Enbridge and Spectra Merger FAQs



Frequently Asked Questions about the Exchange Process as a Result of the Combination of Enbridge and Spectra Energy

Why are Enbridge and Spectra merging?
The Merger of Enbridge and Spectra Energy creates a leading global energy infrastructure company and the largest in North America with roughly C$166 billion (US$126 billion) in enterprise value and the strongest liquids and natural gas infrastructure franchises on the continent. It will have a diverse set of low-risk businesses comprised of a best in class network of crude oil, liquids and natural gas pipelines, a large portfolio of strong, regulated gas distribution utilities and a growing renewable power generation platform. The combined company will be positioned to provide integrated services and first and last mile connectivity to virtually all key liquids and gas supply basins and demand markets in North America.

When was the combination completed?
The combination of Enbridge Inc. (“Enbridge”) and Spectra Energy Corp (“Spectra Energy”) was completed on February 27, 2017.

What will I receive in exchange for my shares of Spectra Energy common stock?
Each share of Spectra Energy common stock will be converted into 0.984 of an Enbridge common share. No fractional Enbridge common shares will be issued; instead, you will receive cash in lieu of any fractional Enbridge common share at USD$42.67 per Enbridge share, less applicable withholding taxes.

Is any action required by former holders of Spectra Energy common stock?
Those stockholders holding certificates representing shares of Spectra Energy common stock must properly complete a Letter of Transmittal and submit their Spectra Energy certificates in order to complete the exchange for Enbridge common shares. Any shares of Spectra Energy common stock held electronically in uncertificated (book-entry) form are automatically converted into Enbridge common shares and registered in the same manner as your shares of Spectra Energy common stock.

If you also hold shares of Spectra Energy common stock in “street name” through a bank, broker or other nominee, you should contact your bank, broker or other nominee for further information regarding such shares.

Is Enbridge’s dividend subject to withholding taxes now that the companies are combined?
Yes. Withholding taxes apply to dividends paid to U.S. shareholders but can be limited to 15%. Subject to certain limitations, Canadian tax withheld will be deductible against your U.S. federal income tax liability. The rules governing the foreign tax credit are complex and involve the application of rules that depend upon a U.S. holder’s particular circumstances. Accordingly, U.S. holders should go consult their tax advisors regarding the availability of the foreign tax credit under their particular circumstances.

Additional information and forms related to filing for exemption from Canadian withholding taxes for U.S. residents can be found in Dividend Tax Info under Attention: Tax Information for U.S. Shareholders.

Additional information is included in the final F-4 Proxy Circular/Prospectus found under “Certain U.S. Federal Income Tax Consequences” at the following link: https://www.sec.gov

Do the share exchange mechanics differ if I am a Canadian resident Spectra Energy stockholder who has previously executed and delivered to Enbridge the “Enbridge share purchase agreement”?

No. The actions required to complete the Letter of Transmittal and submit the Spectra Energy certificates are the same as described above and below.

However, if you are a Canadian resident holder and you disposed of your shares of Spectra Energy common stock in consideration for Enbridge common shares pursuant to the Canadian Exchange Offer and you have completed and delivered to Enbridge the “Enbridge Share Purchase Agreement”, you may be eligible to make a joint election with Enbridge pursuant to Section 85 of the Income Tax Act (Canada) (the “Tax Election”).

What if I hold shares of Spectra Energy common stock in both certificated and uncertificated (book-entry) form?
Your certificates representing shares of Spectra Energy common stock must be submitted for exchange to Enbridge’s exchange agent, CST Trust Company (“CST”), in order to complete the exchange of such shares for Enbridge common shares. You will not receive Enbridge common shares and cash in lieu of any fractional Enbridge common share until CST receives and processes your duly completed Letter of Transmittal and accompanying stock certificate(s).

Your uncertificated (book-entry) shares are automatically converted into Enbridge common shares and registered in your name. No further action is required on your part regarding these shares. You will receive a Transaction Advice with your Letter of Transmittal detailing your Enbridge common shares received for your uncertificated (book-entry) shares. Once CST receives and processes your duly completed Letter of Transmittal and accompanying share certificate(s), you will receive a Direct Registration Statement detailing your aggregate holdings of Enbridge common shares, taking into account both your former uncertificated (book-entry) shares and certificates representing shares of Spectra Energy common stock.

What if I can’t locate all of my Spectra Energy stock certificates?
If you cannot locate any or all of your shares of Spectra Energy common stock represented by certificate(s), please follow the instructions provided in the Letter of Transmittal.

