LOAN (CANADIAN DOLLARS).

No. 65 of 1955.

An Act to approve the Raising of a Loan in Canadian Currency, and for purposes connected therewith.

[Assented to 4th November, 1955].

BE it enacted by the Queen’s Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia, as follows:—

Short title.

1. This Act may be cited as the Loan (Canadian Dollars) Act 1955.

Commencement.

2. This Act shall come into operation on the day on which it receives the Royal Assent.

Definitions.

3. In this Act, unless the contrary intention appears—

“securities” means the securities referred to in sub-section (2.) of section five of this Act;

“the Loan Agreement” means the agreement referred to in the next succeeding section.

Approval of agreement.

4. The loan underwriting agreement made between the Commonwealth of the one part and Wood, Gundy & Company Limited of the other part, being the agreement set out in the First Schedule to this Act, is approved.

Approval of borrowing.

5.—(1.) The borrowing by the Treasurer, on behalf of the Commonwealth, of moneys not exceeding in the whole the sum of Fifteen million dollars, in Canadian currency, in accordance with the Loan Agreement, is approved.

(2.) The issuing of securities, in accordance with the form contained in the Second Schedule to this Act, in respect of the moneys so borrowed is approved.

Establishment of Canadian Loan Trust Account.

6.—(1.) For the purpose of this Act there shall be a Trust Account, to be known as the Canadian Loan Trust Account.

(2.) The Canadian Loan Trust Account is a Trust Account within the meaning of section sixty-two a of the Audit Act 1901-1955.

(3.) Moneys standing to the credit of the Canadian Loan Trust Account may be invested in securities of, or guaranteed by, the Government of the Commonwealth and interest received from any such investment may be paid to the credit of that Account.

Application of loan.

7. After payment of the expenses of the borrowing, the proceeds in Australian currency of the moneys borrowed under the Loan Agreement shall be paid to the credit of the Canadian Loan Trust Account and the Loan Fund is, to the necessary extent, appropriated accordingly.

Repayment of loan.

8.—(1.) The Treasurer shall, from time to time, from moneys standing to the credit of the Canadian Loan Trust Account—

(a) redeem moneys borrowed under the Loan Agreement in the manner provided in the securities; and

(b) retire moneys so borrowed in accordance with the provisions for a sinking fund contained in the securities.

(2.) Where moneys are so redeemed or retired, the securities issued in respect of those moneys shall be cancelled and shall not be re-issued.

National Debt Sinking Fund Act not to apply to loan.

9. The National Debt Sinking Fund Act 1923-1950 does not apply in relation to moneys borrowed under the Loan Agreement.

Payment of interest.

10. Interest payable on the moneys borrowed under the Loan Agreement shall be paid out of the Consolidated Revenue Fund, which is, to the necessary extent, appropriated accordingly.

THE SCHEDULES.

FIRST SCHEDULE. Section 4.

Loan Agreement.

WOOD, GUNDY & COMPANY Limited,

36 King Street West,

Toronto,

October 5th, 1955.

The Treasurer,

The Commonwealth of Australia,

Windsor Hotel,

Montreal, Quebec.

Dear Sir,

The undersigned hereby offers to purchase from the Commonwealth of Australia (hereinafter referred to as the “Commonwealth”) all but not part of the $15,000,000 principal amount of its 4% Fifteen Year Bonds dated November 1st, 1955, and due November 1st, 1970, (hereinafter referred to as the “Fifteen Year Bonds”) at the price of 96.50% of the principal amount thereof plus accrued interest to the date of delivery.

First Schedule—continued.

This offer is made upon the following terms and conditions:

1. The Commonwealth shall deliver to us not later than October 6th, 1955, a signed Prospectus (hereinafter referred to as the “Prospectus”) with respect to the Fifteen Year Bonds and with respect to the Commonwealth.

2. The Commonwealth, by acceptance of this offer, represents (except as to information furnished by us) that the Prospectus will not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances in which they are made, not misleading.

