Canadian Public M&A Deal Study 2014

Transaction Overview • Industry Classification • Trans
action Size • Buyer Type • Transaction Structure • Co
sideration Type • Preliminary Considerations • Consid
eration • Initiation of Transaction Process • Financial
Advisors and Fairness Opinions • Ownership of Targe
Securities • Lock-up Agreements • Procedural Consid
erations • Transaction Timing • Special Meeting Proc
ess • Contractual Matters • Treatment of Target Secur
ties • Material Adverse Effect • Interim Period Coove
nants • Conditions • Deal Protections • Non-Solicitat
ion • Right to Match • Termination Rights • Break Fee
Reciprocal Break Fee • Expense Reimbursement • R
emedies • Transaction Overview • Industry Classifica-
tion • Transaction Size • Buyer Type • Transaction St
ructure • Consideration Type • Preliminary Considera
tions • Consideration • Initiation of Transaction Proces
• Financial Advisors and Fairness Opinions • Ownersh
ip of Target Securities • Lock-up Agreements • Proce-
dural Considerations • Transaction Timing • Special
Meeting Process • Contractual Matters • Treatment of
Target Securities • Material Adverse Effect • Interim
Period Covenants • Post-Closing Covenants • Condi-
tions • Deal Protections • Non-Solicitation • Right to
Match • Termination Rights • Break Fee • Reciprocal
Break Fee • Expense Reimbursement • Remedies •
Canadian Public M&A Deal Study
Sixth Annual Edition
2014
blakes.comBlake,Cassels & Graydon LLP |

2014 | Blakes Canadian Public M&A Deal Study

Blake, Cassels & Graydon LLP | blakes.com
2 Introduction
3 Transactions Overview
3 Industry Classification
3 Transaction Size
4 Buyer Type
4 Transaction Structure
5 Consideration Type
6 Preliminary Considerations
6 Initiation of Transaction Process
8 Financial Advisors and Fairness Opinions
9 Ownership of Target Securities
10 Lock-up Agreements
11 Procedural Considerations
11 Transaction Timing
12 Special Meeting Process
14 Contractual Matters
14 Treatment of Target Securities
15 Material Adverse Effect
16 Interim Period Covenants
20 Post-Closing Governance
21 Conditions
26 Deal Protections
26 Non-Solicitation
29 Right to Match
30 Termination Rights
31 Break Fee
33 Reciprocal Break Fee
35 Expense Reimbursement
37 Remedies
38 Appendices
38 Appendix A: Survey Method
39 Appendix B: Transactions Reviewed
40 Appendix C: Blakes Mergers & Acquisitions Practice
1CONTENTS
Blakes Canadian Public M&A Deal Study

2 INTRODUCTION
The sixth annual Blakes Canadian Public M&A Deal Study focuses on recurring
and emerging issues in the structuring and negotiation of Target-supported public
company acquisitions in Canada. The topics covered in the Study range from overall
transaction structure and timing, such as the strategic review process and the
formation of special committees, to specific contractual provisions, such as tax
covenants, break and reciprocal break fees and non-solicitation provisions.
Blakes prepared this Study based on a review of the 50 largest Canadian Target-
supported transactions announced between June 1, 2012 and May 31, 2013,
excluding transactions initiated without Target support. Where noted, we have
included data from prior Blakes studies, resulting in deal information taken from up to
250 transactions. For additional information on the method used to prepare the Study
and the transactions reviewed, see Appendices A and B.
We invite you to review the results of the Study, which we hope will provide you
with valuable insight for future transactions.
About Blakes Mergers and Acquisitions Practice
Blakes has one of the largest and most active mergers and acquisitions practices
in Canada, having been involved in more than 1,100 public and private M&A
transactions, with an aggregate dollar value in excess of US$1-trillion, in the past
seven years. According to Bloomberg, Blakes has been Canada’s busiest M&A law
firm each year since 2007. At the end of 2013, Blakes remained the leading Canadian
firm in both domestic and global announced M&A deals based on deal count.
Transactions on which we regularly advise range from negotiated acquisitions of
private companies to the largest public company or trust mergers and acquisitions
completed by way of take-over bids, amalgamations and plans of arrangement. We
advise clients on structuring considerations, related-party rules, special committee
obligations, take-over defences and contested shareholder meetings.
For more information on our mergers and acquisitions practice, see Appendix C or
visit www.blakes.com.

60
2008/9 2009/10 2010/11 2011/12
40
20
50
30
10
0
40%
32%
56%
30% 32%
26%26%
30%
2012/13
42%
36%
Industry Classification
Transaction Size
BuyerType
Transaction Structure
ConsiderationType
TRANSACTIONS
OVERVIEW
3
Transaction Size
US$1-billion to
US$5-billion
(6%)
Over
US$5-billion
(4%)
Under
US$250-million
(42%)
US$250-million
to US$500-million
(36%)
US$500-million
to US$1-billion
(12%)
Real Estate
(6%)
Commercial
Services (4%)
Mining/Basic
Materials
(38%)
Oil & Gas/
Energy (30%)
Technology &
Communications
(10%)
Consumer
(2%)
Financial Services (2%)
%
%
Mining/Basic Materials
Oil & Gas/Energy
Under US$250-million
US$250-million to US$500-million
Resource Sectors
Canada’s Mid-Market
Pharmaceuticals (2%)
50
2008/9 2009/10 2010/11 2011/12
40
20
30
10
0
32%
36%
44% 44%
32%
30%
40%
24%
2012/13
38%
30%
Industrial/Utilities
(6%)

