock shall be held by the Trustee hereunder as and for the trust estate, and unless and until some pur°]|fgg one or more of the events of default specified in Section ostate. 2 of Article VI hereof shall have happened and be sub- sisting, and in the event the Company shall at any time and from time to time notify in writing the Trustee that there are moneys on deiiosit with the Trustees under the Trust Deed as and for a sinking fund applicable to the purchase of 5% Bonds and/or Debenture Stock as provided in the Trust Deed and stating in such notice the approximate amount so on deposit, the Trustee shall forthwith offer any or all of the 5% Bonds and/or De- benture Stock then comprising the trust estate hereun- der for purchase by the Trustees under the Trust Deed out of the moneys in the sinking fund under the Trust Deed at the price of at least 100% of the principal or par amount of the 5% Bonds and/or Debenture Stock so of- fered and in an amount sufficient to substantially exhaust the moneys so stated to be deposited with the Trustees un- der the Trust Deed, and in the event such offer of the 24 Trustee is accepted in whole or in part by the Trustees under the Trust Deed, the Trustee shall surrender to the Trustees under the Trust Deed the 5% Bonds and/or De- benture Stock so purchased upon the receipt of the pur- chase price therefor, and such purchase price so received shall be held and applied by the Trustee as and for the Sinking Fund under this Indenture in the same manner as the payments required to be made pursuant to Section 1 of this Article, in addition to the Sinking Fund pay- ments required to be made pursuant to said Section 1, and nothing contained herein shall he deemed to relieve the Company of its obligations to make the Sinking Fund payments provided for in said Section 1. Bonds pur- chased or re- deemed to be cancelled. Section 4. All Bonds, with all unmatured coupons ap- pertaining thereto, purchased or redeemed by the appli- cation of moneys in the Sinking Fund shall be cancelled by the Trustee, and delivered to the Company upon its request, and no Bonds shall be issued in lieu thereof. ARTICLE III. Redemption of Bonds. Bonds re- SECTION 1. The Boiids secured by this Indenture and whole or for at any time outstanding shall be subject to redemption, Fund.'^ as provided in Articles II and III hereof, on any semi- annual interest payment date, on at least sixty days prior notice by publication as provided in Section 2 of this Article, to and including May 1, 1925 at 107^2% of the principal amount thereof together with accrued' inter- est, and thereafter (that is to say, after May 1, 1925) at 105% of the principal amount thereof together with accrued interest, as follows : (a) The whole amount of the Bonds at any 25 time outstanding shall ho subject to redemption at the option of' the Company. (b) In case, ait any time and from time to time, there shall be moneys in the Sinking Fund pro- vided for in Article II hereof applicable to the redemption of Bonds as provided in subdivision (6) of Section 2 of said Article II, then in such case, (1) if such moneys are sufficient to redeem, at the then current redemption price above men- tioned, the whole amount of Bonds then outstand- ing, the Trustee shall call for redemption the whole amount of Bonds then outstanding, or (2) if such moneys are sufficient to redeem, at the then current redemption price above mentioned, a part only of the amount of Bonds then outstanding, (but sufficient to so redeem at least one Bond of the smallest denomination then outstanding), the Trustee shall designate for redemption, by lot in such manner as it shall determine, a part of the amount of Bonds then outstanding sufficient at the then current redemption price to exhaust all such moneys in the Sinking Fund (but shall not include any fraction of any Bond), and the Trus- tee shall call such part of the Bonds for redemp- tion. The redemption price of Bonds presented for redemp- tion in the Dominion of Canada as hereinafter provided, shall be paid in gold coin of said Dominion of or equal to the standard of weight and fineness existing as at May 1, 1922. The redemption price of Bonds presented 26 for redemption in the United States of America as here- inafter provided, shall be paid in gold coin of the United States of America of or equal to the standard of weight and fineness existing as at May 1, 1922. rubiication SECTION 2. In case the Company elects to exercise redemption, its option to redeem the Bonds as pro\dded in subdivi- sion (a) of Section 1 of this Article the Company shall, or in case there shall be moneys in the Sinking Fund on any February 25 or August 25 in any year applicable to the redemption of Bonds as provided in subdivision (h) of Section 2 of Article II the Trustee shall, at the expense of the Company, give at least sixty days notice thereof by publication in one daily newspaper of general circu- lation published in the Borough of Manhattan, in the City and State of New York, and in one daily newspaper of general circulation published in the City of Montreal, Canada, and in one daily newspaper of general circula- tion published in llie City nf Toronto, Canada, at least once in each calendar week of the sixty days next preced- ing such redemption date (in each instance on any day of the week, but the first publication shall be at least sixty days prior to and exclusive of the redemption date) stating such election on the part of the Company or that Bonds are to be redeemed by application of moneys in the Sinking Fund, as the case may be, specifying in the case of such redemption for the Sinking Fund the numbers of the Bonds to bo redeemed (which numbers, in case of redemption of a part of the Bonds outstand- ing, shall have been designated by lot by the Trustee pre- viously to the publication of such notice and in such man- 27 ner as it may determine), and further stating that on such date there will become and be due and payable upon each of the Bonds so to be redeemed, at any of the places at which the same are expressed to be payable, the amount at which Bonds are then redeemable in accordance with Section 1 of this Article, and that from and after such date interest thereon will cease to accrue. The Company or the Trus- Notice by mail to rcg- tee, as the case may be, causing such publication, shall istered owners. also cause a similar notice to be mailed, first class post- age prepaid, at least sixty days prior to such redemp- tion date, to each registered owner of Bonds so called for redemption whose address appears on the transfer register, but such mailing shall not be a condition prece- dent to such redemption, and failure so to mail any such notice shall not atfect the validity of the proceedings for the redemption of the Bonds. Section 3. Notice of redemption having been given by Payment of publication as provided in Section 2 of this Article, the Redemption. Bonds so designated for redemption shall on the date designated in such notice become due and payable at the redemption price; and on presentation of the Bonds in accordance with such notice at any of the places at which the same are expressed to be payable, with all appurte- nant coupons maturing after said redemption date, the Bonds shall be paid at the redemption price. Such pay- ment of the sum payable for the principal on each Bond and the premium upon redemption, shall be made to the bearer of such Bond unless it shall then be registered, in which case such payment shall be made to the registered owner, but in either case only upon the surrender of such 28 Cancellation upon de- posit of moneys to redeem all Bonds. Bond with all appurtenant coupons, if any, maturing after said redemption date. All unpaid interest instalments rep- resented by coupons which shall have matured on or prior to the date of redemption specified in such notice shall continue to he payable to the bearers severally and re- spectively. From and after the date of redemption so designated, unless default shall be made in the redemp- tion of the Bonds so designated for redemption, interest on the Bonds so designated for redemption shall cease and all coupons for interest appertaining to any of such Bonds and maturing after such date shall become and be null and void. If not so paid on presentation there- of the Bonds so designated for redemption shall con- tinue to bear interest at the rate of seven per cent, per annum until paid. Section 4. Upon payment to or deposit with the Trus- tee as and for the Sinking Fund or otherwise of the amount in money necessary to redeem as provided in this Article all outstanding Bonds, including the premiums as aforesaid mnd the unpaid interest accrued to the date of redemption, together with proof that notice or notices of redemption of all of the outstanding Bonds have been given by publica- tion as hereinbefore provided or that arrangements have been made insuring to the satisfaction of the Trustee that such notice or notices by publication will be so given, and on pajunent to the Trustee of all its costs, charges and expenses in relation thereto or other- wise under this Indenture, the Trustee shall cancel and satisfy this Indenture and cause the same, at the ex- pense of the Company, to be released and discharged 29 of record, and shall assign, transfer and deliver to the Company or upon its order, all of the property herel3y mortgaged, hypothecated, pledged, assigned or deposited with the Trustee under the provisions hereof, other than the moneys deposited with the Trustee first above men- tioned in this Section 4. The Trustee subject to the pro- visions of Section G hereof shall apply the money so de- posited with it to the redemption of the Bonds as pro- vided in this Article III, including the premiums as aforesaid and the unpaid interest accrued to the date of redemption, except that moneys so deposited as and for the Sinking Fund shall be applied in the manner pro- vided for the application of moneys in the Sinking Fund under Articles II and III hereof. Section 5. Upon surrender to the Trustee of the en- Canceiia- ^ tion upon tire issue of Bonds outstanding, and on payment to the surrender of Trustee of all its costs, charges and expenses in relation ing Bonds, thereto or otherwise under this Indenture, the Trustee shall cancel and satisfy this Indenture and cause the same, at the expense of the Company, to be released and discharged of record, and shall assign, transfer and de- liver to the Company, or upon its order, all of the prop- erty hereby mortgaged, hypothecated, pledged, assigned or deposited with the Trustee under the provisions hereof. Section 6 . In case the holder of any Bond and/or Trustee to coupon shall not within six years after the date fixed depo^ted^' as aforesaid for the redemption of such Bond and coupons, if any, appertaining thereto demand pay- ment of the amount so deposited for the payment there- of and surrender such Bond and coupons, if any, the 30 Trustee shall, upon demand of the Company, pay over the amount so deposited for the payment thereof to the Company and all liability of the Trustee with reference to such money shall thereupon cease. Kedeemed bonds to be cancelled. Section 7. All Bonds, with all unmatured coupons appertaining thereto, as and when redeemed and paid shall be cancelled by the Trustee, and delivered to the Company upon its request, and no Bonds shall be is- sued in lieu thereof. Section 8. The Company shall, any provisions herein to the contrary notwithstanding, have the right to pur- chase, sell or otherwise deal in Bonds, including the right to offer the same for purchase to the Sinking Fund as provided in Article II hereof. ARTICLE IV. Pakticulab Covenants by the Company. The Company covenants and agrees as follows: Company to SECTION 1. That the Company will duly and punctually pal and in- pay or cause to be paid, the principal and interest of torest with- ^ ’ i > ^ out dedue- everv Bond, at the dates and places and in the manner tion. mentioned in the Bond or in the coupons thereto attached, according to the true intent and meaning thereof, tvithout deduction for any normal Federal income tax not in ex- cess of two per cent in any year under any present or future law of the United States of America, and without deduction for any tax, assessment or gov- ernmental charge under any present or future law of the Dominion of Canada or any Province, sub- 31 division or other taxing authority thereof or there- in, which the Company (directly, or any office or agency of the Company, including Bank of Montreal, or its suc- cessor, in the City of Montreal, Dominion of Canada, and including Bank of Montreal, or its successor, in the City of Toronto, in said Dominion, and including the Agency of Bank of Montreal, or its successor, in the Borough of Manhattan, City and State of New York, United States of America) or the Trustee may he required to pay thereon, or to deduct or retain therefrom ; and that the Company will pay each and every such tax, assessment or governmental charge and in- demnify and save harmless the Trustee and any such office or agency of the Company in respect of any such tax, assessment or governmental charge for which the Trustee or any such office or agency of the Company may become liable. The interest on the Bonds shall be interest pay- payable only upon presentation and surrender of thesu^Lnder of several coupons for such interest as they respectively mature, and such coupons shall be cancelled forthwith upon the payment thereof, and thereupon delivered to the Company at its request. Section 2. That upon written application addressed Company to to the Company at any of the places at which the Bonds LoidOT "^for are expressed to be payable, the Company will also re- tiJut a°X^° imburse at any of said places to any holder or registered va^^^prop- owner of Bonds any Connecticut and Pennsylvania per-^*”^^ sonal property tax, under any present or future law of Connecticut or Pennsylvania, not exceeding four mills per annum on each dollar of the principal amount of Bonds held by him, which may be legally assessed upon such Bonds or upon such holder or registered owner by reason 32 of his ownership thereof, and paid by liim; provided that such application shall be made to the Company at any of said places at which the Bonds are expressed to he pay- able within sixty days after payment of such tax and in any event not later than nine months after such tax shall have become due and payable, and that such applica- tion shall set forth the ownership by the applicant of Bonds, together with the number or numbers thereof, the residence of the applicant at the time said tax was assess- ed against him and that such tax was assessed upon and paid by him because of the ownership by him of such Bonds, and such further facts with respect to the legal liability of such holder to pay such tax as the Company may reasonably require, and provided further that the Company shall not theretofore have paid to the State of Connecticut or to the Commonwealth of Pennsylvania the amount of such tax applicable to such Bonds. The Company shall in no event be liable to reimburse such holder for any interest or penalty assessed upon or paid by him in addition to the amount of such tax or taxes originally assessed. Company SECTION 3. That in order to prevent anv accumulation not to ex- tend time of coupons after maturity, the Company will not, directly for payment i • r. of coupons, or indirectly, extend or assent to the extension of the time for payment of any coupon appertaining to any Bond, and the Company will not, directly or indirectly, be a party to or approve any such extension by purchas- ing or funding said coupons, or in any other manner. In case the time for the payment of any such coupons shall be so extended, whether or not such extension be by or with the consent of the Company, such coupons shall not he entitled, in case of default hereunder, to 33 the benefit of the security of this Indenture, except sub- ject to the prior payment in full of the principal of all the Bonds then outstanding, and of all coupons apper- taining to such Bonds, the payment of which shall not have been so extended, with interest at the rate of seven per cent, per annum. Section 4. That at all times until the payment of the^i^^p^^y principal of the Bonds, the Company will maintain office or agency in the City of Montreal, in the Dominion , of Canada, and