Exhibit 1.1
Execution
Version
Energy Transfer Partners, L.P.
$800,000,000 4.65% Senior Notes due 2021
$700,000,000 6.05% Senior Notes due 2041
UNDERWRITING AGREEMENT
May 9, 2011
RBS Securities Inc.
Credit Suisse Securities (USA) LLC
SunTrust Robinson Humphrey, Inc.
BNP Paribas Securities Corp.
Deutsche Bank Securities Inc.,
As Representatives of the Several Underwriters
named in
Schedule I
,
c/o RBS Securities Inc.
600 Washington Blvd.
Stamford, Connecticut 06901
Ladies and Gentlemen:
Energy Transfer Partners, L.P., a Delaware limited partnership (the
Partnership
), agrees
with the several underwriters named in
Schedule I
hereto (the
Underwriters
), for whom RBS
Securities Inc., Credit Suisse Securities (USA) LLC, SunTrust Robinson Humphrey, Inc., BNP Paribas
Securities Corp. and Deutsche Bank Securities Inc. are acting as representatives (the
"
Representatives
), to issue and sell to the Underwriters $800,000,000 aggregate principal amount
of its 4.65% Senior Notes due 2021 (the
Notes due 2021
) and $700,000,000 aggregate principal
amount of its 6.05% Senior Notes due 2041 (the
Notes due 2041
and, together with the Notes due
2021, the
Securities
), to be issued under an indenture, dated as of January 18, 2005, among the
Partnership, the guarantor parties named therein and U.S. Bank National Association (as successor
to Wachovia Bank, National Association), as trustee (the
Trustee
), as supplemented through the
Closing Date (the
Indenture
). Energy Transfer Partners GP, L.P., a Delaware limited partnership
(the
General Partner
), is the general partner of the Partnership. Energy Transfer Partners,
L.L.C., a Delaware limited liability company, is the general partner of the General Partner (
ETP
LLC
). The General Partner, ETP LLC and the Partnership are herein collectively called the
ETP
Entities
. Any reference herein to the Registration Statement, the Base Prospectus, any Preliminary
Prospectus or the Final Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 which were filed under the
Exchange Act on or before the Effective Date of the Registration Statement or the issue date of the
Base Prospectus, any Preliminary Prospectus or the Final Prospectus, as the case may be (the
Incorporated Documents
); and any reference herein to the terms amend,
amendment or
supplement with respect to the Registration Statement, the Base Prospectus,
any Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and include the
filing of any document under the Exchange Act after the Effective Date of the Registration
Statement or the issue date of the Base Prospectus, any Preliminary Prospectus or the Final
Prospectus, as the case may be, deemed to be incorporated therein by reference. Certain terms used
herein are defined in
Section 21
hereof.
1.
Representations and Warranties
. The Partnership represents and warrants to, and
agrees with, each Underwriter as set forth below in this
Section 1
.
(a) The Partnership meets the requirements for use of Form S-3 under the Securities
Act, and has prepared and filed with the Commission an automatic shelf registration
statement, as defined in Rule 405, on Form S-3 (No. 333-171697), including a related Base
Prospectus, for registration under the Securities Act of the offering and sale of the
Securities. Such Registration Statement, including any amendments thereto filed with the
Commission prior to the Execution Time, became effective upon filing with the Commission.
The Partnership may have filed with the Commission, as part of an amendment to the
Registration Statement or pursuant to Rule 424(b), one or more preliminary prospectus
supplements relating to the Securities, each of which has previously been furnished to the
Representatives. The Partnership will file with the Commission a final prospectus
supplement relating to the Securities in accordance with Rule 424(b). As filed, such final
prospectus supplement shall contain all information required by the Securities Act and the
rules thereunder, and, except to the extent the Representatives shall agree in writing to a
modification, shall be in all substantive respects in the form furnished to the
Representatives prior to the Execution Time or, to the extent not completed at the Execution
Time, shall contain only such specific additional information and other changes (beyond that
contained in the Base Prospectus and any Preliminary Prospectus) as the Partnership has
advised the Representatives, prior to the Execution Time, will be included or made therein.
The Registration Statement, at the Execution Time, meets the requirements set forth in Rule
415(a)(1)(x). The initial Effective Date of the Registration Statement was not earlier than
the date three years before the Execution Time.
(b) (i)(A) At the time the Registration Statement initially became effective, (B) at
the time of each amendment thereto for the purposes of complying with Section 10(a)(3) of
the Securities Act (whether by post-effective amendment, incorporated report or form of
prospectus), (C) on the Effective Date relating to the Securities and (D) on the Closing
Date, the Registration Statement conformed and will conform in all material respects to the
applicable requirements of the Securities Act, the Exchange Act and the Trust Indenture Act
and did not and will not include any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make the statements
therein not misleading, and (ii) (A) on its date, (B) at the time of filing the Final
Prospectus pursuant to Rule 424(b) and (C) on the Closing Date, the Final Prospectus
(together with any supplement thereto) will conform in all respects to the requirements of
the Securities Act, the Exchange Act and the Trust Indenture Act, and will not include any
untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the
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light of the
circumstances under which they were made, not misleading;
provided
,
however
, that the Partnership makes no representations or warranties as to the
information contained in or omitted from the Registration Statement or the Final Prospectus
(or any supplement thereto) in reliance upon and in conformity with information furnished in
writing to the Partnership by or on behalf of any Underwriter through the Representatives
specifically for inclusion in the Registration Statement or the Final Prospectus (or any
supplement thereto), it being understood and agreed that the only such information furnished
by or on behalf of any Underwriter consists of the information described as such in
Section 8(b)
hereof.
(c) As of the Applicable Time, neither (i) the Disclosure Package nor (ii) any
individual Limited Use Issuer Free Writing Prospectus, when considered together with the
Disclosure Package, included any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding sentence does not
apply to statements in or omissions from any Statutory Prospectus or any Issuer Free Writing
Prospectus in reliance upon and in conformity with information furnished in writing to the
Partnership by or on behalf of any Underwriter through the Representatives specifically for
inclusion therein, it being understood and agreed that the only such information furnished
by or on behalf of any Underwriter consists of the information described as such in
Section 8(b)
hereof.
(d) At the time of the initial filing of the Registration Statement, including (i) at
the time of the most recent amendment thereto for the purposes of complying with Section
10(a)(3) of the Securities Act (whether such amendment was by post-effective amendment,
incorporated report filed pursuant to Sections 13 or 15(d) of the Exchange Act or form of
prospectus) and (ii) at the Execution Time (with such date being used as the determination
date for purposes of this
clause (ii)
), the Partnership was or is (as the case may
be), a well-known seasoned issuer as defined in Rule 405. The Partnership agrees to pay
the fees required by the Commission relating to the Securities within the time required by
Rule 456(b)(1) without regard to the proviso therein and otherwise in accordance with Rules
456(b) and 457(r).
(e) (i) At the earliest time after the filing of the Registration Statement that the
Partnership or another offering participant made a bona fide offer (within the meaning of
Rule 164(h)(2)) of the Securities and (ii) at the Execution Time (with such date being used
as the determination date for purposes of this
clause (ii)
), the Partnership was not
and is not an ineligible issuer as defined in Rule 405, without taking account of any
determination by the Commission pursuant to Rule 405 that it is not necessary that the
Partnership be considered an ineligible issuer.
(f) The Partnership has not received from the Commission any notice pursuant to Rule
401(g)(2) objecting to use of the automatic shelf registration statement form. If at any
time when the Securities remain unsold by the Underwriters the Partnership receives from the
Commission a notice pursuant to Rule 401(g)(2) or otherwise ceases to be eligible to use the
automatic shelf registration statement form, the Partnership will (i) promptly notify the
Representatives, (ii) promptly file
a new
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registration statement or post-effective amendment
on the proper form relating to the
Securities, in a form satisfactory to the Representatives, (iii) use its best efforts
to cause such registration statement or post-effective amendment to be declared effective as
soon as practicable, and (iv) promptly notify the Representatives of such effectiveness.
The Partnership will take all other action necessary or appropriate to permit the public
offering and sale of the Securities to continue as contemplated in the registration
statement that was the subject of the Rule 401(g)(2) notice or for which the Partnership has
otherwise become ineligible. References herein to the Registration Statement shall include
such new registration statement or post-effective amendment, as the case may be.
(g) Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent
times through the completion of the public offer and sale of the Securities or until any
earlier date that the Partnership notified or notifies the Representatives as described in
the last sentence of this
Section 1(g)
, did not, does not and will not include any
information that conflicted, conflicts or will conflict with the information then contained
in the Registration Statement, including any document incorporated therein by reference and
any prospectus supplement deemed to be a part thereof that has not been superseded or
modified. The foregoing sentence does not apply to statements in or omissions from any
Issuer Free Writing Prospectus in reliance upon and in conformity with information furnished
in writing to the Partnership by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein, it being understood and agreed that the only such
information furnished by or on behalf of any Underwriter consists of the information
described as such in
Section 8(b)
hereof. If at any time following issuance of an
Issuer Free Writing Prospectus there occurred or occurs an event or development as a result
of which such Issuer Free Writing Prospectus conflicted or would conflict with the
information then contained in the Registration Statement or as a result of which such Issuer
Free Writing Prospectus, if republished immediately following such event or development,
would include an untrue statement of a material fact or omitted or would omit to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, (i) the Partnership has promptly
notified or will promptly notify the Representatives and (ii) the Partnership has promptly
amended or will promptly amend or supplement such Issuer Free Writing Prospectus to
eliminate or correct such conflict, untrue statement or omission.
