Assumptions and Limitations. With KML’s acknowledgement and agreement as provided for in the Engagement Agreement, TD Securities has relied upon the accuracy, completeness, and fair presentation of all data and other information obtained by it from public sources or provided to it by KML or its representatives, or otherwise obtained by TD Securities. The Fairness Opinion is premised and conditional upon such accuracy, completeness and fair presentation and there being no misrepresentation (as defined in the Securities Act) of the foregoing data and other information. TD Securities has assumed that there is no information relating to the business, operations and assets of the Acquired Entities or KML, or their respective affiliates, that could reasonably be expected to be material to the Fairness Opinion that has not been disclosed or made available to TD Securities. Subject to the exercise of professional judgment, and except as expressly described herein, TD Securities has not attempted to verify independently the accuracy, completeness or fair presentation of any of the foregoing data and other information. With respect to the budgets, forecasts, projections or estimates provided to TD Securities and used in its analyses, TD Securities notes that projecting future results is inherently subject to uncertainty. TD Securities has assumed, however, that such budgets, forecasts, projections and estimates were prepared using the assumptions identified therein which TD Securities has been advised are (or were at the time of preparation and continue to be), in the opinion of KML, reasonable in the circumstances. TD Securities expresses no independent view as to the reasonableness of such budgets, forecasts, projections and estimates or the assumptions on which they are based. TD Securities was not engaged to review and has not reviewed any of the legal, tax or accounting aspects of the Transaction. TD Securities has assumed that the Transaction complies with all applicable laws. Senior officers of KML, on behalf of KML, have represented to TD Securities in the Certificate, to the best of their knowledge, information and belief after due inquiry: (i) that KML has no information or knowledge of any facts public or otherwise not specifically provided to TD Securities relating to the Acquired Entities which would reasonably be expected to affect materially the Fairness Opinion; (ii) with the exception of forecasts, projections or estimates referred to in subparagraph (iv) below, the information, data and other material (collectively, the ‘‘Information’’) as filed under KML’s profile on the System for Electronic Document Analysis and Retrieval (‘‘SEDAR’’) and/or provided to TD Securities by or on behalf of KML or its representatives in respect of the Acquired Entities is or, in the case of historical Information was, at the date of preparation, true, complete and accurate, and did not and does not contain any untrue statement of a material fact and does not, or in the case of historical Information did not, at the date of preparation, omit to state a material fact necessary to make the Information not misleading in the light of circumstances in which it was presented; (iii) to the extent that any of the Information identified in subparagraph (ii) above is historical, there have been no changes in any material facts or new material facts since the respective dates thereof which have not been disclosed to TD Securities or updated by more current information not provided to TD Securities by KML and there has been no material change, financial or otherwise in the financial condition, assets, liabilities (contingent or otherwise), business or operations of the Acquired Entities and no material change has occurred in the Information or any part thereof which would have or which would reasonably be expected to have a material effect on the Fairness Opinion; (iv) any portions of the Information provided to TD Securities (or filed on SEDAR) which constitute forecasts, projections or estimates were prepared using the material assumptions identified therein, which, in the reasonable opinion of KML, are (or were at the time of preparation and continue to be) reasonable in the circumstances; (v) there have been no valuations or appraisals relating to the Acquired Entities made in the preceding 24 months and in the possession or control of KML other than those which have been provided to TD Securities or, in the case of valuations known to KML which it does not have within its possession or control, notice of which has not been given to TD Securities; (vi) there have been no verbal or written offers or serious negotiations for or transactions involving any material property of KML or any of its affiliates during the preceding 24 months which have not been disclosed to TD Securities; (vii) since the dates on which the Information was provided to TD Securities (or filed on SEDAR), no material transaction has been entered into by KML or any of its affiliates except as publicly disclosed by KML; (viii) other than as disclosed in the Information, the Acquired Entities have no material contingent liabilities and except as have been publicly disclosed by KML or otherwise disclosed to TD Securities, there are no actions, suits, claims, proceedings, investigations or inquiries pending or, to the knowledge of the senior officers of KML, threatened against or affecting the Transaction or the Acquired Entities at law or in equity or before or by any federal, national, provincial, state, municipal or other governmental department, commission, bureau, board, agency or instrumentality which could reasonably be expected to materially adversely affect KML or its affiliates or the Transaction; (ix) all financial material, documentation and other data concerning the Transaction or the Acquired Entities, including any projections or forecasts provided to TD Securities, were prepared on a basis consistent in all material respects with the accounting policies applied in the most recent audited consolidated financial statements of KML or in accordance with non-GAAP measures as publicly disclosed by KML; (x) there are no agreements, undertakings, commitments or understanding (whether written or oral, formal or informal) relating to the Transaction, except as have been disclosed in all material respects to TD Securities; (xi) the contents of any and all documents prepared in connection with the Transaction for filing with regulatory authorities or delivery or