ITEM 1.01 Entry into a Material Definitive Agreement.
Agreement and Plan of Merger
On September 17,
2018, Enbridge Energy Partners, L.P., a Delaware limited partnership (EEP), Enbridge Energy Company, Inc., a Delaware corporation and the general partner of EEP (the General Partner), Enbridge Energy Management, L.L.C., a
Delaware limited liability company and the delegate of the General Partner (EEQ), Enbridge Inc., a Canadian corporation (Enbridge), Enbridge (U.S.) Inc., Winter Acquisition Sub II, LLC, a Delaware limited liability company
and wholly owned subsidiary of Enbridge (Merger Sub), and, solely for the purposes of Article I, Article II and Article XI, Enbridge US Holdings Inc., a Delaware corporation, entered into an Agreement and Plan of Merger (the
Merger Agreement). Pursuant to the Merger Agreement, Merger Sub will be merged with and into EEP (the Merger), with EEP continuing as the sole surviving entity and a wholly owned subsidiary of Enbridge.
Subject to the terms and conditions set forth in the Merger Agreement, at the effective time of the Merger, each Class A common unit representing a
fractional part of the limited partner interests in EEP (each, an EEP Class A Common Unit) issued and outstanding immediately prior to the effective time of the Merger, other than certain excluded EEP Class A Common Units owned
by Enbridge and its subsidiaries, will be converted into, and become exchangeable for, 0.335 common shares of Enbridge (Enbridge Common Stock).
The special committee (the Special Committee) of the board of directors of EEQ, which manages the affairs and business of EEP as the delegate of
the General Partner (in such capacity, the Board), has, acting in good faith, unanimously, (i) determined, based upon the facts and circumstances it deemed relevant, reasonable or appropriate to its decision, that the Merger
Agreement and the transactions contemplated thereby, including the Merger, are fair and reasonable to EEP, including the holders of the outstanding units of EEP (other than Enbridge and its affiliates) (the Public Unitholders), (ii)
approved the Merger Agreement and the transactions contemplated thereby, on the terms and subject to the conditions set forth in the Merger Agreement, and (iii) recommended that the Board approve the Merger Agreement and the transactions
contemplated thereby. Based upon such recommendation, the Board has, acting in good faith, unanimously (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are fair and reasonable to EEP and
the Public Unitholders, (ii) approved the Merger Agreement and the transactions contemplated thereby on the terms and subject to the conditions set forth in the Merger Agreement, (iii) resolved to recommend that board of directors of the
General Partner (the GP Board) approve the Merger Agreement and the transactions contemplated thereby, and (iv) resolved to recommend that the limited partners of EEP approve the Merger Agreement and the transactions contemplated
thereby and directed that the Merger Agreement be submitted to such limited partners for their approval. Based upon such recommendation, the GP Board, has, acting in good faith, unanimously (i) determined that the Merger Agreement and the
transactions contemplated thereby, including the Merger, are fair and reasonable to EEP and the Public Unitholders, (ii) approved the Merger Agreement and the transactions contemplated thereby on the terms and subject to the conditions set
forth in the Merger Agreement, (iii) resolved to recommend that the limited partners of EEP approve the Merger Agreement and the transactions contemplated thereby and directed that the Merger Agreement be submitted to the limited partners of
EEP for their approval.
EEP has agreed, subject to certain exceptions with respect to unsolicited proposals, not to, directly or indirectly, solicit,
enter into discussions concerning, provide
non-public
information in connection with or otherwise facilitate any effort or attempt to make any competing acquisition proposals. However, the Special Committee
may, subject to certain conditions, change its recommendation in favor of approval of the Merger Agreement if, in connection with the receipt of a superior proposal or an event occurring after the date of the Merger Agreement that was not known by
or reasonably foreseeable to the Special Committee at the time of the execution of the Merger Agreement, the Special Committee determines in good faith, after consultation with its outside counsel and its financial advisor, that the failure to take
such action would be materially adverse to the interests of EEP or the Public Unitholders or would otherwise be reasonably likely to be inconsistent with its duties under applicable law or obligations under the limited partnership agreement of EEP.
The approval of the Merger Agreement requires the affirmative vote of (i) the holders of 66 2/3% of the outstanding units of EEP entitled to vote on
such matter and (ii) the holders of a majority of the outstanding EEP Class A Common Units (other than those held by Enbridge and its affiliates) and the outstanding
I-Units
of EEP (other than
I-Units
voted at the direction of Enbridge and its affiliates) entitled to vote on such matter, voting together as a single class (clauses (i) and (ii), collectively, the Unitholder Approval).
Pursuant to the Merger Agreement, Enbridge has agreed that, at the EEP unitholder meeting and at any meeting of holders of EEQ listed shares held for the purpose of determining how the
I-Units
of EEP shall be
voted, it will vote, or cause to be voted, to the extent permitted under the organizational documents of EEQ, any EEP units or EEQ listed shares then owned beneficially or of record by it or any of its subsidiaries, in favor of the approval of the
Merger Agreement.