The information in this preliminary prospectus supplement is not
complete and may be changed. This preliminary prospectus supplement and the
accompanying prospectus do not constitute an offer to sell these securities and
are not soliciting an offer to buy these securities in any jurisdiction where
the offer or sale is not permitted.
Filed
Pursuant to Rule 424(b)(3)
Registration
No. 333-156187
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS SUPPLEMENT DATED SEPTEMBER 22,
2009
PROSPECTUS
SUPPLEMENT
(To short form base shelf
prospectus dated December 23,
2008)
US$
Thomson
Reuters Corporation
% Notes due 20
________________
We will
pay interest on the notes
on and of
each year, beginning
on ,
20 . The notes will mature
on , 20 .
The notes will be direct, unsecured obligations of Thomson Reuters Corporation.
The notes will be issued only in denominations of US$2,000 and multiples of
US$1,000 in excess thereof. We may redeem all or a portion of the notes at any
time at 100% of their principal amount plus a make-whole premium. We will also
have the option to redeem the notes in whole and not in part at any time at 100%
of the aggregate principal amount of the notes plus accrued interest to the date
of redemption in the event of certain changes to Canadian withholding taxes. We
will be required to make an offer to purchase the notes at a price equal to 101%
of their principal amount, plus accrued and unpaid interest to the date of
repurchase, upon the occurrence of a Change of Control Triggering Event (as
defined herein). See the section of this prospectus supplement entitled
“Description of the Notes” for more information, including a description of the
ranking of the notes.
Investing in the notes involves risks
that are described in some of the documents incorporated by reference
herein and in the “Risk Factors” section beginning on page 6 of the
accompanying short form base shelf prospectus.
________________
|
Per
Note
|
Total
|
||
|
Public
offering price (1)
|
%
|
US$
|
|
|
Underwriting
commission
|
%
|
US$
|
|
|
Proceeds
to Thomson Reuters (before expenses)
|
%
|
US$
|
____________
|
(1)
|
Plus
accrued interest on the notes
from , 2009, if
settlement occurs after that date.
|
The notes
will not be listed on any securities exchange or quotation system and,
consequently, there is no market through which the notes may be sold and
purchasers may not be able to resell notes purchased under this prospectus
supplement.
Neither the Securities and Exchange
Commission nor any other regulatory body has approved or disapproved these
securities or passed upon the adequacy or accuracy of this prospectus supplement or the
accompanying short form base shelf prospectus. Any
representation to the contrary is a criminal offense.
We are permitted to prepare this
prospectus supplement and the accompanying short form base shelf prospectus in
accordance with Canadian disclosure requirements, which are
different from those of the United States. We will adopt International Financial
Reporting Standards, or IFRS, for the first time in our financial statements for
the year ended December 31, 2009, which will include comparative financial
statements for the year ended December 31, 2008. Our financial statements
are subject to Canadian
generally accepted auditing standards and the standards of the Public Company
Accounting Oversight Board as well as Canadian and U.S. securities regulatory
auditor independence standards. Our consolidated financial statements may not be
comparable to the financial statements of
U.S. companies.
Owning the notes may subject you to
tax consequences in both the United States and Canada. This prospectus
supplement and the accompanying short form base shelf prospectus may not
describe these tax consequences fully. You should read the tax discussion
contained in this prospectus supplement and the accompanying short form base shelf
prospectus.
Your ability to enforce civil
liabilities under U.S. federal securities laws may be affected adversely
because our company is incorporated under the laws of the Province of
Ontario, Canada, some of our officers and directors and some of the experts named in this prospectus
supplement and the accompanying short form base shelf prospectus are residents
of Canada or the United Kingdom, and some of our assets and
some of the assets of those officers, directors and experts may be located outside of
the United States.
The notes
will be ready for delivery in book-entry form only through the facilities of The
Depository Trust Company and its direct and indirect participants,
including Euroclear and Clearstream, on or
about ,
2009.
________________
Joint
Book-Running Managers
|
BofA
Merrill Lynch
|
Barclays
Capital
|
Deutsche
Bank Securities
|
HSBC
|
,
2009
Prospectus
Supplement
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IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING SHORT FORM BASE SHELF PROSPECTUS
This
document is in two parts. The first part is this prospectus supplement, which
describes the specific terms of the notes. The second part, the accompanying
short form base shelf prospectus, gives more general information, some of which
may not apply to the notes. If the description of the notes varies between this
prospectus supplement and the accompanying short form base shelf prospectus, you
should rely on the information in this prospectus supplement.
You
should rely only on the information contained in or incorporated by reference in
this prospectus supplement, the accompanying short form base shelf prospectus
and the other information included in the registration statement of which the
accompanying short form base shelf prospectus forms a part. We have not
authorized anyone to provide you with different or additional information. We
are not making an offer of notes in any jurisdiction where the offer is not
permitted by law. You should not assume that the information contained in or
incorporated by reference in this prospectus supplement or the accompanying
short form base shelf prospectus is accurate as of any date other than the date
on the front of this prospectus supplement.
In this
prospectus supplement, unless otherwise indicated, capitalized terms which are
defined in the accompanying short form base shelf prospectus are used herein
with the meanings defined in the short form base shelf prospectus. The words
“we,” “us,” “our”, “our company” and “Thomson Reuters” refer to Thomson Reuters
Corporation and its consolidated subsidiaries, unless the context requires
otherwise. Unless otherwise indicated, references in this
prospectus supplement to “$”,
“US$” or “dollars” are to U.S. dollars and references to “C$” are to
Canadian dollars. All references in this prospectus supplement to “£”
are to British pounds sterling.
We will
adopt IFRS, for the first time in our financial statements for the year ended
December 31, 2009, which will include comparative financial statements for the
year ended December 31, 2008. IFRS 1, First-time Adoption of IFRS,
requires that an entity develop accounting policies based on standards and
related interpretations effective at the reporting date of its first annual IFRS
financial statements (which in our situation is December 31,
2009). IFRS 1 also requires that those policies be applied as of the
date of transition to IFRS (which in our situation is January 1, 2008) and
throughout all periods presented in the first IFRS financial statements. The
accompanying interim financial information as of June 30, 2009 and for the six
months ended June 30, 2009 and 2008, and as of March 31, 2009 and for the three
months ended March 31, 2009 and 2008 have been prepared in accordance with those
International Accounting Standards Board, or IASB, standards and International
Financial Reporting Interpretations Committee, or IFRIC, interpretations issued
and effective, or issued and early adopted, at August 10, 2009. The IASB
standards and IFRIC interpretations that will be applicable at December 31,
2009, including those that will be applicable on an optional basis, are not
known with certainty at the time of this filing and were not known with
certainty at the time the interim financial information was
prepared. As a result, the accounting policies used to prepare our
interim financial information are subject to change up to the reporting date of
our first IFRS financial statements. We expect to adopt in our
December 31, 2009 financial statements the IASB standards and IFRIC
interpretations, as published, at August 10, 2009 which were applied in the
preparation of the interim financial information incorporated by reference
herein.
Previously,
our financial statements were prepared in accordance with Canadian generally
accepted accounting principles, or Canadian GAAP. Our amended interim financial
statements for the three months ended March 31, 2009 were prepared in accordance
with IFRS, as issued by the IASB. As these interim financial
statements represent our initial presentation of our results and financial
position under IFRS, they were prepared in accordance with IFRS 1, First-Time Adoption of IFRS
as well as IAS 34, Interim
Financial Reporting. Our amended interim financial statements for the
three months ended March 31, 2009 contain a detailed description of our
conversion to IFRS, including a line-by-line reconciliation of our financial
statements previously prepared under Canadian GAAP to those under IFRS for the
three months ended March 31, 2009 and 2008 and for the year ended December 31,
2008. Our amended management’s discussion and analysis for the three months
ended March 31, 2009 provides a line-by-line reconciliation of our income
statements for the six months ended June 30, 2008 and the nine months ended
September 30, 2008 and a reconciliation of our 2008 pro forma financial
information, which were previously prepared under Canadian GAAP to those under
IFRS.
DOCUMENTS INCORPORATED BY REFERENCE
The
following documents, which have been filed with the securities regulatory
authorities in Canada and filed with, or furnished to, the Securities and
Exchange Commission, or SEC, are specifically incorporated by reference in this
prospectus supplement:
|
|
—
|
our
audited comparative consolidated financial statements for the year ended
December 31, 2008 and the accompanying auditors’ report
thereon;
|
|
|
—
|
our
management’s discussion and analysis for the year ended December 31,
2008;
|
|
|
—
|
our
management information circular dated February 29, 2008 relating to
our special meeting of shareholders held on March 26,
2008;
|
|
|
—
|
our
management information circular dated March 26, 2009 relating to our
annual meeting of shareholders held on May 13,
2009;
|
|
|
—
|
our
management information circular dated July 8, 2009 relating to our special
meeting of shareholders held on August 7,
2009;
|
|
|
—
|
our
annual information form dated March 26, 2009 for the year ended
December 31, 2008;
|
|
|
—
|
our
amended unaudited comparative consolidated financial statements for the
three months ended March 31, 2009;
|
|
|
—
|
our
amended management’s discussion and analysis for the three months ended
March 31, 2009;
|
|
|
—
|
our
unaudited comparative consolidated financial statements for the six months
ended June 30, 2009;
|
|
|
—
|
our
management’s discussion and analysis for the six months ended June 30,
2009;
|
|
|
—
|
our
business acquisition report dated May 15, 2008 relating to our
acquisition of Reuters Group PLC, or Reuters;
and
|
|
|
—
|
our
material change report dated June 22, 2009 relating to the announcement of
our proposal to unify our dual listed company (DLC)
structure.
|
Any
statement contained in this prospectus supplement, the accompanying short form
base shelf prospectus or in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for the
purposes of this prospectus supplement to the extent that a statement contained
in this prospectus supplement, the accompanying short form base shelf prospectus
or in any other subsequently filed or furnished document which also is or is
deemed to be incorporated by reference herein, 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 information set forth in
the document that it modifies or supersedes. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this prospectus supplement.
SPECIAL NOTE
REGARDING FORWARD-LOOKING INFORMATION
Certain
statements included and incorporated by reference in this prospectus supplement
constitute forward-looking statements. When used in this prospectus supplement
or in the documents incorporated by reference herein, the words “anticipate,”
“believe,” “plan,” “estimate,” “expect,” “intend,” “will,” “may” and “should”
and similar expressions are intended to identify forward-looking statements.
These forward-looking statements are not historical facts but reflect
expectations, estimates and projections based on certain assumptions and reflect
our current expectations concerning future results and events. These
forward-looking statements are subject to a number of risks and uncertainties
that could cause actual results or events to differ materially from current
expectations. These risks include, but are not limited to,
|
|
—
|
changes
in the general economy;
|
|
|
—
|
actions
of competitors;
|
|
|
—
|
increased
accessibility to free or relatively inexpensive information
sources;
|
|
|
—
|
failure
to develop new products, services, applications and functionalities to
meet customers’ needs,
attract new customers or expand into new geographic
markets;
|
|
|
—
|
failure
to maintain a high renewal rate for our subscription-based
arrangements;
|
|
|
—
|
failures
or disruptions of network systems or the
Internet;
|
|
|
—
|
detrimental
reliance on third parties for information and other
services;
|
|
|
—
|
changes
to legislation and regulations;
|
|
|
—
|
failure
to meet the challenges involved in operating
globally;
|
|
|
—
|
failure
to protect the reputation of Thomson
Reuters;
|
|
|
—
|
impairment
of goodwill and identifiable intangible
assets;
|
|
|
—
|
inadequate
protection of intellectual property
rights;
|
|
|
—
|
threat
of legal actions and claims;
|
|
|
—
|
downgrading
of credit ratings and adverse conditions in the credit
markets;
|
|
|
—
|
fluctuations
in foreign currency exchange and interest
rates;
|
|
|
—
|
failure
to recruit and retain high quality management and key
employees;
|
|
|
—
|
effect
of factors outside of the control of Thomson Reuters on funding
obligations in respect of pension and post-retirement benefit
arrangements;
|
|
|
—
|
actions
or potential actions that could be taken by
Woodbridge;
|
|
|
—
|
failure
to fully derive anticipated benefits from future or existing acquisitions,
joint ventures, investments or
dispositions;
|
|
|
—
|
failure
to achieve benefits from our integration and savings program to the
extent, or within the time period, currently expected;
and
|
|
|
—
|
failure
to realize the maximum growth potential of Thomson Reuters or to complete
our integration process in a timely
way.
|
These
factors and other risk factors described under the section of the accompanying
short form base shelf prospectus entitled “Risk Factors” and in some of the
documents incorporated by reference herein represent risks that our management
believes are material. Other factors not presently known to us or that we
presently believe are not material could also cause actual results to differ
materially from those expressed in our forward-looking statements. We caution
you not to place undue reliance on these forward-looking statements that reflect
our view only as of the date of this prospectus supplement. We disclaim any
intention or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise, other than
as required by law, rule or regulation. Additional factors are discussed in our
materials filed with the securities regulatory authorities in Canada and filed
with, or furnished to, the SEC from time to time, including our annual
information form for the year ended December 31, 2008, which is contained
in our annual report on Form 40-F for the year ended December 31,
2008, and the other documents incorporated by reference herein.
RISK FACTORS
Investing
in the notes is subject to certain risks. Before purchasing notes, you should
consider carefully the risk factors set forth under the heading “Risk Factors”
in the accompanying short form base shelf prospectus and those under the heading
“Risk Factors” in our annual information form, which is contained in our annual
report on Form 40-F for the year ended December 31, 2008, as well as
the other information contained in and incorporated by reference in this
prospectus supplement. If any of the events or developments discussed in these
risks actually occur, our business, financial condition or results of operations
or the value of the notes could be adversely affected.
BUSINESS
We are
the leading source of intelligent information for the world’s businesses and
professionals, providing customers with competitive advantage. Intelligent
information is a unique synthesis of human intelligence, industry expertise and
innovative technology that provides decision-makers with the knowledge to act,
enabling them to make better decisions faster. Through more than 50,000 people
across more than 100 countries, we deliver this must-have insight to the
financial, legal, tax and accounting, healthcare, science and media markets,
powered by the world’s most trusted news organization.
We are
organized in two divisions:
|
|
—
|
Markets, which consists
of our financial and media
businesses; and
|
|
|
—
|
Professional, which
consists of our legal, tax and accounting, healthcare and scientific
businesses.
|
Thomson
Reuters Corporation is incorporated under the Business Corporations Act
(Ontario), or the OBCA. Our principal executive office is located at 3 Times
Square, New York, New York 10036. Our registered office is located at Suite
2706, Toronto Dominion Bank Tower, P.O. Box 24, Toronto-Dominion Centre,
Toronto, Ontario M5K 1A1, Canada. Prior to April 17, 2008, Thomson Reuters
Corporation was known as The Thomson Corporation.
RECENT
DEVELOPMENTS
On
September 10, 2009, we completed the unification of our DLC structure under
which we had maintained two publicly listed companies - Thomson Reuters
Corporation and Thomson Reuters PLC. Under the unification, each outstanding
Thomson Reuters PLC ordinary share was exchanged for one Thomson Reuters
Corporation common share and each outstanding Thomson Reuters PLC American
Depositary Share was exchanged for six Thomson Reuters Corporation common
shares. As a result of the unification, Thomson Reuters Corporation is now our
sole parent company and Thomson Reuters PLC (which will be renamed as Thomson
Reuters UK Limited) is a wholly-owned subsidiary of Thomson Reuters
Corporation.
In
connection with the unification, we have commenced an internal reorganization
that will include the amalgamation of Thomson Reuters Corporation and Thomson
Reuters PLC. As a result of the amalgamation, Thomson Reuters Corporation will
possess all of the rights and be subject to all of the liabilities of the two
amalgamating companies, including the liabilities that are the subject of the
cross guarantees that our parent companies entered into as part of the DLC
structure in order to place our creditors in the same position they would have
been in had we been operating under a conventional single-parent company
structure.
USE OF
PROCEEDS
We
estimate that the net proceeds from the offering, after deducting the
underwriting commission of
$ million and expenses of
the offering of approximately $ , will
be approximately $ . We
intend to use the net proceeds to partially fund our previously-announced
redemption of the following debt securities:
|
|
—
|
$75,000,000
7.74% notes due December 22, 2010;
|
|
|
—
|
$250,000,000
4.75% notes due May 28, 2010; and
|
|
|
—
|
C$400,000,000
6.85% medium term notes due June 1,
2011.
|
The
redemptions are scheduled to occur during the fourth quarter of
2009.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The
following tables set forth selected consolidated financial information for
Thomson Reuters Corporation presented under IFRS and under Canadian
GAAP.
The
selected consolidated financial information was extracted from, and should be
read in conjunction with (a) our amended unaudited consolidated financial
statements for the three months ended March 31, 2009, presented in accordance
with IFRS, as issued by IASB and (b) our unaudited consolidated financial
statements for the six months ended June 30, 2009, each of which are
incorporated by reference in this prospectus supplement. We also recommend that
you read our consolidated financial statements for the year ended December 31,
2008, which were prepared in accordance with Canadian GAAP, which are
incorporated by reference in this prospectus supplement. Our amended financial
statements for the three months ended March 31, 2009 include reconciliations of
our financial statement information from Canadian GAAP to IFRS for the three
months ended March 31, 2008 and the year ended December 31, 2008. Our financial
statements for the six months ended June 30, 2009 include reconciliations of our
financial statement information from Canadian GAAP to IFRS for the six months
ended June 30, 2008. Interim results are not necessarily indicative of the
results that may be expected for any other interim period or for a full
year.
