8-KMaterial AgreementsExhibits & Filings

Energy Transfer LP 8-K Report, Material Agreement (May 3, 2016)

Filed May 3, 2016For Securities:ETET-PI

Summary

This 8-K filing from Energy Transfer LP (ET) on May 3, 2016, primarily details an amendment to the Agreement and Plan of Merger with The Williams Companies, Inc. (Williams). The amendment primarily addresses the timing and delivery of election forms for Williams stockholders regarding their merger consideration and synchronizes this with the mailing of the proxy statement/prospectus. Notably, the SEC has requested additional disclosure for the proxy statement, delaying its effectiveness and the mailing of these materials. This regulatory review process, coupled with a substantial risk that a crucial tax opinion (the "721 Opinion") required for closing may not be obtained, introduces significant uncertainty into the completion of the merger. Investors should be aware of these ongoing delays and potential impediments to the transaction.

Key Highlights

  • 1Amendment to the merger agreement with Williams primarily concerns the timing and delivery process for stockholder election forms.
  • 2The mailing of the Form of Election will now coincide with the mailing of the proxy statement/prospectus.
  • 3SEC has requested additional disclosures in the proxy statement/prospectus, which is currently under review and not yet effective.
  • 4There is a substantial risk that the required "721 Opinion" regarding tax treatment of the merger consideration will not be satisfied, which is a condition to closing.
  • 5The election deadline for Williams stockholders has been adjusted to be earlier of 20 business days after mailing or 3 business days before closing.
  • 6The filing highlights ongoing SEC review and potential delays in obtaining necessary regulatory approvals and opinions.
  • 7The company emphasizes that the merger agreement remains in full force and effect, subject to the modifications in the amendment.

Frequently Asked Questions

The amendment to the merger agreement with Williams primarily aims to synchronize the mailing of the election form for Williams stockholders with the mailing of the proxy statement/prospectus, simplifying the process and adjusting deadlines.

Yes, two significant potential roadblocks are highlighted: 1) The SEC is still reviewing the proxy statement/prospectus and has requested additional disclosures, delaying its effectiveness. 2) There is a substantial risk that Energy Transfer LP may not be able to obtain a "721 Opinion" which is a condition precedent to closing the merger.

The deadline for receipt of the Form of Election by the exchange agent has been changed to the earlier of (i) 20 business days after the mailing of the Form of Election or (ii) three business days prior to the anticipated closing date of the Merger. Previously, it was 30 days prior to closing.

The "721 Opinion" refers to a tax opinion from Latham & Watkins LLP stating that the contribution of Williams' assets and liabilities to Energy Transfer and the issuance of Class E units should qualify as an exchange under Section 721(a) of the Internal Revenue Code. Obtaining this tax opinion is a condition to closing the merger, and the filing indicates a substantial risk it may not be satisfied.