an office or agency in the City of Toronto, New York, in said Dominion, and an office or agency in the Bor- ough of Manhattan, in the City and State of New York, where the Bonds and coupons may be presented for payment and reimbursement for taxes obtained, as by their terms and the terms of this Indenture provided, and an office or agency in each of said Cities, subject to the approval of the Trustee, where Bonds may be pre- sented for registration, transfer and exchange and so reg- istered, transferred and exchanged as by their terms and the terms of this Indenture provided, and where notices and demands in respect of the Bonds and coupons or of this Indenture may be served. That from time to time the Company will give notice to the Trustee of the loca- tion of any such office or offices or agency or agencies or of any change of location thereof. That until the Trustee shall receive notice of a change as aforesaid or in case the Company shall fail to maintain any such office or offices or agency or agencies or shall fail to give notice of tlie loca- tion thereof or of any change of location thereof, where the Bonds and coupons may be presented for payment and reimbursement for taxes obtained, as by their terms 34 and the terms of this Indenture provided, such payment or reimbursement may be had either at the principal office of Bank of Montreal, or its successor, in the City of Montreal, in the Dominion of Canada, or at the prin- cipal office of Bank of Montreal, or its successor, in the City of Toronto in said Dominion, or at the principal office of the Agency of Bank of Montreal, or its succes- sor, in the Borough of Manhattan, City and State of New York, United States of America. That until the Trustee shall receive notice of a change as aforesaid or in case the Company shall fail to maintain any such office or offices or agency or agencies or shall fail to give notice of the location thereof or of any change of location thereof, where presentation and demand may he made, and such registration, transfer and exchange may be had, and notices may be served, such presentation and demand may be made, and such registration, transfer and ex- change may be had and notice may be served either at the principal office of Montreal Trust Company, or its successor, in the City of Montreal, in the Dominion of Canada, or at the principal office of Montreal Trust Company, or its successor, in the City of Toronto, in said Dominion, or at the principal office of the Agency of The Royal Bank of Canada, or its successor, in the Borough of Manhattan, in the City and State of New York, United States of America. But the Trustee and said offices and agencies, and their successor or succes- sors, shall be under no liability to the Company or to any Bondholder or to any other corporation or person in respect thereof. Covenant SECTION 5. That the Company is duly authorized under v^*b^v^ithe laws of the Dominion of Canada and all other appli- 35 cable provisions of law to create and issue the Bonds and to execute this Indenture and to mortgage, hypothe- cate, pledge, transfer and assign the trust estate here- under, and that all corporate action on its part for the creation and issue of the Bonds and the execution of this Indenture has been duly and effectively taken and that the Bonds in the hands of holders thereof are and will he valid and enforcihle obligations of the Company in accordance with their terms. Section 6. That the 5% Bonds mortgaged, hypothe- cated and pledged under this Indenture at the time of estate- delivery thereof to the Trustee have been duly and lawfully issued, and that said 5% Bonds are secured by the Trust Deed which is a valid first mortgage or its equivalent (excepting certain mortgages aggregating in value approximately $476,700 as of May 1, 1922, but as to which certain mortgages there is now and will ho kept by the Company specially set aside and deposited with the Trustees under the Trust Deed sufficient moneys for the express purpose and no other purpose of fully and completely satisfying and dis- charging such certain mortgages) upon all the principal properties of the Company mortgaged or intended to be mortgaged by the Trust Deed, and that said 5 % Bonds are valid obligations of the Company and constitute a valid security according to their terms, and that the same are free and clear of all liens, claims and encumbrances of every kind and nature, and that the Company is law- fully possessed of all said 5% Bonds, and is duly au- thorized to deliver the same to the Trustee and to mortgage, pledge and hypothecate the same here- 36 Covenant further assurance. iiiKler. and that this Indenture is and always will be kept a first mortgage and lien upon all the trust estate hereby mortgaged, hypothecated and pledged, or agreed or intended so to be, and that the Com- pany will not voluntarily create, or suffer to be created any debt, lien or charge wliich would be prior to the lien of this Indenture upon the trust estate, or any part thereof, or upon the interest thereon, and will promptly pay and discharge every obligation for which any lien upon the trust estate prior to the lien of this Indenture exists or could be created; provided that nothing contained in this Section 6 shall require the Company to pay any alleged debt, lien or charge so long as it shall in good faith and by appropriate legal proceedings contest the validity thereof, unless there- by in the opinion of the Trustee or of counsel selected or approved by the Trustee, the rights and security of the holders of bonds secured hereby shall be materially endangered. Section 7. That at any and all times the Company will do, execute, acknowiedge and deliver, or will cause to be done, executed, acknowledged and delivered all and every such further acts, deeds, conveyances, mortgages and transfers and assurances in law as the Trustee shall reasonably require, for the better assuring, mortgaging, hypothecating, pledging, assigning and confirming unto the Trustee all and singular the trust estate and prop- erty hereby mortgaged, hypothecated, pledged or as- signed, or intended so to be. :^7 Section 8. That the Company from time to time will Company to pay taxes. pay and discharge all taxes, assessments and govern- mental charges which shall be lawfully imposed upon the Comxiany, or upon the trust estate at any time subject to the lien of this Indenture, or upon the property sub- ject to the lien of the Trust Deed, or upon any part there- of, or upon the interest, income and profits thereof, as well as all lawful claims for labor, materials and sup- jilies, which if unpaid, might by law become a lien or charge upon the trust estate, or ufjon the pro|)erty subject to the lien of the Trust Deed, or any part thereof, the lien of which would be prior to the lien hereof, or of the Trust Deed, as the case may be, so that the priority of this Indenture and of the Trust Deed shall be fully preserved and that the Company will not create or suffer to be created any mechanic’s, laborer’s or other lien or charge whatsoever upon the trust estate or u^jon the property subject to the lien of the Trust Deed, or any part there- of, or upon the interest, income and profits thereof, which might or could be prior to the lien of this Indenture, or of the Trust Deed, as the case may be, or do or suffer any matter or thing whereby the lien of this Didenture or of the Trust Deed might or could be impaired. Nothing in this Section contained shall require the Company to pay any such tax, assessment or charge or any claim which might be used as the basis of lien or charge so long as the Company in good faith shall contest the validity thereof. Section 9. That the Company will at all times take or company tc cause to be taken all such action as from time to time nights may be necessary to preserve the corporate existence and corporate rights and franchises of the Company, and will duly procure all renewals and extensions thereof, 38 and will diligently preserve all the rights, powers, privi- leges and franchises and good will held by it, and will carry on and conduct the business of the Company in a proper and efficient manner, and will comply with such statutes and laws in all places in which it shall do busi- ness as it shall be advised by counsel learned in the law it should comply with in order fully to be authorized to conduct such business. Section 10. That the Company, from time to time, will Company not to de- fault under punctually obser\^e and perform all of its obligations, and subject to will pay and discharge all amounts payable, under or by mortgage. virtue of any lease of property, the leasehold interest in which is, or shall hereafter become, subject to the lien of the Trust Deed, and will not suffer or permit any default for which any such lease might be terminated, so that the interest of the Company in any such leasehold estate may be at all times preserved unimpaired as security for the trust estate ; provided, however, that nothing contained in this Section shall require the Company to make any such payments or to observe any such obligations, so long as it shall in good faith contest its liability therefor. Company to SECTION 11. That the Company will cause this Inden- register this Indenture ture and every additional instrument which shall be exe- and other instruments, cuted pursuant to the foregoing provisions and all par- ticulars of the mortgage or charge hereby created and all instruments, matters and things, forthwith upon exe- cution hereof to be recorded, filed and/or registered, and will pay any mortgage recording tax or other tax legally due upon such recording, filing and/or register- ing, and will punctually and fully comply with the re 39 quirements of any and every mortgage recording tax law or other law affecting the due recording, filing and/or registering as aforesaid, in such manner as may be neces- sary fully to preserve, continue and protect the security of the Bonds, the superior lien of this Indenture on the trust estate and the rights and remedies of the Trustee, and will similarly preserve, continue and protect the se- curity of the trust estate, the superior lien of the Trust Deed on the property subject or intended to be sub- ject to the lien of the Trust Deed, and the rights and remedies of the Trustees under the Trust Deed. Section 12. That the Company will at all times main- Company to tain, preserve and keep its vessels and properties and properties in every part thereof, in good repair, working order and repair, condition, and will from time to time make all needful and proper repairs, renewals, replacements, additions, betterments and improvements thereto, so that the busi- ness carried on in connection therewith, and every por- tion thereof, may at all times be properly and advantage- ously conducted. Section 13. That policies for all insurance which the Company to insure prop- Company has covenanted in the Trust Deed to keep shall erties. be made payable to the Trustees under the Trust Deed as their interest may appear, whether heretofore or here- after issued, provided that in the case of Marine Insiir- ance Policies the insurance or proceeds thereof shall only be payable to the Trustees under the Trust Deed in re- spect of losses constituting total losses and/or construc- tive total losses, all to the extent that the same may be done without violating the provisions of the Trust Deed. 40 Dividends SECTION 14. That the Company will not declare or pay payable only t • t i \ out of earn- any dividends (except stock dividends) on any ot the ing Bubse- capital stock of the Company at any time outstanding, janua/y 1, except oiit of surpliis curreiit earnings accruing subse- quent to January 1, 1922, and remaining on hand after deducting all operating expenses and fixed charges, in- cluding in such operating expenses taxes, insurance, ren- tals and reasonable expenditures for repairs and main- tenance, and Including in such fixed charges interest upon all funded and all unfunded debt. The term “surplus current earnings” as used in this Section 14, shall not be deemed to include unrealized appreciation in value of real estate, vessels, plants, machinery, equipment or other capital assets. Section 15. That the Company will not, so long as any of the Bonds shall be outstanding, sell or otherwise dis- pose of any of its vessels, real estate or other prop- erty now or hereafter subject to the lien of the Trust Deed, unless the property so sold or otherwise disposed of shall previous to such sale or other disposition or coincident therewith be released from the lien of the Trust Deed as therein provided. Section 16. That the Company will promptly and duly eity*^to bT^ execute and deliver or cause to bo duly executed jcct^to*\ien and delivered and filed, recorded land/or registered all Supplements to the Tnist Deed, or other in- struments, satisfactory in form to the Trustees under the Trust Deed and which may be necessarjq or which the Trustee under this Indenture or the Trus- tees under the Trust Deed shall reasonably request to be executed and delivered, and filed, recorded and/or Company not to dis- pose of mortgaged property unless re- loased. After ac- 41 registered, and other things to be done, in order to make subject to the mortgage and lien of the Trust Deed secur- ing the Debenture Stock and/or 5% Bonds all property now owned or which may be hereafter acquired, directly or indirectly, by the Company and which is not now or which would not otherwise become subject to the mort- gage and lien of the Trust Deed. Section 17. That the Company hereby renounces the right granted in, under and by virtue of the Trust Deed $i3,675,4(i6. to issue from time to time and at any time Debenture Stock and/or 5% Bonds secured under and by virtue of the Tnist Deed in excess of $13,675,- 466. par or principal amount, being the aggregate amount of Debenture Stock and/or 5% Bonds issued and outstanding and to bo issued in exchange for De- benture Stock and/or Bonds outstanding under and in accordance with the Trust Deed, and that no further is- sues of Debenture Stock and/or 5% Bonds in excess of $13,675,466. par or principal amount will be made under the terms of said Trust Deed or be secured by mortgage ranking pari passu with the mortgages constituted by and under the provisions of the Tnist Deed, and declares that by the terms of the Trust Deed it has in pursuance and fulfillment of the covenants and agreements by it entered into and in favor of the Trustees under the Trust Deed closed the mortgage, pledge and hypothecation securing the Debenture Stock and/or Bonds at the sum of $13,675,466. par or principal amount, and that it will adopt and enact all such resolutions and by-laws and generally do all such matters and things as may be re- quired or considered advisable by the Trustee under this Indenture and the Trustees under the Trust Deed in order legally and effectively to close said mortgage at said sum of $13,675,466. par or principal amount to the 42 Company not to de- fault under Trust Deed. satisfaction of the Trustee under this Indenture and the Trustees under the Trust Deed. Section 18. That the Company will pay (except as provided in Section 3 of Article V hereof) the instal- ments of principal and interest on all the Debenture Stock and 5% Bonds from time to time outstanding, when the same shall become due and payable, and will not, directly or indirectly, extend or assent to the extension of the time for payment of any such instalment of in- terest or principal, and will not, directly or indirectly, be a party to or approve any such extension by purchas- ing or refunding said instalments of interest or princi- pal or in any other manner, and will duly and punctually carry out and perform each and every agreement, cove- nant, condition and provision to be performed by it as and when and in the manner provided in the Trust Deed and in the Debenture Stock and/or 5% Bonds, and will not permit the same to he in default in any respect, and in case any such default shall occur or exist then the Trustee may in its discretion and shall upon the request in writing by the holders of one-fourth in amount of the Bonds then outstanding or by an extraordinary resolu- tion passed at a meeting of the Bondholders in accord- ance with the provisions contained in the schedule hereto attached, marked Schedule A and by reference made a part hereof, (herein called “Schedule A”), and for and in behalf, in the name and at the expense of the Com- pany, remedy any such default or defaults, without any impairment of or prejudice to the rights of the Trustee or the Bondholders under this Indenture, and the Company wUl on demand pay to the Trus- tee all sums expended by the Trustee for such pur- poses, with interest thereon at the rate of seven per cent. 43 per annum from the date of such expenditures, respec- tively, and the Trustee shall have a lien for such expendi- tures and interest upon any funds held by it hereunder and upon the trust estate and upon the proceeds thereof in priority to the Bonds, but the Trustee shall not be under any obligation to remedy any such default or de- faults unless first fully indemnified to its satisfaction against the expense thereof or furnished with means therefor by one or more of the Bondliolders, together with all loss or damage which it may incur by reason thereof. Section 19. That the Company -will at all times keep Company to keep proper proper books of record and account in which full, true books, and correct entries will be made of all dealings or trans- actions of or in relation to the vessels, properties, busi- ness and affairs of the Company, which at all reasonable times shall be open to the inspection of the Trustee, or any person, firai or corporation designated in writing from time to time by the Trustee, or of or by its succes- sors. The Trustee, if requested in writing by the hold- ers of at least one-fourth in amount of the Bonds then outstanding, or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A, shall cause the books and accounts of the Company to be examined by an accountant selected by the Trustee and that the Company will pay the expense of any such examination. ARTICLE V. Provisions as to Trust Estate. Section 1. All 5% Bonds and/or Debenture Stock Trust estate which are now or may at any time be or become subject livered to 44 Trustee with J q of this Indenture (either in temporary or instruments t' j of assign- permanent form) shall be delivered to and held by the ment. Trustee, and shall, at the time of delivery to the Trus- tee, be accompanied by proper instruments of assigai- ment to the Trustee or in blank and powers of attorney for their transfer to the Trustee or in blank, duly execu- ted by the record or registered owmer thereof, and also by any transfer stamps or taxes required by law to effect the transfer thereof. have^trus?