What will happen if I do not send in my Spectra Energy stock certificate(s) for the exchange?
Under the terms of the agreement governing the combination, Enbridge will withhold dividends and other distributions on un-exchanged Spectra Energy stock certificates, which will accrue pending the exchange of your Spectra Energy stock certificates. If you do not exchange your certificates, one year following February 27, 2017, the Enbridge common shares, cash in lieu of any fractional share and any dividends and other distributions that are allocated to you will be delivered by CST to Enbridge, without any interest thereon. Thereafter, you may look only to Enbridge for delivery of your Enbridge common shares, cash in lieu of any fractional share and any dividends and other distributions, without any interest thereon.

Should I sign my old Spectra Energy common stock certificates?
No. For your protection, do not endorse your stock certificates.

In what form will Enbridge issue my new shares?
Enbridge will not issue certificates representing Enbridge common shares, whether or not you held certificates representing shares of Spectra Energy common stock. Your Enbridge common shares will be credited to your account in the form of uncertificated (book-entry) shares.

What are uncertificated (book-entry) shares?
Uncertificated (book-entry) shares are Enbridge common shares that are recorded electronically on Enbridge’s books and have the same rights and benefits as certificated shares, but without the risk of certificate loss or misplacement.

Why did I receive additional forms with my transmittal materials?
Enclosed with your Transaction Advice and/or Letter of Transmittal are certain tax and other forms, and an envelope for use in returning such forms to CST. These tax forms will enable CST to calculate applicable withholding on Enbridge’s future dividends and other distributions and the EFT (electronic funds transfer) form will allow for the electronic deposit of future Enbridge dividend payments.

How long will it take to receive my Enbridge common shares?
If you hold your shares of Spectra Energy common stock in uncertificated (book-entry) form, you will be mailed a Transaction Advice within 7 business days of February 27, 2017 notifying you of your new ownership in Enbridge. If you hold certificated shares of Spectra Energy common stock, you will be mailed a Letter of Transmittal with instructions on how to complete the exchange process for such shares within 3 business days of February 27, 2017. Once you submit your certificate(s) with your completed Letter of Transmittal, it will take CST about 7 business days to mail you a Direct Registration Statement reflecting your aggregate ownership of Enbridge common shares, which will include a check for the cash amount of the value of any fractional Enbridge common share.

Will my Transaction Advice or Direct Registration Statement reflect Enbridge common shares held in “street name” through a bank, broker or other nominee?
No. The Transaction Advice or Direct Registration Statement provided with respect to your certificated and/or uncertificated (book-entry) shares of Spectra Energy common stock, as applicable, will only reflect the Enbridge common shares registered to you on the books of Enbridge. You should contact your bank, broker or other nominee for further information regarding your Enbridge common shares held in “street name”.

Is the share exchange a taxable exchange?
It is intended that the exchange of shares of Spectra Energy common stock for Enbridge common shares pursuant to the combination will be tax-free for United States federal income tax purposes. However, any cash received in lieu of a fractional share will be subject to United States federal income tax.

If you are a Canadian resident holder and you disposed of your Spectra Energy common stock for Enbridge common shares pursuant to the combination, you will generally realize a capital gain (or capital loss) equal to the amount by which the fair market value of the Enbridge common shares received (and any cash received in lieu of any fractional Enbridge common share) exceeds (or is less than) the adjusted cost base of the Canadian resident holder’s Spectra Energy common stock determined immediately before the disposition and any reasonable costs of disposition.

If you are a Canadian resident holder and you disposed of your Spectra Energy common stock in consideration for Enbridge common shares pursuant to the Canadian Exchange Offer and file a valid tax election under Section 85 of the Income Tax Act (Canada) jointly with Enbridge, you may wholly or partly defer the recognition of any capital gain that might otherwise arise on the disposition to the extent and subject to the rules and restrictions in the Income Tax Act (Canada).

Will taxes be withheld on the cash payment for the value of the fractional shares?
If you are a U.S. resident holder of shares of Spectra Energy common stock in certificated form, we will not withhold taxes from the cash proceeds in lieu of any fractional Enbridge common share, provided that you properly complete the Substitute Form W-9 included in Part 4 of your Letter of Transmittal. If you are a U.S. resident holder of uncertificated (book-entry) shares, we will not withhold taxes from the cash proceeds in lieu of any fractional Enbridge common share, provided that the books of Spectra Energy contain a valid TIN (Taxpayer Identification Number) for you as of 2017. In the event that we are required to withhold taxes from any cash proceeds, the amount of any withholding will be deducted from the check representing the value of your fractional share attached to your Transaction Advice.

If you are a Canadian resident holder of shares of Spectra Energy common stock in certificated or uncertificated (book-entry) form, there is generally no Canadian withholding.