(h) All of the issued and outstanding general partner interests, incentive distribution
rights and limited partner interests of the Partnership have been duly authorized and
validly issued and are fully paid (to the extent required under the Second Amended and
Restated Agreement of Limited Partnership of the Partnership (the
Partnership Agreement
))
and non-assessable (except as such non-assessability may be affected by (i) matters
described in the Registration Statement, the Disclosure Package and the Final Prospectus and
(ii) Sections 17-303(a), 17-607 or 17-804 of the Delaware Revised Uniform Limited
Partnership Act (the
Delaware LP Act
)), have been issued in compliance with all applicable
securities laws and were not issued in violation of any preemptive right, resale right,
right of first refusal or similar right; and no further approval or authority of the
security holders or the Board of Directors of ETP LLC is required for the offering and sale
of the Securities; the Certificate of Limited Partnership
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of the Partnership and the
Partnership Agreement, each as filed with the Incorporated
Documents, have been duly authorized and approved in accordance with the Delaware LP
Act and are in full force and effect.
(i) Each of the ETP Entities and each of the subsidiaries listed in
Schedule IV
hereto (collectively, referred to herein as the
Subsidiaries
) has been duly formed and is
validly existing in good standing as a limited partnership or limited liability company, as
the case may be, under the laws of the State of Delaware, with all partnership or limited
liability company power and authority necessary, in the case of the Partnership, to own,
lease and operate its properties and conduct its business as described in the Registration
Statement, the Disclosure Package and the Final Prospectus and, in the case of the General
Partner and ETP LLC, to act as general partner of the Partnership and the General Partner,
respectively, in each case in all material respects as described in the Registration
Statement, the Disclosure Package and the Final Prospectus.
(j) Each of the ETP Entities and each of the Subsidiaries is duly registered or
qualified to do business as a foreign limited liability company or limited partnership, as
the case may be, and is in good standing in each jurisdiction where the ownership or leasing
of its properties or the conduct of its business requires such registration or
qualification, except where the failure to be so registered or qualified and in good
standing would not, individually or in the aggregate, (i) have a material adverse effect on
the business, properties, financial condition, results of operations or prospects of the
Partnership and the Subsidiaries, taken as a whole or (ii) prevent or materially interfere
with the consummation of the transactions contemplated by this Agreement and the Indenture,
including the offering, issuance and sale of the Securities (the occurrence of any such
effect or any such prevention or interference or any such result described in the foregoing
clauses (i)
, and
(ii)
being herein referred to as a
Material Adverse
Effect
); insofar as the foregoing representation relates to the registration or
qualification of the ETP Entities, the applicable jurisdictions are set forth on
Schedule III
hereto.
(k) The General Partner is the sole general partner of the Partnership with an
approximate 1.6% general partner interest in the Partnership (the
GP Interest
) existing
immediately prior to the time of purchase of the Securities under this Agreement; such GP
Interest has been duly authorized and validly issued in accordance with the Partnership
Agreement, and the General Partner owns such general partner interest free and clear of all
liens, claims, charges and encumbrances (
Liens
).
(l) The limited partners of the Partnership own 208,470,929 common units representing
limited partner interests in the Partnership (
Units
) and 8,853,832 Class E Units (the
Existing Units
), representing an approximate 98.2% limited partner interest in the
Partnership, 50,226,967 Units of which are owned by Energy Transfer Equity, L.P., a Delaware
limited partnership (
ETE
), free and clear of all Liens, other than Liens arising under the
Credit Agreement, dated as of September 20, 2010, among ETE, Credit Suisse AG (as
administrative agent) and the other lenders party thereto and the Pledge and Security
Agreement, dated as of September 20, 2010, by and among ETE, ETP LLC, ETE GP Acquirer LLC,
ETE Services Company, LLC and Regency GP LLC (as the
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grantors) and Credit Suisse AG, Cayman
Islands Branch (as collateral agent) (collectively, the
ETE Credit Agreement
).
(m) All of the Existing Units and the limited partner interests represented thereby
have been duly authorized and validly issued in accordance with the Partnership Agreement,
and have been fully paid (to the extent required under the Partnership Agreement) and
non-assessable (except as such non-assessability may be affected by (i) matters described in
the Registration Statement, the Disclosure Package and the Final Prospectus and (ii)
Sections 17-303(a), 17-607 or 17-804 of the Delaware LP Act).
(n) ETE owns 100% of the issued and outstanding membership interests in ETP LLC; such
membership interests have been duly authorized and validly issued in accordance with the ETP
LLC limited liability company agreement and are fully paid (to the extent required under the
ETP LLC limited liability company agreement) and non-assessable (except as such
non-assessability may be affected by matters described in Section 18-607 of the Delaware
Limited Liability Company Act (the
Delaware LLC Act
)); and ETE owns such membership
interests free and clear of all Liens, other than Liens under the ETE Credit Agreement.
(o) (i) ETP LLC is the sole general partner of the General Partner, with a 0.01%
general partner interest in the General Partner; (ii) such interest has been duly authorized
and validly issued in accordance with the General Partners agreement of limited
partnership; (iii) ETP LLC owns such general partner interest free and clear of all Liens;
(iv) ETE owns 100% of the Class A limited partner interests of the General Partner and 100%
of the Class B limited partner interests of the General Partner; (v) such limited partner
interests have been duly authorized and validly issued in accordance with the General
Partners agreement of limited partnership and are fully paid (to the extent required under
the General Partners agreement of limited partnership) and non-assessable (except as such
non-assessability may be affected by Sections 17-303(a), 17-607 or 17-804 of the Delaware LP
Act and as otherwise described in the Registration Statement, the Disclosure Package and the
Final Prospectus; and (vi) ETE owns such limited partner interests free and clear of all
Liens, other than Liens arising under the ETE Credit Agreement.
(p) The Partnership has no direct or indirect subsidiaries (as defined under the
Securities Act) other than the Subsidiaries; other than the Subsidiaries, the Partnership
does not own, directly or indirectly, any shares of stock or any other equity interests or
long-term debt securities of any corporation, firm, partnership, joint venture, association
or other entity; complete and correct copies of the formation and governing documents of
each of the ETP Entities and all amendments thereto have been delivered to the
Representatives, and, no changes thereto will be made on or after the date hereof, through
and including the time of purchase, or, if later, any additional time of purchase; and each
of the ETP Entities is in compliance with the laws, orders, rules, regulations and
directives issued or administered by such jurisdictions, except where the failure to be in
compliance would not, individually or in the aggregate, have a Material Adverse Effect.
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(q) The Securities conform in all material respects to each description thereof, if
any, contained or incorporated by reference in the Registration Statement, the Disclosure
Package and the Final Prospectus.
(r) This Agreement has been duly authorized and executed and validly delivered by the
Partnership.
(s) The Partnership has all requisite limited partnership power and authority to issue
and deliver the Securities in accordance with and upon the terms and conditions set forth in
this Agreement and the Indenture, and to execute, deliver and perform its obligations under
this Agreement, the Indenture and the Securities.