100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
80%
92% 94% 94%
20%
8% 6% 6%
82%
18%
2012/13
Transaction Size
BuyerType
ConsiderationType
TRANSACTIONS
OVERVIEW
4
BuyerType
Strategic
Financial
%
Plan of arrangement
Take-over bid
Other shareholder-
approved transactions
% 80
2008/9 2009/10 2010/11 2011/12
60
40
20
0
60%
34%
6%
62%
26%
12%
78%
22%
0%
76%
18%
6%
18%
8%
74%
2012/13

Transaction Size
BuyerType
ConsiderationType
TRANSACTIONS
OVERVIEW
5
If consideration consisted of a combination of cash and securities, was the cash
component nominal (relative to the share consideration)?
In 100% of transactions where Buyer securities were included as consideration, the
exchange ratio was fixed (i.e., a specified number of Buyer securities were offered per
Target secturity).
ConsiderationType
Cash only
Securities only
Shareholder election of
cash and/or securities
Combination of cash
and securities
% 60
2008/9 2009/10 2010/11 2011/12
50
40
30
20
10
0
14%
16%
18%
8%
18%
18%
10%
56%
40%
42%
44%
4%
14%
14%
52%
2012/13
30%
34%
26%
22%
20%
No
(70%)
Yes
(30%)

40
2008/9 2009/10 2010/11 2011/12
30
20
10
0
28%
22%
30%
34%
2012/13
42%
PRELIMINARY
CONSIDERATIONS
Initiation of
Transaction Process
Financial Advisors and Fairness
Opinions
Ownership of
Target Securites
Lock-up Agreements
6
Based on disclosure in the Target circular, did Target undertake a review of strategic
alternatives before contact with Buyer was established?
In what percentage of transactions was there no review of strategic alternatives prior
to contact with Buyer and no market check following contact with Buyer?
Was the review of strategic alternatives
publicly announced by Target?
Was a market check conducted by
Target following contact with Buyer?
Did the acquisition
agreement include a
“go-shop” period?
%
Initiation ofTransaction Process
No
(52%)
No
(80%)
No
(100%)
No
(67%)
Yes
(48%)
Yes
(20%)
Yes
(33%)
Yes
(0%)

Initiation of
Transaction Process
Opinions
Ownership of
Target Securites
Lock-up Agreements
PRELIMINARY
CONSIDERATIONS
7
In what percentage of transactions was Target permitted to solicit acquisition proposals
following execution of the transaction agreement (e.g., including a “go-shop”)?
Did Target establish a special committee of directors?
What was the composition of the special committee?
Number of Members
2008/9
2
2009/10
3
2010/11
4 5 or
more
(6%)
(15%)
(2%)
(52%)
(2%)
(18%)
(15%)
Independence
All
independent
Majority
independent
(90%)
(8%)
Number of Members as
Percentage of Board Size
Average Median
(46%)
(43%)
No
(20%)
Yes
(80%)
Initiation ofTransaction Process (cont’d)
2011/12 2012/13
(2%)
(0%)
(2%)
Minority
independent

PRELIMINARY
CONSIDERATIONS
Initiation of
Transaction Process
FinancialAdvisors and
Fairness Opinions
Ownership of
Target Securites
Lock-up Agreements
8
In what percentage of transactions did Target
obtain a fairness opinion?
In what percentage of transactions was
the specified number of financial advisors
engaged by Target and Buyer?
In what percentage of transactions was
the specified number of fairness opinions
obtained by Target?
Where related party and other provisions of
Multilateral Instrument 61-101 – Protection
of Minority Security Holders in Special
Transactions were inapplicable, who provided
the fairness opinion(s) to Target?
100
2008/9 2009/10 2010/11 2011/12
90
80
70
60
50
94%
96%
100%
98%
2012/13
98%
% 100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
91%
85%
76% 73%
2012/13
80%
9%
15%
0%
22%
2%
27%
20%
0% 0% 0%
%
One opinion
Two opinions
Three or more opinions
Target
Buyer
Financial
Advisor(s)
Independent
Advisor
BothTwo Three or
More
OneNone or
Undisclosed
(76%)
(30%)
(72%)
(0%)
(26%)
(2%)
(56%)
(12%)
(2%)
(12%) (12%)
Financial Advisors and Fairness Opinions

15
2009/102008/9 20010/11 2011/12
12
9
6
3
0
4%
0%
4% 4%
2012/13
12%
PRELIMINARY
CONSIDERATIONS
9
Initiation of
Transaction Process
Opinions
Ownership of
Target Securites
Lock-up Agreements
In 18% of transactions, compared to 12% in the previous year, Buyer owned Target
securities prior to execution of the transaction agreement. In these transactions,
what was Buyer’s ownership level in Target prior to the acquisition transaction?
In what percentage of transactions did Buyer agree to subscribe for Target shares in
connection with execution of the transaction agreement?
30% to 40%
(11%)
40% to 50%
(11%)
> 50%
(22%)
0% to 10%
(22%)
20% to 30%
(0%)
Ownership of Target Securities
10% to 20%
(34%)
%

100
2008/9 2009/10 2010/11 2011/12
0
55%
61% 58%
48%
2012/13
42%
100
2008/9 2009/10 2010/11 2011/12
0
95% 98% 98% 95%
2012/13
93%
Initiation of
Transaction Process
Opinions
Ownership of
Target Securites
Lock-upAgreements
PRELIMINARY
CONSIDERATIONS
10
In 90% of transactions, compared to 88% in the prior year, lock-up agreements were
entered into with Target shareholder(s). In what percentage of these transactions
was the specified percentage of Target securities locked up?
If a lock-up agreement was entered
into, what was the percentage of
transactions where:
Target management and/or
directors were locked up?
Parties other than Target
management and/or directors
were locked up?
Breach of the lock-up
agreement triggered a
termination right for Buyer
under the transaction
agreement?
%
%
%
Lock-up Agreements
Under 10%
(42%)
10% to 20%
(15%)
20% to 30%
(11%)
30% to 40%
(7%)
40% to 50%
(7%)
>50%
(18%)
100
2008/9 2009/10 2010/11 2011/12
0
47%
33% 28%
34%
2012/13
20%

