0001104659-22-055028.txt : 20220503 0001104659-22-055028.hdr.sgml : 20220503 20220503075840 ACCESSION NUMBER: 0001104659-22-055028 CONFORMED SUBMISSION TYPE: F-3 PUBLIC DOCUMENT COUNT: 11 REFERENCES 429: 333-258765 FILED AS OF DATE: 20220503 DATE AS OF CHANGE: 20220503 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Brookfield Business Partners L.P. CENTRAL INDEX KEY: 0001654795 STANDARD INDUSTRIAL CLASSIFICATION: CONSTRUCTION SPECIAL TRADE CONTRACTORS [1700] IRS NUMBER: 000000000 STATE OF INCORPORATION: D0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-264630 FILM NUMBER: 22884656 BUSINESS ADDRESS: STREET 1: 73 FRONT STREET, 5TH FLOOR CITY: HAMILTON STATE: D0 ZIP: HM 12 BUSINESS PHONE: (441) 294-3309 MAIL ADDRESS: STREET 1: 73 FRONT STREET, 5TH FLOOR CITY: HAMILTON STATE: D0 ZIP: HM 12 F-3 1 tm2213999-1_f3.htm F-3 tm2213999-1_f3 - none - 10.3906725s
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 3, 2022
REGISTRATION NO. 333-    ​
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM F-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BROOKFIELD BUSINESS PARTNERS L.P.
(Exact name of registrant as specified in its charter)
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Bermuda
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Not applicable
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(State or Other Jurisdiction of
Incorporation or Organization)​
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(I.R.S. Employer
Identification Number)
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73 Front Street, 5th Floor
Hamilton, HM 12, Bermuda
+1 (441) 295-1443
(Address and Telephone Number of Registrant’s Principal Executive Offices)
Brookfield BBP US Holdings LLC
Brookfield Place
250 Vesey Street, 15th Floor
New York, NY 10281-1023
(212) 417-7000
(Name, Address and Telephone Number of Agent for Service)
Copies to:
Mile T. Kurta, Esq.
Torys LLP
1114 Avenue of the Americas, 23rd Floor
New York, NY 10036
(212) 880-6000
Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement.
If only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ☐
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒
If this Form is filed to register additional securities for an offering pursuant to Rule  462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a registration statement pursuant to General Instruction I.C. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ☐
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.C. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging Growth Company ☐​
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
The Registrant hereby amends the Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a) of the Securities Act of 1933, as amended, may determine.
Pursuant to the provisions of Rule 429 under the Securities Act, the prospectus contained in this registration statement also relates to the Registrant’s registration statement on Form F-3 (File No. 333-258765). Upon effectiveness, this registration statement will also act as a post-effective amendment to such earlier registration statement.
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The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012
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EXPLANATORY NOTE
On August 12, 2021, Brookfield Business Partners L.P. (the “partnership”) filed a registration statement (the “Prior Registration Statement”) on Form F-3 (File No. 333-258765) with the U.S. Securities and Exchange Commission (the “SEC”) related to the issuance and/or delivery of an aggregate of 74,000,000 of its non-voting limited partnership units (“units”) in connection with the exchange, redemption or acquisition, as applicable, from time to time of class A exchangeable subordinate voting shares (“exchangeable shares”) of Brookfield Business Corporation (“BBUC”). The Prior Registration Statement was subsequently declared effective by the SEC on March 1, 2022. Pursuant to Rule 429 under the Securities Act of 1933 (the “Securities Act”), this registration statement, which is a new registration statement, combines the 73,008,085 units from the Prior Registration Statement, which remain unissued, with an additional 60,000,000 units, all of which are registered hereby for issuance and/or delivery, as applicable, from time to time by the partnership, BBUC and/or Brookfield Asset Management Inc., to enable an aggregate of 133,008,085 units to be issued or delivered pursuant to the combined prospectus. Pursuant to Rule 429 under the Securities Act, this registration statement also constitutes a post-effective amendment to the Prior Registration Statement, and such post-effective amendment shall hereafter become effective concurrently with the effectiveness of this registration statement in accordance with Section 8(c) of the Securities Act.
The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
Subject to Completion dated May 3, 2022
[MISSING IMAGE: lg_brookfield-4c.jpg]
BROOKFIELD BUSINESS PARTNERS L.P.
Limited Partnership Units
This prospectus relates to 60,000,000 non-voting limited partnership units (the “units”) of Brookfield Business Partners L.P. (the “partnership”) that from time to time may be issued by the partnership or delivered by Brookfield Business Corporation (“BBUC”) to satisfy any exchange, redemption or acquisition of class A exchangeable subordinate voting shares (the “exchangeable shares”) of BBUC (including, if applicable, in connection with liquidation, dissolution or winding up of BBUC).
Brookfield Asset Management Inc. (“Brookfield” or the “selling securityholder”) has also agreed that, in the event that neither the partnership nor BBUC has satisfied an exchange request by a holder of exchangeable shares, then Brookfield, as selling securityholder, will satisfy until the fifth anniversary of the date of the Special Distribution such exchange requests by paying such cash amount or delivering such units (up to 60,000,000 units) pursuant to this prospectus.
This prospectus also relates to up to 73,008,085 units that from time to time may be issued by the partnership or delivered by BBUC, or delivered by Brookfield as selling securityholder, to satisfy any exchange, redemption or acquisition of outstanding exchangeable shares (including, if applicable, in connection with liquidation, dissolution or winding up of BBUC) that have not been previously exchanged for the issuance of units. These exchanges were previously registered pursuant to the partnership’s registration statement on Form F-3 (File No. 333-258765), which was declared effective by the Securities and Exchange Commission (the “SEC”) on March 1, 2022 (the “Prior Registration Statement”). Pursuant to Rule 429 under the Securities Act of 1933, as amended (the “Securities Act”), this prospectus updates the Prior Registration Statement and includes the units previously registered by the partnership pursuant to such Prior Registration Statement.
None of the partnership, BBUC or Brookfield will receive any cash proceeds from the issuance or delivery of any units upon exchange, redemption or acquisition, as applicable, of exchangeable shares pursuant to this prospectus.
The units are listed on the New York Stock Exchange (the “NYSE”) under the trading symbol “BBU” and the Toronto Stock Exchange (“TSX”) under the symbol “BBU.UN.” The last reported sale price of a unit on May 2, 2022 was $24.17 on the NYSE and C$31.25 on the TSX.
Investing in the units involves risks. Please see “Risk Factors” beginning on page 3 of this prospectus, and in similarly-captioned sections in the documents incorporated by reference herein, for a discussion of risk factors you should consider before investing in the units.
Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is                 , 2022
 