(t) The execution and delivery of, and the performance by the Partnership of its
obligations under, the Indenture have been duly and validly authorized by the Partnership,
and the Indenture, assuming due authorization, execution and delivery thereof by the
Trustee, when executed and delivered by the Partnership, will have been duly executed and
delivered by the Partnership, and will constitute the valid and legally binding obligations
of the Partnership, enforceable against the Partnership in accordance with its terms;
provided that the enforceability thereof may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws relating to or affecting
creditors rights generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law). The Indenture has been
duly qualified under the Trust Indenture Act. The Securities have been duly authorized for
issuance and sale to the Underwriters, and, when executed by the Partnership and
authenticated by the Trustee in accordance with the provisions of the Indenture and
delivered to and paid for by the Underwriters, will have been duly executed and delivered by
the Partnership, and will constitute the valid and legally binding obligations of the
Partnership, entitled to the benefits of the Indenture; provided that the enforceability
thereof may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws relating to or affecting creditors rights generally and by
general principles of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(u) None of the ETP Entities or any Subsidiary is (A) in violation of its respective
formation, governing or any other organizational documents, or (B) in breach of, in default
under or in violation of, nor has any event occurred which with notice, lapse of time or
both would result in any breach of, default under or violation of or give the holder of any
indebtedness (or a person acting on such holders behalf) the right to require the
repurchase, redemption or repayment of all or any part of such indebtedness under any
indenture, mortgage, deed of trust, note agreement, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other agreement or instrument
to which any of the ETP Entities or any Subsidiary is a party or by which it or its
properties may be bound or affected, or (C) in violation of any federal, state, local or
foreign law, statute, regulation or rule, or (D) in violation of any rule or regulation of
any self-regulatory organization or other non-governmental regulatory authority (including,
without limitation, the rules and regulations of the New York Stock Exchange (the
NYSE
)),
or (E) in violation of any decree, judgment or order applicable
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to any of the ETP Entities
or any Subsidiary or any of their respective properties, except any such breach, default or
violation, in the case of
clauses (B)
,
(C)
,
(D)
and
(E)
above, that would, if continued, not have, individually or in the aggregate, a Material
Adverse Effect or would not materially impair the ability of the Partnership to perform its
obligations under this Agreement or the transactions contemplated by the Purchase
Agreement; and none of (i) the offering, issuance and sale by the Partnership of the
Securities, (ii) the execution, delivery and performance of this Agreement, the Indenture
and the Securities by the Partnership, or (iii) the consummation of the transactions
contemplated hereby and thereby or the fulfillment of the terms hereof or thereof will
conflict with, result in any breach or violation of or constitute a default under, nor
constitute any event which with notice, lapse of time or both would result in any breach or
violation of or constitute a default under or give the holder of any indebtedness (or a
person acting on such holders behalf) the right to require the repurchase, redemption or
repayment of all or a part of such indebtedness under, or result in the creation or
imposition of a Lien on any property or assets of any of the ETP Entities or any Subsidiary
pursuant to (I) any formation, governing or any other organizational document of any of the
ETP Entities, or (II) any indenture, mortgage, deed of trust, note agreement, bank loan or
credit agreement or other evidence of indebtedness, or any license, lease, contract or other
agreement or instrument to which any of the ETP Entities or any Subsidiary is a party or by
which any of them or any of their respective properties may be bound or affected, or (III)
any federal, state, local or foreign law, regulation or rule, or (IV) any rule or regulation
of any self-regulatory organization or other non-governmental regulatory authority
(including, without limitation, the rules and regulations of the NYSE), or (V) any decree,
judgment or order applicable to any of the ETP Entities or any Subsidiary or any of their
respective properties, except for any such conflicts, breaches, violations or defaults, in
the case of
clauses (II)
,
(III)
,
(IV)
, and
(V)
above, that
would not have, individually or in the aggregate, a Material Adverse Effect.
(v) No approval, authorization, consent or order of or filing with any federal, state,
local or foreign governmental or regulatory commission, board, body, authority or agency, or
of or with any self-regulatory organization or other non-governmental regulatory authority
having jurisdiction over any ETP Entity or their property (including, without limitation,
the NYSE) (each, a
Consent
) is required in connection with (i) the offering, issuance or
sale of the Securities in the manner contemplated herein and in the Disclosure Package, (ii)
the execution, delivery and performance of this Agreement, the Indenture and the Securities
by the Partnership, and (iii) the consummation by the Partnership of the transactions
contemplated hereby and thereby other than (I) registration of the Securities under the
Securities Act, which has been effected (or, with respect to any registration statement to
be filed hereunder pursuant to Rule 462(b), will be effected in accordance herewith), (II)
any necessary qualification under the securities or blue sky laws of the various
jurisdictions in which the Securities are being offered by the Underwriters, (III) such
Consents that have been obtained prior to the date hereof and (IV) such Consents which, if
not obtained, would not, individually or in the aggregate, have a Material Adverse Effect.
(w) The Partnership and each of the Subsidiaries have all necessary licenses,
authorizations, consents and approvals (each, a
Permit
) and have made all necessary
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filings required under any applicable law, regulation or rule, and have obtained all
necessary Permits from other persons, in order to conduct their businesses, except for such
permits that, if not obtained, would not have a Material Adverse Effect; none of the
Partnership or any of the Subsidiaries is in violation of, is in default under, and has
received notice of any proceedings relating to revocation or modification of, any such
Permit or any federal, state, local or foreign law, regulation or rule or any decree, order
or judgment applicable to any of the ETP Entities or any Subsidiary, except as set forth in
the Disclosure Package and except where such violation, default, revocation or modification
would not, individually or in the aggregate, have a Material Adverse Effect.
(x) All legal or governmental proceedings, affiliate transactions, off-balance sheet
transactions (including, without limitation, transactions related to, and the existence of,
variable interest entities within the meaning of Financial Accounting Standards Board
Interpretation No. 46), contracts, licenses, agreements, properties, leases or documents of
a character required to be described in the Registration Statement, the Disclosure Package
and the Final Prospectus or to be filed as an exhibit to the Registration Statement have
been so described or filed as required; and the statements included in the Registration
Statement, the Disclosure Package and the Final Prospectus (i) under the headings
Description of Other Indebtedness, Description of Notes, Material Income Tax
Considerations and Certain United States Federal Income Tax Considerations, and (ii) in
the Partnerships Annual Report on Form 10-K for the year ended December 31, 2010 under the
captions Business Natural Gas Operations Segments Regulation and Legal
Proceedings, in each case, (i) as such matters have been updated by any subsequent
Quarterly Report on Form 10-Q or Current Report on Form 8-K filed by the Partnership with
the Commission and (ii) including any similar information, if any, contained in any Issuer
Free Writing Prospectus, insofar as such statements summarize legal matters, agreements,
documents or proceedings discussed therein, are accurate and fair summaries of such legal
matters, agreements, documents or proceedings.
(y) Except as described in the Registration Statement, the Disclosure Package and the
Final Prospectus, there are no actions, suits, claims, investigations or proceedings pending
or, to the knowledge of the Partnership after due inquiry, threatened or contemplated to
which any of the ETP Entities, any Subsidiary or any of ETP LLCs directors or officers is
or would be a party or of which any of their respective properties is or would be subject at
law or in equity, before or by any federal, state, local or foreign governmental or
regulatory commission, court, board, body, authority or agency, or before or by any
self-regulatory organization or other non-governmental regulatory authority (including,
without limitation, the rules and regulations of the NYSE), except for any such action,
suit, claim, investigation or proceeding which, if resolved adversely to any ETP Entity or
any Subsidiary, would not, individually or in the aggregate, have a Material Adverse Effect.
(z) Grant Thornton LLP, who has audited the consolidated financial statements of the
Partnership as of and for the years ended December 31, 2010, 2009 and 2008 are independent
registered public accountants as required by the Securities Act and
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by the rules of the
Public Company Accounting Oversight Board (United States) (the
PCAOB
).
(aa) At March 31, 2011, the Partnership had on an actual basis, and would have had,
after giving effect to the offering of the Securities on the pro forma basis indicated in
the Disclosure Package, a capitalization as set forth therein. The financial statements
included or incorporated by reference in the Registration Statement, the Disclosure Package
and the Final Prospectus, together with the related notes and schedules, present fairly in
all material respects the consolidated financial position of the Partnership and the
Subsidiaries as of the dates indicated and the consolidated results of operations, cash
flows and changes in partners equity of the Partnership and the Subsidiaries for the
periods specified and have been prepared in compliance with the requirements of the
Securities Act and the Exchange Act and in conformity with U.S. generally accepted
accounting principles applied on a consistent basis (
GAAP
) during the periods involved,
except to the extent expressly disclosed therein; the other financial and statistical data
set forth in or incorporated by reference into the Registration Statement, the Disclosure
Package and the Final Prospectus are accurately and fairly presented and prepared on a basis
consistent with the financial statements and books and records of the Partnership. No other
financial statements are required to be included in the Registration Statement, the
Disclosure Package and the Final Prospectus, pursuant to the applicable accounting
requirements of the Securities Act and the Exchange Act.
(bb) Subsequent to the respective dates as of which information is given in the
Registration Statement, the Disclosure Package and the Final Prospectus, in each case
excluding any amendments or supplements to the foregoing made after the execution of this
Agreement, there has not been (i) any material adverse change, or any development involving,
singly or in the aggregate, a prospective material adverse change, in the business,
properties, management, financial condition, prospects, net worth or results of operations
of the ETP Entities individually or in the aggregate, on the one hand, and/or the
Partnership and the Subsidiaries (taken as a whole), on the other hand, (ii) any transaction
that is material to the Partnership or any Subsidiary (taken as a whole), (iii) any
obligation or liability, direct, indirect or contingent (including any off-balance sheet
obligations), incurred by any of the ETP Entities or any of the Subsidiaries that is
material to the Partnership and the Subsidiaries (taken as a whole), (iv) any material
change in the capitalization, ownership or outstanding indebtedness of any of the ETP
Entities or (v) any dividend or distribution of any kind declared, paid or made on the
securities of the Partnership or any Subsidiary, in each case whether or not arising from
transactions in the ordinary course of business.
(cc) Neither the Partnership nor any Subsidiary is, and at no time during which a
prospectus is required by the Act to be delivered (whether physically or through compliance
with Rule 172 under the Act or any similar rule) in connection with any sale of Securities
will any of them be, and, after giving effect to the offering and sale of the Securities,
none of them will be, an investment company or an entity controlled by an investment
company, as such terms are defined in the Investment Company Act of 1940, as amended.