IFRS
BASIS INFORMATION (UNAUDITED)
(millions
of U.S. dollars, except as otherwise indicated and except for per share
amounts)
|
Six
months ended
|
Year
ended
|
|||||||||||
|
Consolidated Income Statement
Data (1):
|
June
30,
|
December
31,
|
||||||||||
|
2009
|
2008
|
2008
|
||||||||||
|
Revenues
|
6,424 | 4,973 | 11,707 | |||||||||
|
Operating
expenses
|
(4,819 | ) | (3,851 | ) | (8,700 | ) | ||||||
|
Depreciation
|
(242 | ) | (167 | ) | (414 | ) | ||||||
|
Amortization
of computer software
|
(269 | ) | (204 | ) | (482 | ) | ||||||
|
Amortization
of other intangible assets
|
(243 | ) | (180 | ) | (425 | ) | ||||||
|
Impairment
of assets held for sale
|
- | (89 | ) | (86 | ) | |||||||
|
Other
operating gains
|
- | - | 68 | |||||||||
|
Operating
profit
|
851 | 482 | 1,668 | |||||||||
|
Finance
costs, net:
|
||||||||||||
|
Net
interest expense
|
(200 | ) | (12 | ) | (224 | ) | ||||||
|
Other
finance (costs) income
|
(57 | ) | (72 | ) | 231 | |||||||
|
Income
before tax and equity method investees
|
594 | 398 | 1,675 | |||||||||
|
Share
of post tax earnings (loss) in equity method investees
|
1 | 1 | (5 | ) | ||||||||
|
Tax
expense
|
(83 | ) | (46 | ) | (350 | ) | ||||||
|
Earnings
from continuing operations
|
512 | 353 | 1,320 | |||||||||
|
Earnings
(loss) from discontinued operations, net of tax
|
6 | (4 | ) | 1 | ||||||||
|
Net
earnings
|
518 | 349 | 1,321 | |||||||||
|
Earnings
attributable to:
|
||||||||||||
|
Common
and ordinary shareholders
|
505 | 343 | 1,307 | |||||||||
|
Non-controlling
interests
|
13 | 6 | 14 | |||||||||
|
Diluted
earnings per share attributable to common and ordinary
shareholders:
|
||||||||||||
|
From
continuing operations
|
$ | 0.60 | $ | 0.48 | $ | 1.68 | ||||||
|
From
discontinued operations
|
- | (0.01 | ) | - | ||||||||
|
Diluted
earnings per share
|
$ | 0.60 | $ | 0.47 | $ | 1.68 | ||||||
|
Weighted
average number of Thomson Reuters Corporation common shares and Thomson
Reuters PLC ordinary shares outstanding – diluted (in
millions)
|
835.6 | 720.1 | 775.2 | |||||||||
|
Consolidated Statement of Financial
Position Data (1):
|
As
at
|
|||||||
|
June
30,
|
December
31,
|
|||||||
|
2009
|
2008
|
|||||||
|
Cash
and cash equivalents
|
1,572 | 841 | ||||||
|
Current
assets
|
4,090 | 3,686 | ||||||
|
Other
identifiable intangible assets, net
|
8,830 | 8,702 | ||||||
|
Goodwill
|
18,640 | 18,324 | ||||||
|
Total
assets
|
35,517 | 34,589 | ||||||
|
Current
liabilities
|
4,402 | 4,645 | ||||||
|
Long-term
indebtedness (less current portion)
|
7,255 | 6,783 | ||||||
|
Total
equity
|
19,119 | 18,488 | ||||||
_______________
|
(1)
|
The
first date at which we have applied IFRS was January 1, 2008 (the
Transition Date), in accordance with guidelines set out in IFRS 1, First-time Adoption of
IFRS. Accordingly, we do not provide IFRS basis information for
periods prior to the Transition
Date.
|
CANADIAN
GAAP BASIS INFORMATION (UNAUDITED)
(millions
of U.S. dollars, except as otherwise indicated and except for per share
amounts)
|
Year
ended
|
||||||||
|
Consolidated Statement of Earnings
Data:
|
December
31,
|
|||||||
|
2008
|
2007
|
|||||||
|
Revenues
|
11,707 | 7,296 | ||||||
|
Cost
of sales, selling, marketing, general and administrative
expenses
|
(8,700 | ) | (5,275 | ) | ||||
|
Depreciation
|
(831 | ) | (468 | ) | ||||
|
Amortization
|
(411 | ) | (256 | ) | ||||
|
Impairment
of assets held for sale
|
(72 | ) | - | |||||
|
Operating
profit
|
1,693 | 1,297 | ||||||
|
Net
other income (expense)
|
304 | (34 | ) | |||||
|
Net
interest expense and other financing costs
|
(224 | ) | (12 | ) | ||||
|
Income
taxes
|
(351 | ) | (155 | ) | ||||
|
Tradeweb
ownership interests, net of tax
|
(17 | ) | - | |||||
|
Earnings
from continuing operations
|
1,405 | 1,096 | ||||||
|
Earnings
from discontinued operations, net of tax
|
- | 2,908 | ||||||
|
Net
earnings
|
1,405 | 4,004 | ||||||
|
Dividends
declared on preference shares
|
(5 | ) | (6 | ) | ||||
|
Earnings
attributable to Thomson Reuters Corporation common shares and Thomson
Reuters PLC ordinary shares
|
1,400 | 3,998 | ||||||
|
Diluted
earnings per share:
|
||||||||
|
From
continuing operations
|
$ | 1.81 | $ | 1.69 | ||||
|
From
discontinued operations
|
- | 4.51 | ||||||
|
Diluted
earnings per share
|
$ | 1.81 | $ | 6.20 | ||||
|
Weighted
average number of Thomson Reuters Corporation common shares and Thomson
Reuters PLC ordinary shares outstanding – diluted (in
millions)
|
775.2 | 644.4 | ||||||
|
Consolidated Balance Sheet
Data:
|
As
at
|
|||||||
|
December
31,
|
||||||||
|
2008
|
2007
|
|||||||
|
Cash
and cash equivalents
|
841 | 7,497 | ||||||
|
Current
assets
|
3,673 | 9,678 | ||||||
|
Identifiable
intangible assets, net
|
8,596 | 3,438 | ||||||
|
Goodwill
|
19,348 | 6,935 | ||||||
|
Total
assets
|
36,020 | 22,831 | ||||||
|
Current
liabilities
|
4,591 | 3,239 | ||||||
|
Long-term
debt and finance lease obligations (less current portion)
|
6,834 | 4,264 | ||||||
|
Total
shareholders’ equity
|
20,126 | 13,571 | ||||||
CAPITALIZATION AND INDEBTEDNESS
The
following table sets forth Thomson Reuters Corporation’s capitalization and
indebtedness at June 30, 2009 on an actual basis and on an as adjusted basis.
The table is based on Thomson Reuters Corporation’s unaudited consolidated
statement of financial position as at June 30, 2009 and as adjusted to reflect
the issuance of the notes offered hereby and the application of the net proceeds
as described under “Use of Proceeds”, as if this offering and the redemptions,
including the related premiums to be paid, occurred on June 30, 2009. This table
should be read in conjunction with the financial statements and other
information included in the documents incorporated by reference in this
prospectus supplement.
|
As
at June 30, 2009
|
||||||||||||||||
|
Actual
|
DLC
Unification (1)
|
Adjustments
|
As
adjusted
|
|||||||||||||
|
(In
millions of US dollars)
|
||||||||||||||||
|
(Unaudited)
|
||||||||||||||||
|
Current
indebtedness
|
$ | 735 | (2 | ) | ||||||||||||
|
Long-term
indebtedness
|
7,255 | (3 | ) | |||||||||||||
|
Notes
offered hereby
|
- | |||||||||||||||
|
Total
debt (4)
|
7,990 | |||||||||||||||
|
Equity:
|
||||||||||||||||
|
Thomson
Reuters Corporation — Series II preference shares, no nominal
value (authorized, issued and outstanding —
6,000,000)
|
110 | |||||||||||||||
|
Thomson
Reuters Corporation — common shares, no nominal value (issued and
outstanding; authorized — unlimited)
|
2,902 | |||||||||||||||
|
Thomson
Reuters PLC — ordinary shares, £0.25 nominal value (issued and
outstanding; authorized — )
|
89 | |||||||||||||||
|
Contributed
surplus
|
6,998 | |||||||||||||||
|
Accumulated
other comprehensive loss
|
(1,728 | ) | (5 | ) | ||||||||||||
|
Retained
earnings
|
10,678 | (6 | ) | |||||||||||||
|
Total
shareholders’ equity
|
19,049 | |||||||||||||||
|
Non-controlling
interests
|
70 | |||||||||||||||
|
Total
equity
|
19,119 | |||||||||||||||
|
Total
capitalization
|
27,109 | |||||||||||||||
_______________
|
(1)
|
As
discussed in the section entitled “Recent Developments”, we completed our
previously announced DLC unification on September 10, 2009. We include
adjustments to reflect the newly issued Thomson Reuters Corporation common
shares in exchange for Thomson Reuters PLC ordinary shares and American
Depositary Shares.
|
|
(2)
|
The
adjustment is composed of (a) a decrease of $ million representing the
carrying value of the US$250 million principal amount of 4.75% May 2010
notes to be redeemed using a portion of the net proceeds from this
offering; (b) a decrease reflecting the repayment of our $200 million
principal amount of 4.25% notes that matured in August 2009; and (c) a
decrease of $ million to remove the carrying value of our C$300 million
principal amount of 4.35% notes expected to be repaid on their maturity in
December 2009. The notes referred to in (b) and (c) above have been
included in the adjustment as their respective repayments upon maturity
were pre-funded from our March 2009 issuance of C$750 million principal
amount of 6.00% notes due in March 2016. See the section entitled
“Interest Coverage” for additional information on the issuance of notes in
March 2009.
|
Total
cash required to complete the redemptions described in the “Use of Proceeds”
section is approximately $ million. We estimate the net proceeds from
this offering to be approximately $ million.
|
(3)
|
Represents
the carrying value of the $75 million principal amount of 7.74% December
2010 notes and C$400 million principal amount of 6.85% medium-term
June 2011 notes to be redeemed using a portion of the net proceeds from
this offering.
|
|
(4)
|
Total
debt excludes the effect of related debt swaps, which are included within
“Other financial assets - current”, “Other financial assets - non-current”
and “Other financial liabilities - non-current” in Thomson Reuters
Corporation’s consolidated statement of financial position as at June 30,
2009. If this effect had been included, total debt and total
capitalization on an actual and on an as adjusted basis as at June 30,
2009 would have been decreased by $2 million and increased /
decreased by $ million,
respectively.
|
|
(5)
|
The
adjustment to accumulated other comprehensive loss represents the
estimated amount to be recycled to the income statement as a result of
terminating swap agreements previously designated as cash flow hedges of
our Canadian dollar denominated C$400 million principal amount of 6.85%
medium-term June 2011 notes, which will be redeemed prior to their
maturity date using a portion of the proceeds from this
offering.
|
|
(6)
|
The
adjustment to retained earnings reflects the anticipated loss on the
redemption of the debt securities set out in “Use of
Proceeds.”
|
INTEREST COVERAGE
The
information contained in this Interest Coverage section was derived from our
IFRS basis financial information.
After
giving effect to the issuance of notes in June 2008 and March 2009 and the
application of such proceeds, described more fully below, and the issuance of
the notes offered hereby and the application of the net proceeds from this
offering, the as adjusted annualized interest on our total consolidated
indebtedness, including other long-term and current indebtedness for the 12
months ended December 31, 2008 and June 30, 2009, would amount to $ million and
$ million, respectively as at each such date. Our consolidated net earnings
before deducting interest expense (which include the effect of related debt
swaps) and before tax expense for the 12 months ended December 31, 2008 were $
million which is times the as adjusted annualized interest for that period, and
for the 12 months ended June 30, 2009 were $ million which is times the as
adjusted annualized interest for that period.
Excluding
the results of discontinued operations, consolidated net earnings before
deducting interest expense (which include the effect of related debt swaps) and
before tax expense for the 12 months ended December 31, 2008 were $ million
which is times the as adjusted annualized interest for that period, and for the
12 months ended June 30, 2009 were $ million which is times the as adjusted
annualized interest for that period.
Issuance of notes in June
2008
|
|
—
|
In
June 2008 we issued (i) $1.75 billion principal amount of notes
comprised of $750 million principal amount of 5.95% notes due 2013 and
$1.0 billion principal amount of 6.50% notes due 2018; and (ii) C$1.2
billion principal amount of notes comprised of C$600 million principal
amount of 5.25% notes due 2011 and C$600 million principal amount of 5.70%
notes due 2015.
|
|
|
—
|
We
applied the $2.9 billion in net proceeds from the offering to partly repay
$3.4 billion in borrowings under our former bridge credit facility drawn
to finance a portion of the Reuters acquisition and we repaid the
remaining $0.5 billion in bridge credit facility borrowings from available
cash. The bridge credit facility was terminated in
2008.
|
Issuance of notes in March
2009
|
|
—
|
In March 2009 we issued C$750
million principal amount of 6.00% notes due 2016, the proceeds of which
have been used to repay: (i) our C$250 million principal amount of 4.50%
notes that matured in June 2009 and were redeemed for $184 million after
giving effect to swap arrangements and (ii) our $200 million principal
amount of 4.25% notes that matured in August 2009. The remaining proceeds
and other available resources will be used to repay to our C$300 million
principal amount of 4.35% notes upon their maturity in December 2009. We
previously entered into a swap agreement to hedge foreign exchange and
interest rate risks related to these Canadian dollar denominated notes due
in December 2009. As a result, we will repay these notes for an aggregate
amount of $246 million upon maturity. The net proceeds from the
March 2009 issuance were approximately $606 million
(after Dealers’ fees and expenses of the offering). The total cash
required to repay the 2009 debt maturities named above is $630
million.
|
DESCRIPTION OF THE NOTES
The
following description of the notes offered hereby supplements the description of
the general terms of the provisions of the Debt Securities in the accompanying
short form base shelf prospectus under the section entitled “Description of Debt
Securities” and should be read in conjunction with that description. The
description of the notes herein shall prevail to the extent of any
inconsistency.
The notes
will be issued under an indenture dated as of November 20, 2001 between
Thomson Reuters Corporation, Computershare Trust Company of Canada, as the
Trustee, and Deutsche Bank Trust Company Americas, which we refer to as the
Master Indenture, as supplemented by an eighth supplemental indenture dated
September 20, 2005, an eleventh supplemental indenture dated May 29,
2008 and a sixteenth supplemental indenture to be dated the date of issuance of
the notes, together referred to as the Trust Indenture. The
Trust Indenture is subject to the provisions of the OBCA. The
Trust Indenture is also subject to the provisions of the
Trust Indenture Act of 1939, as amended, although it is exempt from the
operation of certain provisions of the Trust Indenture Act pursuant to
Rule 4d-9 thereunder.
This
summary information does not purport to be complete and is qualified in its
entirety by reference to the provisions of the notes and the
Trust Indenture, including the definition of certain terms in the
Trust Indenture. It is the Trust Indenture, and not this summary, that
governs the rights of Holders of notes. Capitalized terms that are used in this
section and not defined have the meaning assigned to them in the
Trust Indenture. We have defined selected terms at the end of this
section.
General
The
aggregate principal amount of the notes will be issued in denominations of
$2,000 and integral multiples of $1,000 in excess thereof. The principal of, and
interest on, the notes will be paid in lawful money of the United States.
Certain Canadian and United States federal income tax considerations applicable
to the notes are described below under “Certain United States Federal Income Tax
Considerations” and “Certain Canadian Federal Income Tax
Considerations.”
Interest
and Maturity
The notes
will have the following terms:
|
Principal Amount
|
Interest
Rate
|
Maturity
Date
|
|
|
$
|
%
|
,
20
|
The notes
will be repayable at 100% of the principal amount at maturity. The notes will
bear interest from , 2009,
payable in semi-annual installments
on and in
each year. Interest on the notes will be paid to persons in whose names the
notes are registered at the close of business on the
preceding or ,
respectively. The first interest payment will be due
on ,
20 .
Ranking
and Other Indebtedness
The notes
will be direct, unsecured obligations of our company.
Until
such time as the reorganization referred to under "Recent
Developments" is completed, the notes will be structurally subordinated to
the other unsecured and unsubordinated obligations of Thomson Reuters
Corporation, which currently are guaranteed by our subsidiary, Thomson Reuters
PLC. Once that reorganization is completed, the other unsecured and
unsubordinated obligations of Thomson Reuters Corporation that are currently
outstanding and guaranteed by Thomson Reuters PLC as a result of the DLC
structure will cease to have a guarantee from our subsidiary, and the notes will
rank equally and ratably with all of those other unsecured and unsubordinated
obligations of Thomson Reuters Corporation.
If the
reorganization referred to under “Recent Developments” is not completed prior to
September 30, 2010, Thomson Reuters PLC will fully and unconditionally guarantee
on an unsecured and unsubordinated basis Thomson Reuters Corporation’s
obligations under the notes and under the Trust Indenture as it relates to the
notes. The Thomson Reuters PLC guarantee would be substantially similar to the
guarantee described in the accompanying short form base shelf prospectus under
the section entitled “Description of Thomson Reuters PLC Guarantee”. In the
event that such a guarantee is put in place, the notes will at that time rank
equally and ratably with all of the other unsecured and unsubordinated
obligations of Thomson Reuters Corporation that are currently
outstanding.
Further
Issuances
We may
from time to time, with respect to the notes, without notice to or the consent
of the Holders, create and issue further notes ranking pari passu with the notes in
all respects and so that such further notes may be consolidated and form a
single series with the notes and have the same terms as to status, redemption or
otherwise as such series of notes offered by this prospectus
supplement.
Optional
Redemption
The notes
will be redeemable in whole or in part at any time, at our option, at a
Redemption Price equal to the greater of:
|
|
—
|
100%
of the principal amount of such
notes, and
|
|
|
—
|
the
sum of the present values of the remaining scheduled payments of principal
and interest thereon (exclusive of interest accrued to the
Redemption Date), discounted to the Redemption Date on a
semi-annual basis at the Treasury Rate
plus basis
points for the notes, in each case together with accrued interest thereon
to the Redemption Date.
|
Interest
will be calculated on the basis of a 360-day year consisting of 12 30-day
months.
Holders
of notes to be redeemed will receive notice thereof by first-class mail at least
30 days and not more than 60 days prior to the date fixed for
redemption.
Unless we
default in the payment of the Redemption Price, on or after the
Redemption Date, interest will cease to accrue on the notes or the portions
thereof called for redemption.
“Comparable Treasury Issue”
means the United States Treasury security or securities selected by an
Independent Investment Banker as having an actual or interpolated maturity
comparable to the remaining term of the notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the notes.
“Comparable Treasury Price”
means, with respect to any Redemption Date, (A) the average of
the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest such Reference Treasury Dealer Quotation, or
(B) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such quotations.
“Independent Investment Banker”
means one of the Reference Treasury Dealers selected by the Trustee after
consultation with us or, if such firm is unwilling or unable to select the
Comparable Treasury Issue, an independent investment banking institution of
national standing in the United States appointed by the Trustee after
consultation with us.
“Reference Treasury Dealer
Quotations” means, with respect to each Reference Treasury Dealer and any
Redemption Date, the average, as determined by the Trustee, of the bid and
asked prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Trustee by such
Reference Treasury Dealer at 3:30 p.m. New York time on the third
business day preceding such Redemption Date.
“Reference Treasury Dealers”
means Banc of America Securities LLC, Barclays Capital Inc., Deutsche
Bank Securities Inc. and HSBC Securities (USA) Inc. or their respective
affiliates which are primary U.S. government securities dealers, and their
respective successors and two other primary U.S. government securities
dealers selected by us; provided, however, that if any of the foregoing or its
affiliates shall cease to be a primary U.S. government securities dealer in
the United States, or Primary Treasury Dealer, another Primary Treasury Dealer
will be substituted therefor by us.
“Treasury Rate” means, with
respect to any Redemption Date, the rate per annum equal to the semi-annual
equivalent yield to maturity or interpolated (on a day count basis) of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for that Redemption Date.
Redemption
for Changes in Canadian Withholding Taxes
The notes
will be redeemable, at our option, in whole and not in part at any time, on not
less than 30 days and not more than 60 days prior written notice, at
100% of the aggregate principal amount, together with accrued interest thereon
to the Redemption Date, in the event we have become or would become
obligated to pay, on the next date on which any amount would be payable with
respect to the notes, any Additional Amounts (as defined below) as a result of a
change in the laws (including any regulations promulgated thereunder) of Canada
(or any political subdivision or taxing authority thereof or therein), or any
change in any official position regarding the application or interpretation of
such laws or regulations, which change is announced or becomes effective on or
after the date of this prospectus supplement.
Any
Person who assumes our obligations under the notes and under the
Trust Indenture pursuant to the provisions described under “Description of
Debt Securities — Merger, Consolidation or Amalgamation” in the
accompanying short form base shelf prospectus will have a similar right to
redeem the notes in the event of any such change in the jurisdiction in which
such Person is organized or existing occurring after such Person assumes our
obligations.
Repurchase
Upon Change of Control Triggering Event
If a
Change of Control Triggering Event (as defined below) occurs, unless we have
exercised our right to redeem the notes as described above, we will be required
to make an offer to repurchase all, or, at the Holder’s option, any part (equal
to $1,000 or an integral multiple thereof), of each Holder’s notes pursuant to
the offer described below, referred to as the Change of Control Offer, on the
terms set forth in the notes. In the Change of Control Offer, we will be
required to offer payment in cash equal to 101% of the aggregate principal
amount of the notes repurchased plus accrued and unpaid interest, if any, on
such notes repurchased, to the date of purchase, referred to as the Change of
Control Payment.
Within
30 days following any Change of Control Triggering Event, we will be
required to mail a notice to Holders of notes, with a copy to the Trustee for
the notes, describing the transaction or transactions that constitute the Change
of Control Triggering Event and offering to repurchase the notes on the date
specified in the notice, which date will be no earlier than 30 days and no
later than 60 days from the date such notice is mailed, referred to as the
Change of Control Payment Date, pursuant to the procedures required by the notes
and described in such notice. We must comply with the requirements of applicable
securities laws and regulations in connection with the repurchase of the notes
as a result of a Change of Control Triggering Event. To the extent that the
provisions of any applicable securities laws or regulations conflict with the
Change of Control (as defined below) provisions of the notes, we will be
required to comply with the applicable securities laws and regulations and will
not be deemed to have breached our obligations under the Change of Control
provisions of the notes by virtue of such conflicts.
On the
Change of Control Payment Date, we will be required, to the extent lawful,
to:
|
|
—
|
accept
for payment all notes or portions of notes properly tendered pursuant to
the Change of Control Offer;
|
|
|
—
|
deposit
with the Paying Agent an amount equal to the Change of Control Payment in
respect of all notes or portions of notes properly
tendered; and
|
|
|
—
|
deliver
or cause to be delivered to the Trustee the notes properly accepted
together with an Officer’s Certificate stating the aggregate principal
amount of notes or portions of notes being purchased by
us.
|
The
Paying Agent will be required to promptly mail to each Holder who properly
tendered notes, the purchase price for such notes and the Trustee will be
required to promptly authenticate and mail (or cause to be transferred by book
entry) to each such Holder a new note equal in principal amount to any
unpurchased portion of the notes surrendered, if any; provided that each new
note will be in a principal amount of $2,000 or an integral multiple of $1,000
in excess thereof.
