AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 19, 2004.
REGISTRATION NO. 333-112049
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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
FORM F-9
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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BRASCAN CORPORATION
(Exact name of Registrant as specified in its charter)
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ONTARIO 1121, 1031, 1061, 1311, 2421, 4939, 6311 NOT APPLICABLE
(Primary Standard Industrial (I.R.S. Employer Identification Number,
(Province or other Jurisdiction of Classification
Incorporation or Organization) Code Number, if applicable) if applicable)
BCE PLACE, 181 BAY STREET
SUITE 300, P.O. BOX 762
TORONTO, ONTARIO M5J 2T3
(416) 363-9491
(Address and telephone number of Registrant's principal executive offices)
TORYS LLP
237 PARK AVENUE
NEW YORK, NY 10017
ATTENTION: ANDREW J. BECK
(212) 880-6000
(Name, address (including zip code) and telephone number (including area code)
of agent for service in the United States)
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COPIES TO:
PHILIP BROWN
TORYS LLP
SUITE 3000
79 WELLINGTON STREET WEST
BOX 270, TD CENTRE
TORONTO, ONTARIO, CANADA M5K 1N2
(416) 865-0040
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
PROVINCE OF ONTARIO, CANADA
(Principal jurisdiction regulating this offering)
---------------------
It is proposed that this filing shall become effective (check appropriate box
below):
A. [ ] upon filing with the Commission, pursuant to Rule 467(a) (if in
connection with an offering being made contemporaneously in the United States
and Canada).
B. [X] at some future date (check appropriate box below)
1. [ ] pursuant to Rule 467(b) on ( ) at ( ) (designate a time not
sooner than seven calendar days after filing).
2. [ ] pursuant to Rule 467(b) on ( ) at ( ) (designate a time seven
calendar days or sooner after filing) because the securities
regulatory authority in the review jurisdiction has issued a receipt
or notification of clearance on ( ).
3. [X] pursuant to Rule 467(b) as soon as practicable after notification of
the Commission by the Registrant or the Canadian securities regulatory
authority of the review jurisdiction that a receipt or notification of
clearance has been issued with respect hereto.
4. [ ] after the filing of the next amendment to this Form (if preliminary
material is being filed).
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to the home jurisdiction's shelf
prospectus offering procedures, check the following box. [X]
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The Registrant hereby amends the Registration Statement on such date or dates as
may be necessary to delay its effective date until the registration statement
shall become effective as provided in Rule 467 under the Securities Act of 1933
or on such date as the Commission, acting pursuant to Section 8(a) of the Act,
may determine.
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PART I
INFORMATION REQUIRED TO BE DELIVERED TO OFFEREES OR PURCHASERS
BASE SHELF PROSPECTUS
This short form prospectus has been filed under legislation in each of the
provinces of Canada that permits certain information about these securities to
be determined after this prospectus has become final and that permits the
omission from this prospectus of that information. The legislation requires the
delivery to purchasers of a prospectus supplement containing the omitted
information within a specified period of time after agreeing to purchase any of
these securities.
NO SECURITIES REGULATORY AUTHORITY HAS EXPRESSED AN OPINION ABOUT THESE
SECURITIES AND IT IS AN OFFENCE TO CLAIM OTHERWISE. THIS SHORT FORM PROSPECTUS
CONSTITUTES A PUBLIC OFFERING OF THESE SECURITIES ONLY IN THOSE JURISDICTIONS
WHERE THEY MAY BE LAWFULLY OFFERED FOR SALE AND THEREIN ONLY BY PERSONS
PERMITTED TO SELL SUCH SECURITIES. INFORMATION HAS BEEN INCORPORATED BY
REFERENCE IN THIS PROSPECTUS FROM DOCUMENTS FILED WITH SECURITIES COMMISSIONS OR
SIMILAR AUTHORITIES IN CANADA. COPIES OF THE DOCUMENTS INCORPORATED HEREIN BY
REFERENCE MAY BE OBTAINED ON REQUEST WITHOUT CHARGE FROM THE OFFICE OF THE
CORPORATE SECRETARY OF THE COMPANY AT SUITE 300, BCE PLACE, 181 BAY STREET,
TORONTO, ONTARIO, CANADA, M5J 2T3, (416) 363-9491.
FEBRUARY 17, 2004
SHORT FORM PROSPECTUS
US$750,000,000
BRASCAN CORPORATION
DEBT SECURITIES
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Debt securities (the "Debt Securities") of Brascan Corporation (the
"Company") may be offered hereunder in one or more series in an aggregate
principal amount of up to U.S.$750,000,000 (or the equivalent in other
currencies or currency units) or, if any Debt Securities are offered at an
original issue discount, such greater amount as shall result in an aggregate
offering price of U.S.$750,000,000. Debt Securities of any series may be offered
in such amount and with such terms as may be determined in light of market
conditions. The specific designation, aggregate principal amount, denomination
(which may be in United States dollars, in any other currency or in units based
on or relating to foreign currencies), maturity, rate (which may be fixed or
variable) and time of payment of interest, if any, any terms for redemption at
the option of the Company or the holders, any terms for sinking fund payments,
any listing on a securities exchange, the initial public offering price (or the
manner of determination thereof if offered on a non-fixed price basis) and any
other terms in connection with the offering and sale of each series of Debt
Securities in respect of which this Prospectus is being delivered (the "Offered
Securities") will be set forth in a supplement to this Prospectus relating
thereto (a "Prospectus Supplement"). Each such Prospectus Supplement will be
incorporated by reference into this Base Shelf Prospectus for the purposes of
securities legislation as of the date of each such Prospectus Supplement and
only for the purposes of the distribution of the Debt Securities to which such
Prospectus Supplement pertains.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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THIS OFFERING IS MADE BY A CANADIAN ISSUER THAT IS PERMITTED, UNDER A
MULTIJURISDICTIONAL DISCLOSURE SYSTEM ADOPTED BY THE UNITED STATES, TO PREPARE
THIS PROSPECTUS IN ACCORDANCE WITH THE DISCLOSURE REQUIREMENTS OF ITS HOME
COUNTRY. PROSPECTIVE INVESTORS SHOULD BE AWARE THAT SUCH REQUIREMENTS ARE
DIFFERENT FROM THOSE OF THE UNITED STATES. THE FINANCIAL STATEMENTS INCLUDED OR
INCORPORATED HEREIN HAVE BEEN PREPARED IN ACCORDANCE WITH CANADIAN GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES, AND ARE SUBJECT TO CANADIAN AUDITING AND AUDITOR
INDEPENDENCE STANDARDS, AND THUS MAY NOT BE COMPARABLE TO FINANCIAL STATEMENTS
OF UNITED STATES COMPANIES.
PROSPECTIVE INVESTORS SHOULD BE AWARE THAT THE ACQUISITION OF THE DEBT
SECURITIES MAY HAVE TAX CONSEQUENCES BOTH IN THE UNITED STATES AND IN CANADA.
SUCH CONSEQUENCES FOR INVESTORS WHO ARE RESIDENT IN, OR CITIZENS OF, THE UNITED
STATES MAY NOT BE DESCRIBED FULLY HEREIN OR IN A PROSPECTUS SUPPLEMENT.
PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO
THEIR PARTICULAR CIRCUMSTANCES.
THE ENFORCEMENT BY INVESTORS OF CIVIL LIABILITIES UNDER THE FEDERAL
SECURITIES LAWS MAY BE AFFECTED ADVERSELY BY THE FACT THAT THE COMPANY IS
INCORPORATED OR ORGANIZED UNDER THE LAWS OF THE PROVINCE OF ONTARIO, THAT SOME
OR ALL OF ITS OFFICERS AND DIRECTORS MAY BE RESIDENTS OF CANADA, THAT SOME OR
ALL OF THE UNDERWRITERS OR EXPERTS NAMED IN THE REGISTRATION STATEMENT MAY BE
RESIDENTS OF CANADA AND THAT ALL OR A SUBSTANTIAL PORTION OF THE ASSETS OF THE
COMPANY AND SAID PERSONS MAY BE LOCATED OUTSIDE THE UNITED STATES.
The Company may sell Debt Securities to or through underwriters or dealers
or directly to investors or through agents. The Prospectus Supplement relating
to each series of Offered Securities will identify each person who may be deemed
to be an underwriter with respect to such series and will set forth the terms of
the offering of such series, including, to the extent applicable, the initial
public offering price, the proceeds to the Company, the underwriting commissions
and any other concessions to be allowed or reallowed to dealers. The managing
underwriter or underwriters with respect to each series sold to or through
underwriters will be named in the related Prospectus Supplement.
