EX-99.(C)(10) 10 d732888dex99c10.htm EX-99.(C)(10)

Exhibit (c)(10)

PRELIMINARY CONFIDENTIAL DRAFT Subject to Further Review & Revision
Project Rushmore Discussion Materials
February 14th, 2019
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Table of Contents
I. Situation Overview
II. Status Quo Management Projections Overview III. Abe Financial Analysis IV. Ulysses Financial Analysis V. Transaction Analysis
Supplemental Analysis
Appendix
2
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I. Situation Overview
3
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Summary of Proposed Transaction
Proposal Component Description Exchange Ratio Detail
∎ Each Abe Common Unit held by public IDR Buyin Proposal Prior to Investor Day Proposal Date Current Implied Offer 9/19/2018 12/3/2018 1/25/2019 2/8/2019 1/25/2019 2/8/2019 to receive: Spot Abe Price $40.39 $36.67 $29.89 $30.14 $32.01 $30.64 Abe 30-Day VWAP $40.22 $36.50 $26.34 $28.43 Consideration 0.500 Ulysses shares Spot Ulysses Price $53.76 $57.59 $55.95 $53.21 -—-
(1) (1)
Spot XR 0.7513x 0.6367x 0.5342x 0.5664x 0.5720x 0.5757x
$4.03 Cash
Premium to Spot 7.1% 1.6%
∎ Taxable transaction to Abe unitholders Premium to 30-Day VWAP 21.5% 7.7%
∎ Status Quo Abe ownership:∎ Pro Forma Ulysses ownership:
Ownership Abe Public Unitholders: ~74.7% Abe Public Unitholders: ~16.5%(2)
Ulysses: ~25.3% Existing Ulysses Shareholders: ~83.5%
∎ Ulysses will exchange newly-issued Ulysses shares and cash for Abe common units held by public Structure∎ Transaction requires vote of Abe common unitholders, but no vote of Ulysses shareholders∎ Elimination of MLP
∎ 12/4: Abe and Ulysses Investor Day∎ 2/8: Draft merger agreement & Ulysses management presentation ∎ 1/28: Proposal Received∎ 2/12: Abe Special Committee meeting∎ 1/29: Regularly scheduled Abe board meeting Proposed Ulysses Timing∎ 2/15: Provide indicative response
∎ 2/6: Abe and Ulysses report Q1’19 results
∎ 3/15: Proposal expires∎ 2/6: Received Abe financial forecasts ∎ 2/7: Received Ulysses financial forecasts
Source: Company filings, Bloomberg, FactSet as of 2/8/2019. 4 (1) Implied all-in XR calculated as equity XR of 0.5x plus $4.03 cash consideration divided by Ulysses share price.
(2) Issuance of shares equivalent to 19.7% of status quo (pre-transaction) Ulysses outstanding shares results in ~16.5% Abe public unitholder ownership in pro forma entity.
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Historical XR and Relative Performance
Two Year Historical Exchange Ratios Relative Performance Since Undisturbed Date (12/3/18)
Abe FGP SPH AMZ
1.40x Prior to Investor Day - Current
0.70x 150% $50
0.60x Proposal Implied XR: 0.5757x
1.20x 0.50x
Average XR: 0.5191x
0.40x 130% Dec-18 Dec-18 Dec-18 Jan-19 Jan-19 Jan-19 Feb-19
1.00x 16% $40
110%
Abe Price / Unit
0.80x (3%) (5%)
Proposed Consideration: 0.5000x + 90% $4.03/unit; Implied XR: 0.5757x $30.14
0.60x $30
(18%)
All-In XR at Proposal
Exchange Ratio XR Premium
Current (2/8/2019) 0.5664x 0.5757x 1.6%
70%
Spot Proposal (1/25/2019) 0.5342x 0.5720x 7.1%
0.40x
Undisturbed (12/3/18) 0.6367x 0.5700x (10.5%) 30-Day 0.5340x 0.5736x 7.4% 60-Day 0.5371x 0.5727x 6.6% Avg. 90-Day 0.5898x 0.5729x (2.9%) 180-Day 0.6822x 0.5744x (15.8%) 360-Day 0.8115x 0.5804x (28.5%)
0.20x 50% $20
Feb-17 May-17 Aug-17 Dec-17 Mar-18 Jun-18 Oct-18 Jan-19 Dec-18 Dec-18 Dec-18 Jan-19 Jan-19 Jan-19 Feb-19
5
_____________________________________ Source: FactSet as of 2/8/2019.
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Analysis at Various Exchange Ratios
($ in millions, unless otherwise noted)
A B C D E F G H I J K L M N
At At Current At Ulysses Undisturbed XR(3) Proposal XR(4)
XR(5)
(2/08/2019) (2/08/2019) (12/03/2018)
Exchange Ratio (At Current Ulysses Sh. Price of $53.21) 0.5500x 0.5664x 0.5757x 0.6000x 0.6367x 0.6500x 0.7000x 0.7500x 0.8000x Premium to Implied Abe Unit Price (Ulysses Share Price x XR) (2.9%) 0.0% 1.6% 5.9% 12.4% 14.8% 23.6% 32.4% 41.2% Implied Abe Unit Price $29.27 $30.14 $30.64 $31.93 $33.88 $34.59 $37.25 $39.91 $42.57 Fully Diluted Abe Units Outstanding 93.8 93.8 93.8 93.8 93.8 93.8 93.8 93.8 93.8 Implied Fully-Diluted Abe Equity Value $2,745 $2,828 $2,874 $2,995 $3,178 $3,245 $3,494 $3,744 $3,993 Net Debt 2,846 2,846 2,846 2,846 2,846 2,846 2,846 2,846 2,846
GP Equity Value(1) 395 395 395 395 395 395 395 395 395
Non-Controlling Interest 32 32 32 32 32 32 32 32 32
Implied Abe Enterprise Value(1) $6,018 $6,100 $6,147 $6,268 $6,451 $6,518 $6,767 $7,017 $7,266
Comparable Metrics
Implied Abe Ownership 22.5% 23.0% 23.3% 24.0% 25.2% 25.5% 27.0% 28.4% 29.7%
Propane Propane Abe Low-Growth Distributor Transaction Multiples: Statistic MLP Median Median(6) Median
EV / 2019E EBITDA $636 9.5x 9.6x 9.7x 9.9x 10.1x 10.3x 10.6x 11.0x 11.4x 9.3x 8.8x 7.5x
Case WS
EV / 2020E EBITDA $644 9.3x 9.5x 9.5x 9.7x 10.0x 10.1x 10.5x 10.9x 11.3x 9.0x 8.4x
Abe
Consensus Equity Value / 2019E DCF(2) $367 7.5x 7.7x 7.8x 8.2x 8.7x 8.8x 9.5x 10.2x 10.9x 6.8x 6.5x Equity Value / 2020E DCF(2) $382 7.2x 7.4x 7.5x 7.8x 8.3x 8.5x 9.2x 9.8x 10.5x 6.2x 6.2x
Propane Propane Abe Low-Growth Distributor Transaction Multiples: Statistic MLP Median Median(6) Median
EV / 2019E EBITDA $625 9.6x 9.8x 9.8x 10.0x 10.3x 10.4x 10.8x 11.2x 11.6x 9.3x 8.8x 7.5x Revised EV / 2020E EBITDA $643 10.1x 10.2x 10.3x 10.5x 10.8x 10.9x 11.3x 11.8x 12.2x 9.0x 8.4x
Budget
Abe Equity Value / 2019E DCF(2) $400 6.9x 7.1x 7.2x 7.5x 7.9x 8.1x 8.7x 9.4x 10.0x 6.8x 6.5x Equity Value / 2020E DCF(2) $410 7.6x 7.8x 7.9x 8.3x 8.8x 9.0x 9.7x 10.4x 11.0x 6.2x 6.2x
Source: Company filings, and FactSet as for 2/8/2019.
(1) GP / IDR value estimated by taking current GP/IDR distributions capitalized by Abe’s current yield. (2) DCF attributable to all unitholders including GP + IDR Interest.
(3) Current unadjusted exchange based on Abe and Ulysses closing prices.
(4) Ulysses Proposal: 0.5000x XR and $4.03 cash consideration / unit. 6 (5) Undisturbed XR is the unaffected XR prior to the investor day on 12/4/2018.
(6) Propane distributor Equity Value / DCF and Yield metrics exclude Ferrellgas from group median.
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II. Status Quo Management Projections Overview
7
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Abe Management Projections
EBITDA DCF and Distributions
Revised Budget Historical Weather Case Revised Budget Historical Weather Case Capital Investment Case Capital Investment Case Wall Street Consensus Projected Distribution Historical Distribution Historical DCF
Historical $720 $4.16
Abe ’19-’23 CAGR: 1.7%
$4.00 $688 $3.96 $3.87 $3.79 $3.78 $3.80 $3.70 $665 $667 $3.72 $3.77 $3.94 $659 $675 $3.71 $3.92 $3.60 $3.80 $644 $3.88 $636 $3.82 $619 $659 $670 $3.44 $3.77 $661 $3.71 $606 $633 $652 $3.32 $3.33 $643 $3.58 $3.59 $3.58 $3.53 $625 $624 $615 $551 $606 $543 $597
2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E Revised Budget 1.15x 1.05x 0.89x 0.88x 0.98x 0.99x 1.00x 1.02x 1.03x 1.04x
Coverage
Historical Weather 1.15x 1.05x 0.89x 0.88x 0.98x 0.99x 0.93x 0.94x 0.94x 0.94x
2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E Case Coverage
Capital Investment 1.15x 1.05x 0.89x 0.88x 0.98x 0.99x 0.97x 1.02x 1.05x 1.10x
Case Coverage
DCF and Distributions with Coverage/Leverage Targets
1.2x 2019E Coverage, Flat Distribution Thereafter Subject to 4.0x Leverage
Revised Budget DCF Targeted Revised Budget Dist. Historical Weather Case DCF Targeted Historical Weather Dist. Capital Investment Case DCF Targeted Capital Investment Dist.
