8-KMaterial AgreementsExhibits & Filings

Energy Transfer LP 8-K Report, Material Agreement (Dec 10, 2021)

Filed December 10, 2021For Securities:ETET-PI

Summary

This 8-K filing from Energy Transfer LP (ET) on December 10, 2021, details a significant secondary offering of common units. CenterPoint Energy Midstream, Inc. sold 100,000,000 common units of ET at a public offering price of $7.65 per unit. Importantly, ET itself did not receive any proceeds from this sale, as it was a sale by a selling unitholder. However, the Partnership and certain affiliated purchasers (officers and directors of the General Partner) did purchase approximately 20.6 million units at a slightly discounted price of $7.4492 per unit, indicating internal confidence in the company's valuation despite the large sale. The filing also includes a standard 60-day lock-up period for the selling unitholder, the Partnership, and certain directors and officers, preventing further disposals of common units without underwriter consent. This offering was conducted under an existing shelf registration statement, and the Underwriting Agreement contains customary representations, warranties, and indemnification provisions. Investors should note that this event primarily represents a change in beneficial ownership rather than a capital raise for Energy Transfer LP.

Key Highlights

  • 1CenterPoint Energy Midstream, Inc. sold 100 million ET common units in a secondary offering.
  • 2The offering price was $7.65 per common unit.
  • 3Energy Transfer LP (the Partnership) did not receive any proceeds from the sale.
  • 4The Partnership and affiliated purchasers bought approximately 20.6 million units at $7.4492 per unit.
  • 5A 60-day lock-up period is in effect for the seller, Partnership, and certain officers/directors regarding their units.
  • 6The sale was conducted under an effective shelf registration statement.

Frequently Asked Questions

No, Energy Transfer LP did not receive any proceeds from this offering. The 100 million common units were sold by CenterPoint Energy Midstream, Inc., a selling unitholder.

The vast majority of the 100 million units were sold to the public through underwriters. However, the Partnership itself and certain affiliated purchasers (officers and directors of the General Partner) bought approximately 20.6 million units.

The purchase of units by the Partnership and its affiliated individuals at a price close to the public offering price can be interpreted as a signal of internal confidence in the company's value and future prospects, even as a large block of shares was being sold by another entity.

There is a 60-day lock-up period following the Underwriting Agreement date (December 7, 2021) during which the selling unitholder, the Partnership, and certain directors and officers are restricted from selling or disposing of their common units without the underwriters' consent, with certain exceptions.