Case Documents

PUBLIC VERSION CT-COMPETITION TRIBUNAL

IN THE MATTER of the Competition Act, R.S.C. 1985, c. C-34, and the Competition Tribunal Rules, SOR/94-290;

AND IN THE MATTER of an inquiry under subparagraph 10(1)(b)(ii) of the Competition Act relating to the amalgamation of Suncor Energy Inc. and Petro-Canada;

AND IN THE MATTER of filing and registration of a consent agreement pursuant to section 105 of the Competition Act.

B E T W E E N :

THE COMMISSIONER OF COMPETITION Applicant – and – SUNCOR ENERGY INC. and PETRO-CANADA Respondents CONSENT AGREEMENT IN RELATION TO THE AMALGAMATION OF SUNCOR ENERGY INC. AND PETRO-CANADA TO CONTINUE AS SUNCOR ENERGY INC.

PUBLIC VERSION WHEREAS under an Arrangement Agreement dated March 22, 2009, Suncor Energy Inc. (“Suncor”) and Petro-Canada agreed to amalgamate and continue as “Suncor Energy Inc.” pursuant to a plan of arrangement and in compliance with the provisions of the Canada Business Corporations Act;

AND WHEREAS the existing shareholders of Suncor are to receive one share of the entity formed upon the amalgamation of Suncor and Petro-Canada (“Amalco”) for each share of Suncor and the existing shareholders of Petro-Canada are to receive 1.28 shares of Amalco for each share of Petro-Canada, resulting in Suncor’s existing shareholders receiving approximately 60% of the shares of Amalco and Petro-Canada’s existing shareholders receiving approximately 40% of the shares of Amalco (the “Transaction”);

AND WHEREAS this Consent Agreement (the “Agreement”) shall apply to Amalco following the implementation of the Transaction;

AND WHEREAS the Commissioner of Competition (the “Commissioner”) has concluded that the Transaction is likely to prevent or lessen competition substantially in respect of the retail marketing of gasoline in certain geographic areas in Ontario and in respect of the wholesale supply of gasoline in the Greater Toronto Area and the Respondents do not admit but will not contest the Commissioner’s conclusion for the purposes of the enforcement of any provision of this Agreement, or in any subsequent proceeding, including in any proceedings under section 106 of the Competition Act, in relation to this Agreement;

AND WHEREAS the Commissioner is satisfied that the implementation of this Agreement will be sufficient to ensure that a likely substantial lessening or prevention of competition will not result from the completion of the Transaction;

AND WHEREAS the Applicant and the Respondents agree to the immediate registration of this Agreement with the Competition Tribunal by the Commissioner;

NOW THEREFORE Suncor, Petro-Canada and the Commissioner agree as follows:

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PUBLIC VERSION I. DEFINITIONS [1] For the purposes of this Agreement, unless something in the subject matter or context is inconsistent therewith, the following capitalized terms have the following meanings:

(a) “Act” means the Competition Act, R.S.C., 1985, c. C-34, as amended; (b) “Affiliate” means an affiliated corporation, partnership or sole proprietorship within the meaning of subsection 2(2) of the Act;

(c) “Agreement” means this Consent Agreement entered into between Suncor, Petro-Canada and the Commissioner pursuant to section 105 of the Act, including the schedules hereto;

(d) “Amalco” means the entity formed upon the amalgamation of Suncor and Petro-Canada in accordance with the terms and conditions set forth in the Arrangement Agreement and its Affiliates and “Amalco” shall include the Respondents, their respective Affiliates and any successors or assigns of a Respondent or any of its Affiliates;

(e) “Ancillary Product Suppliers” means Persons who supply products and services to the ancillary businesses operated at the Divested Stations;

(f) “Arrangement Agreement” means the Arrangement Agreement between Suncor and Petro-Canada dated March 22, 2009;

(g) “Business Day” means a day other than a Saturday, Sunday or statutory holiday in the Province of Ontario;

(h) “Closing Date” means the date on which the Transaction is completed; (i) “Commissioner” means the Commissioner of Competition appointed pursuant to section 7 of the Act or any Person designated by the Commissioner to act on her behalf;

(j) “Competitively Sensitive Information” means confidential or proprietary - 3 -