TABLE OF CONTENTS
PAGE
----
DOCUMENTS INCORPORATED BY REFERENCE......................... 2
AVAILABLE INFORMATION....................................... 3
SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION.......... 4
THE COMPANY................................................. 4
USE OF PROCEEDS............................................. 6
INTEREST COVERAGE RATIOS.................................... 6
DESCRIPTION OF DEBT SECURITIES.............................. 6
PLAN OF DISTRIBUTION........................................ 15
LEGAL MATTERS............................................... 16
EXPERTS..................................................... 16
DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT....... 16
In this Prospectus, unless the context otherwise indicates, references to
the "Company" refer to Brascan Corporation and references to "Brascan" refer to
the Company and its direct and indirect subsidiaries. All dollar amounts set
forth in this Prospectus and any Prospectus Supplement are in U.S. dollars,
except where otherwise indicated.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents, filed with the securities regulatory authorities
in each of the provinces of Canada, are specifically incorporated by reference
in, and form an integral part of, this Prospectus:
(a) the Company's annual information form dated May 20, 2003;
(b) the unaudited comparative consolidated financial statements of the
Company contained in the interim report to shareholders for the nine months
ended September 30, 2003;
(c) the audited comparative consolidated financial statements of the
Company and the notes thereto for the financial year ended December 31,
2002, together with the report of the auditors thereon, found at pages 60
through 85 of the Company's 2002 annual report;
(d) the management discussion and analysis of financial results
contained in pages 21 to 59 of the Company's 2002 annual report;
(e) management's discussion and analysis of financial condition and
results of operations dated November 6, 2003 contained in the interim
report to shareholders for the nine months ended September 30, 2003;
(f) the unaudited consolidated annual financial statements as at and
for the year ended December 31, 2003 contained in the press release dated
February 12, 2004;
(g) the Company's management information circular dated March 1, 2003
in connection with the April 29, 2003 Annual Meeting of Shareholders, other
than the sections entitled "Report on Executive Compensation" and
"Performance Graph"; and
(h) the material change report of the Corporation dated February 13,
2004 with respect to the Canary Wharf offer.
All documents of the Company of the type referred to above and any material
change reports (excluding confidential reports) which are required to be filed
by the Company with the Ontario Securities Commission after the date of this
Prospectus and prior to the termination of the offering shall be deemed to be
incorporated by reference into this Prospectus. In addition, any report on Form
6-K or Form 40-F filed by the Company
2
with the Securities and Exchange Commission (the "Commission") after the date of
this Prospectus shall be deemed to be incorporated by reference into this
Prospectus if and to the extent expressly provided in such report.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such statement. The
modifying or superseding statement need not state that it has modified or
superseded a prior statement or include any other information set forth in the
document that it modifies or supersedes. The making of a modifying or
superseding statement shall not be deemed an admission for any purposes that the
modified or superseded statement, when made, constituted a misrepresentation, an
untrue statement of a material fact or an omission to state a material fact that
is required to be stated or that is necessary to make a statement not misleading
in light of the circumstances in which it was made. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Upon a new annual information form and new annual financial statements
being filed with and, where required, accepted by the applicable securities
regulatory authorities during the currency of this Prospectus, the previous
annual information form, the previous annual financial statements and all
interim financial statements, material change reports and information circulars
filed prior to the commencement of the then current fiscal year will be deemed
no longer to be incorporated into this Prospectus for purposes of future offers
and sales of Debt Securities hereunder.
A Prospectus Supplement containing the specific terms of an offering of
Debt Securities will be delivered to purchasers of such Debt Securities together
with this Prospectus and will be deemed to be incorporated into this Prospectus
as of the date of such Prospectus Supplement but only for purposes of the
offering of Debt Securities covered by that Prospectus Supplement.
Where the Company updates its disclosure of interest coverage ratios by a
Prospectus Supplement, the Prospectus Supplement filed with applicable
securities regulatory authorities that contains the most recent updated
disclosure of interest coverage ratios and any Prospectus Supplement supplying
any additional or updated information the Company may elect to include (provided
that such information does not describe a material change that has not already
been the subject of a material change report or a prospectus amendment) will be
delivered to purchasers of Debt Securities together with this Prospectus and
will be deemed to be incorporated into this Prospectus as of the date of the
Prospectus Supplement.
Prospective investors should rely only on the information incorporated by
reference or contained in this Prospectus or any Prospectus Supplement and on
the other information included in the Registration Statement on Form F-9
relating to the Debt Securities and of which this Prospectus is a part. The
Company has not authorized anyone to provide different or additional
information.
COPIES OF THE DOCUMENTS INCORPORATED HEREIN BY REFERENCE MAY BE OBTAINED ON
REQUEST WITHOUT CHARGE FROM THE CORPORATE SECRETARY OF THE COMPANY AT SUITE 300,
BCE PLACE, 181 BAY STREET, TORONTO, ONTARIO, CANADA, M5J 2T3 (TELEPHONE:
416-363-9491). FOR THE PURPOSE OF THE PROVINCE OF QUEBEC, THIS SIMPLIFIED
PROSPECTUS CONTAINS INFORMATION TO BE COMPLETED BY CONSULTING THE PERMANENT
INFORMATION RECORD. A COPY OF THE PERMANENT INFORMATION RECORD MAY BE OBTAINED
FROM THE CORPORATE SECRETARY.
AVAILABLE INFORMATION
The Company has filed with the Commission under the Securities Act of 1933,
as amended (the "Securities Act"), a Registration Statement on Form F-9 relating
to the Debt Securities and of which this Prospectus is a part. This Prospectus
does not contain all of the information set forth in such Registration
Statement, to which reference is made for further information.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports and other information with the
3
Commission. Under a multijurisdictional disclosure system adopted by the United
States, such reports and other information may be prepared in accordance with
the disclosure requirements of Canada, which requirements are different from
those of the United States. Such reports and other information concerning the
Company can be inspected and copied at the public reference facilities
maintained by the Commission at: Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, Room 1024; and 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of these materials can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates.
SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION
Certain statements included and incorporated by reference herein constitute
"forward-looking statements" within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements include, but are
not limited to, references to future capital expenditures (including the amount
and nature thereof), business strategies and measures to implement strategies,
competitive strengths, goals, expansion and growth of Brascan's business and
operations, plans and references to the future success of Brascan. These
forward-looking statements are based on certain assumptions and analyses made by
the Company in light of its experience and its perception of historical trends,
current conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances. However, whether actual results
and developments will conform with the expectations and predictions of the
Company is subject to a number of risks and uncertainties, including, but not
limited to: general economic, market or business conditions; fluctuations in
interest rates; the opportunities (or lack thereof) that may be presented to,
and pursued by, Brascan; competitive actions by other companies; conditions in
the real estate, power generation, asset management, financial services and
natural resources industries; the cyclical nature of the resource investment and
fluctuations in commodity prices; changes in laws or regulations, including
changes in the regulations, standards and market expectation regarding the
environment, particularly in natural resources and energy operations; risks
associated with the economic, political and regulatory policies of local
governments and laws and policies of Canada, the United States and Brazil; the
potential impact of increased competition in the markets within which Brascan
operates; and other factors, many of which are beyond the control of Brascan.
Consequently, all of the forward-looking statements made in this Prospectus and
the documents incorporated by reference herein are qualified by these cautionary
statements, and there can be no assurance that the actual results or
developments anticipated by the Company will be realized or, even if
substantially realized, that they will have the expected consequences to, or
effects on, the Company. As a result of these factors, the Company's revenue and
income could vary significantly from quarter to quarter, and past financial
performance should not be considered a reliable indicator of future performance.
All subsequent written and oral forward-looking statements attributable to the
Company or persons acting on its behalf are expressly qualified in their
entirety by the cautionary statements set forth or referred to above in this
paragraph. Investors are cautioned not to place undue reliance on such
statements which speak only as of the date hereof. The Company undertakes no
obligation to release publicly any revision to these forward-looking statements
to reflect events or circumstances following the date hereof or to reflect the
occurrence of unanticipated events, except as may be required by securities
laws.
THE COMPANY
Brascan is a real estate, power generation and asset management company
whose objective is to earn a superior return on equity by operating businesses
which produce consistent and sustainable cash flows. With direct investments of
$16 billion and a further $5 billion of assets under management, Brascan owns 55
high quality office properties, 42 power generating plants and an increasing
portfolio of financial and other assets under management. In addition, Brascan
holds investments in the resource sector. Brascan's goal is to build long-term
shareholder value by investing in high quality assets, and by continuously
pursuing new opportunities for future growth. Brascan's Class A Limited Voting
Shares are listed on the New York and Toronto Stock Exchanges under the symbol
BNN. Its publicly traded preferred shares and preferred securities are listed
primarily on the Toronto Stock Exchange.