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(dd) The Partnership and each of the Subsidiaries have good and marketable title to all
real property and good title to all personal property described in the Registration
Statement, the Disclosure Package and the Final Prospectus, as being owned by it, free and
clear of all Liens except (i) as described in the Registration Statement, the Disclosure
Package and the Final Prospectus, (ii) as provided in the Security Agreement
dated June 28, 1996, among Heritage Holdings, Inc., Heritage Operating, L.P., a
Delaware limited partnership, and Wilmington Trust Company, and (iii) as do not materially
interfere with the use of such properties, taken as a whole, as described in the
Registration Statement, the Disclosure Package and the Final Prospectus, including Liens
pursuant to mortgage and/or security agreements given as security for certain non-compete
agreements with the prior owners of certain businesses previously acquired by the
Partnership and the Subsidiaries; provided, that, with respect to title to pipeline
rights-of-way, the Partnership represents only that (A) each applicable Subsidiary has
sufficient title to enable it to use and occupy the pipeline rights-of-way as they have been
used and occupied in the past and are to be used and occupied in the future as described in
the Registration Statement, the Disclosure Package and the Final Prospectus and (B) any lack
of title to the pipeline rights-of-way will not have a Material Adverse Effect. All of the
real property and buildings held under lease by the Partnership and each Subsidiary are held
under valid and subsisting and enforceable leases, with such exceptions as would not
materially interfere with the use of such properties, taken as a whole, as described in the
Registration Statement, the Disclosure Package and the Final Prospectus.
(ee) The Partnership and each of the Subsidiaries own or possess adequate rights to use
all material patents, patent applications, trademarks, service marks, trade names, trademark
registrations, service mark registrations, copyrights, licenses and know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures) necessary for the conduct of their respective
businesses; and the conduct of their respective businesses will not conflict in any material
sense with, and neither the Partnership nor any Subsidiary has received any notice of
conflict with, any such rights of others.
(ff) No labor disputes with the employees that are engaged in the businesses of the
Partnership and the Subsidiaries exist or, to the knowledge of the Partnership, are imminent
or threatened except for those that would not, individually or in the aggregate, have a
Material Adverse Effect. To the Partnerships knowledge after due inquiry, there has been
no violation of any federal, state, local or foreign law relating to discrimination in the
hiring, promotion or pay of employees, any applicable wage or hour laws or any provision of
the Employee Retirement Income Security Act of 1974 or the rules and regulations promulgated
thereunder concerning the employees providing services to the Partnership or any Subsidiary.
(gg) Except as described in the Registration Statement, the Disclosure Package and the
Final Prospectus, the Partnership and the Subsidiaries (i) are in compliance with any and
all applicable laws and regulations relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants or contaminants
(
Environmental Laws
), (ii) have received and are in compliance with all permits, licenses
or other approvals required of them under
applicable Environmental
-11-
Laws to conduct their
respective businesses as they are currently being conducted and (iii) have not received
written notice of any, and to the knowledge of the Partnership after due inquiry there are
no, pending events or circumstances that could reasonably be expected to form the basis for
any actual or potential liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or wastes,
pollutants or contaminants, and (iv) are not subject to any pending or, to the
knowledge of the Partnership after due inquiry, threatened actions, suits, demands, orders
or proceedings relating to any Environmental Laws against the ETP Entities (collectively,
Proceedings
), except where such non-compliance with Environmental Laws, failure to receive
required permits, licenses or other approvals, actual or potential liability or Proceedings
could not, individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect. Except as set forth in the Registration Statement, the Disclosure Package
and the Final Prospectus and except for the Newmark Groundwater Contamination Superfund site
(as to which an affiliate of the Partnership received a request for information under
Section 104(2) of the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended (
CERCLA
) in May 2001), none of the ETP Entities nor any of the
Subsidiaries is currently named as a potentially responsible party under CERCLA.
(hh) All tax returns required to be filed by the Partnership and the Subsidiaries
through the date hereof have been timely filed (or extensions have been timely obtained with
respect to such tax returns), and all taxes and other assessments of a similar nature
(whether imposed directly or through withholding) including any interest, additions to tax
or penalties applicable thereto due or claimed to be due from such entities have been timely
paid, other than those being contested in good faith and for which adequate reserves have
been provided.
(ii) The Partnership and each of the Subsidiaries maintain insurance covering their
properties, operations, personnel and businesses as they reasonably deem adequate; such
insurance insures against such losses and risks to an extent that is adequate in accordance
with customary industry practice to protect the Partnership and each of the Subsidiaries and
their business; all such insurance is fully in force on the date hereof and will be fully in
force on the Closing Date (except with respect to those insurance policies for which the
failure to be in effect would not have, individually or in the aggregate, a Material Adverse
Effect); the Partnership does not have reason to believe that it or any Subsidiary will not
be able to renew any such insurance as and when such insurance expires.
(jj) None of the Partnership nor any Subsidiary has sustained since the date of the
last audited financial statements included in the Registration Statement, the Disclosure
Package and the Final Prospectus, any material loss or interference with its respective
business from fire, explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or decree.
(kk) Except as described in the Registration Statement, the Disclosure Package and the
Final Prospectus, none of the ETP Entities or any of the Subsidiaries has sent or received
any communication regarding termination of, or intent not to renew, any of the
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contracts or
agreements filed as an exhibit to the Registration Statement, the Base Prospectus, the
Preliminary Prospectus, the Final Prospectus or the Issuer Free Writing Prospectuses, if
any, and no such termination or non-renewal has been threatened by any of the ETP Entities
or any Subsidiary. To the knowledge of the Partnership after due inquiry, no third party to
any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition, covenant or
instrument to which any of the ETP Entities or any of the Subsidiaries is a party or bound
or to which their respective properties are subject, is in breach, default or violation
under any such agreement (and no event has occurred that, with notice or lapse of time or
both, would constitute such an event), except for any such breach, default or violation that
would not, individually or in the aggregate, have a Material Adverse Effect.
(ll) The Partnership maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance with
managements general or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to maintain
accountability for assets; (iii) access to assets is permitted only in accordance with
managements general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(mm) The Partnership has established and maintains and evaluates disclosure controls
and procedures (as such term is defined in Rules 13a-15 and 15d-15 under the Exchange Act)
and internal control over financial reporting (as such term is defined in Rules 13a-15 and
15d-15 under the Exchange Act); such disclosure controls and procedures are designed to
ensure that material information relating to the Partnership (including the Subsidiaries) is
made known to the Chief Executive Officer and the Chief Financial Officer of ETP LLC, and
such disclosure controls and procedures are effective to perform the functions for which
they were established; the Partnerships auditors and the Audit Committee of the Board of
Directors of ETP LLC have been advised of: (i) all significant deficiencies, if any, in the
design or operation of the Partnerships internal controls over financial reporting that
could adversely affect the Partnerships ability to record, process, summarize and report
financial data, (ii) all fraud, if any, whether or not material, that involves management or
other employees who have a role in the Partnerships internal controls over financial
reporting, and (iii) all material weaknesses, if any, in the Partnerships internal controls
over financial reporting that have been identified for the Partnerships auditors; since the
date of the most recent evaluation of such disclosure controls and procedures and internal
controls over financial reporting, there have been no significant changes in the
Partnerships internal controls over financial reporting or in other factors that could
significantly affect the Partnerships internal controls over financial reporting, including
any corrective actions with regard to significant deficiencies and material weaknesses; the
principal executive officers (or their equivalents) and principal financial officers (or
their equivalents) of the Partnership have made all certifications required by the
Sarbanes-Oxley Act of 2002 (the
Sarbanes-Oxley Act
) and any related rules and regulations
promulgated by the Commission, and the statements contained in any such certification are
complete and correct; and the Partnership, the Subsidiaries and the directors and officers
of ETP LLC, in their capacity
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as such, are each in compliance in all material respects with
all applicable effective provisions of the Sarbanes-Oxley Act and the rules and regulations
of the Commission and the NYSE promulgated thereunder; and the Partnership has taken all
necessary actions to ensure that, upon and at all times after effectiveness of the
Registration Statement, the Partnership, the Subsidiaries and the officers and directors of
ETP LLC, in their capacities as such, will be in compliance in all material respects with the
provisions of the Sarbanes-Oxley Act and the rules and regulations promulgated thereunder.
(nn) All statistical or market-related data included or incorporated by reference in
the Registration Statement, the Disclosure Package and the Final Prospectus are based on or
derived from sources that the Partnership believes to be reliable and accurate in all
material respects, and the Partnership has obtained the written consent to the use of such
data from such sources to the extent required.
(oo) Neither the Partnership nor any Subsidiary is currently prohibited, directly or
indirectly, from repaying to the Partnership any loans or advances to such Subsidiary from
the Partnership or from transferring any of such Subsidiarys property or assets to the
Partnership or any other Subsidiary of the Partnership, except in each case as described in
(i) the Registration Statement, the Disclosure Package and the Final Prospectus or (ii) the
organizational documents of the Partnership and the Subsidiaries.