Historical DCF Historical Distribution Historical DCF Historical Distribution Historical DCF Historical Distribution
$3.96 $4.27 $4.08 $4.03 $3.96 $3.96 $3.79 $3.78 $3.80 $4.08 $3.78 $3.86 $3.72 $3.75 $3.96 $3.80 $3.71 $3.71 $3.91 $3.79 $3.78 $3.78 $3.67 $3.72 $3.71 $3.60 $3.60 $3.79 $3.78 $3.80 $3.72 $3.71 $3.77 $3.60 $3.72 $3.44 $3.60 $3.56 $3.44 $3.44 $3.40 $3.32 $3.33 $3.40 $3.32 $3.33 $3.36 $3.32 $3.33 $3.15 $3.15 $3.15 $3.15 $3.15 $3.15 $3.15 $3.15 $3.14 $3.14 $3.14
2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 1.15x 1.05x 0.89x 0.88x 0.98x 1.20x 1.23x 1.26x 1.20x 1.20x 1.15x 1.05x 0.89x 0.88x 0.98x 1.20x 1.14x 1.16x 1.18x 1.19x 1.15x 1.05x 0.89x 0.88x 0.98x 1.20x 1.18x 1.25x 1.20x 1.20x
Revised Budget Coverage Historical Weather Case Coverage Capital Investment Case Coverage
8
___________________________________ Source: Management.
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Ulysses Management Projections
EBITDA Adjusted EPS
Historical Ulysses Utilities Ulysses ’19-’22 CAGR: Wall Street Consensus Management Historical 5.7% $3.70
Abe Propane Ulysses International $3.44
Midstream & Marketing Corporate and other $1,908 $1,807 $3.13 Misc. Income WSC $1,693 $2.90 $1,615 $2.74 $1,520 $3.34 $1,389 $1,421 $3.20 $1,369 $3.05 $1,209 $491 $2.29 $465 $2.02 $2.01 $2.05 $2.74 $2.68 $412 $432
$312 $283 $242 $227
$650 $666 $629 $639
$319 $350 $389 $420
-$13 -$10 -$10 -$11 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E
WSC $1,329 $1,623 $1,684 $1,728 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E
Cash Flow Per Share and Dividends Per Share CapEx
$7.47 Maintanence & Growth Capex Acquisitions $7.27 $923 $6.63 $6.70 $6.13 $844 $5.74 $5.81 $782 $5.52 $5.44 $753 $775$ 15 $15 $725 $719 $666 $10 $448 $102 $187 $61 $474 $37 $1.30 $1.10 $1.20 $1.25 $0.71 $0.71 $0.71 $0.71 $0.71 $605 $624 $594 $436 $475
$753 $709 $760 $829
2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E
Ending Cash $436 $439 $518 $568 $462 $475 $611 $781 $930
Balance 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E
9
Source: Management and Wall Street consensus estimates.
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III. Abe Financial Analysis
10
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Selected Publicly Traded Company Metrics
(USD in millions, except per share data)
Low Growth MLP Metrics & Propane Distributors(1)
A B C D E F G H I J K L M N
Enterprise Value / EBITDA Price / DCF/Unit Distribution Yield Distribution Metrics Debt Metrics Low Growth MLPs
Unit (Share) Total Equity Enterprise Distribution CAGR 2019E Net Debt / S&P Credit Company Name Price Market Value Value 2019E 2020E 2019E 2020E Current 2019E 2019E to 2022E Coverage(2) 2019E EBITDA Rating Buckeye Partners LP $30.95 $4,756 $9,930 11.2x 10.4x 7.1x 5.9x 9.7% 9.7% 4.5% 1.25x 5.8x BBB-
GasLog Partners LP 22.13 1,077 2,531 9.3x 9.0x 10.6x 11.2x 9.6% 10.0% 4.5% 0.93x 4.1x NA Genesis Energy LP 19.95 2,453 6,899 9.9x 9.5x 6.4x 5.4x 11.0% 11.4% 4.6% 1.51x 5.3x B+ Global Partners LP 18.99 679 2,052 9.1x 8.8x 7.3x NA 10.0% 10.0% 0.0% 1.31x 5.8x B+ Golar LNG Partners LP 13.06 1,004 2,221 8.9x 8.7x 5.0x 4.4x 12.4% 12.4% 0.1% 1.06x 4.6x NA Holly Energy Partners LP 28.66 3,027 4,576 12.8x 12.3x 10.6x 10.1x 9.3% 9.4% 0.4% 0.98x 4.0x Ba3 KNOT Offshore Partners LP 18.55 617 1,756 8.4x 8.1x 6.8x 7.1x 11.2% 11.2% 0.0% 1.51x 5.0x NA Martin Midstream Partners LP 12.39 502 1,197 7.3x 6.9x 5.5x 5.4x 16.1% 16.1% 0.0% 1.12x 4.2x B NGL Energy Partners LP 10.87 1,347 3,770 7.6x 7.1x 4.9x 5.0x 14.4% 14.4% 2.7% 1.63x 4.1x B+ NuStar Energy LP 24.68 3,238 7,388 10.8x 10.0x 10.4x 9.2x 9.7% 9.7% 0.0% 0.99x 5.0x BB PBF Logistics LP 21.86 1,167 1,885 10.7x 9.7x 9.3x 7.9x 9.1% 9.5% 2.4% 1.11x 3.1x NA Summit Midstream Partners LP 12.59 1,002 2,498 7.7x 7.2x 4.9x 4.8x 18.3% 18.3% 0.0% 1.12x 3.6x BB-Sunoco LP 29.06 3,080 5,888 9.5x 9.3x 7.8x 7.6x 11.4% 11.4% 0.0% 1.21x 4.5x BB-TC PipeLines LP 30.75 2,354 4,669 10.5x 10.5x 6.5x 6.5x 8.5% 8.5% 0.0% 1.83x 5.0x BBB-USA Compression Partners LP 14.32 1,383 3,604 9.1x 8.5x 6.6x 5.7x 14.7% 14.7% 0.0% 1.05x 4.4x B+
Low $502 $1,197 7.3x 6.9x 4.9x 4.4x 8.5% 8.5% 0.0% 0.93x 3.1x Mean $1,846 $4,058 9.5x 9.1x 7.3x 6.9x 11.7% 11.8% 1.3% 1.24x 4.6x Median $1,347 $3,604 9.3x 9.0x 6.8x 6.2x 11.0% 11.2% 0.0% 1.12x 4.5x High $4,756 $9,930 12.8x 12.3x 10.6x 11.2x 18.3% 18.3% 4.6% 1.83x 5.8x
Propane Distributors(4)
Ferrellgas Partners LP $1.11 $108 $2,119 8.8x 8.4x NM NM NM NM NA NA 8.4x CCC
Suburban Propane Partners LP 21.90 1,372 2,646 9.2x 9.1x 6.8x 6.6x 11.0% 11.0% 5.1% 1.30x 4.4x BB-
Superior Plus Corporation(3) 8.25 1,430 2,716 7.8x 7.4x 6.3x 5.8x 6.6% 6.6% 0.0% 2.40x 3.7x BB
Low $108 $2,119 7.8x 7.4x 6.3x 5.8x 6.6% 6.6% 0.0% 1.30x 3.7x Mean $970 $2,494 8.6x 8.3x 6.5x 6.2x 8.8% 8.8% 2.6% 1.85x 5.5x Median $1,372 $2,646 8.8x 8.4x 6.5x 6.2x 8.8% 8.8% 2.6% 1.85x 4.4x High $1,430 $2,716 9.2x 9.1x 6.8x 6.6x 11.0% 11.0% 5.1% 2.40x 8.4x
Abe Partners, L.P. (WS) $30.14 $3,222 $6,100 9.6x 9.5x 7.8x 7.7x 12.6% 12.6% (4.5%) 1.02x 4.5x NA Abe Partners, L.P. (Revised Budget) 9.8x 9.5x 8.0x 7.9x 12.6% 12.6% 0.0% 0.99x 4.5x NA Abe Partners, L.P. (Historical Weather Case) 9.8x 10.2x 8.0x 8.5x 12.6% 12.6% 0.0% 0.99x 4.8x NA
Abe Partners, L.P. (Capital Investment Case) 9.8x 9.6x 8.0x 8.1x 12.6% 12.6% 0.0% 0.99x 4.5x NA
Source: Company forecasts & filings, investor presentations, Wall Street research and estimates as compiled by FactSet as of 2/8/19. (1) Low growth group defined as MLPs below 5% 2019E-2022E distribution CAGR and with enterprise value between $1.0 BB and $10 BB.
(2) Coverage defined as distributable cash flow divided by total distributions to GP and LP. 11 (3) Uses exchange rate of 0.7534 USD per CAD.
(4) Propane distributor Equity Value / DCF and Yield metrics exclude Ferrellgas from group median.
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Propane Precedent Transactions Analysis
A B C D E F G
Date Transaction EBITDA Purchase Price / Buyer Seller Asset Announced Value ($MM) FY1/NTM EBITDA
5/30/2018 Superior Plus Corporation NGL Energy Partners LP Retail Propane Operations 900 84 10.7x(1) 11/7/2017 DCC LPG NGL Energy Partners LP Retail West 200 28 7.1x
7/24/2017 SHV Energy American Midstream Partners Pinnacle Propane 170 19 9.0x 2/13/2017 Superior Plus Corporation Gibson Energy Canwest Propane 412 33 12.3x 6/23/2016 World Fuel Services PAPCO, Associated Petroleum Products Misc. Fuel Services 230 38 6.0x 5/19/2015 DCC LPG Shell Butagaz 517 136 3.8x 7/2/2014 UGI Corp. Total SA Totalgaz SNC 580 95 6.1x 4/26/2012 Suburban Propane Partners Inergy Retail Propane Assets 1,800 197 9.1x 10/17/2011 AmeriGas Partners, L.P. Energy Transfer Partners Heritage Propane Operations 2,890 325 8.9x 1/4/2010 Inergy Sterling Partners Liberty Propane 223 36 6.2x 11/18/2004 Inergy Star Gas Partners LP Star Gas Propane 475 NA NA
4/20/2004 Ferrellgas Blue Rhino—343 44 7.8x 12/23/2003 Suburban Propane Partners Agway Energy—206 34 6.0x 11/7/2003 Energy Transfer Company Ltd. Heritage Propane Partners—980 119 8.3x 1/31/2001 AmeriGas Partners, L.P. NiSource Columbia Propane 216 NA NA
Low $170 $19 3.8x Mean $676 $91 7.8x Median $412 $44 7.8x High $2,890 $325 12.3x
>$1B Mean $2,345 $261 9.0x
>$1B Median $2,345 $261 9.0x
Current
Ulysses Abe $6,094 $625 9.8x (2/8/2019)
___________________________________ 12 Source: Company filings, Wall Street research, IHS Market.
(1) Transaction multiple before acquisition synergies; 8.2x synergy adjusted multiple.