We will
not be required to make a Change of Control Offer upon a Change of Control
Triggering Event if a third party makes such an offer in the manner, at the
times and otherwise in compliance with the requirements for an offer made by us
and such third party purchases all notes properly tendered and not withdrawn
under its offer.
For
purposes of the repurchase provisions of the notes, the following terms will be
applicable:
“Change of Control” means the
occurrence of any one of the following: (1) the direct or indirect sale,
transfer, conveyance or other disposition (other than by way of merger,
amalgamation, arrangement or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of Thomson
Reuters, taken as a whole, to any person or group, other than to an entity
within Thomson Reuters; (2) the first day on which a majority of the
members of our board of directors are not Continuing Directors (as defined
below); (3) the consummation of any transaction including, without
limitation, any merger, amalgamation, arrangement or consolidation the result of
which is that any person or group of related persons, other than the Woodbridge
Group (as defined below), becomes the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of
more than 50% of the voting stock of our company (which, for greater certainty,
excludes the Thomson Reuters founders share), measured by voting power rather
than number of shares; or (4) the consummation of a so-called “going
private/Rule 13e-3 transaction” that results in any of the effects
described in paragraph (a)(3)(ii) of Rule 13e-3 under the Exchange Act (or
any successor provision), following which the Woodbridge Group beneficially
owns, directly or indirectly, more than 50% of the voting stock of our company
(which, for greater certainty, excludes the Thomson Reuters founders share),
measured by voting power rather than number of shares. For the purposes of this
definition, “person” and “group” have the meanings used in Sections 13(d)
and 14(d) of the Exchange Act.
“Change of Control Triggering Event”
means the occurrence of both a Change of Control and a Rating
Event.
“Continuing Directors” means,
as of any date of determination, any member of our board of directors who
(1) was a member of our board of directors on the date of the issuance of
the notes; or (2) was nominated for election, elected or appointed to our
board of directors with the approval of a majority of the Continuing Directors
who were members of our board of directors at the time of such nomination,
election or appointment (either by a specific vote or by approval of our
management information circular in which such member was named as a nominee for
election as a director).
“DBRS” means DBRS
Limited.
“Fitch” means Fitch Ratings
Ltd.
“Investment Grade Rating”
means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s, BBB
– (or the equivalent) by S&P, BBB (low) (or the equivalent) by DBRS or BBB –
(or the equivalent) by Fitch, and the equivalent investment grade credit rating
from any replacement Rating Agency or Rating Agencies selected by
us.
“Moody’s” means Moody’s
Investors Service, Inc.
“Rating Agencies” means
(a) each of Moody’s, S&P, DBRS and Fitch; and (b) if any of the
Rating Agencies ceases to rate the notes or fails to make a rating of the notes
publicly available for reasons outside of our control, a “nationally recognized
statistical rating organization” within the meaning of
Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act selected by us (as
certified by a resolution of our board of directors) as a replacement for
Moody’s, S&P, DBRS or Fitch, or some or all of them, as the case may
be.
“Rating Event” means the
rating on the notes is lowered by (a) at least three out of four Rating
Agencies, if there are four Rating Agencies or (b) all of the Rating
Agencies, if there are less than four Rating Agencies and the notes are rated
below an Investment Grade Rating by such number of Rating Agencies on any day
within the 60-day period (which 60-day period will be extended so long as the
rating of the notes is under publicly announced consideration for a possible
downgrade by such number of Rating Agencies) after the earlier of (1) the
occurrence of a Change of Control and (2) public notice of the occurrence
of a Change of Control or our intention to effect a Change of Control; provided,
however, that a rating event otherwise arising by virtue of a particular
reduction in rating will be deemed not to have occurred in respect of a
particular Change of Control (and thus will not be deemed a rating event for
purposes of the definition of Change of Control Triggering Event) if the Rating
Agencies making the reduction in rating to which this definition would otherwise
apply do not announce or publicly confirm or inform the Trustee in writing at
our or its request that the reduction was the result, in whole or in part, of
any event or circumstance comprised of or arising as a result of, or in respect
of, the applicable Change of Control (whether or not the applicable Change of
Control has occurred at the time of the rating event).
“S&P” means
Standard & Poor’s Rating Services.
“Woodbridge Group” means at
any particular time such of (a) Woodbridge, (b) the affiliates of
Woodbridge, and (c) the respective successors and assigns of Woodbridge or
any such affiliate, as, at such time, are controlled directly or indirectly by
one or more corporations all of the shares of which are held by one or more
individuals who are members of the family of the late first Lord Thomson of
Fleet or trusts for their benefit.
The
failure by us to comply with the obligations described under “— Repurchase
Upon Change of Control Triggering Event” will constitute an Event of Default
with respect to the notes.
We may
not have sufficient funds to repurchase the notes in cash at such time. In
addition, our ability to repurchase the notes for cash may be limited by law or
the terms of other agreements which we are subject to at the time.
The
Change of Control Triggering Event feature of the notes may in certain
circumstances make more difficult or discourage a sale or takeover of our
company and, thus, the removal of incumbent management. Restrictions on our
ability to incur liens are contained in the covenants as described in the
accompanying short form base shelf prospectus under “Description of the Debt
Securities — Negative Pledge”.
Other
Events of Default for the Notes
In
addition to the Events of Default provided for in respect of any series of
Outstanding Debt Securities under the Master Indenture, subject to certain
exceptions that are described in the Trust Indenture, the failure by our
company or any Material Subsidiary to pay, when due, the principal of any Debt
of our company or any Material Subsidiary (other than any Debt which is owed to
our company or a Subsidiary) or to pay amounts due under any guarantee of any
Debt if the aggregate principal amount of such obligations and guaranteed
obligations exceeds 3% of Consolidated Shareholders’ Equity and, in any such
case, the time for payment has not been effectively extended, excluding any of
the above events in respect of certain Debt where the creditor can only have
recourse to an action in damages and/or to specified assets or revenues, will
constitute an Event of Default with respect to the notes.
Transfer
to Subsidiary
We have
the right at any time, without notice to or consent of the Holders, to have one
of our direct or indirect wholly-owned subsidiaries that is incorporated under
the laws of Canada or any province thereof, any U.S. state, the United
Kingdom or any other country that is a member of the European Union become a
co-obligor under the notes.
If we
were to exercise this right, the co-obligor would become liable for such notes
on a joint and several basis with us, and we would not be released from our
obligations under the Trust Indenture or the notes. The co-obligor’s
obligations under the particular notes would rank equally with all of our other
unsecured and unsubordinated obligations.
Any
payments made by the co-obligor under the notes would be made without
withholding or deduction unless required by law, and the co-obligor would pay
any additional amounts as would result in Holders receiving, after such
withholding or deduction, the amount to which they would otherwise have been
entitled absent such withholding or deduction. For a discussion of certain tax
consequences of an exercise of this right, please see the section of this
prospectus supplement entitled “Certain United States Federal Income Tax
Considerations”.
We have
no current intention to exercise this right.
The
Trustee and Paying Agent
The
initial Trustee and the Paying Agent under the Trust Indenture for the
notes will be Deutsche Bank Trust Company Americas, 60 Wall Street,
New York, New York 10005.
Book-Entry
System, Clearance and Settlement
The notes
will be issued in the form of one or more global certificates representing the
notes, which we refer to as the Global Notes. The Global Notes will be delivered
on the date of closing to, and registered in the name of, The Depository
Trust Company, as depository or its nominee, which we refer to as DTC.
Beneficial interests in the notes will be shown on, and transfers thereof will
be effected only through, records maintained by DTC and its participants, which
include Euroclear and Clearstream. Owners of beneficial interests in the Global
Notes will not be entitled to receive the notes in definitive form (except in
the very limited circumstances described in this section below) and will not be
considered Holders of notes under the Trust Indenture.
DTC is a
limited purpose trust company organized under the New York Banking Law, a
“banking organization” within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a “clearing corporation” within the meaning of
the New York Uniform Commercial Code, and a “clearing agency” registered
pursuant to the provisions of Section 17A of the Securities Exchange Act of
1934. DTC holds securities that its participants deposit with the DTC. DTC also
facilitates the settlement among participants of securities transactions, such
as transfers and pledges, in deposited securities through electronic
computerized book-entry changes in participants’ accounts, thereby eliminating
the need for physical movement of securities certificates. These direct
participants include securities brokers and dealers, banks, trust companies,
clearing corporations and certain other organizations. DTC is owned by a number
of its participants and by the New York Stock Exchange, Inc., the American Stock
Exchange LLC, and the Financial Industry Regulatory Authority. Access to the
DTC’s system is also available to others such as securities brokers and dealers,
banks and trust companies that clear through or maintain a custodial
relationship with a direct participant, either directly or indirectly. The rules
applicable to the DTC and its participants are on file with the
SEC.
Clearstream
is incorporated under the laws of Luxembourg as a professional depositary.
Clearstream holds securities for its participating organizations, or Clearstream
Participants and facilitates the clearance and settlement of securities
transactions between Clearstream Participants through electronic book-entry
changes in accounts of Clearstream Participants, thereby eliminating the need
for physical movement of certificates. Clearstream provides Clearstream
Participants with, among other things, services for safekeeping, administration,
clearance and establishment of internationally traded securities and securities
lending and borrowing. Clearstream interfaces with domestic markets in several
countries. As a professional depositary, Clearstream is subject to regulation by
the Luxembourg Monetary Institute. Clearstream Participants are recognized
financial institutions around the world, including underwriters, securities
brokers and dealers, banks, trust companies, clearing corporations and certain
other organizations, and may include the underwriters. Indirect access to
Clearstream is also available to others, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Clearstream Participant either directly or indirectly.
Distributions
with respect to notes held beneficially through Clearstream will be credited to
cash accounts of Clearstream Participants in accordance with its rules and
procedures to the extent received by DTC for Clearstream.
Euroclear
was created in 1968 to hold securities for participants of Euroclear, or
Euroclear Participants and to clear and settle transactions between Euroclear
Participants through simultaneous electronic book-entry delivery against
payment, thereby eliminating the need for physical movement of certificates and
any risk from lack of simultaneous transfers of securities and cash. Euroclear
includes various other services, including securities lending and borrowing and
interfaces with domestic markets in several markets in several countries.
Euroclear is operated by Euroclear Bank S.A./N.V., or Euroclear Operator, under
contract with Euroclear Clearance Systems S.C., a Belgian cooperative
corporation, or Cooperative. All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for Euroclear on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include the underwriters. Indirect access to Euroclear is also available
to other firms that clear through or maintain a custodial relationship with a
Euroclear Participant, either directly or indirectly.
The
Euroclear Operator is regulated and examined by the Belgian Banking
Commission.
Links
have been established among DTC, Clearstream and Euroclear to facilitate the
initial issuance of the notes sold outside of the United States and cross-market
transfers of the notes associated with secondary market trading.
Although
DTC, Clearstream and Euroclear have agreed to the procedures provided below in
order to facilitate transfers, they are under no obligation to perform these
procedures, and these procedures may be modified or discontinued at any
time.
Clearstream
and Euroclear will record the ownership interests of their participants in much
the same way as DTC, and DTC will record the total ownership of each of the
U.S. agents of Clearstream and Euroclear, as participants in DTC. When
notes are to be transferred from the account of a DTC participant to the account
of a Clearstream participant or a Euroclear participant, the purchaser must send
instructions to Clearstream or Euroclear through a participant at least one day
prior to settlement. Clearstream or Euroclear, as the case may be, will instruct
its U.S. agent to receive notes against payment. After settlement,
Clearstream or Euroclear will credit its participant’s account. Credit for the
notes will appear on the next day (European time).
Because
settlement is taking place during New York business hours, DTC participants will
be able to employ their usual procedures for sending notes to the relevant
U.S. agent acting for the benefit of Clearstream or Euroclear participants.
The sale proceeds will be available to the DTC seller on the settlement date. As
a result, to the DTC participant, a cross-market transaction will settle no
differently than a trade between two DTC participants.
When a
Clearstream or Euroclear participant wishes to transfer notes to a DTC
participant, the seller will be required to send instructions to Clearstream or
Euroclear through a participant at least one business day prior to settlement.
In these cases, Clearstream or Euroclear will instruct its U.S. agent to
transfer these notes against payment for them. The payment will then be
reflected in the account of the Clearstream or Euroclear participant the
following day, with the proceeds back valued to the value date, which would be
the preceding day, when settlement occurs in New York, if settlement is not
completed on the intended value date, that is, the trade fails, proceeds
credited to the Clearstream or Euroclear participant’s account will instead be
valued as of the actual settlement date.
You
should be aware that you will only be able to make and receive deliveries,
payments and other communications involving the notes through Clearstream and
Euroclear on the days when those clearing systems are open for business. Those
systems may not be open for business on days when banks, brokers and other
institutions are open for business in the United States. In addition, because of
time zone differences there may be problems with completing transactions
involving Clearstream and Euroclear on the same business day as in the United
States.
Individual
certificates in respect of the notes will not be issued in exchange for Global
Notes, except in very limited circumstances. If DTC notifies us that it is
unwilling or unable to continue as a clearing system in connection with the
notes or ceases to be a clearing agency registered under the Exchange Act, and a
successor clearing system is not appointed by us within 90 days after
receiving such notice from DTC or upon becoming aware that DTC is no longer so
registered, we will issue or cause to be issued individual certificates in
registered form on registration of transfer of, or in exchange for, book-entry
interests in the notes represented by such Global Notes upon delivery of such
Global Notes for cancellation. In the event that individual certificates are
issued, Holders will be able to receive payments, including principal and
interest, on the notes and effect transfer of the notes at the offices of our
paying and transfer agent. Title to book-entry interests in the notes will pass
by book-entry registration of the transfer within the records of DTC in
accordance with its procedures. Book-entry interests in the notes may be
transferred within DTC in accordance with procedures established for this
purpose by DTC.
Although
DTC has agreed to the foregoing procedures in order to facilitate transfers of
interests in the notes among participants of DTC, it is under no obligation to
perform or continue to perform such procedures and such procedures may be
changed or discontinued at any time.
According
to DTC the foregoing information with respect to DTC has been provided to the
industry for informational purposes only and is not intended to serve as a
representation, warranty, or contract modification of any kind.
The
information in this section concerning DTC and its system has been obtained from
sources that we believe to be reliable, but is subject to any changes to the
arrangements between us and DTC and any changes to such procedures that may be
instituted unilaterally by DTC.
Additional
Amounts
All
payments made by us under or with respect to the notes will be made free and
clear of, and without withholding or deduction for or on account of, any present
or future tax, duty, levy, impost, assessment or other governmental charge
imposed or levied by or on behalf of the Government of Canada or of any province
or territory thereof or by any authority or agency therein or thereof having
power to tax, collectively referred to as Taxes, unless we are required to
withhold or deduct Taxes by law or by the interpretation or administration
thereof. If we are so required to withhold or deduct any amount for or on
account of Taxes from any payment made under or with respect to the notes and
the notes are not redeemed in accordance with the provisions described under
“— Redemption for Changes in Canadian Withholding Taxes,” we will pay such
additional amounts, or Additional Amounts, as may be necessary so that the net
amount received by each Holder (including Additional Amounts) after such
withholding or deduction will not be less than the amount the Holder would have
received if such Taxes had not been withheld or deducted; provided that no
Additional Amounts will be payable with respect to a payment made to a
Holder:
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—
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with
which we do not deal at arm’s length (within the meaning of the Income Tax
Act (Canada)) at the time of making such
payment;
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—
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which
is subject to such Taxes by reason of its being connected with Canada or
any province or territory thereof otherwise than by the mere holding or
ownership of the notes or the receipt of payments
thereunder; or
|
|
|
—
|
which
is subject to such Taxes by reason of its failure to comply with any
certification, identification, information, documentation or other
reporting requirement if compliance is required by law, regulation,
administrative practice or an applicable treaty as a precondition to
exemption from, or a reduction in the rate of deduction or withholding of,
such Taxes.
|
We will
also make such withholding or deduction and remit the full amount deducted or
withheld to the relevant authority in accordance with applicable
law.
We will
furnish to Holders, within 30 days after the date the payment of any Taxes
is due pursuant to applicable law, certified copies of tax receipts evidencing
such payment by us. We will indemnify and hold harmless each Holder and upon
written request reimburse each such Holder for the amount of:
|
|
—
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any
Taxes so levied or imposed which have not been withheld or deducted and
remitted by us and which have been paid by such Holder as a result of
payments made under or with respect to the
notes;
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—
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any
liability (including penalties, interest and expenses) arising therefrom
or with respect thereto or from the failure to make such payment;
and
|
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—
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any
Taxes imposed with respect to any reimbursement under the two bullets
immediately above, but excluding any such Taxes on such Holder’s net
income.
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At least
10 days prior to each date on which any payment under or with respect to
the notes is due and payable, if we will be obligated to pay Additional Amounts
with respect to such payment, we will deliver to the Trustee an Officer’s
Certificate stating the fact that such Additional Amounts will be payable and
the amounts so payable, and will set forth such other information necessary to
enable the Trustee to pay such Additional Amounts to Holders on the payment
date. Whenever in the Trust Indenture there is mentioned, in any context,
the payment of principal (and premium, if any), interest or any other amount
payable under or with respect to any note, such mention shall be deemed to
include mention of the payment of Additional Amounts to the extent that, in such
context, Additional Amounts are, were or would be payable in respect
thereof.
All
payments made by any Person who assumes our obligations under the notes and
under the Trust Indenture pursuant to the provisions described under
“Description of Debt Securities — Merger, Consolidation or Amalgamation” in
the accompanying short form base shelf prospectus will be made without
withholding or deduction or such Person will pay any additional amounts as will
result in Holders receiving, after such withholding or deduction, the amount to
which they would otherwise have been entitled absent such withholding or
deduction, in each case substantially on the terms described under
“— Additional Amounts” with such modifications as are necessary to reflect
the jurisdiction in which such Person is organized or existing.
Prescription
Any money
that we deposit with the Trustee or any Paying Agent or held by us in trust for
the payment of principal of (or premium, if any) or any interest on any note
that remains unclaimed for two years after the date upon which the principal,
premium, if any, or interest are due and payable, will be repaid to us upon our
request subject to the mandatory provisions of any applicable unclaimed property
law. After that time, unless otherwise required by mandatory provisions of any
unclaimed property law, the Holder will be able to seek any payment to which
that Holder may be entitled to collect only from us.
Our
obligation to pay the principal of (or premium, if any) and interest on the
notes will cease if the notes are not presented for payment within a period of
10 years and a claim for interest is not made within five years from the
date on which such principal, premium, if any, or interest, as the case may be,
becomes due and payable.
Notices
Notices
to Holders will be sent by mail to the registered Holders.
CERTAIN UNITED
STATES FEDERAL INCOME TAX CONSIDERATIONS
The
following is a summary of the principal United States federal income tax
consequences of the acquisition, ownership and disposition of a note by a
U.S. Holder (as defined below) who purchases a note at its issue price
within the meaning of Section 1273 of the Internal Revenue Code of 1986, as
amended, or the Code and who holds the note as a “capital asset” for investment
under Section 1221 of the Code. A U.S. Holder is, for United States
federal income tax purposes, an individual citizen or resident of the United
States, a corporation created or organized in or under the laws of the United
States or any State thereof, an estate, the income of which is subject to United
States federal income taxation regardless of its source, and any trust if
(i) a United States court is able to exercise primary supervision over the
administration of the trust and (ii) one or more U.S. persons have the
authority to control all substantial decisions of the trust or if the trust has
validly made an election to be treated as a U.S. person under the
applicable Treasury regulation. If a partnership holds a note, the United States
federal income tax consequences will depend on the status of the partners and
the activities of the partnership. A partner of a partnership that holds a note
should consult its tax advisor regarding the United States federal income tax
consequences of the acquisition, ownership and disposition of a
note.
This
summary is based on the Code, Treasury regulations, rulings and decisions in
effect on the date hereof, all of which are subject to change (possibly with
retroactive effect) and differing interpretations. This summary is intended for
general information only, and does not discuss all of the tax consequences that
may be relevant to the particular circumstances of a U.S. Holder or to
U.S. Holders subject to special tax rules, such as banks, tax-exempt
organizations, insurance companies, dealers in securities or foreign currency,
or persons that hold notes that are a hedge or that are hedged against currency
risks or that are part of a straddle or conversion transaction. Prospective
purchasers of the notes should consult their own tax advisors concerning the
application of United States federal income tax law, as well as the laws of any
state, local or foreign taxing jurisdiction, to their particular situations. See
“Certain Canadian Federal Income Tax Considerations.”