4
RECENT DEVELOPMENTS
The following is a summary of significant recent developments affecting
Brascan since May 20, 2003:
In May 2003, Brascan completed a $17 million transmission interconnection
between its hydroelectric generating operations in Maine and the New England
power grid, expanding this link from 20 megawatts ("MW") to 126 MW.
In June 2003, Brascan's commercial real estate subsidiary issued $110
million of preference shares.
In June, 2003, Brascan's wholly-owned power generation subsidiary issued
Cdn.$384 million of 6.6% senior secured bonds due June 16, 2023. An additional
Cdn.$115 million of 7.8% subordinated secured bonds due June 16, 2023 were
issued in July 2003.
In July 2003, Noranda Inc. ("Noranda") announced a recapitalization plan
involving, among other things, the reduction of its quarterly dividend from
Cdn.$0.20 per share to Cdn.$0.12 per share, the issue of common shares and debt,
and the conversion to U.S. dollar reporting of its financial results. In
connection with this plan, Noranda completed in August 2003, a public offering
of 24.8 million common shares at a price of Cdn.$12.65 per share for total gross
proceeds of approximately Cdn.$313 million. Concurrent with the issue, Brascan
purchased from Noranda, at the same price, 20 million common shares to raise
further gross proceeds of Cdn.$253 million. Noranda subsequently completed the
sale of its remaining 11,984,900 Priority Units of Noranda Income Fund for total
net proceeds of Cdn.$118 million.
In August 2003, Brascan completed the initial public offering of trust
units in the Royal LePage Franchise Service Fund. The offering raised gross
proceeds of Cdn.$100 million and is part of Brascan's strategy to expand its
100% owned residential real estate services operations.
In August 2003, Brascan's residential home building subsidiary closed the
sale of 395 lots in San Diego County for proceeds of $52 million.
In September 2003, Brascan agreed to sell a 49% interest in 245 Park Avenue
to New York State Teachers' Retirement System. The total proceeds of the
transaction were $438 million for the 49% interest. Brascan will retain the
management and leasing of the property.
In September 2003, Brascan's residential home building subsidiary completed
a Dutch auction tender offer for up to 5,000,000 shares of its outstanding
common stock. Approximately 1.1 million shares of its common stock were
repurchased of which 50% were tendered by the Company. All of the shares were
accepted for purchased at a price of $18.50 per share.
In September 2003, Noranda sold $350 million of 6% Notes due on October 15,
2015.
In October, 2003, Brascan established Brascan SoundVest Diversified Income
Fund which completed an initial public offering of trust units, raising proceeds
of Cdn.$69 million.
In October 2003, Brascan's commercial real estate subsidiary issued
Cdn.$200 million of preference shares.
In November 2003, Brascan's power generating subsidiary completed a 17
year, Cdn.$175 million, 6.91% senior bond private placement financing, secured
by its Mississagi River hydroelectric generating facilities in northern Ontario.
In November 2003, Brascan sold its 42% interest in Northgate Exploration
("Northgate") to a syndicate of underwriters for net proceeds of Cdn.$210
million. Northgate owns a gold/copper mine in British Columbia, Canada, which
was acquired in conjunction with a Brascan led restructuring conducted by its
asset management group.
In November 2003, Brascan announced that it and certain institutional
partners had submitted a proposal to the Independent Committee of Canary Wharf
Group PLC ("Canary Wharf"), regarding an all cash offer to shareholders of 252
pence per Canary Wharf share for a total acquisition cost of approximately L1.5
billion. The announcement also stated that there was no certainty that any offer
would ultimately be accepted.
5
In December 2003, Brascan announced that it had entered into an agreement
with Mr. Paul Reichmann and certain Reichmann family interests wherein Brascan
agreed, amongst other things, to tender its 9% shareholding in Canary Wharf to a
Reichmann offer for Canary Wharf at a price of 275 pence per share or higher if
such an offer was made prior to January 31, 2004, failing which the Reichmann
interests would tender their shares to a Brascan offer, if made by February 16,
2004, at a price of 267 pence per share or more. Neither Reichmann nor Brascan
is obligated to make an offer.
In December 2003, Brascan, through its commercial real estate subsidiary
acquired 1625 Eye Street in Washington, D.C. from Union Labour Life Insurance
Company for $157.5 million.
In December 2003, Brascan's commercial real estate subsidiary issued
Cdn.$200 million of preference shares.
In December 2003, Brascan acquired three hydroelectric power plants with a
combined generating capacity of 16 MW located in the northeastern United States
from Hafslund, a Norwegian-based power company, for approximately $30 million.
On February 5, 2004, Brascan confirmed that CWG Acquisition Limited, a
company formed at the direction of Brascan and certain institutional investors,
announced the terms of an offer to acquire Canary Wharf. Brascan, British
Columbia Investment Management Corporation, Ontario Teachers' Pension Plan Board
and funds managed by Hermes Pensions Management Limited will all invest,
indirectly, in CWG Acquisition Limited. On February 12, 2004, the Offer was
amended by CWG Acquisition.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement relating to a series
of Debt Securities, the net proceeds received by the Company from the sale of
Debt Securities will be used by the Company for general corporate purposes
including the repayment of corporate debt.
INTEREST COVERAGE RATIOS
The interest coverage ratios have been calculated based on instruments
classified as debt under current Canadian GAAP. Pursuant to Canadian GAAP, an
aggregate of $211 million and $223 million of unsecured junior subordinated
debentures and convertible notes are included in shareholders' equity as at
September 30, 2003 and December 31, 2002, respectively and the distributions
thereon are charged, on an after tax basis, to retained earnings. Based on this
presentation, Brascan's consolidated interest requirements for the 12 months
ended September 30, 2003 and December 31, 2002 amounted to $504 million and $496
million, respectively. Brascan's earnings before interest and income tax for the
12 months ended September 30, 2003 and December 31, 2002 were $690 million and
$653 million, respectively, which are 1.4 and 1.3 times Brascan's aggregate
interest requirements for the respective periods.
The interest coverage ratios in the preceding paragraph have been
calculated without the annual carrying charges relating to the unsecured junior
subordinated debentures and convertible notes. If the unsecured junior
subordinated debentures and convertible notes were classified as debt, their
entire pre-tax carrying charges would be included in interest expense. If the
annual carrying charges had been included in the calculations, the impact on the
interest coverage ratios for the 12 month periods ended September 30, 2003 and
December 31, 2002 would have been negligible with the ratios remaining at
approximately 1.3 times and 1.3 times, respectively.
DESCRIPTION OF DEBT SECURITIES
The following description sets forth certain general terms and provisions
of the Debt Securities. The particular terms and provisions of the series of
Debt Securities offered by a Prospectus Supplement, and the extent to which the
general terms and provisions described below may apply thereto, will be
described in such Prospectus Supplement.
6
The Debt Securities will be issued under an indenture dated as of September
20, 1995, as supplemented, (the "Indenture") between the Company and
Computershare Trust Company of Canada (formerly, Montreal Trust Company of
Canada), as trustee (the "Trustee"). The Indenture is subject to the provisions
of the Business Corporations Act (Ontario) and, consequently, is exempt from the
operation of certain provisions of the Trust Indenture Act of 1939 pursuant to
Rule 4d-9 thereunder. A copy of the form of the Indenture has been filed with
the Commission as an exhibit to the Registration Statement of which this
Prospectus is a part. The following statements with respect to the Indenture and
the Securities (as hereinafter defined) are brief summaries of certain
provisions of the Indenture and do not purport to be complete; such statements
are subject to the detailed referenced provisions of the Indenture, including
the definition of capitalized terms used under this caption. Wherever particular
sections or defined terms of the Indenture are referred to, such sections or
defined terms are incorporated herein by reference as part of the statement
made, and the statement is qualified in its entirety by such reference. The term
"Securities", as used under this caption, refers to all securities issued under
the Indenture, including the Debt Securities.
GENERAL
The Indenture does not limit the aggregate principal amount of Offered
Securities (which may include debentures, notes and other unsecured evidences of
indebtedness) which may be issued thereunder, and Securities may be issued
thereunder from time to time in one or more series and may be denominated and
payable in foreign currencies or units based on or relating to foreign
currencies, including European Currency Units. Special Canadian and United
States federal income tax considerations applicable to any Securities so
denominated will be described in the Prospectus Supplement relating thereto. The
Securities offered pursuant to this Prospectus will be limited to $750,000,000
(or the equivalent in other currencies or currency units) aggregate principal
amount. Unless otherwise indicated in the applicable Prospectus Supplement, the
Indenture also permits the Company to increase the principal amount of any
series of Securities previously issued and to issue such increased principal
amount (Section 301).
