TEEKAY GROUP MARINE MONEY NYC November 14, 2017

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1 TEEKAY GROUP MARINE MONEY NYC November 14, 2017

2 Recent Transactions Two strategic transactions across the Teekay Group o Teekay and Teekay Offshore completed their strategic partnership with Brookfield, which significantly strengthens their financial positions o Two leading independent proxy advisory firms have both recommended to vote FOR Teekay Tankers proposed charter amendment to permit its merger with Tanker Investments Ltd., which owns 18 mid-size tankers Teekay LNG has secured a further $327 million in long-term financing for its newbuild program and completed a $170 million preferred equity offering 2

3 Phased Approach to a Sustainable TOO Focused on reducing overall leverage and increasing liquidity 1. Comprehensive recapitalization plan to build liquidity and strengthen balance sheets o Play defense while energy and capital markets are weak 2. Optimize asset portfolio and balance sheet o Asset sales, redeployment of assets, complete refinancings, reduce leverage, etc. 3. Position businesses for long-term sustainability and to benefit from recovery in energy markets Brookfield Solution 3

4 Strategic Partnership Teekay operational platform + Brookfield s global business platform and access to capital creates one of the world s strongest offshore infrastructure companies Brookfield attracted to TOO s high quality contracted cash flows and market leading positions in the offshore production and logistics space $640 million equity investment significantly strengthens TOO s balance sheet and improves liquidity Fully finances TOO s existing growth projects, which will provide significant near-term cash flow growth Positions Teekay Offshore to better service its customers and take advantage of future growth opportunities Brookfield offers strong strategic alignment and complementary capabilities o Operational and capital allocation expertise o Geographical footprint o Partnering model o Track record of investing in the energy value chain 4

5 Brookfield Asset Management Overview Leader in alternative investing across major asset classes Property $148 Billion AUM Renewable Power $30 Billion AUM Infrastructure $32 Billion AUM Private Equity $18 Billion AUM Core Office Core Retail Opportunistic Hydroelectric Wind Utilities Transport Energy Communications Sustainable Infrastructure Resources Sustainable Resources Construction Services Other Business Services Energy Other Industries Brookfield Asset Management is publicly listed on the New York, Toronto and Euronext stock exchanges and has a market capitalization of approximately $35 billion Brookfield has an investment grade S&P credit rating of A- Notes: 1) AUM excludes Public Securities, cash and financial assets and other assets 2) Public Securities (managed by Brookfield Investment Management) AUM is approximately $11 billion and also includes real estate and infrastructure securities, real asset debt and diversified real asset strategies 5

6 Brookfield Asset Management - Energy Businesses Overview Extensive experience owning and operating businesses in the energy supply chain through global partnerships ~17,000 km of natural gas transmission pipelines in the U.S. and Brazil 600 billion cubic feet of natural gas storage in the U.S. and Canada District energy systems delivering heating and cooling to customers from centralized systems in the U.S., Canada and Australia Oil and gas exploration and production 100,000+ barrel of oil equivalent per day of oil and gas production Well and drilling services 6

7 Transforms TOO s Capital Structure Stabilizing equity base $610m (Brookfield) + $30m (TK) of new TOO common equity at $2.50 per unit plus warrants Common unit distributions reduced to $0.01/quarter Reducing high cost capital on preferred equity Pref. C-1s retired with cash, at a discount to par (cash savings of $18m p.a.) Pref. Ds retired with cash, at a discount to par (cash savings of $10m p.a.), plus a reduction in the exercise price of the second tranche of warrants Extending maturities on debt and swaps TK sold an existing $200m parent loan to Brookfield at a discount to par and Brookfield extended loan maturity to 2022 Refinanced a significant portion of existing TOO NOK bonds due in late-2018 / early-2019 with proceeds from a new, 5-year, $250m unsecured bond at carve out Teekay Shuttle Tankers New, 5-year, $600m facility at Teekay Shuttle Tankers to refinance a majority of the shuttle tanker fleet and extend term Extended the mandatory prepayment on the Arendal Spirit UMS debt facility out to September 30, 2018 Extended termination options on certain interest rate swaps by 2-years (2021), released TK guarantee and reset rate Enhancing capacity for growth Fully finances existing growth projects delivering through Q1-18 Ordered two shuttle tanker newbuilds + options for two additional vessels 7

8 Investing in our Market Leading Shuttle Franchise Strategic partnership allows us to pursue attractive investment opportunities TOO has ordered two Suezmax-size, DP2 shuttle tanker newbuildings, plus options for two additional vessels at Samsung Heavy Industries Vessels will be based on Teekay s New Shuttle Spirit design the next generation of shuttle tankers LNG fueled Lower consumption North Sea supply and demand (2) Lower emissions Vessels will deliver in late-2019 and early-2020 to service TOO s existing Master Agreement with Statoil ASA in the North Sea (1) Excludes cost of Volatile Organic Compound (VOC) plant which will be fully reimbursable by the Norwegian government. (2) TOO estimates. 8

9 Key Ingredients to a Transformative Transaction Experienced team with strong stakeholder relationships DNB as Advisors Commercial Banks Bondholders Customers TEAM - Aligned - Small and dedicated - Driven - Empowered - Cross-functional - Communicative Private Equity Board of Directors Preferred holders Legal Advisors 9

10 Promising Future for TOO Market leading positions Stable and growing cash flows Attractive Markets Capital to pursue future growth Co-sponsors focused on maximizing shareholder value 10

11 Key Stakeholder Feedback - TOO Stakeholder Response to Brookfield Transaction Banks Significantly strengthens TOO and the Teekay Group overall Partial pre-payment of swaps and loans (e.g. Arendal) improves TOO credit quality Unsecured bonds ShuttleCo NOK bondholders very supportive due to improvement in credit quality 2019 refinancings more certain given retained cash flow and Brookfield sponsorship Preferred equity Generally satisfied with return of capital (vs. potential recovery under alternatives) Common equity Value enhancing in long-term due to improvement in financial position and improved cash flow with the removal of high-cost financings Improved access to public and private capital for growth Introduction of strong new sponsor general excitement over ability to grow the business Customers Viewed positively - strengthens TOO and the Teekay Group overall Employees Tears (Norway staff: of joy; Project team: from sleep deprivation) 11