TABLE OF CONTENTS
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i
 
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement on Form F-3 that we have filed with the SEC under the Securities Act with respect to units to be issued, from time to time, in connection with the exchange, redemption or acquisition, if any and as applicable, of exchangeable shares (including in connection with liquidation, dissolution or winding up of BBUC). The partnership or BBUC may issue or deliver, as the case may be, to holders of exchangeable shares, at any time and from time to time, units in connection with the exchange, redemption or acquisition, if any and as applicable, of exchangeable shares (including in connection with liquidation, dissolution or winding up of BBUC). Additionally, the selling securityholder may deliver to holders of exchangeable shares, at any time and from time to time, units in exchange for exchangeable shares under circumstances that are more fully described in this prospectus. As allowed by the SEC rules, this prospectus does not contain all the information included in the registration statement. For further information, you are referred to the registration statement, including its exhibits, as well as any applicable prospectus supplement and any documents incorporated by reference herein or therein.
You should read this prospectus together with any applicable prospectus supplement thereto, and in any free writing prospectus that we may provide to you, and any documents incorporated by reference herein or therein and any additional information you may need to make your investment decision. You should also read and carefully consider the information in the documents we have referred you to in “Where You Can Find More Information” and “Incorporation by Reference” below. Information incorporated by reference after the date of this prospectus is considered a part of this prospectus and may add, update or change information contained in this prospectus. The information in this prospectus or any document incorporated by reference herein by reference is accurate only as of the date contained on the cover of such documents. Neither the delivery of this prospectus nor any delivery of units made under this prospectus will, under any circumstances, imply that the information in this prospectus is correct as of any date after this prospectus. Our business, financial condition and results of operations may have changed since that date. Any information in such subsequent filings that is inconsistent with this prospectus will supersede the information in this prospectus.
You should rely only on the information incorporated by reference or provided in this prospectus and any accompanying prospectus supplement, and in any free writing prospectus that we may provide to you. We and the selling securityholder have not authorized anyone else to provide you with other information. We and the selling securityholder are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted.
Unless the context requires otherwise, when used in this prospectus, the term “partnership” refers to Brookfield Business Partners L.P.; the terms “Brookfield Business Partners,” “we,” “us” and “our” refer to, collectively, (i) the partnership, (ii) Brookfield Business L.P. (“Holding LP”), (iii) the primary holding subsidiaries of Holding LP, from time to time, through which the partnership holds its interest in the operating businesses (the “Holding Entities”) and (iv) the businesses in which the Holding Entities hold interests and that directly or indirectly hold the partnership’s operations and assets, other than entities in which the Holding Entities hold interests for investment purposes only of less than 5% of the outstanding equity securities of that entity, and any other direct or indirect subsidiary of a Holding Entity (but excluding BBUC); and the term “general partner” refers to Brookfield Business Partners Limited, the partnership’s general partner. References to “our group” mean, collectively, Brookfield Business Partners and BBUC.
The financial information contained or incorporated by reference in this prospectus is presented in United States dollars and unless otherwise indicated has been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). Information prepared in accordance with IFRS may differ from financial information prepared in accordance with U.S. GAAP and therefore may not be comparable.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This prospectus and the documents incorporated by reference in this prospectus contain “forward-looking information” within the meaning of Canadian securities laws and “forward-looking statements” within the meaning of applicable Canadian and U.S. securities laws. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of our company, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects”, “anticipates”, “plans”, “believes”, “estimates”, “seeks”, “intends”, “targets”, “projects”, “forecasts”, “views”, “potential”, “likely”, or negative versions thereof and other similar expressions, or future or conditional verbs such as “may”, “will”, “should”, “would” and “could”.
Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, investors and other readers should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of our company to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements and information.
Factors that could cause our actual results to differ materially from those contemplated or implied by the statements in this prospectus and the documents incorporated by reference in this prospectus include, without limitation:
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the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; including as a result of the ongoing novel coronavirus (SARS-CoV-2) pandemic and any SARS-CoV-2 variants (collectively, “COVID-19”);
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the behavior of financial markets, including fluctuations in interest and foreign exchange rates, global equity and capital markets and the availability of equity and debt financing and refinancing within these markets;
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strategic actions including dispositions;
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the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits;
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changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates);
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the effect of applying future accounting changes;
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the ability to appropriately manage human capital;
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business competition;
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operational and reputational risks;
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technological change;
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changes in government regulation and legislation within the countries in which we operate;
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governmental investigations;
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litigation;
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changes in tax laws;
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ability to collect amounts owed;
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catastrophic events, such as earthquakes, hurricanes and pandemics/epidemics;
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the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and
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other risks and factors described under the heading “Risk Factors” in this prospectus, any prospectus supplement, and in our Annual Report on Form 20-F for the fiscal year ended December 31, 2021, filed with the SEC on April 25, 2022 (our “Annual Report on Form 20-F”), including, but not limited to, those described under Item 3.D. “Risk Factors”.
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In addition, our future results may be impacted by various government-mandated economic restrictions resulting from the ongoing COVID-19 pandemic and the related global reduction in commerce and travel and substantial volatility in stock markets worldwide, which may negatively impact our revenues, affect our ability to identify and complete future transactions, impact our liquidity position and result in a decrease of cash flows and impairment losses and/or revaluations on our investments and assets, and therefore we may be unable to achieve our expected returns. See “Risks Associated with the COVID-19 Pandemic” in the “Risk Factors” section included in our Annual Report on Form 20-F.
Statements relating to “reserves” are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described herein can be profitably produced in the future. We qualify any and all of our forward-looking statements by these cautionary factors.
We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements or information, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.
The foregoing factors and others are discussed in detail under the heading “Risk Factors” in our Annual Report on Form 20-F. New risk factors may arise from time to time and it is not possible to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance or achievements of our company to be materially different from those contained in forward-looking statements or information. Given these risks and uncertainties, investors and other readers should not place undue reliance on forward-looking statements or information as a prediction of actual results. Although the forward-looking statements and information contained in this prospectus and our Annual Report on Form 20-F are based upon what we believe to be reasonable assumptions, we cannot assure investors that actual results will be consistent with these forward-looking statements and information, particularly in light of government-mandated economic restrictions resulting from the COVID-19 pandemic in certain jurisdictions in which we operate. These forward-looking statements are made and this forward-looking information is provided as of the date of this prospectus, and except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.
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SUMMARY
This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that you should consider before deciding to invest in units. You should read this entire prospectus carefully, including the “Risk Factors” section and the documents incorporated by reference herein.
Brookfield Business Partners L.P.
We are a Bermuda exempted limited partnership that was established on January 18, 2016 under the provisions of the Bermuda Limited Partnership Act 1883, as amended, and the Bermuda Exempted Partnerships Act 1992, as amended. Our head and registered office is 73 Front Street, 5th Floor, Hamilton HM 12, Bermuda, and the telephone number is +1-441-295-1443.
The partnership was established by Brookfield to be its flagship public partnership for its business services and industrials operations. Our operations are primarily located in Canada, Australia, the United Kingdom, the United States, India and Brazil. The partnership is focused on owning and operating high-quality operations that benefit from a strong competitive position and provide essential products and services. The partnership seeks to build value through enhancing the cash flows of its business, pursuing an operations-oriented acquisition strategy and opportunistically recycling capital generated from operations and dispositions into our existing operations, new acquisitions and investments. The partnership’s goal is to generate returns to unitholders primarily through capital appreciation with a modest distribution yield. The partnership’s sole direct investment is a managing general partnership interest in Brookfield Business L.P. (“Holding LP”), which holds the partnership’s business services and industrial operations assets through Holding LP’s subsidiaries and operating entities.
The units are listed on the NYSE and the TSX. For additional information, see our Annual Report on Form 20-F, which is incorporated by reference into this prospectus.
Brookfield Business Corporation
BBUC is a corporation incorporated under, and governed by, the laws of British Columbia, Canada. As of the date of this prospectus, BBUC’s operations consist of services and industrial operations primarily located in Australia, the United Kingdom, the United States and Brazil, which BBUC acquired prior to the Special Distribution.
On March 15, 2022, approximately 38.2 million exchangeable shares were distributed to holders of units and additionally 34.9 million exchangeable shares were distributed to Brookfield and its subsidiaries (other than the partnership, BBUC and their respective subsidiaries) (such distributions, collectively, the “Special Distribution”). Each exchangeable share has been structured with the intention of providing an economic return equivalent to one unit (subject to adjustment to reflect certain capital events). BBUC will target to pay dividends per exchangeable share that are identical to the distributions paid on each unit, and each exchangeable share will be exchangeable at the option of the holder for one unit (subject to adjustment to reflect certain capital events) or its cash equivalent, as more fully described in this prospectus.
Brookfield has entered into a rights agreement (the “rights agreement”) pursuant to which Brookfield has agreed that, until the fifth anniversary of the date of the Special Distribution, in the event that, on the applicable specified exchange date with respect to any subject exchangeable shares, (i) BBUC has not satisfied its obligation under its articles and notice of articles (the “BBUC articles”) of delivering the unit amount or its cash equivalent amount and (ii) we have not, upon our election in our sole and absolute discretion, acquired such subject exchangeable shares from the holder thereof and delivered the unit amount or its cash equivalent, Brookfield will satisfy, or cause to be satisfied, the obligations pursuant to the BBUC articles to exchange such subject exchangeable shares for the unit amount or its cash equivalent. The holders of exchangeable shares have a right to receive the unit amount or its cash equivalent in such circumstances. The partnership will pay all expenses of effecting the exchanges pursuant to this prospectus. See “Exchange Rights of Exchangeable Shares for Units” for more information.
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BBU Units
As of April 25, 2022, there were 75,734,895 units and 69,705,497 redeemable/exchangeable partnership units of Holding LP (each, a “redemption/exchange unit”) outstanding.
The redemption/exchange units are subject to a redemption-exchange mechanism pursuant to which units may be issued in exchange for redemption/exchange units on a one for one basis. All of the redemption/ exchange units are currently owned by Brookfield.
Tax Consequences of Exchanges and Ownership of units
Please see “Material Canadian Federal Income Tax Considerations” and “Material United States Federal Income Tax Considerations” for a summary of material Canadian and U.S. federal income tax considerations that may be relevant to holders of exchangeable shares if such holders exchange their exchangeable shares for units. Because the specific tax consequences to such holders will depend upon their specific circumstances, holders are strongly urged to consult their own tax advisors regarding any Canadian and/or U.S. federal, state and local tax consequences specific to such holders.
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RISK FACTORS
An investment in units involves a high degree of risk. Before making an investment decision, you should carefully consider the risks incorporated by reference from our Annual Report on Form 20-F and the other information incorporated by reference in this prospectus, as updated by our subsequent filings with the SEC, pursuant to Sections 13(a), 14 or 15(d) of the Exchange Act of 1934, as amended (the “Exchange Act”), which are incorporated in this prospectus. The risks and uncertainties described therein and herein are not the only risks and uncertainties we face. In addition, please consider the following risks before making an investment decision: See “Where You Can Find More Information” and “Incorporation by Reference.”
The exchange of exchangeable shares for units may result in the U.S. federal income taxation of any gain realized by a U.S. holder.
Depending on the facts and circumstances, the exchange of exchangeable shares for units by a U.S. holder may result in the U.S. federal income taxation of any gain realized by the U.S. holder. In general, a U.S. holder exchanging exchangeable shares for units pursuant to the exercise of the exchange right will recognize capital gain or loss (i) if the exchange request is satisfied by the delivery of units by Brookfield pursuant to the rights agreement or (ii) if the exchange request is satisfied by the delivery of units by BBUC and the exchange is, within the meaning of Section 302(b) of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), in “complete redemption” of the U.S. holder’s equity interest in BBUC, a “substantially disproportionate” redemption of stock, or “not essentially equivalent to a dividend,” applying certain constructive ownership rules that take into account not only the exchangeable shares and other equity interests in BBUC actually owned but also other equity interests in BBUC treated as constructively owned by the U.S. holder for U.S. federal income tax purposes. If an exchange request satisfied by the delivery of units by BBUC is not treated as a sale or exchange under the foregoing rules, then it will be treated as a distribution equal to the amount of cash and the fair market value of the units received, taxable under the rules generally applicable to distributions on stock of a corporation.
In general, if the partnership satisfies an exchange request by delivering units to a U.S. holder pursuant to the partnership’s exercise of the partnership call right, then the U.S. holder’s exchange of exchangeable shares for units will qualify as tax-free under Section 721(a) of the Code, unless, at the time of such exchange, the partnership (i) is a publicly traded partnership treated as a corporation or (ii) would be an “investment company” if it were incorporated for purposes of Section 721(b) of the Code. In the case described in (i) or(ii) of the preceding sentence, a U.S. holder may recognize gain upon the exchange. The general partner of the partnership believes that the partnership will be treated as a partnership and not as a corporation for U.S. federal income tax purposes. In addition, based on the shareholders’ rights in the event of the liquidation or dissolution of BBUC (or the partnership) and the terms of the exchangeable shares, which are intended to provide an economic return equivalent to the economic return on units (including identical distributions), and taking into account the expected relative values of the partnership’s assets and its ratable share of the assets of its subsidiaries for the foreseeable future, the general partner of the partnership currently expects that a U.S. holder’s exchange of exchangeable shares for units pursuant to the exercise of the partnership call right will not be treated as a transfer to an investment company for purposes of Section 721(b) of the Code. Accordingly, the general partner of the partnership currently expects a U.S. holder’s exchange of exchangeable shares for units pursuant to the partnership’s exercise of the partnership call right to qualify as tax-free under Section 721(a) of the Code. However, no definitive determination can be made as to whether any such future exchange will qualify as tax-free under Section 721(a) of the Code, as this will depend on the facts and circumstances at the time of the exchange. Many of these facts and circumstances are not within the control of the partnership, and no assurance can be provided as to the position, if any, taken by the general partner of the partnership with regard to the U.S. federal income tax treatment of any such exchange. Nor can any assurance be given that the IRS will not assert, or that a court would not sustain, a position contrary to any future position taken by the partnership. If Section 721(a) of the Code does not apply, then a U.S. holder who exchanges exchangeable shares for units pursuant to the partnership’s exercise of the partnership call right will be treated as if the holder had sold its exchangeable shares to the partnership in a taxable transaction for cash in an amount equal to the value of the units received.
Even if a U.S. holder’s transfer of exchangeable shares in exchange for units pursuant to the partnership’s exercise of the partnership call right qualifies as tax-free under Section 721(a) of the Code, the U.S. holder will
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be subject to special rules that may result in the recognition of additional taxable gain or income. Under Section 704(c)(1) of the Code, if appreciated property is contributed to a partnership, the contributing partner must recognize any gain that was realized but not recognized for U.S. federal income tax purposes with respect to the property at the time of the contribution (referred to as “built-in gain”) if the partnership sells such property (or otherwise transfers such property in a taxable exchange) at any time thereafter or distributes such property to another partner within seven years of the contribution in a transaction that does not otherwise result in the recognition of built-in gain by the partnership. Under Section 737 of the Code, the U.S. holder could be required to recognize built-in gain if the partnership were to distribute any property of the partnership other than money (or, in certain circumstances, exchangeable shares) to such former holder of exchangeable shares within seven years of exercise of the partnership call right. Under Section 707(a) of the Code, the U.S. holder could also be required to recognize built-in gain if the partnership were to make distributions (other than “operating cash flow distributions,” unless another exception were to apply) to the U.S. holder within two years of exercise of the partnership call right. If a distribution to a U.S. holder within two years of the transfer of exchangeable shares in exchange for units is treated as part of a deemed sale transaction under Section 707(a) of the Code, the U.S. holder will recognize gain or loss in the year of the transfer of exchangeable shares in exchange for units, and, if the U.S. holder has already filed a tax return for such year, the holder may be required to file an amended return. In such a case, the U.S. holder may also be required to report some amount of imputed interest income.
For a more complete discussion of the U.S. federal income tax consequences of the exchange of exchangeable shares for units, see “Material United States Federal Income Tax Considerations” below. The U.S. federal income tax consequences of exchanging exchangeable shares for units are complex, and each U.S. holder should consult its tax advisor regarding such consequences in light of the holder’s particular circumstances.
Canadian federal income tax considerations described herein may be materially and adversely impacted by certain events.
If BBUC ceases to qualify as a “mutual fund corporation” under the Tax Act (as defined below), the income tax considerations described under the heading “Material Canadian Federal Income Tax Considerations” would be materially and adversely different in certain respects.
In general, there can be no assurance that Canadian federal income tax laws respecting the treatment of mutual fund corporations or otherwise respecting the treatment of BBUC, the partnership and the exchange of exchangeable shares for units as described in this prospectus will not be changed in a manner that adversely affects shareholders or unitholders, or that such tax laws will not be administered in a way that is less advantageous to BBUC, the partnership, shareholders or unitholders.
Your investment may change upon an exchange of exchangeable shares for units.
If you exchange exchangeable shares pursuant to the terms set forth the BBUC articles or the rights agreement, you may receive units or cash in exchange for such exchangeable shares. To the extent that you receive units in any such exchange, you will become a holder of limited partnership units of a Bermuda limited partnership rather than a holder of a security of a British Columbia corporation. We are organized as an exempted limited partnership under the laws of Bermuda, whereas BBUC is organized as a British Columbia corporation. Therefore, recipients of units following an exchange of exchangeable shares for units will have different rights and obligations, including voting rights, from those that they had prior to the consummation of the exchange as a holder of exchangeable shares. See “Comparison of Rights of Holders of Exchangeable Shares and Units.” Although the exchangeable shares are intended to provide an economic return, including with respect to distributions, equivalent to units, we can provide no assurance that the units will trade at comparable market prices to the exchangeable shares.
The units may not trade at the same price as the exchangeable shares.
Although the exchangeable shares are intended to provide an economic return that is equivalent to units, there can be no assurance that the market price of units will be equal to the market price of exchangeable shares at any time. Factors that could cause differences in such market prices may include:
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•
perception and/or recommendations by analysts, investors and/or other third parties that these securities should be priced differently;
​
•
actual or perceived differences in dividends to holders of exchangeable shares versus distributions to holders of units, including as a result of any legal prohibitions;
​
•
business developments or financial performance or other events or conditions that may be specific to only the partnership or BBUC; and
​
•
difficulty in the exchange mechanics between exchangeable shares and units, including any delays or difficulties experienced by the transfer agent in processing the exchange requests.
​
Any holder requesting an exchange of their exchangeable shares for which BBUC or the partnership elects to provide units in satisfaction of the exchange amount may experience a delay in receiving such units, which may affect the value of the units the holder receives in an exchange.
Each exchangeable share will be exchangeable at the option of the holder for one unit (subject to adjustment to reflect certain capital events) or its cash equivalent (the form of payment to be determined at the election of BBUC or the partnership). See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”. In the event cash is used to satisfy an exchange request, the amount payable per exchangeable share will be equal to the NYSE closing price of one unit on the date that the request for exchange is received by the transfer agent. As a result, any decrease in the value of the units after that date will not affect the amount of cash received. However, any holder whose exchangeable shares are exchanged for units will not receive such units for up to ten (10) business days after the applicable request is received. During this period, the market price of units may decrease. Any such decrease would affect the value of the unit consideration to be received by the holder of exchangeable shares on the effective date of the exchange.
Further, the partnership will be required to maintain an effective registration statement in the United States in order to exchange any exchangeable shares for units. If a registration statement with respect to the units issuable upon any exchange, redemption or acquisition of exchangeable shares (including in connection with any liquidation, dissolution or winding up of BBUC) is not current or is suspended for use by the SEC, no exchange or redemption of exchangeable shares for units may be effected during such period.
Exchanges of exchangeable shares for units may negatively affect the market price of units, and additional issuances of exchangeable shares would be dilutive to units.
Each exchangeable share will be exchangeable by the holder thereof for one unit (subject to adjustment to reflect certain capital events) or its cash equivalent (the form of payment to be determined at the election of our group). See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”. If our group elects to deliver units in satisfaction of any such exchange request, a significant number of additional units may be issued from time to time which could have a negative impact on the market price for units. Additionally, any exchangeable shares issued by BBUC in the future will also be exchangeable for units, and, accordingly, any future exchanges satisfied by the delivery of units would dilute the percentage interest of existing holders of units and may reduce the market price of units.
Our group has the right to elect whether holders of exchangeable shares receive cash or units upon a liquidation or exchange event.
In the event that (i) there is a liquidation, dissolution or winding up of BBUC or the partnership, (ii) BBUC or the partnership exercises its right to redeem (or cause the redemption of) all of the then outstanding exchangeable shares, or (iii) a holder of exchangeable shares requests an exchange of exchangeable shares, holders of exchangeable shares shall be entitled to receive one unit per exchangeable share held (subject to adjustment to reflect certain capital events and certain other payment obligations in the case of a liquidation, dissolution or winding up of BBUC or the partnership) or its cash equivalent. The form of payment will be determined at the election of our group so holders of exchangeable shares will not know whether cash or units will be delivered in connection with any of the events described above. BBUC and the partnership currently intend to satisfy any exchange requests on the exchangeable shares through the delivery of units rather than cash.
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BBUC or the partnership may issue additional exchangeable shares or units, respectively, in the future, including in lieu of incurring indebtedness, which may dilute holders of our group’s equity securities. BBUC or the partnership may also issue securities that have rights and privileges that are more favorable than the rights and privileges accorded to our group’s equity holders.
Subject to the terms of any of BBUC securities then outstanding, BBUC may issue additional securities, including exchangeable shares, BBUC class B shares, BBUC class C shares, preference shares, options, rights and warrants for any purpose and for such consideration and on such terms and conditions as BBUC’s board may determine. Subject to the terms of any of BBUC securities then outstanding, BBUC’s board will be able to determine the class, designations, preferences, rights, powers and duties of any additional securities, including any rights to share in BBUC’s profits, losses and dividends, any rights to receive BBUC’s assets upon its dissolution or liquidation and any redemption, conversion and exchange rights. Subject to the terms of any of BBUC securities then outstanding, BBUC’s board may use such authority to issue such additional securities, which would dilute holders of such securities, or to issue securities with rights and privileges that are more favorable than those of the exchangeable shares.
Similarly, under our limited partnership agreement, subject to the terms of any preferred units then outstanding, the general partner may issue additional partnership securities, including units, preferred units, options, rights, warrants and appreciation rights relating to partnership securities for any purpose and for such consideration and on such terms and conditions as the board of the general partner may determine. Subject to the terms of any partnership securities then outstanding, the board of the general partner will be able to determine the class, designations, preferences, rights, powers and duties of any additional partnership securities, including any rights to share in partnership’s profits, losses and dividends, any rights to receive the partnership’s assets upon its dissolution or liquidation and any redemption, conversion and exchange rights. Subject to the terms of any partnership securities then outstanding, the board of the general partner may use such authority to issue such additional partnership securities, which would dilute holders of such securities, or to issue securities with rights and privileges that are more favorable than those of units.
The sale or issuance of a substantial number of exchangeable shares, units or other equity securities of BBUC or the partnership in the public markets, or the perception that such sales or issuances could occur, could depress the market price of units and impair the partnership’s ability to raise capital through the sale of additional units. We cannot predict the effect that future sales or issuances of exchangeable shares, units or other equity securities would have on the market price of units. Subject to the terms of any of our securities then outstanding, holders of units will not have any pre-emptive right or any right to consent to or otherwise approve the issuance of any securities or the terms on which any such securities may be issued.
The rights agreement may terminate on the fifth anniversary of the distribution date.
This rights agreement will terminate on the fifth anniversary of the date of the Special Distribution unless the rights agreement is otherwise terminated pursuant to its terms. After such date, holders of exchangeable shares may no longer have the benefit of protections provided for by the rights agreement and will be reliant on the rights provided for in the BBUC articles. In the event that BBUC or the partnership fails to satisfy a request for exchange after the expiry of the rights agreement, a tendering holder will not be entitled to rely on the Secondary Exchange Rights (as defined herein). See “Exchange of Exchangeable Shares for Units”.
Our limited partnership agreement will provide that the federal district courts of the United States of America are the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. This choice of forum provision could limit our unitholders ability to obtain a favorable judicial forum for disputes with directors, officers or employees.
Our limited partnership agreement provides that, unless the partnership consents in writing to the selection of an alternative forum, the federal district courts of the United States, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. In the absence of this provision, under the Securities Act, U.S. federal and state courts have been found to have concurrent jurisdiction over suits brought to enforce duties or liabilities created by the Securities Act. This choice of forum provision does not apply to suits brought to enforce duties or liabilities created by the Exchange Act, which already provides that such federal district courts have exclusive
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jurisdictions over such suits.  Additionally, investors cannot waive our compliance with federal securities laws of the United States and the rules and regulations thereunder.
The choice of forum provision contained in our limited partnership agreement may limit our unitholders’ ability to bring a claim in a judicial forum that it finds favorable for disputes with the partnership or its directors, officers or other employees, which may discourage such lawsuits against the partnership and its directors, officers and other employees. However, the enforceability of similar choice of forum provisions in other companies’ governing documents has been challenged in recent legal proceedings, and it is possible that a court in the relevant jurisdictions with respect to the partnership could find the choice of forum provision that will be contained in our limited partnership agreement to be inapplicable or unenforceable. While the Delaware Supreme Court ruled in March 2020 that U.S. federal forum selection provisions purporting to require claims under the Securities Act be brought in a U.S. federal court are “facially valid” under Delaware law, there can be no assurance that the courts in Bermuda, and other courts within the United States, reach a similar determination regarding the choice of forum provision contained in our limited partnership agreement. If the relevant court were to find the choice of forum provision contained in our limited partnership agreement to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition and operating results.
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USE OF PROCEEDS
None of the partnership, BBUC or Brookfield will receive any cash proceeds from the issuance or delivery of any units upon exchange, redemption or acquisition, as applicable, of exchangeable shares pursuant to this prospectus. See “Exchange of Exchangeable Shares for Units” below.
CAPITALIZATION
The following tables set forth (i) the partnership’s cash and capitalization as at December 31, 2021, on an actual basis and after giving effect to the Special Distribution and the transfer of certain business services and industrials operations from the partnership to BBUC as though it had occurred on December 31, 2021; and (ii) the partnership’s net income (loss), net income attributable to unitholders and non-controlling interest attributable to exchangeable shares, and basic and diluted earnings per unit attributable to limited partners, for the year ended December 31, 2021, on an actual basis and as if the Special Distribution and the transfer of certain business services and industrials operations from the partnership took place on January 1, 2021.
US$ MILLIONS, EXCEPT PER UNIT AMOUNTS
​ ​
Actual
​ ​
As adjusted to
give effect to
the Special
Distribution
​
As at December 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Cash and cash equivalents
​ ​ ​ ​ 2,588 ​ ​ ​ ​ ​ 2,588 ​ ​
Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Limited partners ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Limited partners
​ ​ ​ ​ 2,252 ​ ​ ​ ​ ​ 1,495 ​ ​
Non-controlling interest ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Redemption-exchange units held by Brookfield
​ ​ ​ ​ 2,011 ​ ​ ​ ​ ​ 1,352 ​ ​
Special limited partners
​ ​ ​ ​ — ​ ​ ​ ​ ​ — ​ ​
Preferred shares
​ ​ ​ ​ 15 ​ ​ ​ ​ ​ 15 ​ ​
Interest of others in operating subsidiaries
​ ​ ​ ​ 8,722 ​ ​ ​ ​ ​ 8,722 ​ ​
BBUC exchangeable shares
​ ​ ​ ​ — ​ ​ ​ ​ ​ 1,416 ​ ​
Total equity
​ ​ ​ ​ 13,000 ​ ​ ​ ​ ​ 13,000 ​ ​
US$ MILLIONS, EXCEPT PER UNIT AMOUNTS
​ ​
Actual
​ ​
As adjusted to
give effect to
the Special
Distribution
​
For the year ended December 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Net income (loss)
​ ​ ​ ​ 2,153 ​ ​ ​ ​ ​ 2,153 ​ ​
Attributable to: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
Limited partners
​ ​ ​ ​ 258 ​ ​ ​ ​ ​ 172 ​ ​
Non-controlling interest: ​ ​ ​
Redemption-exchange units held by Brookfield
​ ​ ​ ​ 228 ​ ​ ​ ​ ​ 153 ​ ​
Special limited partners
​ ​ ​ ​ 157 ​ ​ ​ ​ ​ 157 ​ ​
Interest of others in operating subsidiaries
​ ​ ​ ​ 1,510 ​ ​ ​ ​ ​ 1,510 ​ ​
BBUC exchangeable shares
​ ​ ​ ​ — ​ ​ ​ ​ ​ 161 ​ ​
Basic and diluted earnings (loss) per limited partner unit
​ ​ ​ ​ 3.28 ​ ​ ​ ​ ​ 2.20 ​ ​
For additional information with respect to the partnership, see “Where You Can Find More Information” and “Documents Incorporated by Reference”.
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EXCHANGE OF EXCHANGEABLE SHARES FOR UNITS
The exchange rights relating to the exchangeable shares are set forth in the BBUC articles and the rights agreement, which are filed as exhibits to the registration statement of which this prospectus forms a part. Upon exchange, holders of exchangeable shares will receive, with respect to each exchanged share, either (i) one unit or (ii) cash in an amount equivalent to the market value of one unit, in each case as described in further detail below.
Primary Exchange Rights
Holders of exchangeable shares shall have the right to exchange all or a portion of their exchangeable shares for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership as described below in “— Adjustments to Reflect Certain Capital Events”) or its cash equivalent based on the NYSE closing price of one unit on the date that the request for exchange is received by BBUC’s transfer agent (or if not a trading day, the next trading day thereafter) plus all unpaid dividends, if any (the form of payment to be determined at the sole election of our group). Holders of exchangeable shares that hold such shares through a broker must contact their brokers to request an exchange on their behalf. Holders of exchangeable shares that are registered holders must contact BBUC’s transfer agent and follow the process described below.
Each holder of exchangeable shares who wishes to exchange one or more of his or her exchangeable shares for units or its cash equivalent is required to complete and deliver a notice of exchange in the form available from BBUC’s transfer agent. Upon receipt of a notice of exchange, BBUC shall, within ten (10) business days after the date that the notice of exchange is received by BBUC’s transfer agent, deliver to the tendering holder of exchangeable shares, in accordance with instructions set forth in the notice of exchange, one unit per exchangeable share held (subject to adjustments in the event of certain dilutive or other capital events by BBUC or the partnership as described below in “— Adjustments to Reflect Certain Capital Events”) or its cash equivalent based on the NYSE closing price of one unit on the date that the request for exchange is received by BBUC’s transfer agent (or if not a trading day, the next trading day thereafter) plus all unpaid dividends, if any (the form of payment to be determined at the sole election of BBUC). Upon completion of the exchange of any exchangeable shares as described herein, the holder of exchangeable shares who has exchanged their exchangeable shares will have no further right, with respect to any exchangeable shares so exchanged, to receive any dividends on exchangeable shares with a record date on or after the date on which such exchangeable shares are exchanged.
Notwithstanding the paragraph above, when a notice of exchange has been delivered to each of BBUC and the partnership and, until such time as the rights agreement is terminated, Brookfield, by BBUC’s transfer agent on behalf of a tendering holder of exchangeable shares, BBUC will promptly, and in any event, within one (1) business day after receipt thereof, deliver to each of Brookfield and the partnership a written notification of BBUC’s receipt of such notice of exchange setting forth the identity of the holder of exchangeable shares who wishes to exchange such exchangeable shares and the number of exchangeable shares to be exchanged. We may elect to satisfy our exchange obligation by acquiring all of the tendered exchangeable shares in exchange for one unit per exchangeable share held (subject to adjustments in the event of certain dilutive or other capital events by BBUC or the partnership as described below in “— Adjustments to Reflect Certain Capital Events”) or its cash equivalent based on the NYSE closing price of one unit on the date that the request for exchange is received by BBUC’s transfer agent (or if not a trading day, the next trading day thereafter) plus all unpaid dividends, if any (the form of payment to be determined at the sole election of the partnership). If we elect to satisfy our exchange obligation, we shall, within three (3) business days from the receipt of the holder’s notice of exchange, provide written notice to BBUC’s transfer agent of our intention to satisfy the exchange obligation and shall satisfy such obligation within ten (10) business days from the date that the notice of exchange is received by BBUC’s transfer agent by delivering to such holder of exchangeable shares the units or its cash equivalent. Our unitholders are not entitled to vote on the partnership’s exercise of the overriding call right described in the preceding sentences.
In the event that a tendering holder of exchangeable shares has not received the number of units or its cash equivalent (the form of payment to be determined by BBUC or the partnership in each of their sole discretion) in satisfaction of the tendered exchangeable shares, then such tendering holder of exchangeable shares will be entitled to receive the equivalent of such cash amount or units amount from Brookfield pursuant
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to the rights agreement until the fifth anniversary of the date of the Special Distribution. In this scenario, the tendered exchangeable shares will be delivered to the rights agent (as defined below) in exchange for the delivery of the equivalent of the cash amount or units amount from a collateral account of Brookfield administered by the rights agent. See the section entitled “— Secondary Exchange Rights” for a further description of the rights agreement. The partnership has agreed to indemnify Brookfield, in its capacity as selling securityholder, for certain liabilities under applicable securities laws concerning selling securityholders, in connection with any units delivered by Brookfield pursuant to the rights agreement.
No Fractional Units.   No fractional units will be issued or delivered upon exchange of exchangeable shares. In lieu of any fractional units to which the tendering holder of exchangeable shares would otherwise be entitled at our group’s election, our group will pay an amount in cash equal to the unit value on the trading day immediately preceding the exchange date multiplied by such fraction of a unit.
Adjustments to Reflect Certain Capital Events.   The conversion factor (which as of the date of this prospectus is one) is subject to adjustment in accordance with the BBUC articles to reflect certain capital events, including (i) if the partnership or BBUC declares or pays a distribution to its unitholders consisting wholly or partly of units or a dividend to its shareholders consisting wholly or partly of exchangeable shares, as applicable, without a corresponding distribution or dividend, as applicable, being declared or paid by the other entity; (ii) if the partnership or BBUC splits, subdivides, reverse-splits or combines its outstanding units or exchangeable shares, as applicable, without a corresponding event occurring at the other entity; (iii) if the partnership or BBUC distributes any rights, options or warrants to all or substantially all holders of its units or exchangeable shares to convert into, exchange for or subscribe for or to purchase or to otherwise acquire units or exchangeable shares (or other securities or rights convertible into, exchangeable for or exercisable for units or exchangeable shares), as applicable, without a corresponding distribution of rights, options or warrants by the other entity; (iv) if the partnership distributes to all or substantially all holders of units evidences of its indebtedness or assets (including securities), or assets or rights, options or warrants to convert into, exchange for or subscribe for or to purchase or to otherwise acquire such securities but excluding all distributions where a comparable distribution (or the cash equivalent) is made by BBUC; or (v) if the partnership or one of its subsidiaries makes a payment in respect of a tender or exchange offer for the units (but excluding for all purposes any exchange or tender offer to exchange units for exchangeable shares or any other security economically equivalent to units), to the extent that the cash and value of any other consideration included in the payment per unit exceeds certain thresholds.
Secondary Exchange Rights
Brookfield has entered into the rights agreement with the Wilmington Trust, National Association (the “rights agent”), pursuant to which Brookfield has agreed that, until the fifth anniversary of the date of the Special Distribution, upon an exchange of exchangeable shares, if BBUC has not satisfied its obligation under the BBUC articles by delivering the unit amount or its cash equivalent amount (or the partnership has not exercised its call right), Brookfield will satisfy, or cause to be satisfied, the obligations pursuant to the BBUC articles to exchange such exchangeable shares for the unit amount or its cash equivalent. Brookfield currently intends to satisfy any exchange requests on the exchangeable shares through the delivery of units rather than cash. The Master Services Agreement between Brookfield, the partnership, Holding LP and others provides, so long as Brookfield is a party to the rights agreement, Brookfield shall have a consent right prior to the issuance by BBUC of any exchangeable shares, subject to certain exceptions.
Appointment of Rights Agent; Term.   The rights agent has agreed to act as the rights agent for the holders, as a class and not individually, of the exchangeable shares. Pursuant to and subject to the terms and conditions set forth in the BBUC articles, a holder of exchangeable shares may request to exchange each exchangeable share (the “subject exchangeable share”) for one unit per exchangeable share held (subject to adjustment to reflect certain capital events or its cash equivalent (the form of payment to be determined at the election of our group) — see “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events” above). Upon receipt of a notice of exchange, BBUC shall, within ten (10) business days after the date that the notice of exchange is received by BBUC’s transfer agent (the “specified exchange date”) deliver to the tendering holder of exchangeable shares, such unit or cash amount. Pursuant to the rights agreement, Brookfield has agreed that, in the event that, on the applicable specified exchange date with respect to any subject exchangeable shares, (i) BBUC has not satisfied its obligation under the BBUC articles by delivering the unit or cash amount
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and (ii) the partnership has not, upon its election in its sole and absolute discretion, acquired such subject exchangeable share from the holder thereof and delivered the unit or cash amount, Brookfield will satisfy, or cause to be satisfied, the obligations pursuant to the BBUC articles to exchange such subject exchangeable shares for the unit amount or the cash amount. The holders of exchangeable shares have a right to receive the unit amount or the cash amount in such circumstances (the “Secondary Exchange Rights”).
The Secondary Exchange Rights are a part of the terms of the exchangeable shares and may not be evidenced, transferred or assigned separate or apart from the exchangeable shares.
This rights agreement will terminate on the fifth anniversary of the date of the Special Distribution, unless otherwise terminated pursuant to its terms as described below.
Satisfaction of Secondary Exchange Rights.   In accordance with the rights agreement, Brookfield has agreed to satisfy, or cause to be satisfied, the obligations with respect to the Secondary Exchange Rights contained in the BBUC articles. The rights agent established a collateral account in order to enable the rights agent to exchange subject exchangeable shares for the cash amount or the unit amount in accordance with the rights agreement.
In accordance with the BBUC articles, BBUC is required to deliver a notice (the “BBUC notice”) to the rights agent and Brookfield on the specified exchange date if the conditions to the exercise of the Secondary Exchange Rights with respect to any subject exchangeable shares have been satisfied. The BBUC notice must set forth the unit amount and the cash amount for such subject exchangeable shares and any necessary wire transfer or other delivery instructions. Brookfield may provide notice to the rights agent by the business day immediately following receipt of the BBUC notice, providing that Brookfield has elected, in Brookfield’s sole discretion, to fund the cash amount. If the rights agent has not received such notice from Brookfield, the rights agent must exchange the subject exchangeable shares for a number of units held in the collateral account equal to the unit amount and promptly, and in any event within two (2) business days, deliver such units from the collateral account to the holder of the subject exchangeable shares. If there are not enough units in the collateral account to satisfy the unit amount with respect to one or more of such subject exchangeable shares, the rights agent will exchange such subject exchangeable shares for an amount of cash from the collateral account equal to the cash amount and promptly, and in any event within two (2) business days, deliver the cash amount to the holder of the subject exchangeable shares.
If the holder of subject exchangeable shares has not received the units amount or the cash amount by the specified exchange date, the holder of subject exchangeable shares may deliver, or cause to be delivered, a notice (the “exchanging shareholder notice”) to the rights agent and Brookfield. The exchanging shareholder notice must set forth the number of such subject exchangeable shares and any necessary wire transfer or other delivery instructions and be in a format that is acceptable to the rights agent. As promptly as practicable and in any event on or prior to the next business day following receipt of the exchanging shareholder notice, Brookfield will provide notice to the rights agent (i) setting forth the unit amount and the cash amount for such subject exchangeable shares and (ii) either (a) providing that Brookfield has elected, in Brookfield’s sole discretion, to fund the cash amount or (b) instructing the rights agent to exchange each subject exchangeable share. Brookfield is not obligated to deliver such notice if it has determined in good faith that the conditions to the exercise of the Secondary Exchange Right have not been satisfied. On or prior to the second business day following receipt by the rights agent of such instruction by Brookfield, the exchanging shareholder notice and the subject exchangeable shares, the rights agent will exchange such subject exchangeable shares for the unit amount from the collateral account or, if there are not enough units in the collateral account, for the cash amount from the collateral account.
With respect to any exchange of subject exchangeable shares, Brookfield may elect to instruct the rights agent to exchange the subject exchangeable shares for the cash amount. If Brookfield makes such an election and there is not a sufficient amount of cash in the collateral account, Brookfield must deposit the required amount into the collateral account simultaneously with such election.
In connection with the exercise by a holder of the Secondary Exchange Rights with respect to any subject exchangeable shares held through the Depository Trust Company (“DTC”), such holder will deliver to the rights agent such subject exchangeable shares pursuant to DTC’s applicable procedures. In addition, such holder will deliver to the rights agent via e-mail on the business day prior to delivery of such subject exchangeable shares a copy of the exchanging shareholder notice, if applicable.
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Receipt of Subject Exchangeable Shares; Withholding.   Holders of subject exchangeable shares will deliver such shares free and clear of all liens, claims and encumbrances, and should any such liens, claims and encumbrances exist with respect to such subject exchangeable shares, the holder of such subject exchangeable shares will not be entitled to exercise its Secondary Exchange Rights with respect to such shares. Each holder of subject exchangeable shares will pay to Brookfield the amount of any tax withholding due upon the exchange of such shares and, in the event Brookfield elects to acquire some or all of the subject exchangeable shares in exchange for the cash amount, will authorize Brookfield to retain a portion of the cash amount to satisfy tax withholding obligations. If Brookfield elects to acquire some or all of the subject exchangeable shares in exchange for the unit amount, Brookfield may elect to either satisfy the amount of any tax withholding by retaining units with a fair market value equal to the amount of such obligation, or satisfy such tax withholding obligation using amounts paid by Brookfield, which amounts will be treated as a loan by Brookfield to the holder of the subject exchangeable shares, in each case, unless the holder, at the holder’s election, has made arrangements to pay the amount of any such tax withholding.
Units Record Date.   Each former holder of subject exchangeable shares who receives the unit amount will be deemed to have become the owner of the units as of the date upon which such subject exchangeable shares are duly surrendered in accordance with the rights agreement.
Collateral Account.   Brookfield or its affiliates have established a non-interest bearing trust account to be administered by the rights agent (the “collateral account”). At all times on and after the date of issuance of any exchangeable shares by BBUC, Brookfield will ensure that the aggregate of (i) the units in or issuable pursuant to any convertible securities in the collateral account (the “collateral account unit balance”) and (ii) the number of units equal to the aggregate amount of cash in the collateral account divided by the value of a unit (the “collateral cash balance” and, together with the collateral account unit balance, the “collateral account balance”) will at all times be equal to or exceed the number of units that is equal to the product of the total number of exchangeable shares outstanding (excluding those owned by Brookfield or its affiliates) multiplied by the conversion factor in accordance with the BBUC articles (the “required collateral account balance”).
If the collateral account balance is at any time less than the required collateral account balance, Brookfield will, within two (2) business days, deposit or cause to be deposited into the collateral account either (i) a number of units or any security convertible into or redeemable for units (other than exchangeable shares) (the “unit convertibles”), or (ii) an amount of cash or cash equivalents, in each case in an amount necessary to cause the collateral account balance to be at least equal to the required collateral account balance. To the extent that conversion or redemption of a unit convertible results in the imposition of any fees, payments, premiums or penalties, such fees, payments, premiums or penalties will be borne by Brookfield or its affiliates, and must either be satisfied directly by Brookfield or such affiliates or will be deemed to reduce the collateral account balance. Brookfield must keep the rights agent informed of the collateral account balance and the required collateral account balance in writing on a regular basis, and must inform the rights agent in writing within two (2) business days of any change in the collateral account balance or the required collateral account balance for any reason, including as a result of an adjustment to the conversion factor pursuant to the BBUC articles.
Brookfield and its affiliates will not be entitled to withdraw any unit or unit convertible from the collateral account, except (i) if the collateral account balance exceeds the required collateral account balance, either as a result of a change in the conversion factor pursuant to the BBUC articles or a decrease in the number of exchangeable shares outstanding (excluding exchangeable shares held by Brookfield or its affiliates) or (ii) upon the deposit by Brookfield or its affiliates of an amount in cash or cash equivalents equal to one hundred and fifty percent (150%) of the value of the units withdrawn.
If the collateral account contains any amount of cash in lieu of units, such cash amount is required to be no less than the product of the required collateral account balance minus the collateral account unit balance, multiplied by one hundred and twenty-five percent (125%) of the value of a unit (the “required collateral account cash balance”). If at any time the collateral account cash balance is less than the required collateral account cash balance, Brookfield will within two (2) business days cause to be deposited cash or cash equivalents in the collateral account in an amount sufficient to cause the collateral account cash balance to be at least equal to the required collateral account cash balance.
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Brookfield and its affiliates will not be entitled to withdraw any cash or cash equivalents from the collateral account, except (i) to the extent the collateral account cash balance is greater than one hundred and twenty percent (120%) of the required collateral account cash balance or (ii) upon the deposit in the collateral account of a corresponding number of units or unit convertibles.