^^ SECTION 2. At any time the Trustee may cause to be 3state trans- qj. transferred into its name, as Trustee own name, hereunder, all or any of the tnist estate delivered to the Trustee ; or in the discretion of the Trustee it may hold any such trust estate in bearer form or in the name of the record or registered owner thereof at the time of such pledge, or iiv the name of a nominee of the Trustee, provided that the same unless in bearer form be endorsed in blank for transfer, or be accompanied by proper in- struments of assignment in blank duly executed by such record or registered owner or nominee. Interest not SECTION 3. Uiiless and Until isome one or more of the payable on trust estate, eveiits of default specified in Section 2 of Article VI here- of shall have happened and be subsisting, the Company shall, notwithstanding any of the trust estate is registered in the name of the Tinistee, be under no obligation to make any payment to the Trustee with respect to in terest on the trust estate and the Company, from time to time, shall be entitled to receive and collect all in- terest that may be paid on any of the trust estate which may at any time be pledged here- under, and the Trustee, whether or not any of the 45 trust estate be then rei^istered in its name, on written demand of the Company, froin time to time, sliall deliver to it suitable assignments and orders for the payment to it of all such interest as from time to time may be- come payable on such trust estate and the Trustee, from time to time, upon written demand of the Company, shall pay over to it any and all sums which may bo received or collected by it for interest upon the trust estate. Section 4. So long as any of the Bonds shall remain outstanding, the Company shall have no voting rights and powers with respect to any 5% Bonds and/or De- benture Stock hypothecated and pledged with the Trus- tee under this Indenture and all such voting rights and powers shall so long as the Bonds remain outstanding be absolutely vested in the Trustee, nnd the Company shall make and deliver or cause to be made and delivered to the Trustee or to its nominee or nominees suitable powers of attorney or proxies to vote upon any of the trust estate which may at any time be recorded or re- gistered in the name of the Company or its nominees or to give consents in respect thereto, and the Trustee may at its discretion, and upon the request in writing of the holders of one-fourth in amount of the Bonds then out- standing or by an extraordinary resolution passed at a meeting of the Bondliolders in accordance with Schedule A shall in accordance with and as directed by such writ- ing or resolution, exercise such voting rights and powers, directly, or by or through nominee or nominees, substi- tute or substitutes, proxy or proxies, attorney or attor- neys, or otherwise, providing that the Trustee shall be under no obligation under this Section 4 unless and un- 46 til it shall have been indemnified to its satisfaction against all expense, loss or damage which the Trustee may incur in connection therewith. Company Provided, however, unless and until some one or more may be given voting of the eveiits of default specified in Section 2 of Article rights under trust estate. VI hereof shall have happened and be subsisting, the Trustee may in its discretion, and upon request in writ- ing of the holders of a majority in amount of the Bonds then outstanding or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A shall, confer on the Company any or all such voting rights and powers hereinbefore mention- ed in this Section 4 with the same force and effect as though the trust estate were not subject to this Inden- ture, and for such purpose the Trustee shall make and deliver or cause to be made and delivered to the Company or to its nominee or nominees suitable powers of attorney or proxies to vote upon any of the trust estate which may at any time be recorded or registered in the name of the Trustee or its nominees or to give consent in respect thereof, but every power of attorney or proxy given to the Company or its nominee or nominees shall, either (a) be limited so as expressly to authorize only the casting of a vote or votes or the giving of a consent or consents for a purpose or purposes stated in the power of at- torney or proxy which shall be not inconsistent ’with the provisions of this Indenture, or (b) bear on its face substantially the following statement : “The powers here- by conferred shall not be exercised for any purpose in- consistent with the provision of the First Mortgage Col- lateral Timst Deed of Canada Steamship Lines, Limited, dated as of May 1, 1922”, whichever such alternative 47 either (a) or (b), the Bondliolders may desigiiate in such request in writing or resolution, or, in the absence of designation the Company may select. An opinion of counsel (who may be of counsel for the Company) shall be furnished to the Trustee stating that the pur- pose or purposes expressed in any power of attor- ney or proxy for the purposes for which the same is given, which the Trustee is requested to give in the form authorized by the foregoing clause (a), are not in- consistent with the provisions of this Indenture, shall be fuU protection to the Trustee in giving such power of attorney or proxy. Section 5. (i) Unless and until some one or more of Surrender of the events of default specified in Section 2 of Article VI estate, hereof shall have happened and be subsisting, (a) in case and when and as Bonds are purchased for the Sink- ing Fund and surrendered to the Trustee for cancella- tion as provided in Article II of this Indenture and/or (b) in case and when and as there shall be moneys in the Sinking Fund or on deposit with the Trustee appli- cable to the redemption of Bonds as provided in Articles II and III of this Indenture, including the premiums as provided in said Article III in case of redemption and the unpaid interest accrued to the date of redemp- tion, and the Trustee shall be furnished with proof in- suring to its satisfaction that notice or notices of re- demption of the amount of Bonds so redeemable have been given by publication as provided in Article III or that arrangements have been made that such notice or notices by publication will be given, the Trustee in either or both of such cases (a) and (6), upon full pajnnent of 48 all its costs, charges and expenses in relation thereto or otherwise under this Indenture, shall surrender and as sign, transfer and deliver to the Company or upon its order, freed and discharged of the pledge and charge contained in this Indenture except as hereinafter in this Section 5 provided, 5% Bonds and/or Debenture Stock, as the Trustee may de- termine, pledged and hypothecated with it here- under, in a principal or par amount substantially equal to but not exceeding 140% (subject to the provisions of paragraph ii of this Section 5) of the principal amount of Bonds so purchased and/or redeemable, accompanied by proper instruments of assignment or powers of attorney for their transfer to the Company, duly executed by the Trustee or its nominee in whose name the same may at the time be registered, but any transfer stamps or taxes required by law to effect the transfer thereof shall be paid by the Company. Provided, however, that the 5% Bonds and/or Debenture Stock surrendered from time to time to the Company in accordance with the pro- visions of this paragraj)!! (i) shall be applied by the Company in one of the following two ways and not otherwise : (A) As soon after such surrender of 5% Bonds and/or Debenture Stock to the Company pursuant to this paragraph (i) as the Company shall have notice that there are funds or moneys in the sink- ing fund under the Trust Deed applicable to the purchase of 5% Bonds and/or Debenture Stock and in any event not later than one year next follow- ing each such surrender of 5% Bonds and/or De- benture Stock, the Company may offer any 5% 49 Bonds and/or Debenture Stock so surrendered to it in accordance with the provisions of this paragraph (i) for purchase out of the funds or moneys in the sinking fund under tlie Trust Deed in competition with any other hold- ers of 5% Bonds and/or Debenture Stock who may make offerings for the purchase of their 5 % Bonds and/or Debenture Stock out of the sinking fund under the Trust Deed, and the Company shall in such offer describe the 5% Bonds and/or Deben- ture Stock so offered by numbers and amounts or in such other manner as may clearly identify the same and shall also state in such offer that the 5% Bonds and/or Debenture Stock so offered were surrendered to the Company under and pursuant to this Section 5 and the date of such surrender, and the Company shall forthwith deliver to the Trustee under this Indenture a copy of such offer. In the event such offering of the Company is ac- cepted by the Trustees under the Trust Deed the 5% Bonds and/or Debenture Stock so offered by the Company shall be sold by it and surrendered to the Trustees under the Trust Deed subject to the provisions of the Trust Deed, (B) The Company shall forthwith surrender to the Trustees under the Trust Deed and cause to be cancelled and not to be reissued all 5% Bonds and/ or Debenture Stock surrendered to it by the Trus- tee in accordance with the provisions of this paragraph (i), (1) which the Company shall have had the opportunity to otfer to the Trustees under the Trust Deed in accordance with the provisions 50 of subdivision (A) of this paragraph (i) but which the Company shall not have so offered within the time mentioned in said subdivision (A), and/or (2) which the Company shall have once so offered to the Trustees under the Trust Deed but which shall not have been purchased by the Trustees under the Trust Deed upon such offer. (ii) Provided, however, that in determining the afore- said 140% in 5% Bonds and/or Debenture Stock to be surrendered and assigned, transferred and delivered to the Company or upon its order in accordance with the provisions of paragraph (i) of this Section 5, credit s.hall be taken for any 5% Bonds and/or Debenture Stock theretofore surrendered to the Tnistees under the Trust Deed pursuant to Section 3 of Article II hereof, so that there shall be at all times subject to the lien of this In- denture for the security of the Bonds an aggregate prin- cipal or par amount of 5% Bonds and/or Debenture Stock equal to at least 140% of the aggregate principal amount of Bonds from time to time outstanding, less the aggregate principal amount of Bonds, moneys and provision for the redemption of which shall then be sub- sisting as provided in (b) of paragraph (i) of this Sec- tion 5. (in) All 5% Bonds and/or Debenture Stock sur- rendered to the Company under the provisions of paragraph (i) of this Section 5 shall before being so surrendered be stamped by the Trustee across the face thereof vdith a stamp reciting the date of such surrender and that the same are subject to the provisions of this Section 5, such stamp to be substan- tially in the following form: 51 This Bond was surrendered, upon the date of this endorsement recited below, to Canada Steam- ship Lines, Limited, under and pursuant to Section 5 of Article V of a certain First Mortgage Collat- eral Trust Deed between Canada Steamship Lines, Limited and Montreal Trust Company as Trus- tee dated May 1, 1922 and is subject to applica- tion by Canada Steamship Lines, Limited as in said Section provided and not otherwise. Dated Montreal Trust Company. Section G. In case all of the 5% Bonds and/or De- benture Stock at any time comprising the trust estate under this Indenture shall be redeemed by the Company in accordance with the provisions of the Trust Deed, then in such case the Trustee shall surrender the 5% Bonds and/or Debenture Stock so called for redemp- tion upon the receipt of the redemption price therefore as provided in the Trust Deed, and such redemption price of said 5% Bonds and/or Debenture Stock shall be held hereunder by the Trustee as the trust estate and as security for the Bonds in lieu of the 5% Bonds and/or Debenture Stock so redeemed, but the Trustee is hereby expressly authorized and empowered from time to time to invest and reinvest and keep invested any or all such redemption price of said 5% Bonds and/or Debenture Stock, and any or all of the proceeds thereof or of such investment or reinvestment, in any securities or prop- erty of any kind or description whatsoever, without any restriction whatsoever by statute, law or otherwise, as to the character of investments or otherwise, and the Trustee shall not be held responsible for any deprecia- Redemption of trust estate. 