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PRELIMINARY CONFIDENTIAL DRAFT Abe DCF Analysis Subject to Further Review & Revision
Abe Revised Budget Case | Valuation Effective Date: 3/31/2019 Abe Current Unit Price: $30.14
Implied Proposal Value: $30.64
Discounted Levered DCF Analysis Discounted Levered DCF Analysis
Abe Levered LP DCF | $3.80 Annual Dist. Policy Abe Levered LP DCF | Targeted Leverage & Coverage Policy
2023E DCF Multiple 2023E DCF Multiple
discount rate discount rate discount rate discount rate
6.0x 8.0x 10.0x 6.0x 8.0x 10.0x
8.0% $29.89 $35.91 $41.93 8.0% $30.73 $36.96 $43.20 10.0% $28.41 $34.05 $39.70 10.0% $29.20 $35.04 $40.89 12.0% $27.03 $32.33 $37.64 12.0% $27.78 $33.27 $38.76
Discounted Distribution Analysis Discounted Distribution Analysis
Abe LP Distributions | $3.80 Annual Dist. Policy Abe LP Distributions | Targeted Leverage & Coverage Policy
2023E Distribution Yield 2023E Distribution Yield
13.0% 10.5% 8.0% 13.0% 10.5% 8.0%
8.0% $33.99 $39.30 $47.94 8.0% $29.81 $34.57 $42.30
10.0% $32.24 $37.23 $45.33 10.0% $28.27 $32.73 $39.98
12.0% $30.63 $35.31 $42.92 12.0% $26.84 $31.03 $37.84
PV of Future Unit Price Analysis PV of Future Unit Price Analysis
Abe LP Distributions | $3.80 Annual Dist. Policy Yield Abe LP Distributions | Targeted Leverage & Coverage Policy Yield $48.24 $48.49 $47.71 $46.99
8.0% $40.21 $41.68 $41.47 8.0% $39.99 $38.21 $38.36 $38.50 $37.19 $33.27 10.5% $33.42 $33.86 10.5% $31.88 $32.61 $31.68 $30.40 $30.84 $30.14 $28.34 $30.14 $ 29.18 $26.44 $25.20
13.0% 13.0% Current Current Price Price
2H 2019E 2020E 2021E 2022E 2H 2019E 2020E 2021E 2022E
PV of Future Share Price Assumptions
∎ Management projections ∎ Future share price calculated at FY1 annual distributions divided by yield∎ Valuation date as of 3/31/19∎ Discounted to 3/31/19 at 10% cost of equity
Interim distributions discounted upon receipt to 3/31/19 13 ___________________________________ Source: Management projections and Factset as of 2/8/2019.
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PRELIMINARY CONFIDENTIAL DRAFT Abe DCF Analysis Subject to Further Review & Revision
Abe Historical Weather Case | Valuation Effective Date: 3/31/2019 Abe Current Unit Price: $30.14
Implied Proposal Value: $30.64
Discounted Levered DCF Analysis Discounted Levered DCF Analysis
Abe Levered LP DCF | $3.80 Annual Dist. Policy Abe Levered LP DCF | Targeted Leverage & Coverage Policy
2023E DCF Multiple 2023E DCF Multiple
discount rate discount rate discount rate discount rate
6.0x 8.0x 10.0x 6.0x 8.0x 10.0x
8.0% $27.45 $32.93 $38.40 8.0% $28.44 $34.16 $39.89 10.0% $26.10 $31.23 $36.37 10.0% $27.03 $32.40 $37.77 12.0% $24.85 $29.67 $34.49 12.0% $25.73 $30.77 $35.80
Discounted Distribution Analysis Discounted Distribution Analysis
Abe LP Distributions | $3.80 Annual Dist. Policy Abe LP Distributions | Targeted Leverage & Coverage Policy
13.0% 10.5% 8.0% 13.0% 10.5% 8.0%
8.0% $33.99 $39.30 $47.94 8.0% $28.18 $32.59 $39.75
10.0% $32.24 $37.23 $45.33 10.0% $26.74 $30.87 $37.59
12.0% $30.63 $35.31 $42.92 12.0% $25.40 $29.28 $35.59
PV of Future Share Price Analysis PV of Future Share Price Analysis
Abe LP Distributions | $3.80 Annual Dist. Policy Yield Abe LP Distributions | Targeted Leverage & Coverage Policy Yield $48.24 $48.49 $47.71 $46.99
8.0% $40.21 8.0% $39.99 $39.55 $38.96 $38.21 $38.36 $38.50 $37.19 $33.27 10.5% 10.5% $31.88 $32.61 $31.68 $31.81 $31.92 $30.40 $30.84 $30.14 $25.20 $26.44 $27.04 $30.14 $ 27.58
13.0% 13.0% Current Current Price Price
2023E Distribution Yield 2023E Distribution Yield
2H 2019E 2020E 2021E 2022E 2H 2019E 2020E 2021E 2022E
PV of Future Share Price Assumptions
∎ Management projections ∎ Future share price calculated at FY1 annual distributions divided by yield∎ Valuation date as of 3/31/19∎ Discounted to 3/31/19 at 10% cost of equity
Interim distributions discounted upon receipt to 3/31/19 14 ___________________________________ Source: Management projections and Factset as of 2/8/2019.
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PRELIMINARY CONFIDENTIAL DRAFT Abe DCF Analysis Subject to Further Review & Revision
Abe Capital Investment Case | Valuation Effective Date: 3/31/2019 Abe Current Unit Price: $30.14
Implied Proposal Value: $30.64
Discounted Levered DCF Analysis Discounted Levered DCF Analysis
Abe Levered LP DCF | $3.80 Annual Dist. Policy Abe Levered LP DCF | Targeted Leverage & Coverage Policy
2023E DCF Multiple 2023E DCF Multiple
discount rate discount rate discount rate discount rate
6.0x 8.0x 10.0x 6.0x 8.0x 10.0x
8.0% $30.84 $37.20 $43.56 8.0% $31.45 $37.97 $44.50 10.0% $29.29 $35.26 $41.22 10.0% $29.87 $35.99 $42.10 12.0% $27.86 $33.46 $39.06 12.0% $28.40 $34.15 $39.89
Discounted Distribution Analysis Discounted Distribution Analysis
Abe LP Distributions | $3.80 Annual Dist. Policy Abe LP Distributions | Targeted Leverage & Coverage Policy
13.0% 10.5% 8.0% 13.0% 10.5% 8.0%
8.0% $33.99 $39.30 $47.94 8.0% $30.74 $35.72 $43.81
10.0% $32.24 $37.23 $45.33 10.0% $29.14 $33.81 $41.39
12.0% $30.63 $35.31 $42.92 12.0% $27.66 $32.04 $39.16
PV of Future Share Price Analysis PV of Future Share Price Analysis
Abe LP Distributions | $3.80 Annual Dist. Policy Yield Abe LP Distributions | Targeted Leverage & Coverage Policy Yield $48.24 $48.49 $47.71 $46.99 8.0% $42.10 $42.95 8.0% $39.85 $40.06 $38.21 $38.36 $38.50 $37.19 $34.99 $33.27 10.5% $33.74 10.5% $31.88 $32.61 $31.56 $30.40 $30.72 $30.10 $28.59 $30.14 $26.34 $30.14 $25.11
13.0% 13.0% Current Current Price Price
2023E Distribution Yield 2023E Distribution Yield
2H 2019E 2020E 2021E 2022E 2H 2019E 2020E 2021E 2022E
PV of Future Share Price Assumptions
∎ Management projections ∎ Future share price calculated at FY1 annual distributions divided by yield∎ Valuation date as of 3/31/19∎ Discounted to 3/31/19 at 10% cost of equity
Interim distributions discounted upon receipt to 3/31/19 15 ___________________________________ Source: Management projections and Factset as of 2/8/2019.
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IV. Ulysses Financial Analysis
16
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Selected Publicly Traded Company Metrics
(USD in millions, except per share data)
A B C D E F G H I J K L M M O P N
LDCs EV / EBITDA Price / Earnings Price / CFPS Dividend Metrics Debt Metrics
Share Total Equity Enterprise Payout Dist. CAGR Net Debt / S&P Credit LT EPS Company Name Price Value Value 2019E 2020E 2019E 2020E 2019E 2020E Current 2019E Ratio(2) 19E to ‘21E EBITDA Rating Growth Rate Atmos Energy $97.97 $11,505 $14,972 12.6x 11.3x 22.5x 21.0x 12.6x 11.0x 2.1% 2.1% 56.7% 8.0% 2.9x NA 6.5% Chesapeake Utilities Corporation 88.11 1,455 1,969 13.4x 12.6x 23.9x 22.5x NA NA 1.7% 1.8% 44.1% 10.4% 3.5x NA 7.6% NiSource Inc 26.58 9,706 18,800 11.3x 10.7x 19.8x 18.6x 8.9x 8.6x 3.0% 3.1% 128.1% 4.1% 5.0x BBB+ 5.7% New Jersey Resources Corporation 45.95 4,099 5,564 19.4x (1) 17.7x (1) 23.0x 21.4x 17.1x 14.5x 2.5% 2.6% 80.6% NA 5.1x NA 6.0% Northwest Natural Holding Co. 61.94 1,789 2,675 11.5x 11.0x 25.2x 24.0x 10.2x 10.7x 3.1% 3.1% 55.6% 0.7% 3.8x A+ 4.5% ONE Gas Inc 84.02 4,445 5,634 11.9x 11.2x 24.5x 23.7x 12.4x 11.5x 2.4% 2.4% 65.0% 7.7% 2.5x A 5.0% Spire Inc 78.55 4,329 6,980 13.8x 12.9x 21.1x 20.2x 11.2x 10.9x 3.0% 3.0% 68.0% 5.1% 5.2x A- 5.0% Southwest Gas Holdings Inc 78.50 4,187 6,051 9.1x 8.4x 19.7x 18.5x 7.8x 8.1x 2.6% 2.8% 51.5% 6.9% 2.8x BBB+ 6.0%
C-Corp Midstream EV / EBITDA Price / Earnings Price / DCF/Unit Dividend (Distribution) Metrics Debt Metrics
Unit (Share) Market Enterprise 2019E Dist. CAGR 2019E S&P Credit 19E to ‘22E Company Name Price Value Value 2019E 2020E 2019E 2020E 2019E 2020E Current 2019E Coverage(4) ‘19E to ‘22E EBITDA Rating DCF CAGR Enbridge Inc $36.10 $73,089 $134,867 13.6x 12.1x 19.3x 16.4x 10.0x 9.0x 6.2% 6.2% 1.5x 3.2% 4.8x BBB+ 6.9% Kinder Morgan Inc 18.02 41,005 76,387 9.9x 9.5x 17.7x 16.7x 8.3x 7.7x 4.4% 5.5% 2.2x 14.5% 4.3x BBB 4.5% SemGroup Corporation 15.32 1,367 3,955 9.0x 8.1x 21.9x 16.3x 5.1x 4.8x 12.3% 13.1% 1.5x 5.3% 5.9x B+ 5.2% Targa Resources Corp. 42.67 9,913 17,151 11.2x 8.9x NM 32.1x 11.1x 7.3x 8.5% 8.5% 1.1x 4.4% 3.8x BB 15.6% Tallgrass Energy LP 22.92 6,476 10,002 10.4x 11.2x 13.1x 16.8x 9.3x 9.2x 8.9% 9.5% 1.3x 4.7% 3.2x BBB- (0.7%) Williams Companies Inc 26.88 33,480 57,087 11.3x 10.6x 28.1x 24.9x 10.5x 9.6x 5.1% 5.7% 1.7x 9.4% 4.4x BBB 19.4%