3. The cost of printing the Prospectus shall be paid by us. All legal expenses in connection with the issue of the Fifteen Year Bonds, including the expenses of our Counsel both in Canada and in Australia, shall be paid by the Commonwealth.

4. We shall take all steps required on our part under relevant statutes of such of the Provinces of Canada as we may designate to enable us or any other registered dealers lawfully to offer the Fifteen Year Bonds for sale to the public in such Provinces, and the Commonwealth shall diligently endeavour to furnish such proper information, if any, and to execute such proper instruments, if any, as may be necessary for this purpose.

5. The Fifteen Year Bonds shall, in the opinion of our Counsel, be investments in which the Canadian and British Insurance Companies Act states that companies registered under Part III thereof may, without availing themselves for that purpose of Subsection (4) of Section 63 of said Act, invest their funds.

6. The Commonwealth shall appoint The Royal Bank of Canada as agent of the Commonwealth for the purpose of paying interest and redemption premium, if any, on and principal of the Fifteen Year Bonds.

7. Our obligation to purchase and pay for the Fifteen Year Bonds shall be subject to the following conditions;

(a) after the date of the Prospectus and prior to the closing date there shall have been no material adverse change in the position of the Commonwealth, financial or otherwise, from that set forth in the Prospectus; and

(b) we shall have received the favourable opinion of our Counsel, Messrs. Tory, Miller, Thomson, Hicks, Arnold & Sedgewick, Toronto, (who may rely as to all matters of Australian law upon the opinion of Messrs. Blake & Riggall, Melbourne) to the effect that (i) this agreement has been duly authorized, executed and delivered by the Commonwealth and is a valid obligation of the Commonwealth in accordance with its terms; (ii) the creation, execution, issue, sale and delivery of the Fifteen Year Bonds have been properly executed by the Commonwealth and when delivered to and paid for by the undersigned, will be valid obligations of the Commonwealth in accordance with their terms; and (iii) under Canadian tax laws as currently in force, no tax is required to be withheld by the Canadian paying agent on interest payments to holders of the Fifteen Year Bonds who are non-residents of Canada.

8. Payment of the purchase price for the Fifteen Year Bonds shall be made by us at The Royal Bank of Canada in Toronto, Canada, by certified cheque or certified cheques payable in lawful money of Canada and drawn on a chartered bank or chartered banks payable at par in Toronto, Canada, to the order of the Commonwealth of Australia against the delivery of the Fifteen Year Bonds to us, partly at The Royal Bank of Canada, Toronto, Canada, and partly at The Royal Bank of Canada, Montreal, Canada, as we may request, such payment and delivery to be made at 10 a.m., Eastern Standard Time, on November 1st, 1955, or at such other time as may be agreed upon by us and the Commonwealth.

9. The Fifteen Year Bonds shall be delivered to us in definitive bearer form in denomination of $1.000, in such amounts and places aforesaid as we shall specify by notice in writing to the Commonwealth addressed to R. J. Gray, Treasury Officer, Australian Consulate General, 636 Fifth Avenue, New York 20, and delivered not later than October 24th, 1955.

10. The Commonwealth shall pay the cost of the preparation of the Fifteen Year Bonds and their transportation to the point or points of delivery specified in paragraph 8.

First Schedule—continued.

11. The Commonwealth shall indemnify and save us harmless from and against all claims, damages or liabilities to which we may be subjected and all losses (exclusive of loss of profits) which we may suffer, whether under the provisions of any statute or otherwise howsoever;

(a) arising out of or based upon any statement in the Prospectus being untrue or misleading or by reason of any omission by the Commonwealth therefrom of a material fact or facts which should have been stated therein to prevent the same from being misleading; or

(b) caused by or arising from any prohibition of trading in or distribution of the Fifteen Year Bonds which may be ordered under the provisions of any law or any of the Provinces of Canada if such prohibition is based upon any such untrue or misleading statement. The Commonwealth also agrees that in the event of any such prohibition occurring we, in addition to any other remedy, are to be entitled to cancel this agreement.