TransactionTiming
Special Meeting Process
11PROCEDURAL
CONSIDERATIONS
For shareholder-approved transactions, where an outside meeting date was imposed,
what was the number of days between the date of the transaction agreement and
the outside meeting date?
What was the number of days between the date of the transaction agreement and
the actual closing date?
Shareholder-approved transactions undertaken under foreign statutes, which were
excluded above, closed in an average of 112 days, with a median of 132 days.
80
2008/9 2009/10 2010/11 2011/12
70
60
50
76
68
69
66
74
65
72
71
2012/13
64
62
No. of
days
No. of
days
100
2008/9 2009/10 2010/11 2011/12
80
40
60
20
0
68%
32%
55%
66%
76%
45% 34%
24%
2012/13
47%
53%
%
> 60 days
≤ 60 days
Average
Median
TransactionTiming
Take-over bids (average)
Shareholder-approved
transactions (average)
Take-over bids (median)
Shareholder-approved
transactions (median)
72
90
80
2008/9 2009/10 2010/11 2011/12
70
60
50
71
65
71
74
55
71
72
68
63
66
64
2012/13
84
70
69
58
86
55
66
53

80
2008/9 2009/10 2010/11 2011/12
60
40
20
0
61%
57% 56% 57%
2012/13
80%
TransactionTiming
PROCEDURAL
CONSIDERATIONS
12
%
For shareholder-approved transactions, in what percentage of transactions could
Buyer require Target to adjourn the special meeting of Target’s shareholders?
When Buyer could require Target to adjourn the special meeting of Target’s
shareholders, the average maximum length of adjournment permitted was
11 business days.
In 58% of transactions, the maximum adjournment was less than or equal to
10 business days (compared to 63% of transactions in the prior year).
On what basis could Buyer require an adjournment?
Alternative
Proposal
(73%)
Unilateral
(15%)
Other
(21%)

80
2008/9 2009/10 2010/11 2011/12
60
40
20
0
39%
43%
62%
56%
2012/13
51%
PROCEDURAL
CONSIDERATIONS
TransactionTiming
13
%
For shareholder-approved transactions, in what percentage of transactions could
Buyer force a vote of Target’s securityholders regardless of a Superior Proposal,
assuming no termination of the transaction agreement by Target?
Were optionholders of Target entitled to vote at the special meeting
of securityholders?
In 100% of transactions under Canadian law where optionholders of Target were
entitled to vote, optionholders voted together with holders of common shares (the
same percentage as in the three prior years). In transactions under foreign statutes,
optionholders were entitled to a separate class vote in each case.
Yes
(27%)
No
(73%)
Special Meeting Process (cont’d)

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
14
How were Target options treated under the
acquisition agreement?
What prohibitions were imposed on
extraordinary dividends and distributions
by Target?
If cashed out, did Buyer agree to elect not
to take the section 110(1)(d) tax deduction in
connection with the transaction?
Did dividends or other distributions by
Target, whether or not extraordinary, trigger
a reduction in the purchase price under the
transaction agreement?
Exchanged for
Buyer options
(11%)
No cash and
no stock/property
(82%)
Yes, with
exclusion for
previously
declared
(14%)
Terminated
(2%)
Yes
(20%)
No
(66%)
No
(45%)
Yes
(55%)
Cashed out
(62%)
Accelerated, with
unexercised cancelled
(21%)
No prohibition
(16%)
Adjusted in
accordance with terms
(4%)
Treatment of Target Securities
No stock/property
(2%)

Treatment of
Target Securities
MaterialAdverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
15
%
In what percentage of transactions did the Material Adverse Effect (MAE) definition
include the effect on Target’s ability to perform its obligations under the transaction
agreement, and was it subject to the exceptions in the MAE definition?
How many specific exceptions were included in the MAE definition?
On average, the MAE definition included 8 exceptions.
10 or more
exceptions
(25%)
7-9
exceptions
(59%)
3-6
exceptions
(16%)
Included
Where included, subject
to exceptions
Material Adverse Effect
100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
88%
32%
50%
24%
67%
30%
65%
34%
2012/13
24%
50%

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
16
In what percentage of transactions was Target required to undertake a pre-closing
reorganization at the request of Buyer?
If Target was required to undertake a pre-closing reorganization, what were the
conditions imposed on Buyer?
(93%) Advance notice to Target
(68%) Reimbursement of Target for costs
(71%) Indemnification of Target
(82%) Reorganization cannot be prejudicial to Target or
its shareholders
(79%) Reorganization cannot impede or delay closing
(32%) Buyer must waive all conditions to closing
(64%) Reorganization cannot breach any applicable laws
or constating documents
(64%) Reorganization cannot give rise to adverse
tax consequences
(57%) Reorganization cannot interfere with Target operations
(57%) Other conditions
(46%) Reorganization cannot require Target shareholder approval
Interim Period Covenants
Not required
(44%)
Required
(56%)