Registration of Units.   Brookfield has agreed that if a shelf registration statement has not been effective for five (5) consecutive business days with respect to all of the units in the collateral account, including units issuable from time to time upon conversion of or redemption for unit convertibles, and the transfer of such units from the collateral account to a holder of subject exchangeable shares, Brookfield will cause to be deposited into the collateral account an amount of cash or cash equivalents equal to one hundred and fifty percent (150%) of the value of all units (including units issuable from time to time upon conversion of or redemption for unit convertibles) held in the collateral account at such time; provided, however, no such deposit is required to the extent all of the units in the collateral account, including units issuable from time to time upon conversion of or redemption for unit convertibles, and the transfer of such units from the collateral account to a holder of subject exchangeable shares, are registered under an effective shelf registration statement.
Termination or Amendment. This rights agreement will terminate automatically on the earliest of (i) the date on which there are no exchangeable shares outstanding, other than exchangeable shares owned by Brookfield or its affiliates and (ii) the fifth anniversary of date of the Special Distribution. Brookfield may not, without the affirmative vote of holders of at least two-thirds of the outstanding exchangeable shares not held by Brookfield, voting as a class, and the approval of a majority of the independent directors of BBUC, materially amend, modify, or alter the rights agreement or repeal, terminate or waive any rights under the rights agreement. After the expiry of the rights agreement, holders of exchangeable shares will continue to have all of the rights provided for in the BBUC articles but will no longer be entitled to rely on the Secondary Exchange Rights.
Redemption
BBUC’s board of directors will have the right upon sixty (60) days’ prior written notice to holders of exchangeable shares to redeem all of the then outstanding exchangeable shares at any time and for any reason, in its sole discretion and subject to applicable law, including without limitation following the occurrence of any of the following redemption events: (i) the total number of exchangeable shares outstanding decreases by 50% or more over any twelve-month period; (ii) a person acquires 90% of the units in a take-over bid (as defined by applicable securities law); (iii) unitholders of the partnership approve an acquisition of the partnership by way of arrangement or amalgamation; (iv) unitholders of the partnership approve a restructuring or other reorganization of the partnership; (v) there is a sale of all or substantially all of the partnership assets; (vi) there is a change of law (whether by legislative, governmental or judicial action), administrative practice or interpretation, or a change in circumstances of BBUC and its shareholders, that may result in adverse tax consequences for BBUC or its shareholders; or (vii) BBUC’s board of directors, in its sole discretion, concludes that the unitholders of the partnership or holders of exchangeable shares are adversely impacted by a fact, change or other circumstance relating to BBUC. For greater certainty, unitholders do not have the ability to vote on such redemption and the BBUC board’s decision to redeem all of the then outstanding exchangeable shares will be final. In addition, the holder of BBUC class B shares may deliver a notice to BBUC specifying a redemption date upon which BBUC shall redeem all of the then outstanding exchangeable shares, and upon sixty (60) days’ prior written notice from BBUC to holders of the exchangeable shares and without the consent of holders of exchangeable shares, BBUC shall be required to redeem all of the then outstanding exchangeable shares on such redemption date, subject to applicable law.
Upon any such redemption event, the holders of exchangeable shares shall be entitled to receive pursuant to such redemption one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership as described above in “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”) or its cash equivalent based on the NYSE closing price of one unit on the trading day immediately preceding the announcement of such redemption plus all unpaid dividends, if any (the form of payment to be determined at the election of BBUC).
Notwithstanding the foregoing, upon any redemption event, we may elect to acquire all of the outstanding exchangeable shares in exchange for one unit per exchangeable share held (subject to adjustment in the event
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of certain dilutive or other capital events by BBUC or the partnership as described above in “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”) or its cash equivalent based on the NYSE closing price of one unit on the trading day immediately preceding the announcement of such redemption plus all unpaid dividends, if any (the form of payment to be determined at our election). Our unitholders are not entitled to vote on our exercise of the overriding call right described in the preceding sentences.
Liquidation
Upon any liquidation, dissolution or winding up of BBUC, and subject to the prior rights of holders of all classes and series of preferred shares and any other class of shares of BBUC ranking in priority or ratably with the exchangeable shares and after the payment in full to (i) any holder of exchangeable shares that has submitted a notice of the exercise of the exchange rights described above or any holder of BBUC class C shares that has submitted a notice of BBUC class C retraction, in each case at least ten (10) days prior to the date of the liquidation, dissolution or winding up, and (ii) any holder of BBUC class B shares that has submitted a notice of retraction at least thirty (30) days prior to the date of the liquidation, dissolution or winding up, the holders of exchangeable shares shall be entitled to an amount in cash per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership as described above in “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”) equal to the NYSE closing price of one unit on the trading day immediately preceding announcement of such liquidation, dissolution or winding up, plus all unpaid dividends, if any. If, upon any such liquidation, dissolution or winding up, the assets of BBUC are insufficient to make such payment in full, then the assets of BBUC will be distributed among the holders of exchangeable shares ratably in proportion to the full amounts to which they would otherwise be respectively entitled to receive.
Notwithstanding the foregoing, upon any liquidation, dissolution or winding up of BBUC, (i) BBUC may elect to redeem all of the outstanding exchangeable shares for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BEPC or the partnership as described above “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”), plus all unpaid dividends, if any, and (ii) we may elect to acquire all of the outstanding exchangeable shares for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership as described above in “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”) plus all unpaid dividends, if any. Unitholders are not entitled to vote on any such redemption of the exchangeable shares by BBUC or on the partnership’s exercise of the overriding call right described in the preceding sentences.
Automatic Redemption upon Liquidation of the Partnership
Upon any liquidation, dissolution or winding up of the partnership, including where substantially concurrent with a liquidation, dissolution or winding up of BBUC, all of the then outstanding exchangeable shares will be automatically redeemed by BBUC, in BBUC’s sole and absolute discretion, on the day prior to the liquidation, dissolution or winding up of the partnership. In such case, each holder of exchangeable shares shall be entitled to one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership as described above in “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”) or its cash equivalent based on the NYSE closing price of one unit on the trading day immediately preceding the announcement of such redemption plus all unpaid dividends, if any (the form of payment to be determined at the election of BBUC).
Notwithstanding the foregoing, upon any such redemption, we may elect to acquire all of the outstanding exchangeable shares in exchange for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership as described above in “— Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”) plus all unpaid dividends, if any. The acquisition by the partnership of all the outstanding exchangeable shares will occur on the day prior to the effective date of the liquidation, dissolution or winding up of the partnership. Unitholders are not entitled to vote on the partnership’s exercise of the overriding call right described in the preceding sentences.
Registration Rights Agreement
The partnership, BBUC and Brookfield have entered into a registration rights agreement, comparable to the registration rights agreement existing between Brookfield and the partnership. Under the such registration
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rights agreement, BBUC and the partnership have agreed that, upon the request of Brookfield, BBUC and the partnership will, as necessary take such actions to register for sale and qualify for distribution under applicable securities laws any of the exchangeable shares held by Brookfield and the underlying units that may be issued or delivered to satisfy any exchange, redemption or acquisition of exchangeable shares (including, if applicable, in connection with liquidation, dissolution or winding up of BBUC). In the registration rights agreement, BBUC has agreed to pay expenses in connection with such registration and sales and will indemnify Brookfield for material misstatements or omissions in the registration statement.
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DESCRIPTION OF THE PARTNERSHIP’S CAPITAL STRUCTURE
The following is a description of the material terms of the units and a summary of certain terms of the limited partnership agreement of the partnership, as amended (the “limited partnership agreement”), which is incorporated herein by reference. For more information on the limited partnership agreement, see Item 10.B, “Additional Information — Memorandum and Articles of Association — Description of Our Units and Our Limited Partnership Agreement” in our Annual Report on Form 20-F, which is incorporated by reference herein.
Our authorized partnership interests consist of an unlimited number of units and any additional partnership interests representing limited partnership interests of the partnership that may be issued. As of April 25, 2022, there were approximately 75.7 million units outstanding (or approximately (i) 145.4 million units assuming the exchange of all redemption/exchange units and (ii) 214.4 million units on a fully-exchanged basis). The redemption/exchange units are subject to a redemption-exchange mechanism pursuant to which units may be issued in exchange for redemption/exchange units on a one for one basis. Brookfield owns, directly and indirectly, approximately 65% of the partnership assuming the exchange of all of the redemption/exchange units held by Brookfield.
The units are non-voting limited partnership interests in the partnership. Holders of units are not entitled to the withdrawal or return of capital contributions in respect of the units, except to the extent, if any, that distributions are made to such holders pursuant to the limited partnership agreement or upon the liquidation of the partnership as described in our Annual Report on Form 20-F or as otherwise required by applicable law. Except to the extent expressly provided in the limited partnership agreement, a holder of units will not have priority over any other holder of units, either as to the return of capital contributions or as to profits, losses or distributions. Holders of units will not be granted any preemptive or other similar right to acquire additional interests in the partnership. In addition, holders of units do not have any right to have their units redeemed by the partnership.
Further, the partnership’s limited partners, in their capacities as such, may not take part in the management or control of the activities and affairs of the partnership and do not have any right or authority to act for or to bind the partnership or to take part or interfere in the conduct or management of the partnership. Limited partners are not entitled to vote on matters relating to the partnership, although holders of the units are entitled to consent to certain matters as described in the limited partnership agreement of the partnership which may be effected only with the consent of the holders of the percentages of outstanding units specified in the limited partnership agreement. Each unit shall entitle the holder thereof to one vote for the purposes of any approvals of holders of units.
Further, subject to the terms of any preferred units of the partnership then outstanding, the limited partnership agreement authorizes us to establish one or more classes, or one or more series of any such classes of preferred units of the partnership with such designations, preferences, rights, powers and duties as shall be determined by the general partner in its sole discretion, including: (i) the right to share in our profits and losses or items thereof; (ii) the right to share in our distributions; (iii) the rights upon our dissolution and liquidation; (iv) whether, and the terms and conditions upon which, we may or shall be required to redeem preferred units (including sinking fund provisions); (v) whether such preferred unit is issued with the privilege of conversion or exchange and, if so, the terms and conditions of such conversion or exchange; (vi) the terms and conditions upon which each preferred unit will be issued, evidenced by certificates and assigned or transferred; and (viii) the requirement, if any, of each such preferred unit to consent to certain partnership matters.
For a more detailed description of the units, please refer to our Annual Report on Form 20-F, as updated by our subsequent filings with the SEC that are incorporated herein by reference.
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COMPARISON OF RIGHTS OF HOLDERS OF EXCHANGEABLE SHARES AND UNITS
BBUC is a corporation existing under British Columbia law. The partnership is an exempted limited partnership existing under Bermuda law. The rights of holders of exchangeable shares will be governed by the Business Corporations Act (British Columbia) (“BCBCA”) and the BBUC articles. The rights of holders of the units are governed by the partnership’s limited partnership agreement and certain provisions of Bermuda law.
The following comparison is a summary of certain material differences between the rights of holders of exchangeable shares and holders of units under the governing documents of BBUC and the partnership and the applicable laws noted above. The following summary is qualified in its entirety by reference to the relevant provisions of (i) the BCBCA; (ii) the Bermuda Limited Partnership Act 1883, the Bermuda Exempted Partnerships Act 1992 and the Bermuda Partnership Act 1902; (iii) the BBUC articles; (iv) the partnership’s limited partnership agreement, as amended from time to time; and (v) the bye-laws of the general partner.
This section does not include a complete description of all of the differences between the rights of holders of exchangeable shares and holders of units, nor does it include a complete description of the specific rights of such holders. Furthermore, the identification of some of the differences in the rights of such holders is not intended to indicate that other differences that may be equally important do not exist. You are urged to read carefully the relevant provisions of British Columbia law and Bermuda law, as well as the governing documents of each of BBUC and the partnership, each as amended, restated, supplemented or otherwise modified from time to time, copies of which are available, without charge, to any person, including any beneficial owner of units to whom this prospectus is delivered, by following the instructions listed under “Where You Can Find More Information”.
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EXCHANGEABLE SHARES
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UNITS
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Corporate Governance
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BBUC is a corporation formed under the laws of the Province of British Columbia. The rights of holders of exchangeable shares, upon completion of the Special Distribution, will be governed by the BCBCA and the BBUC articles.
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The partnership is a Bermuda-exempted limited partnership registered under the Bermuda Limited Partnership Act 1883 and the Bermuda Exempted Partnerships Act 1992. The partnership’s limited partnership agreement provides for the management and control of the partnership by a general partner, the partnership’s general partner.
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Authorized Capital
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BBUC is authorized to issue an unlimited number of: (i) exchangeable shares; (ii) BBUC class B shares; (iii) BBUC class C shares; (iv) BBUC class A senior preferred shares, issuable in series, and (v) BBUC class B junior preferred shares, issuable in series. All exchangeable shares, BBUC class B shares, BBUC class C shares, BBUC class A senior preferred shares and BBUC class B junior preferred shares will be issued without par value. The number of authorized exchangeable shares can be changed in accordance with the BBUC articles or, if the BBUC articles are silent, by special resolution, in accordance with s. 54(3)(c) of the BCBCA.
Subject to the BBUC articles, including the terms of the shares then outstanding, BBUC’s board of directors has broad
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The partnership is a Bermuda-exempted limited partnership registered under the Bermuda Limited Partnership Act 1883 and the Bermuda Exempted Partnerships Act 1992. The partnership’s limited partnership agreement provides for the management and control of the partnership by a general partner, the partnership’s general partner.
The partnership’s interests consist of the general partner unit, which represents the general partnership interest, and the units, representing limited partnership interests in the partnership, and any additional partnership interests representing limited partnership interests that it may issue in the future.
The partnership’s general partner has broad rights to cause the partnership to issue additional partnership interests and may cause the partnership to issue
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EXCHANGEABLE SHARES
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UNITS
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rights to issue additional shares (including new classes of shares and options, rights, warrants, and appreciation rights relating to such shares) for any purpose, at any time and on such terms and conditions as it may determine without the approval of any shareholders. Any additional shares may be issued in one or more classes, or one or more series of classes, with such designations, preferences, rights, powers and duties (which may be senior to existing classes and series of shares) as may be determined by BBUC’s board of directors in its sole discretion.
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additional partnership interests (including new classes of partnership interests and options, rights, warrants and appreciation rights relating to such interests) for any partnership purpose, at any time and on such terms and conditions as it may determine without the approval of any limited partners. Any additional partnership interests may be issued in one or more classes, or one or more series of classes, with such designations, preferences, rights, powers and duties (which may be senior to existing classes and series of partnership interests) as may be determined by the partnership’s general partner in its sole discretion, all without the approval of the partnership’s limited partners.
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Voting Rights
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Except as otherwise expressly provided in the BBUC articles or as required by law, the holders of exchangeable shares and BBUC class B shares, will vote together and not as separate classes. Each holder of an exchangeable share will be entitled to cast one vote per exchangeable share on all matters submitted to a vote. On each such matter, the holders of BBUC class B shares will be entitled to cast, in the aggregate, a number of votes equal to three times the number of votes attached to the exchangeable shares. As Brookfield Business Partners will hold all of the class B shares, it will hold 75% of the votes eligible to be cast on all matters where the exchangeable shares and class B shares vote together.
At any time that no exchangeable shares are outstanding and for any vote held only in respect of the BBUC class B shares, the holder of the BBUC class B shares will be entitled to cast one vote per BBUC class B share. At any time that no exchangeable shares are outstanding, quorum will be at least one holder of BBUC class B shares.
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Limited partners are not entitled to vote on matters relating to the partnership, although holders of units are entitled to consent to certain matters with respect to certain amendments to the partnership’s limited partnership agreement and certain matters with respect to the withdrawal of the partnership’s general partner. Each unit entitles the holder thereof to one vote for the purposes of any approvals of holders of units. In addition to their rights under the partnership’s limited partnership agreement, limited partners have consent rights with respect to certain fundamental matters and on any other matters that require their approval in accordance with applicable securities laws and stock exchange rules.
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Size of Board
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BBUC’s board is currently set at nine (9) directors. BBUC’s board of directors may consist of between three (3) and eleven (11) directors or such other number of directors as may be determined from time to time by a resolution of BBUC’s shareholders and subject to the BBUC articles. BBUC’s board of directors is expected to mirror
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The partnership’s general partner board of directors is currently set at seven (7) directors. The board may consist of between three (3) and eleven (11) directors or such other number of directors as may be determined from time to time by a resolution of the shareholders of the partnership’s general partner and subject
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EXCHANGEABLE SHARES
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UNITS
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the board of directors of the general partner of the partnership, except for one additional non-overlapping director to assist us with, among other things, resolving any conflicts of interest that may arise from BBUC’s relationship with Brookfield Business Partners.
At least three (3) directors and at least a majority of the directors holding office must be independent of BBUC, as determined by the full board using the standards for independence established by the NYSE.
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to its bye-laws. At least three (3) directors and at least a majority of the directors holding office must be independent of the partnership’s general partner and Brookfield, as determined by the full board of directors using the standards of independence established by NYSE.
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Election and Removal of Directors
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BBUC’s board is elected by its shareholders and each of its current directors will serve until immediately before the election or appointment of directors at the next annual meeting of shareholders of BBUC or his or her death, resignation or removal from office, whichever occurs first. Vacancies on BBUC’s board of directors may be filled and additional directors may be added by a resolution of BBUC’s shareholders or a vote of the directors then in office. A director may be removed from office by a special resolution duly passed by BBUC’s shareholders or a resolution of the directors if the director is convicted of an indictable offence, or if the director ceases to be qualified to act as a director of BBUC and does not promptly resign. A director will be automatically removed from BBUC’s board of directors if he or she becomes bankrupt, insolvent or suspends payments to his or her creditors or becomes disqualified by law from acting as a director pursuant to the BCBCA.
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The partnership’s general partner’s board of directors was elected by its shareholder and each of its current directors will serve until the close of the next annual meeting of shareholders of the partnership’s general partner or his or her death, resignation or removal from office, whichever occurs first. Vacancies on the partnership’s general partner’s board of directors may be filled and additional directors may be added by a resolution of the shareholders of the partnership’s general partner or a vote of the directors then in office. A director may be removed from office by a resolution duly passed by the shareholders of the partnership’s general partner or, if the director has been absent without leave from three consecutive meetings of the board of directors, by a written resolution requesting resignation signed by all other directors then holding office. A director will be automatically removed from the board of directors if he or she becomes bankrupt, insolvent or suspends payments to his or her creditors or becomes prohibited by law from acting as a director.
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Process to Amend the Governing Instruments
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BBUC may from time to time amend, modify or repeal any provision contained in the BBUC articles in a manner authorized by the BCBCA.
Under the BCBCA, alteration of the articles generally requires authorization by either court order, by a two-thirds (2/3rds) vote of all voting shares or by the methods specified in the BBUC articles. Certain alterations to matters such as changes to company name or address or a change in directors will not require
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Amendments to the partnership’s limited partnership agreement may be proposed only by or with the consent of the partnership’s general partner. To adopt a proposed amendment, other than the amendments that do not require limited partner approval discussed below, the partnership’s general partner must seek approval of a majority of outstanding units required to approve the amendment, either by way of a meeting of the limited partners to consider and vote upon the
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EXCHANGEABLE SHARES
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UNITS
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authorization by the above-mentioned methods. Specific alterations such as those of a nature affecting a particular class or series in a manner that would prejudice or interfere with the rights of such class or series, will entitle the affected class or series to consent by special resolution to the alteration, whether or not such class or series otherwise carries the right to vote.
Under the BCBCA, BBUC may resolve to alter its articles by the type of resolution specified in the BCBCA, if not specified in the BCBCA, by the type of resolution specified in the BBUC articles or if neither the BCBCA or the BBUC articles specify the type of resolution, by a two-thirds (2/3rds) vote of all voting shares; provided however, if such alteration would prejudice or interfere with the rights of a particular class or series, such class or series must consent by special resolution to the alteration, whether or not such class or series otherwise carries the right to vote.
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proposed amendment or by written approval.
No amendment may be made that would: (i) enlarge the obligations of any limited partner without its consent, except any amendment that would have a material adverse effect on the rights or preferences of any class of partnership interests in relation to other classes of partnership interests may be approved by at least a majority of the type or class of partnership interests so affected; or (ii) enlarge the obligations of, restrict in any way any action by or rights of, or reduce in any way the amounts distributable, reimbursable or otherwise payable by the partnership to, the partnership’s general partner or any of its affiliates without the consent of the partnership’s general partner, which may be given or withheld in its sole discretion. The provision of the partnership’s limited partnership agreement preventing the amendments having the effects described in clauses (i) and (ii) above can be amended upon the approval of the holders of at least 90% of the outstanding units.
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Subject to applicable law, the partnership’s general partner may generally make amendments to the partnership’s limited partnership agreement without the approval of any limited partner to reflect: (i) a change in the name of the partnership, the location of its registered office or its registered agent; (ii) the admission, substitution or withdrawal of partners in accordance with the partnership’s limited partnership agreement; (iii) a change that the partnership’s general partner determines is reasonable and necessary or appropriate for the partnership to qualify or to continue its qualification as an exempted limited partnership under the laws of Bermuda or a partnership in which the limited partners have limited liability under the laws of any jurisdiction or is necessary or advisable in the opinion of the partnership’s general partner to ensure that the partnership will not be treated as an association taxable as a corporation or otherwise taxed as an entity for tax purposes; (iv) an amendment that the
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EXCHANGEABLE SHARES
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UNITS
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partnership’s general partner determines to be necessary or appropriate to address certain changes in tax regulations, legislation or interpretation; (v) an amendment that is necessary, in the opinion of the partnership’s counsel, to prevent the partnership or the partnership’s general partner or its directors or officers, from in any manner being subjected to the provisions of the Investment Company Act of 1940, as amended, or similar legislation in other jurisdictions; (vi) an amendment that the partnership’s general partner determines in its sole discretion to be necessary or appropriate for the creation, authorization or issuance of any class or series of partnership interests or options, rights, warrants or appreciation rights relating to partnership securities; (vii) any amendment expressly permitted in the partnership’s limited partnership agreement to be made by the partnership’s general partner acting alone; (viii) an amendment effected, necessitated or contemplated by a merger or consolidation of the partnership with one or more persons in accordance with the provisions of the partnership’s limited partnership agreement; (ix) any amendment that the partnership’s general partner determines in its sole discretion to be necessary or appropriate to reflect and account for the formation by the partnership of, or its investment in, any corporation, partnership, joint venture, limited liability company or other entity, as otherwise permitted by the partnership’s limited partnership agreement; (x) a change in the partnership’s fiscal year and related changes; or (xi) any other amendments substantially similar to any of the matters described in (i) through (x) above.
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In addition, the partnership’s general partner may make amendments to the partnership’s limited partnership agreement without the approval of any limited partner if those amendments, in the discretion of the partnership’s general partner: (i) do not adversely affect the partnership’s limited partners considered as a whole (including any particular class of partnership interests as compared to
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EXCHANGEABLE SHARES
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UNITS
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other classes of partnership interests) in any material respect; (ii) are necessary or appropriate to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any governmental agency or judicial authority; (iii) are necessary or appropriate to facilitate the trading of the units or to comply with any rule, regulation, guideline or requirement of any securities exchange on which the units are or will be listed for trading; (iv) are necessary or appropriate for any action taken by the partnership’s general partner relating to splits or combinations of units under the provisions of the partnership’s limited partnership agreement; or (v) are required to effect the intent expressed in the Registration Statement (as defined in the partnership’s limited partnership agreement) or the intent of the provisions of the partnership’s limited partnership agreement or are otherwise contemplated by the partnership’s limited partnership agreement.
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The partnership’s general partner will not be required to obtain an opinion of counsel that an amendment will not result in a loss of limited liability to the limited partners if one of the amendments described in the preceding two paragraphs should occur. No other amendments to the partnership’s limited partnership agreement will become effective without the approval of holders of at least 90% of the units, unless the partnership obtains an opinion of counsel to the effect that the amendment will not (i) cause the partnership to be treated as an association taxable as a corporation or otherwise taxable as an entity for tax purposes (provided that for U.S. tax purposes the partnership’s general partner has not made the election described below under the section entitled “Qualification”), or (ii) affect the limited liability under the Bermuda Limited Partnership Act 1883 of any of the partnership’s limited partners.
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In addition to the above restrictions, any amendment that would have a material adverse effect on the rights or preferences of any type or class of partnership
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EXCHANGEABLE SHARES
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UNITS
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interests in relation to other classes of partnership interests will also require the approval of the holders of at least a majority of the outstanding partnership interests of the class so affected.
In addition, any amendment that reduces the voting percentage required to take any action must be approved by the written consent or affirmative vote of limited partners whose aggregate outstanding voting units constitute not less than the voting requirement sought to be reduced.
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Special Meetings of the Shareholders
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A special meeting of the shareholders for any purpose or purposes may be called only by BBUC’s board on a date not less than twenty-one (21) days nor more than two (2) months after the sending of the notice of the meeting to each shareholder of record entitled to vote at such meeting.
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The partnership’s general partner may call special meetings of the limited partners at a time and place outside of Canada determined by the partnership’s general partner on a date not less than ten (10) days nor more than sixty (60) days after the mailing of notice of the meeting. The limited partners do not have the ability to call a special meeting. Only holders of record on the date set by the partnership’s general partner (which may not be less than ten (10) nor more than sixty (60) days before the meeting) are entitled to notice of any meeting.
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Written Consent in Lieu of Meeting
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Under the BCBCA, generally, shareholder action without a meeting may only be taken by consent resolution of the shareholders entitled to vote on the resolution: with a written consent executed by shareholders holding two-thirds  of the shares that carry the right to vote at general meetings being effective to approve an action requiring an ordinary resolution; or with a written consent executed by all shareholders that carry the right to vote at general meetings or by all of the shareholders holding shares of the applicable class or series of shares, as the case may be, being effective to approve an action requiring a special resolution or an exceptional resolution.
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Written consents may be solicited only by or on behalf of the partnership’s general partner. Any such consent solicitation may specify that any written consents must be returned to the partnership within the time period, which may not be less than twenty (20) days, specified by the partnership’s general partner.
For purposes of determining holders of partnership interests entitled to provide consents to any action described above, the partnership’s general partner may set a record date, which may be not less than ten (10) nor more than sixty (60) days before the date by which record holders are requested in writing by the partnership’s general partner to provide such consents. Only those holders of partnership interests on the record date established by the partnership’s general partner will be entitled to provide consents with respect to matters as to which a consent right applies.
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EXCHANGEABLE SHARES
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UNITS
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Limitation of Liability and Indemnification of Directors and Officers
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No director will be personally liable to BBUC or its shareholders for monetary damages for breach of fiduciary duty, except to the extent such exemption is not permitted under the BCBCA. Under the BCBCA, no provision in the BBUC articles or other contract relieves a director or officer from (i) the duty to act in accordance with the BCBCA and the regulations, or (ii) liability that by virtue of any enactment or rule of law or equity would otherwise attach to that director or officer in respect of any negligence, default, breach of duty or breach of trust of which the director or officer may be guilty in relation to BBUC.
To the fullest extent permitted by law, BBUC will indemnify any present or former director or officer of BBUC (or a person serving as a director, officer, trustee, employee or agent of another corporation), who was or is a party or is threatened to be made a party to, or is otherwise involved in, any threatened, pending or completed action while acting in such capacity, for all liability and loss suffered (including, without limitation, any judgments, fines, or penalties and amounts paid in settlement) and expenses (including attorneys’ fees and disbursements), actually and reasonably incurred.
Subject to any restrictions in the BCBCA, BBUC may agree to indemnify and may indemnify any person (including an eligible party) against eligible penalties and pay expenses incurred in connection with the performance of services by that person for BBUC.
BBUC may enter into agreements with any such person to provide such indemnification. The right to indemnification includes the right to be paid by BBUC the expenses (including attorneys’ fees) incurred by such person in defending any such proceeding in advance of its final disposition, such that the advances are paid by BBUC within sixty (60) days after the receipt by BBUC of a statement or statements from the claimant requesting such advance or advances from time to time (and subject
​ ​
Under the partnership’s limited partnership agreement, the partnership is required to indemnify to the fullest extent permitted by law the partnership’s general partner and any of its affiliates (and their respective officers, directors, agents, shareholders, partners, members and employees), any person who serves on a governing body of a holding entity or operating entity of the partnership and any other person designated by the partnership’s general partner as an indemnified person, in each case, against all losses, claims, damages, liabilities, costs or expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, incurred by an indemnified person in connection with the partnership’s investments and activities or by reason of their holding such positions, except to the extent that the claims, liabilities, losses, damages, costs or expenses are determined to have resulted from the indemnified person’s bad faith, fraud or willful misconduct, or in the case of a criminal matter, action that the indemnified person knew to have been unlawful. In addition, under the partnership’s limited partnership agreement: (i) the liability of such persons has been limited to the fullest extent permitted by law, except to the extent that their conduct involves bad faith, fraud or willful misconduct, or in the case of a criminal matter, action that the indemnified person knew to have been unlawful; and (ii) any matter that is approved by the independent directors of the partnership’s general partner will not constitute a breach of the partnership’s limited partnership agreement or any duties stated or implied by law or equity, including fiduciary duties. The partnership’s limited partnership agreement requires the partnership to advance funds to pay the expenses of an indemnified person in connection with a matter in which indemnification may be sought until it is determined that the indemnified person is not entitled to indemnification.
​
24
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​
to filing a written request for indemnification pursuant to the BBUC articles).
BBUC will not indemnify any present or former director or officer of BBUC for acts of bad faith, fraud, willful misfeasance, gross negligence, knowing violation of law or reckless disregard of the director’s duties or for any act for which indemnification is specifically prohibited under the BCBCA.
​ ​
The partnership’s general partner’s bye-laws provide that, as permitted by the laws of Bermuda, it will pay or reimburse an indemnified person’s expenses in advance of a final disposition of a proceeding for which indemnification is sought.
Under the partnership’s general partner’s bye-laws, the partnership’s general partner is required to indemnify, to the fullest extent permitted by law, its affiliates, directors, officers, resident representatives, shareholders, employees or any of its subsidiaries and certain others against any and all losses, claims, damages, liabilities, costs or expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts arising from any and all claims, demands, actions, suits or proceedings, incurred by an indemnified person in connection with the partnership’s investments and activities or in respect of or arising from their holding such positions, except to the extent that the claims, liabilities, losses, damages, costs or expenses are determined to have resulted from the indemnified person’s bad faith, fraud or willful misconduct, or in the case of a criminal matter, action that the indemnified person knew to have been unlawful. In addition, under the partnership’s general partner’s bye-laws: (i) the liability of such persons has been limited to the fullest extent permitted by law and except to the extent that their conduct involves bad faith, fraud or willful misconduct, or in the case of a criminal matter, action that the indemnified person knew to have been unlawful; and (ii) any matter that is approved by the independent directors will not constitute a breach of any duties stated or implied by law or equity, including fiduciary duties. The partnership’s general partner’s bye-laws require it to advance funds to pay the expenses of an indemnified person in connection with a matter in which indemnification may be sought until it is determined that the indemnified person is not entitled to indemnification.
​
25
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
Dividends and Distributions
​ ​
Pursuant to the BBUC articles and subject to the prior rights of holders of all classes and series of preferred shares at the time outstanding having prior rights as to dividends, each exchangeable share will entitle its holder to the exchangeable dividend, in a cash amount equal in value to (i) the amount of any distribution made on a unit multiplied by (ii) the conversion factor determined in accordance with the BBUC articles and in effect on the record date of such dividend (which conversion factor will initially be one, subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership). See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”. The record and payment dates for the dividends upon the exchangeable shares, to the extent not prohibited by applicable law, shall be substantially the same as the record and payment dates for distributions on the units.
​ ​
Distributions to partners of the partnership will be made in accordance with their Percentage Interests (as defined in the limited partnership agreement of the partnership) only as determined by the general partner in its sole discretion. However, the general partner will not be permitted to cause the partnership to make a distribution if the partnership does not have sufficient cash on hand to make the distribution, the distribution would render the partnership insolvent, or if, in the opinion of the general partner, the distribution would leave the partnership with insufficient funds to meet any future or contingent obligations, or the distribution would contravene applicable laws.
The general partner has sole authority to determine whether the partnership will make distributions and the amount and timing of these distributions.
​
​ ​ ​
If the full amount of an exchangeable dividend is not declared and paid concurrent with a distribution on the units, then the undeclared or unpaid amount of such exchangeable dividend shall accrue and accumulate (without interest), whether or not BBUC has earnings, whether or not there are funds legally available for the payment thereof and whether or not such exchangeable dividend has been declared or authorized. Any exchangeable dividend payment made shall first be credited against the earliest accumulated but unpaid exchangeable dividends due which remain payable (“unpaid dividend”).
All exchangeable dividends shall be paid prior and in preference to any dividends or distributions on the BBUC class C shares. Share dividends, if any, paid on the exchangeable shares and BBUC class C shares will be declared contemporaneously and paid at the same time in equal numbers of additional shares of the same class and series such that share dividends will be paid in exchangeable shares to holders of the
​ ​ ​ ​
26
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​
exchangeable shares and in BBUC class C shares to holders of the BBUC class C shares.
The holders of exchangeable shares shall not be entitled to any dividends from BBUC other than the exchangeable dividends.
​ ​ ​ ​
Exchange by Holder
​ ​
At any time after the distribution date, holders of exchangeable shares shall have the right to exchange all or a portion of their exchangeable shares for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership) or its cash equivalent based on the NYSE closing price of one unit on the date of the request for exchange (or if not a trading day, the next trading day thereafter) plus all unpaid dividends, if any (the form of payment to be determined at the election of BBUC). See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”.
The partnership may elect to satisfy BBUC’s exchange obligation by acquiring all of the tendered exchangeable shares for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership) or its cash equivalent based on the NYSE closing price of one unit on the date that the request for exchange is received by BBUC’s transfer agent (or if not a trading day, the next trading day thereafter) plus all unpaid dividends, if any (the form of payment to be determined at the election of the partnership). See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”.
​ ​ N/A ​
Redemption by Issuer
​ ​
BBUC’s board of directors will have the right upon sixty (60) days’ prior written notice to holders of exchangeable shares to redeem all of the then outstanding exchangeable shares at any time and for any reason, in its sole discretion subject to applicable law, including without limitation following the occurrence of certain redemption events described in
​ ​ N/A ​
27
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​
“Exchange of Exchangeable Shares for Units — Redemption”. In addition, the holder of BBUC class B shares may deliver a notice to BBUC specifying a redemption date upon which BBUC shall redeem all of the then outstanding exchangeable shares, and upon sixty (60) days’ prior written notice from BBUC to holders of the exchangeable shares and without the consent of holders of exchangeable shares, BBUC shall be required to redeem all of the then outstanding exchangeable shares on such redemption date, subject to applicable law.
​ ​ ​ ​
​ ​ ​
Upon any such redemption event, the holders of exchangeable shares shall be entitled to one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership) or its cash equivalent based on the NYSE closing price of one unit on the trading day immediately preceding the announcement of such redemption plus all unpaid dividends, if any (the form of payment to be determined at the election of BBUC). See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”.
​ ​ ​ ​
​ ​ ​
Upon any liquidation, dissolution or winding up of the partnership, including where substantially concurrent with a liquidation, dissolution or winding up of BBUC, all of the then outstanding exchangeable shares of BBUC will be automatically redeemed by BBUC on the day prior to the liquidation, dissolution or winding up of the partnership. Each holder of exchangeable shares shall be entitled to one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership) or its cash equivalent based on the NYSE closing price of one unit on the trading day immediately preceding the announcement of such liquidation, dissolution or winding up of the partnership (the form of payment to be determined at the election of BBUC) plus all unpaid dividends. See “Exchange of Exchangeable Shares for Units —
​ ​ ​ ​
28
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​
Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”.
​ ​ ​ ​
Qualification
​ ​ N/A ​ ​
If the partnership’s general partner determines in its sole discretion that it is no longer in the partnership’s best interests to continue as a partnership for U.S. federal income tax purposes, the partnership’s general partner may elect to treat partnership as an association or as a publicly traded partnership taxable as a corporation for U.S. federal (and applicable state) income tax purposes.
​
Liquidation
​ ​
Upon any liquidation, dissolution or winding up of BBUC, and subject to the prior rights of holders of preferred shares and any other class of shares of BBUC ranking in priority or ratably with the exchangeable shares and after the payment in full to (i) any holder of exchangeable shares or BBUC class C shares that has submitted a notice of the exercise of the exchange rights described above at least ten (10) days prior to the date of the liquidation, dissolution or winding up (or in the case of the BBUC class B shares, thirty (30) days prior to the date of the liquidation, dissolution or winding up) and (ii) any unpaid dividends, the holders of exchangeable shares shall be entitled to one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership described in this prospectus) or its cash equivalent based on the NYSE closing price of one unit on the trading day immediately preceding announcement of such liquidation, dissolution or winding up (the form of payment to be determined at the election of BBUC). If, upon any such liquidation, dissolution or winding up, the assets of BBUC are insufficient to make such payment in full, then the assets of BBUC will be distributed among the holders of exchangeable shares ratably in proportion to the full amounts to which they would otherwise be respectively entitled to receive.
Notwithstanding the foregoing, upon any liquidation, dissolution or winding up of BBUC, the partnership may elect to acquire all of the outstanding
​ ​
The partnership will terminate upon the earlier to occur of: (i) the date on which all of the partnership’s assets have been disposed of or otherwise realized by the partnership and the proceeds of such disposals or realizations have been distributed to partners; (ii) the service of notice by the partnership’s general partner, with the special approval of a majority of its independent directors, that in its opinion the coming into force of any law, regulation or binding authority renders illegal or impracticable the continuation of the partnership; and (iii) at the election of the partnership’s general partner, if the partnership, as determined by the partnership’s general partner, is required to register as an “investment company” under the Investment Company Act of 1940, as amended, or similar legislation in other jurisdictions.
The partnership will be dissolved upon the withdrawal of the partnership’s general partner as the general partner of the partnership (unless a successor entity becomes the general partner pursuant to the partnership’s limited partnership agreement) or the date on which any court of competent jurisdiction enters a decree of judicial dissolution of the partnership or an order to wind-up or liquidate the partnership’s general partner without the appointment of a successor in compliance with the partnership’s limited partnership agreement. The partnership will be reconstituted and continue without dissolution if within thirty (30) days of the date of dissolution (and provided a notice of dissolution has not been filed with the Bermuda Monetary Authority),
​
29
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​
exchangeable shares for one unit per exchangeable share held (subject to adjustment in the event of certain dilutive or other capital events by BBUC or the partnership) plus all unpaid dividends, if any. See “Exchange of Exchangeable Shares for Units — Primary Exchange Rights — Adjustments to Reflect Certain Capital Events”. The acquisition by the partnership of all the outstanding exchangeable shares will occur on the day prior to the effective date of the liquidation, dissolution or winding up of BBUC.
​ ​
a successor general partner executes a transfer deed pursuant to which the new general partner assumes the rights and undertakes the obligations of the general partner, but only if the partnership receives an opinion of counsel that the admission of the new general partner will not result in the loss of limited liability of any limited partner.
Upon the partnership’s dissolution, unless the partnership is continued as a new limited partnership, the liquidator authorized to wind-up the partnership’s affairs will, acting with all of the powers of the partnership’s general partner that the liquidator deems necessary or appropriate in its judgment, liquidate the partnership’s assets and apply the proceeds of the liquidation first, to discharge the partnership’s liabilities as provided in its limited partnership agreement and by law, and thereafter to the partners pro rata according to the percentages of their respective partnership interests as of a record date selected by the liquidator. The liquidator may defer liquidation of the partnership’s assets for a reasonable period of time or distribute assets to partners in kind if it determines that an immediate sale or distribution of all or some of the partnership’s assets would be impractical or would cause undue loss to the partners.
​
Conversion
​ ​
At any time after the distribution date, the partnership, or any of its controlled subsidiaries, will be entitled to convert each held exchangeable share to a BBUC class C share on a one-for-one basis.
​ ​ N/A ​
Fiduciary Duties
​ ​
The directors of BBUC have three principal responsibilities under the BCBCA and the BBUC articles, being (i) the duty to manage, (ii) the fiduciary duty, which is to act honestly and in good faith with a view to the best interests of BBUC, and (iii) the duty of care, which is to exercise the care, diligence and skill that a reasonably prudent individual would exercise in comparable circumstances.
​ ​
A general partner is required to act in good faith and in a manner which it reasonably believes to be in the best interests of a partnership. The partnership’s limited partnership agreement contains various express provisions that modify, waive and/or limit the fiduciary duties that might otherwise be owed to the partnership and the limited partners. These modifications inter alia restrict the remedies available for actions that might otherwise constitute a breach of fiduciary duty and permit the general partner of the partnership to take into account the
​
30
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​ ​ ​ ​
interests of third parties, including Brookfield, when resolving conflicts of interest.
​
Protection of Shareholders
​ ​
Under the BCBCA, pursuant to the oppression remedy, any holder of exchangeable shares may apply to court for an order where the affairs of BBUC are being or have been conducted, or that the powers of the directors are being or have been exercised, in a manner that is oppressive to one or more shareholders, or where there has been some act of BBUC that is unfairly prejudicial to one or more of the shareholders. Under the BCBCA, pursuant to the derivative action remedy, a shareholder (including a beneficial shareholder) may bring an action in the name of and on behalf of BBUC to enforce a right, duty or obligation owed to BBUC that could be enforced by BBUC itself or to obtain damages for any such breach of right, duty or obligation.
​ ​
There is no oppression remedy or derivative action remedy available under the Bermuda Limited Partnership Act 1883 and the Bermuda Exempted Partnerships Act 1992.
Furthermore, the partnership’s limited partnership agreement also stipulates that unless otherwise determined by the general partner of the partnership, a Person (as defined in the partnership’s limited partnership agreement) shall not have pre-emptive, preferential or other similar rights in respect to the issuance of a unit.
​
Takeover Bids, Issuer Bids and Tender Offers
​ ​
The exchangeable shares are not units and will not be treated as units for purposes of the application of applicable Canadian or U.S. rules relating to takeover bids, issuer bids and tender offers. As a result, holders of exchangeable shares will not be entitled to participate in an offer or bid made to acquire units unless such offer has been extended to holders of exchangeable shares.
​ ​
The units are not exchangeable shares and will not be treated as exchangeable shares for purposes of the application of applicable Canadian or U.S. rules relating to takeover bids, issuer bids and tender offers. As a result, holders of units will not be entitled to participate in an offer or bid made to acquire the exchangeable shares unless such offer has been extended to holders of units.
​
Choice of Forum for Securities Act Claims
​ ​
BBUC’s articles provide that unless BBUC consents in writing to the selection of an alternative forum, the federal district courts of the United States shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. In the absence of this provision, under the Securities Act, U.S. federal and state courts have been found to have concurrent jurisdiction over suits brought to enforce duties or liabilities created by the Securities Act. This choice of forum provision will not apply to suits brought to enforce duties or liabilities created by the Exchange Act and could be found to be inapplicable or
​ ​
The limited partnership agreement of the partnership will be amended on the closing of the special distribution to provide that unless the partnership consents in writing to the selection of an alternative forum, the federal district courts of the United States shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. In the absence of this provision, under the Securities Act, U.S. federal and state courts have been found to have concurrent jurisdiction over suits brought to enforce duties or liabilities created by the Securities Act. This choice of forum provision will not apply to suits brought to enforce duties or liabilities
​
31
 