communication to security holders of KML (collectively, the ‘‘Disclosure Documents’’) have been, are and will be true, complete and correct in all material respects (subject to permitted redactions in accordance with applicable laws) and have not and will not contain any misrepresentation (as defined in the Securities Act (Alberta)) and the Disclosure Documents have complied, comply and will comply in all material respects with all requirements under applicable laws; (xii) KML has, as of the date hereof, complied in all material respects with the Engagement Agreement, including the terms and conditions of the Indemnity attached as a schedule thereto; and (xiii) to the best of its knowledge, information and belief after due inquiry, except with respect to the Transaction, there is no plan or proposal for any material change (as defined in the Securities Act (Alberta)) in the Acquired Entities which have not been disclosed to TD Securities. In preparing the Fairness Opinion, TD Securities has made several assumptions, including that all final versions of all agreements and documents to be executed and delivered in respect of or in connection with the Transaction will conform in all material respects to the drafts provided to TD Securities, that all conditions precedent to be satisfied to complete the Transaction can and will be satisfied, that all approvals, authorizations, consents, permissions, exemptions or orders of relevant regulatory authorities, courts of law, or third parties required in respect of or in connection with the Transaction will be obtained in a timely manner, without adverse condition or qualification, that all steps or procedures being followed to implement the Transaction are valid and effective and will comply with applicable laws and regulatory requirements, and the Disclosure Documents will be accurate, in all material respects, and will comply, in all material respects, with the requirements of all applicable laws. In its analysis in connection with the preparation of the Fairness Opinion, TD Securities made numerous assumptions with respect to industry performance, general business, political and economic conditions, and other matters, many of which are beyond the control of TD Securities, KML, and their respective affiliates or any other party involved in the Transaction. The Fairness Opinion is conditional on all such assumptions being correct. The Fairness Opinion has been provided for the exclusive use of the Board of Directors of KML and is not intended to be, and does not constitute, a recommendation to the Board of Directors of KML. The Fairness Opinion does not address the relative merits of the Transaction as compared to other transactions or business strategies that might be available to KML, nor does it address the underlying business decision to implement the Transaction. TD Securities’ conclusion as to the fairness, from a financial point of view of the Consideration to be received by ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ULC pursuant to the Transaction is based on its review of the Transaction taken as a whole, rather than any particular element. TD Securities expresses no opinion with respect to future trading prices of securities of KML or any other Interested Party following the announcement and completion of the Transaction. The Fairness Opinion does not constitute a recommendation to acquire or dispose of securities of KML or any other Interested Party nor is it a recommendation to Shareholders as to how to vote on the Transaction or act in any manner in relation to the Transaction. The Fairness Opinion is rendered as of May 28, 2018, on the basis of securities markets, economic, political and general business and financial conditions prevailing on that date and the condition and prospects, financial and otherwise, of the Acquired Entities, KML, and their respective subsidiaries and affiliates as reflected in the Information provided or otherwise available to TD Securities. Although TD Securities reserves the right to change or withdraw the Fairness Opinion in the event that there is any material change in any fact or matter affecting the Fairness Opinion, it disclaims any undertaking or obligation to advise any person of any such change that may come to its attention. TD Securities is not an expert on, and did not render advice to the Board of Directors of KML regarding, legal, tax, accounting or regulatory matters. The Fairness Opinion may not be used by any person or relied upon by any person other than the Board of Directors of KML in connection with the Transaction without the express prior written consent of TD Securities. The Fairness Opinion is not to be reproduced, disseminated, quoted from or referred to (in whole or in part) without TD Securities’ prior written consent, and TD Securities consents to the inclusion of the Fairness Opinion, and a summary thereof (in a form approved by TD Securities), in the Circular. The preparation of a fairness opinion is a complex process and is not necessarily amenable to partial analysis or summary description. TD Securities believes that its analyses must be considered as a whole and that selecting portions of the analyses or the factors considered by it, without considering all factors and analyses together, could create an incomplete view of the process underlying the Fairness Opinion. Accordingly, the Fairness Opinion should be read in its entirety. In considering the fairness of the Consideration to be received by ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ULC under the Transaction from a financial point of view to ▇▇▇▇▇▇ ▇▇▇▇▇▇ Cochin ULC and KML, TD Securities principally considered and relied upon the following approaches: (i) a comparison of the Consideration to be received under the Transaction to a discounted cash flow analysis of the Acquired Entities including various scenario analyses including TMEP sensitivities on timing of completion and total construction costs; (ii) comparison of the multiples implied by the Transaction to the multiples implied by precedent transactions in the Canadian energy pipeline and midstream industry; (iii) a comparison of the multiples implied by comparable Canadian energy pipeline and midstream companies whose securities are publicly traded to the multiples implied by the Consideration under the Transaction; and (iv) a comparison of KML’s indirect share of the Consideration to recent market trading prices of the restricted voting shares in the capital of KML.