Blake, Cassels Graydon LLP | blakes.com
Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
17
What was the standard for the parties to obtain regulatory approvals?
Reasonable Efforts
(10%)
Reasonable Best Efforts (6%)
Best Efforts (4%)
Commercially
Reasonable Efforts
(80%)
Interim Period Covenants (cont’d)
Where the closing of the transaction was subject to a condition related to the
Competition Act (Canada), was Buyer explicitly not required to provide any remedies
to satisfy the condition?
Yes
(44%)
No
(56%)

2014 | Blakes Canadian Public MA Deal Study
Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
18
Investment Canada Act (ICA), was Buyer required to offer all undertakings necessary
to satisfy the condition?
Was Buyer explicity not required to provide undertakings that Buyer did not consider
reasonable in order to satisfy the ICA condition?
No
(89%)
No
(89%)
Yes
(11%)
Yes
(11%)
Yes
(0%)
Yes
(63%)
No
(100%)
No
(37%)
2011-12
2011-12
2012-13
2012-13

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
19
In 100% of transactions there was an obligation on Buyer or Target to ensure
continued directors’ and officers’ insurance or to purchase run-off insurance for the
Target directors and officers.
The average run-off period for such insurance policies was six years, the same
average as transactions announced in all prior years of the Study.
In 58% of transactions there was a maximum premium payable for the DO
insurance to be obtained. In such transactions, what was the limitation on
premiums?
300% of current
premium amount
(28%)
200% of current
premium amount
(38%)
150% of current
premium amount
(7%)
250% of current
premium amount
(24%)
Specified
dollar amount
(3%)

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
20
In what percentage of transactions did the transaction agreement include provisions
setting forth the governance of Target following closing?
Where governance provisions were included, what aspects of post-closing
governance were addressed by the transaction agreement?
Included
(26%)
Not
included
(74%)
Post-Closing Governance
100
2010/112009/10 2011/12
80
60
40
20
0
83%
92%
100%
2012/13
33%
15% 15%
8%
92%
17%
4%
0% 0% 0%
% Composition of board
of directors
Identity of chairman
Entity name
Location of headquarters

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
21
How common were the following conditions to the closing of the transaction?
For take-over bids, what was the minimum tender threshold at the commencement
of the bid?
(70%) Absence of threatened governmental litigation
(50%)
Absence of threatened non-governmental
third-party litigation
(24%) Approval of Buyer’s shareholders
(8%) Divestiture of specified Target assets
(32%) Solvency of Target (through accuracy of representation
and warranties or as a specified condition)
(10%)
Maintenance of specified level of Target
financial performance or condition
(4%)
Entry into, or continued effect of, Target
management employment agreements
Conditions
% 662/3%
50%
Other
100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
88%
12%
100%
0% 0% 0%0%
90%
10%
89%
11%
2012/13
0%
11%
89%

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
22
Yes
(54%)
No
(46%)
Was closing of the transaction conditional on Competition Act (Canada) clearance?
Conditions (cont’d)
What was the nature of the Competition Act (Canada) condition?
Reciept of Advance
Ruling Certificate (ARC)
or receipt of
no-action letter and
expiration/termination
of waiting period
(88%)
Expiration of
waiting period only
(12%)
Where receipt of an ARC or no-action letter was a condition to closing, was it
required to be on terms satisfactory to Buyer?
Yes
(77%)
No
(23%)

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
23
Was closing of the transaction conditional on Investment Canada Act (ICA) clearance?
No
(84%)
No
(37%)
Yes
(16%)
Yes
(63%)
In 100% of transactions where closing was conditional on ICA matters, the condition
required receipt of notice that the applicable federal government Minister was
satisfied that the transaction is likely to be of net benefit to Canada.
Where receipt of such Ministerial notice was a condition to closing, was it required
to be on terms satisfactory to Buyer?

100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
2012/13
62%
85%
89%
83%
92%
81%
100%
96% 96% 95%
92%
92%
88%
95%
94%
Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
24
For shareholder-approved transactions, in what percentage of transactions was there
a level of dissent condition?
What was the threshold for the level of dissent condition?
%
%
All shareholder-
approved
transactions
Securities as all or
part of consideration
Cash only
consideration
5%
10%
15%
Other
100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
10%
8%
0%
25%
9%
16%
26%
53%
82%
76%
2012/13
6%
3%
3%
28%
63%
68%
6%
3%
3%
18%

Treatment of
Target Securities
Material Adverse
Effect
Interim Period
Covenants
Post-Closing
Governance
Conditions
CONTRACTUAL
MATTERS
25
How accurate did Target’s representations and warranties have to be as a closing
condition in favour of Buyer?
Were any specific representations and warranties subject to a stricter standard (e.g.,
required to be true in all respects) as a closing condition in favour of Buyer?
Where specific representations and warranties were required to be true in all respects, which ones
were subject to this higher standard?
Yes
(48%)
No
(52%)
(96%) Capitalization
(71%) Authorization
(62%) Organization
(25%) Ownership of subsidiaries
(17%) Property/mineral rights
(12%) Broker’s fees
(12%) No material adverse change
(12%) Execution/binding
(12%) Non-contravention of
law/constating documents
(42%) Other
True, except to the
extent inaccuracies
do not give rise
to a MAE
(14%)
True, without giving effect to
any materiality qualifiers, except
to the extent inaccuracies
do not give rise to a MAE
(55%)
True, but if not subject to any
materiality qualifiers, then true
except to the extent inaccuracies
do not give rise to a MAE
(6%)
True in all
material respects
(23%)
True in all respects
(2%)