Low $1,455 $1,969 9.1x 8.4x 19.7x 18.5x 7.8x 8.1x 1.7% 1.8% 44.1% 0.7% 2.5x 4.5% Mean $5,189 $7,831 12.0x 11.2x 22.5x 21.2x 11.5x 10.8x 2.6% 2.6% 68.7% 6.1% 3.9x 5.8% Median $4,258 $5,843 11.9x 11.2x 22.8x 21.2x 11.2x 10.9x 2.6% 2.7% 60.8% 6.9% 3.7x 5.9% <60% Payout Ratio Median $2,988 $4,363 12.1x 11.2x 23.2x 21.8x 10.2x 10.7x 2.4% 2.5% 53.6% 7.4% 3.2x 6.3% High $11,505 $18,800 13.8x 12.9x 25.2x 24.0x 17.1x 14.5x 3.1% 3.1% 128.1% 10.4% 5.2x 7.6%
Low $1,367 $3,955 9.0x 8.1x 13.1x 16.3x 5.1x 4.8x 4.4% 5.5% 1.1x 3.2% 3.2x (0.7%) Mean $27,555 $49,908 10.9x 10.1x 20.0x 20.5x 9.0x 7.9x 7.6% 8.1% 1.6x 6.9% 4.4x 8.5% Median $21,697 $37,119 10.8x 10.1x 19.3x 16.7x 9.7x 8.3x 7.3% 7.3% 1.5x 5.0% 4.4x 6.0% High $73,089 $134,867 13.6x 12.1x 28.1x 32.1x 11.1x 9.6x 12.3% 13.1% 2.2x 14.5% 5.9x 19.4%
Low $108 $2,119 7.8x 7.4x 9.9x 9.0x 6.3x 5.8x 6.6% 6.6% 0.0% 1.30x 3.7x 3.9% Mean $970 $2,494 8.6x 8.3x 9.9x 9.0x 6.5x 6.2x 8.8% 8.8% 2.6% 1.85x 5.5x 14.0% Median $1,372 $2,646 8.8x 8.4x 9.9x 9.0x 6.5x 6.2x 8.8% 8.8% 2.6% 1.85x 4.4x 5.0% High $1,430 $2,716 9.2x 9.1x 9.9x 9.0x 6.8x 6.6x 11.0% 11.0% 5.1% 2.40x 8.4x 33.2%
Propane Distributors(5) EV / EBITDA Price / Earnings Price / DCF/Unit Dividend (Distribution) Metrics Debt Metrics
Ferrellgas Partners LP $1.11 $108 $2,119 8.8x 8.4x NM NM NM NM NM NM NA NA 8.4x CCC 33.2% Suburban Propane Partners LP 21.90 1,372 2,646 9.2x 9.1x NM NM 6.8x 6.6x 11.0% 11.0% 5.1% 1.30x 4.4x BB- 3.9% Superior Plus Corporation(6) 8.25 1,430 2,716 7.8x 7.4x 9.9x 9.0x 6.3x 5.8x 6.6% 6.6% 0.0% 2.40x 3.7x BB 5.0%
Ulysses Corporation (WS) $53.21 $9,459 $15,955 12.0x 9.8x 19.9x 17.4x 9.8x(3) 8.2x(3) 2.0% 2.1% 47.5% 5.4% 3.3x NA 8.0% Ulysses Corporation (Mgmt.) 9.9x 9.4x 18.2x 17.0x 8.6x(3) 7.4x(3) 2.0% 2.0% 35-45% 4.0% 2.7x NA 6-10%
Source: Company forecasts & filings, investor presentations, Wall Street research and estimates (3) P/CFPS shown for Ulysses. as compiled by FactSet as of 2/8/19. (4) Coverage defined as distributable cash flow divided by total distributions.
(1) New Jersey Resources Corporation 2019E and 2020E EBITDA multiples are excluded from (5) Propane distributor Equity Value / DCF and Yield metrics exclude Ferrellgas from group summary statistics due to disproportionately high multiples resulting from investment tax median. 17 credit benefits for the company’s solar assets. (6) Uses exchange rate of 0.7534 USD per CAD.
(2) Payout ratio defined as last quarter dividend divided by LTM earnings.
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PRELIMINARY CONFIDENTIAL DRAFT
Ulysses DCF Analysis | Management Projections Subje to Further Review & Revision
Valuation Effective Date: 3/31/2019
Discounted Unlevered DCF(1) Analysis Discounted Dividend Analysis
Ulysses SQ Dividends | Abe $3.80 Annual Dist. Policy
2023E EBITDA Terminal Multiple 2023E Distribution Yield
discount rate discount rate
8.50x 10.0x 11.5x 2.75% 2.25% 1.75%
4.00% $56.76 $71.32 $85.89 4.50% $45.03 $54.40 $69.14 4.75% $55.19 $69.50 $83.80 5.25% $44.25 $53.46 $67.94 5.50% $53.66 $67.71 $81.77 6.00% $43.50 $52.55 $66.77
Discounted Unlevered DCF Analysis(1,2) Discounted Dividend Analysis
Supplemental Calculation Detail Supplemental Calculation Detail
2H 2019E 2020E 2021E 2022E 2H 2019E 2020E 2021E 2022E
EBITDA $805 $1,697 $1,808 $1,903 Ulysses Dividend / Share $0.55 $1.20 $1.25 $1.30
Unlevered Cash Taxes(3) (88) (173) (166)
Capex (377) (719) (775) Discount Factor 0.987 0.950 0.903 FCF $340 $804 $867 PV of Dividend/Sh. $0.54 $1.14 $1.12
Discount Factor 0.988 0.955 0.911
Disc. FCF $337 $768 $790 Disc. GP Dist. Total $2.80
Disc. SQ Ulysses FCF Total $1,895 Terminal Yield 2.25% Terminal M ultiple 10.0x Terminal Disc. Factor 0.890x Terminal Disc. Factor 0.880
Implied Terminal PV EV $16,946 Implied Terminal PV per Share $50.66
Less SQ Ulysses Net Debt ($4,392) Less SQ Ulysses NCI ($2,103)
Implied Equity Value per Share $53.46
Implied SQ Ulysses Equity Value $12,345 SQ Ulysses Equity Value per Share $69.50
PV of Future Share Price Analysis(4)
Ulysses SQ / PF Dividends Yield $68.09 $69.32 $69.63
1.75%
Assumptions $54.78 $53.08 $54.29
∎ Wall Street Consensus Projections $53.21 2.25% $43.53 $44.72 $45.33
∎ Valuation date as of 3/31/19
∎ Future share price calculated at FY1 annual dividends divided by yield 2.75%
∎ Discounted to 3/31/19 at 5.25% cost of equity Current
Price
â–¡ Interim distributions discounted upon receipt to 3/31/19
Source: Management projections. 2H 2019E 2020E 2021E (1) Net Income attributable to non-controlling interests is included in consolidated EBITDA; DCF analysis assumes normalized net working capital.
(2) Fully consolidated enterprise value analysis; implied Ulysses share price calculated based on eliminating Abe publicly-owned LP interest at market value. 18 (3) Calculated as management-forecasted cash taxable income + elimination of tax shield from interest expense.
(4) Dividend policy assumed constant in both SQ and PF scenarios , across all operating scenarios.
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SQ Ulysses Sum-of-the-Parts Analysis
Ulysses SOTP SQ EBITDA Mix(3)
FY 2019E Multiple(1) Enterprise Value
FY 2019E EBITDA Low High Low High
SQ Ulysses Businesss Segments Midstream
Abe & Marketing
Midstream & Marketing $230 9.5x 11.5x $2,189 $2,650 20% 19% Utilities $324 10.0x 12.0x $3,243 $3,891
International $420 8.0x 10.0x $3,358 $4,197 Total Enterprise Value $8,790 $10,739 Less Net Debt ($1,547) ($1,547) Equity Value $7,243 $9,192
FY 2019E GP/IDR
Cashflow FY 2019E Distribution Yield(2) Equity Value International Utilities
34% 27%
Abe
GP Equity Value $50 12.6% 12.6% $395 $395 Abe FD LP Equity Value $2,828 $2,828 Abe Equity Value $3,223 $3,223 Less Abe NCI ($2,103) ($2,103) Total SQ Ulysses Equity Value $8,363 $10,312 Ulysses FD Shares O/S 177.8 177.8
Implied SQ Ulysses Share Price $47.04 $58.01
Source: Management Projections and FactSet as of 2/8/2019.
Note: Corporate revenue & other income / expenses allocated pro-rata to business units on basis of business unit contribution of gross revenue / gross expenses respectively.
1. Based on comparable C-Corp, LDC’s, and Propane Distributors median 2019E EV/EBITDA.
2. Based on Abe 2019E distribution yield. 19
3. Total EBITDA attributable to Ulysses shareholders, excluding portion attributable to noncontrolling interest in Abe. Abe EBITDA allocated ~38% to Ulysses unitholders, proportionately to distributions received.
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V. Transaction Analysis
20
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PRELIMINARY CONFIDENTIAL DRAFT Has / Gets Analysis | Abe Base Case Subject to Further Review & Revision
Abe Pre – Unitholder Tax | Valuation Effective Date: 3/31/2019 Abe $3.80 Annual Dist. Policy
Targeted Leverage & Coverage Policy
Has-Standalone Abe Implied Unit Price Gets-XR Adjusted PF Ulysses Implied Share Price |0.5757x XR(1)
Discounted Cash Flow | Unlevered FCF(2)
2023E DCF Multiple 2023E DCF Multiple
2023E Distribution Yield 2023E Distribution Yield
discount rate discount rate discount rate discount rate
6.0x 8.0x 10.0x Analysis 8.0% $29.89 $35.91 $41.93
2022E Terminal Multiple
DCF 10.0% $28.41 $34.05 $39.70 12.0% $27.03 $32.33 $37.64
8.5x 10.0x 11.5x Levered te 4.00% $32.34 $38.44 $44.54
Discounted Distribution Analysis Discounted Levered DCF Analysis
Discount Rate Discount Rate
6.0x 8.0x 10.0x
4.75% $31.68 $37.67 $43.67
8.0% $30.73 $36.96 $43.20 scount
D i
Discounted 10.0% $29.20 $35.04 $40.89 5.50% $31.04 $36.93 $42.81 12.0% $27.78 $33.27 $38.76
Discounted Dividend Analysis
13.0% 10.5% 8.0%
2022E Distribution Yield
Analysis 8.0% $33.99 $39.30 $47.94 10.0% $32.24 $37.23 $45.33 2.75% 2.25% 1.75%
12.0% $30.63 $35.31 $42.92
4.50% $26.54 $31.23 $38.60
Rate
Distribution t
n 5.25% $26.16 $30.76 $38.00 o u
13.0% 10.5% 8.0%
Disc
8.0% $29.81 $34.57 $42.30 6.00% $25.78 $30.30 $37.41
Discounted 10.0% $28.27 $32.73 $39.98
12.0% $26.84 $31.03 $37.84
Source: Management projections and FactSet as of 2/8/2019. 21 (1) Implied XR at 0.5000x equity XR and cash consideration of $4.03 / unit. Cash consideration added to implied share price at 0.5000x XR.
