Common use of Procedures for Establishing the Terms of the Notes Clause in Contracts

Procedures for Establishing the Terms of the Notes. Canada and the Distributor will discuss from time to time the price of and the rates to be borne by the Notes that may be sold as a result of the solicitation of offers by the Distributor. Once the Distributor has recorded any indication of interest in Notes upon certain terms, and communicated with Canada, if Canada plans to accept an offer to purchase Notes upon such terms, it will prepare a Pricing Supplement to the Prospectus, as then amended or supplemented, reflecting the terms of such Notes and, after consultation with the Distributor, will arrange to have the Pricing Supplement filed with the U.S. Securities and Exchange Commission (the “Commission”) pursuant to Rule 433 and Rule 424 under the Act, respectively.* Canada will supply a copy of the Prospectus, as then amended or supplemented, and such Pricing Supplement, to the Distributor (with a copy to the applicable Registrar). No settlement with respect to Notes upon such terms may occur prior to such transmitting or filing and the Distributor will not, prior to such transmitting or filing, deliver confirmations to customers who have offered to purchase Notes upon such terms. Canada will deliver the number of copies of the Pricing Supplement as the Distributor shall request. Pricing Supplements delivered to the Distributor will be sent to it at the address set forth in Schedule B-1 to the Distribution Agreement. Canada and the Distributor may discuss from time to time the aggregate principal amount of, the issuance price of, and the interest rates to be borne by, Notes that may be sold as a result of the solicitation of offers by the Distributor. If Canada decides to set prices of, and rates borne by, any Notes in respect of which the Distributor is to solicit offers (the setting of such prices and rates to be referred to herein as “posting”) or if Canada decides to change prices or rates previously posted, it will promptly advise the Distributor of the prices and rates to be posted. Canada, in its absolute discretion, shall have the sole right to accept or reject offers to purchase Notes, regardless of whether or not the offers fall within posted rates.