(pp) Except pursuant to this Agreement, none of the ETP Entities or the Subsidiaries
has incurred any liability for any finders or brokers fees or agents commissions in
connection with the execution and delivery of this Agreement or the consummation of the
transactions contemplated by this Agreement.
(qq) None of the ETP Entities nor any of their respective Affiliates (as such term in
defined in Rule 405) has taken, directly or indirectly, any action designed, or that has
constituted or could reasonably be expected to cause or result in, under the Exchange Act or
otherwise, the stabilization or manipulation of the price of any security of the Partnership
to facilitate the sale or resale of the Securities.
(rr) The operations of the ETP Entities and the Subsidiaries are and have been
conducted at all times in compliance with applicable financial recordkeeping and reporting
requirements and the money laundering statutes and rules and regulations thereunder and any
related or similar rules, regulations or guidelines issued, administered or enforced by any
governmental agency (collectively, the
Money Laundering Laws
), and no action, suit or
proceeding by or before any court or governmental agency, authority or body or any
arbitrator involving any of the ETP Entities or any of the Subsidiaries with respect to the
Money Laundering Laws is pending or, to the best knowledge of the Partnership, threatened.
(ss) None of the ETP Entities or any Subsidiary nor, to the knowledge of the
Partnership, any director, officer, agent, employee or affiliate of any of the ETP Entities
or any Subsidiary is aware of or has taken any action, directly or indirectly, that would
result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as
amended, and the rules and regulations thereunder (the
FCPA
), including, without
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limitation, making use of the mails or any means or instrumentality of interstate commerce
corruptly in furtherance of an offer, payment, promise to pay or authorization of the
payment of any money, or other property, gift, promise to give, or authorization of the
giving of anything of value to any foreign official (as such term is defined in the FCPA)
or any foreign political party or official thereof or any candidate for foreign
political office, in contravention of the FCPA; and the ETP Entities, the Subsidiaries
and, to the knowledge of the Partnership, their affiliates have instituted and maintain
policies and procedures designed to ensure, and which are reasonably expected to continue to
ensure, continued compliance therewith.
(tt) None of the ETP Entities or any Subsidiary, nor to the knowledge of the
Partnership, any director, officer, agent, employee or affiliate of any ETP Entity or any
Subsidiary, is currently subject to any sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department (
OFAC
); and the Partnership will not
directly or indirectly use the proceeds of the sale of the Securities, or lend, contribute
or otherwise make available such proceeds to any subsidiary, joint venture partner or other
person or entity, for the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC.
Any certificate signed by any officer of ETP LLC and delivered to the Representatives or
counsel for the Underwriters in connection with the offering of the Securities shall be deemed a
representation and warranty by the Partnership, as to matters covered thereby, to each Underwriter.
2.
Purchase and Sale
. Subject to the terms and conditions and in reliance upon the
representations, warranties and agreements herein set forth, the Partnership agrees to sell to the
several Underwriters, and each Underwriter agrees, severally and not jointly, to purchase from the
Partnership the respective principal amount of the Securities set forth opposite such Underwriters
name in
Schedule I
hereto at a purchase price of 99.029% of the principal amount of the
Notes due 2021 and of 98.872% of the principal amount of the Notes due 2041, in each case plus
accrued, if any, from May 12, 2011 to the Closing Date (the
Purchase Price
).
3.
Delivery and Payment
. The Partnership will deliver the Securities to or as
instructed by the Representatives for the respective accounts of the several Underwriters in a form
reasonably acceptable to the Representatives against payment of the Purchase Price by the
Underwriters by wire transfer payable in same day funds to an account specified by the Partnership,
and delivery of the Securities shall be made through the facilities of The Depository Trust Company
(the
DTC
) unless the Representatives shall otherwise instruct. Such delivery and payment for the
Securities shall be made at the offices of Andrews Kurth LLP, 600 Travis, Suite 4200, Houston,
Texas at 9:00 a.m., Houston time, on the third full Business Day following the date of this
Agreement, or at such other time not later than seven full Business Days thereafter as the
Representatives and the Partnership determine (such date and time of delivery and payment for the
Securities being herein called the
Closing Date
). For purposes of Rule 15c6-1 under the Exchange
Act, the Closing Date (if later than the otherwise applicable settlement date) shall be the
settlement date for payment of funds and delivery of securities for all the Securities sold
pursuant to the offering. The Securities will be evidenced by one or more global securities in
definitive form (the
Global Notes
) or by additional definitive securities,
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and will be
registered, in the case of the Global Notes, in the name of Cede & Co., as nominee of the DTC, and
in the other cases, in such names and in such denominations as the Underwriters shall request prior
to 9:00 a.m., Houston time, on the second Business Day preceding the Closing Date. The Notes to be
delivered to the Underwriters shall be made available to the Underwriters
at the above offices of Andrews Kurth LLP for inspection not later than 11:00 a.m., Houston
time, on the Business Day immediately preceding the Closing Date.
4.
Offering by Underwriters
. It is understood that the several Underwriters propose
to offer the Securities for sale to the public as set forth in the Disclosure Package and the Final
Prospectus.
5.
Agreements
. The Partnership agrees with the several Underwriters that:
(a) The Partnership has filed or will file each Statutory Prospectus (including the
Final Prospectus), properly completed, and any supplement thereto to be filed in a form
approved by the Representatives with the Commission pursuant to the applicable paragraph of
Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Partnership has complied and will comply with
Rule 433.
(b) Until the completion of the public offer and sale of the Securities contemplated
hereby, the Partnership will promptly advise the Representatives of any proposal to amend or
supplement the Registration Statement or any Statutory Prospectus at any time and will offer
the Representatives a reasonable opportunity to comment on any such amendment or supplement;
and the Partnership will also advise the Representatives promptly of (i) the filing of any
such amendment or supplement, (ii) any request by the Commission or its staff for any
amendment of the Registration Statement, any supplement to any Statutory Prospectus or any
additional information, (iii) the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or of any notice objecting to its use or the
institution or threatening of any proceeding for that purpose and (iv) the receipt by the
Partnership of any notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the institution or threatening of any proceeding
for such purpose. The Partnership will use its best efforts to prevent the issuance of any
such stop order or the occurrence of any such suspension or objection to the use of the
Registration Statement and, upon such issuance, occurrence or notice of objection, to obtain
as soon as possible the withdrawal of such stop order or relief from such suspension or
objection, including, if necessary, by filing an amendment to the Registration Statement or
a new registration statement and using its best efforts to have such amendment or new
registration statement declared effective as soon as practicable.
(c) If, at any time prior to the filing of the Final Prospectus pursuant to Rule
424(b), any event occurs as a result of which the Disclosure Package would include any
untrue statement of a material fact or omit to state any material fact necessary to make the
statements therein in the light of the circumstances under which they were made or the
circumstances then prevailing, not misleading, the Partnership will (i) notify promptly the
Representatives so that any use of the Disclosure Package may cease until it is amended
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or
supplemented; (ii) amended
or supplement the Disclosure Package to correct such statement or
omission; and (iii) supply any amendment or supplement to the several Underwriters in such
quantities as they may reasonably request.
(d) If, at any time when a prospectus relating to the Securities is required to be
delivered under the Securities Act (including in circumstances where such requirement may be
satisfied pursuant to Rule 172), any event occurs as a result of which the Final Prospectus
as then amended or supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein, in the light of
the circumstances under which they were made at such time not misleading, or if it shall be
necessary to amend the Registration Statement, file a new registration statement or
supplement the Final Prospectus to comply with the Securities Act or the Exchange Act,
including in connection with use or delivery of the Final Prospectus, the Partnership
promptly will (i) notify the Representatives of any such event, (ii) prepare and file with
the Commission, subject to the first sentence of
paragraph (a)
of this
Section
5
, and furnish, at its own expense, to the Underwriters and the dealers and any other
dealers upon request of the Representatives, in such amounts as the Representatives or
dealers may reasonably request, an amendment or supplement or new registration statement
which will correct such statement or omission or effect such compliance and (iii) use its
best efforts to have any amendment to the Registration Statement or new registration
statement declared effective as soon as practicable in order to avoid any disruption in use
of the Final Prospectus. Neither the Representatives consent to, nor the Underwriters
delivery of, any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in
Section 6
hereof.
(e) As soon as practicable, but not later than 16 months after the date of this
Agreement, the Partnership will make generally available to its security holders and to the
Representatives an earnings statement or statements of the Partnership and the Subsidiaries
that will satisfy the provisions of Section 11(a) of the Securities Act and Rule 158.
(f) The Partnership will furnish to the Representatives and counsel for the
Underwriters, without charge, signed copies of the Registration Statement (including
exhibits thereto) and to each other Underwriter a copy of the Registration Statement
(without exhibits thereto) and, so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Securities Act (including in circumstances where such
requirement may be satisfied pursuant to Rule 172), as many copies of each Preliminary
Prospectus, the Final Prospectus and each Issuer Free Writing Prospectus and any supplement
thereto as the Representatives may reasonably request. The Partnership will pay the
expenses of printing and distributing to the Underwriters all documents.