​ ​ ​
EXCHANGEABLE SHARES
​ ​
UNITS
​
​ ​ ​
unenforceable if it is challenged in a legal proceeding or otherwise.
​ ​
created by the Exchange Act and could be found to be inapplicable or unenforceable if it is challenged in a legal proceeding or otherwise.
​
32
 
SELLING SECURITYHOLDER
The table below sets forth information regarding beneficial ownership of units by the selling securityholder as of April 29, 2022. Pursuant to the rights agreement, Brookfield has agreed that, until the fifth anniversary of the date of the Special Distribution, in the event that, on the applicable specified exchange date with respect to any subject exchangeable shares, (i) BBUC has not satisfied its obligations under the BBUC articles by delivering the unit amount or its cash equivalent amount and (ii) we have not, upon our election in our sole and absolute discretion, acquired such subject exchangeable share from the holder thereof and delivered the unit amount or the cash equivalent amount, Brookfield will satisfy, or cause to be satisfied, the obligations pursuant to the BBUC articles to exchange such subject exchangeable shares for the unit amount or its cash equivalent. If Brookfield satisfies the exchange obligation, it will acquire exchangeable shares.
Pursuant to Rule 13d-4 under the Exchange Act, the statements concerning voting and dispositive power concerning the units included in the footnotes to this table shall not be construed as admissions that such persons are the beneficial owners of such units.
Selling
Securityholder 		​ ​
Units Beneficially
Owned(1)
​ ​
Percentage of Units
Outstanding(2)
​ ​
Maximum Number
of Units That May
Be Delivered upon
Exchange of
Exchangeable
Shares by
Brookfield Pursuant
to the Rights
Agreement
​ ​
Percentage After
Maximum Number of
Units are Delivered
upon Exchange of
Exchangeable Shares
by Brookfield
Pursuant to the
Rights Agreement
​
Brookfield Asset Management Inc.(3)
​ ​ ​ ​ 94,489,747 ​ ​ ​ ​ ​ 64.9% ​ ​ ​ ​ ​ 94,489,747 ​ ​ ​ ​ ​ —(4) ​ ​
​
(1)
Consists of 24,784,250 units and 69,705,497 redemption/exchange units. The table excludes any BBUC exchangeable shares owned by Brookfield.
​
(2)
The percentage of beneficial ownership is based on 75,734,895 units outstanding and an aggregate of 69,705,497 redemption/​exchange units held by Brookfield.
​
(3)
The address of Brookfield Asset Management Inc. is Brookfield Place, Suite 300, 181 Bay Street, P.O. Box 762, Toronto, Ontario M5J 2T3.
​
(4)
Assumes that all exchange requests of exchangeable shares are satisfied in reliance on the Secondary Exchange Rights and no units are delivered by the partnership or BBUC in satisfaction of exchange requests on the exchangeable shares. The partnership and BBUC currently intend to satisfy any exchange requests on the exchangeable shares through the delivery of units rather than cash.
​
For a description of our relationship with Brookfield as well as potential conflicts of interest (and the methods for resolving them) and other material considerations arising from our relationship with Brookfield, please see Item 7.B, “Related Party Transactions” in our Annual Report on Form 20-F, which is incorporated by reference in this prospectus.
PLAN OF DISTRIBUTION
This prospectus relates to the issuance by the partnership or delivery by BBUC or Brookfield of units from time to time in connection with the exchange, redemption or acquisition, as applicable, of exchangeable shares. No broker, dealer or underwriter has been engaged in connection with any such exchange. We will pay all expenses of effecting the exchanges pursuant to this prospectus.
For more information, see “Exchange of Exchangeable Shares for Units”.
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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a summary of material United States federal income tax considerations for holders relating to the exchange of exchangeable shares for units as described in this prospectus as of the date hereof. This summary is based on provisions of the Code, on the regulations promulgated thereunder (the “Treasury Regulations”), and on published administrative rulings, judicial decisions, and other applicable authorities, all as in effect on the date hereof and all of which are subject to change at any time, possibly with retroactive effect. This summary should be read in conjunction with the discussion of the principal U.S. federal income tax considerations associated with the operations of the partnership and the purchase, ownership, and disposition of units set forth in Item 10.E “Taxation — Certain Material U.S. Federal Income Tax Considerations” and Item 3.D “Risk Factors — Risks Related to Taxation” in our Annual Report on Form 20-F. The following discussion is limited as described in Item 10.E “Taxation — Certain Material U.S. Federal Income Tax Considerations” in our Annual Report on Form 20-F and as described herein.
This summary is necessarily general and may not apply to all categories of investors, some of whom may be subject to special rules, including, without limitation, persons that own or will own (directly, indirectly or constructively, applying certain attribution rules) 5% or more of the units or (directly, indirectly or constructively, applying certain attribution rules) 10% or more of the equity interests (by vote or value) of BBUC, dealers in securities or currencies, financial institutions or financial services entities, mutual funds, life insurance companies, persons that hold exchangeable shares as part of a straddle, hedge, constructive sale or conversion transaction with other investments, persons whose exchangeable shares are loaned to a short seller to cover a short sale of exchangeable shares, U.S. holders (as defined below) whose functional currency is not the U.S. dollar, persons who have elected mark-to-market accounting, persons who hold exchangeable shares through a partnership or other entity treated as a partnership for U.S. federal income tax purposes, persons for whom the exchangeable shares are not a capital asset, persons who are liable for the alternative minimum tax, certain U.S. expatriates or former long-term residents of the United States, and persons who are subject to special tax accounting rules under Section 451(b) of the Code. This summary does not address the consequences to U.S. holders who receive distributions on exchangeable shares other than in U.S. dollars. The actual tax consequences of the exchange of exchangeable shares for units may vary, depending on a holder’s individual circumstances.
For purposes of this discussion, a “U.S. holder” is a beneficial owner of exchangeable shares who is for U.S. federal income tax purposes: (i) an individual citizen or resident of the United States; (ii) a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source; or (iv) a trust (a) the primary supervision of which is subject to a court within the United States and all substantial decisions of which one or more U.S. persons have the authority to control or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.
A “non-U.S. holder” is a beneficial owner of exchangeable shares, other than a U.S. holder or an entity classified as a partnership or other fiscally transparent entity for U.S. federal tax purposes.
If a partnership holds exchangeable shares, the tax treatment of a partner of such partnership generally will depend upon the status of the partner and the activities of the partnership. Partners of partnerships that hold exchangeable shares should consult their tax advisors.
This discussion does not constitute tax advice and is not intended to be a substitute for tax planning. You should consult your own tax advisor concerning the U.S. federal, state and local income tax consequences particular to exchanging exchangeable shares for units, as well as any tax consequences under the laws of any other taxing jurisdiction.
Partnership Status of the Partnership and Holding LP
Each of the partnership and Holding LP has made a protective election to be classified as a partnership for U.S. federal tax purposes. An entity that is treated as a partnership for U.S. federal tax purposes generally incurs no U.S. federal income tax liability. Instead, each partner is generally required to take into account its allocable share of items of income, gain, loss, deduction, or credit of the partnership in computing its U.S.
34
 