As a Spectra Energy stockholder I currently receive dividends in U.S. dollars – will my new dividends continue to be paid in U.S. dollars?
Enbridge declares its dividend in Canadian dollars. Enbridge common shares trading on the New York Stock Exchange (NYSE) and the Toronto Stock Exchange (TSX) will pay dividends in Canadian dollars. However, Enbridge delivers payment to U.S. holders of Enbridge common shares in U.S. dollars. The U.S. dollar value of any cash payment for declared dividends to a U.S. holder of Enbridge common shares will be converted into U.S. dollars using the indicative rate of exchange for Canadian interbank transactions established by the Bank of Canada on the declared record date. Fluctuations in the Canadian dollar/U.S. dollar exchange rate may impact the value of any dividend payments received by U.S. holders of Enbridge common shares.

How do I contact CST if I have any additional questions?
For additional information, you can contact CST by telephone toll-free at 1-800-821-2794 or at 1-416-682-3860, or by email at inquiries@canstockta.com. Please do not contact Enbridge or Spectra Energy directly regarding the exchange process.

Frequently Asked Questions regarding the Enbridge Dividend Reinvestment Program (“DRIP”)

Does Enbridge have a DRIP?
Yes. Enbridge offers the opportunity to reinvest dividends on its common shares through a DRIP at a 2% discount on the market price and with no associated fees. Only registered holders of Enbridge common shares may participate in the Enbridge DRIP.

Are there fees attached to having an account at CST Trust Company (“CST”)?
In addition to the 2% discount, no fees are attached to the Enbridge DRIP or having your Enbridge holdings kept at CST.

I am enrolled in the Spectra Energy DRIP; will I automatically be enrolled in the Enbridge DRIP?
No. Stockholders who are enrolled in the Spectra Energy DRIP will not automatically be enrolled in the Enbridge DRIP. You will need to separately enroll in the Enbridge DRIP to participate.

What are the basic terms of the Enbridge DRIP?
The Enbridge DRIP enables registered holders of Enbridge common shares to acquire additional shares through re-investment of the common share dividends paid quarterly, or through optional cash payments. Dividends re-invested through the Enbridge DRIP receive a 2% discount on the market price of Enbridge common shares and funds are fully invested as fractional share ownership is permitted as part of the plan. Enbridge DRIP participants are also eligible to purchase up to an additional $5,000 (CDN) in Enbridge common shares each quarter without incurring brokerage fees; however, the 2% discount is not available for these additional purchases.

How do I enroll in the Enbridge DRIP?
Registered holders of Enbridge common shares who are interested in enrolling in the Enbridge DRIP should fill out the enrollment form available on Enbridge’s website.

You should then mail your completed enrollment form to CST at: CST Trust Company, P.O. Box 4229, Station A, Toronto, Ontario M5W 0G1. It will take roughly 6 weeks to process your DRIP enrollment.

Can I have automatic withdrawals set up to purchase Enbridge common shares monthly under the Enbridge DRIP?
Yes. CST can process automatic withdrawals Canadian bank accounts.

How can I access the prospectus for the Enbridge DRIP?
The prospectus is available online at enbridge.com

If you require a paper copy of the prospectus, please contact CST as provided below.

If I do not wish to enroll in the Enbridge DRIP, may I still keep my Enbridge holdings at CST?
Yes. For those registered holders of Enbridge common shares that do not wish to participate in the Enbridge DRIP, CST will provide dividend payments through the mail or direct deposit via your bank.

Who can I contact for more information on the Enbridge DRIP?
If you require additional information regarding the Enbridge DRIP or holding Enbridge common shares at CST, please contact CST by telephone at 1 800 821 2794 (within North America), 1 416 682 3868 (outside North America), or by email at inquiries@canstockta.com.

Other Frequently Asked Questions

Which stock exchanges do Enbridge shares trade on?
Enbridge common shares trade on the New York Stock Exchange (NYSE) and the Toronto Stock Exchange (TSX) under the trading symbol “ENB”.

Will Enbridge’s dividend be subject to Canadian withholding taxes after the combination?
Yes. Canadian withholding taxes are expected to apply to dividends paid to U.S. shareholders. Subject to certain limitations, Canadian tax withheld will be deductible against your U.S. federal income tax liability. The rules governing the foreign tax credit are complex and involve the application of rules that depend upon a U.S. holder’s particular circumstances. Accordingly, U.S. holders should to consult their tax advisors regarding the availability of the foreign tax credit under their particular circumstances.

Additional information is included in the final F-4 Proxy Circular/Prospectus found under “Certain U.S. Federal Income Tax Consequences” at the following link: https://www.sec.gov

As a U.S. investor, will I receive a 1099 tax form or a K-1?
U.S. shareholders will receive 1099 tax forms for their investment in Enbridge.

Will there be a new company name and ticker for the combined company?
No. The combined company will be called Enbridge Inc. and the shares will remain listed on the TSX and NYSE under the stock symbol ‘ENB’.

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