Appears in 1 contract
Sources: Share Purchase Agreement
Assumptions and Limitations. With KMLthe Board’s acknowledgement approval and agreement as provided for in the Engagement Agreement, TD Securities RBC has relied upon the accuracy, completeness, accuracy and fair presentation of all data of the financial and other information information, data, advice, opinions or representations obtained by it from public sources or provided to it by KML or its representativessources, or otherwise obtained by TD Securitiessenior management of the Company, and their consultants and advisors (collectively, the “Information”). The Fairness Opinion is premised and conditional upon such accuracycompleteness, completeness accuracy and fair presentation and there being no misrepresentation (as defined in the Securities Act) of the foregoing data and other information. TD Securities has assumed that there is no information relating to the business, operations and assets of the Acquired Entities or KML, or their respective affiliates, that could reasonably be expected to be material to the Fairness Opinion that has not been disclosed or made available to TD Securitiessuch Information. Subject to the exercise of professional judgment, judgment and except as expressly described herein, TD Securities has we have not attempted to verify independently the accuracycompleteness, completeness accuracy or fair presentation of any of the foregoing data and other information. With respect to the budgets, forecasts, projections or estimates provided to TD Securities and used in its analyses, TD Securities notes that projecting future results is inherently subject to uncertainty. TD Securities has assumed, however, that such budgets, forecasts, projections and estimates were prepared using the assumptions identified therein which TD Securities has been advised are (or were at the time of preparation and continue to be), in the opinion of KML, reasonable in the circumstances. TD Securities expresses no independent view as to the reasonableness of such budgets, forecasts, projections and estimates or the assumptions on which they are based. TD Securities was not engaged to review and has not reviewed any of the legal, tax or accounting aspects of the Transaction. TD Securities has assumed that the Transaction complies with all applicable lawsInformation. Senior officers of KML, on behalf of KML, the Company have represented to TD Securities RBC in a certificate delivered as of the Certificatedate hereof, to the best of their knowledgeamong other things, information and belief after due inquiry: that (i) that KML has no information the Information (as defined above) provided orally by, or knowledge in the presence of, an officer or employee of the Company or in writing by the Company or any facts public of its subsidiaries or otherwise not specifically provided their respective agents to TD Securities relating to RBC for the Acquired Entities which would reasonably be expected to affect materially purpose of preparing the Fairness Opinion; (ii) with the exception of forecasts, projections or estimates referred to in subparagraph (iv) below, the information, data and other material (collectively, the ‘‘Information’’) as filed under KML’s profile on the System for Electronic Document Analysis and Retrieval (‘‘SEDAR’’) and/or provided to TD Securities by or on behalf of KML or its representatives in respect of the Acquired Entities is or, in the case of historical Information Opinion was, at the date of preparationthe Information was provided to RBC, trueand is complete, complete true and accuratecorrect in all material respects, and did not and does not contain any untrue statement of a material fact in respect of the Company, its subsidiaries or the Transaction and did not and does not, or in the case of historical Information did not, at the date of preparation, not omit to state a material fact in respect of the Company, its subsidiaries or the Transaction necessary to make the Information or any statement contained therein not misleading in the light of the circumstances in under which it was presented; (iii) to the extent that any of the Information identified in subparagraph was provided or any statement was made; and that (ii) above is historical, there have been no changes in any material facts or new material facts since the respective dates thereof on which have not been disclosed to TD Securities or updated by more current information not the Information was provided to TD Securities by KML and RBC, except as disclosed in writing to RBC, there has been no material change, financial or otherwise otherwise, in the financial condition, assets, liabilities (contingent or otherwise), business business, operations or operations prospects of the Acquired Entities Company or any of its subsidiaries and no material change has occurred in the Information or any part thereof which would have or which would reasonably be expected to have a material effect on the Fairness Opinion; (iv) any portions of the Information provided to TD Securities (or filed on SEDAR) which constitute