federal income tax liability, regardless of whether cash distributions are made. Distributions of cash by a partnership to a partner generally are not taxable unless the amount of cash distributed to a partner is in excess of the partner’s adjusted basis in its partnership interest.
An entity that would otherwise be classified as a partnership for U.S. federal income tax purposes may nonetheless be taxable as a corporation if it is a “publicly traded partnership,” unless an exception applies. The partnership is publicly traded. However, an exception, referred to as the “Qualifying Income Exception,” exists with respect to a publicly traded partnership if (i) at least 90% of such partnership’s gross income for every taxable year consists of “qualifying income” and (ii) the partnership would not be required to register under the Investment Company Act of 1940 if it were a U.S. corporation. Qualifying income includes certain interest income, dividends, real property rents, gains from the sale or other disposition of real property, and any gain from the sale or disposition of a capital asset or other property held for the production of income that otherwise constitutes qualifying income.
The general partner of the partnership intends to manage the affairs of the partnership and Holding LP so that the partnership will meet the Qualifying Income Exception in each taxable year. Accordingly, the general partner of the partnership believes that the partnership will be treated as a partnership and not as a corporation for U.S. federal income tax purposes.
The remainder of this summary assumes that the partnership and Holding LP will be treated as partnerships for U.S. federal income tax purposes.
Characterization of the Exchangeable Shares
The U.S. federal income tax consequences for holders relating to the exchange of exchangeable shares for units will depend, in part, on whether the exchangeable shares are, for U.S. federal income tax purposes, treated as stock of BBUC and not as interests in the partnership. The general partner of the partnership intends to take the position and believes that the exchangeable shares are properly characterized as stock of BBUC for U.S. federal income tax purposes. However, the treatment of the exchangeable shares as stock of BBUC is not free from doubt, as there is no direct authority regarding the proper U.S. federal income tax treatment of securities similar to the exchangeable shares. If the exchangeable shares are not treated as stock of BBUC and are instead treated as units, then a holder of exchangeable shares generally would be expected to be taxed in the same manner as a holder of units, in which case the exchange of exchangeable shares for units may qualify as a tax-free exchange. The remainder of this summary assumes that the exchangeable shares will be treated as stock of BBUC for U.S. federal income tax purposes.
Consequences to U.S. Holders
Exchange of Exchangeable Shares.   Subject to the discussion below under the headings “— Exercise of the Partnership Call Right” and “— Passive Foreign Investment Company Considerations,” a U.S. holder generally will recognize capital gain or loss upon an exchange at the request of the holder (other than an exchange that is treated as a distribution, as discussed below) of exchangeable shares for units equal to the difference between the amount realized upon the exchange and the holder’s adjusted tax basis in the exchangeable shares so exchanged. The amount realized will equal the amount of cash, if any, plus the fair market value of the units received. Any such capital gain or loss will be long-term capital gain or loss if the holder’s holding period for the exchangeable shares exceeds one year at the time of the exchange. Gain or loss recognized by a U.S. holder generally will be treated as U.S.-source gain or loss for foreign tax credit limitation purposes. Long-term capital gains of non-corporate U.S. holders generally are taxed at preferential rates. The deductibility of capital losses is subject to limitations.
The U.S. federal income tax consequences described in the preceding paragraph should also apply to a U.S. holder whose exchange request is satisfied by the delivery of units by Brookfield pursuant to the rights agreement. For the U.S. federal income tax consequences to a U.S. holder whose exchange request is satisfied by the delivery of units pursuant to the partnership’s exercise of the partnership call right, see the discussion below under the heading “— Exercise of the Partnership Call Right.” The U.S. federal income tax consequences to a U.S. holder whose exchange request is satisfied by the delivery of units by BBUC is described in the following paragraph.
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An exchange of exchangeable shares satisfied by BBUC will result in the recognition of gain or loss by a U.S. holder, as described above, if the exchange is (i) in “complete redemption” of the U.S. holder’s equity interest in BBUC (within the meaning of Section 302(b)(3) of the Code), (ii) a “substantially disproportionate” redemption of stock (within the meaning of Section 302(b)(2) of the Code), or (iii) “not essentially equivalent to a dividend” ​(within the meaning of Section 302(b)(1) of the Code). In determining whether any of these tests has been met with respect to the exchange, each U.S. holder may be required to take into account not only the exchangeable shares and other equity interests in BBUC actually owned by the holder, but also other equity interests in BBUC that are constructively owned by the holder within the meaning of Section 318 of the Code. If a U.S. holder owns (actually or constructively) only an insubstantial percentage of the total equity interests in BBUC and exercises no control over BBUC’s corporate affairs, the holder may be entitled to sale or exchange treatment with respect to the exchange of exchangeable shares if the holder experiences a reduction in its equity interest in BBUC (taking into account any constructively owned equity interests) as a result of the exchange.
If a U.S. holder meets none of the alternative tests of Section 302(b) of the Code, the exchange would be treated as a distribution with respect to exchangeable shares. Subject to the discussion below under the heading “— Passive Foreign Investment Company Considerations”, the gross amount of a distribution paid to a U.S. holder with respect to exchangeable shares (including amounts withheld to pay Canadian withholding taxes) would be included in the holder’s gross income as a dividend to the extent paid out of BBUC’s current or accumulated earnings and profits (as determined under U.S. federal income tax principles). To the extent that the amount of the distribution exceeds BBUC’s current and accumulated earnings and profits, it would be treated first as a tax-free return of a U.S. holder’s tax basis in its exchangeable shares, and to the extent the amount of the distribution exceeds the U.S. holder’s tax basis, the excess would be taxed as capital gain. In the event that the exchange is properly treated as a distribution, the amount of the distribution would be equal to the amount of cash, if any, and the fair market value of the units received. Dividends received by individuals and other non-corporate U.S. holders may be subject to tax at preferential rates applicable to long-term capital gains, provided certain conditions are met.
Because the determination as to whether any of the alternative tests of Section 302(b) of the Code is satisfied with respect to any particular U.S. holder that exchanges exchangeable shares for units will depend upon the facts and circumstances as of the time the determination is made, each U.S. holder should consult its tax advisor regarding the tax treatment of the exchange, including the calculation of the holder’s tax basis in any remaining exchangeable shares in the event of an exchange that is treated as a distribution.
Exercise of the Partnership Call Right. The partnership has the right to acquire exchangeable shares directly from a holder under certain circumstances in exchange for units or cash (the “partnership call right”). The U.S. federal income tax consequences to a U.S. holder of the exchange of exchangeable shares for units pursuant to the exercise of the partnership call right will depend in part on whether the exchange qualifies as tax-free under Section 721(a) of the Code. For the exchange to so qualify, the partnership (i) must be classified as a partnership and not as an association or publicly traded partnership taxable as a corporation for U.S. federal income tax purposes and (ii) must not be treated as an investment company for purposes of Section 721(b) of the Code. With respect to the classification of the partnership as a partnership, see the discussion above under the heading “Partnership Status of the Partnership and Holding LP.”
Section 721(b) of the Code provides that Section 721(a) of the Code will not apply to gain realized on a transfer of property to a partnership which would be treated as an investment company (within the meaning of Section 351 of the Code) if the partnership were incorporated. Under Section 351 of the Code and the Treasury Regulations thereunder, a transfer of property will be considered a transfer to an investment company only if (i) the transfer results, directly or indirectly, in “diversification” of the transferor’s interests, and (ii) the transferee is a regulated investment company, a real estate investment trust, or a corporation more than 80% of the value of whose assets are held for investment and (subject to certain exclusions) are stock or securities, as defined in Section 351(e) of the Code. For purposes of this determination, the stock and securities of a corporate subsidiary are disregarded and the parent corporation is treated as owning its ratable share of the subsidiary’s assets if the parent corporation owns 50% or more of the subsidiary corporation’s stock by voting power or value. The Treasury Regulations also provide that whether an entity is an investment company ordinarily will be determined by reference to the circumstances in existence immediately after the transfer in question. However, where circumstances change thereafter pursuant to a plan in existence at the time of the transfer, this determination will be made by reference to the later circumstances.
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Based on the shareholders’ rights in the event of the liquidation or dissolution of BBUC (or the partnership) and the terms of the exchangeable shares, which are intended to provide an economic return equivalent to the economic return on units (including identical distributions), and taking into account the expected relative values of the partnership’s assets and its ratable share of the assets of its subsidiaries for the foreseeable future, the general partner of the partnership currently does not expect a U.S. holder’s transfer of exchangeable shares in exchange for units pursuant to the partnership’s exercise of the partnership call right to be treated as a transfer of property to an investment company within the meaning of Section 721(b) of the Code. Thus, the general partner of the partnership currently expects such exchange to qualify as tax-free under Section 721(a) of the Code. However, no definitive determination can be made as to whether any such future exchange will qualify as tax-free under Section 721(a) of the Code, as this will depend on the facts and circumstances at the time of the exchange. Many of these facts and circumstances are not within the control of the partnership, and no assurance can be provided as to the position, if any, taken by the general partner of the partnership with regard to the U.S. federal income tax treatment of any such exchange. Nor can any assurance be given that the IRS will not assert, or that a court would not sustain, a position contrary to any future position taken by the partnership. If the partnership were an investment company immediately following the exchange of exchangeable shares for units by a U.S. holder pursuant to the exercise of the partnership call right, and such exchange were to result in diversification of interests with respect to the U.S. holder, then Section 721(a) of the Code would not apply with respect to the holder, and the holder would be treated as if the holder had sold its exchangeable shares to the partnership in a taxable transaction for cash in an amount equal to the value of the units received.
Even if a U.S. holder’s transfer of exchangeable shares in exchange for units pursuant to the partnership’s exercise of the partnership call right qualifies as tax-free under Section 721(a) of the Code, the U.S. holder will be subject to special rules that may result in the recognition of additional taxable gain or income. Under Section 704(c)(1) of the Code, if appreciated property is contributed to a partnership, the contributing partner must recognize any gain that was realized but not recognized for U.S. federal income tax purposes with respect to the property at the time of the contribution (referred to as “built-in gain”) if the partnership sells such property (or otherwise transfers such property in a taxable exchange) at any time thereafter or distributes such property to another partner within seven years of the contribution in a transaction that does not otherwise result in the recognition of built-in gain by the partnership. If Section 704(c)(1) of the Code applies with respect to a U.S. holder, and the holder fails to disclose to the partnership its basis in exchangeable shares exchanged for units pursuant to the exercise of the partnership call right, then, solely for the purpose of allocating items of income, gain, loss, or deduction under Section 704(c) of the Code, the general partner of the partnership intends to use a reasonable method to estimate the holder’s basis in the exchangeable shares exchanged for units pursuant to the exercise of the partnership call right. To ensure compliance with Section 704(c) of the Code, such estimated basis could be lower than a U.S. holder’s actual basis in its exchangeable shares. As a result, the amount of gain reported by the partnership to the IRS with respect to the U.S. holder in connection with such subsequent transfers could be greater than the correct amount.
If Section 704(c)(1) does not apply as a result of any such subsequent transfers by the partnership or Holding LP of exchangeable shares transferred by a U.S. holder for units in an exchange qualifying as tax-free under Section 721(a) of the Code, then the U.S. holder could, nonetheless, be required to recognize part or all of the built-in gain in its exchangeable shares deferred as a result of such exchange under other provisions of the Code. Under Section 737 of the Code, the U.S. holder could be required to recognize built-in gain if the partnership were to distribute any property of the partnership other than money (or, in certain circumstances, exchangeable shares) to such former holder of exchangeable shares within seven years of exercise of the partnership call right. Under Section 707(a) of the Code, the U.S. holder could also be required to recognize built-in gain in certain circumstances. Section 707(a) of the Code and the Treasury Regulations thereunder create a presumption that any distributions of cash or other property made by a partnership to a partner that contributed property within two years of the distribution will be treated as a payment in consideration for the property otherwise treated as contributed to the partnership in exchange for a partnership interest, with certain limited exceptions, including an exception for “operating cash flow distributions.” For this purpose, an “operating cash flow distribution” is any distribution, including, but not limited to, a complete or partial redemption distribution, that does not exceed the product of the “net cash flow from operations” ​(as defined in the applicable Treasury Regulations) of the partnership for the year multiplied by the lesser of the partner’s percentage interest in overall partnership profits for that year or the partner’s percentage interest in overall partnership profits for the life of the partnership. If a distribution to a U.S. holder within two years of
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the transfer of exchangeable shares in exchange for units is treated as part of a deemed sale transaction under Section 707(a) of the Code, the U.S. holder will recognize gain or loss in an amount equal to the difference between (i) the amount of cash and the fair market value of the property received and (ii) the U.S. holder’s adjusted tax basis in the exchangeable shares deemed to have been sold. Such gain or loss will be recognized in the year of the transfer of exchangeable shares in exchange for units, and, if the U.S. holder has already filed a tax return for such year, the holder may be required to file an amended return. In such a case, the U.S. holder may also be required to report some amount of imputed interest income.
If Section 721(a) of the Code applies to a U.S. holder’s exchange of exchangeable shares for units pursuant to the exercise of the partnership call right by the partnership and none of the special provisions described in the two preceding paragraphs applies, then the U.S. holder generally should not recognize gain or loss with respect to exchangeable shares treated as contributed to the partnership in exchange for units, except as described below under the heading “— Passive Foreign Investment Company Considerations.” The aggregate tax basis of the units received by the U.S. holder pursuant to the partnership call right would be the same as the aggregate tax basis of the exchangeable shares (or single undivided portion thereof) exchanged therefor, increased by the holder’s share of the partnership’s liabilities, if any. The holding period of the units received in exchange for exchangeable shares would include the holding period of the exchangeable shares surrendered in exchange therefor. A U.S. holder who acquired different blocks of exchangeable shares at different times or different prices should consult its tax advisor regarding the manner in which gain or loss should be determined in the holder’s particular circumstances and the holder’s holding period in units received in exchange for exchangeable shares.
For a general discussion of the tax consequences to a U.S. holder of owning and disposing of units received in exchange for exchangeable shares, see the discussion in Item 10.E “Taxation — Certain Material U.S. Federal Income Tax Considerations” in our Annual Report on Form 20-F. The U.S. federal income tax consequences of exchanging exchangeable shares for units are complex, and each U.S. holder should consult its tax advisor regarding such consequences in light of the holder’s particular circumstances.
Passive Foreign Investment Company Considerations.   Certain adverse tax consequences could apply to a U.S. holder if BBUC is treated as a passive foreign investment company (“PFIC”) for any taxable year during which the U.S. holder holds exchangeable shares. A non-U.S. corporation, such as BBUC, will be classified as a PFIC for U.S. federal income tax purposes for any taxable year in which, after applying certain look-through rules, either (i) 75% or more of its gross income for such year consists of certain types of “passive” income or (ii) 50% or more of the value of its assets during such year produce or are held for the production of passive income. Passive income generally includes dividends, interest, royalties, rents, annuities, net gains from the sale or exchange of property producing such income, and net foreign currency gains.
Based on its current and expected income, assets, and activities, BBUC does not expect to be a PFIC for the current taxable year, nor does it expect to become a PFIC in the foreseeable future. However, the determination of whether BBUC is or will be a PFIC must be made annually as of the close of each taxable year. Because PFIC status depends upon the composition of BBUC’s income and assets from time to time, there can be no assurance that BBUC will not be considered a PFIC for any taxable year, or that the IRS or a court will agree with BBUC’s determination as to its PFIC status.
If BBUC were a PFIC for any taxable year during which a U.S. holder held exchangeable shares, then gain recognized by the U.S. holder upon the sale or other taxable disposition of the exchangeable shares (such as gain from a taxable exchange of exchangeable shares for units) generally would be allocated ratably over the U.S. holder’s holding period for the exchangeable shares. The amounts allocated to the taxable year of the sale or other taxable disposition and to any year before BBUC became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, for that taxable year, and an interest charge would be imposed on the tax on such amount. Further, to the extent that any distribution received by a U.S. holder on its exchangeable shares were to exceed 125% of the average of the annual distributions on the exchangeable shares received during the preceding three years or the U.S. holder’s holding period, whichever is shorter, that distribution would be subject to taxation in the same manner as gain, described immediately above. Similar rules would apply with respect to any lower-tier PFICs treated as owned indirectly by a U.S. holder through the holder’s ownership of exchangeable shares.
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Certain elections may be available to U.S. holders to mitigate some of the adverse tax consequences resulting from PFIC treatment. If a U.S. holder were to elect to treat its interest in BBUC as a “qualified electing fund” ​(“QEF election”) for the first year the holder were treated as holding such interest, then in lieu of the tax consequences described in the paragraph immediately above, the U.S. holder would be required to include in income each year a portion of the ordinary earnings and net capital gains of BBUC, even if not distributed to the holder. A QEF election must be made by a U.S. holder on an entity-by-entity basis. To make a QEF election, a U.S. holder must, among other things, (i) obtain a PFIC annual information statement and prepare and submit IRS Form 8621 with the holder’s annual income tax return. To the extent reasonably practicable, BBUC intends to make available information related to the PFIC status of BBUC and any other subsidiary of BBUC that it is able to identify as a PFIC with respect to U.S. holders, including information necessary to make a QEF election with respect to each such entity.
In the case of a PFIC that is a publicly traded foreign company, and in lieu of making a QEF election, an election may be made to “mark to market” the stock of such publicly traded foreign company on an annual basis. Pursuant to such an election, a U.S. holder would include in each year as ordinary income the excess, if any, of the fair market value of such stock over its adjusted basis at the end of the taxable year. No assurance can be provided that BBUC or any of its subsidiaries will qualify as PFICs that are publicly traded or that a mark-to-market election will be available for any such entity.
Subject to certain exceptions, a U.S. person who directly or indirectly owns an interest in a PFIC generally is required to file an annual report with the IRS, and the failure to file such report could result in the imposition of penalties on such U.S. person and in the extension of the statute of limitations with respect to federal income tax returns filed by such U.S. person. The application of the PFIC rules to U.S. holders is uncertain in certain respects. Each U.S. holder should consult its tax advisor regarding the application of the PFIC rules, including the foregoing filing requirements and the advisability of making any available election under the PFIC rules, with regard to the holder’s ownership and disposition of exchangeable shares.
Additional Tax on Net Investment Income.   Certain U.S. holders that are individuals, estates or trusts are subject to a 3.8% tax on all or a portion of their “net investment income,” which may include all or a portion of their dividend income and net gains from the disposition of exchangeable shares. Each U.S. holder that is an individual, estate or trust should consult its tax advisors regarding the applicability of this tax to its income and gains in respect of exchangeable shares.
Foreign Financial Asset Reporting.   Certain U.S. holders are required to report information relating to an interest in the exchangeable shares, subject to certain exceptions (including an exception for shares held in accounts maintained by certain financial institutions) by filing IRS Form 8938 (Statement of Specified Foreign Financial Assets) with their U.S. federal income tax returns. Significant penalties may apply for the failure to satisfy these reporting obligations. U.S. holders are urged to consult their tax advisors regarding the information reporting obligations, if any, with respect to their ownership and disposition of exchangeable shares.
Information Reporting and Backup Withholding.   Distributions on exchangeable shares made to a U.S. holder and proceeds from the sale or other disposition of exchangeable shares (including by reason of a taxable exchange of exchangeable shares for units) may, under certain circumstances, be subject to information reporting and backup withholding, unless the holder provides proof of an applicable exemption or, in the case of backup withholding, furnishes its taxpayer identification number and otherwise complies with all applicable requirements of the backup withholding rules. Backup withholding is not an additional tax and generally will be allowed as a refund or credit against the holder’s U.S. federal income tax liability, provided that the required information is timely furnished to the IRS.
Consequences to Non-U.S. Holders
The exchange of exchangeable shares for units by a non-U.S. holder generally should not be subject to U.S. federal income tax. Special rules may apply to any non-U.S. holder (i) that has an office or fixed place of business in the United States; (ii) that is present in the United States for 183 days or more in a taxable year; or that is (a) a former citizen or long-term resident of the United States, (b) a foreign insurance company that is treated as holding a partnership interest in the partnership in connection with its U.S. business, (c) a PFIC,
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(d) a controlled foreign corporation, or (e) a corporation that accumulates earnings to avoid U.S. federal income tax. Non-U.S. holders should consult their tax advisors regarding the application of these special rules.
THE FOREGOING DISCUSSION IS NOT INTENDED AS A SUBSTITUTE FOR CAREFUL TAX PLANNING. THE TAX MATTERS RELATING TO THE PARTNERSHIP, HOLDERS OF UNITS, BBUC, AND HOLDERS OF EXCHANGEABLE SHARES ARE COMPLEX AND ARE SUBJECT TO VARYING INTERPRETATIONS. MOREOVER, THE EFFECT OF EXISTING INCOME TAX LAWS, THE MEANING AND IMPACT OF WHICH IS UNCERTAIN, AND OF PROPOSED CHANGES IN INCOME TAX LAWS WILL VARY WITH THE PARTICULAR CIRCUMSTANCES OF EACH HOLDER, AND IN REVIEWING THIS PROSPECTUS THESE MATTERS SHOULD BE CONSIDERED. EACH HOLDER SHOULD CONSULT ITS TAX ADVISORS WITH RESPECT TO THE U.S. FEDERAL, STATE, LOCAL, AND OTHER TAX CONSEQUENCES OF THE EXCHANGE OF EXCHANGEABLE SHARES FOR UNITS.
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MATERIAL CANADIAN FEDERAL INCOME TAX CONSIDERATIONS
The following describes certain material Canadian federal income tax consequences with respect to the exchange of exchangeable shares for units as described in this prospectus as of the date hereof by a holder who, at all relevant times, is the beneficial owner of such exchangeable shares and, for the purposes of the Income Tax Act (Canada) (the “Tax Act”), (i) deals at arm’s length and is not affiliated with BBUC and the partnership and (ii) holds the exchangeable shares as capital property (a “Holder”). Generally, the exchangeable shares will be considered to be capital property to a Holder provided the Holder does not hold such shares in the course of carrying on a business of trading or dealing in securities and has not acquired them in one or more transactions considered to be an adventure or concern in the nature of trade.
This summary is based upon the facts as set out in this prospectus, the current provisions of the Tax Act and the regulations thereunder, and the current administrative policies and assessing practices of the Canada Revenue Agency (the “CRA”) published in writing prior to the date hereof. This summary takes into account all specific proposals to amend the Tax Act and the regulations thereunder publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the “Proposed Amendments”), and assumes that all Proposed Amendments will be enacted in the form proposed. However, no assurances can be given that the Proposed Amendments will be enacted as proposed, or at all. This summary does not otherwise take into account or anticipate any changes in law or administrative policy or assessing practice whether by legislative, administrative or judicial action or decision, nor does it take into account tax legislation or considerations of any province, territory or foreign jurisdiction, which may differ from those discussed herein.
This summary should be read in conjunction with the discussion of the material Canadian federal income tax considerations associated with the holding and disposition of units set forth in Item 10.E “Taxation — Certain Material Canadian Federal Income Tax Considerations” and Item 3.D “Risk Factors — Risks Related to Taxation” in the partnership’s most recent Annual Report on Form 20-F. The following discussion is limited as described in Item 10.E “Taxation — Certain Material Canadian Federal Income Tax Considerations” in the partnership’s most recent Annual Report on Form 20-F and as described herein.
This summary assumes that at all relevant times (i) the exchangeable shares will be listed on a “designated stock exchange” in Canada for the purposes of the Tax Act (which currently includes the TSX), (ii) not more than 50% of the fair market value of an exchangeable share or a unit is attributable to one or more properties each of which is real property in Canada, a “Canadian resource property” or a “timber resource property”, and (iii) neither the partnership nor BBUC is a “tax shelter” or a “tax shelter investment”, each as defined in the Tax Act. In addition, BBUC expects that at all relevant times, all or substantially all of its property and the units of the partnership will not be “taxable Canadian property” as defined in the Tax Act. However, no assurance can be given in relation to the foregoing.
Following the Special Distribution, BBUC will qualify as a “mutual fund corporation” as defined in the Tax Act. BBUC intends to file the necessary election under the Tax Act so that it will be deemed to be a “public corporation” effective from the beginning of its first taxation year, and therefore can qualify as a “mutual fund corporation” throughout its first taxation year. To maintain its “mutual fund corporation” status, BBUC is required to comply with specific restrictions under the Tax Act regarding its activities and the investments held by it. BBUC intends to continue to qualify as a “mutual fund corporation” throughout each taxation year in which exchangeable shares are outstanding and this summary assumes that will be the case. If BBUC was to cease to qualify as a “mutual fund corporation”, material adverse tax consequences to it and the Holders may arise.
This summary also relies as to certain matters on an officer’s certificate of BBUC.
This summary is not applicable to a holder: (i) an interest in which would be a “tax shelter investment” or who holds or acquires exchangeable shares or units as a “tax shelter investment”; (ii) that is a “financial institution” for purposes of the “mark-to-market property” rules; (iii) that reports its “Canadian tax results” in a currency other than Canadian currency; (iv) that has entered or will enter into a “derivative forward agreement” in respect of the exchangeable shares or the units (each as defined in the Tax Act); or (v) that is a corporation resident in Canada and is, or becomes (or does not deal at arm’s length for purposes of the Tax Act with a corporation that is or becomes) as part of a transaction or event or series of transactions or events
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that includes the acquisition of the exchangeable shares, controlled by a non-resident person or a group of non-resident persons not dealing with each other at arm’s length for purposes of section 212.3 of the Tax Act. Furthermore, this summary is not applicable to a Holder that is a “controlling corporation” of BBUC (for purposes of subsection 191(1) of the Tax Act), a person with whom the controlling corporation does not deal at arm’s length or a partnership or trust of which the controlling corporation or person with whom the controlling corporation does not deal at arm’s length is a member or beneficiary for purposes of the Tax Act. Such Holders should consult their own tax advisors.
This summary is of a general nature only and is not, and is not intended to be, nor should it be construed to be, legal or tax advice to any particular Holder, and no representation concerning the tax consequences to any particular Holder or prospective Holder are made. This summary is not exhaustive of all Canadian federal income tax considerations. Accordingly, prospective Holders should consult their own tax advisors with respect to an investment in the exchangeable shares having regard to their particular circumstances.
Generally, for purposes of the Tax Act, all amounts relating to the disposition of exchangeable shares (including on an exchange for units at the request of a Holder) must be expressed in Canadian currency. Amounts denominated in another currency must be converted into Canadian currency using the applicable rate of exchange (pursuant to the Tax Act) quoted by the Bank of Canada on the date such amounts arose, or such other rate of exchange as is acceptable to the CRA.
Taxation of Holders Resident in Canada
The following portion of the summary is generally applicable to a Holder who, at all relevant times, is resident or deemed to be resident in Canada under the Tax Act (a “Resident Holder”). Certain Resident Holders may be entitled to make, or may have already made, the irrevocable election permitted by subsection 39(4) of the Tax Act the effect of which may be to deem any exchangeable shares (and all other “Canadian securities”, as defined in the Tax Act) owned by such Resident Holder to be capital property in the taxation year in which the election is made and in all subsequent taxation years. Resident Holders whose exchangeable shares might not otherwise be considered to be capital property should consult their own tax advisors concerning this election.
Exchange of Exchangeable Shares.   A Resident Holder who disposes of, or who is deemed to dispose of, exchangeable shares (including on an exchange for units at the request of the Resident Holder) will realize a capital gain (or sustain a capital loss) equal to the amount by which the proceeds of disposition exceed (or are exceeded by) the aggregate of the Resident Holder’s adjusted cost base of such shares and any reasonable costs of disposition.
In general, one-half of a capital gain realized by a Resident Holder in a taxation year must be included in income as a taxable capital gain. One-half of a capital loss realized by a Resident Holder in a taxation year generally must be deducted as an “allowable capital loss” against taxable capital gains realized in the year. Allowable capital losses in excess of taxable capital gains realized in a taxation year may be carried back and deducted in any of the three preceding taxation years or carried forward and deducted in any subsequent taxation year against net taxable capital gains realized in such years in accordance with the provisions of the Tax Act.
The amount of any capital loss realized by a Resident Holder that is a corporation on the disposition of exchangeable shares may be reduced by the amount of any dividends received or deemed to be received by the Resident Holder on such exchangeable shares to the extent and under the circumstances described in the Tax Act. Similar rules may apply where exchangeable shares are owned by a partnership or trust of which a corporation, partnership or trust is a member or beneficiary. Such Resident Holders should consult their own advisors.
A taxable capital gain realized by a Resident Holder that is an individual (other than certain trusts) may give rise to a liability for alternative minimum tax.
The cost to a Resident Holder of a unit received on the exchange of an exchangeable share will equal the fair market value of the exchangeable share for which it was exchanged at the time of the exchange. The
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adjusted cost base to a Resident Holder of the units at any time will be determined by averaging the cost of such units with the adjusted cost base of any other units owned by the Resident Holder as capital property at the time.
For a description of the Canadian federal income tax considerations of holding and disposing of units, see the discussion in Item 10.E “Taxation — Certain Material Canadian Federal Income Tax Considerations” in our Annual Report on Form 20-F.
Additional Refundable Tax.   A Resident Holder that is throughout its taxation year a “Canadian- controlled private corporation” ​(as defined in the Tax Act) will be liable to pay an additional refundable tax on its “aggregate investment income”, which includes an amount in respect of net taxable capital gains. Pursuant to certain Proposed Amendments, this additional refundable tax in respect of “aggregate investment income” would apply also to “substantive CCPCs”, as defined in the Proposed Amendments. Holders are advised to consult their own tax advisors in this regard.
Taxation of Holders Not Resident in Canada
The following portion of the summary is generally applicable to a Holder who, at all relevant times, for the purposes of the Tax Act, is not, and is not deemed to be, resident in Canada and does not use or hold the exchangeable shares in a business carried on in Canada (a “Non-Resident Holder”). Special rules, which are not discussed in this summary, may apply to a Non-Resident Holder that is an insurer that carries on an insurance business in Canada and elsewhere.
Exchange of Exchangeable Shares.   A Non-Resident Holder will not be subject to tax under the Tax Act on a disposition or deemed disposition of exchangeable shares (including on an exchange for units at the request of the Non-Resident Holder) unless the exchangeable shares are “taxable Canadian property” of the Non-Resident Holder for purposes of the Tax Act at the time of the disposition or deemed disposition and the Non-Resident Holder is not entitled to relief under an applicable income tax convention between Canada and the country in which the Non-Resident Holder is resident.
Generally, the exchangeable shares will not constitute “taxable Canadian property” of a Non-Resident Holder at a particular time provided that BBUC is a mutual fund corporation unless, at any particular time during the 60-month period that ends at that time, both of the following conditions are met concurrently: (a) 25% or more of the issued shares of any class of the capital stock of BBUC were owned by or belonged to one or any combination of (i) the Non-Resident Holder, (ii) persons with whom the Non-Resident Holder did not deal at arm’s length for purposes of the Tax Act, and (iii) partnerships in which the Non-Resident Holder or a person described in (ii) holds a membership interest directly or indirectly through one or more partnerships; and (b) more than 50% of the fair market value of the exchangeable shares was derived, directly or indirectly, from one or any combination of: (i) real or immovable property situated in Canada, (ii) “Canadian resource properties”(as defined in the Tax Act), (iii) “timber resource properties”(as defined in the Tax Act), and (iv) options in respect of, or interests in, or for civil law rights in, property described in any of (b)(i) to (iii), whether or not the property exists. A Holder of exchangeable shares that also holds one or more units will generally meet the condition in (a) above; however, BBUC does not expect that the condition in (b) will be met.
Notwithstanding the foregoing, in certain circumstances set out in the Tax Act, the exchangeable shares may be deemed to be “taxable Canadian property.” Non-Resident Holders for whom exchangeable shares may constitute “taxable Canadian property” should consult their own tax advisors.
The cost to a Non-Resident Holder of a unit received on the exchange of an exchangeable share will equal the fair market value of the exchangeable share for which it was exchanged at the time of the exchange. The adjusted cost base to a Non-Resident Holder of units at any time will be determined by averaging the cost of such units with the adjusted cost base of any other units owned by the Non-Resident Holder as capital property at the time.
For a description of the Canadian federal income tax considerations of holding and disposing of units, see the section titled in Item 10.E “Taxation — Certain Material Canadian Federal Income Tax Considerations” in our Annual Report on Form 20-F.
43
 
LEGAL MATTERS
The validity of the units offered hereby and certain other legal matters with respect to the laws of Bermuda will be passed upon for us by Appleby (Bermuda) Limited.
EXPERTS
The financial statements of the partnership as of December 31, 2021 and 2020, and for each of the three years in the period ended December 31, 2021, incorporated by reference in this prospectus and the effectiveness of the partnership’s internal control over financial reporting have been audited by Deloitte LLP, an independent registered public accounting firm, as stated in their reports. Such financial statements are incorporated by reference in reliance upon the reports of such firm given their authority as experts in accounting and auditing. The offices of Deloitte LLP are located at 8 Adelaide Street West, Toronto, Ontario M5H 0A9.
The consolidated financial statements of Modulaire Investments 2 S.à r.l. as of and for the year ended December 31, 2020, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, and subject to an audit under AICPA standards, have been incorporated by reference herein in reliance upon the report of PricewaterhouseCoopers, Société coopérative, and upon the authority of said firm as experts in accounting and auditing. The address of PricewaterhouseCoopers, Société coopérative is 2 rue Gerhard Mercator, L-2182 Luxembourg, Grand Duchy of Luxembourg.
The combined financial statements of the Lottery Business (a carve-out of certain operations of Scientific Games Corporation) as of December 31, 2021 and 2020, and for each of the three years in the period ended December 31, 2021, incorporated by reference in this prospectus, have been audited by Deloitte & Touche LLP, an independent auditor, as stated in their report. Such financial statements are incorporated by reference in reliance upon the report of such firm given their authority as experts in accounting and auditing. The address of Deloitte & Touche LLP is 3883 Howard Hughes Parkway, Suite 400, Las Vegas, Nevada, 89169, United States of America.
The financial statements of CDK Global, Inc. as of June 30, 2021 and 2020, and for each of the three years in the period ended June 30, 2021, incorporated by reference in this prospectus, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report. Such financial statements are incorporated by reference in reliance upon the report of such firm given their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the information and periodic reporting requirements of the Exchange Act applicable to “foreign private issuers” ​(as such term is defined in Rule 405 under the Securities Act) and will fulfill the obligations with respect to those requirements by filing or furnishing reports with the SEC. In addition, we are required to file documents filed with the SEC with the securities regulatory authority in each of the provinces and territories of Canada. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding us and other issuers that file electronically with the SEC. The address of the SEC Internet site is www.sec.gov. You are invited to read and copy any reports, statements or other information, other than confidential filings, that we file with the Canadian securities regulatory authorities. These filings are electronically available from the Canadian System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com, the Canadian equivalent of the SEC electronic document gathering and retrieval system. This information is also available on our website at https://bbu.brookfield.com. Throughout the period of distribution, copies of these materials will also be available for inspection during normal business hours at the offices of our service provider at Brookfield Place, 250 Vesey Street, 15th Floor, New York, New York, United States 10281.
44
 
As a foreign private issuer, we are exempt from the rules under the Exchange Act related to the furnishing and content of proxy statements, and our officers, directors and principal unitholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act relating to their purchases and sales of units. In addition, we are not required under the Exchange Act to file annual, quarterly and current reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. However, we intend to file with the SEC, as soon as practicable, and in any event within 120 days after the end of each fiscal year, an annual report on Form 20-F containing financial statements audited by an independent public accounting firm. We also intend to furnish quarterly reports on Form 6-K containing unaudited interim financial information for each of the first three quarters of each fiscal year.
INCORPORATION BY REFERENCE
The SEC allows us to “incorporate by reference” into this prospectus certain documents that we file with or furnish to the SEC. This means that we can disclose important information to you by referring to those documents. The information incorporated by reference is considered to be an important part of this prospectus, and later information that we file with the SEC will automatically update and supersede that information. The following documents, which we have filed with or furnished to the SEC, are specifically incorporated by reference in this prospectus:
•
​
•
​
•
​
•
​
In addition, all subsequent annual reports filed by us with the SEC on Form 20-F and any current reports on Form 6-K filed or furnished by us that is identified in such form as being incorporated by reference into the registration statement of which this prospectus forms a part, in each case subsequent to the date of this prospectus and prior to the termination of this offering, shall be deemed to be incorporated by reference into this prospectus as of the date of the filing or furnishing of such documents. We shall undertake to provide without charge to each person to whom a copy of this prospectus has been delivered, upon the written or oral request of any such person to us, a copy of any or all of the documents referred to above that have been or may be incorporated into this prospectus by reference, including exhibits to such documents. Requests for such copies should be directed to:
Brookfield Business Partners L.P.
73 Front Street, 5th Floor
Hamilton HM 12
Bermuda
+441-294-3309
Any statement contained in this prospectus or in a document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed to be modified or superseded, for the purposes of this prospectus, to the extent that a statement contained in this prospectus or in any other subsequently filed or furnished document which also is or is deemed to be incorporated by reference in this prospectus, modifies or supersedes that 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 to be 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.
45
 