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Reciprocal Break Fee
Expense Reimbursement
Remedies
DEAL PROTECTIONS
26
What are the requirements for an acquisition proposal to qualify as a
Superior Proposal?
Same form of consideration as existing agreement?
If specified, percentage of Target shares that must be subject to the proposal?
May be subject to a due diligence condition?
May be subject to a financing condition?
May be subject to delays in closing?
Yes
(0%)
100%
(74%)
Yes
(18%)
Yes, but financing must be
reasonably available
(37%)
No and financing must
be reasonably available
(35%)
Yes
(4%)
Must be reasonably capable
of completion
without undue delay
(71%)
Must be
reasonably
capable of
completion
(25%)
No
(100%)
50%
(22%)
90%
(2%)
No
(72%)
Yes
(8%)
Limited
(10%)
No
(20%)
Non-Solicitation
20%
(2%)

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
27
What constituted a Superior Proposal?
If the acquisition proposal was ____________ to the existing proposal.
When could access to Target’s confidential information be provided to a
third party?
If the acquisition proposal ____________ a Superior proposal.
When could Target terminate the transaction agreement with Buyer?
If the acquisition proposal from the third party ____________ a Superior Proposal.
“financially superior/more
favourable”
(98%)
“could reasonably be
expected to lead to”
(78%)
“other standard”
(2%)
“would be”
(20%)
“constitutes”
(98%)
Non-Solicitation (cont’d)
“could reasonably be
expected to constitute”
(2%)
“other standard”
(2%)

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
28
When was Target’s board of directors permitted to change its recommendation?
Did Target’s board of directors have a general right to take any action and/or make
any disclosure in order to comply with its fiduciary duties?
In 72% of such transactions, Target’s board of directors had to obtain advice (written
or otherwise) of outside legal counsel before taking any such action or making any
such disclosure.
In response
to a Superior
Proposal
(18%)
To comply with its
fiduciary duties in
response to a
Superior Proposal
(68%)
Not
permitted
(2%)
To comply with
its fiduciary
duties generally
(8%)
To comply with its
fiduciary duties in
response to a Superior
Proposal or the occurence
of an intervening event
(4%)
Yes
(36%)
No
(64%)
Non-Solicitation (cont’d)
In what percentage of transactions
was Target required to:
Not waive existing standstill 94%
provisions?
Actively prosecute and 82%
enforce existing standstill
provisions?
Include standstill in 78%
confidentiality agreements
with third parties?
Not pay fees or expenses of 8%
an alternate bidder?
Prior to providing access to a third-
party bidder, in what percentage of
transactions was Target required to
provide Buyer with:
Identity of third-party bidder? 94%
Copy of confidential 80%
documents provided to
third party?
Summary of material terms 78%
of alternative proposal?
Copy of alternative proposal 76%
and related documents?

48 hours 72 hours
3 business
days
5 days
5 business
days
Other
Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
29
In 100% of transactions where Target was subject to non-solicitation provisions,
Buyer had a right to match a Superior Proposal.
What was the matching period?
What information was Target required to provide to Buyer as part of the
matching process?
2012/13
2011/12
(0%)
(2%)
(6%)
(6%)
(14%)
(10%)
(70%)
(74%)
(4%)
(4%)
(6%)
(4%)
Copy of
proposal
(96%)
Board
confirmation
of Superior
Proposal
(80%) Valuation
of non-cash
consideration
(39%)
Summary
of material
terms
(29%)
Copy of
financing
documents
(20%)
Right to Match

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
30
What acts by Target in respect of a third-party acquisition proposal gave rise to a right
of termination for Buyer?
(100%) Withdrawal/modification of board recommendation
(98%) Approval/recommendation of acquisition proposal
(68%) Breach of non-solicitation
(70%) Entry into agreement in respect of acquisition proposal
(80%) Failure to reconfirm recommendation at request of Buyer
(46%) Failure to reconfirm recommendation after announcement
of acquisition proposal
(44%) No position on acquisition proposal for specified period
of time
(60%) Announcement of intention to recommend or enter into
acquisition proposal
Termination Rights
Where approval by Buyer’s shareholders was a condition to closing, could Buyer
terminate the acquisition agreement if it accepted a “superior proposal” in respect
of Buyer or if Buyer changed its recommendation to shareholders?
Yes
(50%)
No
(50%)

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
31
Since 2007, 98% of the transactions reviewed have been subject to a break fee
payable by Target.
In what percentage of transactions was the break fee two-tiered?
What percentage of Target’s undiluted equity value was the break fee?
Where the transaction was subject to a break fee, what were the average and
median fees (as a percentage of Target’s undiluted equity value)?
%
%
average
median
0.9%
and
≤ 2.0%
2.0%
and
≤ 2.5%
2.5%
and
≤ 3.0%
3.0%
and
≤ 3.5%
3.5%
and
≤ 4.0%
4.0%
and
≤ 15.9%
(10%)
(2%)
(23%)
(29%)
(25%)
(14%)
(27%)
(33%)
(18%)
(29%)
(2%)
(4%)
(6%) (6%)
(14%)
(22%)
(11%)
(25%)
Break Fee
12
2008/9 2009/10 2010/11 2011/12
9
6
3
0
12%
10%
4%
8%
2012/13
0%
5
2008/9 2009/10 2010/11 2011/12
4
3
2
1
0
4.0%
3.8%
3.6% 3.6%
3.2%
3.6% 3.5% 3.6%
2012/13
3.8%
3.6%
2010/2011
2011/2012
2012/2013