(2) Unlevered free cash flow defined as PF Ulysses EBITDA less cash taxes and capital expenditures.
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PRELIMINARY CONFIDENTIAL DRAFT
Has / Gets Analysis | Abe Historical Weather Case Subject to Further Review & Revision
Abe Pre – Unitholder Tax | Valuation Effective Date: 3/31/2019 Abe $3.80 Annual Dist. Policy
Targeted Leverage & Coverage Policy
Stand Alone Abe Implied Unit Price
2023E DCF Multiple
Discount Rate
Discounted Levered DCF Analysis
2023E DCF Multiple
Discount Rate
2023E Distribution Yield
Discount Rate
Discounted Distribution Analysis
2023E Distribution Yield
Discount Rate
XR Adjusted PF Ulysses Implied Share Price |0.5757x XR(1)
Discounted Cash Flow | Unlevered FCF(2) | Discounted at WACC
2022E Terminal Multiple
Discount Rate
Discounted Distribution Analysis
2022E Distribution Yield
Discount Rate
Source: Management projections and FactSet as of 2/8/2019.
(1) Implied XR at 0.5000x equity XR and cash consideration of $4.03 / unit. Cash consideration added to implied share price at 0.5000x XR. (2) Unlevered free cash flow defined as PF Ulysses EBITDA less cash taxes and capital expenditures.
6.0x 8.0x 10.0x 8.0% $27.45 $32.93 $38.40 10.0% $26.10 $31.23 $36.37 12.0% $24.85 $29.67 $34.49
6.0x 8.0x 10.0x 8.0% $28.44 $34.16 $39.89 10.0% $27.03 $32.40 $37.77 12.0% $25.73 $30.77 $35.80
13.0% 10.5% 8.0% 8.0% $33.99 $39.30 $47.94 10.0% $32.24 $37.23 $45.33 12.0% $30.63 $35.31 $42.92
13.0% 10.5% 8.0% 8.0% $28.18 $32.59 $39.75 10.0% $26.74 $30.87 $37.59 12.0% $25.40 $29.28 $35.59
8.5x 10.0x 11.5x 4.00% $31.31 $37.27 $43.22 4.75% $30.67 $36.52 $42.37 5.50% $30.04 $35.79 $41.53
2.75% 2.25% 1.75% 4.50% $26.54 $31.23 $38.60 5.25% $26.16 $30.76 $38.00 6.00% $25.78 $30.30 $37.41
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PRELIMINARY CONFIDENTIAL DRAFT
Has / Gets Analysis | Abe Capital Investment Case Subject to Further Review & Revision
Abe Pre – Unitholder Tax | Valuation Effective Date: 3/31/2019 Abe $3.80 Annual Dist. Policy
Targeted Leverage & Coverage Policy
Stand Alone Abe Implied Unit Price XR Adjusted PF Ulysses Implied Share Price |0.5757x XR(1)
2023E DCF Multiple 2023E DCF Multiple
2023E Distribution Yield 2023E Distribution Yield
discount rate discount rate discount rate discount rate
Discounted Cash Flow | Unlevered FCF(2) | Discounted at WACC
6.0x 8.0x 10.0x Analysis 8.0% $30.84 $37.20 $43.56
2022E Terminal Multiple
DCF 10.0% $29.29 $35.26 $41.22 12.0% $27.86 $33.46 $39.06
8.5x 10.0x 11.5x Levered te 4.00% $32.75 $38.94 $45.13
6.0x 8.0x 10.0x
4.75% $32.09 $38.16 $44.24
8.0% $31.45 $37.97 $44.50 Discounted Levered dcf analysis
Discounted 10.0% $29.87 $35.99 $42.10 5.50% $31.44 $37.40 $43.37 12.0% $28.40 $34.15 $39.89
Discounted Distribution Analysis
13.0% 10.5% 8.0%
2022E Distribution Yield
Analysis 8.0% $33.99 $39.30 $47.94 10.0% $32.24 $37.23 $45.33 2.75% 2.25% 1.75%
12.0% $30.63 $35.31 $42.92
4.50% $26.54 $31.23 $38.60
5.25% $26.16 $30.76 $38.00 o u
13.0% 10.5% 8.0%
8.0% $30.74 $35.72 $43.81 6.00% $25.78 $30.30 $37.41
Discounted 10.0% $29.14 $33.81 $41.39
12.0% $27.66 $32.04 $39.16
Source: Management projections and FactSet as of 2/8/2019. 23 (1) Implied XR at 0.5000x equity XR and cash consideration of $4.03 / unit. Cash consideration added to implied share price at 0.5000x XR.
(2) Unlevered free cash flow defined as PF Ulysses EBITDA less cash taxes and capital expenditures.
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PRELIMINARY CONFIDENTIAL DRAFT Accretion / (Dilution) Subject to Further Review & Revision
Pre – Unitholder Tax(1) | Abe Base Case
Abe Distribution Accretion / (Dilution)—%
At 0.5757x Exchange Ratio No Cut Cut
Assumptions
(78.1%) (77.2%) (77.8%)
∎ All-in XR applied to calculate pro forma share count as if (80.0%) cash component is utilized to purchase secondary Ulysses shares by current Abe unitholders (81.1%) (80.4%)
(83.4%) (81.9%) (77.2%) (77.8%) (78.1%) (80.0%)
∎ Estimates of pro forma CFPS incorporate step-up 743(b) tax 2019E 2020E 2021E 2022E depreciation and cash taxes
(81.9%) (81.1%) (80.4%)
∎ EBITDA synergies of $5 MM per year per Ulysses management (83. $3.4%) 80 $3.80 $3.80 $3.80 included in pro forma forecast 2019E $3.15 2020E $3.15 2021E $3.15 $ 2022E 3.36 $0.63 $0.69 $0.72 $0.75
($3.17) ($3.11) ($3.08) ($3.05) Status Quo Abe (No Cut): ($ $3. 2.80 52) ($ $3. 2.80 46) ($ $2. 3.43) 80 ($ $2. 3.61) 80
Status Quo Abe (Cut): (1) $3.15 $3.15 $3.15 $3.36
Pro Forma Ulysses at 0.5757x: $0.63 $0.69 $0.72 $0.75 $ Acc / (Dil) (No Cut): ($3.17) ($3.11) ($3.08) ($3.05) $ Acc / (Dil) (Cut): ($2.52) ($2.46) ($2.43) ($2.61)
Ulysses EPS Accretion / (Dilution)—% Ulysses CFPS Accretion / (Dilution)—%
0.3%
(0.9%) (1.6%) (2.5%)
(6.6%) (7.2%) (7.0%) (8.2%)
2019E 2020E 2021E 2022E 2019E 2020E 2021E 2022E
Status Quo Ulysses: $2.90 $3.13 $3.44 $3.70 Status Quo Ulysses: $5.81 $6.70 $7.27 $7.47 Pro Forma Ulysses: $2.66 $2.90 $3.20 $3.46 Pro Forma Ulysses: $5.67 $6.72 $7.20 $7.35 $ Acc / (Dil): ($0.24) ($0.23) ($0.24) ($0.25) $ Acc / (Dil): ($0.14) $0.02 ($0.06) ($0.12)
___________________________________ 24 Source: Management projections and FactSet as of 2/8/2019.
(1) Pre – Unitholder Tax; 0.5757x represents implied XR at 0.5000x equity XR and cash consideration of $4.03 / unit.
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Precedents & Premiums | MLP Transactions Analysis
A B C F E D G H I J K
Announcement Equity Adj. Transaction Transaction Unaffected 1-Day Taxable Buyer Transaction Acquiror Target % Cash Date Value Acquired Value(1,3) Value Premium Transaction Type Type
11/26/18 Dominion Energy Inc Dominion Energy Midstream Partners LP $1,262 $3,584 $3,598 0.9% 0% No C-Corp Affiliate 11/26/18 Arclight Capital TransMontaigne Partners L.P. 536 1,232 1,247 12.6% 100% NA PE Affiliate 11/8/18 Western Gas Equity Partners LP Western Gas Partners, LP 5,763 12,603 12,781 7.6% 0% No MLP Affiliate 10/22/18 EnLink Midstream LLC EnLink Midstream Partners, L.P. 5,084 12,221 12,236 1.1% 0% Yes C-Corp Affiliate 10/18/18 Valero Energy Corporation Valero Energy Partners LP 1,976 3,734 3,788 6.0% 100% Yes C-Corp Affiliate 10/9/18
Antero Midstream GP LP Antero Midstream Partners LP 5,908 7,548 7,548 6.5% 11% Yes C-Corp Affiliate 9/18/18 Enbridge Inc. Enbridge Energy Partners 2,742 15,541 15,562 11.6% 0% Yes C-Corp Affiliate 8/24/18 Enbridge Inc. Spectra Energy Partners, LP 3,276 26,945 27,810 19.4% 0% Yes C-Corp Affiliate 8/1/18 Energy Transfer Equity, L.P. Energy Transfer Partners 27,179 66,915 66,981 11.2% 0% No MLP Affiliate 6/19/18 Cheniere Energy Inc. Cheniere Energy Partners LP Holdings 1,240 5,526 5,651 10.7% 0% No C-Corp Affiliate 5/17/18 Williams Companies Williams Partners, LP 10,427 56,013 57,793 16.5% 0% Yes C-Corp Affiliate 3/26/18 Tall Grass Energy GP, LP Tallgrass Energy Partners, LP 1,686 8,083 8,361 (18.4%) 0% Yes C-Corp Affiliate 2/7/18 Terra Nitrogen GP, Inc. Terra Nitrogen Co. LP 387 1,432 1,474 3.7% 100% Yes C-Corp Affiliate 1/2/18 Archrock, Inc Archrock Partners, LP 607 2,358 2,438 23.4% 0% Yes C-Corp Affiliate 8/29/17 Zenith Energy US, LP Arc Logistics Partners LP 407 736 736 15.2% 100% Yes PE 3rd Party 10/25/16 Energy Transfer Partners, LP PennTex Midstream Partners, LP 640 789 789 43.3% 50% Yes MLP Affiliate 3/2/17 VTTI, B.V VTTI Energy Partners, LP 481 1,842 1,867 6.0% 100% Yes C-Corp Affiliate 4/3/17 World Point Terminals, Inc. World Point Terminals, LP 159 570 594 5.8% 100% Yes C-Corp Affiliate 2/1/17 ONEOK, Inc ONEOK Partners, LP 9,309 22,380 23,654 25.8% 0% Yes C-Corp Affiliate 1/27/17 Enbridge Energy Company Midcoast Energy Partners, LP 170 1,194 1,176 (8.6%) 100% Yes C-Corp Affiliate 11/21/16 Sunoco Logistics Partners, LP Energy Transfer Partners, LP 21,965 54,455 54,455 (0.2%) 0% No MLP Affiliate 10/24/16 American Midstream Partners LP JP Energy Partners LP 302 476 476 9.1% 0% No MLP 3rd Party 9/26/16 Transcanada Columbia Pipeline Partners 915 3,384 3,464 9.9% 100% Yes C-Corp Affiliate 5/30/16 SemGroup Corp. Rose Rock Midstream 771 2,034 2,034 0.0% 0% Yes C-Corp Affiliate 11/3/15 Targa Resources Corp. Targa Resources Partners LP 6,672 12,138 12,229 18.4% 0% Yes C-Corp Affiliate 8/1/16 Transocean, Inc Transocean Partners 259 1,153 1,202 20.8% 0% No C-Corp Affiliate 10/26/15 Western Refining, Inc. Northern Tier Energy 1,982 5,185 5,286 11.7% 65% Yes C-Corp 3rd Party 7/13/15 MPLX LP MarkWest Energy Partners, LP 16,612 22,360 22,360 36.3% 8% No MLP 3rd Party 