The applicable Prospectus Supplement will set forth the following terms
relating to the Offered Securities: (1) the specific designation of the Offered
Securities; (2) any limit on the aggregate principal amount of the Offered
Securities; (3) the date or dates, if any, on which the Offered Securities will
mature and the portion (if less than all of the principal amount) of the Offered
Securities to be payable upon declaration of acceleration of maturity; (4) the
rate or rates per annum (which may be fixed or variable) at which the Offered
Securities will bear interest, if any, the date or dates from which any such
interest will accrue and on which any such interest will be payable and the
Regular Record Dates for any interest payable on the Offered Securities which
are in registered form ("Registered Securities"); (5) any mandatory or optional
redemption or sinking fund provisions, including the period or periods within
which the price or prices at which and the terms and conditions upon which the
Offered Securities may be redeemed or purchased at the option of the Company or
otherwise; (6) whether the Offered Securities will be issuable in registered
form or bearer form or both and, if issuable in bearer form, the restrictions as
to the offer, sale and delivery of the Offered Securities in bearer form and as
to exchanges between registered and bearer form; (7) whether the Offered
Securities will be issuable in the form of one or more registered global
securities ("Registered Global Securities") and, if so, the identity of the
Depository for such Registered Global Securities; (8) the denominations in which
any of the Securities will be issuable if in other than denominations of $1,000
and any multiple thereof; (9) each office or agency where the principal of, and
any premium and interest on, the Offered Securities will be payable and each
office or agency where the Offered Securities may be presented for registration
of transfer or exchange; (10) if other than U.S. dollars, the foreign currency
or the units based on or relating to foreign currencies in which the Offered
Securities are denominated and/or in which the payment of the principal of, and
any premium and interest on, the Offered Securities will or may be payable; (11)
any index pursuant to which the amount of payments of principal of, and any
premium and interest on, the Offered Securities will or may be determined; (12)
any other terms of the Offered Securities, including covenants and additional
Events of Default. Special Canadian and United States federal income tax
considerations applicable to the Securities, the amount of principal thereof and
any premium and interest thereon which is determined by reference to an index
will be described in the Prospectus Supplement relating thereto. Unless
otherwise indicated in the applicable Prospectus Supplement, the Indenture does
not afford the Holders the
7
right to tender Securities to the Company for repurchase, or provide for any
increase in the rate or rates of interest per annum at which the Securities will
bear interest, in the event the Company should become involved in a highly
leveraged transaction or in the event of a change in control of the Company.
(Section 301)
Securities may be issued under the Indenture bearing no interest or
interest at a rate below the prevailing market rate at the time of issuance, to
be offered and sold at a discount below their stated principal amount. The
Canadian and United States federal income tax consequences and other special
considerations applicable to any such discounted Securities or other Securities
offered and sold at par which are treated as having been issued at a discount
for Canadian and/or United States federal income tax purposes will be described
in the Prospectus Supplement relating thereto. (Section 301)
The Securities and any coupons appertaining thereto will be unsecured and
will rank pari passu with each other and with all other unsecured and
unsubordinated indebtedness for borrowed money of the Company. (Section 301)
The Company conducts a significant amount of its operations through
subsidiaries. Although the Securities are senior obligations of the Company,
they are effectively subordinated to all existing and future liabilities of the
Company's consolidated subsidiaries and operating companies. The Indenture does
not restrict the ability of the Company's subsidiaries to incur additional
indebtedness. Because the Company conducts a significant amount of its
operations through subsidiaries, the Company's ability to service its
indebtedness is dependent on dividends and other distributions it receives from
subsidiaries and major investments. Certain of the instruments governing the
indebtedness of the companies in which the Company has an investment may
restrict the ability of such companies to pay dividends or make other payments
on investments under certain circumstances.
FORM, DENOMINATION, EXCHANGE AND TRANSFER
Unless otherwise indicated in the applicable Prospectus Supplement, the
Securities will be issued only in fully registered form without coupons and in
denominations of $1,000 or any integral multiple thereof. (Section 302)
Securities may be presented for exchange and Registered Securities may be
presented for registration of transfer in the manner, at the places and, subject
to the restrictions set forth in the Indenture and in the applicable Prospectus
Supplement, without service charge, but upon payment of any taxes or the
governmental charges due in connection therewith. The Company has appointed the
Trustee as Security Registrar. (Section 305)
PAYMENT
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of the principal of, and any premium and interest on, Registered Securities
(other than a Registered Global Security) will be made at the office or agency
of the Trustee in Toronto, Canada, except that, at the option of the Company,
payment of any interest may be made (i) by check mailed to the address of the
Person entitled thereto at such address as shall appear in the Security Register
or (ii) by wire transfer to an account maintained by the Person entitled thereto
as specified in the Security Register. (Sections 305, 307 and 1002) Unless
otherwise indicated in the applicable Prospectus Supplement, payment of any
interest due on Registered Securities will be made to the Persons in whose name
such Registered Securities are registered at the close of business on the
Regular Record Date for such interest payment. (Section 307)
REGISTERED GLOBAL SECURITIES
The Registered Securities of a particular series may be issued in the form
of one or more Registered Global Securities which will be registered in the name
of, and deposited with, one or more Depositories or nominees, each of which will
be identified in the Prospectus Supplement relating to such series. Unless and
until exchanged, in whole or in part, for Securities in definitive registered
form, a Registered Global Security may not be transferred except as a whole by
the Depository for such Registered Global Security to a nominee of such
Depository, by a nominee of such Depository to such Depository or another
nominee of such
8
Depository or by such Depository or any such nominee to a successor of such
Depository or a nominee of such successor. (Section 305)
The specific terms of the depository arrangement with respect to any
portion of a particular series of Securities to be represented by a Registered
Global Security will be described in the Prospectus Supplement relating to such
series. The Company anticipates that the following provisions will apply to all
depository arrangements.
Upon the issuance of a Registered Global Security, the Depository therefor
or its nominee will credit, on its book entry and registration system, the
respective principal amounts of the Securities represented by such Registered
Global Security to the accounts of such persons having accounts with such
Depository or its nominee ("participants") as shall be designated by the
underwriters, investment dealers or agents participating in the distribution of
such Securities or by the Company if such Securities are offered and sold
directly by the Company. Ownership of beneficial interests in a Registered
Global Security will be limited to participants or persons that may hold
beneficial interests through participants. Ownership of beneficial interests in
a Registered Global Security will be shown on, and the transfer of such
ownership will be effected only through, records maintained by the Depository
therefor or its nominee (with respect to beneficial interests of participants)
or by participants or persons that hold through participants (with respect to
interests of persons other than participants). The laws of some states in the
United States require certain purchasers of securities to take physical delivery
thereof in definitive form. Such depository arrangements and such laws may
impair the ability to transfer beneficial interests in a Registered Global
Security.
So long as the Depository for a Registered Global Security or its nominee
is the registered owner thereof, such Depository or such nominee, as the case
may be, will be considered the sole owner or Holder of the Securities
represented by such Registered Global Security for all purposes under the
Indenture. Except as provided below, owners of beneficial interests in a
Registered Global Security will not be entitled to have Securities of the series
represented by such Registered Global Security registered in their names, will
not receive or be entitled to receive physical delivery of Securities of such
series in definitive form and will not be considered the owners or Holders
thereof under the Indenture.
Principal, premium, if any, and interest payments on a Registered Global
Security registered in the name of a Depository or its nominee will be made to
such Depository or nominee, as the case may be, as the registered owner of such
Registered Global Security. None of the Company, the Trustee or any paying agent
for Securities of the series represented by such Registered Global Security will
have any responsibility or liability for any aspect of the records relating to,
or payments made on account of, beneficial interests in such Registered Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial interests.
The Company expects that the Depository for a Registered Global Security or
its nominee, upon receipt of any payment of principal, premium or interest, will
immediately credit participants' accounts with payments in amounts proportionate
to their respective beneficial interests in the principal amount of such
Registered Global Security as shown on the records of such Depository or its
nominee. The Company also expects that payments by participants to owners of
beneficial interests in such Registered Global Security held through such
participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers registered
in "street name", and will be the responsibility of such participants.