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
32
Break Fee (cont’d)
In 94% of the transactions that included a break fee, the break fee was payable in
connection with an alternative acquisition transaction occurring post-termination
(i.e., a “tail” trigger), compared to 100% in the previous year.
In connection with such a break fee trigger, a third party must have ___________ an
alternative proposal prior to the special meeting of Target shareholders or the expiry
of the take-over bid, as applicable.
In 27% of transactions that included a tail trigger, the break fee was payable
only in connection with “such” acquisition proposal, as opposed to 73% of such
transactions where it was payable in connection with “any” post-termination
acquisition transaction.
In connection with the tail trigger, what was the period within which the alternative
acquisition transaction had to be signed/consummated following a specified date
(being one of the date of the agreement with the Buyer (11%), the termination of
the agreement with the Buyer (62%), the originally scheduled Target shareholder
meeting (5%) or the first acquisition proposal by a third party (22%))?
12 months
(60%)9 months
(18%)
6 months
(22%)
Announced
(93%) Made
(83%)
Announced
an intention
to make
(50%)
Proposed
(24%)
Offered
(22%)

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
33DEAL PROTECTIONS
Was the transaction subject to a reciprocal break fee payable by Buyer?
What percentage of Target’s undiluted equity value was the reciprocal break fee?
Where the transaction was subject to a reciprocal break fee, what were the average
and median reciprocal break fees (as a percentage of Target’s undiluted equity value)?
Yes
(40%)
No
(60%)
0.2%
and
≤ 2.0%
2.0%
and
≤ 2.5%
2.5%
and
≤ 3.0%
3.0%
and
≤ 3.5%
3.5%
and
≤ 4.0%
4.0%
and
≤ 7.5%
(28%)
(16%)(15%)
(22%) (24%) (22%)
(17%)
(32%)
(25%)
(16%)
(10%)(11%)
(30%)
(8%)
(20%)
(4%)
(0%) (0%)
%
average
median
2010/11
2011/12
2012/13
5
2008/9 2009/10 2010/11 2011/12
4
3
2
1
0
3.3%
3.5%
3.1% 3.5%
2.9%
3.3%
2.7%
3.8%
2012/13
3.1%
3.3%

DEAL PROTECTIONS
34
Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
Reciprocal Break Fee (cont’d)
For Buyer’s
breach of
covenant
(40%)
For
reciprocal
triggering
events as
break fee
(25%)
For failure
to pay
purchase
price
(20%)
For failure
to close
by outside
date if Buyer
and mutual
conditions
are satisfied
(20%)
Other
(30%)
The reciprocal break fee was ___________ the break fee.
How common was it for the reciprocal break fee to be payable by Buyer for the
following termination events?
%
“equal to”
“less than”
“greater than”
100
2008/9 2009/10 2010/11 2011/12
80
60
40
20
0
14%
5%
12%
72%
0%
28%
12%
28%
88%
67%
60%
2012/13
80%
20%
0%
For failure
to obtain
specified
regulatory
approval
(15%)
For failure to
recommend,
or change of
recommendation,
to, or failure to
receive approval
from, Buyer’s
shareholders
(10%)
Competition Act (Canada), none of the transactions required Buyer to pay Target a fee
for failure to satisfy such condition.

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
35DEAL PROTECTIONS
Failure to
obtain Target
securityholder
approval
(48%)
Failure to
obtain Buyer
securityholder
approval
(31%)
Target’s
breach of
representation
or covenant
(72%)
Buyer’s
breach of
representation
or covenant
(62%)
Failure to
close by
outside date
(16%)
Failure to
close by
outside date
(31%)Other
(24%)
Other
(46%)
Was the transaction subject to expense reimbursement?
As a result of which termination events was
expense reimbursement payable by Target?
As a result of which termination events was
expense reimbursement payable by Buyer?
By Buyer only
(2%)
No
(48%)
By Target only
(26%)
By both
(24%)

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
DEAL PROTECTIONS
36
Expense Reimbursement (cont’d)
Where the transaction was subject to expense reimbursement, what was the
amount of such reimbursement?
Where the transaction was subject to expense reimbursement, what were the
average and median caps or specified amounts payable (as a percentage of Target’s
undiluted equity value)?
% of Target’s
undiluted
equity value
Average cap on actual
expenses or specified
amount payable
Median cap on actual
expenses or specified
amount payable
1.5
2008/9 2009/10 2010/11 2011/12
1.0
0.5
0
0.6%
1.0%
0.4%
0.8%
0.9%
0.7%
0.6%
0.6%
2012/13
0.6%
1.4%
100
2009/10 2010/11 2011/12 2012/13
0
79%
21%
56%
60%
0%0%0%
75
50
25
44%
40%
46%
15%
39%
%
Specified amount
Actual expenses subject
to a cap
Actual expenses

Non-Solicitation
Right to Match
Termination Rights
Break Fee
Remedies
37DEAL PROTECTIONS
Remedies
In 98% of transactions, the transaction agreement did not explicitly preclude all
parties from seeking specific performance. If not explicitly precluded, which parties
were entitled to seek specific performance?
Did the transaction agreement include an express right or prohibition for Target
shareholders to sue for breach of the agreement?
Both Buyer
and Target
(96%)
Neither
(56%)
Buyer only
(4%)
Right
(0%)
Prohibition
(44%)