5/6/15 Crestwood Equity Partners, LP Crestwood Midstream Partners 3,381 6,901 6,920 17.2% 0% No MLP Affiliate 4/6/15 Tesoro Logistics LP QEP Midstream Partners LP 394 1,104 1,145 (14.0%) 0% No MLP Affiliate 1/26/15 Energy Transfer Partners, LP Regency Energy Partners LP 11,276 18,593 18,593 13.2% 1% No MLP Affiliate 10/26/14 Williams Partners LP Access Midstream Partners LP 21,944 34,256 34,256 (5.7%) 0% No MLP Affiliate 10/13/14 Targa Resources Partners LP Atlas Pipeline Partners LP 3,866 6,002 6,002 15.0% 3% No MLP 3rd Party 11/12/14 Enterprise Products Partners LP Oiltanking Partners LP 1,392 4,243 4,289 (0.9%) 0% No PE Affiliate 8/10/14 Kinder Morgan Inc. Kinder Morgan Energy Partners 27,351 52,351 52,566 12.0% 12% Yes C-Corp Affiliate 8/10/14 Kinder Morgan Inc. El Paso Pipeline Partners 5,421 13,193 13,677 15.4% 12% Yes C-Corp Affiliate 7/24/14 Breitburn Energy Partners QR Energy LP 1,811 2,856 2,856 17.5% 19% No MLP 3rd Party 10/10/13 Regency Energy Partners LP PVR Partners LP 3,931 5,659 5,659 25.7% 1% No MLP 3rd Party 8/27/13 Plains All American LP PAA Natural Gas Storage LP 755 2,434 2,531 8.5% 0% No MLP Affiliate 5/6/13 Inergy Midstream LP Crestwood Midstream Partners LP 1,661 2,643 2,643 14.5% 4% No MLP 3rd Party 1/29/13 Kinder Morgan Energy Partners LP Copano Energy LLC 3,911 4,858 4,858 23.5% 0% No MLP 3rd Party 2/23/11 Enterprise Products Partners Duncan Energy Partners LP 1,006 2,973 3,282 28.1% 0% No MLP Affiliate
Current (2/8/2019) Ulysses Abe $2,121 $5,659 $5,671 1.6% 13% Yes C-Corp Affiliate Current Premium to Abe at Proposal Date Ulysses Abe $2,121 $5,659 5,671 2.5% 13% Yes C-Corp Affiliate (1/25/2019) Current Premium to Abe at Pre-Investor Day Ulysses Abe $2,121 $5,659 5,671 (16.5%) 13% Yes C-Corp Affiliate
Median $1,831 $5,355 $5,469 10.3% 0% C-Corp Buying MLP Mean 4,004 11,746 12,000 9.0% 32% Median $1,686 $5,526 $5,651 9.9% 0% Affiliate Mean 5,525 13,931 14,121 9.3% 24% Median $1,976 $5,185 $5,286 11.6% 12% Taxable Transaction Mean 4,113 11,889 12,147 10.7% 40% Median $1,894 $5,021 $5,072 11.7% 0% Overall Mean 5,162 12,155 12,306 11.3% 23%
___________________________________ (12/3/2018)
Source: Company filings, press releases, presentations and FactSet for pricing data. Represents precedent MLP transactions by affiliated and third party MLPs, Public GPs and C-Corps since 2011.
Note: Considers transactions where target is an MLP. 25 (1) Based on Wall Street research.
(2) Non-adjusted transaction TEV values affiliated and non-affiliated units at offer price.
(3) Adjusted transaction TEV value affiliated units at market price and non-affiliated units at offer price.
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PRELIMINARY CONFIDENTIAL DRAFT Subject to Further Review & Revision
Supplemental Analysis
26
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT
Illustrative Transaction Tax Implications Subject to Further Review & Revision
At Proposal | With and Without State Taxes SUBJECT TO TAX COUNSEL REVIEW
FY 1H 2019E Basis Unitholder Trade Group(2) Active Units % of Public Basis(3) Ordinary Gain(3) Capital Gain(3)
Average Tax Basis Calculation(1) January 2018A Tax Basis $13.41 May 1995—Dec. 2010 12,044,321 17% $0.04 $4.97 $0.34 (+) FY 2018A Q2-Q4 Allocated Net Income Jan. 2011—Dec. 2013 10,693,961 15% $1.07 $4.20 ($0.53) 0.57 Jan. 2014—Dec. 2014 11,715,648 17% $2.01 $4.31 ($1.12)
∎ The average tax paid with and without state
(+) FY 2019E Q1-Q2 Allocated Net Income 0.95
Jan. 2015—Dec. 2015 6,423,910 9% $1.38 $2.13 ($0.67)
taxes is $9.94 & $8.60 respectively per unit for
public Abe unitholders as of 2H 2019 (-) FY 2018A Q2, Q3, & Q4 Distributions 2.85 Jan. 2016—Dec. 2016 14,091,793 20% $3.25 $4.11 ($1.11) (-) FY 2019E Q1-Q2 Distributions 1.90 Jan. 2017—Dec. 2017 12,903,239 19% $5.03 $2.67 ($1.98) FY 1H 2019E Basis $10.18 Jan. 2018—Jan. 2018 1,182,662 2% $0.63 $0.12 ($0.22) Total 69,055,533 100% $13.41 $22.52 ($5.30)
Detailed Calculation of Ordinary and Capital Gains
Average Unitholder Average Unitholder
UGI Share Price $53.21 UGI Share Price $53.21 Exchange Ratio 0.5000x Exchange Ratio 0.5000x Cash Consideration $4.03 Cash Consideration $4.03 Offer Price $30.64 Offer Price $30.64
Average 1H 2019E Tax Basis $10.18 Average 1H 2019E Tax Basis $10.18 Detail of Gains (per Unit) Detail of Gains (per Unit)
Average Ordinary Gain / (Loss)(4) $25.75 Average Ordinary Gain / (Loss)(4) $25.75 Average Capital Gain / (Loss)(4) (5.30) Average Capital Gain / (Loss)(4) (5.30)
Total Gain $20.46 Total Gain $20.46 Tax on Gain (per Unit) Tax on Gain (per Unit)
Federal Ordinary Income Tax Rate 37.0% Federal Ordinary Income Tax Rate 37.0% Individual MLP Investor Deduction Rate 20.0% Individual MLP Investor Deduction Rate 20.0% Adjusted Ordinary Tax Rate 29.6% Adjusted Ordinary Tax Rate 29.6% ACA Tax 3.8% ACA Tax 3.8% Federal Tax Rate 33.4% Federal Tax Rate 33.4% Federal Capital Gains Tax Rate 23.8% Federal Capital Gains Tax Rate 23.8% Effective State Tax Rate(3) 0.0% Effective State Tax Rate(3) 5.2% Tax on Ordinary Gain $8.60 Tax on Ordinary Gain $8.60
Effective Ordinary Gain Tax Rate 33.4% Effective Ordinary Gain Tax Rate 33.4%
Tax on Capital Gain ($1.26) Tax on Capital Gain ($1.26)
Effective Capital Gain Tax Rate 23.8% Effective Capital Gain Tax Rate 23.8%
State Tax Ordinary Income(5) $0.00 State Tax Ordinary Income(5) $1.34
Effective Ordinary Gain Tax Rate 0.0% Effective Ordinary Gain Tax Rate 5.2%
State Tax Capital Gain(5) $0.00 State Tax Capital Gain(5) ($0.27)
Effective Capital Gains Tax Rate 0.0% Effective Capital Gains Tax Rate 5.2%
Total Tax on Gain(6) $8.60 Total Tax on Gain(6) $9.94
___________________________________ Total Effective Tax Rate 33.4% Total Effective Tax Rate 38.6%
Source: Company Management, FactSet as of 2/8/2019 and Wall Street research. (1) Provided by management.
(2) Trade group and active unitholder data as of January 31, 2018.
(3) Weighted average by active unit as a percent of total outstanding active units. 27 (4) Capital and Ordinary gains as of Jan. 2018; incremental ordinary gains due to rolled forward basis added to ordinary gains.
(5) Per discussions with management, state tax rate determined by using a weighted average of 50 state income tax rates and median federal taxable income brackets for married and single filers. (6) Taxes Payable on Ordinary gain not offset by Capital losses.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT Subject to Further Review & Revision
Net Tax Exchange Ratio Calculation Detail
SUBJECT TO TAX COUNSEL REVIEW
A B C D E F G H I
Secondary Equity Equity
Gross Cash Cash Net Cash Shares Net After-Component (1) All-In XR Taxes Payable Component Consideration Component XR Consideration Purchased / Tax XR
XR XR (2) (Sold)
At proposal $4.03 0.5000x 0.0757x 0.5757x ($9.94) ($5.91) 0.5000x (0.1110x) 0.3890x
_____________________________________ 28 Source: FactSet as of 2/8/2019.
(1) Based on Ulysses spot price.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT SQ Abe After Tax Cash Flow Subject to Further Review & Revision
10.5% Terminal Yield Value | Abe $3.80 Annual Dist. Policy
SUBJECT TO TAX COUNSEL REVIEW
2H 2019E 2020E 2021E 2022E 2023E
BT LP Distribution Per Unit $1.90 $3.80 $3.80 $3.80 $3.80 AT LP Distribution Per Unit $1.87 $3.74 $3.74 $3.74 $3.74 Discount Factor 0.976 0.909 0.826 0.751 0.683 PV of LP Dist. per Unit $1.83 $3.40 $3.09 $2.81 $2.56
Disc. LP Dist. Total $13.69 Terminal Yield 10.5% Implied Terminal Future Value per Unit $36.19
Average Purchase Price $40.08 Existing RoC ($29.90)
Beginning Tax Basis $10.18
2H 2019E 2020E 2021E 2022E 2023E
Beg. Avg. Tax Basis / Unit $10.18 $9.47 $8.18 $6.95 $5.80 Less: Distributions / Unit (1.90) (3.80) (3.80) (3.80) (3.80) Plus: Net Income Allocated 1.20 2.50 2.57 2.65 2.72
Avg. EOY Basis / Unit $9.47 $8.18 $6.95 $5.80 $4.71
Implied Terminal Value per Unit $36.19 Less: Basis at EOY 2023E ($4.71)
Gain Subject to Tax $31.48 Capital Gain $1.72 Ordinary Gain $29.75
Total Gain $31.48
Total Tax on Gain per Unit
Tax on Ordinary Gain - 33.4% $9.94 Tax on Capital Gain - 23.8% 0.41 State Tax on Ordinary Income - 5.2% 1.54 State Tax on Capital Gain - 5.2% 0.09
Total Tax on Gain $11.98
Total Effective Tax Rate 38.1%
After-Tax Future Value per Unit $24.21
Terminal Disc. Factor 0.651
Implied Present Value per Unit at 11% Terminal Yield $29.46
Source: Management projections and FactSet as of 2/8/2019. 29 Note: Discounted at midpoint discount rate of 10%.