PUBLIC VERSION information belonging to, relating to or otherwise concerning any Pioneer Entity (which for the purposes of this definition only shall include any Person in respect of which a Pioneer Entity owns, directly or indirectly, voting securities) that is not generally available to the public, including but not limited to pricing information and policies, sales or marketing plans, profit margins or cost information on a specific product or service basis, strategic plans, budgeting, supply arrangements (other than any supply arrangements entered into with Amalco or any discussions or negotiations between Amalco and a Pioneer Entity regarding any such future supply arrangements), and location and expansion plans;

(k) “Confidential Information” means confidential or proprietary information belonging to, relating to or otherwise concerning the Divested Retail Business or the Terminalling Services that is not generally available to the public, including, but not limited to, any customer and supplier lists, price lists, and marketing methods or other trade secrets;

(l) “CPL” means cents-per-litre (expressed in Canadian currency); (m) “Divested Retail Business” means the business of marketing and supplying, at the Divested Stations, gasoline, diesel and, where offered by Amalco as at the date of the Arrangement Agreement, ancillary products and services at the Divested Stations;

(n) “Divested Retail Business Assets” means, other than Excluded Assets, all of Amalco’s right, title and interests in the Divested Retail Business and all ofAmalco’s assets of the Divested Retail Business of every kind and description wheresoever situate, including but not limited to, the following:

(i) the Divested Stations; (ii) all applicable site-specific licences, permits, contracts, agreements and authorizations, to which Amalco is a party or a beneficiary, used in the operation of each Divested Station;

(iii) the Intellectual Property; - 4 -

PUBLIC VERSION (iv) all tangible assets and equipment used at each Divested Station; (v) all Divested Station Agreements; (vi) all petroleum products and other inventories at each Divested Station; (vii) all books, records and files specific to the Divested Retail Business (for greater certainty, to the extent that there are any books, records or files which are common to the Divested Retail Business and to Amalco’s ongoing business, Amalco shall provide copies of such books, records and files to the Purchaser); and

(viii) any assets used in any ancillary businesses operated at the Divested Stations, including, but not limited to, any automobile mechanical service, convenience store, restaurant or car wash, operated in connection with each Divested Station, including, but not limited to, all permits, contracts, agreements and authorizations, to which Amalco is a party or a beneficiary, used in the operation of the ancillary businesses.

Notwithstanding the foregoing and for greater clarity, nothing in this Agreement shall require Amalco to include within or as part of the Divested Retail Business Assets: (a) the back office, transactional/credit/debit and loyalty systems and services and assets used in connection with Amalco’s other businesses (including all software and equipment); (b) point of sale software and related equipment; (c) any brands (including without limitation brand elements such as signs and facia) used in association with the Divested Stations; (d) any marketing or promotional program materials and equipment, including without limitation, any loyalty programs, branded bank machines and back wall advertising screen software; (e) agreements for the supply of products or services to all or part of Amalco’s retail network and which include retail gas stations that are not part of the Divested Retail Business; (f) any contracts, agreements, permits, licences, or authorizations which are not specific to a particular retail gas station or the Divested Stations as a group but, rather, are proprietary to, and/or used by, Amalco in the operation of its retail network and any

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PUBLIC VERSION related equipment or software (including but not limited to Glide Carwash); and (g) any agreements with Divested Station Retail Associates, (the assets described in the immediately preceding (a) to (g) being, collectively, the “Excluded Assets”). With respect to equipment described in (f) that is used in connection with car washes, Amalco will, at its expense, promptly remove the network-related equipment and reinstall site level activation equipment to ensure that the car wash is operational;

(o) “Divested Station Agreements” means all agreements entered into by Amalco relating to the ownership and/or operation of the Divested Stations including, without limitation, real property leases;

(p) “Divested Station Retail Associates” means independent contractors who operate Divested Stations whether as franchisees, consignees or commission agents;

(q) “Divested Stations” means the 104 retail gas stations located in Ontario set out in Schedule “B” and Schedule “B.1” to this Agreement and, if applicable pursuant to paragraphs 30 or 31 of this Agreement, the alternate retail gas stations set out in Confidential Schedule “B.2” (provided that any retail gas station set out in Schedule “B” and Schedule “B.1” that is replaced by an alternate retail gas station listed on Confidential Schedule “B.2” shall immediately cease to be a Divested Station and such alternate retail gas station shall thereafter be a Divested Station);

(r) “Divestiture” means the sale, transfer, assignment, public offering, or other conveyance of the Divestiture Assets such that Amalco will have no further direct or indirect interest in the Divestiture Assets, except as permitted herein or upon the consent of the Commissioner;