We expect
that the notes will be issued without original issue discount for U.S. federal
income tax purposes. Accordingly, for United States federal income tax purposes,
interest (including any Additional Amounts) on a note generally will be taxable
to a U.S. Holder as ordinary income at the time received or accrued, in
accordance with such holder’s method of accounting for United States federal
income tax purposes. Interest paid by us on the notes will generally constitute
income from sources outside the United States and generally will be “passive
category income” or “general category income” for purposes of computing the
foreign tax credit allowable to a U.S. Holder.
Upon the
sale, redemption or other taxable disposition of a note, a U.S. Holder will
recognize gain or loss, if any, for United States federal income tax purposes,
equal to the difference between the amount realized on such disposition (other
than amounts received that are attributable to accrued but unpaid interest,
which will be taxable as ordinary income to the extent not previously included
in gross income of the U.S. Holder) and such U.S. Holder’s adjusted
tax basis in the note. Such gain or loss generally will constitute United States
source capital gain or loss, and will be long-term capital gain or loss if the
note was held by such U.S. Holder for more than one year. Non-corporate
U.S. Holders (including individuals) can qualify for preferential rates of
United States federal income taxation in respect of long-term capital gains. The
deduction of capital losses is subject to limitation under the
Code.
In
general, information reporting requirements will apply to interest and to the
proceeds received on the disposition of the notes paid within the United States
(and in certain cases, outside the United States) to U.S. Holders. A 28%
backup withholding tax may apply to such amounts if a U.S. Holder
(i) fails to establish properly that it is entitled to an exemption,
(ii) fails to furnish or certify his or her correct taxpayer identification
number to the payer in the manner required, (iii) is notified by the
Internal Revenue Service, or IRS, that he or she has failed to report payments
of interest or dividends properly, or (iv) under certain circumstances,
fails to certify that he or she is not subject to backup withholding for failure
to report interest or dividend payments. The amount of any backup withholding
will be allowed as a credit against the U.S. Holder’s United States federal
income tax liability provided that the required information is timely furnished
to the IRS.
We have
the right to add one of our subsidiaries as a co-obligor of the notes. See
“Description of the Notes — Transfer to Subsidiary” of this prospectus
supplement for more information. If we exercise the right to cause one of our
subsidiaries to become a co-obligor of the notes, the modification should not
cause a deemed exchange of the notes for United States federal income tax
purposes and U.S. Holders should have the same tax basis and holding period
with respect to the notes as before the addition, as long as the addition does
not result in a change in payment expectations.
CERTAIN
CANADIAN FEDERAL INCOME TAX CONSIDERATIONS
Under the
existing laws of Canada and the current administrative practice of the Canada
Revenue Agency the payment by us of interest, principal or premium on the notes
to a holder who is a non-resident of Canada and with whom we deal at arm’s
length within the meaning of the Income Tax Act (Canada), or the Act, at the
time of making the payment will be exempt from Canadian withholding tax. For the
purposes of the Act, related persons (as therein defined) are deemed not to deal
at arm’s length and it is a question of fact whether persons not related to each
other deal at arm’s length.
No other
tax on income (including taxable capital gains) will be payable under the Act in
respect of the holding, redemption or disposition of the notes or the receipt of
interest or premium thereon by holders who are neither residents nor deemed to
be residents of Canada for the purposes of the Act and who do not use or hold
and are not deemed to use or hold the notes in carrying on business in Canada
for the purposes of the Act. The foregoing may not be applicable to a holder
that is a non-resident insurer that carries on an insurance business in Canada
and elsewhere.
This
summary is of a general nature only and does not take into account tax
legislation or considerations of any jurisdiction other than Canada. Purchasers
of the notes should consult their own tax advisors with respect to their
particular circumstances.
UNDERWRITING
We intend
to offer the notes through the Underwriters. Subject to the terms and conditions
contained in an underwriting agreement and the related terms agreement
dated ,
2009, collectively referred to as the Underwriting Agreement, among Thomson
Reuters Corporation and the Underwriters, we have agreed to sell to the
Underwriters and the Underwriters have severally agreed to purchase from us, the
principal amount of the notes listed opposite their names below.
Banc of
America Securities LLC, Barclays Capital Inc., Deutsche Bank Securities Inc. and
HSBC Securities (USA) Inc. are acting as representatives of the Underwriters
named below for the offering of the notes.
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Underwriter
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Principal
Amount
of
Notes
|
|||
|
Banc
of America Securities LLC
|
$ | |||
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Barclays
Capital Inc.
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||||
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Deutsche
Bank Securities Inc.
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||||
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HSBC
Securities (USA) Inc.
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||||
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Total
|
$ | |||
In the
Underwriting Agreement, the several Underwriters have agreed, subject to the
terms and conditions set forth therein, to purchase all the notes offered hereby
if any of the notes are purchased. In the event of default by an Underwriter,
the Underwriting Agreement provides that, in certain circumstances, purchase
commitments of the non-defaulting Underwriters may be increased or the
Underwriting Agreement may be terminated. The obligations of the Underwriters
under the Underwriting Agreement may also be terminated upon the occurrence of
certain stated events.
We have
agreed to indemnify the several Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or to
contribute to payments the Underwriters may be required to make in respect of
those liabilities.
The
Underwriters are offering the notes, subject to prior sale, when, as and if
issued to and accepted by them, subject to approval of legal matters by their
counsel, including the validity of the notes, and other conditions contained in
the Underwriting Agreement, such as the receipt by the Underwriters of officers’
certificates and legal opinions. The Underwriters reserve the right to withdraw,
cancel or modify offers to the public and to reject orders in whole or in
part.
Commissions,
Discounts and Expenses
The
representatives have advised us that the Underwriters propose initially to offer
the notes to the public at the public offering prices set forth on the cover of
this prospectus supplement and to certain dealers at such public offering prices
less a concession not in excess
of % per note. The
Underwriters may allow, and the dealer may reallow, a concession not in excess
of % per note. After the initial
public offering, the public offering prices and concession may be changed by the
Underwriters.
The
expenses of the offering, not including the underwriting commission, are
estimated to be approximately
$ and
are payable by us. We paid SEC registration fees of $117,900 in connection with
the registration statement related to the Debt Securities reflected in the
accompanying short form base shelf prospectus. Additional estimated expenses
incurred by us in connection with the registration statement related to the Debt
Securities reflected in the accompanying short form base shelf prospectus are
approximately $27,000 of legal fees and expenses, approximately $70,000 of
accounting fees and expenses and miscellaneous expenses of approximately
$15,000. No printing and mailing expenses, Trustee fees or stock exchange
listing fees or expenses were incurred in connection with the registration of
the Debt Securities.
Price
Stabilization and Short Positions
In
connection with the offering, the Underwriters are permitted to engage in
transactions that stabilize the market price of the notes. Such transactions
consist of bids or purchases to peg, fix or maintain the price of the notes. If
the Underwriters create a short position in the notes in connection with the
offering, i.e., if they sell more notes than are on the cover page of this
prospectus supplement, the Underwriters may reduce that short position by
purchasing notes in the open market. Purchases of a security to stabilize the
price or to reduce a short position could cause the price of the security to be
higher than it might be in the absence of such purchases.
Neither
we nor any of the Underwriters makes any representation or prediction as to the
direction or magnitude of any effect that the transactions described above may
have on the price of the notes. In addition, neither we nor any of the
Underwriters makes any representation that the Underwriters will engage in these
transactions or that these transactions, once commenced, will not be
discontinued without notice.
Selling
Restrictions
Each of
the Underwriters has represented and agreed that it has not and will not offer,
sell or deliver any of the notes directly or indirectly, or distribute this
prospectus supplement or the accompanying short form base shelf prospectus or
any other offering material relating to the notes, in or from any jurisdiction
except under circumstances that will result in compliance with the applicable
laws and regulations thereof and in a manner that will not impose any
obligations on us, except as set forth in the Underwriting
Agreement.
The notes
will not be qualified for sale under the securities laws of Canada or any
province or territory of Canada and may not be offered or sold, directly or
indirectly, in Canada or to any resident of Canada in contravention of the
securities laws of any province or territory of Canada. Each Underwriter has
represented and agreed that it will not offer, sell or deliver the notes,
directly or indirectly, in Canada or to any resident of Canada in contravention
of the securities laws of any province or territory of Canada, and that any
selling agreement or similar arrangement with respect to the notes will require
any dealer or other party thereto to make a representation to the same
effect.
European
Economic Area
In
relation to each Member State of the European Economic Area, or EEA, which has
implemented the EU prospectus directive, as defined below, each referred to as a
“relevant member state”, with effect from and including the date on which the
prospectus directive is implemented in that relevant member state, or “relevant
implementation date”, the notes which are the subject of the offering
contemplated by this prospectus supplement have not been and will not be offered
to the public in that relevant member state prior to the publication of a
prospectus in relation to the notes which has been approved by the competent
authority in that relevant member state or, where appropriate, approved in
another relevant member state and notified to the competent authority in that
relevant member state, all in accordance with the prospectus directive, except
that, with effect from and including the relevant implementation date, an offer
of notes may be made to the public in that relevant member state:
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—
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to
legal entities which are authorized or regulated to operate in the
financial markets or, if not so authorized or regulated, whose corporate
purpose is solely to invest in
securities;
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—
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to
any legal entity which has two or more of (1) an average of at least
250 employees during the last financial year; (2) a total
balance sheet of more than 43,000,000 Euros and (3) an annual net
turnover of more than 50,000,000 Euros, as shown in its last annual or
consolidated accounts;
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—
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to
fewer than 100 natural or legal persons, other than qualified investors as
defined in the prospectus directive and subject to obtaining the prior
consent of the representatives of the
Underwriters; or
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—
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in
any other circumstances falling within Article 3(2) of the prospectus
directive,
|
provided
that no such offer of notes shall require the publication of a prospectus
pursuant to Article 3 of the prospectus directive or supplement a
prospectus pursuant to Article 16 of the prospectus directive.
For the
purposes of this provision, the expression an offer of notes to the public in
relation to any notes in any relevant member state means the communication in
any form and by any means of sufficient information on the terms of the offer
and the notes to be offered so as to enable an investor to decide to purchase or
subscribe for the notes, as the same may be varied in that Member State by any
measure implementing the prospectus directive in that Member State and the
expression prospectus directive means Directive 2003/71/EC and includes any
relevant implementing measure in each relevant member state.
United
Kingdom
Each
Underwriter has only communicated or caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to engage
in investment activity (within the meaning of Section 21 of the FSMA)
received by it in connection with the issue or sale of notes in circumstances in
which Section 21(1) of the FSMA does not apply to us. Without limitation to
the other restrictions referred to herein, this prospectus supplement is
directed only at (1) persons outside the United Kingdom, (2) persons
having professional experience in matters relating to investments who fall
within the definition of “investment professionals” in Article 19(5) of the
Financial Services and Markets Act 2000 (Financial Promotion) Order 2005; or
(3) high net worth bodies, corporate, unincorporated associations and
partnerships and trustees of high value trusts as described in
Article 49(2) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005. Without limitation to the other restrictions referred to
herein, any investment or investment activity to which this prospectus
supplement relates is available only to, and will be engaged in only with, such
persons, and persons within the United Kingdom who receive this communication
(other than persons who fall within (2) or (3) above) should not rely
or act upon this communication.
Liquidity
The notes
are a new issue of securities with no established trading market. The notes will
not be listed on any securities exchange or on any automated dealer quotation
system. The Underwriters may make a market in the notes after completion of the
offering, but will not be obligated to do so and may discontinue any
market-making activities at any time without notice. No assurance can be given
as to the liquidity of the trading market for the notes or that an active public
market for the notes will develop. If an active public trading market for the
notes does not develop, the market price and liquidity of the notes may be
adversely affected.
Other
Relationships
Certain
of the Underwriters and/or their affiliates have performed certain investment
banking and advisory services for us from time to time for which they have
received customary fees and expenses. The Underwriters may, from time to time,
engage in transactions with, or perform services for, us in the ordinary course
of business and receive fees in connection therewith.
CREDIT
RATINGS
Our
long-term unsecured debt securities are rated Baa1 (stable) by Moody’s, A-
(negative) by S&P, A (low) (stable) by DBRS and A- (stable) by
Fitch.
Credit
ratings are intended to provide investors with an independent measure of the
credit quality of an issue of securities and are indicators of the likelihood of
payment and of the capacity and willingness of a company to meet its financial
commitment on an obligation in accordance with the terms of the obligation. A
description of the rating categories of each of the rating agencies is set out
below.
Moody’s
long-term credit ratings are on a rating scale that ranges from Aaa to C, which
represents the range from highest to lowest quality of such securities rated.
Moody’s “Baa” rating assigned to our long-term debt instruments is the fourth
highest rating of nine rating categories. Obligations rated “Baa” are subject to
moderate credit risk. They are considered medium-grade and as such may possess
certain speculative characteristics. Moody’s appends numerical modifiers from 1
to 3 to its long-term debt ratings, which indicates where the obligation ranks
in its ranking category, with 1 being the highest. Outlooks represent Moody’s
assessment regarding the likely direction of the rating over the
medium-term.
S&P’s
long-term credit ratings are on a rating scale that ranges from AAA to D, which
represents the range from highest to lowest quality of such securities rated.
S&P’s “A” rating assigned to our long-term debt instruments is the third
highest rating of 10 major rating categories. An “A” rating indicates that the
obligor’s capacity to meet its financial commitment is strong, but that the
obligation is somewhat more susceptible to adverse effects of changes in
circumstances and economic conditions than obligations in higher rated
categories. S&P uses “+” or “-” designations to indicate the relative
standing of securities within a particular rating category. Outlooks represent
S&P’s assessment regarding the potential direction of the rating over the
immediate to long-term.
DBRS’
credit ratings are on a long-term debt rating scale that ranges from AAA to D,
which represents the range from highest to lowest quality of such securities
rated. DBRS’s “A” rating assigned to our long-term debt is the third highest of
the 10 rating categories for long-term debt. Debt securities rated “A” are of
satisfactory credit quality and protection of interest and principal is
considered substantial. A reference to “high” or “low” reflects the relative
strength within the rating category. Outlooks represent DBRS’s opinion regarding
the outlook for the ratings.
Fitch’s
long-term credit ratings are on a rating scale that ranges from AAA to D, which
represents the range from highest to lowest quality of such securities rated.
Fitch’s “A” rating assigned to our long-term debt is the third highest rating of
the 11 major rating categories. An “A” rating indicates a low expectation of
credit risk and a strong capacity for the timely payment of financial
commitments. Fitch uses “+” or “-” designations to indicate its relative status
within major rating categories. Outlooks represents Fitch’s assessment regarding
the direction a rating is likely to move over a one to two-year
period.
The
credit ratings by Moody’s, S&P, DBRS and Fitch are not recommendations to
purchase, hold or sell the notes and do not address the market price or
suitability of a specific security for a particular investor. Credit ratings may
not reflect the potential impact of all risks on the value of securities. In
addition, real or anticipated changes in the rating assigned to a security will
generally affect the market value of that security. We cannot assure you that a
rating will remain in effect for any given period of time or that a rating will
not be revised or withdrawn entirely by a rating agency in the
future.
LEGAL
MATTERS
Legal
matters relating to the notes being offered hereby will be passed upon on our
behalf by Torys LLP, New York, New York and Toronto, Ontario with respect
to matters of United States and Canadian law, and on behalf of the underwriters
by Shearman & Sterling LLP, New York, New York, with respect to matters
of United States law. As
at ,
2009, the partners and associates of Torys LLP owned beneficially as a group,
directly or indirectly, less than 1% of our outstanding shares.
Shearman & Sterling LLP has in the past provided, and may continue to
provide, legal services to us.
This short form base shelf prospectus has been filed under
legislation in each of the provinces of Canada that permits
certain information about these securities to be determined after this prospectus has become
final and that permits the omission from this prospectus of that information. The
legislation requires the delivery to purchasers of a prospectus supplement
containing the omitted information within a specified period of time after agreeing to
purchase any of these securities. A
registration statement relating to these securities has
been filed with the U.S. Securities and Exchange Commission, and no
securities may be sold until such registration statement becomes
effective.
This short form base shelf
prospectus is not an offer to sell these securities and it is not
soliciting an offer to buy these securities in any jurisdiction where the offer or sale
is not permitted.
No securities
regulatory authority has expressed an opinion about these securities and it
is an offense to claim otherwise. Information has been incorporated by reference in
this prospectus from documents filed with securities regulatory authorities in
Canada and filed with, or furnished to, the U.S. Securities and Exchange
Commission. Copies of
the documents incorporated herein by reference may be obtained on request
without charge from Thomson Reuters, Attention: Investor Relations Department, 3
Times Square, New York, New York 10036, United States (telephone: 646-223-4000),
and are also available electronically at www.sedar.com and
www.sec.gov.
SHORT
FORM BASE SHELF PROSPECTUS
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New
Issue
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December
23, 2008
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US$3,000,000,000
Debt
Securities
(unsecured)
Issued
by Thomson Reuters Corporation
and
fully and unconditionally guaranteed by Thomson Reuters PLC
Thomson
Reuters Corporation may from time to time offer and issue one or more series of
unsecured debt securities which will be fully and unconditionally guaranteed by
Thomson Reuters PLC, together referred to as Debt Securities, in an aggregate
principal amount of up to US$3,000,000,000 (or the equivalent in other
currencies) or, if any Debt Securities are issued at an original issue discount,
such greater amount as shall result in an aggregate issue price of
US$3,000,000,000 (or the equivalent in other currencies), during the 25 month
period that this short form base shelf prospectus, including any further
amendments hereto, remains valid.
We will
provide the specific terms of the Debt Securities in respect of which this
prospectus is being delivered in applicable prospectus supplements and may
include, where applicable, the specific designation, aggregate principal amount,
currency, maturity, interest provisions, authorized denominations, offering
price, any terms for redemption at our option or at the option of the holder and
any other specific terms. You should read this prospectus and any applicable
prospectus supplements carefully before you invest. Debt Securities may consist
of debentures, notes or other types of debt and may be issuable in series. This
prospectus may not be used to offer Debt Securities unless accompanied by a
prospectus supplement. Our intended use for any net proceeds we expect to
receive from the issue of Debt Securities will be set forth in a prospectus
supplement.
Investing in the Debt Securities is
subject to certain risks. See “Risk Factors” beginning on page 6 of this
prospectus.
All
information permitted under applicable securities laws to be omitted from this
prospectus will be contained in one or more prospectus supplements that will be
delivered to purchasers together with this prospectus. Each prospectus
supplement will be deemed to be incorporated by reference into this prospectus
as of the date of the prospectus supplement and only for the purposes of the
distribution of the Debt Securities to which the prospectus supplement
pertains.
Our
principal executive office is located at 3 Times Square, New York, New York
10036, United States (telephone: 646-223-4000). The registered office of Thomson
Reuters Corporation is located at Suite 2706, Toronto Dominion Bank Tower, P.O.
Box 24, Toronto-Dominion Centre, Toronto, Ontario M5K 1A1, Canada. The
registered office of Thomson Reuters PLC is located at The Thomson Reuters
Building, South Colonnade, Canary Wharf, London E14 5EP, United
Kingdom.
We are permitted, under a
multijurisdictional disclosure system adopted by the United States and Canada, to prepare
this prospectus in accordance with Canadian disclosure requirements, which are
different from those of the United States. We currently present Thomson Reuters
Corporation’s financial statements in accordance with Canadian generally accepted
accounting principles, and its financial statements are subject to Canadian generally
accepted auditing standards and the standards of the U.S. Public Company Accounting
Oversight Board, as well as Canadian and U.S. securities regulatory auditor
independence standards. Commencing in 2009, we intend to present Thomson Reuters
Corporation’s financial statements in accordance with International Financial
Reporting Standards, as
adopted by the European
Union and as issued by the International Accounting Standards Board
(IFRS). Thomson Reuters
Corporation’s consolidated financial statements may not be comparable
to financial statements of U.S.
companies.
Owning the Debt Securities may have
tax consequences in both the United States and Canada. This prospectus and any
applicable prospectus supplement may not describe these tax consequences
fully. You should consult your own tax advisor with respect to your own particular
circumstances and read the tax discussion in this prospectus and any applicable
prospectus supplement.