52 tion in value of the trust estate by reason of anything done by it hereunder. Unless and until some one or more of the events of default specified in Section 2 of Article VI hereof shall have happened and he subsist- ing any and all interest and other earnings upon such redemption price of said 5% Bonds and/or Debenture Stock, or any investment or reinvestment thereof, shall upon the receipt by the Trustee of such interest and other earnings be immediately paid over by the Trustee to the Company and the Company’s receipt therefor shall be sufficient discharge to the Trustee. (a) In the event at any time such redemption price of said 5% Bonds and/or Debenture Stock shall be held by the Trustee in the form of money and shall be sufficient in amount to redeem all of the Bonds then outstanding in the manner pro- vided in Article III hereof, the Company may notify the Trustee that it has exorcised its option pursuant to subdivision {a) of Section 1 of Article III hereof to redeem the whole amount of Bonds outstanding as of the next semi-annual interest date at which such redemption may be had, and such money shall thereupon be held and applied by the Trustee in the redemption of the Bonds as provided in Article III hereof ; or {h) In the event such redemption price of said 5% Bonds and/or Debenture Stock shall be held by the Trustee in whole or in part in any form other than money, the Trustee shall notify the Company within a reasonable time after request in writing by the Company to the Trustee to be advised whether or not in the opinion of the Trus- tee such investment is convertible into money suf- 53 ficient in amount (when added to the part, if any, of such redemption price of said 5% Bonds and/ or Debenture Stock then held by the Trustee in the form of money) to redeem as provided in Article III hereof the whole amount of Bonds then out- standing on any semi-annual interest date speci- fied by the Company in such request to the Trus- tee, and in case the Trustee’s notification as afore- said shall be in the affirmative, the Company shall in writing notify the Trustee to make such con- version and that in case such conversion shall re- sult in there being on deposit with the Trustee under this Section an amount of money sufficient to redeem the whole amount of Bonds outstand- ing on the semi-annual interest date specified by the Company in said request to the Trustee then in such case the Company exercises its option to redeem as of said semi-annual interest date the whole amount of the Bonds outstanding, and in case there shall be such a result from such con- version such moneys shall thereupon be held and applied|by the Trustee in the redemption of Bonds on said semi-annual interest date as provided in Article III hereof. Unless and until such redemption price of said 5% Bonds and/or Debenture Stock shall be applied as pro- vided, in (a) or (h) of this Section 6, there shall be paid therefrom from time to time by the Trus- tee to the Company as and when the Trustee would be required to surrender 5% Bonds and/or Debenture Stock pursuant to the pro\dsions of Section 5 of this Article an amount thereof equal in value, as determined by the Trustee, to 140% of the Bonds so pur- 54 chased and/or redeemable plus a proportionate amount of the premiums and other sums if any received by the Trustee upon the redemption of the trust estate. Exchange of SECTION 7. The Trustee, from time to time, mav when- trust , ’ . estate. ever it shall be necessary or convenient in order to carry out the surrender by the Trustee of the required amount of 5% Bonds and/or Debenture Stock in accordance with the provisions of Section 5 of this Article, or othervuse in the discretion of the Trustee, and upon request in writing by the holders of a majority in amount of Bonds then outstanding or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A shall, exchange in any manner provided in the Tnist Deed any part or all 5% Bonds at any time hypothecated and pledged under this Indenture for an equal aggregate par or principal amount of 5% Bonds in any denominations and/or an equal aggregate par or principal amount of Debenture Stock, and any part or all Debenture Stock at any time hypothecated and pledged under this Indenture for an equal aggregate par or principal amount of Debenture Stock in any denomina- tions and/or an equal aggregate par or principal amount of 5% Bonds, and the Company shall upon any such ex- change execute and deliver to the Trustee proper instru- ments of assignment to the Trustee or in blank and powers of attorney for the transfer to the Tnistee or in blank of any 5% Bonds and/or Debenture Stock record- ed or registered in the name of the Company or its nominee deliverable to the Trustee under this Sec- tion, and shall also pay any taxes required by law to effect such exchange. Debenture Stock and/or 5% 55 Bonds, as the case may be, so received by the Trustee upon any such exchange shall be held by the Trustee as the trust estate hereunder in every respect and for all purposes the same as if such Debenture Stock and/or 5% Bonds had been originally mortgaged, hypothecated and pledged, and transferred and assigned hereunder. Section 8. In case the Company shall be in default Trust Deed under the Trust Deed and/or the Debenture Stock and/or by Trustee. 5% Bonds or the security of the Debenture Stock and/or 5% Bonds of the Company becomes enforcible then (whether or not any one or more of the events of de- fault specified in Section 2 of Article VI shall have hap- pened or be subsisting, or this Indenture be enforcible) the Trustee may in its discretion, and upon request in writing by holders of one-fourth in amount of the Bonds then outstanding or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A shall, and upon being furnished with funds and indemnified to the satisfaction of the Trustee against all liability, loss, costs, charges and expenses which the Trustee may incur in so doing, and in any case without any further consent on the part of the Company, and without prejudice and in addition to any other powers and remedies herein contained, anything herein to the contrary notwithstanding, take such steps and proceed- ings as it as holder of the trust estate, or as any lawful owner or holder of the property in the trust estate, might or could lawfully do or cause to be done under the terms of the Trust Deed, Debenture Stock and/or 5% Bonds to enforce the obligations of the Company under or the security of the Trust Deed, Debenture Stock and/or 5 % 56 Bonds by any action at law or in equity, foreclosure or sale or by the appointment of a receiver or sequestrator of the undertaking and property of the Company which is for the time being subject to such security or by the appointment of a liquidator under the Winding Up Act or a trustee under the Bankruptcy Act or otherwise, or by all or any of such means, or by any other means or remedy provided by the Trust Deed; and the proceeds thereof, after deducting all proper charges and expenses of the Trustee occasioned thereby, shall be treated as a part of the trust estate under this Indenture. Subject to specific re- strictions, Trustee to have all rights of ownership. Section 9. Subject only to the specific restrictions contained in this Indenture, and to the actual exercise by the Company of its rights in respect thereof conferred by this Indenture, the Trustee shall have and may exercise all the rights of ownership in respect of any of the trust estate held by the Trustee under this Indenture or in any manner whatsoever upon the trusts hereof. ARTICLE VI. Remedies of Trustee and Bondholders. Coupons Section 1. No coupon belonging to any of the Bonds from'*Bomis wliicli in ally way shall have been transferred or pledged onUnatecI' apart fi’om the Bond to which it relates Bonds and gjiall unless accompanied bv such Bond, be entitled in coupons not ^ a - ? so separated, case of a default under this Indenture to any benefit of or from this Indenture, except after the prior pa^unent in full of the principal of the Bonds and of all coupons not so transferred or pledged. 57 Section 2. In case one or more of the following Evente of default: events, herein termed events of default, shall happen, that is to say, in case (a) default shall be made in the payment of the — non-pay- ment of principal of any of the Bonds when and as the principal, same shall become due and payable, either at maturity or by declaration or otherwise ; or (b) default shall be made in the pa>mient of any instalment of interest on any of the Bonds when and as the same shall become payable, as therein and herein expressed, and such default shall have continued for thirty days ; or (c) default shall be made in the payment of — ' ' Sinking any instalment of the Sinking Fund herein pro- Fund, vided for, and such default shall have continued for thirty days; or (d) default shall be made in the observance or —any other performance of any of the other covenants or hereunder, agreements on the part of the Company in the Bonds or in this Indenture expressed and the Company shall not have remedied such default witliin sixty days after written notice, specifying such default and requiring the Company to remedy the same, shall have been served upon the Company by the Trustee, which may in its discre- tion, and at the request of the holders of one-fourth in amount of the Bonds then outstanding, or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A shall, give such notice ; or 58 — default cauaing any other funded debt to be detdared due. — non-pay- ment of principal or interest on any bond or obligation superior to the lien of this Inden- ture. — bank- ruptcy, etc. (e) an event of default as defined in any inden- ture, trust agreement, trust deed or other instru- ments or supplements thereof securing or pro- tecting any other funded debt of the Company now or hereafter existing shall happen and shall result in such funded debt being declared due and payable prior to the date on which it would other- wise become due and payable ; or (/) default shall be made (1) in the payment of any instalment of interest or sinking fund upon any Debenture Stock, 5% Bond or other obliga- tion secured or charged as a lien prior hereto on any part of the property or plants of the Company, and any such default shall have continued for a period of thirty days, or (2) in the payment of the principal of any such Debenture Stock, 5% Bond or other obligation, or (3) the Trust Deed and/or Debenture Stock and/or 5% Bonds shall be other- wise in default, provided, however, that such non- payment shall not constitute a default if the funds to pay such interest and/or sinking fund and/or principal shall have been deposited with the Trus- tee, nor so long as the Company shall in good faith contest the validity of the claim or demand and stay the execution thereof ; or (g) the Company shall become insolvent, or by decree of a court of competent jurisdiction, the Company shall be adjudged a bankrupt, or, by order of like court, a receiver, sequestrator or liquidator shall be appointed of the Company or 59 of all or a substantial part of the property of the Company, or the Company shall consent to the appointment of such a receiver, sequestrator or liquidator, or, by order of like court, a decree shall be made providing for the vdnding up or liquidation of the business and affairs or a sub- stantial part of the business and affairs of the Company, or the Company shall voluntarily take any action for such winding up or liquidation; or (/(.) the Company shall file a petition for volun- tary bankruptcy, or shall make a general assign- ment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as tliey become due, or cease to carry on its busi- ness; or (i) distress or execution or other similar pro- cess be levied or conferred upon any of the prop- erty of the Company, and the same remain undis- charged or uncontested by the Company for five days after the service thereof upon the Company or against the property, or final judgment for the payment of money shall be rendered against the Company and the Company shall not discharge the same or cause it to be discharged -within sixty days from the entry thereof, or shall not appeal therefrom or from the order, decree or process upon which or pursuant to which said judgment was granted, passed or entered, or the holder or owner of any encumbrance shall take possession of the property of the Company or a substantial — general assignment, written ad- mission of inability to pay debts. — judgment for payment of money. 60 part thereof, and such taking of possession shall in the opinion of the Trustee he prejudicial to the security hereby constituted; or {j) the Company shall without the consent of the Trustee or the sanction by an extraordinary resolution passed at a meeting of the Bondholders in accordance with the provisions of Sched- ule A make or adopt or attempt to make or adopt any alterations in its Letters Patent or Incorporation or By-laws or in the Trust Deed securing the Debenture Stock and/or 5% Bonds which might in the opinion of the Trustee be detri- mental to the interest of the Bondholders or the security of the Bonds; Trustee may then, the Trustee may in its discretion, and upon request cipai due. in writing by the holders of one-fourth in amount of the Bonds then outstanding or by an extraordinary resolu- tion passed at a meeting of the Bondholders in accordance with Schedule A shall, by written notice to the Company, declare the principal of all the Bonds, if not already due, to be forthwith due and payable, and upon such declaration the same shall become due and payable im- mediately, anything in this Indenture or in the Bonds )?ecdMltkm contained to the contrary notwithstanding. This provi- sion, however, is subject to the condition that if, at any time after the principal of the Bonds shall have been so declared due and payable and prior to the date of matur- ity of the Bonds specified therein, all arrears of interest upon all the Bonds, with interest on overdue instal- ments of interest at the rate of seven per cent, per annum, 61 and all arrears of Sinking Fund payments, with interest thereon at the rate of seven per cent, per annum, and all expenses of the Trustee, its agents and attorneys, and all amounts in respect of which the Oompany shall then be in default under this Indenture, other than the princi- pal of the Bonds, shall either be paid by the Company or be collected out of the income derived from the trust estate before the sale thereof or the recovery by the Trus- tee of final judgment of decree under this Indenture, and no other event of default of which the Trustee shall have received previous notice and in respect of wliicli the security hereby constituted shall be enforcible shall exist or any or all of such defaults shall have been made good to the satisfaction of the Trustee, then and in every such case the holders of a majority in amount of the Bonds then outstanding, by written notice to the Company and to the Trustee or by an extraordinary resolution passed at a meeting of the Bondliolders in accordance with Schedule A, may rescind and annul such declaration and its consequences; but no such rescission and annulment shall extend to or affect any subsequent default or im- pair any right consequent thereon. Section 3. Upon the happening of one or more of the events of default specified in Section 2 of this Ar-”^ proxies tide, then and in each and every such case, such default subsisting, the Trustee may, and upon request in writ- ing by the holders of one-fourth in amount of the Bonds then outstanding or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A shall, revoke any and all proxies and 62 powers of attorney issued to the Company or on its order and revoke any and all assignments and orders with respect to interest, income or profits upon the trust estate and any and all consents theretofore granted by the Trustee for the exercise of other rights by the Com- pany or its nominee or nominees with respect to any of the trust estate, and the interest on the 5% Bonds and/or Debenture Stock pledged hereunder shall com- mence to accrue and be payable from the date of such default, and the Company so covenants and agrees any- thing in this Indenture to the contrary notwithstanding, and shall be applied by the Trustee in the manner pro- vided in Section 4 of this Article. In case of SECTION 4. Upon the happening of one or more of Trustee may the events of default specified in Section 2 of this Ar- rights of tide, then and in each and every such case, such default ownership, ^he Trustee personally or by agents or at- torneys, may exercise all the rights of ownership of the trust estate and each part thereof, including the right to vote upon any or all the 5% Bonds and/or Deben- ture Stock pledged hereunder or to give written re- quests in respect thereto in accordance with the Trust Deed and receive and collect the principal and interest, income and profits thereon or arising out of the opera- tion or management of the trust estate and every part thereof, and consent to or oppose any renewals, exten- sions or modifications of any of the trust estate, and take any action or proceedings which the holder or owner thereof for value could take as such ovmer or holder including the right to offer and surrender to the Trus- 63 tees under the Trust Deed any of the 5% Bonds and/or Debenture Stock pledged hereunder for purchase out of moneys or funds in the sinking fund under the Trust Deed at any price that the Trustee shall deem for the best interests of the Bondholders, and all such rights of the Company shall cease. All sums received or collected by the Trustees as aforesaid during