If the Depository for a Registered Global Security representing Securities
of a particular series is at any time unwilling or unable to continue as
Depository and a successor Depository is not appointed by the Company within 90
days, the Company will issue Registered Securities of such series in definitive
form in exchange for such Registered Global Security. In addition, the Company
may determine, at any time and in its sole discretion, not to have the
Securities of a particular series represented by one or more Registered Global
Securities and, in such event, will issue Registered Securities of such series
in definitive form in exchange for all of the Registered Global Securities
representing Securities of such series. (Section 305)
9
CONSOLIDATION, MERGER, AMALGAMATION AND SALE OF ASSETS
The Company shall not enter into any transaction (whether by way of
reorganization, reconstruction, consolidation, amalgamation, merger, transfer,
sale or otherwise) whereby all or substantially all of its undertaking, property
and assets would become the property of any other Person (the "Successor
Corporation") unless: (a) the Company and the Successor Corporation shall
execute, prior to or contemporaneously with the consummation of such
transaction, such instruments and do such things as, in the opinion of counsel,
shall be necessary or advisable to establish that, upon the consummation of such
transaction, (i) the Successor Corporation will have assumed all the covenants
and obligations of the Company under the Indenture in respect of the Securities
of every series and (ii) the Securities of every series will be valid and
binding obligations of the Successor Corporation entitling the Holders thereof,
as against the Successor Corporation, to all the rights of Holders of Securities
under the Indenture; and (b) such transaction shall be on such terms and shall
be carried out at such times and otherwise in such manner as shall not be
prejudicial to the interests of the Holders of the Securities of each and every
series or to the rights and powers of the Trustee under the Indenture. (Section
801)
EVENTS OF DEFAULT
Unless otherwise indicated in any Prospectus Supplement, each of the
following will constitute an Event of Default under the Indenture with respect
to Securities of any series: (a) failure to pay principal of, or any premium on,
any Security of that series when due; (b) failure to pay any interest on any
Securities of that series when due, which failure continues for 30 days; (c)
default in the payment of principal and interest on any Security required to be
purchased pursuant to an Offer to Purchase required to be made pursuant to the
terms of the Securities of such series; (d) failure to deposit any sinking fund
payment, when due, in respect of any Security of that series; (e) failure to
perform any other covenant of the Company in the Indenture (other than a
covenant included in the Indenture solely for the benefit of a series other than
that series), which failure continues for 60 days after written notice has been
given by the Trustee or the Holders of at least 25% in aggregate principal
amount of Outstanding Securities of that series, as provided in the Indenture;
(f) failure by the Company to make any payment of principal of, or interest on,
any obligation for borrowed money (other than an obligation payable on demand or
maturing less than 12 months from the creation or issue thereof) when due or
within any originally stated applicable grace period having an outstanding
principal amount in excess of 5% of the Company's Consolidated Net Worth in the
aggregate at the time of default or any failure in the performance of any other
covenant of the Company contained in any instrument under which such obligations
are created or issued and if the holders thereof, or a trustee, if any, for such
holders declare such obligations to be due and payable prior to the stated
maturities thereof, provided that if such default is waived by such holders or
trustee, then the Event of Default under the Indenture shall be deemed to be
waived without further action on the part of the Trustee or the Holders; (g)
certain events of bankruptcy, insolvency or reorganization affecting the
Company; and (h) any other Events of Default provided with respect to the
Securities of such series, as described in the applicable Prospectus Supplement.
(Section 501)
If an Event of Default (other than an Event of Default described in clause
(g) above) with respect to the Securities of any series at the time outstanding
shall occur and be continuing, either the Trustee or the Holders of at least 25%
in aggregate principal amount of Outstanding Securities of that series by
notice, as provided in the Indenture, may declare the principal amount of the
Securities of that series to be due and payable immediately. If an Event of
Default described in clause (g) above with respect to the Securities of any
series at the time Outstanding shall occur, the principal amount of all the
Securities of that series will automatically, and without any action by the
Trustee or any Holder, become immediately due and payable. After any such
acceleration, but before a judgment or decree based on acceleration, the Holders
of a majority in aggregate principal amount of the Outstanding Securities of
that series may, under certain circumstances, rescind and annul such
acceleration if all Events of Default, other than the non-payment of accelerated
principal (or other specified amount), have been cured or waived as provided in
the Indenture. (Section 502) For information as to waiver of defaults, see
"-- Modification and Waiver".
The Indenture provides that the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request or
direction of any of the Holders, unless such Holders shall have offered to
10
the Trustee reasonable indemnity. (Section 603) Subject to such provisions for
the indemnification of the Trustee, the Holders of a majority in aggregate
principal amount of the Outstanding Securities of any series will have the right
to direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee with respect to the Securities of that series. (Section 512)
No Holder of a Security of any series will have any right to institute any
proceeding with respect to the Indenture, or for the appointment of a receiver
or a trustee, or for any other remedy thereunder, unless (i) such Holder has
previously given to the Trustee written notice of a continuing Event of Default
with respect to the Securities of that series, (ii) the Holders of at least 25%
in aggregate principal amount of the Outstanding Securities of that series have
made a written request, and such Holder or Holders have offered reasonable
indemnity, to the Trustee to institute such proceeding as trustee and (iii) the
Trustee has failed to institute such proceeding, and has not received from the
Holders of a majority in aggregate principal amount of the Outstanding
Securities of that series a direction inconsistent with such request, within 60
days after such notice, request and offer. (Section 507) However, such
limitations do not apply to a suit instituted by a Holder of a Security for the
enforcement of payment of the principal of, or of any premium or interest on,
such Security on or after the applicable due date specified in such Security.
(Section 508)
The Company is required to furnish to the Trustee quarterly a statement by
certain of its officers as to whether or not the Company, to their knowledge, is
in default in the performance or observance of any of the terms, provisions and
conditions of the Indenture and, if so, specifying all such known defaults.
(Section 1004)
DEFEASANCE
The Indenture provides that, at the option of the Company, the Company will
be discharged from any and all obligations in respect of the Outstanding
Securities upon irrevocable deposit with the Trustee, in trust, of money and/or
Government Obligations which will provide money in an amount sufficient, in the
opinion of a nationally recognized firm of independent public accountants, to
pay the principal of or premium, if any, and each instalment of interest, if
any, on the Outstanding Securities ("Defeasance"). Such trust may only be
established if, among other things: (i) the Company has received from, or there
has been published by, the Internal Revenue Service a ruling or there has been a
change in law which, in the Opinion of Counsel, provides that Holders of the
Outstanding Securities will not recognize gain or loss for United States federal
income tax purposes as a result of such Defeasance and will be subject to United
States federal income tax on the same amount, in the same manner and at the same
times as would have been the case if such Defeasance had not occurred; (ii) the
Company has delivered to the Trustee an opinion of Canadian counsel or a ruling
from Revenue Canada (now Canada Customs and Revenue Agency) to the effect that
the Holders of the Outstanding Securities will not recognize income, gain or
loss for Canadian federal, provincial or territorial income tax or other tax
purposes as a result of such Defeasance and will be subject to Canadian federal
or provincial income tax and other tax on the same amounts, in the same manner
and at the same times as would have been the case had such Defeasance not
occurred (and for the purposes of such opinion, such Canadian counsel shall
assume that Holders of the Securities include Holders who are not resident in
Canada); (iii) no Event of Default or event that, with the passing of time or
the giving of notice or both, shall constitute an Event of Default shall have
occurred or be continuing; (iv) the Company has delivered to the Trustee an
Opinion of Counsel to the effect that such deposit shall not cause the Trustee
or the trust so created to be subject to the Investment Company Act of 1940; and
(v) certain other customary conditions precedent are satisfied. The Company may
exercise its Defeasance option notwithstanding its prior exercise of its
Covenant Defeasance option described in the following paragraph if the Company
meets the conditions described in the preceding sentence at the time the Company
exercises the Defeasance option.