The above provisions of this paragraph 11 shall not apply to untrue or misleading statements or omissions in the Prospectus made in reliance upon and in conformity with information furnished to the Commonwealth in writing by us expressly for use therein and we shall indemnify and save the Commonwealth harmless against all claims, damages or liabilities to which it may be subjected and all losses which it may suffer, whether under the provisions of any statute or otherwise howsoever, arising out of or based upon any untrue or misleading statement or omission so made.

12. The Commonwealth will agree not to sell or permit the sale in the North American market of further Bonds of or guaranteed by the Commonwealth prior to December 1st, 1955.

13. If all the terms and conditions to be performed by the Commonwealth as outlined above shall not have been fulfilled and the Fifteen Year Bonds are not ready for delivery on or before November 8th, 1955, we shall have the right to cancel this agreement by written notice to the Commonwealth addressed to R. J. Gray, Treasury Officer, Australian Consulate General, 636 Fifth Avenue, New York 20, and in such event we shall be under no liability of any kind.

14. We may, by notice in writing to the Commonwealth, withdraw from this offer or from the agreement constituted by the acceptance thereof, with like privilege to the Commonwealth on the same grounds, if between the date hereof and the close of business on the day on which we open the books for public subscriptions for the Fifteen Year Bonds, there shall occur any substantial change in general business conditions which in our or its opinion would adversely affect the marketing of the Fifteen Year Bonds. In the event of any such withdrawal there shall be no liability to the Commonwealth on our part or to us on the part of the Commonwealth.

15. The Fifteen Year Bonds shall be offered to the public in Canada through a group of Canadian investment dealers and chartered banks selected by us at the initial offering price of 98.50% of the principal amount thereof plus accrued interest to the date of payment and delivery. Such offering shall be made and books opened for public subscriptions not later than seven days following the receipt by us of the signed Prospectus or on such later day as may be agreed upon by us and the Commonwealth. We agree not to distribute the Fifteen Year Bonds in such manner as to require registration of the issue under the United States Securities Act of 1933.

16. Time shall be of the essence of the agreement constituted by the acceptance of this offer.

17. This offer shall be deemed rejected unless it shall have been accepted by the Commonwealth by 2 p.m. Eastern Standard Time on October 6th, 1955, or by such later time as we may hereafter specify in writing.

If the foregoing is acceptable to the Commonwealth, please signify such acceptance on the attached duplicate of this letter and thereupon the foregoing shall constitute the contract for the sale by the Commonwealth and the purchase by us of the Fifteen Year Bonds referred to herein.

Yours very truly,

Wood, Gundy & Company Limited

By: W. P. SCOTT

Vice-President.

The foregoing offer is accepted this

6th day of October, 1955.

The Commonwealth of Australia

By; A. W FADDEN

Treasurer.

SECOND SCHEDULE. Section 5 (2.).

$l,000 Commonwealth of Australia No.

4% Fifteen Year Bond

Authorized and. Issued

$15,000,000

Principal due November 1, 1970

(subject to prior redemption)

The Commonwealth of Australia (hereinafter referred to as the “Commonwealth”) for value received, hereby promises to pay to the bearer hereof the sum of One Thousand Dollars ($1,000) in lawful money of Canada on the 1st day of November, 1970, or on such earlier date as this Bond may be redeemed in accordance with the provisions hereinafter contained at any branch in Canada of Royal Bank of Canada, at the holder’s option, with interest at the rate of four percentum (4%) per annum payable in like money half-yearly on the first days of May and November in each year at any of the said places at the holder’s option upon presentation and surrender of the coupons hereto attached, as they respectively become due. This Bond will be free of all taxes now or at any time hereafter imposed by the Commonwealth or by any taxing authority thereof or therein, except when this Bond is beneficially owned by any person residing in or ordinarily a resident of the Commonwealth.

This Bond is one of an issue of Fifteen Million Dollars ($15,000,000) principal amount of 4% Fifteen Year Bonds of the Commonwealth dated November 1, 1955, maturing November 1, 1970.

