8-KMaterial AgreementsExhibits & Filings

WILLIAMS COMPANIES, INC. 8-K Report, Material Agreement (Nov 22, 2006)

Filed November 22, 2006For Securities:WMB

Summary

This 8-K filing from Williams Companies, Inc. (WMB) on November 21, 2006, details a material definitive agreement related to Williams Partners L.P. (the Partnership). The Partnership entered into a Purchase and Sale Agreement to acquire an additional 74.9% membership interest in Williams Four Corners LLC (Four Corners) from affiliated entities for approximately $1.223 billion. This acquisition follows a prior 25.1% interest acquisition in June 2006. Four Corners holds natural gas gathering, processing, and treating assets in the San Juan Basin. The transaction's consideration will include cash and up to $325 million in newly issued Class B Units of the Partnership, which are subject to unitholder approval for conversion into common units. The agreement includes customary representations, warranties, and indemnification provisions, with specific caps and deductibles. The transaction is expected to close in the fourth quarter of 2006, subject to financing and regulatory approvals.

Key Highlights

  • 1Williams Partners L.P. to acquire an additional 74.9% interest in Williams Four Corners LLC for $1.223 billion.
  • 2Four Corners owns natural gas gathering, processing, and treating assets in the San Juan Basin.
  • 3The acquisition follows a prior 25.1% interest purchase earlier in 2006.
  • 4Consideration includes cash and up to $325 million in Class B Units, which require unitholder approval for conversion.
  • 5The transaction is subject to financing and antitrust clearance (HSR Act).
  • 6Closing is anticipated in the fourth quarter of 2006.
  • 7The agreement includes reciprocal indemnification provisions with specified deductibles and caps.

Frequently Asked Questions

This filing announces a material definitive agreement where Williams Partners L.P. is acquiring a significant additional stake (74.9%) in Williams Four Corners LLC, a company with natural gas midstream assets in the San Juan Basin. This move consolidates ownership of these assets under the Partnership.

The acquisition will be financed through a combination of cash and up to $325 million in newly issued Class B Units of Williams Partners L.P. The issuance of these Class B Units is subject to regulatory approval and potential conversion into common units, which will require unitholder approval.

The closing is contingent upon several factors, including the Partnership's ability to secure necessary financing, obtaining antitrust clearance from the Federal Trade Commission under the Hart-Scott-Rodino Act, and other customary closing conditions. The company expects the closing to occur within the fourth quarter of 2006.

Both buyer and seller parties have agreed to indemnify each other against certain losses. These include liabilities arising from breaches of representations, warranties, or covenants, as well as environmental law violations. The indemnification obligations are subject to an aggregate deductible of $5.0 million and a cap of $150.0 million, with some exceptions for specific liabilities like title to the interest acquired and certain tax liabilities.