The Indenture provides that, at the option of the Company, unless and until
the Company has exercised its Defeasance option described in the preceding
paragraph, the Company may omit to comply with certain restrictive covenants and
such omission shall not be deemed to be an Event of Default under the Indenture
and the Outstanding Securities upon irrevocable deposit with the Trustee, in
trust, of money and/or Government Obligations which will provide money in an
amount sufficient, in the opinion of a nationally recognized firm of independent
public accountants, to pay the principal of and premium, if any, and each
11
instalment of interest, if any, on the Outstanding Securities ("Covenant
Defeasance"). In the event the Company exercises its Covenant Defeasance option,
the obligations under the Indenture (other than with respect to such covenants
and the Events of Default other than the Events of Default relating to such
covenants above) shall remain in full force and effect. Such trust may only be
established if, among other things: (i) the Company has delivered to the Trustee
an Opinion of Counsel to the effect that the Holders of the Outstanding
Securities will not recognize gain or loss for United States federal income tax
purposes as a result of such Covenant Defeasance and will be subject to United
States federal income tax on the same amount, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not occurred;
(ii) the Company has delivered to the Trustee an opinion of Canadian counsel or
a ruling from Revenue Canada (now Canada Customs and Revenue Agency) to the
effect that the Holders of the Outstanding Securities will not recognize income,
gain or loss for Canadian federal, provincial or territorial income tax or other
tax purposes as a result of such Covenant Defeasance and will be subject to
Canadian federal or provincial income tax and other tax on the same amounts, in
the same manner and at the same times as would have been the case had such
Covenant Defeasance not occurred (and for the purposes of such opinion, such
Canadian counsel shall assume that Holders of the Securities include Holders who
are not resident in Canada); (iii) no Event of Default or event that, with the
passing of time or the giving of notice or both, shall constitute an Event of
Default shall have occurred or be continuing; (iv) the Company has delivered to
the Trustee an Opinion of Counsel to the effect that such deposit shall not
cause the Trustee or the trust so created to be subject to the Investment
Company Act of 1940; and (v) certain other customary conditions precedent are
satisfied. (Article Thirteen)
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of each series of Securities
affected by such modification or amendment; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Security affected thereby, (a) change the Stated Maturity of the
principal of, or any instalment of interest on, any Outstanding Security, (b)
reduce the principal amount of (or the premium), or interest on, any Outstanding
Security, (c) reduce the amount of the principal of any Outstanding Security
payable upon the acceleration of the maturity thereof, (d) change the place or
currency of payment of principal of (or the premium), or interest on, any
Outstanding Security, (e) impair the right to institute suit for the enforcement
of any payment on or with respect to any Outstanding Security, (f) reduce the
above-stated percentage of Outstanding Securities necessary to modify or amend
the Indenture, (g) reduce the percentage of aggregate principal amount of
Outstanding Securities necessary for waiver of compliance with certain
provisions of the Indenture or for waiver of certain defaults, (h) modify any
provisions of the Indenture relating to the modification and amendment of the
Indenture or the waiver of past defaults or covenants, except as otherwise
specified or (i) following the mailing of any Offer to Purchase, modify any
Offer to Purchase for such Outstanding Security required to be made pursuant to
the terms of such Outstanding Security in a manner materially adverse to the
Holders thereof. (Section 902)
The Holders of a majority in aggregate principal amount of the Outstanding
Securities of any series, on behalf of all Holders of Outstanding Securities of
such series, may waive compliance by the Company with certain restrictive
provisions of the Indenture. (Section 1009) Subject to certain rights of the
Trustee, as provided in the Indenture, the Holders of a majority in aggregate
principal amount of the Outstanding Securities, on behalf of all holders of
Outstanding Securities of such series, may waive any past default under the
Indenture, except a default in the payment of principal, premium or interest or
a default arising from failure to purchase any Outstanding Securities tendered
pursuant to an Offer to Purchase. (Section 513)
CONSENT TO JURISDICTION AND SERVICE
The Indenture provides that the Company irrevocably appoint CT Corporation
System, 1633 Broadway, New York, New York, 10019, as its agent for service of
process in any suit, action or proceeding arising out of or relating to the
Indenture and the Securities and for actions brought under federal or state
securities laws
12
brought in any federal or state court located in the Borough of Manhattan in The
City of New York and submit to such jurisdiction.
ENFORCEABILITY OF JUDGMENTS
Since a substantial portion of the Company's assets are outside the United
States, any judgment obtained in the United States against the Company,
including any judgment with respect to the payment of interest and principal on
the Debt Securities, may not be collectible within the United States.
The Company has been informed by its Canadian counsel, Torys LLP ("Torys"),
that a court of competent jurisdiction in the Province of Ontario would enforce
a final and conclusive judgment in personam of a court sitting in the Borough of
Manhattan, the City of New York, New York (a "New York Court") that is
subsisting and unsatisfied respecting the enforcement of the Indenture and the
Securities that is not impeachable as void or voidable under the internal laws
of the State of New York for a sum certain if: (i) the court rendering such
judgment had jurisdiction over the judgment debtor, as recognized by the courts
of the Province of Ontario (and submission by the Company in the Indenture to
the jurisdiction of the New York Court will be sufficient for the purpose); (ii)
such judgment was not obtained by fraud or in a manner contrary to natural
justice and the enforcement thereof would not be inconsistent with public
policy, as such term is understood under the laws of the Province of Ontario, or
contrary to any order made by the Attorney General of Canada under the Foreign
Extraterritorial Measures Act (Canada); (iii) the enforcement of such judgment
does not constitute, directly or indirectly, the enforcement of foreign revenue
or penal laws; and (iv) the action to enforce such judgment is commenced within
six years of the date of such judgment. The Company has been advised by such
counsel that there is some doubt as to the enforceability in Canada, against the
Company or against any of its respective directors, officers and experts who are
not residents of the United States, by a court in original actions or in actions
to enforce judgments of United States courts, of civil liabilities predicated
solely upon the United States federal securities laws.
GOVERNING LAW
The Indenture and the Securities will be governed by the laws of the State
of New York, except with respect to the rights, powers, duties or responsibility
of the Trustee which shall be governed by the laws of the Province of Ontario
and the federal laws of Canada applicable therein. (Section 113)
THE TRUSTEE
The Trustee under the Indenture is Computershare Trust Company of Canada.
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms, as well as any other terms used herein for which no definition is
provided. (Section 101)
"Affiliate" of any Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control", when used with
respect to any Person, means the power to influence the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" having meanings correlative to the foregoing.
"Capital Lease Obligation" of any Person means the obligation to pay rent
or other payment amounts under a lease of (or other Debt arrangements conveying
the right to use) real or personal property of such Person which is required to
be classified and accounted for as a capital lease or a liability on the face of
a balance sheet of such Person in accordance with Canadian generally accepted
accounting principles and which has a term of at least 36 months. The stated
maturity of such obligation shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which such lease
may be terminated by the lessee without payment of a penalty.
13
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock or
other equity participations, including partnership interests whether general or
limited, of such Person.
"Common Stock" of any Person means Capital Stock of such Person that does
not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
"Consolidated Net Worth" of any Person means the consolidated stockholders'
equity of such Person, determined on a consolidated basis in accordance with
Canadian generally accepted accounting principles, plus, without duplication,
Qualifying Subordinated Debt and Deferred Credits; provided that, with respect
to the Company, adjustments following the date of the Indenture to the
accounting books and records of the Company in accordance with U.S. Accounting
Principles Board Opinions Nos. 16 and 17 (or successor opinions thereto), or
comparable standards in Canada, or otherwise resulting from the acquisition of
control of the Company by another Person shall not be given effect.
"Debt" means (without duplication), with respect to any Person, whether
recourse is to all or a portion of the assets of such Person and whether or not
contingent, (i) every obligation of such Person for money borrowed, (ii) every
obligation of such Person evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the acquisition
of property, assets or businesses, (iii) every reimbursement obligation of such
Person with respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of such Person, (iv) every obligation of such
Person issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or accrued liabilities arising in the
ordinary course of business which are not overdue or which are being contested
in good faith), (v) every Capital Lease Obligation of such Person, (vi) every
obligation that could not be considered as interest in accordance with Canadian
generally accepted accounting principles under Interest Rate or Currency
Protection Agreements of such Person and (vii) every obligation of the type
referred to in clauses (i) through (vi) of another Person and all dividends of
another Person the payment of which, in either case, such Person has Guaranteed
or is responsible or liable for, directly or indirectly, as obligator, Guarantor
or otherwise.
"Deferred Credits" means the deferred credits of the Company and its
Subsidiaries determined on a consolidated basis in accordance with Canadian
generally accepted accounting principles.
