8-KSecurities & Listing

Energy Transfer LP 8-K Report, Listing Notice (Aug 2, 2011)

Filed August 2, 2011For Securities:ETET-PI

Summary

This 8-K filing from Energy Transfer Equity, L.P. (the "Partnership") addresses a notification to the New York Stock Exchange (NYSE) regarding a temporary noncompliance with listing standards. Specifically, the resignation of two independent directors from the Partnership's Audit Committee, Messrs. Bill W. Byrne and Paul E. Glaske, on June 30, 2011, resulted in the committee falling below the required minimum of three independent directors. This was a consequence of their appointments to the conflicts committee of Energy Transfer Partners, L.P. (ETP) in connection with a significant proposed merger and asset contribution. The Partnership has formally notified the NYSE of this issue and has outlined its plan to rectify the situation. The Board of Directors intends to appoint an additional independent director to the Audit Committee, or otherwise ensure compliance with the three independent director requirement, by the end of 2011. Investors should monitor the company's progress in filling this vacancy to ensure continued adherence to NYSE listing rules and maintain confidence in the governance structure.

Key Highlights

  • 1Energy Transfer Equity, L.P. notified the NYSE on July 29, 2011, of a deficiency in its Audit Committee composition.
  • 2Two independent directors resigned from the Partnership's Audit Committee effective June 30, 2011.
  • 3The resignations were related to the directors serving on the conflicts committee for Energy Transfer Partners, L.P. (ETP) in connection with a proposed merger and asset contribution.
  • 4The Audit Committee fell below the NYSE requirement of having at least three independent directors.
  • 5The Partnership's Board plans to appoint another independent director to the Audit Committee by December 31, 2011.
  • 6The company is actively working to regain compliance with NYSE corporate governance listing standards.

Frequently Asked Questions

This 8-K filing is a notification to the NYSE that Energy Transfer Equity, L.P. is temporarily not in compliance with the requirement for its Audit Committee to have at least three independent directors, due to the recent resignations of two directors.

The two independent directors, Bill W. Byrne and Paul E. Glaske, resigned to serve on the conflicts committee of Energy Transfer Partners, L.P. (ETP) in connection with a significant proposed merger involving Southern Union Company and a related asset contribution.

The Partnership's Board of Directors intends to appoint an additional independent director to the Audit Committee, or otherwise ensure the committee has three independent directors, by December 31, 2011.

While noncompliance with listing standards can lead to delisting, the NYSE typically provides companies with a cure period to rectify such issues. The company has a stated intention to appoint a new director by the end of the year, which should address the noncompliance and prevent delisting.