the continuance of any such default, together with any other sums which may be held by the Trustee hereunder, other than moneys in the Sinking Fund, after deducting therefrom all jjroper charges, costs and expenses including expenses of operat- ing the trust estate and all payments which may be made for taxes, assessments, insurance and prior or other proper charges as well as just and reasonable compensa- tion for the Trustee’s services and for all attorneys, agents, clerks, servants and other employees by it prop- erly engaged and employed, shall by the Trustee be ap- plied as follows: (a) In case the principal of the Bonds shall not have become due, to the payment of the in- terest, if any, in default, in the order of the ma- turity of the instalments of such interest, with in- terest thereon at the rate of seven per cent, per annum, such payments to be made ratably to the persons entitled thereto, without discrimination or preference, and after the payment of all arrears of interest with interest thereon as aforesaid to the payment of any instalment of the Sinking Fund then in default, with interest on the respec- tive insitalments in arrears at the rate of seven per cent per annum from the respective dates that such payments become due and payable; 64 (6) In case the principal of the Bonds shall have become due, either at maturity or by declara- tion or otherwise, first to the payment of the ac- crued interest, in the order of the maturity of the instalments, with interest on the overdue instal- ments thereof at the rate of seven per cent, per annum, and next to the principal of the Bonds ; in every instance such payment to be made ratably to the parties entitled to such payments without any discriminaition or preference whatsoever. These provisions, however, are not intended in any- wise to modify the provision of Section 3 of Article IV hereof or of Section 1 of this Article VI, but are subject thereto. Restoration In case all of said pajunents shall have been made in of property • p , upon pay- fuU and no suit to foreclose or enforce this Indenture shall have been begun or sale made as hereinafter pro- vided, the Trustee, after making such provisions as to it may seem advisable for tlie payment of the next semi- annual instalment of interest to fall due upon the Bonds and for the next semi-annual pa^mient to be made as and for the Sinking Fund, may in its discretion restore the Company, its successors and assigns, to its or their form- er position, provided that if any event of default speci- fied in Section 2 of this Article VI shall subsequently occur, such restoration shall not, nor shall any previous action by the Trustee under this Section be construed to exhaust or in any manner impair any powers hereby granted to or conferred upon the Trustee. 65 Section 5. In case of the happening of one or more of in case of default, the events of default specified in Section 2 of this Article Trustee may (1) sell VI. then and in each and every such case, such default trust estate . . or (2) pro- subsisting, the Trustee may tect the Bondholders (а) Personally or by its attorneys or P’’®' sell to the highest responsible bidder all or any part of the trust estate, and all right, title and interest, claim and demand therein, and the right of redemption thereof, in one lot or in parcels, un- less a sale in parcels shall be requested under the provisions of Section 7 of this Article, in which case such sale may be made in parcels as in said Section provided; which sale or sales shall be made and notice thereof given as provided in Sec- tions 8, 9 and 10 of this Article VI; or (б) Proceed to protect and enforce its rights and the rights of Bondliolders under this Inden- ture by suit in equity or action at law, whether for the specific performance of any covenant or agreement contained herein or in aid of the execu- tion of any power herein granted or for any fore- closure hereunder or for the enforcement of any proper legal or equitable remedy as the Trustee, being advised by counsel, shall deem most effectual to protect and enforce the rights aforesaid. Section 6. Upon written request of the holders of Trustee to one-fourth in amount of the Bonds at the time outstand- “ghts^upon ing, or by extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A, and upon being indemnified, if it shall so require, as here- inafter provided, it shall be the duty of the Trustee to 66 take all steps needful for the protection and enforce- ment of its rights and the rights of the holders of the Bonds whether by judicial proceedings or otherwise as the Trustee, being advised by counsel, shall deem most expedient in the interest of the holders of the Bonds. Mortgaged SECTION 7. In the event of any sale, whether made property to ' be sold as under the power of sale hereby granted and conferred one parcel. or under or by virtue of judicial proceedings, the trust estate or any part therof shall be sold as one lot or in parcels, as the Trustee shall deem for the best interests of the Bondholders, unless the Trustee shall be requested in writing by the holders of a majority in amount of the Bonds then outstanding or requested by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A, to cause the trust estate to be sold in parcels, in which case the sales shall be made in such parcels as shall be specified in such request, or unless such sale in one lot is impracticable by reason of some statute or otherwise. Waiver of The Company, for itself and all persons and corpora- right to have security tious hereafter claiming through or under it or who may m fl rsViB-ll at any time hereafter become holders of liens jmiior to the lien of this Indenture, hereby expressly waives and releases all right to have the properties and estate com- prised in the security intended to be created by this In- denture marshalled upon any foreclosure or other en- forcement hereof, and the Trustee, or any court in which the foreclosure of this Indenture or administration of the trusts hereby created is sought, shall have the right as aforesaid to sell the entire trust estate as a whole in a single parcel or in several parcels. 67 Section 8. Except as hereinafter provided, any sale Sale to be at ^ A 7 V publie auc- by the Trustee made under the power of sale hereby tion; notice _ _ to be pub- granted and conferred, unless otherwise required by law, lished. shall be made to the highest responsible bidder at pub- lic auction at such place or places in the City of Montreal, Dominion of Canada or elsewhere, and at such time or times and upon such terms as the Trustee may fix. Notice of any sale, whether made under the power of sale hereby granted and conferred or under and by virtue of judicial proceedings, shall state the time and place when and where the same is to be made, shall contain a brief general description of the property to be sold, shall briefly state the terms of the sale, and such notice shall be sufficiently given if pub- lished once in each week for four successive weeks imme- diately preceding the date set for such sale in a daily newspaper of general circulation published in the City of Montreal, Dominion of Canada, and in a daily news- paper of general circulation published in the City of Toronto, in said Dominion, and in a daily newspaper of general circulation published in the Borough of Man- hattan, City of New York. The notice of sale herein required shall be in addition to or concurrent with any notice required to be given by law. Section 9. The Trustee may adjourn and from time Sale may be adjourned. to time readjourn any sale to be made by, it under the provisions of this Indenture, by announcement at the time and place appointed for such sale or for such adjourned sale or sales; and without further notice or publication of the sale, unless otherwise required by law, it may make such sale at the time and place to which the same may be so adjourned or readjourned. 68 Trustee to SECTION 10. Upon the completion of any sale or sales transfer ^ property to undoT this Indenture, the Trustee shall transfer and de- I)arehaser. liver or cause to be transferred and delivered to the ac- cepted purchaser or purchasers the property so sold. The Trustee and its successors hereby are appointed the true and lawful attorneys irrevocable of the Company in its name and stead to make all necessary transfers of property thus sold, and for that purpose it or they may execute all necessary instruments of assignment and transfer, the Company hereby ratifying and confinning all that its said attorneys shall lawfully do by virtue hereof. „ , ^ Section 11. Any such sale or sales made under or by Sale to _ •’ divest Com- \drtue of this Indenture, whether under the power of sale pany of all right, title hereby granted and conferred or under or by virtue of and interest. ... judicial proceedings, shall operate to divest all right, title, interest, claim and demand whatsoever, either at law or in equity, of the Company, of, in and to the prop- erty so sold, and shall be a perpetual bar both at law and in equity, against the Company, its successors and as- signs, and against any and all persons claiming or who may claim the property sold, or any part thereof, from, through or under the Company, its successors or assign.^. Section 12. The receipt of the Trustee for the pur- Purcbaser cliase money shall be a sufficient discharge to any pur- need not see o •/ x Uon^of property, or any part thereof, sold as afore- chase money, said, and no such purchaser or liis representatives, grantees or assigns, after paying such purchase money and receiving such receipt, shall be bound to see to the application of such purchase money upon or for any trust or purpose of this Indenture, or in any manner whatso- ever be answerable for any loss, misapplication or non- application of such purchase money, or any part thereof, 69 or be bound to inquire as to the authorization, necessity, expediency or regularity of any such sale. Section 13. In case of any such sale, whether under Principal to the power of sale hereby granted or pursuant to judicial and payable proceedings, the principal of all the Bonds, if not pre- bSo? viously due, immediately thereupon shall become due and payable, anything in the Bonds or in this Indenture con- tained to the contrary notwithstanding. Section 14. The purchase money, proceeds and avails Application of any such sale, whether under the power of sale here- purchase ^ money, by granted or pursuant to judicial proceedings, together with any other sums which may then be held by the Trus- tee under any of the provisions of this Indenture as part of the trust estate, or the proceeds thereof, and any other moneys collected, received or held by the Trus- tee for the benefit of the holders of the Bonds shall be applied as follows: (a) to the payment of the costs and expenses of such sale, including reasonable compensation to the Trustee, its agents, attorneys and counsel and of all expenses, liabilities and advances made or incurred by the Trustee hereunder ; (b) to the payment of the whole amount then owing and unpaid upon the Bonds for principal and interest, with interest at the rate of seven per cent, per annum on the overdue principal and instalments of interest; and in case such pro- ceeds shall be insufiicient to pay in full the whole amount so due and unpaid upon the Bonds, then to the payment of such principal and interest, without preference or priority of principal over interest or of interest over principal or of any instalment of interest over any other instalment 70 of interest, ratably to the aggregate of such prin- cipal and the accrued and unpaid interest, (subject however, to the provisions of Section 3 of Article IV hereof and of Section 1 of this Article VI), ac- cording to the amounts due and payable upon the Bonds and coupons respectively, at the rate fixed by the Trustee for the distribution of such moneys, upon presentation of the several Bonds and cou- pons, and stamping thereon such payment if only partial, and cancelling the same when fuUy paid. (c) to the payment of the surplus, if any, upon its or their written demand, to the Company, its successors or assigns, or to whomsoever may be lawfully entitled to receive the same. Purchaser may apply Bonds and matured coupons. Section 15. Upon any such sale, any purchaser, for the purpose of making settlement or payment for the property purchased, shall be entitled to use and apply any Bonds and any matured and unpaid coupons thereto appertaining after such Bonds and coupons have been presented to the Trustee for crediting thereon the sums applicable to the payment thereof out of the net proceeds of such sale to the holder of such Bonds and coupons as his ratable share of such net proceeds, after the deduction of costs, expenses, compensation and other charges ; such purchasers shall be credited on account of the purchase price of the property purchased with said sums so pay- able out of said net proceeds on the Bonds and coupons so presented, and at any such sale any Bondholder or any other person may appear and Durchase such property and may make payment therefor, as aforesaid, and upon com- pliance with the terms of sale, may hold, retain and dis- 71 pose of such property without further accountability therefor. Section 16. In case (1) default shall be made in the payment of any instalment of interest on any of the Bonds Judgment ^ for prmci- when and as the same shall become payable, as pal interest therein and herein expressed, and such default Fund pay- ments. shall have continued for thirty days ; or (2) default shall be made in the payment of any instalment of the Sinking Fund herein pro- vided for and such default shall have continued for thirty days; or (3) default shall be made in the payment of the principal of any of the Bonds when and as the same shall become payable, either at maturity or by declaration or otherwise; then, upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Bonds and coupons then outstanding, the whole amount that then shall have become due and payable on all such Bonds and coupons then outstanding, for interest or principal, or both, or will pay to the Trustee the amount of all pay- ments due in respect of the Sinking Fund, as the case may be, with interest in each instance at the rate of seven per cent, per annum upon the overdue principal, instalments of interest or payments due in respect to the Sinking Fund, all without deduction and subject to re- imbursement for taxes as provided in Sections 1 and 2 of Article IV hereof ; and, in addition thereto, such further amount as shall be sufficient to cover the costs and ex- penses of collection, including a reasonable compensa- tion to the Trustee, its agents, attorneys and counsel and any expenses or liabilities incurred by the Trustee here- under; and, in case the Company shall fail to pay the same forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be en- titled to recover judgment for the whole amount so due and unpaid. The Trustee shall be entitled to recover judgment as aforesaid, either before or after or during the pendency of any proceedings for the enforcement of the hen of this Indenture upon the trust estate, and the right of the Trus- tee to recover such judgment shall not be affected by any sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the provisions of this Indenture or the foreclosure of the lien hereof ; and in the case of a sale of the trust estate, and of the application of the proceeds of sale to the payment of the debt, the Trustee, in its own name, and as trustee of an express trust, shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid upon any and all of the Bonds then outstanding, for the benefit of the holders thereof, and shall be entitled to re- cover judgment for any portion of the debt remaining unpaid, with interest. No recovery of any such judgment by the Trustee, and no levy of any execution upon any such judgment upon property subject to the lien of this Indenture, or upon any other property, shall in any man- ner or to any extent affect the lien of the Trustee upon the trust estate or any part thereof, or any rights, pow- ers or remedies of the Trustee hereunder, or any rights, powers or remedies of the holders of the Bonds, but such 73 lien, rights, powers and remedies shall continue unim- paired as before. Any moneys collected by the Trustee under this Sec- Application of moneys tion 16 (except any moneys collected in respect of the recovered. Sinking Fund) shall be applied by the Trustee towards payment of amounts then due and unpaid upon the Bonds and coupons respectively, ratably and without any pref- erence or priority of any kind, except as provided in Section 3 of Article IV land Section 1 of this Article VI, according to the amounts due and payable upon the Bonds and coupons respectively, at the date fixed by the Trust- ee for the distribution of such moneys, upon presenta- tion of the several Bonds and coupons, at any of the places at which the Bonds are expressed to be payable, and stamping thereon such payment if only partial, and cancelling the same when fully paid. Any moneys collected by the Trustee under this Sec- tion 16 in respect to the Sinkmg Fund shall be applied by the Trustee as provided in Articles II and III of this Indenture. Section 17. The Company will not at any time insist waiver of upon or plead, or in any manner whatever claim or takoappra^- the benefit or advantage of, any stay or extension la\v“^* now or at any time hereafter in force, nor will it claim, take or insist on any benefit or advantage from any law now or hereafter in force providing for the valua- tion cr appraisement of the trust estate, or any part there- of, prior to any sale or sales thereof to be made pursuant to any provision herein contained or to the decree of any court of competent jurisdiction; nor after any such sale or sales will it claim or exercise any right under any stat- ute enacted by the Dominion of Canada or any 74 Holders of Bonds can- not enforce security, unless Tnistee re- quested to act and offered satisfactory indemnity. Province thereof, or otherwise, to redeem the prop- erty so sold or any part thereof, and it hereby ex- pressly waives all benefit and advantage of any such law or laws ; and it covenants that it will not hinder, delay or impede the execution of any power herein granted and delegated to the Trustee, but that it will suffer and permit the execution of every such power as though no such law or laws had been made or enacted. Sectiox, 18. No holder of any Bond or coupon shall have any right to institute any suit, action or proceeding in equity or at law for the foreclosure of this Indenture or for the execution of any trust hereof or for the ap- pointment of a receiver hereunder, or for any other rem- edy hereunder, unless the holders of at least fifteen per cent, in amount of the Bonds outstanding shall have given to the Trustee written notice of some event of de- fault and of the continuance thereof; nor unless the Trustee shall have been requested in writing by the hold- ers of one-fourth in amount of the Bonds then outstand- ing or by an extraordinary resolution passed at a meet- ing of the Bondholders in accordance with Schedule A, to take action in respect of the matter complained of, and shall have afforded to the Trustee a rea- sonable opportunity either to proceed to exercise the powers hereinbefore granted, or to institute such action, suit or proceeding in its cwn name; nor un- less also such Bondholders shall have offered to the Trustee security and indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred therein or thereby; nor unless the Trustee for thirty days after receipt of such notification, request and offer of indemnity, shall have refused or neglected to 75 act on such notice, request and indemnity ; and such noti- fication, request and offer of indemnity are hereby de- clared, in every sucli case, at the option of the Trustee, to be conditions precedent to the execution of the powers and trusts of this Indenture and to the availability and the commencement and prosecution of any action or suit here- under, whether for foreclosure or for the appointment of a receiver or for any other remedy; and it is ex- pressly declared and intended that no one or more holders of Bonds or coupons shall have any right in any manner whatever to affect, disturb or prejudice the lien of this Indenture by his or their action, or to enforce any right hereunder, except in the manner herein provided, and that all proceedings hereunder, at law or in equity, shall be instituted, had and maintained in the manner herein provided and for the equal benefit of all holders of such outstanding Bonds and coupons, except as provided in Section 3 of Article IV and Section 1 of this Article VI. Nothing in this Section or elsewhere in this Indenture Holder has tib solute or in the Bonds or in the coupons attached thereto shall right to sue affect or impair the obligation of the Company, which and ^nTeTest! is unconditional and absolute, to pay the principal and interest of the Bonds to the respective holders of the Bonds and to the respective holders of the coupons at- tached thereto, at the respective due dates in such Bonds and coupons stated, nor affect or impair the right of ac- tion, which is also absolute and unconditional, of such holders to enforce such payment. Section 19. Except as herein expressly provided to Kemedies to i-i 1 ii* t)© cuinxi* the contrary, no remedy herein conierred upon or re-[ative. served to the Trustee, or to the holders of Bonds, is in- tended to be exclusive of any other remedy, but each and 76 No delay oi omission by Trustee to constitute a waiver. Abandon- ment of an action not to affect subse- quent de- faults. Notice of distributions to Bond- holders. every such remedy shall be cumulative and in addition to every other remedy given hereunder or now or hereafter available at law or in equity or by statute. Section 20. No delay or omission of the Trustee or of any holder of Bonds to exercise any right or power accruing upon any event of default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein; and every power and remedy given by this Indenture to the Trustee or to the Bondholders may be exercised from time to time and as often as may be deemed expedient by the Trustee or by the Bondholders. Section 21. In case the Trustee shall have proceeded to enforce any right under this Indenture by foreclosure, sale or otherwise, and such proceeding shall have been discontinued or abandoned because of any waiver, or for any other reason, or shall have been determined adversely to the Trustee, then and in eveiy such case the Company and the Trustee shall be restored to their former posi- tions and rights hereunder in respect to the trust estate, and all rights, remedies and powers of the Trustee shall continue as though no such proceedings had been taken ; but no such waiver, discontinuance, abandonment or de- termination shall extend to or affect any subsequent de- fault, or impair any right consequent thereon. Section 22. The Trustee shall give notice by publica- tion in one daily newspaper of general circulation pub- lished in the City of Montreal in the Dominion of Canada and in a daily newspaper of general circulation published in the City of Toronto in said Dominion and in a daily 77 newspaper of general circulation published in the Borough of Manhattan, City and State of New York of the day, place and time fixed for any distribution to the Bondholders under the provisions of this Article, and after the day so fixed the interest on the amount oif principal and/or interest so distributable on account of the Bonds shall cease from the date so fixed and in the case of only partial payment the Bonds shall be deem- ed discharged in the amount stamped thereon in ac- cordance with the provisions of this Article. Section 23. Upon the happening of one or more of Trustee may apply for the events of default specified in Section 2 of this Article, Court order, the Trustee may apply to the Superior Court for the District of Montreal or to any one of the Judges thereof for an order that the trusts hereof be carried into ex- ecution under the direction of the Court and for any other order in relation to the administration of the trusts hereof that the Trustee shall deem expedient, and the Trustee may assent to or support any application to the Court made at the instance of Bondholders in accordance with the provisions of this Indenture or at the instance of holders of Debenture Stock and/or 5% Bonds, but the Trustee shall not be required to take any such action unless indemnified to its satisfaction against all costs, charges and expenses which the Trustee may incur in connection therewith. Section 24. All rights of action under this Inden- Trustee may ture, or under any of the Bonds or coupons, may be en- possession forced by the Trustee without the possession of any of ^d^coupona. the Bonds or coupons or the production thereof on any trial or other proceedings relative thereto, and any such 78 suit or proceedings instituted by the Trustee shall be brought in its name as Trustee, and any recovery of judgment shall be for the equal benefit of the holders of the Bonds and coupons, except as provided in Section 3 of Article IV and Section 1 of tliis Article VI. rnay'^i’nsfract ^^CTiox 25. The holders of a majority in amount of Trustee. the Boiids from time to time outstanding by instrument in writing delivered to the Trustee or the Bondholders by an extraordinary resolution passed at a meeting of the Bond- holders in accordance with Schedule A, shall have the right to determine which of the remedies herein set forth shall be adopted and to direct the method and place of conducting all proceedings to be taken under the provi- sions of this Indenture for the enforcement thereof or of the Bonds or of the trust estate. Waiver of defaulti. Section 26. The Trustee may from time to time when- ever it shall deem it expedient in the interests of Bond- holders waive, with or without terms and conditions, any and all defaults of the Company under this Inden- ture, or under the Bonds, or under the Trust Deed, or under the Debenture Stock and/or 5% Bonds, save and except the covenant to pay the principal and interest thereof at maturity ; and shall likewise waive any and all such defaults (with such exception) upon request in writ- ing of a majority in amount of the Bonds then outstand- ing or by an extraordinary resolution passed at a meet- ing of the Bondholders in accordance with Schedule A, and upon such terms and conditions if any as may be specified in such writing or resolution, as the case may be, and upon being indemnified to its satisfaction against any expense, loss or damage which the Trustee may incur in connection with compliance ivitli this Section. 79 ARTICLE VII. Supplemental, Indentures. Section 1. In addition to any supplemental indenture, otherwise authorized by this Indenture, the Company, tures. when authorized by resolution of its Board of Directors, and the Trustee, from time to time and at any time, subject to the conditions and restrictions in this Inden- ture contained, may enter into an indenture or indentures supplemental hereto as shall not he inconsistent with the terms and provisions of this Indenture, or in conflict with the rights of holders of Bonds, and which supple- mental indenture or indentures thereafter shall form a part hereof, for any one or more of the following pur- poses, among others : {a) To add to the conditions, limitations and restrictions on the terms, provisions, purposes of issue, authentication and delivery of Bonds, fur- ther and additional conditions, limitations and re- strictions thereafter to be observed. (&) To add to the covenants and agreements of the Company in this Indenture contained, further and additional covenants and conditions thereafter to be observed. (c) To evidence the succession of another cor- poration to the Company, or successive succes- sions, and the assumption by a successor corpora- tion of the covenants and obligations of the Com- pany in the Bonds hereby secured and in this Indenture and in any and every supplemental in- denture contained. (d) To hypothecate, pledge, transfer and as- sign to the Trustee, and to subject to the lien of this Indenture, with the same force and effect as though included in the granting clauses hereof, additional securities and properties intended here- by to become subject to . the lien of this Indenture or if the Company shall determine to subject the same to the lien of this Indenture for any of the purposes hereof. (e) To evidence the appointment of an addi- tional or associate trustee or trustees or successor trustee or trustees as in this Indenture provided. (/) To make such provisions, not inconsistent with the terms and provisions of this Indenture or in conflict with the rights of holders of Bonds, as may be desirable in regard to all matters or questions arising under this Indenture. Trustee to join in sup- plemental indentures. Section 2. The Trustee is hereby authorized to join with the Company in the execution and delivery of any supplemental indenture authorized or permitted by the provisions of this Indenture and to make the further agreements and stipulations which may be therein con- tained. 81 ARTICLE VIII. IMMUNITY OF STOCKHOLDERS, OFFICERS AND DIRECTORS. No recourse shall be had for the payment of the Bonds stockhoid- ©rs ofiicGrs or the interest thereon against any stockholder, share-and directors holder, officer or director, past, present or future, of the muni ™ . Company, as such, either directly or through tlie Com- pany by virtue of any 'constitution, statute or rule of law or the enforcement of any assessment or otherAvise; such liability of stockholders, shareholders, directors or officers, as such, being released by the holders of the Bonds byl the acceptance of the Bonds and being also waived and released by the tenns of this Indenture. ARTICLE IX. METHODS OF PROOF. Section 1. Any request, direction or other instrument^ , required by this Indenture to be signed and executed by executed by ^ J ^ Bondholders Bondholders, may be in any number of concurrent writ- may be in any number ings of similar tenor, and may be signed or executed by of countor- . parts. such Bondholders, in person, or by agent appomted in writing. Proof of the execution of any such request, direction or other instrument, or of the writing appoint- ing any such agent, and of the ownership of Bonds trans- ferable by delivery, if made in the following maimer shall be sufficient for any purpose of this Indenture, and shall be conclusive in favor of the Trustee with regard to due action by it taken under such request: Instruments to be ac- knowledged. Ownership to be proved by certificate of deposi- tary. Registry. 