(1) Inclusive of Federal & State capital gains taxes.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT SQ Abe After Tax Cash Flow Subject to Further Review & Revision
10.5% Terminal Yield Value | Targeted Leverage & Coverage Policy
SUBJECT TO TAX COUNSEL REVIEW
2H 2019E 2020E 2021E 2022E 2023E
BT LP Distribution Per Unit $1.58 $3.15 $3.15 $3.36 $3.36 AT LP Distribution Per Unit $1.55 $3.09 $3.09 $3.30 $3.30 Discount Factor 0.976 0.909 0.826 0.751 0.683 PV of LP Dist. per Unit $1.51 $2.81 $2.55 $2.48 $2.25
Disc. LP Dist. Total $11.61 Terminal Yield 10.5% Implied Terminal Future Value per Unit $31.96
Average Purchase Price $40.08 Existing RoC ($29.90)
Beginning Tax Basis $10.18
2H 2019E 2020E 2021E 2022E 2023E
Beg. Avg. Tax Basis / Unit $10.18 $9.93 $9.61 $9.43 $9.13 Less: Distributions / Unit (1.58) (3.15) (3.15) (3.36) (3.36) Plus: Net Income Allocated 1.33 2.83 2.97 3.05 3.16
Avg. EOY Basis / Unit $9.93 $9.61 $9.43 $9.13 $8.94
Implied Terminal Value per Unit $31.96 Less: Basis at EOY 2023E ($8.94)
Gain Subject to Tax $23.03 Capital Gain ($6.73) Ordinary Gain $29.75
Total Gain $29.75
Total Tax on Gain per Unit
Tax on Ordinary Gain - 33.4% $9.94 Tax on Capital Gain - 23.8% 0.00 State Tax on Ordinary Income - 5.2% 1.54 State Tax on Capital Gain - 5.2% 0.00
Total Tax on Gain $11.48
Total Effective Tax Rate 38.6%
After-Tax Future Value per Unit $20.48
Terminal Disc. Factor 0.651
Implied Present Value per Unit at 11% Terminal Yield $24.95
Source: Management projections and FactSet as of 2/8/2019. 30 Note: Discounted at midpoint discount rate of 10%.
(1) Inclusive of Federal & State capital gains taxes.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT PF Ulysses After Tax Cash Flow Subject to Further Review & Revision
21.0x Terminal P/E Value
At 0.3890x Exchange Ratio SUBJECT TO TAX COUNSEL REVIEW
2H 2019E 2020E 2021E 2022E Terminal Tax Basis at 1H 2019E $10.18 Stepped Up Basis Upon Close $30.64
PF Ulysses Earnings per Share $3.46 • Abe current price of
$30.14 as of
XR Adj. PF Ulysses Earnings per Share $1.34
PF Ulysses BT Dist. per Share $0.55 $1.20 $1.25 $1.30 2/8/2019
• Cash consideration
XR Adj. PF Ulysses BT Dist. per Share $0.21 $0.47 $0.48 $0.50 used to pay part of
% RoC 0% 0% 0% 0% taxes for an
% QD 100% 100% 100% 100% average public Abe
unitholder;
Return of Capital $0.00 $0.00 $0.00 $0.00 additional cash Qualified Dividends ($0.05) ($0.11) ($0.12) ($0.12) made available by Project Tax Liability ($0.05) ($0.11) ($0.12) ($0.12) Ulysses secondary
shares
XR Adj. PF Ulysses AT Dist. per Share $0.16 $0.35 $0.37 $0.38
Terminal P/E 21.0x Sale at 9/30/22—Terminal FV per XR Adj. PF Ulysses Share $28.23 Less: Basis on Conversion ($30.64) Plus: Dividends Treated as Return of Capital $0.00 Gain on Sale Tax Rate(1) ($2.40) Tax on Gain 29.0% $0.00
Sale at 9/30/22—Terminal FV per XR Adj. PF Ulysses Share $28.23 Less: Taxes on Gain $0.00 Net Proceeds $28.23
Total Net Cash Flow $0.16 $0.35 $0.37 $0.38 $28.23 Total Cash In Flow $0.21 $0.47 $0.48 $0.50 $28.23 Total Cash Out Flow—Tax on
($0.05) ($0.11) ($0.12) ($0.12) $0.00 Dividends Discount Factor 0.987 0.950 0.903 0.858 0.836 Implied Present Value per Share $0.16 $0.34 $0.33 $0.33 $23.60
XR Adj. PF Ulysses Implied Present Value per Share $24.76
Source: Management projections and FactSet as of 2/8/2019.
Note: Discounted at midpoint discount rate of 5.25%. 31 Note: QD / RoC split is per management guidance.
(1) Inclusive of Federal & State capital gains taxes.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT Summary of Material Changes Subject to Further Review & Revision
Updates since 2/12/2019 Materials
∎ Adjusted terminal distributable cash flow multiple range to 6.0x – 10.0x for Abe Dscounted Distributable Cash Flow analysis∎ Adjusted terminal yield range to 8.0% – 13.0% for Abe Discounted Distribution analysis∎ Incorporated two additional corporate propane precedent transactions∎ Adjusted to unlevered cash taxes in Ulysses Unlevered Discounted Cash Flow Analysis
32
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT Subject to Further Review & Revision
Appendix
33
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT Abe DCF Analysis Subject to Further Review & Revision
Abe Revised Budget Case | Valuation Effective Date: 3/31/2019
Discounted Levered DCF Analysis Discounted Distribution Analysis
Supplemental Calculation Detail | $3.80 Annual Dist. Policy Supplemental Calculation Detail | $3.80 Annual Dist. Policy
2H 2019E 2020E 2021E 2022E 2023E 2H 2019E 2020E 2021E 2022E 2023E
LP DCF per Unit $1.88 $3.82 $3.88 $3.92 $3.94 LP Distribution Per Unit $1.90 $3.80 $3.80 $3.80 $3.80 Discount Factor 0.976 0.909 0.826 0.751 Discount Factor 0.976 0.909 0.826 0.751 PV of LP DCF per Unit $1.84 $3.47 $3.21 $2.94 PV of LP Dist. per Unit $1.86 $3.45 $3.14 $2.85 Disc. LP DCF Total $11.46 Disc. LP Dist. Total $11.31 Terminal Mulitple 8.0x Terminal Yield 10.5% Terminal Disc. Factor 0.716 Terminal Disc. Factor 0.716 Implied Terminal Value per Unit $22.59 Implied Terminal PV per Unit $25.93
Implied Present Value per Unit $34.05 Implied Equity Value per Unit $37.23
LP DCF / LP Dist. Coverage 0.99x 1.00x 1.02x 1.03x 1.04x LP DCF / LP Dist. Coverage 0.99x 1.00x 1.02x 1.03x 1.04x Total Debt / EBITDA 4.61x 4.59x 4.61x 4.65x 4.62x Total Debt / EBITDA 4.61x 4.59x 4.61x 4.65x 4.62x
Discounted Levered DCF Analysis Discounted Distribution Analysis
Supplemental Calculation Detail | Targeted Leverage & Coverage Policy Supplemental Calculation Detail | Targeted Leverage & Coverage Policy
2H 2019E 2020E 2021E 2022E 2023E 2H 2019E 2020E 2021E 2022E 2023E
LP DCF per Unit $1.89 $3.86 $3.96 $4.03 $4.08 LP Distribution Per Unit $1.58 $3.15 $3.15 $3.36 $3.40 Discount Factor 0.976 0.909 0.826 0.751 Discount Factor 0.976 0.909 0.826 0.751 PV of LP DCF per Unit $1.85 $3.51 $3.27 $3.03 PV of LP Dist. per Unit $1.54 $2.86 $2.60 $2.52 Disc. LP DCF Total $11.66 Disc. LP Dist. Total $9.53 Terminal Mulitple 8.0x Terminal Yield 10.5% Terminal Disc. Factor 0.716 Terminal Disc. Factor 0.716 Implied Terminal Value per Unit $23.39 Implied Terminal PV per Unit $23.20
Implied Present Value per Unit $35.04 Implied Equity Value per Unit $32.73
LP DCF / LP Dist. Coverage 1.20x 1.23x 1.26x 1.20x 1.20x LP DCF / LP Dist. Coverage 1.20x 1.23x 1.26x 1.20x 1.20x Total Debt / EBITDA 4.45x 4.27x 4.11x 3.99x 3.85x Total Debt / EBITDA 4.45x 4.27x 4.11x 3.99x 3.85x
___________________________________ 34 Source: Management projections.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT Abe DCF Analysis Subject to Further Review & Revision
Abe Historical Weather Case | Valuation Effective Date: 3/31/2019
Discounted Levered DCF Analysis Discounted Distribution Analysis
Supplemental Calculation Detail | $3.80 Annual Dist. Policy Supplemental Calculation Detail | $3.80 Annual Dist. Policy
2H 2019E 2020E 2021E 2022E 2023E 2H 2019E 2020E 2021E 2022E 2023E
LP DCF per Unit $1.88 $3.53 $3.58 $3.59 $3.58 LP Distribution Per Unit $1.90 $3.80 $3.80 $3.80 $3.80 Discount Factor 0.976 0.909 0.826 0.751 Discount Factor 0.976 0.909 0.826 0.751 PV of LP DCF per Unit $1.84 $3.21 $2.96 $2.69 PV of LP Dist. per Unit $1.86 $3.45 $3.14 $2.85 Disc. LP DCF Total $10.70 Disc. LP Dist. Total $11.31 Terminal Mulitple 8.0x Terminal Yield 10.5% Terminal Disc. Factor 0.716 Terminal Disc. Factor 0.716 Implied Terminal Value per Unit $20.53 Implied Terminal PV per Unit $25.93
Implied Present Value per Unit $31.23 Implied Equity Value per Unit $37.23
LP DCF / LP Dist. Coverage 0.99x 0.93x 0.94x 0.94x 0.94x LP DCF / LP Dist. Coverage 0.99x 0.93x 0.94x 0.94x 0.94x Total Debt / EBITDA 4.61x 5.10x 5.29x 5.52x 5.58x Total Debt / EBITDA 4.61x 5.10x 5.29x 5.52x 5.58x
Discounted Levered DCF Analysis Discounted Distribution Analysis
Supplemental Calculation Detail | Targeted Leverage & Coverage Policy Supplemental Calculation Detail | Targeted Leverage & Coverage Policy
2H 2019E 2020E 2021E 2022E 2023E 2H 2019E 2020E 2021E 2022E 2023E
LP DCF per Unit $1.89 $3.60 $3.67 $3.71 $3.75 LP Distribution Per Unit $1.58 $3.15 $3.15 $3.15 $3.15 Discount Factor 0.976 0.909 0.826 0.751 Discount Factor 0.976 0.909 0.826 0.751 PV of LP DCF per Unit $1.85 $3.27 $3.03 $2.79 PV of LP Dist. per Unit $1.54 $2.86 $2.60 $2.37 Disc. LP DCF Total $10.94 Disc. LP Dist. Total $9.37 Terminal Mulitple 8.0x Terminal Yield 10.5% Terminal Disc. Factor 0.716 Terminal Disc. Factor 0.716 Implied Terminal Value per Unit $21.46 Implied Terminal PV per Unit $21.50
Implied Present Value per Unit $32.40 Implied Equity Value per Unit $30.87
LP DCF / LP Dist. Coverage 1.20x 1.14x 1.16x 1.18x 1.19x LP DCF / LP Dist. Coverage 1.20x 1.14x 1.16x 1.18x 1.19x Total Debt / EBITDA 4.45x 4.75x 4.75x 4.77x 4.65x Total Debt / EBITDA 4.45x 4.75x 4.75x 4.77x 4.65x