(s) “Divestiture Agreement” means a binding and definitive agreement between Amalco and a Purchaser or, if necessary, between the Divestiture Trustee and a Purchaser, in each case to effect the Divestiture contemplated by this Agreement;

(t) “Divestiture Assets” means the Divested Retail Business Assets, as modified, where applicable, by Confidential Schedule “E”, either as a whole or individually where

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PUBLIC VERSION all of the Divested Retail Business Assets are not sold to a single Purchaser; (u) “Divestiture Monitor” means the Person appointed pursuant to paragraph 4 of this Agreement and any employees, agents or other Persons acting for or on behalf of the Divestiture Monitor;

(v) “Divestiture Trustee” means a Person appointed pursuant to paragraph 41 of this Agreement and any employees, agents or other Persons acting for or on behalf of the Divestiture Trustee;

(w) “Divestiture Trustee Sale” means a Divestiture to be conducted by the Divestiture Trustee pursuant to Part VII of this Agreement;

(x) “Excluded Assets” has the meaning set out in the definition of Divested Retail Business Assets;

(y) “Independent Industry Expert Seller” means a Person appointed pursuant to paragraph 77 of this Agreement, and any employees, agents or other Persons acting for or on behalf of the Independent Industry Expert Seller;

(z) “Independent Marketer” means a purchaser of unbranded gasoline for purposes of resale or supply to a retail gas station or for its own sale at a retail gas station and who is not, nor is an Affiliate of, a Person that operates a refinery in the Province of Ontario or Québec, and also shall not include, for the purposes of this Agreement, UPI Energy LP, any Pioneer Entity or any other Person in which Amalco holds any interest, direct or indirect, for so long as Amalco holds any interest, direct or indirect, in UPI Energy LP, any Pioneer Entity or such other Person as applicable;

(aa) “Initial Sale Period” means the period set out in Confidential Schedule “C” to this Agreement;

(bb) “Intellectual Property” means intellectual property of any nature and kind used in connection with or related to any of the Divested Stations, including, but not limited to:

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PUBLIC VERSION (i) patents; (ii) copyrights; (iii) software; (iv) trademarks; (v) trade secrets, know-how, techniques, data, inventions, practices, methods and other confidential or proprietary technical, business, research, development and other information, and all rights in any jurisdiction to limit the use or disclosure thereof;

(vi) rights to obtain and file for patents and registrations thereof; and (vii) rights to sue and recover damages or obtain injunctive relief for infringement, dilution, misappropriation, violation or breach of any of the foregoing.

Notwithstanding the foregoing, Intellectual Property does not include any intellectual property used primarily in connection with the Excluded Assets;

(cc) “Kent Area” means each of the geographic areas as defined by Kent Marketing Services Limited for the purposes of compiling retail gasoline price statistics;

(dd) “Metro Depot” means Amalco’s terminal depot located at 1138 Finch Avenue West, Toronto, Ontario, M3J 2E2;

(ee) “ML” means Million Litres; (ff) “Montreal Facility” means Amalco’s refinery at Montreal or such other installation in the Montreal area as may be agreed upon between Amalco and a Throughput Party;

(gg) “Oakville Terminal” means Amalco’s terminal located at 3275 Rebecca Street, Oakville, Ontario, L6L 6N5;

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PUBLIC VERSION (hh) “Permitted Persons” means any Person employed by or on behalf of Amalco to provide accounting, legal, business valuation or investment banking services (which shall include the process of selling the Divestiture Assets), including any external provider of such services;

(ii) “Person” means any individual, partnership, limited partnership, firm, corporation, association, trust, unincorporated organization or other entity, whether acting alone or in concert with another Person;

(jj) “Petro-Canada” means Petro-Canada and its Affiliates; (kk) “Pioneer Entity” means any of PPHI, PPMI, Pioneer Operating Partnership, Pioneer Holding Partnership or any Affiliate of any such Person, other than an Affiliate of PPHI, PPMI, Pioneer Operating Partnership, or Pioneer Holding Partnership in respect of which Amalco has no direct or indirect interest;

(ll) “Pioneer Holding Partnership” means Pioneer Petroleums Holding Limited Partnership;