Your ability to enforce civil
liabilities under U.S. federal securities laws may be affected adversely
because Thomson Reuters Corporation is incorporated under the laws of the Province of
Ontario, Canada and Thomson Reuters PLC is incorporated in England and Wales.
Some of our officers and directors and some of the experts named in this prospectus are
residents of Canada or the United Kingdom, as the case may be, and some of our
assets and some of the assets of those officers, directors and experts may be located
outside of the United States.
Unless otherwise specified in an
applicable prospectus supplement, the Debt Securities will not be listed on any
securities or stock exchange or on any automated dealer quotation system. There is no
market through which the Debt Securities may be sold and purchasers may not be able
to resell the Debt Securities purchased under this prospectus. This may affect the
pricing of the Debt Securities in the secondary market, the transparency and
availability of trading prices, the liquidity of the Debt Securities, and the extent of
issuer regulation.
THESE SECURITIES HAVE NOT BEEN
APPROVED OR DISAPPROVED BY THE U.S. SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES REGULATOR NOR HAS THE U.S. SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES REGULATOR PASSED UPON THE ACCURACY AND ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
TABLE OF CONTENTS
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ABOUT THIS PROSPECTUS
In this
prospectus and any prospectus supplement, the words “we,” “us,” “our” and
“Thomson Reuters” refer to Thomson Reuters Corporation, Thomson Reuters PLC and
their respective consolidated subsidiaries which operate as a unified group
under the DLC structure, unless the context requires otherwise. The term “DLC
structure” refers to the dual listed company structure under which Thomson
Reuters Corporation, Thomson Reuters PLC and their respective consolidated
subsidiaries operate as a unified group and the term “Thomson Reuters board”
refers to the board of directors of each of Thomson Reuters Corporation and
Thomson Reuters PLC. All references in this prospectus and any prospectus
supplement to “$” or “US$” are to U.S. dollars and “C$” are to Canadian dollars.
All references in this prospectus and any prospectus supplement to “£” are to
British pounds sterling.
This
prospectus is part of the registration statement on Form F-9 and Form F-3
relating to the Debt Securities that we filed with the U.S. Securities and
Exchange Commission, or SEC. Under this “shelf” registration process, Thomson
Reuters Corporation may, from time to time, sell any combination of Debt
Securities in one or more offerings up to an aggregate principal amount of
US$3,000,000,000. This prospectus provides you with a general description of the
Debt Securities that we may offer. Each time we sell Debt Securities under the
registration statement, we will provide a prospectus supplement that will
contain specific information about the terms of that offering of Debt
Securities. The prospectus supplement may also add, update or change information
contained in this prospectus. Before you invest, you should read both this
prospectus and any applicable prospectus supplement together with additional
information described under the heading “Where You Can Find More Information.”
This prospectus does not contain all of the information contained in the
registration statement, certain parts of which are omitted in accordance with
the rules and regulations of the SEC. You should refer to the registration
statement and the exhibits to the registration statement for further information
with respect to us and the Debt Securities.
Unless
otherwise indicated, all historical information regarding Thomson Reuters
Corporation included or incorporated by reference in this prospectus has been
prepared in accordance with Canadian generally accepted accounting principles,
or Canadian GAAP, which differs from U.S. generally accepted accounting
principles, or U.S. GAAP. All historical information regarding Reuters Group
PLC, or Reuters, included or incorporated by reference in this prospectus has
been prepared in accordance with International Financial Reporting Standards, as
adopted by the European Union and as issued by the International Accounting
Standards Board, or IFRS. The primary financial statements for Thomson Reuters
shareholders beginning with the six months and quarter ended June 30, 2008 are
the consolidated financial statements of Thomson Reuters Corporation. These
statements, which account for Thomson Reuters PLC as a subsidiary, are prepared
in accordance with Canadian GAAP. We intend to present Thomson Reuters
Corporation’s financial statements in accordance with IFRS commencing in 2009.
Therefore, the financial statements of Thomson Reuters Corporation and Reuters
incorporated by reference in this prospectus, in any applicable prospectus
supplement and in the documents incorporated by reference in this prospectus,
may not be comparable to financial statements prepared in accordance with U.S.
GAAP. You should refer to the notes of the audited comparative consolidated
financial statements of Thomson Reuters Corporation for a discussion of the
principal differences between its financial results calculated under Canadian
GAAP and U.S. GAAP and to the notes of the audited comparative consolidated
financial statements of Reuters for a discussion of the principal differences
between its financial statements calculated under IFRS and Canadian GAAP. Unless
otherwise indicated, financial information in this prospectus has been prepared
in accordance with Canadian GAAP.
WHERE YOU CAN FIND MORE INFORMATION
Information has been incorporated by
reference in this prospectus from documents filed with the securities regulatory
authorities in Canada and filed with, or furnished to, the SEC in the United
States. Copies of the documents incorporated by reference in this
prospectus may be obtained upon written or oral request without charge from
Thomson Reuters, Attention: Investor Relations Department, 3 Times Square, New
York, New York 10036, United States (telephone: 646-223-4000).
You may
also access our disclosure documents and any reports, statements or other
information that we file with the securities regulatory authorities in each of
the provinces of Canada through the Internet on the Canadian System for
Electronic Document Analysis and Retrieval, which is commonly known by the
acronym SEDAR and which may be accessed at www.sedar.com. SEDAR is the
Canadian equivalent of the SEC’s Electronic Document Gathering and Retrieval
System, which is commonly known by the acronym EDGAR and which may be accessed
at www.sec.gov. In
addition to our continuous disclosure obligations under the securities laws of
the provinces of Canada, we are subject to the information requirements of the
U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, and, in
accordance with the Exchange Act, we file with and furnish to the SEC reports
and other information.
You may
read or obtain copies, at a fee, of any document we file with or furnish to the
SEC at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C.
20549. Please call the SEC at 1-800-SEC-0330 or access its website at www.sec.gov for further
information on the public reference room. Our filings are also electronically
available on EDGAR, as well as from commercial document retrieval services, such
as Westlaw Business.
You are
invited to read and copy any reports, statements or other information that we
file with the securities regulatory authorities in each of the provinces of
Canada at their respective public reference rooms. Reports and other information
about us may also be available for inspection at the offices of the New York
Stock Exchange, the UK Listing Authority and Nasdaq. Under the
multijurisdictional disclosure system adopted by the United States and Canada,
we are permitted to incorporate by reference in this prospectus certain
information we file with or furnish to the SEC and the securities regulatory
authorities in Canada, which means that we can disclose important information to
you by referring you to those documents. Information incorporated by reference
is an important part of this prospectus. Information incorporated by reference
must be filed as exhibits to the registration statement on Form F-9 and Form F-3
that we have filed with the SEC in connection with the Debt
Securities.
ENFORCEABILITY OF CIVIL LIABILITIES
Thomson
Reuters Corporation is a corporation incorporated under and governed by the
Business Corporations Act
(Ontario) and Thomson Reuters PLC is a public limited company
incorporated in England and Wales. The controlling shareholder of Thomson
Reuters and some of our directors and officers, as well as certain of the
experts named in this prospectus and the documents incorporated by reference
into this prospectus, are residents of Canada or the United Kingdom and all or a
substantial portion of their assets and a substantial portion of our assets are
located outside of the United States. It may be difficult for holders of Debt
Securities to effect service within the United States upon our controlling
shareholder and our directors and officers and the experts named in this
prospectus and any documents incorporated by reference into this prospectus who
are not residents of the United States or to enforce against them in the United
States judgments of courts of the United States predicted upon civil liability
under United States federal securities laws. We believe that a monetary judgment
of a United States court predicated solely upon civil liability under United
States federal securities laws would likely be enforceable in Canada if the
United States court in which the judgment was obtained had a basis for
jurisdiction in the matter that was recognized by a Canadian court for such
purposes. We cannot assure you that this will be the case. It is less certain
that an action could be brought in Canada in the first instance on the basis of
liability predicated solely upon such laws.
DOCUMENTS INCORPORATED BY REFERENCE
The
following documents, which have been filed with the securities regulatory
authorities in Canada and filed with, or furnished to, the SEC, are specifically
incorporated by reference in this prospectus:
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audited
comparative consolidated financial statements of Thomson Reuters
Corporation for the year ended December 31, 2007 and the accompanying
auditors’ report thereon;
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management’s
discussion and analysis of Thomson Reuters Corporation for the year ended
December 31, 2007;
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annual
report on Form 20-F of Thomson Reuters PLC dated April 17, 2008 for the
year ended December 31, 2007;
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management
information circular of Thomson Reuters Corporation dated March 28, 2008
relating to its annual meeting of shareholders held on May 7,
2008;
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management
information circular of Thomson Reuters Corporation dated February 29,
2008 relating to its special meeting of shareholders held on March 26,
2008;
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annual
information form of Thomson Reuters Corporation dated March 10, 2008 for
the year ended December 31, 2007;
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unaudited
comparative consolidated financial statements of Thomson Reuters
Corporation for the nine months ended September 30,
2008;
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management’s
discussion and analysis of Thomson Reuters Corporation for the nine months
ended September 30, 2008; and
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business
acquisition report of Thomson Reuters Corporation dated May 15, 2008
relating to its acquisition of
Reuters.
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Any
statement contained in this prospectus or in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for the purposes of this prospectus to the extent that a statement
contained herein, or in any other subsequently filed or furnished document which
also is or is deemed to be incorporated by reference herein, 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 information
set forth in the document that it modifies or supersedes. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this prospectus.
Any
documents of the type referred to above, all material change reports (excluding
confidential material change reports, if any) and all updated interest coverage
ratio information that we file with the securities regulatory authorities in
Canada after the date of this prospectus and prior to the termination of the
distribution of Debt Securities shall be deemed to be incorporated by reference
into this prospectus. To the extent that any document or information
incorporated by reference into this prospectus is included in a report that is
filed with, or furnished to, the SEC on Form 40-F, 20-F or 6-K (or any
respective successor form), such document or information shall also be deemed to
be incorporated by reference as an exhibit to the registration statement of
which this prospectus forms a part.
When we
file a new annual information form or annual report and the related audited
comparative consolidated financial statements with, and where required, they are
accepted by, the applicable securities regulatory authorities during the time
that this prospectus is valid, the previous annual information form or annual
report, the previous audited comparative consolidated financial statements and
all unaudited comparative consolidated financial statements, material change
reports, information circulars and business acquisition reports filed prior to
the commencement of the financial year in which the new annual information form
or annual report is filed will be deemed no longer to be incorporated by
reference into this prospectus for purposes of future offers and sales of Debt
Securities under this prospectus.
A
prospectus supplement containing the specific terms of any Debt Securities will
be delivered, together with this prospectus, to purchasers of such Debt
Securities and will be deemed to be incorporated into this prospectus for the
purposes of securities legislation as of the date of such prospectus supplement,
but only for the purposes of the distribution of the Debt Securities to which
such prospectus supplement pertains.
You
should rely only on the information contained in or incorporated by reference in
this prospectus or any applicable prospectus supplement and on the other
information included in the registration statement of which this prospectus
forms a part. We have not authorized anyone to provide you with different or
additional information. We are not making an offer of Debt Securities in any
jurisdiction where the offer is not permitted by law. You should not assume that
the information contained in or incorporated by reference in this prospectus or
any applicable prospectus supplement is accurate as of any date other than the
date on the front of the applicable prospectus supplement.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain
statements included and incorporated by reference in this prospectus constitute
forward-looking statements. When used in this prospectus or in the documents
incorporated by reference herein, the words “anticipate,” “believe,” “plan,”
“estimate,” “expect,” “intend,” “will,” “may” and “should” and similar
expressions are intended to identify forward-looking statements. These
forward-looking statements are not historical facts but reflect expectations,
estimates and projections based on certain assumptions and reflect our current
expectations concerning future results and events. These forward-looking
statements are subject to a number of risks and uncertainties that could cause
actual results or events to differ materially from current expectations. These
risks include, but are not limited to:
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changes
in the general economy;
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actions
of competitors;
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changes
to legislation and regulations;
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increased
accessibility to free or relatively inexpensive information
sources;
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failure
to fully derive anticipated benefits from future or existing acquisitions,
joint ventures, investments or
dispositions;
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failure
to develop new products, services, applications and functionalities to
meet customers’ needs, attract new customers or expand into new geographic
markets;
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failure
of electronic delivery systems, network systems or the
Internet;
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detrimental
reliance on third parties for
information;
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failure
to meet the challenges involved in the expansion of international
operations;
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failure
to realize the anticipated cost savings and operating efficiencies from
our integration program and other cost-saving initiatives, including those
designed to make Thomson Reuters a more integrated
group;
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failure
to protect the reputation of Thomson
Reuters;
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impairment
of goodwill and identifiable intangible
assets;
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failure
of significant investments in technology to increase revenues or decrease
operating costs;
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increased
self-sufficiency of customers;
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inadequate
protection of intellectual property
rights;
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downgrading
of credit ratings and adverse conditions in the credit
markets;
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threat
of legal actions and claims;
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changes
in foreign currency exchange and interest
rates;
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failure
to recruit and retain high quality management and key
employees;
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effect
of factors outside the control of Thomson Reuters on funding obligations
in respect of pension and post-retirement benefit arrangements;
and
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actions
or potential actions that could be taken by our principal shareholder, The
Woodbridge Company Limited, or
Woodbridge.
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These
factors and other risk factors described herein, including under the section of
this prospectus entitled “Risk Factors,” and in some of the documents
incorporated by reference in this prospectus represent risks that our management
believes are material. Other factors not presently known to us or that we
presently believe are not material could also cause actual results to differ
materially from those expressed in our forward-looking statements. We caution
you not to place undue reliance on these forward-looking statements that reflect
our view only as of the date of this prospectus. We disclaim any intention or
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, other than as required by
law, rule or regulation. Additional factors are discussed in our materials filed
with the securities regulatory authorities in Canada and filed with, or
furnished to, the SEC from time to time, including the annual information form
of Thomson Reuters Corporation for the year ended December 31, 2007, which is
contained in an annual report on Form 40-F for the year ended December 31, 2007,
the annual report on Form 20-F of Thomson Reuters PLC for the year ended
December 31, 2007 and the other documents incorporated by reference
herein.
RISK
FACTORS
Investing in the Debt Securities is
subject to certain risks. Before purchasing Debt Securities, you should consider
carefully the risk factors set forth below and those under the heading “Risk Factors” in
the annual information form of Thomson Reuters Corporation, which is contained in
an annual report on Form 40-F for the year ended December 31, 2007 (and
its annual information forms for subsequent years) and the annual report on Form
20-F of Thomson Reuters PLC for the year ended December 31, 2007 (and
its annual reports for subsequent years), as well as the other information
contained in and incorporated by reference in this prospectus (including subsequently
filed documents incorporated by reference) and, if applicable, those described in the
applicable prospectus supplement. If any of the events or developments discussed in
these risks actually occur, our business, financial condition or results of
operations or the value of the Debt Securities could be adversely
affected.
Risks
Relating to the Debt Securities
Fluctuations
in exchange rates could give rise to foreign currency exposure.
Debt
Securities denominated or payable in foreign currencies may entail significant
risks, and the extent and nature of such risks change continuously. These risks
include, without limitation, the possibility of significant fluctuations in the
foreign currency market, the imposition or modification of foreign exchange
controls and potential illiquidity in the secondary market. These risks will
vary depending on the currency or currencies involved. Prospective purchasers
should consult their own financial and legal advisors as to the risks entailed
in an investment in Debt Securities denominated in currencies other than the
local currency. Debt Securities are not an appropriate investment for investors
who are unsophisticated with respect to foreign currency
transactions.
Credit
ratings assigned to Debt Securities may change.
We cannot
assure you that any credit rating assigned to Debt Securities issued hereunder
will remain in effect for any given period of time or that any rating will not
be lowered or withdrawn entirely by the relevant rating agency. A lowering or
withdrawal of such rating may have an adverse effect on the market value of the
Debt Securities.
There
may not be a trading market for the Debt Securities.
There is
currently no market through which the Debt Securities may be sold and you may
not be able to resell the Debt Securities issued hereunder. We cannot assure you
that a secondary market for trading in the Debt Securities will develop or that
any secondary market which does develop will continue.
The
Debt Securities will be subordinated to creditors of our
subsidiaries.
We
conduct our operations through a number of subsidiaries and to the extent any
such subsidiary has or incurs indebtedness with a third party, the holders of
the Debt Securities will effectively be subordinated to the claims of the
holders of such third party indebtedness, including in the event of liquidation
or upon a realization of the assets of any such subsidiary.
We have made only
limited covenants in the trust indenture governing the Debt Securities and
these limited covenants may not protect your investment.
The trust
indenture governing the Debt Securities does not:
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require
us to maintain any financial ratios or specific levels of net worth,
revenues, income, cash flows or liquidity and, accordingly, does not
protect holders of the Debt Securities in the event that we experience
significant adverse changes in our financial condition or results of
operations;
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limit
our ability to incur indebtedness that is equal in right of payment to the
Debt Securities;
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restrict
our ability to transfer assets within Thomson
Reuters;
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restrict
our ability to repurchase our
shares;
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restrict
our ability to make investments or to pay dividends or make other payments
in respect of our shares or other securities ranking junior to the Debt
Securities; or
|
|
|
—
|
necessarily
afford holders of Debt Securities protection should we be involved in a
transaction that significantly increases our
leverage.
|
The trust
indenture governing the Debt Securities contains only limited protections in the
event of many types of transactions that we could engage in, including
acquisitions, refinancings, recapitalizations or restructurings that could
substantially affect our capital structure and the value of the Debt Securities.
If any such transaction should occur, the value of your Debt Securities may
decline.
Risks
Relating to the Thomson Reuters PLC Guarantee
Thomson Reuters
PLC’s guarantee is governed by the laws of England, and an action to
enforce the
guarantee must be brought in the courts of England and
Wales.
Unlike
the Debt Securities, which will be governed by, and construed in accordance
with, the laws of the State of New York, Thomson Reuters PLC’s guarantee of the
Debt Securities is provided under a separate deed of guarantee that is governed
by the laws of England. An action to enforce the guarantee must be brought
exclusively in the courts of England and Wales. Because of the exclusive
jurisdiction of the English courts, an action to enforce the Thomson Reuters PLC
guarantee may be separate from an action against Thomson Reuters Corporation to
enforce the terms of the Debt Securities or the trust indenture, which grants
non-exclusive jurisdiction to specified courts in the United States.
Furthermore, the Thomson Reuters PLC deed of guarantee was executed in
connection with the implementation of the DLC structure, which is a relatively
uncommon way of acquiring a company and there is little or no English case law
relating to dual listed company structures or the contractual arrangements or
provisions in companies’ organizational documents related to them. Given all
these factors, it may be more difficult and time consuming for holders of the
Debt Securities to enforce the Thomson Reuters PLC guarantee than a guarantee
governed by the laws of the State of New York in a more traditional
financing.
Thomson
Reuters PLC is a public company incorporated in England and Wales. Although
Thomson Reuters PLC has appointed Thomson Reuters Corporation as its agent for
service of process in each of the provinces of Canada and Thomson Reuters
Holdings Inc. as its agent for service of process in the United States, it may
not be possible for investors to enforce judgments obtained in Canada or the
United States against Thomson Reuters PLC without further enforcement
proceedings, which may or may not be successful. In addition, because a
substantial portion of Thomson Reuters PLC’s assets are located outside of the
United Kingdom, any judgment related to the Thomson Reuters PLC guarantee in
England may need to be enforced in other countries, such as the United States or
Canada, which may require further court proceedings.
Thomson Reuters
PLC’s guarantee may be unenforceable due to fraudulent conveyance statutes and,
accordingly, you could have no claim against Thomson Reuters PLC, as
guarantor
of any Debt Securities.
Although
laws differ among various jurisdictions, a court could, under fraudulent
conveyance laws, subordinate or avoid the guarantee of Thomson Reuters PLC if it
found that the guarantee was incurred with actual intent to hinder, delay or
defraud creditors, or if Thomson Reuters PLC did not receive fair consideration
or reasonably equivalent value for the guarantee and that Thomson Reuters
PLC:
|
|
—
|
was
insolvent or rendered insolvent because of the
guarantee;
|
|
|
—
|
was
engaged in a business or transaction for which its remaining assets
constituted unreasonably small capital;
or
|
|
|
—
|
intended
to incur, or believed that it would incur, debts beyond its ability to pay
at maturity.
|
If a
court were to void the Thomson Reuters PLC guarantee as a fraudulent conveyance
or hold it unenforceable for any other reason, you would cease to have a claim
against Thomson Reuters PLC based on its guarantee and would solely be a
creditor of Thomson Reuters Corporation.