82 (a) The fact and date of the signing or execu- tion by any person of any such writing may he proved by the certificate of any officer in any juris- diction, who by the laws thereof has power to take acknowledgments within said jurisdiction, that the person signing such writing acknowledged be- fore him the execution thereof, or by an affidavit of a witness of such execution. (b) The fact of ownership by any Bondholder of Bonds not registered as to principal and the amount and number of any such Bonds and the date of his ownership of the same may be prov- ed by a certificate executed by any trust company, bank, bankers, or other depositary (wherever- situated), if such certificate shall be deemed by the Trustee to be satisfactory, showing that at the date therein mentioned such person had on de- posit with such trust company, bank, bankers or other depositary the Bonds described in such cer- tificate; and such ownership may be deemed by the Trustee to continue until written notice to the contrary is served upon the Trustee. (c) The ownership of Bonds registered as to principal shall be proved by the register of said Bonds. Evidence of Bond- holders’ resolutions. Section 2. Wlienever under the terms and provisions of this Indenture reference is made to an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A, evidence of the passage of any such resolution given in the manner set forth in Section 19 of Schedule A shall be sufficient for all pur- 83 poses of this Indenture and shall be conclusive in favor of the Trustee and any one else relying thereon with regard to due action taken thereunder or pursuant there- to. Section 3. The provisions contained in Schedule A Action of shall have effect and be binding in the same manner as binding, if such provisions were herein set forth in full, and all writings given by the required amount of Bondholders specified in this Indenture and all extraordinary resolu- tions passed at a meeting of the Bondliolders as pro- vided in Schedule A shall be conclusive and binding upon all the Bondholders whether or not they shall have signed such writings or participated in the passing of such reso- lution to all intent and purposes the same as if such writings had been given and such resolutions liad been passed by the Bondholders unanimously. ARTICLE X. The Trustee. Section 1. The Trustee accepts the trusts of this In- Trustee accepts on denture and agrees to execute them upon the following condition: terms and conditions, to which the parties mutually agree : . {a) The Trustee shall not be obligated to pro-— not to record. cure the recordation, registration or filing of the Indenture or any particulars with regard thereto (6) The Company will, during the continuance— Trustee's remunera- of this security pay to the Trustee for the time tion. being of these presents, such reasonable remunera- tion for its services as Trustee as may be agreed upon between the Trustee and the Company, and the Company will also pay all costs, charges and 84 expenses properly incurred by the Trustee in con- nection with the trusts hereof, and also (in addi- tion to any rights of indemnity by law given to the Trustee) will at all times keep indemnified the Trustee against all actions, proceedings, costs, claims and demands in respect of any matter or thing done or omitted by it in any wise relating to these presents. The Trustee may make any agreements or arrangements with the Board of Directors of the Company as to the remuneration to be paid to the Trustee hereunder. All costs, charges and expenses incurred, and all payments made by the Trustee in the lawful exer- cise of the powers hereby conferred upon it, in- cluding all remuneration payable to the Trustee, shall be payable by the Company on demand, and shall carry interest at six per cent, per annum from the date of the same being incurred or becom- ing due, and all such costs, charges and expenses and payments, and all interest thereon, and all re- muneration payable to the Trustee hereunder, shall be an additional lien and charge upon the mortgaged premises and shall be satisfied before any payment is made thereout to the Bond- holders. Said remuneration shall continue payable mitil the trusts hereof shall be finally wound up, and whether or not a receiver or receivers or receiver and manager, or liquidator or sequestrator shall have been appointed, or the trusts of these presents shall be in course of administration by or undei the direction of the Court. Provided in defaub 85 of arrangement the remuneration may he fixed by a Judge of the Superior Court or High Court or Justice for any of the Provinces of Canada in which the property of the Company is situated. (c) The Trustee shall be under no obligation to— to be un- . der no duty recognize any person or persons, firm or corpora- tin notified tion, as the holder or holders of any of the Bonds, fied. or to do or refrain from doing any act pursuant to the request or demand of any person or persons, firm or corporation, professing or claiming to be such holder or holders of any of the Bonds, until such person or persons, firm or corporation, shall have produced the Bond or Bonds of which he, they or it claim to bo the holder, or other evidence of such holding satisfactory to the Trustee and shall have also indemnified the Trustee, to its reasonable satisfaction, against any and all costs, expenses and outlays, counsel fees and other proper dis- bursements, and any other liability growing out of the compliance by the Trustee with such request or demand. (d) The Trustee may employ agents or attor-— not an- noys in fact, and shall not be answerable for the de- nilsconduct fault or misconduct of any agent or attorney ap-°^ agents, pointed by it in pursuance hereof if such agent or attorney shall have been selected with reasonable care. The Trustee shall be liable only for gross negligence or wilful or intentional default in the execution of any duty or trust under this Inden- ture. 86 — not re- sponsible for recitals or for valid- ity of Bonds and this Inden- ture. — may as- sume no default till notified by 15% of Bond- holders. — protected in acting on notice, etc. (e) The Trustee shall not he responsible in any manner whatsoever for the recitals herein or in the Bonds or the appurtenant coupons contained as to the acts or powers of the Company all of which are made by the Company solely. The Trustee shall not be responsible for, or in respect of, the validity or sufficiency of this Indenture, or the ex- ecution hereof by the Company, or for the validity of the Bonds issued hereunder. (/) Unless and until the Trustee shall have re- ceived written notice to the contrary from the hold- ers of not less than fifteen per cent, in amount of the Bonds outstanding, or by extraordinary reso- lution passed at a meeting of the Bondholders in accordance with Schedule A, the Trustee may as- sume that for the purposes of this Indenture no default has been made by the Company in the payment of any of the Bonds or of the interest thereon or in the observance or performance of any of the covenants contained in the Bonds or in this Indenture and that none of the events of default has happened. {g) The Trustee shall be protected in acting upon any notice, request, consent, certificate, affi- davit, resolution or other paper or document be- lieved by it to be genuine and to be signed or certified to by the person therein stated to be familiar with the facts therein set forth, and shall incur no liability for any such action. 87 (h) The Trustee in its individual capacity may —may ac- quire Bonds acquire Bonds with the same rights which it would in individual have if it were not the Trustee hereunder, capacity. (i) The Trustee may advise with counsel to be ^"^advice'^of selected and employed by it at the expense of the counsel. Company and shall be fully protected in respect of any action under this Indenture taken or suffered in good faith by the Trustee in accordance with the opinion of counsel. (j) The Trustee shall not be answerable for or —not per- sonally personally liable for any debts contracted by it or liable for debts etc. for any assessments or charges, or forany damages and to have . i p 1 e a lien for its to persons or property, or tor salary, or tor non- indemnifica- fulfillment of contracts, during the period wherein the Trustee shall hold and deal with the trust estate, and the trust estate and property is hereby charged with a first lien in favor of the Trustee for its security and indemnification against any such liability and against every liabil- ity of any kind which it may incur hereunder as weU as for compensation for its ser\dces and re- imbursement of all its expenses hereunder with interest. {k) Any certificate or request herein provided ^wtificate or permitted to be given by the Company to the how ex- ecuted. Trustee shall be sufficient if executed under the seal of the Company and signed by the president or any vice-president and by the secretary or any assist- ant secretary or treasurer or any assistant treas- urer of the Company. Any certified copy of a 88 — ^interest on deposits with Trus- tee. Safe keeping of trust estate. Freedom of Trustee to contract with Com- pany. resolution of the board of directors or executive committee herein provided or permitted to he given to the Trustee shall be sufficient evidence to the Trustee of the due adoption of the same if the sec- retary or any assistant secretary of the Company shall certify under the corporate seal of the Com- pany that such copy is a true and correct copy of a resolution or resolutions duly adopted by the board of directors or the executive committee of the Company, as the case may be, at a meeting thereof duly called and held and at which a quorum was present and acting. (l) The Trustee will pay to the Company from time to time interest on any cash balances held by the Trustee on deposit hereunder, at such rate as is customarily allowed by it on similar deposits. (m) The Trustee shall be at liberty to deposit the trust estate or any part thereof as from time to time constituted in a safe deposit box or safe, customarily used for such purposes, selected by the Trustee and the Trustee shall not be respon- sible for any loss incurred in connection with the trust estate so deposited, and the Trustee may pay and charge to the Company all sums required to be paid on account or in respect of any such deposit. (w) The Trustee may act as Eegistrar of the Bonds and Agent for making any payment on the Bonds, and the Trustee shall not by reason of its fiduciary relation hereunder be in any vase pre- cluded from making any contracts or entering into 89 any transactions with the Company in the ordi- nary course of business and without prejudice to the generality of this provision it is expressly declared that such contracts and transactions may include any contract or transaction in relation to the purchasing, underwriting, selling, placing or lend- ing money on security of any obligations of the Company, and the Trustee shall be in no wise accountable to the Company or to the Bondhold- ers for any profits resulting from any such con- tracts or transactions. (o) The Trustee shall not be required to give Trustee not security for its conduct or administration under give secur- ity this Indenture. Section 2. The Trustee or any successor to it in the Trustee may trust may resign and be discharged from the tinists created by this Indenture by giving to the Company no- tice in writing of such resignation, specifying a date when such resignation shall take effect, which notice shall be published at least once in each week for six successive weeks prior to the date so specified, in a daily newspaper of general circulation published in the City of Montreal, in the Dominion of Canada and in a daily newspaper of general circulation published in the City of Toronto in said Dominion and in a daily newspaper of general cir- culation published in the Borough of Manhattan in the City and State of New York, the first publication to be not less than sixty nor more than ninety days prior to the date so specified. Such resignation shall take effect on the day specified in such notice unless previously a successor Trustee shall be appointed as hereinafter pro- 90 vided, either by the Bondholders or by the Company, in which event such resignation shall take effect immedi- ately upon the appointment of such successor Trustee. Trustee may The Trustee at any time under this Indenture may be be removed. removed by an instrument in writing filed with such Trus- tee and executed by the holders of a majority in amount of the Bonds then outstanding or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A. may^'be SECTION 3. In caso at any time the Trustee or any filled tern- successor to it shall resign or be removed or shall other- porarily by ^ Company, wise become incapable of acting or for any cause a va- such ap- pointee to be cancy shall occur in the office of Trustee a successor by Trustee Trustee may be appointed by the holders of a majority ^omihoiderZ in amount of the Bonds then outstanding by an instru- ment or concurrent instruments in writing signed by such Bondholders or by their attorneys in fact thereunto duly authorized or by an extraordinary resolution passed at a meeting of the Bondholders in accordance with Schedule A; but until a new Trustee shall be appointed by the Bondholders as herein authorized the Company, by an instrument executed by order of its board of directors, may appoint a Trustee to fill such vacancy. The Com- pany shall publish notice of any such appointment by it made once in each week for four successive weeks in a daily newspaper of general circulation published in the City of Montreal, in the Dominion of Canada and in a daily newspaper of general circulation published in the City of Toronto in said Dominion and in a daily newspaper of general circulation published in the Borough of Manhattan in the City and State of New York; but any Trustee so appointed by the Company 91 shall immediately and without further act be superseded by a new Trustee or new Trustees appointed by the Bondholders. Section 4. Every successor trustee to the Trustee herein named, or its successors in the trust hereunder, shall be a trust company or bank having power so to act, in good standing, incorporated under the laws of the Dominion of Canada, and carrying on business in the City of Montreal, and having a capital and surplus ag- gregating at least two millions dollars. Section 5. Any new Trustee appointed hereunder shall execute, acknowledge and deliver to the Trustee last in office, and also to the Company, an instrument ac- cepting such appointment hereunder, and thereupon such new Trustee without any further act or writing shall be- come fully vested with all the estates, properties, rights, powers, trusts, duties and obligations of its predecessors in the trust, with like effect as if originally named as Trustee herein; but the Trustee ceasing to act, shall nevertheless, on the written request of the Company, or of the new Trustee, and at the Company’s expense, exe- cute and deliver an instrument transferring to such new Trustee, upon the trusts herein expressed, all the estates, properties, rights, powers and trusts of the Trustee so ceasing to act, and shall duly assign, transfer and deliver all property and money held by it to the new Trustee, it being understood that any securities, cash and other property, the custody of which is given to the Trustee herein named, shall always be in the custody of its suc- cessor in the trust hereunder as herein provided. Should any deed, conveyance or instrument in writing from the Successor Trustee. Successor to accept trusts and to be vested with rights. 92 Company be required by the new Trustee for more fully and certainly vesting in and confirming to such new Trustee such estates, rights, powers and duties, any and all such deeds, conveyances and instruments in writing shall, on request, be executed, acknowledged and delivered by the Company. Section 6. Any corporation into which the Trustee under this Indenture, original or successor, may be merged or with which it may be consolidated, or any cor- poration resulting from any merger or consolidation to which such Trustee shall be a party, shall be the succes- sor of the Trustee under this Indenture without the exe- cution or filing of any paper or any further act on the part of the parties hereto, provided such corporation is organized under the laws of the Dominion of Canada, carries on business in the City of Montreal in said Dominion, and has a capital and surplus aggregating at least two million dollars. Authentiea- SECTION 7. Ill case any of the Bonds shall have been cesson^ authenticated, but not delivered, any such successor Trus- tee may adopt the certificate of authentication of Montreal Trust Company, or of any successor to it, as Trustee hereunder, and deliver the same so authenticated, and in case any of the Bonds shall not have been authen- ticated, any successor Trustee may authenticate such Bonds either in the name of any predecessor Trustee or in the name of such successor Timstee; and in all such cases, such certificates shall have the full force which it is anywhere in the Bonds or in this Indenture provided that the certificate of the Trustee sliall have. Merger or consolida- tion of Trustee. 