forecasts, projections or estimates were prepared using the material assumptions identified therein, which, in the reasonable opinion of KML, are (or were at the time of preparation and continue to be) reasonable in the circumstances; (v) there have been no valuations or appraisals relating to the Acquired Entities made in the preceding 24 months and in the possession or control of KML other than those which have been provided to TD Securities or, in the case of valuations known to KML which it does not have within its possession or control, notice of which has not been given to TD Securities; (vi) there have been no verbal or written offers or serious negotiations for or transactions involving any material property of KML or any of its affiliates during the preceding 24 months which have not been disclosed to TD Securities; (vii) since the dates on which the Information was provided to TD Securities (or filed on SEDAR), no material transaction has been entered into by KML or any of its affiliates except as publicly disclosed by KML; (viii) other than as disclosed in the Information, the Acquired Entities have no material contingent liabilities and except as have been publicly disclosed by KML or otherwise disclosed to TD Securities, there are no actions, suits, claims, proceedings, investigations or inquiries pending or, to the knowledge of the senior officers of KML, threatened against or affecting the Transaction or the Acquired Entities at law or in equity or before or by any federal, national, provincial, state, municipal or other governmental department, commission, bureau, board, agency or instrumentality which could reasonably be expected to materially adversely affect KML or its affiliates or the Transaction; (ix) all financial material, documentation and other data concerning the Transaction or the Acquired Entities, including any projections or forecasts provided to TD Securities, were prepared on a basis consistent in all material respects with the accounting policies applied in the most recent audited consolidated financial statements of KML or in accordance with non-GAAP measures as publicly disclosed by KML; (x) there are no agreements, undertakings, commitments or understanding (whether written or oral, formal or informal) relating to the Transaction, except as have been disclosed in all material respects to TD Securities; (xi) the contents of any and all documents prepared in connection with the Transaction for filing with regulatory authorities or delivery or communication to security holders of KML (collectively, the ‘‘Disclosure Documents’’) have been, are and will be true, complete and correct in all material respects (subject to permitted redactions in accordance with applicable laws) and have not and will not contain any misrepresentation (as defined in the Securities Act (Alberta)) and the Disclosure Documents have complied, comply and will comply in all material respects with all requirements under applicable laws; (xii) KML has, as of the date hereof, complied in all material respects with the Engagement Agreement, including the terms and conditions of the Indemnity attached as a schedule thereto; and (xiii) to the best of its knowledge, information and belief after due inquiry, except with respect to the Transaction, there is no plan or proposal for any material change (as defined in the Securities Act (Alberta)) in the Acquired Entities which have not been disclosed to TD Securities. In preparing the Fairness Opinion, TD Securities RBC has made several assumptions, including that all final versions of all agreements and documents the conditions required to be executed and delivered in respect of or in connection with the Transaction will conform in all material respects to the drafts provided to TD Securities, that all conditions precedent to be satisfied to complete the Transaction can and will be satisfied, that all approvals, authorizations, consents, permissions, exemptions or orders of relevant regulatory authorities, courts of law, or third parties required in respect of or in connection with implement the Transaction will be obtained in a timely mannermet. The Fairness Opinion is rendered on the basis of securities markets, without adverse economic, financial and general business conditions prevailing as at the date hereof and the condition or qualificationand prospects, that all steps or procedures being followed to implement financial and otherwise, of the Transaction are valid and effective and will comply with applicable laws and regulatory requirementsCompany, and its subsidiaries and affiliates, as they were reflected in the Disclosure Documents will be accurate, Information and as they have been represented to RBC in all material respects, and will comply, in all material respects, discussions with management of the requirements of all applicable lawsCompany. In its analysis analyses and in connection with the preparation of preparing the Fairness Opinion, TD Securities RBC made numerous assumptions with respect to industry performance, general business, political business and economic