SERVICE OF PROCESS AND ENFORCEABILITY OF CIVIL LIABILITIES
The partnership is organized under the laws of Bermuda. A substantial portion of the partnership’s assets may be located outside of Canada and the United States and certain of its directors, as well as certain of the experts named in this prospectus, may be residents of jurisdictions outside of Canada and the United States. The partnership has expressly submitted to the jurisdiction of Ontario courts and has appointed an attorney for service of process in Ontario and in the United States. However, it may be difficult for investors to effect service within Ontario or elsewhere in Canada or the United States upon those directors and experts who are not residents of Canada or the United States, as applicable. Investors are advised that it may also not be possible for investors to enforce judgments obtained in Canada or the United States against any person or company that is incorporated, continued or otherwise organized under the laws of a foreign jurisdiction or resides outside of Canada or the United States, even if the party has appointed an agent for service of process. Furthermore, it may be difficult to realize upon or enforce in Canada or the United States any judgment of a court of Canada or the United States against the partnership, the directors of the partnership’s general partner or the experts named in this prospectus since a substantial portion of the partnership’s assets and the assets of such persons may be located outside of Canada and the United States.
The partnership has been advised by counsel that there is no treaty in force between Canada and Bermuda or the United States and Bermuda providing for the reciprocal recognition and enforcement of judgments in civil and commercial matters. As a result, whether a Canadian or U.S. judgment would be capable of being the subject of enforcement proceedings in Bermuda against the partnership, the partnership’s directors or the experts named in this prospectus depends on whether the Canadian or U.S. court that entered the judgment is recognized by a Bermuda court as having jurisdiction over the partnership, the directors of the partnership’s general partner or the experts named in this prospectus, as determined by reference to Bermuda conflict of law rules. The courts of Bermuda would likely recognize as a valid, final and conclusive judgment in personam in respect of a judgment obtained in a Canadian or U.S. court pursuant to which a debt or definitive sum of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges of a like nature or in respect of a fine or other penalty) as long as (i) the Canadian or U.S. court had proper jurisdiction over the parties subject to the Canadian or U.S. judgment according to Bermuda’s conflicts of law principles and had jurisdiction to give the judgment as a matter of Bermuda law; (ii) the Canadian or U.S. court did not contravene the rules of natural justice of Bermuda; (iii) the Canadian or U.S. judgment was not obtained by fraud; (iv) the enforcement of the Canadian or U.S. judgment would not be contrary to the public policy of Bermuda; and (v) the Canadian or U.S. judgment (being a foreign judgment) does not conflict with a prior Bermuda judgment.
In addition to and irrespective of jurisdictional issues, Bermuda courts will not enforce a provision of Canadian or U.S. federal securities laws that is either penal in nature or contrary to public policy. It is the advice of the partnership’s Bermuda counsel that an action brought pursuant to a public or penal law, the purpose of which is the enforcement of a sanction, power or right at the instance of the state in its sovereign capacity, is unlikely to be entertained by Bermuda. Specified remedies available under the laws of Canadian or U.S. jurisdictions, including specified remedies under Canadian securities laws or U.S. federal securities laws, would not likely be available under Bermuda law or enforceable in a Bermuda court, as, among other reasons, they may be contrary to Bermuda public policy. Further, no claim may be brought in Bermuda against the partnership, the directors of the partnership’s general partner or the experts named in this prospectus in the first instance for a violation of Canadian securities laws or U.S. federal securities laws because these laws have no extraterritorial application under Bermuda law and do not have force of law in Bermuda.
EXPENSES
The following are the estimated expenses incurred or expected to be incurred in connection with the exchanges of exchangeable shares for units being registered under the registration statement of which this prospectus forms a part, all of which will be paid by us.
​
SEC registration fee
​ ​ ​ $ 136,547.10 ​ ​
​
Transfer agent fees
​ ​ ​ ​ 20,000 ​ ​
​
Legal fees and expenses
​ ​ ​ ​ 30,000 ​ ​
​
Accounting fees and expenses
​ ​ ​ ​ 60,000 ​ ​
​
Total
​ ​ ​ $ 246,547.10 ​ ​
46
 
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 8.
Indemnification of Directors and Officers.
​
The sections of the Annual Report on Form 20-F of Brookfield Business Partners L.P. (the “partnership”) for the year ended December 31, 2021 entitled “Item 6.C. Board Practices — Indemnification and Limitations on Liability,” “Item 7.B. Related Party Transactions — Master Services Agreement — Indemnification and Limitation on Liability,” “Item 10.B. Memorandum and Articles of Association — Description of Our Units and Our Limited Partnership Agreement — Indemnification; Limitations on Liability,” and “Item 10.B. Memorandum and Articles of Association — Description of the Holding LP Limited Partnership Agreement — Indemnification; Limitations on Liability” include disclosure relating to the indemnification of certain of the partnership’s affiliates and the directors and officers of the partnership’s general partner and the partnership’s service providers and are incorporated by reference herein.
Item 9.
Exhibits.
​
The following exhibits have been filed or incorporated by reference as part of this Registration Statement on Form F-3:
​
EXHIBIT
NUMBER
​ ​
DESCRIPTION
​
​ 3.1 ​ ​ ​
​ 3.2 ​ ​ ​
​ 3.3 ​ ​ ​
​ 3.4 ​ ​ ​
​ 3.5 ​ ​ ​
​ 4.1 ​ ​ ​
​ 4.2 ​ ​ ​
​ 5.1 ​ ​ Opinion of Appleby (Bermuda) Limited with respect to certain matters of Bermuda law ​
​ 23.1 ​ ​ Consent of Deloitte LLP ​
​ 23.2 ​ ​ Consent of PricewaterhouseCoopers, Société coopérative ​
​ 23.3 ​ ​ Consent of Deloitte & Touche LLP ​
​ 23.4 ​ ​ Consent of Deloitte & Touche LLP ​
​ 23.5 ​ ​ Consent of Appleby (Bermuda) Limited (included in the opinion filed as Exhibit 5.1 hereto) ​
​ 24.1 ​ ​ Power of Attorney (included in the signature page) ​
​ 99.1 ​ ​ ​
​  107 ​ ​ Filing Fee Table ​
II-1
 
Item 10.
Undertakings.
​
(a)   The undersigned Registrant hereby undertakes:
(1)   To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:
(i)   To include any prospectus required by Section 10(a)(3) of the U.S. Securities Act of 1933, as amended (the “Securities Act”);
(ii)   To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission (the “SEC”), pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii)   To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement;
Provided, however, that:
Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by or on behalf of the Registrant pursuant to Section 13 or Section 15(d) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are incorporated by reference in this Registration Statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of this Registration Statement.
(2)   That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3)   To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4)   To file a post-effective amendment to this Registration Statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Securities Act need not be furnished, provided that the Registrant includes in the prospectus, by means of a post- effective amendment, financial statements required pursuant to this paragraph and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Securities Act if such financial statements and information are contained in periodic reports filed with or furnished to the SEC by the Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference herein.
(5)   That for the purpose of determining liability under the Securities Act to any purchaser:
(i)   Each prospectus filed by the Registrant pursuant to Rule 424(b)(3) shall be deemed to be part of this Registration Statement as of the date the filed prospectus was deemed part of and included in this Registration Statement; and
(ii)   Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to
II-2
 
Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in this Registration Statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of this Registration Statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of this Registration Statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of this Registration Statement or made in any such document immediately prior to such effective date; and
(6)   That, for the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution of the securities: the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this Registration Statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i)   Any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424;
(ii)   Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred to by the undersigned Registrant;
(iii)   The portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and
(iv)   Any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser.
(b)
The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of an annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) by or on behalf of the Registrant that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
​
(c)
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, such Registrant has been advised that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
​
II-3
 
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-3 and has duly caused this Registration Statement on Form F-3 to be signed on its behalf by the undersigned, thereunto duly authorized in Hamilton, Bermuda on May 3, 2022.
​ ​ ​ ​
BROOKFIELD BUSINESS PARTNERS L.P., by its general partner, BROOKFIELD BUSINESS PARTNERS LIMITED
​
​ ​ ​ ​ By: ​ ​
/s/ Jane Sheere
​
Name: Jane Sheere
Title:   Secretary
​
Each person whose signature appears below constitutes and appoints each of Cyrus Madon, Jaspreet Dehl, James Bodi and Jane Sheere, his/her true and lawful attorney-in-fact and agent, each acting alone, with full power of substitution and resubstitution, for him/her and in his/her name, place and stead, in any and all capacities, to sign any or all amendments, including post-effective amendments and supplements to this Registration Statement and any related registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the U.S. Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, each acting alone, full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he/she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, each acting alone, or his/her substitute or substitutes, may lawfully do or cause to be done by virtue hereof. This Power of Attorney may be executed in multiple counterparts, each of which shall be deemed an original, but which taken together shall constitute one instrument.
Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed by the following persons in the capacities on May 3, 2022.
​
Signature
​ ​
Title
​
​
/s/ Cyrus Madon
​
Cyrus Madon
​ ​
Chief Executive Officer of Brookfield Private Equity L.P., a service provider to the Registrant (Principal Executive Officer)
​
​
/s/ Jaspreet Dehl
​
Jaspreet Dehl
​ ​
Chief Financial Officer of Brookfield Private Equity L.P., a service provider to the Registrant (Principal Financial and Accounting Officer)
​
​
/s/ Jeffrey Blidner
​
Jeffrey Blidner
​ ​ Director of Brookfield Business Partners Limited ​
​
/s/ Stephen Girsky
​
Stephen Girsky
​ ​ Director of Brookfield Business Partners Limited ​
​
/s/ David Hamill
​
David Hamill
​ ​ Director of Brookfield Business Partners Limited ​
​
/s/ Anne Ruth Herkes
​
Anne Ruth Herkes
​ ​ Director of Brookfield Business Partners Limited ​
II-4
 
​
Signature
​ ​
Title
​
​
/s/ John Lacey
​
John Lacey
​ ​ Director of Brookfield Business Partners Limited ​
​
/s/ Don Mackenzie
​
Don Mackenzie
​ ​ Director of Brookfield Business Partners Limited ​
​
/s/ Patricia Zuccotti
​
Patricia Zuccotti
​ ​ Director of Brookfield Business Partners Limited ​
II-5
 
AUTHORIZED U.S. REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, as amended, the undersigned has signed this Registration Statement, solely in the capacity of the duly authorized representative of Brookfield Business Partners L.P. in the United States, on this 3rd day of May, 2022.
​ ​ ​ ​ BROOKFIELD BBP US HOLDINGS LLC ​
​ ​ ​ ​ By: ​ ​
/s/ Craig Laurie
​
Name: Craig Laurie
Title:   President
​
II-6
EX-4.2 2 tm2213999d2_ex4-2.htm EXHIBIT 4.2

 

Exhibit 4.2

 

BROOKFIELD ASSET MANAGEMENT INC.

 

- and -

 

BROOKFIELD BUSINESS CORPORATION

 

- and –

 

BROOKFIELD BUSINESS PARTNERS L.P.

 

REGISTRATION RIGHTS AGREEMENT

 

March 15th, 2022

 

   
 

 

Table of Contents

 

Page
   
Article 1 INTERPRETATION 1
1.1 Definitions 1
1.2 Headings and Table of Contents 5
1.3 Interpretation 5
1.4 Invalidity of Provisions 6
1.5 Entire Agreement 6
1.6 Waiver, Amendment 7
1.7 Governing Law 7
Article 2 REGISTRATION RIGHTS 7
2.1 Demand Registration 7
2.2 Piggyback Registrations 10
2.3 Short-Form Filings 11
2.4 Registration Procedures 12
2.5 Suspension of Dispositions 17
2.6 Registration Expenses 17
2.7 Indemnification 18
2.8 Transfer of Registration Rights 21
2.9 Current Public Information 21
2.10 Preservation of Rights 21
2.11 Obligations of BBU 21
Article 3 TERMINATION 22
3.1 Termination 22
Article 4 MISCELLANEOUS 22
4.1 Enurement 22
4.2 Notices 23
4.3 Authority 24
4.4 Further Assurances 24
4.5 Counterparts 24

 

 - i - 
 

 

REGISTRATION RIGHTS AGREEMENT

 

THIS AGREEMENT made as of the 15th day of March, 2022

 

B E T W E E N:

 

BROOKFIELD ASSET MANAGEMENT INC. (“Brookfield”)

 

- and -

 

BROOKFIELD BUSINESS CORPORATION (“BBUC”)

 

-and –

 

BROOKFIELD BUSINESS PARTNERS L.P. (“BBU”)

 

RECITALS:

 

WHEREAS, BBUC desires to provide the Holders (as defined herein) with the registration rights specified in this Agreement with respect to Registrable Shares (as defined herein) on the terms and subject to the conditions set forth herein.

 

NOW THEREFORE in consideration of the premises, mutual covenants and agreements contained in this Agreement and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties covenant and agree, each with the other, as follows:

 

Article 1

 

INTERPRETATION

 

1.1Definitions

 

The following definitions shall be for all purposes, unless otherwise clearly indicated to the contrary, applied to the terms used in this Agreement.

 

1.1.1            “Adverse Effect” has the meaning assigned to such term in Section 2.1.5;

 

1.1.2            “Advice” has the meaning assigned to such term in Section 2.5;

 

1.1.3            “Affiliate” means, with respect to a Person, any other Person that, directly or indirectly, through one or more intermediaries, Controls or is Controlled by such Person, or is under common Control of a third Person;

 

1.1.4            “Agreement” means this Registration Rights Agreement;

 

   
 

 

1.1.5         “BBU” has the meaning assigned to such term in the preamble;

 

1.1.6         “BBUC” has the meaning assigned to such term in the preamble;

 

1.1.7         “Brookfield” has the meaning assigned to such term in the preamble;

 

1.1.8         “Business Day” means every day except a Saturday or Sunday, or a day which is a statutory or civic holiday in the Province of Ontario or the State of New York;

 

1.1.9         “Canadian Commissions” means the securities commissions or other securities regulatory authorities in each of the provinces and territories of Canada and any successor regulatory authorities having similar powers and, to the extent applicable, in any such province or territory, a federal securities commission or similar regulatory authority;

 

1.1.10       “Canadian Securities Laws” means, collectively, the applicable securities legislation, regulations, rules, policies, blanket rulings, decisions and orders of each of the provinces and territories of Canada and the Canadian Commissions;

 

1.1.11       “Control” means the control by one Person of another Person in accordance with the following: a Person (“A”) controls another Person (“B”) where A has the power to determine the management and policies of B by contract or status (for example, the status of A being the general partner of B) or by virtue of the beneficial ownership of or control over a majority of the voting interests in B; and, for greater certainty and without limitation, if A owns or has control over shares or other securities to which are attached more than 50% of the votes permitted to be cast in the election of directors to the Governing Body of B, or A is the general partner of B, a limited partnership, then in each case A Controls B for this purpose; and the term “Controlled” has the corresponding meaning;

 

1.1.12       “Demand Registration” has the meaning assigned to such term in Section  2.1.1(a);

 

1.1.13       “Demand Request” has the meaning assigned to such term in Section 2.1.1(a);

 

1.1.14       “Demanding Shareholders” has the meaning assigned to such term in Section 2.1.1(a);

 

1.1.15       “Effective” means, in the case of a Registration Statement, a declaration by the SEC that such registration statement is effective, and in the case of a Prospectus, the issuance by the applicable Canadian Commission of a receipt for the final prospectus;

 

1.1.16       “Effective Date” means the date a Registration Statement or Prospectus becomes Effective;

 

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1.1.17        “Excluded Registration” means a registration of (i) securities pursuant to one or more Demand Registrations pursuant to Section 2.1 hereof, (ii) securities registered under the U.S. Securities Act on Form S-8, (iii) securities registered to effect the acquisition of, or combination with, another Person and (iv) securities pursuant to an exchange offer or any employee benefit or dividend reinvestment plan;

 

1.1.18        “FINRA” means Financial Industry Regulatory Authority, Inc.;

 

1.1.19        “Governing Body” means (i) with respect to a corporation or limited company, the board of directors of such corporation or limited company, (ii) with respect to a limited liability company, the manager(s), director(s) or managing partner(s) of such limited liability company, (iii) with respect to a partnership, the board, committee or other body of each general partner or managing partner of such partnership that serves a similar function (or if any such general partner or managing partner is itself a partnership, the board, committee or other body of such general or managing partner’s general or managing partner that serves a similar function), and (iv) with respect to any other Person, the body of such Person that serves a similar function, and in the case of each of (i) through (iv) includes any committee or other subdivision of such body and any Person to whom such body has delegated any power or authority, including any officer or managing director;

 

1.1.20        “Holder” means (i) Brookfield, (ii) any subsidiary of Brookfield holding Registrable Shares, and (iii) any direct or indirect transferee of Brookfield or any of its subsidiaries who shall become a party to this Agreement in accordance with Section 2.8 and has agreed in writing to be bound by the terms of this Agreement, provided that “Holder” shall not include BBUC and its subsidiaries;

 

1.1.21        “Inspectors” has the meaning assigned to such term in Section 2.4(m);

 

1.1.22        “Person” means any natural person, partnership, limited partnership, limited liability partnership, joint venture, syndicate, sole proprietorship, company or corporation (with or without share capital), limited liability company, unlimited liability company, joint stock company, unincorporated association, trust, trustee, executor, administrator or other legal personal representative, regulatory body or agency, government or governmental agency, authority or entity however designated or constituted and pronouns have a similarly extended meaning;

 

1.1.23        “Piggyback Registration” has the meaning assigned to such term in Section 2.2.1;

 

1.1.24        “POP Issuer” means an issuer eligible to use the POP System or equivalent system established from time to time by the Canadian Commissions;

 

1.1.25        “POP System” means the prompt offering prospectus qualification system under National Instrument 44-101 of the Canadian Securities Administrators entitled “Short Form Prospectus Distributions”;

 

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1.1.26            “Prospectus” means a prospectus (including a Shelf Prospectus), including any amendment or supplement thereto, prepared in accordance with applicable Canadian Securities Laws for the purpose of qualifying securities for distribution to the public in any province or territory of Canada;

 

1.1.27            “Records” has the meaning assigned to such term in Section 2.4(m);

 

1.1.28            “register,” “registered” and “registration” refers to (i) a registration effected by preparing and filing a registration statement in compliance with the U.S. Securities Act, and the declaration or ordering of the effectiveness of such registration statement, and (ii) a qualification for distribution under Canadian Securities Laws effected by preparing and filing a Prospectus;

 

1.1.29            “Registrable Shares” means the Shares owned by Holders from time to time, including Shares issuable to Holders on the conversion of securities convertible, exchangeable or exercisable into Shares owned by a Holder, together with any securities owned by Holders issued with respect to such Shares by way of dividend or split or in connection with a combination of shares, recapitalization, merger, consolidation, amalgamation, arrangement or other reorganization; provided, however, that Shares that, pursuant to Section 3.1, no longer have registration rights hereunder shall not be considered Registrable Shares;

 

1.1.30            “Registration Statement” means a registration statement under the U.S. Securities Act (which includes any preliminary prospectus, prospectus, prospectus supplement or free writing prospectus used in connection therewith);

 

1.1.31            “Requesting Holders” shall mean any Holder(s) requesting to have its (their) Registrable Shares included in any Demand Registration or Shelf Registration;

 

1.1.32            “Required Filing Date” has the meaning assigned to such term in Section 2.1.1(b);

 

1.1.33            “SEC” means the U.S. Securities and Exchange Commission or any other federal agency at the time administering the U.S. Securities Act;

 

1.1.34            “Securities Laws” means Canadian Securities Laws and/or U.S. Securities Laws, as applicable;

 

1.1.35            “Seller Affiliates” has the meaning assigned to such term in Section 2.7.1;

 

1.1.36            “Shares” means class A exchangeable subordinate voting shares of BBUC;

 

1.1.37            “Shelf Prospectus” means a shelf prospectus of BBUC filed with the Canadian Commissions under Canadian Securities Laws for offers and secondary sales of Registrable Shares on a continuous basis;

 

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1.1.38            “Shelf Registration” means a registration of the Registrable Shares under a registration statement pursuant to Rule 415 under the U.S. Securities Act;

 

1.1.39            “Suspension Notice” has the meaning assigned to such term in Section 2.5;

 

1.1.40            “U.S. Exchange Act” means the United States Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations promulgated by the SEC thereunder;

 

1.1.41            “U.S. Securities Act” means the United States Securities Act of 1933, as amended, or any similar federal statute and the rules and regulations promulgated by the SEC thereunder; and

 

1.1.42            “U.S. Securities Laws” means, collectively, the securities laws of the United States, including the U.S. Exchange Act, the U.S. Securities Act, state securities or “blue sky” laws within the United States, and all rules, regulations and ordinances promulgated thereunder.

 

1.2Headings and Table of Contents

 

The inclusion of headings and a table of contents in this Agreement are for convenience of reference only and will not affect the construction or interpretation hereof.

 

1.3Interpretation

 

In this Agreement, unless the context otherwise requires:

 

1.3.1            words importing the singular shall include the plural and vice versa, words importing gender shall include all genders or the neuter, and words importing the neuter shall include all genders;

 

1.3.2            the words “include”, “includes”, “including”, or any variations thereof, when following any general term or statement, are not to be construed as limiting the general term or statement to the specific items or matters set forth or to similar items or matters, but rather as referring to all other items or matters that could reasonably fall within the broadest possible scope of the general term or statement;

 

1.3.3            references to any Person include such Person’s successors and permitted assigns;

 

1.3.4            except as otherwise provided in this Agreement, any reference in this Agreement to a statute, regulation, policy, rule or instrument shall include, and shall be deemed to be a reference also to, all rules and regulations made under such statute, in the case of a statute, all amendments made to such statute, regulation, policy, rule or instrument and to any statute, regulation, policy, rule or instrument that may be passed which has the effect of supplementing or superseding the statute, regulation, policy, rule or instrument so referred to;

 

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1.3.5            any reference to this Agreement or any other agreement, document or instrument shall be construed as a reference to this Agreement or, as the case may be, such other agreement, document or instrument as the same may have been, or may from time to time be, amended, varied, replaced, amended and restated, supplemented or otherwise modified;

 

1.3.6            in the event that any day on which any amount is to be determined or any action is required to be taken hereunder is not a Business Day, then such amount shall be determined or such action shall be required to be taken at or before the requisite time on the next succeeding day that is a Business Day; and

 

1.3.7            except where otherwise expressly provided, all amounts in this Agreement are stated and shall be paid in U.S. currency.

 

1.4Invalidity of Provisions

 

Each of the provisions contained in this Agreement is distinct and severable and a declaration of invalidity or unenforceability of any such provision or part thereof by a court of competent jurisdiction will not affect the validity or enforceability of any other provision hereof. To the extent permitted by applicable law, the parties waive any provision of law which renders any provision of this Agreement invalid or unenforceable in any respect. The parties will engage in good faith negotiations to replace any provision which is declared invalid or unenforceable with a valid and enforceable provision, the economic effect of which comes as close as possible to that of the invalid or unenforceable provision which it replaces.

 

1.5Entire Agreement

 

This Agreement constitutes the entire agreement between the parties pertaining to the subject matter of this Agreement. There are no warranties, conditions, or representations (including any that may be implied by statute) and there are no agreements in connection with such subject matter except as specifically set forth or referred to in this Agreement. No reliance is placed on any warranty, representation, opinion, advice or assertion of fact made either prior to, contemporaneous with, or after entering into this Agreement, or any amendment or supplement hereto, by any party to this Agreement or its directors, officers, employees or agents, to any other party to this Agreement or its directors, officers, employees or agents, except to the extent that the same has been reduced to writing and included as a term of this Agreement, and none of the parties to this Agreement has been induced to enter into this Agreement or any amendment or supplement by reason of any such warranty, representation, opinion, advice or assertion of fact. Accordingly, there will be no liability, either in tort or in contract, assessed in relation to any such warranty, representation, opinion, advice or assertion of fact, except to the extent contemplated above.

 

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1.6Waiver, Amendment

 

Except as expressly provided in this Agreement, no waiver of this Agreement will be binding unless executed in writing by the party to be bound thereby. No waiver of any provision of this Agreement will constitute a waiver of any other provision nor will any waiver of any provision of this Agreement constitute a continuing waiver unless otherwise expressly provided. A party’s failure or delay in exercising any right under this Agreement will not operate as a waiver of that right. A single or partial exercise of any right will not preclude a party from any other or further exercise of that right or the exercise of any other right. This Agreement may not be amended or modified in any respect except by a written agreement signed by BBUC, BBU and Brookfield (so long as Brookfield owns any Shares) and the Holders of a majority of the then outstanding Registrable Shares.

 

1.7Governing Law

 

This Agreement will be governed by and interpreted and enforced in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. Each party irrevocably attorns and submits to the non-exclusive jurisdiction of the Ontario courts situated in the City of Toronto and waives objection to the venue of any proceeding in such court or any argument that such court provides an inconvenient forum.

 

Article 2

 

REGISTRATION RIGHTS

 

2.1Demand Registration

 

2.1.1            Request for Registration

 

(a)Commencing on the date hereof, any Holder shall have the right to require BBUC to file a Registration Statement and/or a Prospectus for a public offering of all or part of its Registrable Shares (a “Demand Registration”), by delivering to BBUC written notice stating that such right is being exercised, naming the Holders whose Registrable Shares are to be included in such registration (collectively, the “Demanding Shareholders”), specifying the number of each such Demanding Shareholder’s Registrable Shares to be included in such registration and, subject to Section 2.1.3 hereof, describing the intended method of distribution thereof (a “Demand Request”).

 

(b)Each Demand Request shall specify the aggregate number of Registrable Shares proposed to be sold. Subject to Section 2.1.6, BBUC shall file a Registration Statement and/or Prospectus in respect of a Demand Registration as soon as practicable and, in any event, within forty-five (45) days after receiving a Demand Request (the “Required Filing Date”) and shall use reasonable best efforts to cause the same to be declared Effective as promptly as practicable after such filing; provided, however, that:

 

(i)BBUC shall not be obligated to file a Registration Statement or a Prospectus in respect of a Demand Registration pursuant to Section 2.1.1(a) within sixty (60) days after the Effective Date of a previous Demand Registration, other than a Shelf Registration pursuant to this Article 2; and

 

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(ii)BBUC shall not be obligated to file a Registration Statement or a Prospectus in respect of a Demand Registration pursuant to Section 2.1.1(a) unless the Demand Request is for (A) a number of Registrable Shares with a market value that is equal to at least $50,000,000 as of the date of such Demand Request, or (B) all of the Registrable Shares then held by the Demanding Shareholder.

 

2.1.2            Shelf Registration. With respect to any Demand Registration, the Requesting Holders may request BBUC to file a Shelf Prospectus or effect a Shelf Registration, provided that BBUC is permitted to do so under Canadian Securities Laws and/or U.S. Securities Laws, as applicable.

 

2.1.3            Selection of Underwriters. At the request of a Requesting Holder, the offering of Registrable Shares pursuant to a Demand Registration shall be in the form of a “firm commitment” underwritten offering. The Requesting Holder shall select the investment banking firm or firms to manage the underwritten offering; provided that such selection shall be subject to the consent of BBUC, which consent shall not be unreasonably withheld or delayed. No Holder may participate in any registration pursuant to Section 2.1.1 unless such Holder (a) agrees to sell such Holder’s Registrable Shares on the basis provided in any underwriting arrangements described above and (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements; provided, however, that no such Holder shall be required to make any representations or warranties in connection with any such registration other than representations and warranties as to (i) such Holder’s ownership of Registrable Shares to be transferred free and clear of all liens, claims, and encumbrances, (ii) such Holder’s power and authority to effect such transfer, and (iii) such matters pertaining to compliance with Securities Laws as may be reasonably requested; provided, further, however, that the obligation of such Holder to indemnify pursuant to any such underwriting arrangements shall be several, not joint and several, among such Holders selling Registrable Shares, and the liability of each such Holder will be in proportion thereto, and provided, further, that such liability will be limited to the net amount received by such Holder from the sale of its Registrable Shares pursuant to such registration.