(g) The Partnership will arrange, if necessary, for the qualification of the Securities
for sale under the laws of such jurisdictions as the Representatives may designate and will
maintain such qualifications in effect so long as required for the distribution of the
Securities; provided that in no event shall the Partnership be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
-17-
action that
would subject it to service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not now so subject.
(h) The Partnership agrees that, unless it has or shall have obtained the prior written
consent of the Representatives, and each Underwriter, severally and not jointly,
agrees with the Partnership that, unless it has or shall have obtained, as the case may
be, the prior written consent of the Partnership, it has not made and will not make any
offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or
that would otherwise constitute a free writing prospectus (as defined in Rule 405)
required to be filed by the Partnership with the Commission or retained by the Partnership
under Rule 433; provided that the prior written consent of the parties hereto shall be
deemed to have been given in respect of the Free Writing Prospectuses included in
Schedule II
hereto and any electronic road show. Any such free writing prospectus
consented to by the Representatives or the Partnership is hereinafter referred to as a
Permitted Free Writing Prospectus
. The Partnership agrees that (x) it has treated and
will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free
Writing Prospectus and (y) it has complied and will comply, as the case may be, with the
requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus,
including in respect of timely filing with the Commission, legending and record keeping.
(i) The Partnership will prepare a final term sheet relating to the Securities,
containing only information that describes the final terms of the Securities and otherwise
in a form consented to by the Representatives, and will file such final term sheet within
the period required by Rule 433(d)(5)(ii) following the date such final terms have been
established for all classes of the offering of the Securities. Any such final term sheet is
an Issuer Free Writing Prospectus and a Permitted Free Writing Prospectus for purposes of
this Agreement. The Partnership also consents to the use by any Underwriter of a free
writing prospectus that contains only (i)(x) information describing the preliminary terms of
the Securities or their offering, (y) information permitted by Rule 134, or (z) information
that describes the final terms of the Securities or their offering and that is included in
the final term sheet of the Partnership contemplated in the first sentence of this
subsection or (ii) other information that is not issuer information, as defined in Rule
433, it being understood that any such free writing prospectus referred to in clause (i) or
(ii) above shall not be an Issuer Free Writing Prospectus for purposes of this Agreement.
(j) The Partnership will not take, directly or indirectly, any action designed to or
that would constitute or that might reasonably be expected to cause or result in, under the
Exchange Act or otherwise, stabilization or manipulation of the price of any security of the
Partnership to facilitate the sale or resale of the Securities.
(k) The Partnership will not offer, sell, contract to sell, pledge or otherwise dispose
of, directly or indirectly, or file with the Commission a registration statement under the
Securities Act relating to United States dollar-denominated debt securities issued or
guaranteed by the Partnership and having a maturity of more than one year from the date of
issue, or publicly disclose the intention to make any such offer, sale, pledge,
-18-
disposition
or filing, without the prior written consent of the Representatives for a period beginning
on the date hereof and ending 30 days after the Closing Date.
(l) The Partnership will use the net proceeds received in connection with the offering
in the manner described in the Use of Proceeds section of the Disclosure Package and the
Final Prospectus and, except as disclosed in the Disclosure Package, the
Partnership does not intend to use any of the proceeds from the sale of the Securities
hereunder to repay any outstanding debt owed to any affiliate of any Underwriter.
(m) The Partnership agrees to pay the costs and expenses relating to the following
matters: (i) the preparation, printing or reproduction and filing with the Commission of
the Registration Statement (including financial statements and exhibits thereto), each
Preliminary Prospectus, the Final Prospectus, each Issuer Free Writing Prospectus and the
Indenture, and each amendment or supplement to any of them; (ii) the printing (or
reproduction) and delivery (including postage, air freight charges and charges for counting
and packaging) of such copies of the Registration Statement, each Preliminary Prospectus,
the Final Prospectus, each Issuer Free Writing Prospectus, and the Indenture, and all
amendments or supplements to any of them, as may, in each case, be reasonably requested for
use in connection with the offering and sale of the Securities; (iii) the preparation,
printing, authentication, issuance and delivery of certificates for the Securities,
including any stamp or transfer taxes in connection with the original issuance and sale of
the Securities; (iv) the printing (or reproduction) and delivery of this Agreement, any blue
sky memorandum and all other agreements or documents printed (or reproduced) and delivered
in connection with the offering of the Securities; (v) any registration or qualification of
the Securities for offer and sale under the securities or blue sky laws of the several
states (including filing fees and the reasonable fees and expenses of counsel for the
Underwriters relating to such registration and qualification); (vi) the transportation and
other expenses incurred by or on behalf of Partnership representatives in connection with
presentations to prospective purchasers of the Securities; (vii) the fees and expenses of
the Partnerships accountants and the fees and expenses of counsel (including local and
special counsel) for the Partnership; (viii) the fees and expenses of the Trustee and its
professional advisers; (ix) any fees charged by investment rating agencies for the rating of
the Securities; and (x) all other costs and expenses incident to the performance by the
Partnership of its obligations hereunder.
(n) The Partnership will use its best efforts to permit the Securities to be eligible
for clearance and settlement through DTC.
6.
Conditions to the Obligations of the Underwriters
. The obligations of the several
Underwriters to purchase the Securities on the Closing Date shall be subject to the accuracy of the
representations and warranties on the part of the Partnership contained herein as of the Execution
Time and the Closing Date, to the accuracy of the statements of the Partnership or ETP LLC made in
any certificates pursuant to the provisions hereof, to the performance by the Partnership of its
obligations hereunder and to the following additional conditions precedent:
(a) The Final Prospectus, and any supplement thereto, have been filed in the manner and
within the time period required by Rule 424(b); and any material required to
-19-
be filed by the
Partnership pursuant to Rule 433(d) under the Securities Act, shall have been filed with the
Commission within the applicable time periods prescribed for such filings by Rule 433; and
no stop order suspending the effectiveness of the Registration Statement or any notice
objecting to its use shall have been issued and no proceedings for that purpose shall have
been instituted or threatened.
(b) The Partnership shall have requested and caused (i) Latham & Watkins LLP, counsel
for the Partnership, to have furnished to the Representatives their opinions and negative
assurance letter, dated the Closing Date, and addressed to the Underwriters, in the forms
set forth in
Exhibits A-1
,
A-2
, and
A-3
hereto.
(c) The Representatives shall have received from Andrews Kurth LLP, counsel for the
Underwriters, such opinion or opinions, dated the Closing Date and addressed to the
Underwriters, with respect to the issuance and sale of the Securities, the Registration
Statement, the Disclosure Package, the Final Prospectus (together with any supplement
thereto) and other related matters as the Representatives may reasonably require, and the
Partnership shall have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(d) The Partnership shall have furnished to the Representatives a certificate of ETP
LLC, signed by its Chief Executive Officer and Chief Financial Officer, dated the Closing
Date, to the effect that the signers of such certificate have carefully examined the
Registration Statement, the Disclosure Package, the Final Prospectus and any supplements or
amendments thereto, as well as each electronic road show used in connection with the
offering of the Securities, and this Agreement and that:
(i) the representations and warranties of the Partnership in this Agreement are
true and correct on and as of the Closing Date, with the same effect as if made on
the Closing Date;
(ii) the Partnership has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the Closing Date;
(iii) no stop order suspending the effectiveness of the Registration Statement
or any notice objecting to its use has been issued and no proceedings for that
purpose have been instituted or, to the Partnerships knowledge, threatened; and
(iv) since the date of the most recent financial statements included in the
Disclosure Package and the Final Prospectus (exclusive of any supplement thereto),
there has been no Material Adverse Effect, whether or not arising from transactions
in the ordinary course of business, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus (exclusive of any supplement thereto).
(e) The Partnership shall have requested and caused Grant Thornton LLP to have
furnished to the Underwriters, at the Execution Time and at the Closing Date, letters
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addressed to the Underwriters (which may refer to letters previously delivered to one or
more of the Underwriters), dated respectively as of the Execution Time and as of the Closing
Date, in form and substance satisfactory to the Representatives, which letters shall, (i)
confirm that they are independent registered public accountants within the meaning of the
Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission, and (ii) state, as of the date of such letters (or, with respect to matters
involving changes or developments since the respective dates as of which specified financial
information is given in the Disclosure Package and the Final Prospectus, as of a date not
more than five days prior to the date of such letters), the conclusions and findings of such
firm with respect to the financial information and other matters ordinarily covered by
accountants comfort letters to underwriters in connection with public offerings of
securities.
