Subsection 1: General rules.

When a bond issue is amortised according to a table indicating the number of securities to be amortised in each period and the securities are not grouped into identified series, the securities to be amortised are selected as follows:

1° At a reference date prior to redemption and set by the contract of issue, the account keeper draws up a list of account holders holding the securities. The holders are listed in ascending order of their account number, or in any other order previously established by the account keeper and notified to the central depository with which the issue was deposited, and the number of their securities is indicated. The list is dated and certified on the same day by the person authorised for this purpose by the member;

2° The day after the record date, the issuer notifies the central depository of the number of securities to be amortised. The central depository then calculates, to five decimal places, the amortisation ratio, which is the ratio of the number of securities to be amortised to the number of securities in circulation. To determine the number of amortised securities to be allocated to each member, it applies the amortisation ratio to the number of securities held in each member's account, rounding the result down to the nearest whole number and allocating any balance according to the highest remainder rule. It then notifies each member of the amortisation ratio and the number of amortised securities allocated to it;

3° On receipt of this notification, the member makes an initial allocation of the securities to be amortised. It applies the amortisation ratio to the number of securities in each account. The result, rounded down to the nearest unit, is the number of amortised securities allocated to the account in question during this first allocation;

4° The member then makes a second allocation. He determines a starting point on the list of account holders by multiplying the total number of securities on the list by the number of hundred-thousandths formed by the sequence of five decimal places of the amortisation ratio and rounding it up to the next whole number. Starting from the rank of the security corresponding to this starting point, the member allocates the securities to be distributed to the holders appearing on the list in the order of registration, excluding those who benefited from the first distribution;

5° The member shall allocate any balance to the holders who benefited from the first distribution in accordance with the rule of the highest remainder;

6° The member shall keep the list referred to in 1° and the indication of the number of securities amortised in the account of the holders appearing thereon for a period of ten years.