"Government Obligation" means (x) any security which is (i) a direct
obligation of the government which issued the currency, or a direct obligation
of the Government of Canada issued in such currency, in which the Securities of
a particular series are denominated for the payment of which its full faith and
credit is pledged or (ii) obligations of a Person the payment of which is
unconditionally guaranteed as its full faith and credit obligation by such
government which, in the case of either subclause (i) or (ii) of this clause
(x), is not callable or redeemable at the option of the issuer thereof and (y)
any depositary receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act) as custodian with respect to any Government Obligation which is
specified in clause (x) above and held by such bank for the account of the
holder of such depositary receipt, or with respect to any specific payment of
principal of or interest on any Government Obligation which is so specified and
held, provided that (except as required by law) such custodian is not authorized
to make any deduction from the amount payable to the holder of such depositary
receipt from any amount received by the custodian in respect of the Government
Obligation or the specific payment of principal or interest evidenced by such
depositary receipt.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person guaranteeing or having the economic effect of guaranteeing any Debt
of any other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including, without limitation, any obligation of such Person (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Debt or to purchase (or to advance or supply funds for the purchase of) any
security for the payment of such Debt, (ii) to purchase property, securities or
services for the purpose of assuring the holder of such Debt of the payment of
such Debt or (iii) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Debt (and "Guaranteed", "Guaranteeing"
and
14
"Guarantor" shall have meanings correlative to the foregoing); provided,
however, that the Guarantee by any Person shall not include endorsements by such
Person for collection or deposit, in either case, in the ordinary course of
business.
"Interest Rate or Currency Protection Agreement" of any Person means any
interest rate protection agreement (including, without limitation, interest rate
swaps, caps, floors, collars and similar agreements), and/or other types of
interest hedging agreements, and any currency protection agreement (including
foreign exchange contracts, currency swap agreements or other currency hedging
arrangements).
"Qualifying Subordinated Debt" means Debt of the Company (i) which by its
terms provides that the payment of principal of (and premium, if any) and
interest on, and all other payment obligations in respect of, such Debt shall be
subordinate to the prior payment in full of the Securities to at least the
extent that no payment of principal of (or premium, if any) or interest on or
otherwise due in respect of such Debt may be made for so long as there exists
any default in the payment of principal (or premium, if any) or interest on the
Securities or any other default that, with the passing of time or the giving of
notice or both, would constitute an event of default with respect to the
Securities and (ii) which expressly by its terms gives the Company the right to
make payments of principal in respect of such Debt in Common Stock of the
Company.
"Stated Maturity", when used with respect to any Security or any instalment
of principal thereof or interest thereon, means the date specified in such
Security as the fixed date on which the principal of such Security or such
instalment of principal or interest is due and payable.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through underwriters or dealers
and also may sell Debt Securities directly to purchasers or through agents.
The distribution of Debt Securities of any series may be effected from time
to time in one or more transactions at a fixed price or prices, which may be
changed, at market prices prevailing at the time of sale, at prices related to
such prevailing market prices or at prices to be negotiated with purchasers.
In connection with the sale of Debt Securities, underwriters may receive
compensation from the Company or from purchasers of Debt Securities for whom
they may act as agents in the form of concessions or commissions. Underwriters,
dealers and agents that participate in the distribution of Debt Securities may
be deemed to be underwriters and any commissions received by them from the
Company and any profit on the resale of Debt Securities by them may be deemed to
be underwriting commissions under the Securities Act. Any such person that may
be deemed to be an underwriter with respect to Debt Securities of any series
will be identified in the Prospectus Supplement relating to such series.
The Prospectus Supplement relating to each series of Debt Securities will
also set forth the terms of the offering of the Debt Securities of such series,
including, to the extent applicable, the names of any underwriters or agents,
the purchase price or prices of the Offered Securities, the initial offering
price, the proceeds to the Company from the sale of the Offered Securities, the
underwriting discounts and commissions and any discounts, commissions and
concessions allowed or reallowed or paid by any underwriter to other dealers.
If so indicated in the applicable Prospectus Supplement, the Company may
authorize dealers or other persons acting as the Company's agents to solicit
offers by certain institutions to purchase the Offered Securities directly from
the Company pursuant to contracts providing for payment and delivery on a future
date. These contracts will be subject only to the conditions set forth in the
applicable Prospectus Supplement which will also set forth the commission
payable for solicitation of these contracts.
Under agreements which may be entered into by the Company, underwriters,
dealers and agents who participate in the distribution of Debt Securities may be
entitled to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act and Canadian provincial
securities legislation, or to contribution with respect to payments which those
underwriters, dealers or agents may be required to
15
make in respect thereof. Those underwriters, dealers and agents may be customers
of, engage in transactions with or perform services for the Company or its
subsidiaries in the ordinary course of business.
Each series of Debt Securities will be a new issue of securities with no
established trading market. Unless otherwise specified in a Prospectus
Supplement relating to a series of Debt Securities, the Debt Securities will not
be listed on any securities exchange. Certain broker-dealers may make a market
in Debt Securities but will not be obligated to do so and may discontinue any
market making at any time without notice. No assurance can be given that any
broker-dealer will make a market in the Debt Securities of any series or as to
the liquidity of the trading market for the Debt Securities of any series.
In connection with any underwritten offering of Debt Securities, the
underwriters or agents may over-allot or effect transactions which stabilize or
maintain the market price of the Debt Securities offered at a level above that
which might otherwise prevail in the open market. Such transactions, if
commenced, may be discontinued at any time.
LEGAL MATTERS
Unless otherwise specified in a Prospectus Supplement relating to a series
of Debt Securities, certain matters of Canadian and United States law relating
to the validity of the Debt Securities will be passed upon for the Company by
Torys in Toronto, Ontario, and New York, New York. The partners and associates
of Torys, as a group, beneficially own, directly or indirectly, less than one
percent of the outstanding securities of the Company.
EXPERTS
The consolidated financial statements of the Company for the financial year
ended December 31, 2002, incorporated by reference in this Prospectus by
reference to Brascan Corporation's 2002 annual report, have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated by reference herein, and have been so incorporated in reliance on
the report of such firm given upon their authority as experts in auditing and
accounting.
DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT
The following documents have been filed with the Commission as part of the
Registration Statement on Form F-9 of which this Prospectus forms a part: the
documents referred to under "Documents Incorporated by Reference"; consent of
Deloitte & Touche LLP; consent of Torys; powers of attorney; trust indenture
dated as of September 20, 1995 between the Company and Montreal Trust Company of
Canada, as trustee; and method of calculation of interest coverage.
16
PART II
INFORMATION NOT REQUIRED TO BE DELIVERED TO
OFFEREES OR PURCHASERS
INDEMNIFICATION OF DIRECTORS OR OFFICERS.
Under the Business Corporations Act (Ontario), the Company may indemnify a
present or former director or officer or a person who acts or acted at the
Company's request as a director or officer of another corporation of which the
Company is or was a shareholder or creditor, and his or her heirs and legal
representatives, against all costs, charges and expenses, including an amount
paid to settle an action or satisfy a judgment, reasonably incurred by him or
her in respect of any civil, criminal or administrative action or proceeding to
which he or she is made a party by reason of being or having been a director or
officer of the Company or such other corporation and provided that the director
or officer acted honestly and in good faith with a view to the best interests of
the Company, and, in the case of a criminal or administrative action or
proceeding that is enforced by a monetary penalty, such director or officer had
reasonable grounds for believing that his or her conduct was lawful. Such
indemnification may be made in connection with an action by or on behalf of the
Company or such other corporation to procure a judgment in its favor only with
court approval. A director or officer is entitled to indemnification from the
Company as a matter of right if he or she was substantially successful on the
merits in his or her defense of the action or proceeding and fulfilled the
conditions set forth above.
In accordance with the Business Corporations Act (Ontario), the board of
directors of the Company approved a resolution (the "Resolution") dated August
1, 1997 providing for the following:
(i) the Company shall indemnify a director or officer of the Company,
a former director or officer of the Company or a person who acts or acted
at the Company's request as a director or officer of a body corporate of
which the Company is or was a shareholder or creditor, and his or her heirs
and legal representatives, against all costs, charges and expenses,
including an amount paid to settle an action or satisfy a judgment,
reasonably incurred by him or her in respect of any civil, criminal or
administrative action or proceeding to which he or she is made a party by
reason of being or having been a director or officer of the Company or such
body corporate (except in respect of an action by or on behalf of the
Company or such body corporate to procure a judgment in its favor), if,
(a) he or she acted honestly and in good faith with a view to the
best interests of the Company, and
(b) in the case of a criminal or administrative action or
proceeding that is enforced by a monetary penalty, he or she had
reasonable grounds for believing that his or her conduct was lawful;
(ii) the Company shall, with the prior approval of the court having
jurisdiction, indemnify a person referred to in (i) above in respect of an
action by or on behalf of the Company or such body corporate to procure a
judgment in its favor, to which he or she is made a party by reason of
being or having been a director or an officer of the Company or such body
corporate, against all costs, charges and expenses reasonably incurred by
him or her in connection with such action if he or she fulfils the
conditions set out in paragraphs (i)(a) and (b) above; and
(iii) notwithstanding anything in (i) and (ii) above, a person
referred to in (i) above shall be indemnified by the Company in respect of
all costs, charges and expenses reasonably incurred by him or her in
connection with the defense of any civil, criminal or administrative action
or proceeding to which he or she is made a party by reason of being or
having been a director or officer of the Company or body corporate, if the
person seeking indemnity,
(a) was substantially successful on the merits in his or her
defense of the action or proceeding, and
(b) fulfils the conditions set out in paragraphs (i)(a) and (b)
above.