BUSINESS
Thomson
Reuters is the leading source of intelligent information for the world’s
businesses and professionals, providing customers with competitive advantage.
Intelligent information is a unique synthesis of human intelligence, industry
expertise and innovative technology that provides decision-makers with the
knowledge to act, enabling them to make better decisions faster. Through more
than 50,000 people across 93 countries, Thomson Reuters delivers this must-have
insight to the financial, legal, tax and accounting, scientific, healthcare and
media markets, and is powered by the world’s most trusted news
organization.
Thomson
Reuters is organized in two divisions:
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|
—
|
Markets, which consists
of our financial businesses; and
|
|
|
—
|
Professional, which
consists of our Legal, Tax & Accounting, Scientific and Healthcare
segments.
|
Our
principal executive office is located at 3 Times Square, New York, New York
10036, with key staff also located in Stamford, Connecticut and London, United
Kingdom.
THE
DUAL LISTED COMPANY STRUCTURE
Under the
DLC structure, Thomson Reuters has two parent companies, both of which are
publicly listed — Thomson Reuters Corporation, an Ontario corporation, and
Thomson Reuters PLC, an English public limited company. Thomson Reuters
Corporation and Thomson Reuters PLC operate as a unified group pursuant to
contractual arrangements as well as provisions in their organizational
documents. Under the DLC structure, shareholders of Thomson Reuters Corporation
and Thomson Reuters PLC both have a stake in Thomson Reuters, with cash
dividend, capital distribution and voting rights that are comparable to the
rights they would have if they were holding shares in one company carrying on
Thomson Reuters business.
Key
features of the DLC structure include the following:
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—
|
Thomson
Reuters Corporation and Thomson Reuters PLC are separate publicly listed
companies;
|
|
|
—
|
the
boards of directors of the two companies comprise the same individuals, as
do the companies’ executive
management;
|
|
|
—
|
shareholders
of the two companies ordinarily vote together as a single decision-making
body, including in the election of
directors;
|
|
|
—
|
shareholders
of the two companies receive equivalent cash dividends and capital
distributions;
|
|
|
—
|
each
company has guaranteed all contractual obligations of the other company,
and those of other parties to the extent they are guaranteed by the other
company, and will guarantee other obligations as agreed;
and
|
|
|
—
|
a
take-over bid or similar transaction is required to be made for shares of
both companies on an equivalent
basis.
|
Thomson
Reuters Corporation was incorporated under the Business Corporations Act
(Ontario) by articles of incorporation dated December 28, 1977. Thomson Reuters
Corporation amended and restated its articles effective April 17, 2008. Its
registered office is located at Suite 2706, Toronto Dominion Bank Tower, P.O.
Box 24, Toronto-Dominion Centre, Toronto, Ontario M5K 1A1, Canada. Prior to
April 17, 2008, Thomson Reuters Corporation was known as The Thomson
Corporation.
Thomson
Reuters PLC is a public company limited by shares incorporated on March 6, 2007
under the UK Companies Act of
1985. Its registered office is located at The Thomson Reuters Building,
South Colonnade, Canary Wharf, London E14 5EP, United Kingdom.
USE
OF PROCEEDS
Unless
otherwise specified in a prospectus supplement that accompanies this prospectus,
the net proceeds from the sale of the Debt Securities will be added to our
general funds and we may use them for general corporate purposes including,
without limitation, to repay existing indebtedness. We may invest funds that we
do not immediately use in short-term marketable securities. We may from time to
time offer Debt Securities and incur additional indebtedness other than through
an offering under this prospectus and any applicable prospectus
supplements.
CAPITALIZATION AND INDEBTEDNESS
The
following table sets forth Thomson Reuters Corporation’s capitalization and
indebtedness at September 30, 2008 on an actual basis and on an as adjusted
basis. The table is based on Thomson Reuters Corporation’s unaudited
consolidated balance sheet as at September 30, 2008 and as adjusted to apply
cash used to repay €250 million principal amount of floating rate notes due
November 2008, as if the notes were repaid on September 30, 2008. This table
should be read in conjunction with the financial statements and other
information included in the documents incorporated by reference in this
prospectus.
|
As at September 30,
2008
|
||||||||||||
|
Actual
|
Adjustments
|
As Adjusted
|
||||||||||
|
(In
millions of US dollars)
|
||||||||||||
|
(Unaudited)
|
||||||||||||
|
Short-term
indebtedness
|
$ | 16 | — | $ | 16 | |||||||
|
Current
portion of long-term debt and finance lease obligations
|
832 | (366 | ) (2) | 466 | ||||||||
|
Long-term
debt and finance lease obligations (less current portion)
|
7,440 | — | 7,440 | |||||||||
|
Total
debt (1)
|
8,288 | (366 | ) | 7,922 | ||||||||
|
Shareholders’
equity:
|
||||||||||||
|
Thomson
Reuters Corporation — Series II preference shares, no par value
(authorized, issued and outstanding — 6,000,000)
|
144 | — | 144 | |||||||||
|
Thomson
Reuters Corporation — common shares, no par value (643,721,387 issued and
outstanding; authorized — unlimited)
|
2,761 | — | 2,761 | |||||||||
|
Thomson
Reuters PLC — ordinary shares (180,835,266 issued and
outstanding)
|
87 | — | 87 | |||||||||
|
Additional
paid-in capital
|
8,063 | — | 8,063 | |||||||||
|
Accumulated
other comprehensive loss
|
(1,517 | ) | — | (1,517 | ) | |||||||
|
Retained
earnings
|
10,539 | — | 10,539 | |||||||||
|
Total
shareholders’ equity
|
20,077 | — | 20,077 | |||||||||
|
Total
capitalization
|
$ | 28,365 | $ | (366 | ) | $ | 27,999 | |||||
____________
|
(1)
|
Total
debt excludes the effect of related debt swaps, which are included within
“Prepaid expenses and other current assets,” “Other non-current assets,”
“Accounts
payable and
accruals,” and “Other non-current liabilities” in Thomson
Reuters Corporation’s
consolidated balance sheet as at September 30, 2008. If this effect
had been included, total debt and total capitalization on an actual and on
an as adjusted basis as at September 30, 2008 would have been reduced by
$271 million.
|
|
(2)
|
$366
million represents the carrying value of the €250 million principal amount
of floating rate notes due November 2008 as at September 30, 2008. Thomson
Reuters entered into a cross-currency swap agreement whereby these notes
were redeemed for $398 million.
|
INTEREST COVERAGE
The
following table sets forth interest coverage ratios for Thomson Reuters
Corporation for the 12 month periods ended December 31, 2007 and September 30,
2008 on an as adjusted basis to reflect the following events:
|
|
—
|
the
issuance in October 2007 of $800 million aggregate principal amount of
5.70% notes due 2014 and the application of the net proceeds from that
offering, as if such offering occurred at the beginning of each
period;
|
|
|
—
|
the
issuance in June 2008 of (a) $1.75 billion of notes comprised of $750
million principal amount of 5.95% notes due 2013 and $1.0 billion
principal amount of 6.50% notes due 2018; and (b) C$1.2 billion principal
amount of notes comprised of C$600 million principal amount of 5.25% notes
due 2011 and C$600 million principal amount of 5.70% notes due 2015, as if
such offerings occurred at the beginning of each period;
and
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|
|
—
|
the
application of the $2.9 billion in net proceeds from the offerings of
notes in June 2008 described above to partly repay $3.4 billion of
borrowings made during the second quarter of 2008 to finance a portion of
the Reuters acquisition, and the repayment of the remaining $0.5 billion
of borrowings from available cash.
|
The pro
forma interest coverage ratios also include the effect of the Reuters
acquisition as if it had closed on January 1, 2007. This includes reflecting
interest expense on Reuters short-term indebtedness and long-term debt and the
application of proceeds to repay certain of those obligations. The following
summarizes certain Reuters debt assumed in the acquisition and subsequently
repaid during the second and fourth quarters of 2008. Pro forma interest expense
has been adjusted as if the following repayments of debt assumed from Reuters
had occurred on January 1, 2007:
|
|
—
|
A
revolving credit facility with Ј312 million outstanding, which was repaid
in April 2008;
|
|
|
—
|
£63
million of commercial paper outstanding, which was repaid in the second
quarter of 2008;
|
|
|
—
|
¥1
billion principal amount of bonds, which were repaid in June 2008;
and
|
|
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—
|
€250
million principal amount of floating rate notes, which were repaid in
November 2008.
|
Interest
coverage is equal to net earnings before deducting interest expense (which
include the effect of related debt swaps) and before income taxes, divided by
interest expense.
|
12 Months Ended
|
||||||||
|
December 31,
2007
|
September 30,
2008
|
|||||||
|
Interest
coverage (1)
|
12.5x | (2) | 3.6x | (2) | ||||
|
Interest
coverage excluding the results of discontinued operations (1)
|
3.5x | 3.7x | ||||||
|
Pro
forma interest coverage after giving effect to the acquisition of
Reuters
|
11.1x | (3) | N/A | (4) | ||||
|
Pro
forma interest coverage after giving effect to the acquisition of Reuters
excluding the results of discontinued operations
|
3.6x | (3) | N/A | (4) | ||||
____________
|
(1)
|
These
ratios are based on Thomson Reuters Corporation’s consolidated financial
statements. Other than the inclusion of interest expense related to the
notes issued by Thomson Reuters Corporation in June 2008 and the
application of the net proceeds from the offerings of such notes to repay
borrowings as discussed above, the ratios do not reflect any pro forma
adjustments related to the Reuters
acquisition.
|
|
(2)
|
For
the 12 month period ended December 31, 2007, this ratio includes earnings
from discontinued operations of $2.9 billion, which were primarily
attributable to the sale of our higher education, careers and library
reference business. For the 12 month period ended September 30, 2008,
discontinued operations were not significant to our results of
operations.
|
|
(3)
|
These
ratios are based on the pro forma consolidated financial statements of
Thomson Reuters Corporation set forth in Thomson Reuters PLC’s annual
report on Form 20-F for the year ended December 31, 2007, which is
incorporated by reference in this prospectus. The ratios reflect
adjustments related to interest expense on the notes issued in June 2008
as well as Reuters short-term indebtedness and the Reuters long-term debt
that matured in November 2008, as discussed
above.
|
|
(4)
|
Thomson
Reuters Corporation was not required to prepare pro forma consolidated
financial statements as at and for the nine-month period ended September
30, 2008. Accordingly, ratios for the 12 months ended September 30, 2008
have not been calculated.
|
SHARE
CAPITAL
The
authorized share capital of Thomson Reuters Corporation includes an unlimited
number of common shares and an unlimited number of preference shares, without
par value, issuable in series. As of December 19, 2008, Thomson Reuters
Corporation had outstanding 646,033,729 common shares and 6,000,000 Series
II cumulative redeemable floating rate preference shares.
The
authorized share capital of Thomson Reuters PLC includes 399,950,000 ordinary
shares of Ј0.25 each. As of December 19, 2008, Thomson Reuters PLC had
outstanding 181,229,241 ordinary shares.
In
addition, each of Thomson Reuters Corporation and Thomson Reuters PLC has issued
a Reuters founders share to Reuters Founders Share Company Limited which enables
it to exercise extraordinary voting powers to safeguard the Reuters Trust
Principles, which include the preservation of integrity, reliability of news,
development of the news business and related principles. Each company has also
issued a special voting share to a voting trust so that shareholders of the two
companies can ordinarily vote together as a single decision-making body. Thomson
Reuters Corporation has issued an equalization share to Thomson Reuters PLC in
connection with Thomson Reuters Corporation’s support obligations under the DLC
structure.
DESCRIPTION
OF DEBT SECURITIES
This
section describes certain general terms and provisions of the Debt Securities.
We will provide the particular terms and provisions of a series of Debt
Securities and a description of how the general terms and provisions described
below apply to that series in a prospectus supplement. Thus, for a description
of the terms of a particular series of Debt Securities, you must refer to both
the applicable prospectus supplement relating to that series and the description
of the Debt Securities contained in this prospectus.
Unless
otherwise specified in a prospectus supplement, the Debt Securities will be
issued under a trust indenture dated November 20, 2001, as amended and
supplemented from time to time, between Thomson Reuters Corporation,
Computershare Trust Company of Canada and Deutsche Bank Trust Company Americas.
An indenture is a contract between a financial institution, acting on your
behalf as trustee of the Debt Securities, and us. We collectively refer to
Computershare Trust Company of Canada and Deutsche Bank Trust Company Americas
as the “Trustees” and each Trustee acting in such capacity for a specific series
of Debt Securities as a “Trustee.” The trust indenture is subject to the
provisions of Trust Indenture Legislation.
This
summary information does not purport to be complete and is qualified in its
entirety by reference to the provisions of the Debt Securities and the trust
indenture, including the definition of certain terms in the trust indenture. It
is the trust indenture, and not this summary, that governs the rights of holders
of Debt Securities. Capitalized terms that are used in this section and not
defined have the meanings assigned to them in the trust indenture. We have
defined selected terms at the end of this section. Section references below are
to sections of the trust indenture.
General
The trust
indenture does not limit the amount of Debt Securities that may be issued under
the trust indenture. The trust indenture provides that Debt Securities may be
issued from time to time in one or more series and may be denominated and
payable in U.S. dollars or any other currency. We may offer no more than
US$3,000,000,000 (or the equivalent in non U.S. Currency) aggregate principal
amount of Debt Securities pursuant to this prospectus. The specific terms of any
series of Debt Securities will be established at the time of issuance and will
be described in the applicable prospectus supplement. These terms may include,
but are not limited to, any of the following:
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|
—
|
the
specific designation of the Debt
Securities;
|
|
|
—
|
any
limit on the aggregate principal amount of the Debt
Securities;
|
|
|
—
|
the
date or dates, if any, on which the Debt Securities will mature and the
portion (if other than all of the principal amount) of the Debt Securities
to be payable upon declaration of acceleration of
Maturity;
|
|
|
—
|
the
rate or rates per annum (which may be fixed or variable) at which the Debt
Securities will bear interest, if any, the date or dates from which any
such interest will accrue, the Interest Payment Dates on which any such
interest will be payable and the Regular Record Dates for any interest
payable on the Debt Securities which are in registered
form;
|
|
|
—
|
any
mandatory or optional redemption or sinking fund provisions, including the
period or periods within which, the price or prices at which and the terms
and conditions upon which the Debt Securities may be redeemed or purchased
at our option or otherwise;
|
|
|
—
|
whether
the Debt Securities will be issuable in registered form or bearer form or
both, and, if issuable in bearer form, the restrictions as to the offer,
sale and delivery of the Debt Securities in bearer form and as to
exchanges between registered and bearer
form;
|
|
|
—
|
whether
the Debt Securities will be issuable in the form of one or more registered
global securities and if so the identity of the depository for such
registered global securities;
|
|
|
—
|
the
denominations in which any of the Debt Securities will be issuable if
other than denominations of US$1,000 and any multiple
thereof;
|
|
|
—
|
each
office or agency where the principal of and any premium and interest on
the Debt Securities will be payable and each office or agency where the
Debt Securities may be presented for registration of transfer or
exchange;
|
|
|
—
|
if
other than U.S. dollars, the foreign currency or the units based on or
relating to foreign currencies in which the Debt Securities are
denominated and/or in which the payment of the principal of and any
premium and interest on the Debt Securities will or may be
payable;
|
|
|
—
|
any
index pursuant to which the amount of payments of principal of and any
premium and interest on the Debt Securities will or may be
determined;
|
|
|
—
|
any
other terms of the Debt Securities, including covenants and additional
Events of Default; and
|
|
|
—
|
the
identity of the Trustee for a particular series of Debt Securities.
(Section 301)
|
The trust
indenture also provides that there may be more than one Trustee under the trust
indenture, each with respect to one or more different series of Debt Securities.
See “— Resignation of Trustee” below for more information. As there is more than
one Trustee under the trust indenture, the powers and trust obligations of each
Trustee as described in this prospectus shall extend only to the one or more
series of Debt Securities for which it is Trustee. The Debt Securities (whether
of one or more than one series) for which each Trustee is acting shall in effect
be treated as if issued under separate trust indentures. The term “Debt
Securities” as used in this prospectus shall mean the one or more series with
respect to which each respective Trustee is acting.
Some or
all of the Debt Securities may be issued under the trust indenture as Original
Issue Discount Securities (bearing no interest or interest at a rate that at the
time of issuance is below market rates) to be issued at prices below their
stated principal amounts.
The
general provisions of the trust indenture do not contain any provisions that
would limit our ability to incur indebtedness or that would afford Holders
protection in the event of a highly leveraged or similar transaction involving
Thomson Reuters.
Under the
trust indenture, we will have the ability, in addition to the ability to issue
Debt Securities with terms different from those of other Debt Securities
previously issued, without the consent of the Holders, to reopen a previous
issue of a series of Debt Securities and issue additional Debt Securities of
such series. (Section 301)
Guarantee
Thomson
Reuters Corporation’s obligations under each series of Debt Securities and under
the trust indenture as it relates to such Debt Securities will be fully and
unconditionally guaranteed by Thomson Reuters PLC on an unsecured and
unsubordinated basis. See “Description of Thomson Reuters PLC
Guarantee”.
Ranking
and Other Indebtedness
The Debt
Securities will be unsecured obligations of, and will rank equally with all
other unsecured and unsubordinated obligations of, Thomson Reuters
Corporation.
Form,
Denomination, Exchange and Transfer
Debt
Securities of a series may be issuable solely as registered Debt Securities
issuable in denominations of US$1,000 and integral multiples of US$1,000 or in
such other denominations as may be provided for by the terms of the Debt
Securities of any particular series. The trust indenture also provides that Debt
Securities of a series may be issuable in global form, which we refer to as
Global Securities. Debt Securities of any series will be exchangeable for other
Debt Securities of the same series of any authorized denominations and of a like
aggregate principal amount and tenor. (Section 305)
The Debt
Securities may be presented for exchange as described above, and Debt Securities
may be presented for registration of transfer (duly endorsed or accompanied by a
written instrument of transfer), at the corporate trust office of the Trustee or
at the office of any transfer agent designated by us for such purpose with
respect to any series of Debt Securities. No service charge will be made for any
transfer or exchange of Debt Securities, but we may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. We may at any time designate one or more successor or additional
transfer agents with respect to any series of Debt Securities and may from time
to time rescind any such designation. (Section 305) We will be required to
maintain a transfer agent in each Place of Payment for such series. (Section
1002)
So long
as required by the Business
Corporations Act (Ontario), we shall cause to be kept, by Thomson Reuters
Corporation or a trust corporation registered in Ontario, a central securities
register that complies with the requirements of the Business Corporations Act (Ontario).