(f) Subsequent to the Execution Time or, if earlier, the dates as of which information
is given in the Registration Statement (exclusive of any amendment thereof) and the Final
Prospectus (exclusive of any amendment or supplement thereto), there shall not have been (i)
any material change or material decrease specified in the letter or letters referred to in
Section 6(e)
, or (ii) any change, or any development involving a prospective change,
in or affecting the condition (financial or otherwise), earnings, business or properties of
the Partnership and the Subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or contemplated in
the Disclosure Package and the Final Prospectus (exclusive of any amendment or supplement
thereto), the effect of which, in any case referred to in
clause (i)
or
(ii)
above, is, in the sole judgment of the Representatives, so material and adverse as to make
it impractical or inadvisable to proceed with the offering or delivery of the Securities as
contemplated by the Registration Statement (exclusive of any amendment thereof), the
Disclosure Package and the Final Prospectus (exclusive of any amendment or supplement
thereto).
(g) Subsequent to the Execution Time, there shall not have been any decrease in the
rating of any of the Partnerships or the Subsidiaries debt securities by any nationally
recognized statistical rating organization (as defined for purposes of Rule 436(g)(2) as in
effect on July 20, 2010) or any notice given of any intended or potential decrease in any
such rating or of a possible change in any such rating that does not indicate the direction
of the possible change.
(h) The Partnership shall have furnished to the Representatives such other documents
and certificates as to the accuracy and completeness of any statement in the Registration
Statement, the Disclosure Package and the Final Prospectus as of the Closing Date as the
Representatives may reasonably request.
If any of the conditions specified in this
Section 6
shall not have been fulfilled
when and as provided in this Agreement, or if any of the opinions and certificates mentioned above
or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance to the
Representatives and counsel for the Underwriters, this Agreement and all obligations of the
Underwriters hereunder may be canceled at, or at any time prior to, the Closing Date by the
-21-
Representatives. Notice of such cancellation shall be given to the Partnership in
writing or by telephone or facsimile confirmed in writing.
7.
Reimbursement of Underwriters Expenses
. If the sale of the Securities provided
for herein is not consummated because any condition to the obligations of the Underwriters set
forth in
Section 6
hereof is not satisfied, because of any termination pursuant to
Section 10
hereof or because of any refusal, inability or failure on the part of the
Partnership to perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Partnership will reimburse the Underwriters
severally through RBS Securities Inc. on demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.
8.
Indemnification and Contribution
.
(a) The Partnership agrees to indemnify and hold harmless each Underwriter, the
directors, officers, employees and agents of each Underwriter, affiliates of any Underwriter
who have, or who are alleged to have, participated in the distribution of the Securities as
underwriters, and each person who controls any Underwriter within the meaning of either the
Securities Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject under the
Securities Act, the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement for the registration of
the Securities as originally filed or in any amendment thereof, or in the Base Prospectus,
any Preliminary Prospectus or any other preliminary prospectus supplement relating to the
Securities, the Final Prospectus, any Issuer Free Writing Prospectus, or in any amendment
thereof or supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and agrees to reimburse each such indemnified party,
as incurred, for any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided
,
however
, that the Partnership will not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or is based upon
any such untrue statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to the
Partnership by or on behalf of any Underwriter through the Representatives specifically for
inclusion therein. This indemnity agreement will be in addition to any liability which the
Partnership may otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify and hold harmless
the Partnership, each of its directors, each of its officers who signs the Registration
Statement, and each person who controls the Partnership within the meaning of either the
Securities Act or the Exchange Act, to the same extent as the foregoing indemnity from the
Partnership to each Underwriter, but only with reference to written information relating to
such Underwriter furnished to the Partnership by or on behalf of
-22-
such Underwriter through the Representatives specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will be in
addition to any liability which any Underwriter may otherwise have. The Partnership
acknowledges that the statements set forth (i) in the last paragraph of the cover page
regarding delivery of the Securities and, under the heading Underwriting, (ii) the list of
Underwriters and their respective participation in the sale of the Securities, (iii) the
sentences related to concessions and reallowances and (iv) the paragraph related to
stabilization, syndicate covering transactions and penalty bids in any Preliminary
Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus constitute the only
information furnished in writing by or on behalf of the several Underwriters for inclusion
in any Preliminary Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8
of
notice of the commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this
Section 8
, notify
the indemnifying party in writing of the commencement thereof; but the failure so to notify
the indemnifying party (i) will not relieve it from liability under
paragraph (a)
or
(b)
above unless and to the extent it did not otherwise learn of such action and
such failure results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation provided in
paragraph (a)
or
(b)
above. The indemnifying party shall be entitled to
appoint counsel of the indemnifying partys choice at the indemnifying partys expense to
represent the indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and expenses of
any separate counsel retained by the indemnified party or parties except as set forth
below);
provided
,
however
, that such counsel shall be satisfactory to the
indemnified party. Notwithstanding the indemnifying partys election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have the right to
employ separate counsel (including local counsel), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the use of counsel
chosen by the indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets
of, any such action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal defenses available
to it and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, (iii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified party within a
reasonable time after notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the expense of the
indemnifying party. An indemnifying party will not, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the indemnified
parties are actual or potential parties to such claim or action) unless such settlement,
compromise or consent (i) includes an unconditional release of the indemnified party from
all liability arising out of such action, suit, proceeding or claim
-23-
and (ii) does not include a statement as to or an admission of fault, culpability or a
failure to act, by or on behalf of any indemnified party.
(d) In the event that the indemnity provided in this
Section 8
is unavailable
to or insufficient to hold harmless an indemnified party for any reason, the Partnership and
the Underwriters severally agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection with
investigating or defending the same) (collectively,
Losses
) to which the Partnership and
one or more of the Underwriters may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Partnership, on the one hand, and by the
Underwriters, on the other, from the offering of the Securities; provided, however, that in
no case shall any Underwriter (except as may be provided in any agreement among underwriters
relating to the offering of the Securities) be responsible for any amount in excess of the
underwriting discount or commission applicable to the Securities purchased by such
Underwriter hereunder. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Partnership and the Underwriters severally shall contribute
in such proportion as is appropriate to reflect not only such relative benefits but also the
relative fault of the Partnership, on the one hand, and of the Underwriters, on the other,
in connection with the statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative benefits received by the Partnership,
on the one hand, and the Underwriters, on the other, shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting expenses) received
by the Partnership bear to the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth on the cover page of the Final Prospectus. The
relative fault shall be determined by reference to, among other things, whether any untrue
or any alleged untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information provided by the Partnership, on the one hand,
or the Underwriters, on the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such untrue statement or
omission. The Partnership and the Underwriters agree that it would not be just and
equitable if contribution were determined by pro rata allocation or any other method of
allocation that does not take account of the equitable considerations referred to above.
The amount paid by an indemnified party as a result of Losses shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim that is the subject of this
paragraph
(d)
. Notwithstanding the provisions of this
paragraph (d)
, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total underwriting
discounts and commissions received by such Underwriter with respect to the offering of the
Securities exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this
paragraph (d)
, no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this
Section 8
, each person who controls an
Underwriter within the meaning of either the Securities Act or the Exchange Act and each
director, officer, employee and agent of an Underwriter shall have the same rights to
contribution as such Underwriter, and each person who controls
-24-
the Partnership within the meaning of either the Securities Act or the Exchange Act,
each officer of the Partnership who shall have signed the Registration Statement and each
director of the Partnership shall have the same rights to contribution as the Partnership,
subject in each case to the applicable terms and conditions of this
paragraph (d)
.
9.
Default by an Underwriter
. If any one or more Underwriters shall fail to purchase
and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters
hereunder and such failure to purchase shall constitute a default in the performance of its or
their obligations under this Agreement, the remaining Underwriters shall be obligated severally to
take up and pay for (in the respective proportions which the amount of Securities set forth
opposite their names in
Schedule I
hereto bears to the aggregate amount of Securities set
forth opposite the names of all the remaining Underwriters) the Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase;
provided
,
however
, that
in the event that the aggregate amount of Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase shall exceed 10% of the aggregate amount of Securities
set forth in
Schedule I
hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities, and if such
non-defaulting Underwriters do not purchase all the Securities, this Agreement will terminate
without liability to any non-defaulting Underwriter or the Partnership. In the event of a default
by any Underwriter as set forth in this
Section 9
, the Closing Date shall be postponed for
such period, not exceeding five Business Days, as the Representatives shall determine in order that
the required changes in the Registration Statement and the Final Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any
defaulting Underwriter of its liability, if any, to the Partnership and any non-defaulting
Underwriter for damages occasioned by its default hereunder.
10.
Termination
. This Agreement shall be subject to termination in the absolute
discretion of the Representatives, by notice given to the Partnership prior to delivery of and
payment for the Securities, if at any time prior to such delivery and payment (i) trading in of any
securities of the Partnership shall have been suspended by the Commission or the NYSE or trading in
securities generally on the NYSE shall have been suspended or limited or minimum prices shall have
been established on such exchange, (ii) a banking moratorium shall have been declared either by
Federal or New York State authorities, or (iii) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States of a national emergency or war, or
other calamity or crisis, the effect of which is such as to make it, in the sole judgment of the
Representatives, impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by any Preliminary Prospectus or the Final Prospectus (exclusive of any
amendment or supplement thereto).
11.