(mm) “Pioneer Operating Partnership” means Pioneer Petroleums Limited Partnership; (nn) “PPHI” means Pioneer Petroleums Holding Inc.; (oo) “PPMI” means Pioneer Petroleums Management Inc.; (pp) “Purchaser” means the Person that acquires the Divestiture Assets pursuant to this Agreement or the Persons that acquire the Divestiture Assets where the Divestiture Assets are sold to more than a single Person. None of Shell Canada Limited, Imperial Oil Limited, or any Related Party of the foregoing, shall constitute a Purchaser for the purposes of this Agreement. None of UPI Energy LP, any Pioneer Entity or any other Person in which Amalco holds any interest, direct or indirect, shall constitute a Purchaser for the purposes of this Agreement for so long as Amalco holds any interest, direct or indirect, in UPI Energy LP, any Pioneer Entity, or other such Person, as applicable;

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PUBLIC VERSION (qq) “Related Party” has the meaning ascribed thereto in Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions in effect on the date hereof;

(rr) “Residual Assets” means those Divested Retail Business Assets, as modified, where applicable, by Confidential Schedule “E”, which are not subject to a Divestiture Agreement that has been entered into with a Purchaser and approved by the Commissioner in accordance with this Agreement prior to the expiration of the Initial Sale Period;

(ss) “Suncor” means Suncor Energy Inc. and its Affiliates; (tt) “Suncor Sub” means 1044287 Ontario Inc., being a subsidiary of Suncor, which holds one common share in the capital of PPMI;

(uu) “Take or Pay” means a flat monthly fee which is calculated and charged on the basis of the total annual volume required under the applicable terminalling agreement divided by twelve (12) months and multiplied by the terminalling fee which shall be expressed in CPL of throughput;

(vv) “Terminalling Fee” means the fee to be paid in CPL for the Terminalling Services set out at paragraphs 67(a) and 67(b) of this Agreement;

(ww) “Terminalling Services” at the Metro Depot Terminal, means pipeline receipt, storage and rack delivery services for fungible gasoline and diesel products, and at the Oakville Terminal, means pipeline and marine receipt, storage and rack delivery services for fungible gasoline and diesel products;

(xx) “Throughput Party” means any Person who is not a Related Party to Amalco that enters into Terminalling Services obligations with Amalco pursuant to, or as contemplated by, paragraph 67(a) or (b) of this Agreement (and “Throughput Parties” means, where more than one Throughput Party enters into Terminalling Services obligations with Amalco, those Persons that enter into Terminalling Services obligations with Amalco). Neither Shell Canada Limited nor Imperial Oil

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PUBLIC VERSION Limited, nor any Related Party of the foregoing, shall constitute a Throughput Party for the purposes of this Agreement. None of UPI Energy LP, any Pioneer Entity or any other Person in which Amalco holds any interest, indirect or direct, shall constitute a Throughput Party for the purposes of this Agreement for so long as Amalco holds any interest, direct or indirect, in UPI Energy LP, any Pioneer Entity, or such other Person, as applicable;

(yy) “TNPI” means Trans-Northern Pipeline, Inc. (and its heirs, legal representatives, successors and assigns) and the pipeline operated by Trans-Northern Pipeline, Inc.;

(zz) “Transaction” means the transaction as described in the recitals; (aaa) “Tribunal” means the Competition Tribunal established by the Competition Tribunal Act, R.S.C. 1985, c.19 (2 nd Supp.), as amended; (bbb) “Trustee Sale Period” means the period following the expiration of the Initial Sale Period set out in Confidential Schedule “C”, within which the Divestiture Trustee is empowered to sell the Residual Assets or such longer period as directed by the Commissioner; and

(ccc) “Wholesale Supply Year” means each successive twelve (12) month period commencing on the Closing Date.

All other terms defined in this Agreement have the meanings established elsewhere in this Agreement.

II. APPLICATION [2] The provisions of this Agreement shall apply to: (a) Amalco, and Amalco shall cause each of its Affiliates and the Respondents will cause each of their Affiliates to carry out their respective obligations under this Agreement;

(b) each officer, employee, consultant, agent or other Person acting for or on behalf of - 11 -

PUBLIC VERSION Amalco; (c) all other Persons acting in concert or participating with one or more of those listed in (a) or (b);

(d) the Commissioner; (e) the Divestiture Monitor; (f) the Divestiture Trustee; (g) each Throughput Party and its heirs, legal representatives, successors and assigns; (h) the Independent Industry Expert Seller; and (i) each Purchaser and its heirs, legal representatives, successors and assigns. [3] Parts V, VI, VII, VIII, IX, X, XI, XII and XIII of this Agreement shall come into effect immediately following the Closing Date. The remaining Parts of this Agreement shall immediately come into effect upon registration of this Agreement with the Tribunal.