Additionally, we will cause to be recorded promptly in the central securities
register maintained pursuant to the Business Corporations Act
(Ontario), the particulars of each issue, exchange or transfer of Debt
Securities. Unless otherwise provided for in the case of any series of Debt
Securities, the Trustee shall maintain at its corporate trust office a branch
register containing the same information with respect to each entry contained
therein as contained in the central register. In the event of a conflict between
the information contained in the central register and the information contained
in a branch register, the information contained in the central register shall
prevail. (Section 305)
We shall
not be required to:
|
|
—
|
issue,
register the transfer of or exchange Debt Securities of any series during
a period beginning at the opening of business 15 days before any selection
of Debt Securities of that series to be redeemed and ending at the close
of business on the day of mailing of the relevant notice of
redemption;
|
|
|
—
|
register
the transfer of or exchange any Debt Security, or portion thereof, called
for redemption, except the unredeemed portion of any Debt Security being
redeemed in part; or
|
|
|
—
|
issue,
register the transfer of or exchange any Debt Security which has been
surrendered for repayment at the option of the Holder except the portion,
if any, of such Debt Security not to be so repaid. (Section
305)
|
Events
of Default
The trust
indenture provides, with respect to any series of Outstanding Debt Securities
thereunder, that the following shall constitute Events of Default:
|
|
(i)
|
default
in the payment of any interest upon any Debt Security of that series, when
the same becomes due and payable, continued for 30
days;
|
|
|
(ii)
|
default
in the payment of the principal of or any premium on any Debt Security of
that series at its Maturity;
|
|
(iii)
|
default
in the deposit of any sinking fund or analogous payment when due by the
terms of any Debt Security of that
series;
|
|
(iv)
|
default
in the performance, or breach, of any of our covenants or warranties in
the trust indenture (other than a covenant or warranty, a default in whose
performance or whose breach is specifically dealt with elsewhere in the
trust indenture), continued for 60 days after written notice to
us;
|
|
|
(v)
|
certain
events of bankruptcy, insolvency or reorganization;
and
|
|
(vi)
|
any
other Event of Default provided with respect to the Debt Securities of
that series. (Section 501)
|
No Event
of Default provided with respect to a particular series of Debt Securities
necessarily constitutes an Event of Default with respect to any other series of
Debt Securities. (Section 501) We are required to file with the Trustee,
annually, an Officer’s Certificate as to our compliance with all conditions and
covenants under the trust indenture. (Section 1004) The trust indenture provides
that the Trustee may withhold notice to the Holders of Debt Securities of any
default (except payment defaults on the Debt Securities) if it considers it in
the best interest of the Holders of Debt Securities to do so. (Section
502)
If an
Event of Default listed in clause (i), (ii), (iii), (iv) or (vi) of the second
preceding paragraph with respect to Debt Securities of a particular series
occurs and is continuing, the Trustee or the Holders of not less than 25% in
principal amount of Outstanding Debt Securities of that series may declare the
Outstanding Debt Securities of that series due and payable immediately. If an
Event of Default listed in clause (v) of the preceding paragraph occurs and is
continuing, then the Trustee or the Holders of not less than 25% in principal
amount of all Debt Securities then Outstanding may declare the principal amount
of all of the Outstanding Debt Securities to be due and payable immediately.
However, in either case the Holders of a majority in principal amount of the
Outstanding Debt Securities of that series, or of all Outstanding Debt
Securities, as the case may be, by written notice to us and the Trustee, may,
under certain circumstances, rescind and annul such declaration. (Section
503)
Subject
to the provisions relating to the duties of the Trustee, in case an Event of
Default with respect to Debt Securities of any or all series occurs and is
continuing, the Trustee shall be under no obligation to exercise any of its
rights or powers under the trust indenture at the request, order or direction of
any of the Holders of such Debt Securities, unless such Holders shall have
offered to the Trustee reasonable indemnity against the expenses and liabilities
which might be incurred by it in compliance with such request. (Section 508)
Subject to such provisions for the indemnification of the Trustee, the Holders
of not less than a majority in principal amount of the Outstanding Debt
Securities of any series (with respect to any remedy, trust or power relating to
or arising under an Event of Default described in clause (i), (ii), (iii), (iv)
or (vi) above) or the Holders of a majority in principal amount of all
Outstanding Debt Securities (with respect to any other remedy, trust or power),
as the case may be, shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee under the
trust indenture, or exercising any trust or power conferred on the Trustee.
(Section 513)
The
Holders of not less than a majority in principal amount of the Outstanding Debt
Securities of any series may on behalf of the Holders of all the Debt Securities
of such series waive any past default described in clause (i), (ii), (iii), (iv)
or (vi) above (or, in the case of a default described in clause (v) above, the
Holders of not less than a majority in principal amount of all Outstanding Debt
Securities may waive any such past default) and its consequences, except a
default (a) in the payment of the principal of (or premium, if any) or any
interest on any Debt Security, or (b) in respect of a covenant or provision that
cannot be modified or amended without the consent of the Holder of each
Outstanding Debt Security of such series affected thereby. (Section
514)
Negative
Pledge
The trust
indenture provides that, so long as any Debt Securities are Outstanding, we will
not:
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—
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create
or permit to subsist after knowledge of the existence thereof any
mortgage, lien, pledge, encumbrance, conditional sale or other title
retention agreement, or other similar security interest, or Security
Interest, upon any part of any undertaking or assets to secure any of our
Debt; or
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—
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permit
any Material Subsidiary to give any Guarantee to secure any of our
Debt;
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without
at the same time or as soon as reasonably practicable thereafter according to
the Holders of Debt Securities a ratable and pari passu interest in the
same Security Interest or Guarantee, as applicable, but this covenant will not
apply to, or operate to prevent:
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(i)
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any
Security Interest for, or any Guarantee by a Material Subsidiary of, any
of our Debt, the amount of which, when aggregated with the amount of all
of our other Debt then outstanding in respect of which Security Interest
or a Guarantee by a Material Subsidiary has been given, excluding any
Security Interest or Guarantee given pursuant to the exceptions in
subparagraphs (ii) to (iv), would not exceed 10% of Consolidated
Shareholders’ Equity;
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(ii)
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any
Security Interest on (a) any asset (including shares) acquired or held by
us to secure our Debt incurred solely for the purpose of financing the
acquisition, construction, research, development or improvement of such
asset or (b) shares of a Subsidiary organized solely to acquire any such
asset;
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(iii)
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the
assumption by us of any Security Interest in existence on any asset at the
time of acquisition thereof, including any such assumption consequent upon
any amalgamation, merger, arrangement or other corporate
reorganization;
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(iv)
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our
giving a Security Interest (other than on shares or fixed assets) in the
ordinary course of our business to any bank or banks or others to secure
any of our Debt that is not a Funded Obligation;
or
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(v)
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the
extension, renewal or refunding of any Security Interest permitted under
subparagraphs (ii) to (iv) to the extent of the principal amount of our
Debt secured by and owing under any such Security Interest at the time of
such extension, renewal or refunding. (Section
1007)
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Modification
and Waiver
We and
the Trustee may modify and amend the trust indenture with the consent of the
Holders of not less than a majority in principal amount of all Outstanding Debt
Securities that are affected by such modification or amendment; provided that no
such modification or amendment may, without the consent of the Holder of each
Outstanding Debt Security affected thereby, among other things:
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—
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change
the Stated Maturity of, the principal of (or premium, if any), or any
installment of interest on any such Debt
Security;
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—
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reduce
the principal amount or the rate of interest on or any premium payable on
any Debt Security;
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—
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change
our obligation to pay Additional Amounts provided for pursuant to Section
1005 of the trust indenture, with certain
exceptions;
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—
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reduce
the amount of the principal of an Original Issue Discount Security that
would be due and payable upon a declaration of acceleration of the
Maturity thereof;
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—
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adversely
affect any right of repayment at the option of the Holder of any such Debt
Security;
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—
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change
the Currency or Place of Payment of principal of, or any premium or
interest on, any such Debt
Security;
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—
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reduce
the above-stated percentage of Holders of such Outstanding Debt Securities
necessary to modify or amend the trust indenture or to consent to any
waiver thereunder (including a waiver of certain defaults);
or
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—
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modify
the foregoing requirements with certain exceptions. (Section
902)
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The
Holders of a majority in principal amount of Outstanding Debt Securities
affected thereby have the right to waive compliance by us with certain
covenants. (Section 1008)
We and
the Trustee may modify and amend the trust indenture without the consent of any
Holder, for any of the following purposes:
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—
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to
evidence the succession of another Person to Thomson Reuters Corporation
as obligor under the trust
indenture;
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—
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to
add to our covenants for the benefit of the Holders of all or any series
of Debt Securities;
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—
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to
add additional Events of Default for the benefit of the Holders of all or
any series of Debt Securities;
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—
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to
add, change or eliminate any provisions of the trust indenture, provided
that any such addition, change or elimination shall become effective only
when there are no Debt Securities Outstanding of any series created prior
thereto which are entitled to the benefit of such provision or any such
addition, change or elimination shall not apply to any Outstanding Debt
Security;
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—
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to
secure the Debt Securities pursuant to the provisions described above
under “— Negative Pledge” and “— Merger, Consolidation or Amalgamation,”
or otherwise;
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—
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to
establish the form or terms of Debt Securities of any
series;
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—
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to
provide for the acceptance of appointment by a successor Trustee or
facilitate the administration of the trusts under the trust indenture by
more than one Trustee;
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—
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to
cure any ambiguity, defect or inconsistency in the trust indenture,
provided such action does not adversely affect the interests of Holders of
Debt Securities of any series in any material
respect;
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—
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to
supplement any of the provisions of the trust indenture to the extent
necessary to permit or facilitate defeasance and discharge of any series
of Debt Securities, provided, however, such action shall not adversely
affect the interests of the Holders of any Debt Securities in any material
respect; or
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—
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to
comply with Trust Indenture Legislation, provided such action does not
adversely affect the interests of Holders of Debt Securities of any series
in any material respect. (Section
901)
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The trust
indenture provides that in determining whether the Holders of the requisite
principal amount of Debt Securities of a series then Outstanding have given any
request, demand, authorization, direction, notice, consent or waiver
thereunder:
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—
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the
principal amount of an Original Issue Discount Security that shall be
deemed to be Outstanding shall be the amount of the principal thereof that
would be due and payable as of the date of such determination upon
acceleration of the maturity
thereof;
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—
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the
principal amount of a Debt Security denominated in a Currency or
Currencies other than U.S. dollars shall be the U.S. dollar equivalent,
determined as of the date such Debt Securities were originally issued, of
the principal amount (or, in the case of an Original Issue Discount
Security, the U.S. dollar equivalent on the issue date of such Original
Issue Discount Security of the amount determined as provided in the first
bullet above); and
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—
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Debt
Securities owned by us or any other obligor or affiliate of ours or such
other obligor shall be disregarded and not deemed to be Outstanding.
(Section 101)
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Merger,
Consolidation or Amalgamation
The trust
indenture provides that Thomson Reuters Corporation may not amalgamate or
consolidate with or merge into any other Person and that it may not convey,
transfer, sell or lease its properties and assets substantially as an entirety
to any Person, unless:
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—
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the
Person formed by such consolidation or amalgamation or into which Thomson
Reuters Corporation is merged or the Person which acquires or leases its
properties and assets substantially as an entirety is organized or
existing under the laws of any Canadian, United States, United Kingdom or
other country that is in the European Community jurisdiction expressly
assumes its obligations under the Debt Securities and the trust indenture,
and
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—
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certain
other conditions are met. (Section
801)
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In
addition, no such amalgamation, consolidation, merger or transfer may be made
if, as a result thereof, any of Thomson Reuters Corporation’s property or assets
would become subject to any mortgage or other encumbrance securing Debt, unless
such mortgage or other encumbrance could be created pursuant to the provisions
described under “— Negative Pledge” above without equally and ratably securing
the Debt Securities or unless the Debt Securities are secured equally and
ratably with, or prior to, the Debt secured by such mortgage or other
encumbrance. (Section 803)
Under the
DLC structure, the capital of Thomson Reuters is deployed and managed in a way
which the Thomson Reuters board considers most beneficial to Thomson Reuters.
Assets of Thomson Reuters are owned, directly or indirectly, by whichever of
Thomson Reuters Corporation or Thomson Reuters PLC is determined to be most
efficient and appropriate under the then prevailing circumstances. Thomson
Reuters assets may accordingly be owned, directly or indirectly, from time to
time by Thomson Reuters Corporation or Thomson Reuters PLC, or by the two
companies. Under the DLC structure, transfers of assets within Thomson Reuters
may be made from time to time. Such transfers are considered to be in the
ordinary course of business and may be made without the approval of shareholders
or compliance with these provisions.
Discharge,
Defeasance and Covenant Defeasance
We may
discharge certain obligations to Holders of any series of Debt Securities issued
under the trust indenture which have not already been delivered to the Trustee
for cancellation and which have either become due and payable or are by their
terms due and payable within one year (or scheduled for redemption within one
year) by irrevocably depositing with the Trustee trust funds in an amount
sufficient to pay the entire indebtedness on such Debt Securities for principal
(and premium, if any) and interest to the date of such deposit (if such Debt
Securities have become due and payable) or to the Stated Maturity or Redemption
Date, as the case may be. (Section 401)
We may,
at our option and at any time, elect to have our obligations discharged with
respect to the Outstanding Debt Securities of or within any series, which we
refer to as defeasance. Defeasance means that we shall be deemed to have paid
and discharged the entire indebtedness represented by such Outstanding Debt
Securities and to have satisfied our other obligations under the trust indenture
with respect to such Debt Securities, except for:
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—
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the
rights of Holders of such Outstanding Debt Securities to receive solely
from the trust fund described below payments in respect of the principal
of (and premium, if any) and interest on such Debt Securities when such
payments are due;
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—
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our
obligations with respect to such Debt Securities relating to the issuance
of temporary securities, the registration, transfer and exchange of the
Debt Securities, the replacement of mutilated, destroyed, lost or stolen
Debt Securities, the maintenance of an office or agency in the applicable
Place of Payment, the holding of money for security payments in trust and
with respect to the payment of Additional Amounts, if any, pursuant to
Section 301 of the trust indenture;
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—
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the
rights, powers, trusts, duties and immunities of the Trustee;
and
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—
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the
defeasance provisions of the trust
indenture.
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We may,
at our option and at any time, elect to be released from our obligations with
respect to certain covenants that are described in the trust indenture
(including those described under “— Negative Pledge” and “— Merger,
Consolidation or Amalgamation” above), and we refer to this as “covenant
defeasance,” and any omission to comply with such obligations thereafter shall
not constitute a default or an Event of Default with respect to such Debt
Securities. (Sections 1401, 1402 and 1403)
In order
to exercise either defeasance or covenant defeasance:
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—
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we
must irrevocably deposit with the Trustee (or other qualifying trustee),
in trust, for the benefit of the Holders of such Debt Securities, cash,
Government Obligations, or a combination thereof, in such amounts as will
be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of (and premium, if
any) and interest on such Outstanding Debt Securities, and any mandatory
sinking fund or analogous payments thereon, on the scheduled due dates
therefor in the Currency in which such Debt Securities are then specified
as payable at Stated Maturity;
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—
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in
the case of defeasance, we shall have delivered to the Trustee an Opinion
of Counsel qualified to practice law in the United States stating that (x)
we have received from, or there has been published by, the Internal
Revenue Service a ruling or (y) since the date of the trust indenture,
there has been a change in the applicable United States federal income tax
law, in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of such Debt Securities will not
recognize income, gain or loss for United States federal income tax
purposes as a result of such defeasance and will be subject to United
States federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such defeasance had not
occurred;
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—
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in
the case of covenant defeasance, we shall have delivered to the Trustee an
Opinion of Counsel qualified to practice law in the United States to the
effect that the Holders of such Debt Securities will not recognize income,
gain or loss for United States federal income tax purposes as a result of
such covenant defeasance and will be subject to United States federal
income tax on the same amounts, in the same manner and at the same times
as would have been the case if such covenant defeasance had not
occurred;
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—
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in
the case of defeasance or covenant defeasance, we shall have delivered to
the Trustee an Opinion of Counsel qualified to practice law in Canada or a
ruling from the Canada Revenue Agency to the effect that Holders of such
Outstanding Securities will not recognize income, gain or loss for
Canadian federal or provincial income tax or other tax purposes as a
result of such defeasance or covenant defeasance, as applicable, and will
be subject to Canadian federal or provincial income tax and other tax
including withholding tax, if any, on the same amounts, in the same manner
and at the same times as would have been the case if such defeasance or
covenant defeasance had not occurred;
and
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—
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we
have delivered to the Trustee an Opinion of Counsel to the effect that the
deposit referenced in the first bullet above will not cause the Trustee or
the trust so created to be subject to the U.S. Investment Company Act of
1940, as amended, and that we are not an “insolvent person” within the
meaning of the Bankruptcy and Insolvency Act, on the date of the deposit
referred to in the first bullet above or at any time during the period
ending on the 91st day after the date of such deposit. (Section
1404)
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If, after
we have deposited funds and/or Government Obligations to effect defeasance or
covenant defeasance with respect to any Debt Securities:
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—
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the
Holder of any such Debt Security is entitled to, and does, elect pursuant
to the terms of such Debt Security to receive payment in a Currency other
than that in which such deposit has been made in respect of such Debt
Security, or
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—
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the
Currency in which such deposit has been made in respect of any such Debt
Security ceases to be used by its government of issuance, the indebtedness
represented by such Debt Security shall be deemed to have been, and will
be, fully discharged and satisfied through the payment of the principal of
(and premium, if any) and interest, if any, on such Debt Security as they
become due out of the proceeds yielded by converting the amount so
deposited in respect of such Debt Security into the Currency in which such
Debt Security becomes payable as a result of such election or such
cessation of usage based on the applicable Market Exchange Rate. (Section
1405)
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All
payments of principal of (and premium, if any), and interest, if any, on any
Debt Security that is payable in a Currency other than U.S. dollars that ceases
to be used by its government of issuance shall be made in U.S. dollars. (Section
312)
Payment
of Principal and Interest and Paying Agents
Unless
otherwise specified in Section 301 of the trust indenture, principal (premium,
if any) and interest, if any, on Debt Securities will be payable at an office or
agency maintained by us in New York, New York, except that at our option,
interest, if any, may be paid by:
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—
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check
mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register, or
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—
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wire
transfer to an account located in the United States or Canada maintained
by the person entitled thereto as specified in the Security Register.
(Sections 307, 1001 and 1002)
|
Payment
of any installment of interest on Debt Securities will be made to the Person in
whose name such Debt Security is registered at the close of business on the
Regular Record Date for such interest. (Section 307)
Any
Paying Agent outside the United States and any other Paying Agent in the United
States initially designated by us for the Debt Securities may be established for
each series of Debt Securities. We may at any time designate additional Paying
Agents or rescind the designation of any Paying Agent or approve a change in the
office through which any Paying Agent acts, except that we will be required to
maintain a Paying Agent in each Place of Payment for such series. (Section
1002)
Resignation
of Trustee
The
Trustee may resign or be removed with respect to one or more series of Debt
Securities and a successor Trustee may be appointed to act with respect to such
series. (Section 608) In the event that two or more persons are acting as
Trustee with respect to different series of Debt Securities, each such Trustee
shall be a Trustee of a trust under the trust indenture separate and apart from
the trust administered by any other such Trustee (Section 609), and any action
described herein to be taken by the “Trustee” may then be taken by each such
Trustee with respect to, and only with respect to, the one or more series of
Debt Securities for which it is Trustee.
Book-Entry
Debt Securities
The Debt
Securities of a series may be issued in whole or in part in the form of one or
more Global Securities that will be deposited with, or on behalf of, a
depositary for a series of Debt Securities. Global Securities may be issued in
either temporary or permanent form. Unless otherwise provided for a series of
Debt Securities, Debt Securities that are represented by a Global Security will
be issued in denominations of US$1,000 and any integral multiple thereof or in
such other denominations as may be provided for by the terms of the Debt
Securities of any particular series, and will be issued in registered form only,
without coupons. Payments of principal of (premium, if any) and interest on Debt
Securities represented by a Global Security will be made by the Trustee to the
depositary or its nominee.
Governing
Law
The trust
indenture and the Debt Securities will be governed by, and construed in
accordance with, the laws of the State of New York. The trust indenture is
subject to the provisions of the Trust Indenture Legislation and shall, to the
extent applicable, be governed by such provisions. (Section 111)
Agent
for Service of Process
The trust
indenture, as currently amended and supplemented, provides that we have
designated our subsidiary, Thomson Reuters Holdings Inc., 3 Times Square, New
York, New York 10036, as our authorized agent for service of process in any
suit, action or proceeding arising out of or relating to the trust indenture and
the Debt Securities that may be instituted in any federal or state court located
in the Borough of Manhattan, in the City of New York, or brought under United
States federal or state securities laws or brought by the Trustee, and we have
irrevocably submitted to the jurisdiction of such courts. (Section
113)
Definitions
Set forth
below is a summary of certain of the defined terms used in the trust indenture.
Reference is made to the trust indenture for the full definition of all such
terms, as well as any other terms used herein for which no definition is
provided. (Section 101)
“Business Day,” when used
with respect to any Place of Payment or any other location referred to in the
trust indenture, expressly or impliedly, which shall include Toronto, Ontario,
New York, New York and London, England, hereunder, or in the Debt Securities,
means, unless otherwise specified with respect to any Debt Securities pursuant
to Section 301, each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in that Place of Payment or other such
location are authorized or obligated by law or executive order to
close.
“Consolidated Shareholders’ Equity”
means the aggregate of the stated capital accounts for all of our
outstanding shares and the amount of our consolidated surplus, whether paid in,
earned, or otherwise, as such consolidated surplus is shown on the then most
recent audited consolidated balance sheet of Thomson Reuters Corporation,
determined in accordance with GAAP.
“Debt” means notes, bonds,
debentures or other similar evidences of indebtedness for money
borrowed.