The sixth annual Blakes Canadian Public MA Deal Study focuses on recurring
and emerging issues in the structuring and negotiation of Target-supported public
company acquisitions in Canada. The topics covered in the Study range from
overall transaction structure and timing, such as the strategic review process and
the formation of special committees, to specific contractual provisions, such as
regulatory conditions, break and reciprocal break fees and non-solicitation provisions.
Blakes prepared the Study based on a review of the 50 largest Canadian Target-
supported transactions announced between June 1, 2012 and May 31, 2013,
excluding transactions initiated without Target support. Where noted, we have
included data from prior Blakes studies, resulting in deal information taken from up
to 250 transactions. For a list of the transactions reviewed this year, see Appendix B.
In compiling the Study, Blakes reviewed acquisition agreements, management
proxy circulars, take-over bid circulars, press releases and related publicly available
documents filed on the System for Electronic Document Analysis and Retrieval
(SEDAR) maintained on behalf of the Canadian securities regulatory authorities for
use by reporting issuers.
The agreements and disclosure documents that form the basis of the Study each
include specific drafting tailored to the particular transaction in question. The terms of
many transactions are not directly comparable. Accordingly, Blakes has relied on its
judgment and discretion in summarizing, categorizing and reflecting these provisions
in the Study. In addition, the Study is based solely on publicly available information.
Non-public information, such as information included in disclosure schedules or
exhibits to an acquisition agreement not filed on SEDAR, may be relevant to the
analysis but is not reflected in the Study.
The results of this Study do not reflect the views of Blakes. Whether a specific
term of an acquisition should apply or not is highly dependent on the facts and
circumstances of each particular transaction. Accordingly, the applicability of any
aspect of the Study to a specific transaction merits close consideration based upon
the facts and circumstances of that transaction.
APPENDIX A:
SURVEY METHOD
38

TARGET ACQUIROR (PARENT) ANNOUNCEMENT DATE
Nexen Inc. CNOOC Ltd. 23/07/2012
Progress Energy Resources Corp. PETRONAS 28/06/2012
Primaris Retail REIT HR REIT 16/01/2013
Celtic Exploration Ltd. Exxon Mobil Corp. 17/10/2012
Uranium One Inc. ARMZ Uranium Holding OAO, Effective Energy NV 14/01/2013
CGA Mining Ltd. B2Gold Corp. 19/09/2012
Garda World Security Corp. Apax Partners LLP, Private Investor 07/09/2012
The Brick Ltd. Leon’s Furniture Ltd. 11/11/2012
Talison Lithium Ltd. Rockwood Holdings Inc. 23/08/2012
Aurizon Mines Ltd. Hecla Mining Co. 04/03/2013
Peer 1 Network Enterprises Inc. Cogeco Cable Inc. 21/12/2012
CC Energia Ltd. Pacific Rubiales Energy Corp. 19/11/2012
Queenston Mining Inc. Osisko Mining Corp. 12/11/2012
Guide Exploration Ltd. WestFire Energy Ltd. 09/08/2012
La Mancha Resources Inc. Weather Investments II SARL 13/07/2012
Extorre Gold Mines Ltd. Yamana Gold Inc. 18/06/2012
Spartan Oil Corp. Pinecrest Energy Inc. 21/11/2012
Orko Silver Corp. First Majestic Silver Corp. 16/12/2012
Avion Gold Corp. Endeavour Mining Corp. 07/08/2012
YM Biosciences Inc. Gilead Sciences Inc. 12/12/2012
Miranda Technologies Inc. Belden Inc. 05/06/2012
PMI Gold Corp. Keegan Resources Inc. 05/12/2012
KEYreit Plazacorp Retail Properties Ltd. 25/03/2013
Softchoice Corp. Birch Hill Equity Partners Management Inc. 22/04/2013
Pure Energy Services Ltd. FMC Technologies Inc. 20/08/2012
Rainy River Resources Ltd. New Gold Inc. 31/05/2013
Galway Resources Ltd. AUX Acquisition 2 SARL (EBX Group) 19/10/2012
Prodigy Gold Inc. Argonaut Gold Inc. 15/10/2012
PetroMagdalena Energy Corp. Pacific Rubiales Energy Corp. 05/06/2012
Inter-Citic Minerals Inc. Western Mining Group Co Ltd. 27/08/2012
Sprott Resource Lending Corp. Sprott Inc. 08/05/2013
AvenEx Energy Corp. Pace Oil Gas Ltd. 20/12/2012
Eacom Timber Corp. Kelso Co. 22/03/2013
IROC Energy Services Corp. Western Energy Services Corp. 22/02/2013
Compton Petroleum Corp. MFC Industrial Ltd. 09/07/2012
Vero Energy Inc. TORC Oil Gas Ltd. 13/09/2012
Score Media Inc. Rogers Media Inc. 25/08/2012
Shear Wind Inc. Sprott Power Corp. 08/08/2012
Shona Energy Co Inc. Canacol Energy Ltd. 15/10/2012
Second Wave Petroleum Inc. Brookfield Bridge Lending Fund Inc. 06/05/2013
Cerro Resources NL Primero Mining Corp. 13/12/2012
Afferro Mining Inc. International Mining Infrastructure Corp. PLC 22/05/2013
Winstar Resources Ltd. Kulczyk Oil Ventures Inc. 25/04/2013
CIC Energy Corp. Jindal Steel Power Ltd. 23/07/2012
H Paulin Co Ltd. The Hillman Cos Inc. 18/12/2012
Andina Minerals Inc. Hochschild Mining PLC 08/11/2012
C2C Industrial Properties Inc. Dundee Industrial REIT 19/03/2013
Arbor Memorial Services Fairfax Financial Holdings Ltd., JC Clark Advisor Ltd., 11/09/2012
Scanfield Holdings Ltd.
20-20 Technologies Inc. Vector Capital Corp. 30/07/2012
Wenzel Downhole Tools Ltd. Basin Holdings US LLC 13/05/2013
* By announced transaction value
39APPENDIX B:
TRANSACTIONS
REVIEWED