III. DIVESTITURE MONITOR [4] The Commissioner shall appoint a Divestiture Monitor responsible for monitoring Amalco’s compliance with Parts IV, V, VI and VII of this Agreement. The Divestiture Monitor’s obligations and powers shall not expire under this Agreement until the Divestiture is effected. For greater certainty, Amalco’s obligation in paragraph 24 shall not constitute a Divestiture for the purposes of this Agreement.

[5] The selection of the Divestiture Monitor by the Commissioner shall be subject to the consent of Amalco, which consent shall not be unreasonably withheld. If Amalco has not opposed, in writing, including the reasons for opposing, the selection of the Divestiture Monitor within five (5) Business Days after notice by the Commissioner to Amalco of the identity of the Divestiture Monitor, Amalco shall be deemed to have consented to the selection of the proposed Divestiture Monitor.

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PUBLIC VERSION [6] Within five (5) Business Days of the date of the selection of the Divestiture Monitor, the Divestiture Monitor and Amalco shall execute an agreement that, subject to the approval of the Commissioner, confers on the Divestiture Monitor all of the rights and powers necessary to permit the Divestiture Monitor to monitor Amalco’s compliance with the terms of this Agreement in a manner consistent with this Agreement. The Divestiture Monitor shall sign a confidentiality agreement in a form determined by the Commissioner. The Divestiture Monitor shall:

(a) have the power and authority to monitor Amalco’s compliance with Parts IV, V, VI and VII of this Agreement and shall exercise such power and authority and carryout his, her or its duties and responsibilities pursuant to the terms of this Agreement and in a manner consistent with the purposes of this Agreement;

(b) serve at the cost and expense of Amalco, and have the authority to engage, at reasonable cost and expense to be borne by Amalco, such consultants, accountants, lawyers, investment bankers, business brokers, appraisers, and other representatives and assistants as are reasonably necessary to carry out the Divestiture Monitor’s duties and responsibilities;

(c) provide Amalco and the Commissioner with a detailed account of all time and expenses incurred by the Divestiture Monitor (the Divestiture Monitor may redact from Amalco’s account confidential information or references to legal advice to the Divestiture Monitor). For greater certainty, the Divestiture Monitor shall be reimbursed for only reasonable costs and expenses incurred as outlined in the detailed account;

(d) to the extent that it is within Amalco’s control, have full access to all personnel, records and facilities of the Divestiture Assets or any other relevant information, including Confidential Information, that the Divestiture Monitor requests;

(e) provide a report to the Commissioner every thirty (30) days concerning compliance with Parts IV, V, VI and VII of this Agreement and, additionally, forthwith upon the Commissioner’s request; and

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PUBLIC VERSION (f) notify the Commissioner immediately if and when the Divestiture Monitor considers Amalco to be in default of any of its obligations pursuant to Parts IV, V, VI or VII of this Agreement.

[7] Amalco shall provide all assistance as may be reasonably requested by the Divestiture Monitor, and shall not interfere with the Divestiture Monitor’s execution of its obligations under this Agreement.

[8] Amalco shall not attempt to influence, direct or control the Divestiture Monitor. [9] If the Divestiture Monitor ceases to act or fails to act diligently and in a manner consistent with the purposes of this Agreement, the Commissioner may appoint a substitute Divestiture Monitor consistent with the terms of this Part III, subject to the consent of Amalco, which consent shall not be unreasonably withheld. If Amalco has not opposed, in writing, including the reasons for opposing, the selection of the substitute Divestiture Monitor within five (5) Business Days after notice by the Commissioner to Amalco of the identity of any substitute Divestiture Monitor, Amalco shall be deemed to have consented to the selection of the proposed substitute Divestiture Monitor. Amalco and the substitute Divestiture Monitor shall execute an agreement that, subject to the approval of the Commissioner, confers on the substitute Divestiture Monitor all of the rights and powers necessary to permit the substitute Divestiture Monitor to monitor Amalco’s compliance with the terms of this Agreement in a manner consistent with this Agreement. The substitute Divestiture Monitor shall sign a confidentiality agreement in a form determined by the Commissioner. The provisions of this Agreement shall apply, mutatis mutandis, to any substitute Divestiture Monitor appointed pursuant to this paragraph.