The right is reserved to the Commonwealth to redeem the 4% Fifteen Year Bonds as a whole at any time or in part and by lot from time to time at the following percentages of the principal amount thereof:

Up to and including November 1, 1958, at 102.50%, thereafter up to and including November 1, 1961 at 101.75%, thereafter up to and including November 1 1964 at 101%, thereafter up to and including November 1, 1967 at 100.50%, and thereafter and prior to maturity at 100%; together in each case with interest accrued to the date fixed for redemption. Notice of intention to redeem shall be given by publication at least once in each of two successive weeks in a daily newspaper of general circulation published in the City of Vancouver, Canada, and in a daily newspaper of general circulation published in the City of Winnipeg, Canada, and in a daily newspaper of general circulation published in the City of Toronto. Canada, and in a daily newspaper of general circulation printed in the English language and published in the City of Montreal, Canada, the first publication to be not less than thirty days prior to the redemption date specified in such notice. After the redemption date specified in said notice, provided payment is made or duly provided for pursuant thereto, interest on the principal sum hereof shall cease to accrue and any coupon for interest maturing after such date shall be null and void.

The Commonwealth covenants that it will set aside in a special account in a chartered bank in Canada as a sinking fund for the 4% Fifteen Year Bonds on or before November 1 in each of the years 1957 to 1969 inclusive, a sum sufficient to retire Five Hundred Thousand Dollars ($500,000) principal amount of 4% Fifteen Year Bonds. For a period of 120 days after each such sinking fund deposit such sinking fund moneys will be used to purchase 4% Fifteen Year Bonds in the market or by private contract at prices not exceeding the principal amount thereof plus in each case accrued interest and costs of purchase. Cash on hand in the sinking fund provided it amounts to Twenty-five Thousand Dollars ($25.000) or more at the expiration of said period of 120 days will be applied to the redemption of 4% Fifteen Year Bonds by lot at the principal amount thereof plus accrued interest to the date fixed for redemption, except that any sinking fund moneys on hand at the end of the 120 day period following November 1, 1969 will be applied to payment of the principal of the maturing Bonds. Amounts of cash in the sinking fund not applied to the redemption of Bonds by reason of the sum therein being less than Twenty-five Thousand Dollars ($25,000) will be added to the next sinking fund instalment and used as aforesaid. Bonds previously purchased may be credited against sinking fund obligation hereunder at an amount sufficient to retire the principal amount of such Bonds.

The Commonwealth will cancel all and will not reissue any 4% Fifteen Year Bonds purchased by it for sinking fund purposes.

Redemption of 4% Fifteen Year Bonds out of sinking fund moneys will be made upon the notice, in the manner and with the effect hereinbefore provided for optional redemption of Bonds.

Second Schedule—continued.

The Commonwealth covenants that, if in future it shall sell, offer for public subscription or in any manner dispose of any bonds or loans constituting external debt of the Commonwealth secured by lien on any revenue or asset of the Commonwealth the 4% Fifteen Year Bonds of this issue will be secured equally and rateably therewith.

In witness whereof, the Commonwealth of Australia, pursuant to due authorization by law, has caused this Bond to be duly executed by the facsimile of the signature of its Treasurer and to be countersigned by a duly authorized official and coupons for the interest on the principal sum hereof bearing the facsimile of the signature of its Treasurer to be annexed hereto.

Dated; November 1, 1955

Treasurer of the Commonwealth of Australia

Countersigned;

Treasury Officer

(Form of Coupon)

No..................... $.................

On the 1st day of........................................, 19........, unless the Bond below mentioned shall have been called for previous redemption and payment duly provided for, the Commonwealth of Australia will pay to bearer at any branch in Canada of The Royal Bank of Canada at the holder’s option Twenty Dollars ($20.00) in lawful money of Canada, being six months’ interest then payable on its 4% Fifteen Year Bond No......... due November 1, 1970, free of all Australian taxes, present or future, except when this coupon is beneficially owned by any person residing in or ordinarily a resident of the Commonwealth of Australia.

Treasurer of the Commonwealth of Australia