II-1
Nothing in the by-laws or resolutions of the Company limits the right of
any person entitled to claim indemnity apart from the indemnity provided
pursuant to the Resolution.
A policy of directors' and officers' liability insurance is maintained by
the Company which insures, subject to certain exclusions, directors and officers
for losses as a result of claims against the directors and officers of the
Company in their capacity as directors and officers and also reimburses the
Company for payments made pursuant to the indemnity provided by the Company
pursuant to the Resolution and the Business Corporations Act (Ontario).
Insofar as indemnification for liabilities under the United States
Securities Act of 1933 may be permitted to directors, officers or persons
controlling the Registrant pursuant to the foregoing provisions, the Registrant
has been advised that in the opinion of the U.S. Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is therefore unenforceable.
EXHIBITS
The following exhibits have been filed as part of this Registration
Statement:
EXHIBIT
NUMBER DESCRIPTION
------- -----------
4.1 Annual Information Form of the Company dated May 20, 2003
(incorporated by reference to the Company's Annual Report on
Form 40-F for the year ended December 31, 2002).
4.2 Unaudited comparative consolidated financial statements of
the Company contained in the interim report to shareholders
for the nine months ended September 30, 2003 (incorporated
by reference to the Company's Form 6-K filed on November 26,
2003).
4.3 Audited comparative consolidated financial statements of the
Company and the notes thereto for the financial year ended
December 31, 2002, together with the report of the auditors
thereon, found at pages 60 through 85 of the Company's 2002
Annual Report (incorporated by reference to the Company's
Form 6-K filed on April 2, 2003).
4.4 Management's discussion and analysis of financial results
contained on pages 21 to 59 of the Company's 2002 Annual
Report (incorporated by reference to the Company's Form 6-K
filed on April 2, 2003).
4.5 Management's discussion and analysis of financial condition
and results of operations dated November 6, 2003 contained
in the interim report to shareholders for the nine months
ended September 30, 2003 (incorporated by reference to the
Company's Form 6-K filed on November 26, 2003).
4.6 Management information circular dated March 1, 2003 in
connection with the April 29, 2003 Annual Meeting of
Shareholders, other than the sections entitled "Report on
Executive Compensation" and "Performance Graph"
(incorporated by reference to the Company's Form 6-K filed
on April 2, 2003).
4.7 Unaudited consolidated annual financial statements as at and
for the year ended December 31, 2003.
4.8 Material change report of the Company dated February 13,
2004 (incorporated by reference to the Company's Form 6-K
filed on February 13, 2004).
5.1 Consent of Deloitte & Touche LLP.
5.2+ Consent of Torys LLP.
6.1+ Powers of Attorney.
7.1+ Trust Indenture dated as of September 20, 1995 by the
Company in favor of Montreal Trust Company, as trustee.
9.1+ Interest Coverage calculations.
---------------
+ Previously filed.
II-2
PART III
UNDERTAKING AND CONSENT TO SERVICE OF PROCESS
ITEM 1. UNDERTAKING.
The Registrant undertakes to make available, in person or by telephone,
representatives to respond to inquiries made by the Commission staff, and to
furnish promptly, when requested to do so by the Commission staff, information
relating to the securities registered pursuant to this Form F-9 or to
transactions in said securities.
ITEM 2. CONSENT TO SERVICE OF PROCESS.
The Registrant has filed with the Commission a written irrevocable consent
and power of attorney on Form F-X.
Computershare Trust Company of Canada, the Trustee under the Indenture (as
successor to Montreal Trust Company), has filed with the Commission a written
irrevocable consent and power of attorney on Form F-X.
III-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form F-9 and has duly caused this amendment to its
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Toronto, Province of Ontario, Country of Canada,
on this 17th day of February, 2004.
BRASCAN CORPORATION
By: /s/ BRIAN D. LAWSON
------------------------------------
Name: Brian D. Lawson
Title: Executive Vice-President and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933 this amendment
to the Registration Statement has been signed by the following persons in the
capacities indicated and on February 17, 2004:
SIGNATURE TITLE
--------- -----
/s/ J. BRUCE FLATT President and Chief Executive Officer and Director
-------------------------------------- (Principal Executive Officer)
J. Bruce Flatt
/s/ BRIAN D. LAWSON Executive Vice-President and Chief Financial
-------------------------------------- Officer (Principal Financial Officer)
Brian D. Lawson
/s/ BRYAN K. DAVIS Senior Vice-President, Finance (Principal
-------------------------------------- Accounting Officer)
Bryan K. Davis
Director
--------------------------------------
Roberto P. Cezar de Andrade
Director
--------------------------------------
The Lord Black of Crossharbour
Director
--------------------------------------
James J. Blanchard
* Co-Chairman and Director
--------------------------------------
Jack L. Cockwell
* Director
--------------------------------------
The Honourable J. Trevor Eyton, O.C.
Director
--------------------------------------
Julia E. Foster
III-2
SIGNATURE TITLE
--------- -----
* Director
--------------------------------------
James K. Gray, O.C.
Director
--------------------------------------
Lynda C. Hamilton
* Chairman and Director
--------------------------------------
Robert J. Harding, FCA
* Director
--------------------------------------
David W. Kerr
* Director
--------------------------------------
Philip B. Lind
* Director
--------------------------------------
The Honourable Roy MacLaren, P.C.
* Director
--------------------------------------
G. Wallace F. McCain
Director
--------------------------------------
Jack M. Mintz
* Director
--------------------------------------
George E. Myhall
* Director
--------------------------------------
Saul Shulman, Q.C.
Director
--------------------------------------
George S. Taylor
*By: /s/ BRIAN D. LAWSON
------------------------------
Name: Brian D. Lawson
Title: Attorney-in-fact
III-3
AUTHORIZED REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities Act of 1933,
as amended, the undersigned has signed this amendment to the Registration
Statement, solely in the capacity of the duly authorized representative of
Brascan Corporation in the United States, on this 17th day of February, 2004.
TORYS LLP
By: /s/ ANDREW J. BECK
------------------------------------
Name: Andrew J. Beck
Title: Partner
III-4
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
------- -----------
4.1 Annual Information Form of the Company dated May 20, 2003
(incorporated by reference to the Company's Annual Report on
Form 40-F for the year ended December 31, 2002).
4.2 Unaudited comparative consolidated financial statements of
the Company contained in the interim report to shareholders
for the nine months ended September 30, 2003 (incorporated
by reference to the Company's Form 6-K filed on November 26,
2003).
4.3 Audited comparative consolidated financial statements of the
Company and the notes thereto for the financial year ended
December 31, 2002, together with the report of the auditors
thereon, found at pages 60 through 85 of the Company's 2002
Annual Report (incorporated by reference to the Company's
Form 6-K filed on April 2, 2003).
4.4 Management's discussion and analysis of financial results
contained on pages 21 to 59 of the Company's 2002 Annual
Report (incorporated by reference to the Company's Form 6-K
filed on April 2, 2003).
4.5 Management's discussion and analysis of financial condition
and results of operations dated November 6, 2003 contained
in the interim report to shareholders for the nine months
ended September 30, 2003 (incorporated by reference to the
Company's Form 6-K filed on November 26, 2003).
4.6 Management information circular dated March 1, 2003 in
connection with the April 29, 2003 Annual Meeting of
Shareholders, other than the sections entitled "Report on
Executive Compensation" and "Performance Graph"
(incorporated by reference to the Company's Form 6-K filed
on April 2, 2003).
4.7 Unaudited consolidated annual financial statements as at and
for the year ended December 31, 2003.
4.8 Material change report of the Company dated February 13,
2004 (incorporated by reference to the Company's Form 6-K
filed on February 13, 2004).
5.1 Consent of Deloitte & Touche LLP.
5.2+ Consent of Torys LLP.
6.1+ Powers of Attorney.
7.1+ Trust Indenture dated as of September 20, 1995 by the
Company in favor of Montreal Trust Company, as trustee.
9.1+ Interest Coverage calculations.
---------------
+ Previously filed.