93 Section 8. At any time or times, in order to conform Company and Trustee to any legal requirements, restrictions, or conditions in may appoint any locality or jurisdiction in which any part ot the Trustee to property then subject to this Indenture shall he located, arateiy or the Company and the Trustee shall have power to ap- Tras^tee. point, and shall unite in the execution, delivery and per- fonnance of all instruments and agreements necessary or proper to appoint, another trust company or one or more persons, approved by the Trustee, either to act as separate trustee or trustees or co-trustee or co-trustees of all or any of the projierty subject to the lien hereof, jointly with the Trustee originally named herein, or its successors, or to act as separate trustee or tnistees, of any such property. Section 9. Every separate trustee, every co-trustee and every successor trustee, other than any trust com- pany Avhicli may be apijointed as successor to Montreal Trust Company, shall, to the extent permitted by law, be appointed subject to the following provisions and condi- tions, namely: (1) The Bonds secured hereby shall be authen- Montreal ^ _ _ Trust Com- ticated and delivered, and all powers, duties, obli- pany or its successor to gations and rights, conferred upon the Trustee in authenticate Bonds; respect of the custody of all trust estate, shall be exercised solely by Montreal Trust Company or a trust company appointed or acting as its suc- cessor in the trust hereunder ; (2) No power shall be exercised hereunder by its consent necessary to such separate trustee or trustees or co-trustee or exercise of co-trustees, or successor or successors thereto. ex-^°^^^’ 94 cept jointly with the consent in writing of Montreal Trust Company or any trust companj^ which may have been appointed or he acting as its successor in the trust; and (3) The Company, or any successor company, and Montreal Trust Company or its successor in the trust, at any time by an instrument in writing executed by them jointly, may remove any other trustee or co-trustee, and may likewise and in like manner appoint a successor to such trustee or co- trustee so removed, anything herein contained to the contrary notwithstanding. Notices may SECTION 10. Aliy iiotice, request or other writing or be served on ^ Montreal resolution by or on belialf of the holders of tlie Bonds Trust Com- -it, pany. delivered solely to Montreal Trust Company, or its successor in the trust, shall be deemed to have been delivered to all of the then trustees as effectually as if delivered to each of them. Everj^ instrument appointing any trustee or trustees other than a successor to Montreal Trust Company shall Associate to accept refer to this Indenture and the conditions in this Article trusts. ... expressed, and upon the acceptance in writing by such trustee or trustees, he, they or it shall he vested with the estates or property specified in such instrument, either jointly with Montreal Trust Company, or its successor, or separately, as may he pro\’ided, subject to all the trusts, conditions and provisions of this Indenture; and every such instrument shall be filed with Montreal Trust Company or its successor in the trust. Any separate trustee or trustees or any co-trustee or co-trustees may at any time by an instrument in writing constitute Montreal Trust Company or its successors in the trust it to have power to re- move asso- ciate Trustee. 95 hereunder his, their or its agent or attorney-in-fact, with full power and authority, to the extent which may be au- thorized by law, to do all acts and tilings and exercise all discretion authorized or permitted by him, them or it, for and in behalf of him, them or it, and in his, their or its name. In case any separate trustee or trustees or co-trustee or co-trustees, or a successor to either of them, shall die, become incapable of acting, resign, or be removed, all the estates, property, rights, powers, trusts, duties and obligations of said separate trustee or co- trustee, so far as pennitted by law, shall vest in and be exercised by the Montreal Trust Company or its succes- sor in the trust, witliout the appointment of a new trustee as successor to such separate trustee or co-trustee; and no successor to any separate trustee or co-trustee shall be appointed unless such appointment shall be necessary for the full protection of the holders of the Bonds. ARTICToE XI. Defeasance. Section 1. If, when the Bonds shall have become due^p^j^ p^^^. and payable, either at maturity, when called for redemp- tion, by declaration or otherwise, the Company shall well°^ and truly pay or cause to be paid the whole amount due Trustee to return prop- on all Bonds and coupons then outstanding for principal erty and ex- ecute satis- (and premium if any) and interest, or at any time shall faction piece. deliver to the Trustee for cancellation all of the outstand- ing Bonds and coupons, and also shall pay or cause to be paid all of the sums payable hereunder by the Company, and shall well and truly keep and perform all of the things herein required to be kept and performed by it ae 96 Company may con- solidate. cording to the true intent and meaning of this Indenture, then and in that case the Trustee shall without further action on the part of the Company assign, transfer and deliver to the Company, or to any other jierson, firm or corporation, by the Company designated to receive the same, which designation shall he hy resolution of the board of directors of the Company, a certified copy of which shall he delivered to the Trustee hereunder, all trust estate or proceeds thereof which may be held by it as Trustee hereunder, and all property, tangible and in- tangible, rights and interest hereby conveyed or pledged, or which may hereafter bo conveyed or pledged, shall revert to the Company and the estate, rights, title and interest of the Trustee shah thereupon cease, determine and become void, and the Trustee in such case, on de- mand of the Company, at its cost and expense, shall exe- cute proper instruments acknowledging satisfaction of this Indenture. ARTICLE XII. Concerning Consolidation, Merger and Sale, Section 1. Nothing in this Indenture contained shall prevent the consolidation or merger of the Company with or into any other corporation, or prevent any consolida- tion or merger with or into the Company, of any other corporation, or prevent the sale by the Company of its property as an entirety, provided that any such consoli- dation, merger or sale, shall be subject to the lien of this Indenture and on such terms as to preserve and not to impair the lien or security thereof, or any of the rights and powers of the Trustee or of the holders of the Bonds, and that any successor corporation formed by or result- 97 ing from such consolidation or merger, or any corpora- tion to which such sale shall be made, shall, as a part and condition of such consolidation or merger, and as a part of the purchase price for the sale of the property of the Company as an entirety, expressly assume in writing the due and punctual payment of the principal and interest of all the Bonds, and the observance and performance of all the covenants and conditions of this Indenture, and shall, simultaneously with the consummation of such con- solidation, merger or sale, or simultaneously with the de- livery to it of the conveyances for the property of the Company as an entirety, if such conveyances be delivered prior to the consummation of such consolidation, merger or sale, execute and deliver to the Trustee a proper in- denture, in form satisfactory to the Trustee, whereby such corporation fonned by or resulting from such con- solidation or merger or such corporation to whom such sale shall be made, shall so assume the due and punctual payment of the principal and interest of all the Bonds, and the observance of all the covenants and conditions of this Indenture and charge therewith the trust estate taken over. Section 2. In case the Company shall he so consoli- consolidated dated with or merged into any other corporation, or in asS^^obit case any corporation shall be consolidated with or merged into the Company as aforesaid, or in case of a sale of the •Venture, property of the Company as an entirety, the corporation formed by or resulting from such consolidation or mer- ger, to w'hich such sale shall have been made, upon exe- cuting and causing to be delivered an indenture to the Trustee, whereby such corporation shall assume the due and punctual payment of the principal of, and interest 98 Company’s successors and assigns bound. on, all the Bonds then or at any time thereafter outstand- ing, or herein provided to be issued, and the performance of all the covenants and conditions of this Indenture, and shall charge therewith the properties taken over, shall succeed to and be substituted for the Company, with the same effect as if it had been named herein as party of the first part hereto, and such corporation may thereupon, subject to the provisions hereof, cause to be signed and sealed, and may issue, either in its own name or in the name of the Company, any or aU of the Bonds which shall not theretofore have been signed and sealed by the Com- pany and delivered to the Trustee, and upon the order of such corporation, in lieu of the Company, and subject to all the terms, conditions and restrictions herein pre- scribed, the Trustee shall authenticate any and all Bonds which shall have been previously signed and sealed by the officers of the Company, and delivered to the Trustee for authentication, and any of such Bonds which such corporation shall thereafter cause to be signed and sealed and delivered to the Trustee for that purpose, and de- liver the same to such corporation or upon its order. All Bonds so issued shall in all respects have the same legal security rank and validity as the Bonds thereto- fore or thereafter issued in accordance with the terms of this Indenture as though all of the Bonds had been actu- ally issued by the Company as of the date of the execu- tion hereof. ARTICLE XIII. DeFIKITIONS and kllSCEULANEOUS PbOVISIONS. Section 1. All the covenants, stipulations, promises and agreements in this Indenture contained, by or in be- 99 half of the Company, shall bind its successors and as- signs, whether so expressed or not. Section 2. The word “Trustee” means the trustee to whom this Indenture is executed or its successor in the trust. The words “Tinstee,” “Bond,” “Bondholder” and “holder” shall include the plural as well as the sing- ular number, unless otherwise expressly indicated. The word “holder” means the bearer, or as to any registered Bond the registered owner. The word “coupons” refers to the interest coupons attached to the Bonds. The word “person” used with reference to a Bondholder, shall in- clude associations or corporations. The words “trust estate” shall, unless otherwise expressed or indicated, be held and construed to mean the property of the Com- pany of every kind and nature and all property and every right or interest which is or may become subject to the lien of this Indenture. The word “Company” includes and means not only the party of the first part hereto, but also its successors and assigns, including any corpora- tion with which or into wlfich it may be consolidated or merged or to which it may sell its properties as an en- tirety for the purpose of reincorporation. The words “Trust Deed” include and mean any and all supple- ments hereafter made to the Trust Deed in accordance with the provisions thereof, as well as any supplements heretofore made to the Trust Deed of 1913 hereinbefore specifically mentioned. The words “Trustees under the Trust Deed” shall include and mean Prudential Trust Company Limited and/or Royal Exchange Assur- ance, as the case may be, whenever rights, powers or duties are conferred upon or given to them or either or both of them under the Trust Deed. Definitions. 100 This inden- SECTION 3. Ill Order to facilitate the recording, films: ture executed ° in several and/or registering of this Indenlture, the same may be counter- parts. executed in several comiterparts, each of which shall be deemed an original; and such counterparts shall consti- tute but one and the same instrument. hereby ^cra- Section 4. Nothing in this Indenture, expressed or t erred only implied, is intended or shall be construed to confer unon, on ]>artie9 ^ ^ hereto and or to give to, any person or corporation, other than the Bonds. parties hereto and the holders of the Bonds, any right, remedy or claim, under or by reason of this Indenture, or any covenant, condition, stipulation or agreement hereof ; and all the covenants, stipulations, promises and agreements in this Indenture contained by or on behalf of the Company shall be for the sole and exclusive benefit of the parties hereto and of the holders of the Bonds. Notices to Company. Testi- monium. Section 5, Any and all notices provided to be given under the terms of this Indenture to the Company shall be deemed duly given when placed in a sealed envelope postage prepaid and addressed to the Company at its principal office in the City of Montreal, Dominion of Canada or at such other place in said City of Montreal as the Company may from time to time designate in a writ- ing addressed and delivered personally to the Trustee at its principal office in said City of Montreal. In witness whereof, Canada Steamship Lines, Lim- ited, has caused this Indenture to be signed by its Presi- dent or a Vice-President and its corporate seal to be hereunto affixed and attested by its Secretary or an Assistant Secretary, and Montreal Trust Company has caused this Indenture to be signed by one of its Directors 101 and by the Manager and its corporate seal to be here- unto affixed, as of the day and year first above written. [ Seal of Canada Steamship Lines, Limited, Canada Steamship Lines, Limited ] by J. W. Norcross, Vice President. F. Percy Smith, Secretary. Signed, sealed and delivered by 1 Canada Steamship Lines, Limited, > in the presence of: ) F. S. ISARD R. B. Thomson [ Seal of Montreal Trust Company ] Montreal. Trust Company, by F. G. Donaldson, a Director. W. S. Greene, the Manager. Signed, sealed and delivered by Mon- treal Trust Company, in the pres- ence of: M. R. Byrne 103 SCHEDULE A Meeting op Bondholdeks 1. Canada Steamship Lines, Limited (herein called Meeting of “Company”) and Montbeax. Trust Company (herein called “Trustee”), the parties to the foregoing Indenture, dated as of the first day of May, 1922, may re- spectively at any time convene a meeting of the Bondholders which shall be held in the Borough of Manhattan, in the City and State of New York, unless the Trustee and the Company, with the writ- ten consent of holders of at least one-fourth in amount of the Bonds described in the Indenture at any time out- standing agree that same be held elsewhere. Wlienever the Company is about to convene any such meeting it shall foi'thwith give notice in writing to the Trustee of the place, date and hour tliereof and of the general na- ture of the business to be transacted thereat. The Tnis- tee shall call a meeting of Bondliolders at any time upon a requisition in writing of the holders of one-fourth or more in amount of Bonds for the time being outstanding. 2. At least ten days notice to the Bondliolders specify- ing the place, day and hour of the meeting and the general bondholders, nature of the business to be transacted thereat shall be given previously to any meeting of the Bondholders. Such notice shall be given by the Company or by the Trustee by publication in one daily newspaper of gen- eral circulation published in the Borough of Manliattan, in the City and State of New York, United States of America, and in one daily newspaper of general circu- lation published in the City of Montreal, Dominion of Canada, and in one daily newspaper of general circula 104 tion published in the City of Toronto, in said Dominion, at least twice in the ten days preceding the date for such meeting, (in each instance on any day of the week) and shall also cause a similar notice to be mailed first class postage prepaid at least ten days prior to the date for such meeting to each registered owner of Bonds whose address appears on the transfer register, but such mail- ing shall not be a condition precedent to the calling and holding of such meeting and failure so to' mail any such notice shall not affect the validity of the meeting or any proceedings had thereat. Quorum. s^^ch meeting persons present in person or by proxy and holding at least a majority in principal amount of the Bonds for the time being outstanding shall form a quorum for the transaction of business and no business shall be transacted at such meeting (other than the convening and adjournment thereof) unless the re- quisite quorum be present at the commencement of busi- ness. 4. Some person chosen by the Trustee shall be en- titled to take the chair at every such meeting and if no such person is nominated or if at any meeting the person nominated shall not be present within fifteen minutes after the time appointed for holding the meet- ing, the Bondlioldcrs present shall choose one of their number to be chairman. A secretary of the meeting may be similarly chosen. Trustee and 5. The Trustee and its solicitors or solicitor and any Directors of the Company may attend at any meeting of Bondholders. When g If within half an hour from the time appointed for quorum is