___________________________________ 35 Source: Management projections.
Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT Abe DCF Analysis Subject to Further Review & Revision
Abe Capital Investment Case | Valuation Effective Date: 3/31/2019
Discounted Levered DCF Analysis Discounted Distribution Analysis
Supplemental Calculation Detail | $3.80 Annual Dist. Policy Supplemental Calculation Detail | $3.80 Annual Dist. Policy
2H 2019E 2020E 2021E 2022E 2023E 2H 2019E 2020E 2021E 2022E 2023E
LP DCF per Unit $1.88 $3.70 $3.87 $4.00 $4.16 LP Distribution Per Unit $1.90 $3.80 $3.80 $3.80 $3.80 Discount Factor 0.976 0.909 0.826 0.751 Discount Factor 0.976 0.909 0.826 0.751 PV of LP DCF per Unit $1.84 $3.37 $3.20 $3.01 PV of LP Dist. per Unit $1.86 $3.45 $3.14 $2.85 Disc. LP DCF Total $11.41 Disc. LP Dist. Total
$11.31 Terminal Mulitple 8.0x Terminal Yield 10.5% Terminal Disc. Factor 0.716 Terminal Disc. Factor 0.716 Implied Terminal Value per Unit $23.85 Implied Terminal PV per Unit $25.93
Implied Present Value per Unit $35.26 Implied Equity Value per Unit $37.23
LP DCF / LP Dist. Coverage 0.99x 0.97x 1.02x 1.05x 1.10x LP DCF / LP Dist. Coverage 0.99x 0.97x 1.02x 1.05x 1.10x Total Debt / EBITDA 4.61x 4.73x 4.63x 4.48x 4.26x Total Debt / EBITDA 4.61x 4.73x 4.63x 4.48x 4.26x
Discounted Levered DCF Analysis Discounted Distribution Analysis
Supplemental Calculation Detail | Targeted Leverage & Coverage Policy Supplemental Calculation Detail | Targeted Leverage & Coverage Policy
2H 2019E 2020E 2021E 2022E 2023E 2H 2019E 2020E 2021E 2022E 2023E
LP DCF per Unit $1.88 $3.72 $3.91 $4.08 $4.27 LP Distribution Per Unit $1.57 $3.14 $3.14 $3.40 $3.56 Discount Factor 0.976 0.909 0.826 0.751 Discount Factor 0.976 0.909 0.826 0.751 PV of LP DCF per Unit $1.84 $3.38 $3.23 $3.06 PV of LP Dist. per Unit $1.53 $2.85 $2.59 $2.55 Disc. LP DCF Total $11.52 Disc. LP Dist. Total $9.53 Terminal Mulitple 8.0x Terminal Yield 10.5% Terminal Disc. Factor 0.716 Terminal Disc. Factor 0.716 Implied Terminal Value per Unit $24.47 Implied Terminal PV per Unit $24.27
Implied Present Value per Unit $35.99 Implied Equity Value per Unit $33.81
LP DCF / LP Dist. Coverage 1.20x 1.18x 1.25x 1.20x 1.20x LP DCF / LP Dist. Coverage 1.20x 1.18x 1.25x 1.20x 1.20x Total Debt / EBITDA 4.61x 4.57x 4.31x 3.99x 3.68x Total Debt / EBITDA 4.61x 4.57x 4.31x 3.99x 3.68x
___________________________________ 36 Source: Management projections.
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Cost of Capital
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Tudorpickering Holt&co energy investment & merchant banking

PRELIMINARY CONFIDENTIAL DRAFT SQ Abe Cost of Equity Analysis Subject to Further Review & Revision
Comparable Public Company Yield-Based Cost of Equity
Abe Cost of Equity Cost of Equity
Barra Beta Low High Sensitized Peer Total Return Low High
(2)
Raw Beta 0.68 0.92
(3)
Spot Risk-Free Rate 2.9% 2.9%
(4)
Equity Risk Premium 6.0% 6.0%
Cost of Equity 7.0% 8.5% Cost of Equity 14.1% 15.1%
A B C D E F
Expected Total Return
Expected 2019E—2022E Long-Term Economic
Company Distribution CAGR Growth Estimate Expected Growth(1) Current Yield Implied Total Return
Buckeye Partners LP 4.5% 4.0% 4.1% 9.7% 13.8% GasLog Partners LP 4.5% 4.0% 4.1% 9.6% 13.7% Genesis Energy LP 4.6% 4.0% 4.1% 11.0% 15.1% Global Partners LP 0.0% 4.0% 3.4% 10.0% 13.4% MLPs Golar LNG Partners LP 0.1% 4.0% 3.4% 12.4% 15.8% Holly Energy Partners LP 0.4% 4.0% 3.5% 9.3% 12.8% KNOT Offshore Partners LP 0.0% 4.0% 3.4% 11.2% 14.6% Growth Martin Midstream Partners LP 0.0% 4.0% 3.4% 16.1% 19.5% NGL Energy Partners LP 2.7% 4.0% 3.8% 14.4% 18.2% Low NuStar Energy LP 0.0% 4.0% 3.4% 9.7% 13.1% PBF Logistics LP 2.4% 4.0% 3.8% 9.1% 12.9% Summit Midstream Partners LP 0.0% 4.0% 3.4% 18.3% 21.7% Sunoco LP 0.0% 4.0% 3.4% 11.4% 14.8% TC PipeLines LP 0.0% 4.0% 3.4% 8.5% 11.9% USA Compression Partners LP 0.0% 4.0% 3.4% 14.7% 18.1% NA NA NA NA
Ferrellgas Partners LP NA
Dist. Suburban Propane Partners LP 5.1% 4.0% 4.2% 11.0% 15.1% Propane Superior Plus Corporation 0.0% 4.0% 3.4% 6.6% 10.0%
Median 0.0% 4.0% 3.4% 11.0% 14.6% Mean 1.4% 4.0% 3.6% 11.3% 15.0%
______________________________________________ Source: Bloomberg, Duff & Phelps, FactSet, Federal Reserve, Company filings as of 2/8/2019.
(1) Weights Expected Current – 2020E distribution growth estimates 15% and long-term economic growth estimate by 85% to arrive at a long-term distribution growth estimate.
(2) Barra beta as of 12/31/2018. Illustrative low and high range reflects a -/+ 15% range around Barra beta.
(3) 20-year treasury bond yield as of 1/29/2019. 38 (4) Duff & Phelps historical arithmetic premium.
(5) 2021E dividend from May 8th, 2018 RBC equity research report.
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Ulysses Cost of Capital Analysis
Status Quo Pro Forma Cost of Equity Cost of Equity
Barra Beta Low High Barra Beta Low High Raw Beta (3) 0.30 0.41 Raw Beta (3) 0.30 0.41
(4) (4)
Spot Risk-Free Rate 2.9% 2.9% Spot Risk-Free Rate 2.9% 2.9%
Equity Risk Premium(5) 6.0% 6.0% Equity Risk Premium(5) 6.0% 6.0%
Cost of Equity 4.7% 5.4% Cost of Equity 4.7% 5.4%
Cost of Capital Cost of Capital
Barra Beta | SQ Capital Structure Low High Barra Beta | PF Capital Structure Low High
Cost of Equity 4.7% 5.4% Cost of Equity 4.7% 5.4% Cost of Debt(1) 2.7% 4.2% Cost of Debt(2) 3.5% 5.0%
Market Value of Equity $9,459 $9,459 Market Value of Equity $13,187 $13,187 Total Debt $2,756 $2,756 Total Debt $4,905 $4,905
Cost of Capital 4.3% 5.1% Cost of Capital 4.2% 5.0%
Cost of Capital Cost of Capital
Barra Beta | Optimal Capital Structure(6) Low High Barra Beta | Optimal Capital Structure(6) Low High
Cost of Equity 4.7% 5.4% Cost of Equity 4.7% 5.4%
(1) (2)
Cost of Debt 2.7% 4.2% Cost of Debt 3.5% 5.0%
Market Value of Equity $9,459 $9,459 Market Value of Equity $13,187 $13,187 Total Debt $2,542 $2,542 Total Debt $3,966 $3,966
Cost of Capital 4.3% 5.1% Cost of Capital 4.2% 5.1%
Source: Bloomberg, Duff & Phelps, FactSet, Federal Reserve, Company filings as of 2/8/2019.
Note: In SQ, debt held at Abe is proportionally consolidated based on LP ownership in the MLP. In PF, debt held at Abe is assumed to be fully consolidated and the cash consideration of $4.03 for each Abe unit is funded using the Ulysses revolver at a 2.275% interest rate. Equity - Based on a 0.500x XR of Ulysses shares for each Abe unit.
(1) Illustrative low and high range reflects a -/+ 100 bps range around after tax current 4.55% cost of debt at Ulysses. Ulysses cost of debt calculated using weighted average 7-10 year YTW on the outstanding face value of debt held at Ulysses. (2) Illustrative low and high range reflects a -/+ 100 bps range around after tax current 5.56% cost of debt at Ulysses. Ulysses cost of debt calculated using weighted average 7-10 year YTW on the outstanding face value of fully consolidated Ulysses debt.
(3) Barra beta for Ulysses as of 12/31/2018. Illustrative low and high range reflects a -/+ 15% range around Barra beta. 39 (4) 20-year treasury bond yield as of 1/29/2019.
(5) Duff & Phelps historical arithmetic premium.
(6) Optimal Capital Structure based on Total Debt/2019E EBITDA Ratio of 3.00x.
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