conditions, conditions and other matters, many of which are beyond the control of TD Securities, KML, and their respective affiliates RBC or any other party involved in the Transaction. The Fairness Opinion is conditional on all such assumptions being correct. The Fairness Opinion has been provided for the exclusive use of the Board of Directors of KML and is may not intended to be, and does not constitute, a recommendation to be used by any other person or relied upon by any other person other than the Board without the express prior written consent of Directors of KML. The Fairness Opinion does not address the relative merits of the Transaction as compared to other transactions or business strategies that might be available to KML, nor does it address the underlying business decision to implement the Transaction. TD Securities’ conclusion as to the fairness, from a financial point of view of the Consideration to be received by ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ULC pursuant to the Transaction is based on its review of the Transaction taken as a whole, rather than any particular element. TD Securities expresses no opinion with respect to future trading prices of securities of KML or any other Interested Party following the announcement and completion of the Transaction. The Fairness Opinion does not constitute a recommendation to acquire or dispose of securities of KML or any other Interested Party nor is it a recommendation to Shareholders as to how to vote on the Transaction or act in any manner in relation to the TransactionRBC. The Fairness Opinion is rendered given as of May 28, 2018, on the basis date hereof and RBC disclaims any undertaking or obligation to advise any person of securities markets, economic, political and general business and financial conditions prevailing on that date and the condition and prospects, financial and otherwise, of the Acquired Entities, KML, and their respective subsidiaries and affiliates as reflected any change in the Information provided any fact or otherwise available to TD Securities. Although TD Securities reserves the right to change or withdraw matter affecting the Fairness Opinion which may come or be brought to RBC’s attention after the date hereof. Without limiting the foregoing, in the event that there is any material change in any fact or matter affecting the Fairness OpinionOpinion after the date hereof, it disclaims any undertaking RBC reserves the right to change, modify or obligation to advise any person of any such change that may come to its attention. TD Securities is not an expert on, and did not render advice to the Board of Directors of KML regarding, legal, tax, accounting or regulatory matters. The Fairness Opinion may not be used by any person or relied upon by any person other than the Board of Directors of KML in connection with the Transaction without the express prior written consent of TD Securities. The Fairness Opinion is not to be reproduced, disseminated, quoted from or referred to (in whole or in part) without TD Securities’ prior written consent, and TD Securities consents to the inclusion of withdraw the Fairness Opinion, and a summary thereof (in a form approved by TD Securities), in the Circular. The preparation of a fairness opinion is a complex process and is not necessarily amenable to partial analysis or summary description. TD Securities RBC believes that its analyses must be considered as a whole and that selecting portions of the analyses or the factors considered by it, without considering all factors and analyses together, could create an incomplete a misleading view of the process underlying the Fairness Opinion. Accordingly, the The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Any attempt to do so could lead to undue emphasis on any particular factor or analysis. The Fairness Opinion should is not to be read construed as a recommendation to any holder of Shares as to whether to vote in its entirety. In considering the fairness favour of the Consideration to be received by ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ULC under the Transaction from a financial point of view to ▇▇▇▇▇▇ ▇▇▇▇▇▇ Cochin ULC and KML, TD Securities principally considered and relied upon the following approaches: (i) a comparison of the Consideration to be received under the Transaction to a discounted cash flow analysis of the Acquired Entities including various scenario analyses including TMEP sensitivities on timing of completion and total construction costs; (ii) comparison of the multiples implied by the Transaction to the multiples implied by precedent transactions in the Canadian energy pipeline and midstream industry; (iii) a comparison of the multiples implied by comparable Canadian energy pipeline and midstream companies whose securities are publicly traded to the multiples implied by the Consideration under the Transaction; and (iv) a comparison of KML’s indirect share of the Consideration to recent market trading prices of the restricted voting shares in the capital of KML.
Appears in 1 contract
Sources: Merger Agreement (Hostopia.com Inc.)