 

2.1.4            Rights of Non-Requesting Holders. Upon receipt of any Demand Request, BBUC shall promptly (but in any event within ten (10) days) give written notice of such proposed Demand Registration to all other Holders, who shall have the right, exercisable by written notice to BBUC within twenty (20) days of their receipt of BBUC’s notice, to elect to include in such Demand Registration such portion of their Registrable Shares as they may request. All Holders requesting to have their Registrable Shares included in a Demand Registration in accordance with the preceding sentence and all Demanding Shareholders shall be deemed to be “Requesting Holders” for purposes of this Section 2.1. BBUC shall also have the right to issue and sell Shares in such Demand Registration, subject to Section 2.1.5.

 

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2.1.5            Priority on Demand Registrations. No securities to be sold for the account of any Person (including BBUC) other than a Requesting Holder shall be included in a Demand Registration unless the managing underwriter or underwriters shall advise the Requesting Holders in writing that the inclusion of such securities will not adversely affect the price, timing or distribution of the offering or otherwise adversely affect its success (an “Adverse Effect”). Furthermore, if the managing underwriter or underwriters shall advise the Requesting Holders that, even after exclusion of all securities of other Persons (including BBUC) pursuant to the immediately preceding sentence, the amount of Registrable Shares proposed to be included in such Demand Registration by Requesting Holders is sufficiently large to cause an Adverse Effect, the Registrable Shares of the Requesting Holders to be included in such Demand Registration shall equal the number of Registrable Shares which the Requesting Holders are so advised can be sold in such offering without an Adverse Effect and such Registrable Shares shall be allocated pro rata among the Requesting Holders on the basis of the number of Registrable Shares requested to be included in such registration by each such Requesting Holder.

 

2.1.6            Deferral of Filing. BBUC may defer the filing (but not the preparation) of a Registration Statement or Prospectus, as applicable, required by Section 2.1 until a date not later than ninety (90) days after the Required Filing Date if (a) at the time BBUC receives the Demand Request, BBUC is engaged in confidential negotiations or other confidential activities, disclosure of which would be required in such Registration Statement or Prospectus, as applicable (but would not be required if such Registration Statement or Prospectus, as applicable, were not filed), and the Board of Directors of BBUC determines in good faith that such disclosure would be materially detrimental to BBUC and its shareholders, (b) prior to receiving the Demand Request, BBUC had determined to effect a registered underwritten public offering of BBUC’s securities for BBUC’s account and BBUC has taken substantial steps (including, but not limited to, selecting a managing underwriter for such offering) and is proceeding with reasonable diligence to effect such offering, or (c) at the time BBUC receives the Demand Request, BBUC is currently engaged in a self-tender or exchange offer and the filing of a Registration Statement or Prospectus, as applicable, would cause a violation of applicable Securities Laws. A deferral of the filing of a Registration Statement or Prospectus, as applicable, pursuant to this Section 2.1.6 shall be lifted, and the requested Registration Statement or Prospectus, as applicable, shall be filed forthwith, if, in the case of a deferral pursuant to clause (a) of the preceding sentence, the negotiations or other activities are disclosed, otherwise become publicly known, or are terminated, or, in the case of a deferral pursuant to clause (b) of the preceding sentence, the proposed registration for BBUC’s account is abandoned. In order to defer the filing of a Registration Statement or Prospectus, as applicable, pursuant to this Section 2.1.6, BBUC shall promptly (but in any event within ten (10) days), upon determining to seek such deferral, deliver to the Requesting Holders a certificate signed by an officer of BBUC or the Board of Directors of BBUC stating that BBUC is deferring such filing pursuant to this Section 2.1.6 and a general statement of the reason for such deferral and an approximation of the anticipated delay. Within twenty (20) days after receiving such certificate, the Requesting Holder may withdraw such Demand Request by giving notice to BBUC; if withdrawn, the Demand Request shall be deemed not to have been made for all purposes of this Agreement. BBUC may defer the filing of a particular Registration Statement or Prospectus, as applicable, pursuant to this Section 2.1.6 only once.

 

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2.2Piggyback Registrations

 

2.2.1            Right to Piggyback. Each time BBUC proposes to (a) register any of its equity securities (other than pursuant to an Excluded Registration) under Canadian Securities Laws or U.S. Securities Laws for sale to the public (whether for the account of BBUC or the account of any securityholder of BBUC or (b) sell any of its equity securities (other than pursuant to an Excluded Registration) and with respect to which a Shelf Registration or Shelf Prospectus is expressly being utilized to effect such sale, (clause (a) and (b) are each referred to as a “Piggyback Registration”), BBUC shall give prompt written notice to each Holder of Registrable Shares, which notice shall offer each such Holder the opportunity to include any or all of its Registrable Shares in such Registration Statement, Shelf Registration or Prospectus, as applicable, subject to the limitations contained in Section 2.2.2 hereof. Each Holder who desires to have its Registrable Shares included in such Registration Statement, Shelf Registration or Prospectus, as applicable, shall so advise BBUC in writing (stating the number of Registrable Shares desired to be registered) within three (3) days after the date of such notice from BBUC (or within one (1) Business Day in the case of a “bought deal” financing). Any Holder shall have the right to withdraw such Holder’s request for inclusion of such Holder’s Registrable Shares in any Registration Statement, Shelf Registration or Prospectus, as applicable, pursuant to this Section 2.2.1 by giving written notice to BBUC of such withdrawal provided, however, that such request is made prior to the execution of an underwriting agreement (or similar agreement) with respect to such offering. Subject to Section 2.2.2 below, BBUC shall include in such Registration Statement, Shelf Registration or Prospectus, as applicable, all such Registrable Shares so requested to be included therein; provided, however, that BBUC may at any time withdraw or cease proceeding with any such registration or sale if it shall at the same time withdraw or cease proceeding with the registration or sale of all other equity securities originally proposed to be registered or sold. Each Holder shall protect and maintain the confidentiality of all information communicated to it by BBUC concerning a proposed Piggyback Registration pursuant to this Section 2.2.1 until such information becomes available in the public domain.

 

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2.2.2            Priority on Piggyback Registrations

 

(a)If a Piggyback Registration is an underwritten offering, and if the managing underwriter advises BBUC that the inclusion of Registrable Shares requested to be included in a Registration Statement, Shelf Registration or Prospectus, as applicable, would cause an Adverse Effect, BBUC shall only be required to include such number of Registrable Shares in such Registration Statement, Shelf Registration or Prospectus, as applicable, as such underwriter advises in writing would not cause an Adverse Effect, with priority given as follows: (i) first, the securities BBUC proposes to sell, (ii) second, the Registrable Shares requested to be included in such Registration Statement, Shelf Registration or Prospectus, pro rata among the Holders of such Registrable Shares on the basis of the number of Registrable Shares owned by each such Holder, and (iii) third, any other securities requested to be included in such Registration Statement, Shelf Registration or Prospectus. If as a result of the provisions of this Section 2.2.2(a) any Holder shall not be entitled to include all Registrable Shares in a Registration Statement, Shelf Registration or Prospectus that such Holder has requested to be so included, such Holder may withdraw such Holder’s request to include Registrable Shares in such Registration Statement, Shelf Registration or Prospectus, as applicable.

 

(b)No Holder may participate in any Registration Statement, Shelf Registration or Prospectus, as applicable, in respect of a Piggyback Registration hereunder unless such Holder (i) agrees to sell such Holder’s Registrable Shares on the basis provided in any underwriting arrangements approved by BBUC and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents, each in customary form, reasonably required under the terms of such underwriting arrangements; provided, however, that no such Holder shall be required to make any representations or warranties in connection with any such registration other than representations and warranties as to (A) such Holder’s ownership of Registrable Shares to be sold or transferred free and clear of all liens, claims, and encumbrances, (B) such Holder’s power and authority to effect such transfer, and (C) such matters pertaining to compliance with applicable Securities Laws as may be reasonably requested; provided, further, however, that the obligation of such Holder to indemnify pursuant to any such underwriting arrangements shall be several, not joint and several, among such Holders selling Registrable Shares, and the liability of each such Holder will be in proportion thereto, and provided, further, that such liability will be limited to the net amount received by such Holder from the sale of its Registrable Shares pursuant to such Registration Statement, Shelf Registration or Prospectus.

 

2.3Short-Form Filings

 

(a)Shelf Registration Statement. BBUC shall use its reasonable best efforts to cause Demand Registrations in the United States to be registered on a shelf registration statement on an appropriate form (including, but not limited to, Form F-10, Form F-3 or Form S-3, as may be applicable, or their successor forms, but excluding Form S-8, Form S-4 or Form F-4, or their successor forms, or any other form for a similar purpose) once BBUC becomes eligible to use any such form, and BBUC shall use its reasonable best efforts to remain so eligible to use any such form.

 

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(b)Short-Form Prospectus. BBUC shall use its reasonable best efforts to cause Demand Registrations in Canada to be qualified by way of a short-form Prospectus prepared pursuant to the POP System if, at the time of such Demand Registration, BBUC is a POP Issuer and is able to do so in all of the provinces and territories in which the Demand Registration is to be effected. For greater certainty, it is acknowledged that in the event that BBUC is not a POP Issuer or is unable to utilize the POP System in one or more Canadian provinces or territories in which the Demand Registration is to be effected, BBUC shall proceed by way of long-form Prospectus.

 

2.4Registration Procedures

 

Whenever any Holder has requested that any Registrable Shares be registered pursuant to this Agreement, BBUC will use its reasonable best efforts to effect the registration and the sale of such Registrable Shares in accordance with the intended method of disposition thereof as promptly as is practicable, and pursuant thereto BBUC will as expeditiously as possible:

 

(a)prepare and file, pursuant to Section 2.1.1(b) with respect to any Demand Registration, subject to Section 2.3, a Registration Statement or Prospectus, as applicable, with respect to such Registrable Shares and use its reasonable best efforts to cause such Registration Statement or Prospectus, as applicable, to become Effective; provided that as far in advance as practicable before filing such Registration Statement or Prospectus, as applicable, or any amendment or supplement thereto, BBUC will furnish to the selling Holders copies of reasonably complete drafts of all such documents prepared to be filed (including exhibits), and any such Holder shall have the opportunity to object to any information contained therein and BBUC will make corrections reasonably requested by such Holder with respect to such information prior to filing any such Registration Statement or Prospectus, as applicable, or any amendment or supplement thereto;

 

(b)except in the case of a Shelf Registration or Shelf Prospectus, prepare and file with the SEC or the applicable Canadian Commissions, such amendments, post-effective amendments and supplements to such Registration Statement or Prospectus, as applicable, as may be necessary to keep such Registration Statement or Prospectus, as applicable, effective for a period of not less than one hundred eighty (180) days (or such lesser period as is necessary for the underwriters in an underwritten offering to sell unsold allotments) and comply with the provisions of the applicable Securities Laws with respect to the disposition of all securities covered by such Registration Statement or Prospectus, as applicable, during such period in accordance with the intended methods of disposition by the sellers thereof set forth in such Registration Statement or Prospectus, as applicable;

 

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(c)in the case of a Shelf Registration or Shelf Prospectus, prepare and file with the SEC or the applicable Canadian Commissions, as applicable, such amendments and supplements to such Shelf Registration or Shelf Prospectus, as applicable, as may be necessary to keep such Shelf Registration or Shelf Prospectus, as applicable, effective and to comply with the provisions of the applicable Securities Laws with respect to the disposition of all Registrable Shares subject thereto for a period ending on the earlier of (i) twenty four (24) months after the Effective Date and (ii) the date on which all the Registrable Shares subject thereto have been sold pursuant to such Shelf Registration or Shelf Prospectus, as applicable;

 

(d)furnish to each seller of Registrable Shares and the underwriters of the securities being registered such number of copies of such Registration Statement, Shelf Registration or Prospectus, as applicable (in the English language and, if required, the French language), each amendment and supplement thereto, any documents incorporated by reference therein and such other documents as such seller or underwriters may reasonably request in order to facilitate the disposition of the Registrable Shares owned by such seller or the sale of such securities by such underwriters (it being understood that, subject to Section 2.5 and the requirements of the applicable Securities Laws, BBUC consents to the use of the Registration Statement, Shelf Registration and Prospectus, as applicable, and any amendment or supplement thereto by each seller and the underwriters in connection with the offering and sale of the Registrable Shares covered by the Registration Statement, Shelf Registration or Prospectus, as applicable);

 

(e)use its reasonable best efforts to register or qualify such Registrable Shares under such other securities or “blue sky” laws of such jurisdictions as the managing underwriter reasonably requests (or, in the event the Registration Statement, Shelf Registration or Prospectus, as applicable, does not relate to an underwritten offering, as the holders of a majority of such Registrable Shares may reasonably request); use its reasonable best efforts to keep each such registration or qualification (or exemption therefrom) effective during the period in which such Registration Statement, Shelf Registration or Prospectus, as applicable, is required to be kept effective; and do any and all other acts and things which may be reasonably necessary or advisable to enable each seller to consummate the disposition of the Registrable Shares owned by such seller in such jurisdictions (provided, however, that BBUC will not be required to (i) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph, (ii) subject itself to taxation in any such jurisdiction, or (iii) consent to general service of process in any such jurisdiction);

 

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(f)notify each seller of Registrable Shares and each underwriter and (if requested by any such Person) confirm such notice in writing (i) when any supplement or amendment to the Registration Statement, Shelf Registration or Prospectus, as applicable, has been filed following the Effective Date, and when the same has become effective, (ii) of the issuance by any state securities or other regulatory authority of any order suspending the qualification or exemption from qualification of any of the Registrable Shares under state securities or “blue sky” laws or the initiation of any proceedings for that purpose, and (iii) of the happening of any event which makes any statement made in the Registration Statement, Shelf Registration or Prospectus, as applicable, untrue or which requires the making of any changes in such Registration Statement, Shelf Registration or Prospectus, as applicable, or documents so that they will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and, as promptly as practicable thereafter, prepare and file with the SEC and the applicable Canadian Commissions (as applicable) and furnish a supplement or amendment to such Registration Statement, Shelf Registration or Prospectus, as applicable, so that, as thereafter deliverable to the purchasers of such Registrable Shares, such Registration Statement, Shelf Registration or Prospectus, as applicable, will not contain any untrue statement of a material fact or omit a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;

 

(g)permit any selling Holder, which in such Holder’s sole and exclusive judgment, might reasonably be deemed to be an underwriter or a controlling person of BBUC, to participate in the preparation of such Registration Statement, Shelf Registration or Prospectus, as applicable, and to require the insertion therein of material, furnished to BBUC in writing, which in the reasonable judgment of such Holder and its counsel should be included;

 

(h)make reasonably available personnel, as selected by the Holders of a majority of the Registrable Shares included in such registration, for assistance in the selling effort relating to the Registrable Shares covered by such registration, including, but not limited to, the participation of such members of BBUC’s management in road show presentations;

 

(i)otherwise use its reasonable best efforts to comply with all applicable Securities Laws, and make generally available to BBUC’s securityholders an earnings statement satisfying the provisions of Section 11(a) of the U.S. Securities Act no later than thirty (30) days after the end of the twelve (12) month period beginning with the first day of BBUC’s first fiscal quarter commencing after the Effective Date, which earnings statement shall cover said twelve (12) month period, and which requirement will be deemed to be satisfied if BBUC timely files complete and accurate information on Forms 20-F and 6-K under the Exchange Act which otherwise complies with Rule 158 under the U.S. Securities Act;

 

(j)if requested by the managing underwriter or any seller of Registrable Shares, promptly incorporate in a prospectus supplement or post-effective amendment such information as the managing underwriter or any seller reasonably requests to be included therein, including, without limitation, with respect to the Registrable Shares being sold by such seller, the purchase price being paid therefor by the underwriters and with respect to any other terms of the underwritten offering of the Registrable Shares to be sold in such offering, and promptly make all required filings of such prospectus supplement or post-effective amendment;

 

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(k)after filing of any document which is incorporated by reference into the Registration Statement or Prospectus, as applicable (in the form in which it was incorporated), deliver a copy of each such document to each seller of Registrable Shares;

 

(l)cooperate with the sellers of Registrable Shares and the managing underwriter to facilitate the timely preparation and delivery of certificates (which shall not bear any restrictive legends unless required under applicable law) representing securities sold under any Registration Statement or Prospectus, as applicable, and enable such securities to be in such denominations and registered in such names as the managing underwriter or such sellers may request and keep available and make available to BBUC’s transfer agent prior to the Effective Date a supply of such certificates;

 

(m)make available for inspection by any seller of Registrable Shares, any underwriter participating in any disposition pursuant to any Registration Statement or Prospectus, as applicable, and any attorney, accountant or other agent or representative retained by any such seller or underwriter (collectively, the “Inspectors”), all financial and other records, pertinent corporate documents and properties of BBUC (collectively, the “Records”), as shall be reasonably necessary to enable them to exercise their due diligence responsibility, and cause BBUC’s officers, directors and employees to supply all information requested by any such Inspector in connection with such Registration Statement or Prospectus, as applicable; provided, however, that, unless the disclosure of such Records is necessary to avoid or correct a misstatement or omission in the Registration Statement or Prospectus, as applicable, or the release of such Records is ordered pursuant to a subpoena or other order from a court of competent jurisdiction, BBUC shall not be required to provide any information under this subparagraph (m) if (i) BBUC believes, after consultation with counsel for BBUC, that to do so would cause BBUC to forfeit an attorney-client privilege that was applicable to such information or (ii) if either (x) BBUC has requested and been granted from the SEC or a Canadian Commission confidential treatment of such information contained in any filing with the SEC or a Canadian Commission or documents provided supplementally or otherwise or (y) BBUC reasonably determines in good faith that such Records are confidential and so notifies the Inspectors in writing, unless prior to furnishing any such information with respect to clause (ii) such Holder of Registrable Shares requesting such information agrees to enter into a confidentiality agreement in customary form and subject to customary exceptions; and provided, further, that each Holder of Registrable Shares agrees that it will, upon learning that disclosure of such Records is sought in a court of competent jurisdiction, give notice to BBUC and allow BBUC, at its expense, to undertake appropriate action and to prevent disclosure of the Records deemed confidential;

 

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(n)furnish to each seller of Registrable Shares and underwriter a signed counterpart of (i) an opinion or opinions of counsel to BBUC, (ii) a comfort letter or comfort letters from BBUC’s independent auditors, addressed to the underwriters, each in customary form and covering such matters of the type customarily covered by opinions or comfort letters, as the case may be, as the managing underwriter reasonably requests, and (iii) if a Prospectus is filed in Quebec, opinions of Quebec counsel to BBUC and the auditors of BBUC addressed to the Holder and the underwriter or underwriters of such distribution relating to the translation of the Prospectus;

 

(o)cause the Registrable Shares included in any Prospectus or Registration Statement, as applicable, to be listed on the Toronto Stock Exchange and on the New York Stock Exchange;

 

(p)provide and cause to be maintained a transfer agent and registrar for all Registrable Shares registered hereunder;

 

(q)cooperate with each seller of Registrable Shares and each underwriter participating in the disposition of such Registrable Shares and their respective counsel in connection with any filings required to be made with FINRA;

 

(r)during the period when the Registration Statement or Prospectus, as applicable, is required to be delivered under the applicable Securities Laws, promptly file all documents required to be filed with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act or with the Canadian Commissions pursuant to Canadian Securities Laws;

 

(s)notify each seller of Registrable Shares promptly of any request by the SEC or a Canadian Commission for the amending or supplementing of such Registration Statement or Prospectus, as applicable, or for additional information;

 

(t)enter into such agreements (including underwriting agreements in the managing underwriter’s customary form) as are customary in connection with an underwritten registration; and

 

(u)advise each seller of such Registrable Shares, promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order or ruling by the SEC or a Canadian Commission suspending the effectiveness of such Registration Statement or Prospectus, as applicable, or the initiation or threatening of any proceeding for such purpose and promptly use its reasonable best efforts to prevent the issuance of any stop order or to obtain its withdrawal at the earliest possible moment if such stop order should be issued.

 

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2.5Suspension of Dispositions

 

Each Holder agrees by acquisition of any Registrable Shares that, upon receipt of any notice (a “Suspension Notice”) from BBUC of the happening of any event of the kind described in Section 2.4(f)(iii) such Holder will forthwith discontinue disposition of Registrable Shares until such Holder’s receipt of the copies of the supplemented or amended Registration Statement or Prospectus, as applicable, or until it is advised in writing (the “Advice”) by BBUC that the use of the Registration Statement or Prospectus, as applicable, may be resumed, and has received copies of any additional or supplemental filings which are incorporated by reference in the Registration Statement or Prospectus, as applicable, and, if so directed by BBUC, such Holder will deliver to BBUC all copies, other than permanent file copies then in such Holder’s possession, of the Registration Statement or Prospectus, as applicable, covering such Registrable Shares current at the time of receipt of such notice. In the event BBUC shall give any such notice, the time period regarding the effectiveness of Registration Statements or Prospectuses, as applicable, set forth in Sections 2.4(b) and 2.4(c) hereof shall be extended by the number of days during the period from and including the date of the giving of the Suspension Notice to and including the date when each seller of Registrable Shares covered by such Registration Statement or Prospectus, as applicable, shall have received the copies of the supplemented or amended Registration Statement or Prospectus, as applicable, or the Advice. BBUC shall use its reasonable best efforts and take such actions as are reasonably necessary to render the Advice as promptly as practicable.

 

2.6Registration Expenses

 

All fees and expenses incident to any registration including, without limitation, BBUC’s performance of or compliance with this Article 2, all registration and filing fees, all fees and expenses associated with filings required to be made with FINRA (including, if applicable, the reasonable fees and expenses of any “qualified independent underwriter” and of its counsel), as may be required by the rules and regulations of FINRA, fees and expenses of compliance with securities or “blue sky” laws (including reasonable fees and disbursements of counsel in connection with “blue sky” qualifications of the Registrable Shares), rating agency fees, printing expenses (including expenses of printing certificates for the Registrable Shares and of printing prospectuses), messenger and delivery expenses, the fees and expenses incurred in connection with any listing or quotation of the Registrable Shares, fees and expenses of counsel for BBUC and its independent auditors (including the expenses of any special audit or “cold comfort” letters required by or incident to such performance), the fees and expenses of any special experts retained by BBUC in connection with such registration, and the fees and expenses of other persons retained by BBUC, will be borne by BBUC (unless paid by a security holder that is not a Holder for whose account the registration is being effected) whether or not any Registration Statement or Prospectus becomes Effective; provided, however, that any underwriting discounts, commissions, or fees attributable to the sale of the Registrable Shares will be borne by the Holders pro rata on the basis of the number of Shares so registered and the fees and expenses of any counsel, accountants, or other persons retained or employed by any Holder will be borne by such Holder.

 

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2.7Indemnification

 

2.7.1            BBUC agrees to indemnify and reimburse, to the fullest extent permitted by law, each seller of Registrable Shares, and each of its employees, advisors, agents, representatives, partners, officers, and directors and each Person who Controls such seller and any agent or investment advisor thereof (collectively, the “Seller Affiliates”) (a) against any and all losses, claims, damages, liabilities, and expenses, joint or several (including, without limitation, reasonable attorneys’ fees and disbursements except as limited by Section 2.7.3) based upon, arising out of, related to or resulting from any untrue or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus or any amendment thereof or supplement thereto, or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, (b) against any and all loss, liability, claim, damage, and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation or investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon, arising out of, related to or resulting from any such untrue statement or omission or alleged untrue statement or omission, and (c) against any and all costs and expenses (including reasonable fees and disbursements of counsel) as may be reasonably incurred in investigating, preparing, or defending against any litigation, or investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon, arising out of, related to or resulting from any such untrue statement or omission or alleged untrue statement or omission, or violation of the Securities Laws, to the extent that any such expense or cost is not paid under subparagraph (a) or (b) above; except insofar as any such statements are made in reliance upon and in strict conformity with information furnished in writing to BBUC by such seller or any Seller Affiliate for use therein or arise from such seller’s or any Seller Affiliate’s failure to deliver a copy of the Registration Statement or Prospectus or any amendments or supplements thereto after BBUC has furnished such seller or Seller Affiliate with a sufficient number of copies of the same. The reimbursements required by this Section 2.7.1 will be made by periodic payments during the course of the investigation or defense, as and when bills are received or expenses incurred.

 

2.7.2            In connection with any Registration Statement or Prospectus in which a seller of Registrable Shares is participating, each such seller will furnish to BBUC and/or BBU in writing such information and affidavits as BBUC and/or BBU reasonably requests for use in connection with any such Registration Statement or Prospectus, as applicable, and, to the fullest extent permitted by law, each such seller will indemnify BBUC, BBU and each of their respective employees, advisors, agents, representatives, partners, officers and directors and each Person who Controls BBUC or BBU, as applicable (excluding such seller or any Seller Affiliate) and any agent or investment advisor thereof against any and all losses, claims, damages, liabilities, and expenses (including, without limitation, reasonable attorneys’ fees and disbursements except as limited by Section 2.7.3) resulting from any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or Prospectus, as applicable, or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or alleged untrue statement or omission or alleged omission is contained in any information or affidavit so furnished in writing by such seller or any of its Seller Affiliates specifically for inclusion in the Registration Statement or Prospectus, as applicable; provided that the obligation to indemnify will be several, not joint and several, among such sellers of Registrable Shares, and the liability of each such seller of Registrable Shares will be in proportion to, and will be limited to, the net amount received by such seller from the sale of Registrable Shares pursuant to such Registration Statement or Prospectus, as applicable; provided, however, that such seller of Registrable Shares shall not be liable in any such case to the extent that prior to the filing of any such Registration Statement or Prospectus, as applicable, or amendment thereof or supplement thereto, such seller has furnished in writing to BBUC and/or BBU information expressly for use in such Registration Statement or Prospectus, as applicable, or any amendment thereof or supplement thereto which corrected or made not misleading information previously furnished to BBUC and/or BBU.

 

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2.7.3            Any Person entitled to indemnification hereunder will (a) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that the failure to give such notice shall not limit the rights of such Person) and (b) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party; provided, however, that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such person unless (i) the indemnifying party has agreed to pay such fees or expenses, (ii) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person, or (iii) such counsel has been retained due to a conflict as described below. If such defense is not assumed by the indemnifying party as permitted hereunder, the indemnifying party will not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent will not be unreasonably withheld or delayed). If such defense is assumed by the indemnifying party pursuant to the provisions hereof, such indemnifying party shall not settle or otherwise compromise the applicable claim unless (A) such settlement or compromise contains a full and unconditional release of the indemnified party without any admission of liability on the part of such indemnified party or (B) the indemnified party otherwise consents in writing. An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim (together with appropriate local counsel), unless in the reasonable judgment of any indemnified party, a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim, in which event the indemnifying party shall be obligated to pay the reasonable fees and disbursements of such additional counsel or counsels.

 

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2.7.4            Each party hereto agrees that, if for any reason the indemnification provisions contemplated by Section 2.7.1 or Section 2.7.2 are unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities, or expenses (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, liabilities, or expenses (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party in connection with the actions which resulted in the losses, claims, damages, liabilities or expenses as well as any other relevant equitable considerations. The relative fault of such indemnifying party and indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or indemnified party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 2.7.4 were determined by pro rata allocation (even if the Holders or any underwriters or all of them were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in this Section 2.7.4. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities, or expenses (or actions in respect thereof) referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such indemnified party in connection with investigating or, except as provided in Section 2.7.3, defending any such action or claim. Notwithstanding the provisions of this Section 2.7.4, no Holder shall be required to contribute an amount greater than the dollar amount by which the net proceeds received by such Holder with respect to the sale of any Registrable Shares exceeds the amount of damages which such Holder has otherwise been required to pay by reason of any and all untrue or alleged untrue statements of material fact or omissions or alleged omissions of material fact made in any Registration Statement or Prospectus, as applicable, or any amendment thereof or supplement thereto related to such sale of Registrable Shares. No person guilty of fraudulent misrepresentation shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations in this Section 2.7.4 to contribute shall be several in proportion to the amount of Registrable Shares registered by them and not joint.