APPENDIX C:
BLAKES MERGERS
ACQUISITIONS PRACTICE
40
Blakes has one of the largest and most active mergers and acquisitions practices in Canada, having been involved
in more than 1,100 public and private MA transactions, with an aggregate dollar value in excess of US$1-trillion,
in the past seven years. According to Bloomberg, Blakes has been Canada’s busiest MA law firm each
year since 2007.
Transactions on which we regularly advise range from negotiated acquisitions of private companies to the largest
public company mergers and acquisitions completed by way of take-over bids, amalgamations and plans of
arrangement. We advise clients on structuring considerations, related-party rules, special committee obligations,
take-over defences and contested shareholder meetings.
As a known leader, our Mergers Acquisitions is regularly recognized by the following publications:
• IFLR1000: The Guide to the World’s Leading Financial Law Firms
• The Legal 500 Canada
• The Best Lawyers in Canada
• Chambers Global: The World’s Leading Lawyers for Business
• The Canadian Legal Lexpert Directory
• The Lexpert/American Lawyer Guide to the Leading 500 Lawyers in Canada
• Law Business Research’s The International Who’s Who of Business Lawyers
At the end of 2013, Blakes remained the top Canadian law firm in numerous categories. Our No. 1 league table
rankings include:
Canada
No. 1 in Canada Announced deals by deal count (Bloomberg)
No. 1 in Canada Completed deals by deal value (Thomson Reuters)
Global
No. 1 Canadian firm in Global Announced deals by deal count (Bloomberg)
No. 1 Canadian firm in Global Announced deals by deal value (Thomson Reuters)
No. 1 Canadian firm in Global Announced deals by deal value (mergermarket)
No. 1 Canadian firm in Global Completed deals by deal value and deal count (Thomson Reuters)
United States
No. 1 Canadian Firm in United States Announced deals by deal value and deal count (Thomson Reuters)
No. 1 Canadian firm in United States Announced deals by deal count (Bloomberg)
No. 1 Canadian firm in United States Announced deals by deal value (mergermarket)
No. 1 Canadian Firm in United States Completed by deal value and deal count (Thomson Reuters)
No. 1 Canadian Firm in United States Public Completed deals by deal value and deal count (Thomson Reuters)
For more information on our mergers and acquisitions practice, visit www.blakes.com.

Montréal
Blake, Cassels Graydon S.E.N.C.R.L./s.r.l.
600 de Maisonneuve Boulevard West
Suite 2200
Montréal QC H3A 3J2
Canada
Telephone: 514-982-4000
Facsimile: 514-982-4099
E-mail: montreal@blakes.com
Ottawa
Blake, Cassels Graydon LLP
340 Albert Street
Suite 1750, Constitution Square,Tower 3
Ottawa ON K1R 7Y6
Canada
Telephone: 613-788-2200
Facsimile: 613-788-2247
E-mail: ottawa@blakes.com
Toronto
199 Bay Street
Suite 4000, Commerce Court West
Toronto ON M5L 1A9
Canada
Telephone: 416-863-2400
Facsimile: 416-863-2653
E-mail: toronto@blakes.com
Calgary
855 – 2nd Street S.W.
Suite 3500, Bankers Hall EastTower
Calgary ABT2P 4J8
Canada
Telephone: 403-260-9600
Facsimile: 403-260-9700
E-mail: calgary@blakes.com
Vancouver
595 Burrard Street
P.O. Box 49314
Suite 2600,Three Bentall Centre
Vancouver BC V7X 1L3
Canada
Telephone: 604-631-3300
Facsimile: 604-631-3309
E-mail: vancouver@blakes.com
NewYork
Blake, Cassels Graydon (U.S.) LLP
126 East 56th Street
Suite 1700,Tower 56
NewYork NY 10022-3613
U.S.A.
Telephone: 212-893-8200
Facsimile: 212-829-9500
E-mail: newyork@blakes.com
Chicago
Blake, Cassels Graydon (U.S.) LLP
181 West Madison Street
Suite 3925
Chicago IL 60602-4645
U.S.A.
Telephone: 312-739-3610
Facsimile: 312-739-3611
E-mail: chicago@blakes.com
London
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5th Floor
London EC4R 2RP
England
Telephone: +44-20-7429-3550
Facsimile: +44-20-7429-3560
E-mail: london@blakes.com
Bahrain
in association with
Dr. Saud Al-Ammari Law Firm
5th Floor, GB CorpTower
Bahrain Financial Harbour
P.O. Box 11005
Manama
Kingdom of Bahrain
Telephone: +973 17 15 15 00
Facsimile: +973 17 10 49 48
E-mail: bahrain@blakes.com
Al-Khobar*
Dr. Saud Al-Ammari Law Firm
in association with
Apicorp Building
P.O. Box 1404
Al-Khobar 31952
Kingdom of Saudi Arabia
Telephone: +966 3 847 5050
Facsimile: +966 3 847 5353
E-mail: saud.ammari@blakes.com
Beijing
7 Dong Sanhuan Zhonglu
Suite 901, OfficeTower A, Beijing Fortune
Plaza
Chaoyang District
Beijing 100020
People’s Republic of China
Telephone: +86-10-6530-9010
Facsimile: +86-10-6530-9008
E-mail: beijing@blakes.com
Shanghai*
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Suite 718, Shanghai Centre
Shanghai 200040
People’s Republic of China
Telephone: +86-10-6530-9010
Facsimile: +86-10-6530-9008
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* Associated Office

MONTRÉAL
OTTAWA
TORONTO
CALGARY
VANCOUVER
NEW YORK
CHICAGO
LONDON
BAHRAIN
AL-KHOBAR*
BEIJING
SHANGHAI*
*Associated Offices Blake, Cassels Graydon LLP | blakes.com

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