“Funded Obligation” means any
Debt, the principal amount of which by its terms is not payable on demand and
the due date of payment of which, after giving effect to any right of extension
or renewal exercisable unilaterally on the part of the obligor, is more than 18
months from the date of the creation, issue or incurring of the
same.
“GAAP” means generally
accepted accounting principles which are in effect from time to time in Canada
(or, if we hereafter determine to prepare our principal consolidated financial
statements in accordance with generally accepted accounting principles which are
in effect from time to time in the United States, such principles).
“Guarantee” means any
guarantee, indemnity or similar obligation.
“Material Subsidiary” means
any Subsidiary the sales of which for the 12 months ending at the end of the
most recently completed fiscal year of such Subsidiary represent 5% or more of
the sales of Thomson Reuters taken as a whole for the 12 months ending at the
end of our most recently completed fiscal year, or the gross assets of which as
at the end of the most recently completed fiscal year of such Subsidiary
represent 5% or more of the gross assets of Thomson Reuters taken as a whole as
at the end of our most recently completed fiscal year, calculated in each case
in accordance with GAAP.
“Subsidiary” means any
corporation of which at the time of determination Thomson Reuters Corporation,
directly and/or indirectly through one or more Subsidiaries, owns more than 50%
of the shares of Voting Stock of such corporation. For so long as the DLC
structure is in effect, Thomson Reuters PLC will be deemed to be a Subsidiary
for the purposes of the trust indenture.
“Trust Indenture Act” or
“TIA” means the Trust
Indenture Act of 1939, as amended as in force at the date as of which a trust
indenture was executed, except as provided in Section 905 of the trust
indenture.
“Trust Indenture Legislation”
means, at any time, statutory provisions relating to trust indentures and
the rights, duties, and obligations of trustees under trust indentures and of
corporations issuing debt obligations under trust indentures to the extent that
such provisions are at such time in force and applicable to the trust indenture,
and at the date of the trust indenture means (i) in respect of Debt Securities
offered solely in Canada and not concurrently in the United States, the
applicable provisions of the Business Corporations Act
(Ontario) and the regulations thereunder as amended or re-enacted from
time to time, and (ii) in respect of Debt Securities offered solely in the
United States and not concurrently in Canada or offered concurrently in the
United States and Canada, the Trust Indenture Act and regulations
thereunder.
“Voting Stock” means stock of
the class or classes having general voting power under ordinary circumstances to
elect at least a majority of the board of directors, managers or trustees of a
corporation (irrespective of whether or not at the time stock of any other class
or classes shall have or might have voting power by reason of the happening of
any contingency). (Section 101)
DESCRIPTION
OF THOMSON REUTERS PLC GUARANTEE
In
connection with the implementation of the DLC structure, Thomson Reuters
Corporation and Thomson Reuters PLC entered into reciprocal deeds of guarantee
for the benefit of each other’s creditors. This section describes certain
general terms and provisions of the Thomson Reuters PLC deed of guarantee. This
summary information does not purport to be complete and is qualified in its
entirety by reference to the provisions of the Thomson Reuters PLC deed of
guarantee. It is the Thomson Reuters PLC deed of guarantee, and not this
summary, that defines the rights of Holders of Debt Securities under the Thomson
Reuters PLC deed of guarantee. Capitalized terms that are used in this section
and not defined have the meanings assigned to them in the trust
indenture.
Obligations
Guaranteed
Under the
Thomson Reuters PLC deed of guarantee, Thomson Reuters PLC has unconditionally
and irrevocably undertaken and promised to Thomson Reuters Corporation that it
will, as a continuing obligation, make to the creditors to whom or to which it
is owed the proper and punctual payment of each of the following obligations,
subject to certain exceptions, following written demand on the relevant primary
obligor, if for any reason Thomson Reuters Corporation does not make such
payment on the relevant due date:
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—
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any
contractual obligations of Thomson Reuters
Corporation;
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—
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any
contractual obligations of certain other persons, referred to as principal
debtors, which are guaranteed by Thomson Reuters Corporation;
and
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—
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other
obligations of Thomson Reuters Corporation or any principal debtor of any
kind which may be agreed to in writing between Thomson Reuters PLC and
Thomson Reuters Corporation. No such obligation has, at the date of this
prospectus, been so agreed.
|
The
Thomson Reuters PLC deed of guarantee provides that the creditors to whom
Thomson Reuters Corporation’s obligations are owed are intended to be third
party beneficiaries of the guarantee who may, in accordance with the UK Contracts (Rights of Third Parties) Act 1999,
enforce the guarantee directly.
Should
any obligation not be recoverable from Thomson Reuters PLC under the terms of
the Thomson Reuters PLC deed of guarantee as a result of the obligation becoming
void, voidable or unenforceable against Thomson Reuters Corporation, Thomson
Reuters PLC will, as sole, original and independent obligor, make payment on
such obligation by way of a full indemnity. Unless otherwise provided in the
Thomson Reuters PLC deed of guarantee, Thomson Reuters PLC’s liabilities and
obligations under the guarantee will remain in force notwithstanding any act,
omission, neglect, event or matter which would not affect or discharge the
liabilities of Thomson Reuters Corporation owed to the relevant creditor,
including without limitation:
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—
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anything
which would have discharged Thomson Reuters PLC (wholly or in part) but
not Thomson Reuters Corporation;
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—
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anything
which would have offered Thomson Reuters PLC (but not Thomson Reuters
Corporation) any legal or equitable defense;
and
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—
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any
winding-up, insolvency, dissolution and/or analogous proceeding of, or any
change in constitution or corporate identity or loss of corporate identity
by, Thomson Reuters Corporation or any other person or
entity.
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In the
event that Thomson Reuters PLC is required to make any payment to any creditor
under the Thomson Reuters PLC deed of guarantee, Thomson Reuters Corporation
will reimburse Thomson Reuters PLC for those payments.
Exclusion
of Obligations
Thomson
Reuters PLC may at any time, with the agreement of Thomson Reuters Corporation,
exclude obligations of a particular type, or a particular obligation or
obligations, incurred after a specified future time from the scope of the
Thomson Reuters PLC deed of guarantee.
However,
no such agreement or exclusion will be effective with respect to any obligation
incurred before, or arising out of, any credit or similar facility in effect at
the time at which the relevant agreement or exclusion becomes effective.
Therefore, Thomson Reuters Corporation and Thomson Reuters PLC would not be able
to exclude a series of Debt Securities or the trust indenture as it relates to
such Debt Securities from the scope of the Thomson Reuters PLC deed of guarantee
after the issuance of such Debt Securities without the consent of the Trustee
and the requisite Holders of the relevant Debt Securities.
No
Defense, Set-Off and Counterclaim
In
respect of any claim against Thomson Reuters PLC by a creditor under the Thomson
Reuters PLC deed of guarantee, Thomson Reuters PLC will not have available to
it:
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—
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by
way of defense or set-off, any matter that arises from or in connection
with the Thomson Reuters PLC deed of guarantee, and which would have been
available to Thomson Reuters PLC by way of defense or set-off if the
proceedings had been brought against Thomson Reuters PLC by Thomson
Reuters Corporation;
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—
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by
way of defense or set-off, any matter that would have been available to it
by way of defense or set-off against the creditor if the creditor had been
a party to the Thomson Reuters PLC deed of guarantee;
or
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—
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by
way of counterclaim, any matter not arising from the Thomson Reuters PLC
deed of guarantee that would have been available to it by way of
counterclaim against the creditor if the creditor had been a party to the
Thomson Reuters PLC deed of
guarantee.
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Governing
Law and Jurisdiction
The
Thomson Reuters PLC deed of guarantee is governed by, and construed in
accordance with, the laws of England. The courts of England and Wales have
exclusive jurisdiction to settle any dispute in connection with the Thomson
Reuters PLC deed of guarantee. The governing law of the Thomson Reuters PLC deed
of guarantee will not affect the governing law of any Debt Securities or the
trust indenture, which will continue to be governed by the laws of the State of
New York. It is therefore likely that the governing law and the jurisdiction in
which actions may be brought in respect of the Thomson Reuters PLC deed of
guarantee will be different from those for the Debt Securities. See “Risk
Factors — Risks Relating to the Thomson Reuters PLC Guarantee”.
Termination
No
termination of the Thomson Reuters PLC deed of guarantee will be effective with
respect to any obligation under the Thomson Reuters PLC deed of guarantee
incurred before, or arising out of, any credit or similar facility in effect at
the time at which the termination becomes effective. Therefore, after the
issuance of a series of Debt Securities, the termination provisions described
below will not apply to such Debt Securities without the consent of the Trustee
and the requisite Holders of the relevant Debt
Securities.
Subject
to that limitation, the Thomson Reuters PLC deed of guarantee automatically
terminates if:
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—
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the
equalization and governance agreement entered into between Thomson Reuters
Corporation and Thomson Reuters PLC in connection with the implementation
of the DLC structure terminates or otherwise ceases to have
effect;
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—
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the
reciprocal Thomson Reuters Corporation deed of guarantee terminates or
otherwise ceases to have effect; or
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—
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a
resolution is passed or an order is made for the liquidation of Thomson
Reuters Corporation.
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Amendment
No
amendment of the Thomson Reuters PLC deed of guarantee will be effective with
respect to any obligation under the Thomson Reuters PLC deed of guarantee
incurred before, or arising out of, any credit or similar facility in effect at
the time at which the amendment becomes effective. Therefore, after the issuance
of a series of Debt Securities, the amendment provisions described below will
not apply to such Debt Securities without the consent of the Trustee and the
requisite Holders of the relevant Debt Securities.
Subject
to that limitation, any amendments to the Thomson Reuters PLC deed of guarantee
which are formal or technical in nature and which are not materially prejudicial
to the interests of the shareholders of either Thomson Reuters Corporation or
Thomson Reuters PLC or are necessary to correct any inconsistency or manifest
error may be agreed between Thomson Reuters PLC and Thomson Reuters Corporation.
Any other amendment to the Thomson Reuters PLC deed of guarantee requires
approval of the shareholders of each company voting separately as a
class.
PLAN
OF DISTRIBUTION
We may
sell the Debt Securities:
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through
underwriters or dealers;
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directly
to one or more purchasers; or
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through
agents.
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We may
sell Debt Securities at fixed prices or at non-fixed prices, such as prices
determined by reference to the prevailing price of the specified securities in a
specified market, at market prices prevailing at the time of sale or at prices
to be negotiated with purchasers, which prices may vary as between purchasers
and during the period of distribution of the securities. The applicable
prospectus supplement will set forth the terms of the offering of the Debt
Securities including the name or names of any underwriters, the purchase price
of such Debt Securities and the proceeds to us from such sale, any underwriting
discounts and other items constituting underwriters’ compensation, any public
offering price and any discounts or concessions allowed or reallowed or paid to
dealers. Only underwriters so named in the prospectus supplement are deemed to
be underwriters in connection with the Debt Securities offered
thereby.
If
underwriters are used in the sale, the Debt Securities may be acquired by the
underwriters for their own account and may be resold from time to time in one or
more transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. The obligations of
the underwriters to purchase such Debt Securities will be subject to certain
conditions precedent, and the underwriters will be obligated to purchase all the
Debt Securities of the series offered through the applicable prospectus
supplement if any of such Debt Securities are purchased. Any public offering
price and any discounts or concessions allowed or reallowed or paid to dealers
may be changed from time to time.
We may
also sell Debt Securities directly at such prices and upon such terms as agreed
to by us and the purchaser or through agents designated by us from time to time.
Any agent involved in the offering and sale of the Debt Securities in respect of
which this prospectus is delivered will be named, and any commissions payable by
us to such agent will be set forth, in the prospectus supplement. Unless
otherwise indicated in the prospectus supplement, any agent is acting on a best
efforts basis for the period of its appointment.
We may
agree to pay the underwriters a commission for various services relating to the
issue and sale of the Debt Securities offered hereby.
In
connection with any offering of the Debt Securities, the underwriters or agents
may over-allot or effect transactions which stabilize or maintain the market
price of the Debt Securities offered at a level above that which might otherwise
prevail in the open market. These transactions, if commenced, may be
discontinued at any time.
Underwriters,
dealers and agents who participate in the distribution of the Debt Securities
may be entitled under agreements to be entered into with us to indemnification
by us against certain liabilities, including liabilities under securities
legislation, or to contribution with respect to payments which such
underwriters, dealers or agents may be required to make in respect thereof.
These underwriters, dealers and agents may be customers of, engage in
transactions with or perform services for us in the ordinary course of
business.
Each
series of the Debt Securities will be a new issue of securities with no
established trading market. Unless otherwise specified in an applicable
prospectus supplement relating to a series of Debt Securities, the Debt
Securities will not be listed on any securities or stock exchange or on any
automated dealer quotation system. Some broker-dealers may make a market in the
Debt Securities, but they will not be obligated to do so and may discontinue any
market-making activities at any time without notice. There may not be a trading
market for the Debt Securities and no assurances can be given as to the
liquidity of the trading market, if any, for the Debt Securities. See “Risk
Factors.”
CERTAIN
INCOME TAX CONSIDERATIONS
The
applicable prospectus supplement will describe the material Canadian federal
income tax consequences to an investor who is not a resident of Canada (for
purposes of the Income Tax Act
(Canada)) of acquiring Debt Securities, including whether payment of
principal (premium, if any), and interest, if any, on the Debt Securities, will
be subject to Canadian non-resident withholding tax.
A
prospectus supplement may also describe any material U.S. federal income tax
consequences of the acquisition, ownership and disposition of Debt Securities by
an initial investor who is a U.S. person (within the meaning of the U.S.
Internal Revenue Code), including, to the extent applicable, any such
consequences relating to Debt Securities payable in a currency other than U.S.
dollars, issued at an original issue discount for U.S. federal income tax
purposes or containing any early redemption provisions or other special
terms.
LEGAL
MATTERS
Unless
otherwise specified in a prospectus supplement, certain legal matters relating
to the Debt Securities offered by this prospectus will be passed upon on our
behalf by Torys LLP (regarding Canadian and U.S. matters) and by Allen &
Overy LLP (regarding English matters). As of December 19, 2008, the partners and
associates of each of Torys LLP and Allen & Overy LLP beneficially owned,
directly or indirectly, less than 1% of our outstanding shares.
EXPERTS
The
consolidated financial statements and management’s assessment of the
effectiveness of internal control over financial reporting (which is included in
Management’s Report on Internal Control over Financial Reporting) of Thomson
Reuters Corporation (formerly, The Thomson Corporation) incorporated by
reference in this prospectus have been so incorporated in reliance on the report
of PricewaterhouseCoopers LLP, Toronto, Canada, independent auditors, given on
the authority of said firm as experts in auditing and accounting.
The
consolidated financial statements and management’s assessment of the
effectiveness of internal control over financial reporting (which is included in
Management’s Report on Internal Control over Financial Reporting) of Reuters
incorporated in this prospectus by reference to Thomson Reuters PLC’s Annual
Report on Form 20-F for the year ended December 31, 2007 have been so
incorporated in reliance on the report of PricewaterhouseCoopers LLP, London,
United Kingdom, an independent registered public accounting firm, given on the
authority of said firm as experts in auditing and accounting.
The
consolidated financial statements of Reuters Group PLC (now known as Reuters
Group Limited) incorporated in this prospectus by reference to Thomson Reuters
Corporation’s Business Acquisition Report filed on Form 6-K dated May 15, 2008
have been so incorporated in reliance on the report of PricewaterhouseCoopers
LLP, London, United Kingdom, an independent registered public accounting firm,
given on the authority of said firm as experts in auditing and
accounting.
DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT
The
following documents have been filed with the SEC as part of the registration
statement on Form F-9 and Form F-3 of which this prospectus is a
part:
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the
documents referred to in the “Documents Incorporated by
Reference” section of this
prospectus;
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—
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consents
of accountants, counsel and a financial
advisor;
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powers
of attorney from our directors and
officers;
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the
Thomson Reuters PLC deed of guarantee dated April 17, 2008
described in the “Description of Thomson Reuters PLC Guarantee”
section of this prospectus;
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—
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the
trust indenture dated November 20, 2001, the eighth supplemental indenture
dated September 20, 2005 and the eleventh supplemental indenture dated May
29, 2008 relating to the Debt Securities;
and
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a
statement of eligibility of Deutsche Bank Trust Company Americas as
Trustee, on Form T-1.
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EXPENSES
Set forth
below is an estimate of the approximate amount of the fees and expenses payable
by Thomson Reuters in connection with the registration of the Debt Securities
being offered.
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SEC
registration fee
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US$117,900.00
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Legal
fees and expenses
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27,000.00
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Accounting
fees and expenses
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70,000.00
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Miscellaneous
expenses
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15,000.00
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PURCHASERS’ STATUTORY RIGHTS
Securities
legislation in certain of the provinces of Canada provides purchasers with the
right to withdraw from an agreement to purchase securities. This right may be
exercised within two business days after receipt or deemed receipt of a
prospectus and any amendment. In several of the provinces, the securities
legislation further provides a purchaser with remedies for rescission or, in
some jurisdictions, revision of the price or damages if the prospectus and any
amendment contains a misrepresentation or is not delivered to the purchaser,
provided that the remedies for rescission, revision of the price or damages are
exercised by the purchaser within the time limit prescribed by the securities
legislation of the purchaser’s province. A purchaser of Debt Securities should
refer to any applicable provisions of the securities legislation of the
purchaser’s province for the particulars of these rights or consult with a legal
adviser. Rights and remedies may be available to purchasers under U.S. law;
purchasers may wish to consult with a U.S. lawyer for particulars of these
rights.
INDEPENDENT AUDITORS’ CONSENT
We have
read the short form base shelf prospectus dated December 23, 2008 relating to
the issue and sale of up to US$3,000,000,000 in debt securities of Thomson
Reuters Corporation (fully and unconditionally guaranteed by Thomson Reuters
PLC). We have complied with Canadian generally accepted standards for an
auditor’s involvement with offering documents.
We
consent to the incorporation by reference in the above-mentioned prospectus of
our report to the shareholders of Thomson Reuters Corporation (formerly The
Thomson Corporation), on the consolidated balance sheets of Thomson Reuters
Corporation as at December 31, 2007 and 2006 and the consolidated statements of
earnings, changes in shareholders’ equity and cash flow for each of the years in
the two-year period ended December 31, 2007 and the effectiveness of internal
control over financial reporting as of December 31, 2007. Our report is dated
March 6, 2008.
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(Signed)
PricewaterhouseCoopers LLP
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Chartered
Accountants, Licensed Public
Accountants
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Toronto,
Canada
December
23, 2008
INDEPENDENT AUDITORS’ CONSENT
We have
read the short form base shelf prospectus dated December 23, 2008 relating to
the issue and sale of up to US$3,000,000,000 in debt securities of Thomson
Reuters Corporation (fully and unconditionally guaranteed by Thomson Reuters
PLC). We have complied with Canadian generally accepted standards for an
auditor’s involvement with offering documents.
We
consent to the incorporation by reference in the above-mentioned prospectus of
our report to the Members of Reuters Group PLC included in the Annual Report on
Form 20-F of Thomson Reuters PLC for the year ended December 31, 2007 dated
April 17, 2008 relating to the consolidated balance sheets of Reuters Group PLC
as at December 31, 2007, 2006 and 2005 and the consolidated income statements,
statements of recognised income and expense and cash flow statements for each of
the years in the three-year period ended December 31, 2007 and the effectiveness
of internal control over financial reporting as at December 31, 2007. Our report
is dated March 19, 2008. We also consent to the incorporation by reference in
the above-mentioned prospectus of our report to the Shareholder of Reuters Group
Limited (formerly Reuters Group PLC) included in the business acquisition report
of Thomson Reuters Corporation dated May 15, 2008 relating to the consolidated
balance sheets of Reuters Group PLC as at December 31, 2007, 2006, and 2005 and
the consolidated income statements, statements of recognised income and expense
and cash flow statements for each of the years in the three-year period ended
December 31, 2007. Our report is dated March 19, 2008, except for note 40, as to
which the date is May 15, 2008.
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(Signed)
PricewaterhouseCoopers LLP
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Chartered
Accountants
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London,
United Kingdom
December
23, 2008
US$
Thomson
Reuters Corporation
% Notes
due 20
________________
PROSPECTUS
SUPPLEMENT
,
2009
________________
Joint
Book-Running Managers
|
BofA
Merrill Lynch
|
Barclays
Capital
|
Deutsche
Bank Securities
|
HSBC
|