 

2.7.5            If indemnification is available under this Section 2.7, the indemnifying parties shall indemnify each indemnified party to the full extent provided in Section 2.7.1 and Section 2.7.2 without regard to the relative fault of said indemnifying party or indemnified party or any other equitable consideration provided for in Section 2.7.4 subject, in the case of the Holders, to the limited dollar amounts set forth in Section 2.7.2.

 

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2.7.6            The indemnification and contribution provided for under this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director, or controlling Person of such indemnified party and will survive the transfer of securities.

 

2.8Transfer of Registration Rights

 

The rights of each Holder under this Agreement may, in the Holder’s discretion, be assigned, in whole or in part, to any direct or indirect transferee of all or any portion of such Holder’s Registrable Shares who agrees in writing to be subject to and bound by all the terms and conditions of this Agreement. For greater certainty, in the case of a transfer of less than all of such Holder’s Registrable Shares, no such assignment will limit or otherwise impair the transferor’s rights under this Agreement.

 

2.9Current Public Information

 

BBUC will file the reports required to be filed by it under applicable Securities Laws (or, if BBUC is not required to file such reports, will, upon the request of the Holders, make publicly available other information) and will take such further action as any of the Holders may reasonably request, all to the extent required from time to time to enable the Holders to sell Registrable Securities without registration under, and subject to the limitations of, applicable Securities Laws. Upon the reasonable request of any Holder, BBUC will deliver to such parties a written statement as to whether it has complied with such requirements and will, at its expense, forthwith upon the request of any such Holder, deliver to such Holder a certificate, signed by an officer, stating (a) BBUC’s name, address and telephone number (including area code), (b) BBUC’s Internal Revenue Service identification number and Business Number issued by the Canada Revenue Agency, (c) BBUC’s SEC and SEDAR file numbers, (d) the number of Shares outstanding as shown by the most recent report or statement published by BBUC, and (e) whether BBUC has filed the reports required to be filed under the applicable Securities Laws for a period or at least ninety (90) days prior to the date of such certificate and in addition has filed the most recent annual report required to be filed thereunder.

 

2.10Preservation of Rights

 

BBUC will not directly or indirectly (a) grant any registration rights to third parties which are more favorable than or inconsistent with the rights granted hereunder or (b) enter into any agreement, take any action, or permit any change to occur, with respect to its securities that violates or subordinates the rights expressly granted to the Holders in this Agreement.

 

2.11Obligations of BBU

 

Whenever any Holder has requested that any Registrable Shares be registered in accordance with the terms of this Agreement, BBU shall (i) cooperate with BBUC to satisfy BBUC’s obligations pursuant to this Agreement and participate in the preparation, as necessary, of a Registration Statement and/or Prospectus by BBUC and (ii) take any and all such actions as may be required under this Agreement and/or applicable Securities Laws to register the underlying limited partnership units of BBU that may be issued upon an exchange, redemption or purchase of Shares, or as a result of the liquidation, dissolution or winding up of BBUC or BBU. The provisions of the registration rights agreement between BBU and Brookfield dated June 1, 2016 (as amended, the “BBU-Brookfield Registration Rights Agreement”), other than sections 2.1.1(b)(i) and 2.1.1(b)(ii) thereof, shall apply to the registration of any underlying limited partnership units of BBU that may be delivered by Brookfield to a holder of Shares upon an exchange of Shares, mutatis mutandis, and the preparation of a Registration Statement and/or Prospectus by BBU in connection therewith shall be deemed to be a “Demand Registration” under the BBU-Brookfield Registration Rights Agreement without the need for Brookfield to take any further action thereunder.

 

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Article 3

 

TERMINATION

 

3.1Termination

 

The Holders may exercise the registration rights granted hereunder in such manner and proportions as they shall agree among themselves. The registration rights hereunder shall cease to apply to any particular Registrable Shares when: (a) a Registration Statement or Prospectus, as applicable, with respect to the sale of such Shares (or other securities) shall have become Effective and such Shares shall have been disposed of in accordance with such Registration Statement or Prospectus, as applicable; (b) such Shares (or other securities) shall have been sold to the public pursuant to an exemption under applicable Securities Laws; (c) such Shares (or other securities) shall have been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered by BBUC and subsequent public distribution of them shall not require registration under applicable Securities Laws; (d) such Shares (or other securities) shall have ceased to be outstanding; or (e) such Registrable Shares are eligible for sale pursuant to Rule 144(b)(1) (without the requirement for BBUC to be in compliance with the current public information required under Rule 144) under the U.S. Securities Act. BBUC shall promptly upon the request of any Holder furnish to such Holder evidence of the number of Registrable Shares then outstanding.

 

Article 4

 

MISCELLANEOUS

 

4.1Enurement

 

This Agreement will enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

 

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4.2Notices

 

Any notice or other communication required or permitted to be given hereunder will be in writing and will be given by prepaid first-class mail, by facsimile or other means of electronic communication, including e-mail, or by hand-delivery as hereinafter provided. Any such notice or other communication, if mailed by prepaid first-class mail at any time other than during a general discontinuance of postal service due to strike, lockout or otherwise, will be deemed to have been received on the fourth Business Day after the post-marked date thereof, or if sent by facsimile or other means of electronic communication, will be deemed to have been received on the Business Day following the sending, or if delivered by hand will be deemed to have been received at the time it is delivered to the applicable address noted below either to the individual designated below or to an individual at such address having apparent authority to accept deliveries on behalf of the addressee. Notice of change of address will also be governed by this section. In the event of a general discontinuance of postal service due to strike, lock-out or otherwise, notices or other communications will be delivered by hand or sent by facsimile or other means of electronic communication and will be deemed to have been received in accordance with this section. Notices and other communications will be addressed as follows:

 

4.2.1       if to Brookfield:

 

Brookfield Asset Management Inc.

Brookfield Place, 181 Bay Street

Suite 300, P.O. Box 762

Toronto, Ontario M5J 2T3

 

Attention:      Chief Legal Officer

 

4.2.2       if to BBUC:

 

Brookfield Business Corporation

250 Vesey Street, 15th Floor
New York, NY 10281-1023

 

Attention:      Chief Financial Officer

 

4.2.3       if to BBU:

 

Brookfield Business Partners L.P.

73 Front Street, 5th Floor
Hamilton HM12, Bermuda

 

Attention:      Chief Financial Officer

 

or to such other addresses as a party may from time to time notify the other in accordance with this Section 4.2.

 

If to any other Holder, the address indicated for such Holder in BBUC’s stock transfer records with copies, so long as Brookfield owns any Registrable Shares, to Brookfield as provided above.

 

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4.3Authority

 

Each of the parties hereto represents to the other that (a) it has the corporate power and authority to execute, deliver and perform this Agreement, (b) the execution, delivery and performance of this Agreement by it has been duly authorized by all necessary corporate action and no such further action is required, (c) it has duly and validly executed and delivered this Agreement, and (d) this Agreement is a legal, valid and binding obligation, enforceable against it in accordance with its terms subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally and general equity principles.

 

4.4Further Assurances

 

Each of the parties hereto will promptly do, make, execute or deliver, or cause to be done, made, executed or delivered, all such further acts, documents and things as the other party hereto may reasonably require from time to time for the purpose of giving effect to this Agreement and will use commercially reasonable efforts and take all such steps as may be reasonably within its power to implement to their full extent the provisions of this Agreement.

 

4.5Counterparts

 

This Agreement may be signed in counterparts and each of such counterparts will constitute an original document and such counterparts, taken together, will constitute one and the same instrument.

 

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IN WITNESS WHEREOF the parties have executed this Agreement as of the day and year first above written.

 

  BROOKFIELD ASSET MANAGEMENT INC.
   
  By: /s/ Kathy Sarpash
    Name: Kathy Sarpash
Title: Senior Vice President

 

  Brookfield BUSINESS CORPORATION
   
  By: /s/ A.J. Silber
    Name: A.J. Silber
Title: Director

 

  Brookfield BUSINESS PARTNERS L.P., by its general partner, BROOKfield BUSINESS L.P., by its general partner, BROOKFIELD BUSINESS PARTNERS LIMITED
   
  By: /s/ James Bodi
    Name: James Bodi
Title: Vice President

 

 25 

 

 EX-5.1 3 tm2213999d2_ex5-1.htm EXHIBIT 5.1

 

Exhibit 5.1

 

 

 

Brookfield Business Partners L.P.

73 Front Street

Hamilton Bermuda

HM 11

Email      CLangley@applebyglobal.com

 

Direct Dial       +1 441 298 3202

 

Appleby Ref    433310.0026/CL/MB/AK

 

3 May 2022

 

Ladies and Gentlemen

 

 

Bermuda Office

Appleby (Bermuda)

Limited

Canon's Court

22 Victoria Street

PO Box HM 1179

Hamilton HM EX

Bermuda

 

Tel +1 441 295 2244

Fax +1 441 292 8666

 

applebyglobal.com

 

 

 

 

 

 

 

Appleby (Bermuda) Limited (the Legal

Practice) is a limited liability company

incorporated in Bermuda and

approved and recognised under the

Bermuda Bar (Professional

Companies) Rules 2009. "Partner" is

a title referring to a director,

shareholder or an employee of the

Legal Practice. A list of such persons

can be obtained from your

relationship partner. 

  

Brookfield Business Partners L.P.

 

We have acted as legal advisers as to matters of Bermuda law to Brookfield Business Partners L.P., an exempted limited partnership organized under the laws of the Islands of Bermuda (Partnership). We have been requested to render this opinion in connection with the following:

 

1.    a registration statement on Form F-3 (as may be amended, the Registration Statement) filed with the Securities and Exchange Commission (SEC) on or about the date hereof pursuant to the U.S. Securities Act of 1933, as amended (Securities Act), relating to the issuance by the Partnership or the delivery by Brookfield Asset Management Inc. (BAM) or Brookfield Business Corporation (BBUC) from time to time of the Partnership’s non-voting limited partnership units (Units), in each case, in connection with the exchange, redemption or acquisition, as applicable, from time to time of Class A Exchangeable Subordinate Voting Shares (Class A Shares) of BBUC, as described in the Prospectus (defined below); and

 

2.    the prospectus contained in the Registration Statement (as each prospectus may be amended, collectively, the Prospectus).

 

For the purposes of this opinion we have examined and relied upon the documents listed (which in some cases, are also defined) in the Schedule to this opinion (Documents).

 

 

 

Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ London ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich 

 

 

 

 

 

ASSUMPTIONS

 

In stating our opinion we have assumed:

 

1.the authenticity, accuracy and completeness of all Documents submitted to us as originals and the conformity to authentic original Documents of all Documents submitted to us as certified, conformed, notarised or photostatic copies;

 

2.the genuineness of all signatures on the Documents;

 

3.the authority, capacity and power of persons signing the Documents;

 

4.that any representation, warranty or statement of fact or law, other than the laws of Bermuda made in any of the Documents, is true, accurate and complete;

 

5.that there are no provisions of the laws or regulations of any jurisdiction other than Bermuda which would have any implication in relation to the opinions expressed herein;

 

6.the accuracy, completeness and currency of the records and filing systems maintained at the public offices where we have searched or enquired or have caused searches or enquiries to be conducted, that such search and enquiry did not fail to disclose any information which had been filed with or delivered to the relevant body but had not been processed at the time when the search was conducted and the enquiries were made, and that the information disclosed by Company and Partnership Searches and the Litigation Search is accurate and complete in all respects and such information has not been materially altered since the date and time of the Company and Partnership Searches and the Litigation Search;

 

7.that there are no provisions of the laws or regulations of any jurisdiction other than Bermuda which would be contravened by any actions taken by the Partnership in connection with the Registration Statement or which would have any implication in relation to the opinion expressed herein and that, in so far as any obligation under, or action to be taken under, the Registration Statement is required to be performed or taken in any jurisdiction outside Bermuda, the performance of such obligation or the taking of such action will constitute a valid and binding obligation of each of the parties thereto under the laws of that jurisdiction and will not be illegal by virtue of the laws of that jurisdiction;

 

8.any amendment to the Registration Statement and the Prospectus is properly authorized by the Partnership and the terms and transactions contemplated by any such amendment adopted would not be inconsistent with the Resolutions and the terms and transactions contemplated by the Prospectus and the Registration Statement as of the date hereof; and
   
 Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich

 

2

 

 

9.that there are no matters of fact or law (other than matters of Bermuda law) affecting the enforceability of the Constitutional Documents that have arisen since the execution of the Constitutional Documents, as applicable, which would affect the opinions expressed herein.

 

OPINION

 

Based upon and subject to the foregoing and subject to the reservations set out below and to any matters not disclosed to us, we are of the opinion that:

 

1.The Partnership is an exempted limited partnership established and existing under the laws of Bermuda. The Partnership possesses the capacity to sue and be sued in its own name and is in good standing under the laws of Bermuda. All suits in respect of the business of the Partnership shall be prosecuted by and against the General Partner in its capacity as general partner of the Partnership.

 

2.The issue of the Units by the Partnership upon the exchange, redemption or acquisition, as applicable, of Class A Shares has been duly authorized by all necessary action on the part of the Partnership and when allotted, issued and fully paid for pursuant to the terms of the Resolutions and in accordance with the terms and conditions referred to or summarized in the Prospectus and the Registration Statement (including any documents incorporated by reference therein) and the Constitutional Documents (defined below), the Units to be issued by the Partnership upon such exchange, redemption or acquisition will be validly issued, fully paid and non-assessable Units of the Partnership.

 

3.The issue of the Units upon the redemption of redeemable/exchangeable partnership units of Brookfield Business L.P. has been duly authorized by all necessary action on the part of the Partnership and when allotted, issued and fully paid for pursuant to the terms of the Resolutions and in accordance with the terms and conditions referred to or summarized in the Prospectus and the Registration Statement (including any documents incorporated by reference therein) and the Constitutional Documents, the Units to be issued by the Partnership upon such redemption and delivered by BAM upon exchange of Class A Shares will be validly issued, fully paid and non-assessable units of the Partnership.

 

4.The Units to be delivered by BAM upon the exchange of Class A Shares are validly issued, fully paid and non-assessable Units of the Partnership.

 

Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich 

 

3

 

 

RESERVATIONS

 

We have the following reservations:

 

1.We express no opinion as to any law other than Bermuda law and none of the opinions expressed herein relates to compliance with or matters governed by the laws of any jurisdiction except Bermuda. This opinion is limited to Bermuda law as applied by the courts of Bermuda at the date hereof.

 

2.Where an obligation is to be performed in a jurisdiction other than Bermuda, the courts of Bermuda may refuse to enforce it to the extent that such performance would be illegal under the laws of, or contrary to public policy of such other jurisdiction.

 

3.Any reference in this opinion to Units being "non-assessable" shall mean, in relation to fully-paid units of the Partnership and subject to any contrary provision in any agreement in writing between the Partnership and the holder of such units, that: no holder shall be obliged to contribute further amounts to the capital of the Partnership, either in order to complete payment for their units of the Partnership, to satisfy claims of creditors of the Partnership, or otherwise.

 

4.The Limited Partnership Act 1883 (Act) provides that a limited partner shall be liable as a general partner if he takes part in the management of the partnership.

 

5.A limited partner is liable to the Partnership, or to its creditors, for any amount in respect of such limited partner’s contribution to the Partnership to the extent such contribution has not been contributed in full, or to the extent such contribution is either released or returned to the limited partner contrary to the restrictions on reductions of capital contained in the Act.

 

6.A limited partner is liable for damages on account of misrepresentation in respect of false statements contained in the certificate of limited partnership, any supplementary certificates or certificate of cancellation in respect of the Partnership, to the extent a limited partner signed such certificate, or caused another to sign it on his/her behalf, and knew such statement to be false at the time of signature.

 

7.Every partner of the Partnership who is guilty of any fraud in the affairs of the Partnership shall be liable civilly to the party injured to the extent of his damage and shall be liable for penalties applicable to offences committed against the Act.

 

8.In opinion 1. above, the term “good standing” means only that the Partnership has received a Certificate of Compliance from the Registrar of Companies in Hamilton, Bermuda which confirms that it has neither failed to make any filing with any Bermuda governmental authority nor to pay any Bermuda government fee or tax.

 

Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ London ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich

 

4

 

 

9.In order to issue this opinion we have carried out the Company and Partnership Searches as referred to in the Schedule and have not enquired as to whether there has been any change since the date of such searches.

 

10.In order to issue this opinion we have carried out the Litigation Search as referred to in the Schedule and have not enquired as to whether there has been any change since the date of such search.

 

11.Searches of the Register of Companies at the office of the Registrar of Companies and of the Supreme Court Causes Book at the Registry of the Supreme Court and of the Register of Mortgages maintained at the office of the Registry General are not conclusive and it should be noted that the Register of Companies and the Supreme Court Causes Book do not reveal:

 

11.1details of matters which have been lodged for filing or registration which as a matter of best practice of the Registrar of Companies or the Registry of the Supreme Court or the Registry General would have or should have been disclosed on the public file, the Causes Book or the Judgment Book or the Register of Mortgages, as the case may be, but for whatever reason have not actually been filed or registered or are not disclosed or which, notwithstanding filing or registration, at the date and time the search is concluded are for whatever reason not disclosed or do not appear on the public file, the Causes Book, Judgment Book or the Register of Mortgages;

 

11.2details of matters which should have been lodged for filing or registration at the Registrar of Companies, the Registry of the Supreme Court or the Registry General but have not been lodged for filing or registration at the date the search is concluded;

 

11.3whether an application to the Supreme Court for a winding-up petition or for the appointment of a receiver or manager has been prepared but not yet been presented or has been presented but does not appear in the Causes Book at the date and time the search is concluded;

 

11.4whether any arbitration or administrative proceedings are pending or whether any proceedings are threatened, or whether any arbitrator has been appointed; or

 

11.5whether a receiver or manager has been appointed privately pursuant to the provisions of a debenture or other security, unless notice of the fact has been entered in the Register of Charges in accordance with the provisions of the Act.

 

Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich

 

5

 

 

12.With respect to opinions 2, 3 and 4, we have relied upon statements and representations made to us in each Officer Certificate provided to us by an authorised officer of the General Partner for the purposes of this opinion. We have made no independent verification of the matters referred to in any such Officer Certificate, and we qualify such opinions to the extent that the statements or representations made in any such Officer Certificate are not accurate in any respect.

 

DISCLOSURE

 

This opinion is addressed to you in connection with the registration of the Units with the SEC and is not to be used, quoted or relied upon for any other purpose. We consent to the filing of this opinion as an exhibit to the Registration Statement of the Partnership and further consent to the reference to our firm under the caption “Legal Matters” in the Prospectus.

 

This opinion is governed by and is to be construed in accordance with Bermuda law. Further, this opinion speaks as of its date and is strictly limited to the matters stated in it and we assume no obligation to review or update this opinion if applicable law or the existing facts or circumstances should change.

 

Yours faithfully 

 

    /s/ Appleby (Bermuda) Limited

 

Appleby (Bermuda) Limited

 

Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich

 

6

 

 

SCHEDULE

 

1.The respective electronic extracts provided to us by the office of the Registrar of Companies each dated 3 May 2022 in respect of Brookfield Business Partners Limited, the general partner of the Partnership (General Partner) and the Partnership on their files maintained at office of the Registrar of Companies (collectively, the Company and Partnership Searches).

 

2.The entries and filings shown in respect of the General Partner and the Partnership in the Supreme Court Causes Book maintained at the Registry of the Supreme Court in Hamilton, Bermuda, as revealed by searches conducted on 3 May 2022 (Litigation Search).

 

3.Copy of the Amended and Restated Limited Partnership Agreement dated as of 31 May 2016, as amended by the First Amendment to the Amended and Restated Limited Partnership Agreement dated 17 June 2016, as amended by the Second Amendment to the Amended and Restated Limited Partnership Agreement dated 18 May 2020 and as amended by the Third Amendment to the Amended and Restated Limited Partnership Agreement dated 15 March 2022 (Limited Partnership Documents).

 

4.In respect of the Partnership, the Certificate of Registration of an Exempted and Limited Partnership and supplements thereto.

 

5.Certified copies of the Certificate of Incorporation, Memorandum of Association and Bye-Laws of the General Partner (General Partner Constitutional Documents, together with the Limited Partnership Documents, Constitutional Documents).

 

6.Copies of the minutes of a meeting of the board of directors of the General Partner held on 29 April 2022 (Resolutions).

 

7.Copies of officer certificates each dated 3 May 2022 and signed by an officer of the General Partner in respect of the Resolutions and in respect of the Units (each, an Officer Certificate).

 

8.Certificates of Compliances each dated 2 May 2022 in respect of the Partnership and the General Partner, each issued by the Registrar of Companies.

 

9.Copy of the Registration Statement.

 

10.Copy of the Prospectus.

 

Bermuda ¡ British Virgin Islands ¡ Cayman Islands ¡ Guernsey ¡ Hong Kong ¡ Isle of Man ¡ Jersey ¡ Mauritius ¡ Seychelles ¡ Shanghai ¡ Zurich

 

7

 

 EX-23.1 4 tm2213999d2_ex23-1.htm EXHIBIT 23.1

 

Exhibit 23.1

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

We consent to the incorporation by reference in this Registration Statement on Form F-3 of our reports dated April 25, 2022 relating to the financial statements of Brookfield Business Partners L.P. (the “Partnership”) and the effectiveness of the Partnership’s internal control over financial reporting, appearing in the Annual Report on Form 20-F of the Partnership for the year ended December 31, 2021. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

 

/s/ Deloitte LLP

 

Chartered Professional Accountants 

Licensed Public Accountants 

Toronto, Canada 

May 3, 2022

 

 

 EX-23.2 5 tm2213999d2_ex23-2.htm EXHIBIT 23.2

 

Exhibit 23.2

 

 

 

CONSENT OF INDEPENDENT AUDITORS

 

We hereby consent to the incorporation by reference in this Registration Statement on Form F-3 of Brookfield Business Partners L.P. of our report dated 27 September 2021 relating to the financial statements of Modulaire Investments 2 S.à r.l. as at 31 December 2020 prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and subject to an audit under AICPA standards, which appears in this Registration Statement. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

 

We draw attention, that further to the acquisition by Brookfield Business Partners L.P. on December 15, 2021, Modulaire Investments 2 S.à r.l. has not prepared consolidated financial statements for the year ended as at December 31, 2021; as such no further consolidated financial statements after 31 December 2020 have been audited and no further consolidated financial statements after 30 September 2021 have been approved by the Board of Managers which may have identified adjustments on those consolidated financial statements.

 

Yours truly,

 

/s/ PricewaterhouseCoopers, Société coopérative 

 

PricewaterhouseCoopers, Société coopérative 

Represented by Véronique Lefebvre 

Luxembourg, Luxembourg 

May 3rd, 2022

 

 

PricewaterhouseCoopers, Société coopérative, 2 rue Gerhard Mercator, B.P. 1443, L-1014 Luxembourg 

T : +352 494848 1, F : +352 494848 2900, www.pwc.lu

 

Cabinet de révision agréé. Expert-comptable (autorisation gouvernementale n°10028256) 

R.C.S. Luxembourg B 65 477 - TVA LU25482518

 

 

 EX-23.3 6 tm2213999d2_ex23-3.htm EXHIBIT 23.3

 

Exhibit 23.3 

 

CONSENT OF INDEPENDENT AUDITORS

 

We consent to the incorporation by reference in this Registration Statement on Form F-3 of our report dated March 2, 2022 relating to the combined financial statements of the Lottery Business (a carve-out of certain operations of Scientific Games Corporation), appearing in the Current Report on Form 6-K of Brookfield Business Partners L.P. filed on May 3, 2022. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

 

/s/ Deloitte & Touche LLP

 

Las Vegas, Nevada 

May 3, 2022

 

 

 EX-23.4 7 tm2213999d2_ex23-4.htm EXHIBIT 23.4

 

Exhibit 23.4

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

We consent to the incorporation by reference in this Registration Statement on Form F-3 of our report dated August 17, 2021, relating to the financial statements of CDK Global, Inc., appearing in the Current Report on Form 6-K of Brookfield Business Partners L.P. filed on May 3, 2022. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

 

/s/ Deloitte & Touche LLP

 

Chicago, Illinois 

May 3, 2022

 

 

 EX-FILING FEES 8 tm2213999d2_ex-filingfee.htm EX-FILING FEES

 

Exhibit 107

 

Calculation of Filing Fee Tables

 

Form F-3
(Form Type)

 

Brookfield Business Partners L.P.
(Exact Name of Registrant as Specified in its Charter)

 

Table 1: Newly Registered and Carry Forward Securities

 

   Security Type  Security
Class
Title		   Fee
Calculation
or Carry
Forward Rule		   Amount
Registered(2)		   Proposed
Maximum
Offering Price
Per Unit		   Maximum
Aggregate
Offering Price		   Fee Rate   Amount of
Registration Fee		   Carry
Forward
Form Type		   Carry
Forward
File Number		   Carry
Forward
Initial
effective date		   Filing Fee
Previously Paid
In Connection
with Unsold
Securities
to be Carried
Forward		 
Newly Registered Securities
Fees to Be Paid 

Limited

Partnership

Interest

   

Limited  

Partnership Units(1)

    457(c)   60,000,000   $24.55(1)  $1,473,000,000    0.0000927   $136,547.10                 
Fees Previously Paid                                               
Carry Forward Securities
Carry Forward Securities                                                   
   Total Offering Amounts                 $1,473,000,000        $136,547.10                 
   Total Fees Previously Paid                             N/A                     
   Total Fee Offsets                             N/A                     
   Net Fee Due                      $136,547.10                     

 

(1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) under the U.S. Securities Act of 1933, as amended (the “Securities Act”), based upon the average high and low prices of the registrant’s limited partnership units on the New York Stock Exchange on April 29, 2022, of $25.29 and $23.81.

 

(2) Pursuant to Rule 416(a) under the Securities Act, this registration statement also covers an indeterminate number of additional securities that may be offered or issued by the Registrant in connection with any stock split, stock dividend or similar transaction.

 

Table 3: Combined Prospectuses

 

Security Type  Security Class Title  Amount of Securities
Previously Registered (2)		   Maximum Aggregate
Offering Price
of Securities
Previously Registered		   Form
Type		  File
Number		  Initial
Effective Date
Limited Partnership Interest  Limited  Partnership Units (3)   74,300,000(4)  $3,313,745,000.00   Form F-3  333-258765  March 1, 2022

 

(3) No registration fee is payable in connection with the 74,300,000 limited partnership units that were previously registered under Form F-3 (File No. 333-258765) which was initially filed with the Securities and Exchange Commission on August 12, 2021 and became effective on March 1, 2022 (the “Prior Registration Statement”), because such shares are being transferred from the Prior Registration Statement pursuant to Rule 429 under the Securities Act. A registration fee is only payable in connection with the 60,000,000 limited partnership units that were not previously registered under the Prior Registration Statement, with a proposed maximum aggregate offering price of $1,473,000,000.

 

(4) 73,008,085 limited partnership units registered under the Prior Registration Statement that remain unsold are included in this registration statement. Pursuant to Rule 429(b) under the Securities Act, this registration statement, upon effectiveness, will constitute a post-effective amendment to the Prior Registration Statement, which post-effective amendment shall hereafter become effective concurrently with the effectiveness of this registration statement and in accordance with Section 8(c) of the Securities Act (such Prior Registration Statement, as amended by this registration statement, the “Combined Registration Statement”). The amount of securities previously registered under the Prior Registration Statement that were offered and sold before the effective date of this registration statement are not included in the prospectus for the Combined Registration Statement.

 

1

 

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