Representations and Indemnities to Survive
. The respective agreements,
representations, warranties, indemnities and other statements of the Partnership or the officers of
ETP LLC and of the Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation made by or on behalf of any Underwriter or the
Partnership or any of the officers, directors, employees, agents or controlling persons referred to
in
Section 8
hereof, and will survive delivery of and payment for the Securities. The
provisions of
Sections 7
and
8
hereof shall survive the termination or cancellation
of this Agreement.
-25-
12.
Notices
. All communications hereunder shall be in writing and effective only on
receipt, and, if sent to the Underwriters, shall be mailed, delivered or faxed and confirmed to the
Representatives, c/o RBS Securities Inc., 600 Washington Blvd., Stamford, Connecticut 06901,
Attention: Debt Capital Markets Syndicate, Fax: (203) 873-4534, or, if sent to the Partnership,
shall be mailed, delivered or faxed and confirmed to it at Energy Transfer Partners, L.P., 3738 Oak
Lawn Avenue, Dallas, Texas 75219, Attention: General Counsel, Fax: (832) 668-1127 and confirmed to
it at (832) 668-1210, attention of the Legal Department.
13.
Successors
. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors, employees, agents and
controlling persons referred to in
Section 8
hereof, and no other person shall have any
right or obligation hereunder.
14.
Representation of Underwriters
. The Representatives shall act for the several
Underwriters in connection with this financing, and any action under this Agreement taken by the
Representatives shall be binding upon all the Underwriters.
15.
No Fiduciary Duty
. The Partnership hereby acknowledges that (a) the purchase and
sale of the Securities pursuant to this Agreement is an arms-length commercial transaction between
the Partnership, on the one hand, and the Underwriters and any affiliate through which it may be
acting, on the other, (b) the Underwriters are acting as principal and not as an agent or fiduciary
of the Partnership and (c) the Partnerships engagement of the Underwriters in connection with the
offering and the process leading up to the offering is as independent contractors and not in any
other capacity. Furthermore, the Partnership agrees that it is solely responsible for making its
own judgments in connection with the offering (irrespective of whether any of the Underwriters has
advised or is currently advising the Partnership on related or other matters). The Partnership
agrees that it will not claim that the Underwriters have rendered advisory services of any nature
or respect, or owe an agency, fiduciary or similar duty to the Partnership, in connection with such
transaction or the process leading thereto.
16.
Integration
. This Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Partnership and the Underwriters, or any of them, with
respect to the subject matter hereof.
17.
Applicable Law
. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York applicable to contracts made and to be performed within the
State of New York. The Partnership hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in the City of New York in any suit or proceeding
arising out of or relating to this Agreement or the transactions contemplated hereby. The
Partnership irrevocably and unconditionally waives any objection to the laying of venue of any suit
or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby
in Federal and state courts in the Borough of Manhattan in the City of New York and irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that any such suit or
proceeding in any such court has been brought in an inconvenient forum.
-26-
18.
Waiver of Jury Trial
. The Partnership hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Agreement or the transactions contemplated hereby.
19.
Counterparts
. This Agreement may be executed in any number of counterparts, each
of which shall constitute an original and all of which together shall constitute one and the same
agreement.
20.
Headings
. The section headings used herein are for convenience only and shall not
affect the construction hereof.
21.
Definitions
. The terms that follow, when used in this Agreement, shall have the
meanings indicated.
430B Information
means information included in a prospectus then deemed to be a part of the
Registration Statement pursuant to Rule 430B(e) or retroactively deemed to be a part of the
Registration Statement pursuant to Rule 430B(f).
Applicable Time
means 5:30 p.m., Eastern time, on the date of this Agreement.
Base Prospectus
shall mean the base prospectus referred to in
paragraph 1(a)
above
contained in the Registration Statement at the Execution Time.
Business Day
shall mean any day other than a Saturday, a Sunday or a legal holiday or a day
on which banking institutions or trust companies are authorized or obligated by law to close in New
York City or Houston, Texas.
Closing Date
has the meaning defined in
Section 3
hereof.
Commission
shall mean the Securities and Exchange Commission.
Disclosure Package
shall mean (i) the Base Prospectus, (ii) the Preliminary Prospectus used
most recently prior to the Execution Time, (iii) the Issuer Free Writing Prospectuses and pricing
information identified in
Schedule II
hereto, and (iv) any other Free Writing Prospectus
that the parties hereto shall hereafter expressly agree in writing to treat as part of the
Disclosure Package.
Effective Date
shall mean each date and time that the Registration Statement and any
post-effective amendment or amendments thereto became or becomes effective.
Exchange Act
shall mean the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.
Execution Time
shall mean the date and time that this Agreement is executed and delivered by
the parties hereto.
-27-
Final Prospectus
means the Statutory Prospectus that discloses the public offering price,
other 430B Information and other final terms of the Securities and otherwise satisfies Section
10(a) of the Securities Act.
Free Writing Prospectus
shall mean a free writing prospectus, as defined in Rule 405.
General Use Issuer Free Writing Prospectus
means any Issuer Free Writing Prospectus that is
intended for general distribution to prospective investors, as evidenced by its being so specified
in Schedule II to this Agreement.
Issuer Free Writing Prospectus
shall mean any issuer free writing prospectus, as defined
in Rule 433, relating to the Securities in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the Partnerships records
pursuant to Rule 433(g).
Limited Use Issuer Free Writing Prospectus
means any Issuer Free Writing Prospectus that is
not a General Use Issuer Free Writing Prospectus.
Preliminary Prospectus
shall mean any preliminary prospectus supplement to the Base
Prospectus referred to in
paragraph 1(a)
above which is used prior to the filing of the
Final Prospectus, together with the Base Prospectus.
Registration Statement
shall mean the registration statement referred to in
paragraph
1(a)
above, including exhibits and financial statements and any prospectus supplement relating
to the Securities that is filed with the Commission pursuant to Rule 424(b) and deemed part of such
registration statement pursuant to Rule 430B, as amended on each Effective Date and, in the event
any post-effective amendment thereto becomes effective prior to the Closing Date, shall also mean
such registration statement as so amended.
Rules and Regulations
means the rules and regulations of the Commission.
Securities Act
shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
Securities Laws
means, collectively, the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley), the
Securities Act, the Exchange Act, the Trust Indenture Act, the Rules and Regulations, the auditing
principles, rules, standards and practices applicable to auditors of issuers (as defined in
Sarbanes-Oxley) promulgated or approved by the Public Company Accounting Oversight Board and, as
applicable, the rules of the New York Stock Exchange and the NASDAQ Stock Market (Exchange
Rules).
Statutory Prospectus
with reference to any particular time means the prospectus relating to
the Securities that is included in the Registration Statement immediately prior to that time,
including all 430B Information with respect to the Registration Statement. For purposes of the
foregoing definition, 430B Information shall be considered to be included in the Statutory
Prospectus only as of the actual time that form of prospectus (including a prospectus supplement)
is filed with the Commission pursuant to Rule 424(b) and not retroactively.
-28-
Trust Indenture Act
means the Trust Indenture Act of 1939, as amended, and the rules and
regulations promulgated thereunder.
Well-Known Seasoned Issuer
shall mean a well-known seasoned issuer, as defined in Rule 405.
-29-
If the foregoing is in accordance with the Representatives understanding of our agreement,
kindly sign and return to the Partnership one of the counterparts hereof, whereupon it shall become
a binding agreement between the Partnership and the several Underwriters in accordance with its
terms.
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Very truly yours,
Energy Transfer Partners, L.P.
|
|
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By:
|
Energy Transfer Partners GP, L.P.,
|
|
|
|
its general partner
|
|
|
|
|
|
By:
|
Energy Transfer Partners, L.L.C.
|
|
|
|
its general partner
|
|
|
|
|
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By:
|
/s/ Martin Salinas, Jr.
|
|
|
|
Name:
|
Martin Salinas, Jr.
|
|
|
|
Title:
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Chief Financial Officer
|
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The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
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RBS Securities Inc.
|
|
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By:
|
/s/ Mark Frenzel
|
|
|
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Name:
|
Mark Frenzel
|
|
|
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Title:
|
Director
|
|
|
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Credit Suisse Securities (USA) LLC
|
|
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By:
|
/s/ Helena M. Willner
|
|
|
|
Name:
|
Helena M. Willner
|
|
|
|
Title:
|
Director
|
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|
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SunTrust Robinson Humphrey, Inc.
|
|
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By:
|
/s/ Christopher S. Grumboski
|
|
|
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Name:
|
Christopher S. Grumboski
|
|
|
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Title:
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Director
|
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BNP Paribas Securities Corp.
|
|
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By:
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/s/ Jim Turner
|
|
|
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Name:
|
Jim Turner
|
|
|
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Title:
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Managing Director
|
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-31-
|
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Deutsche Bank Securities Inc.
|
|
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By:
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/s/ Ben Smilchensky
|
|
|
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Name:
|
Ben Smilchensky
|
|
|
|
Title:
|
Managing Director
|
|
|
|
|
|
|
By:
|
/s/ John C. McCabe
|
|
|
|
Name:
|
John C. McCabe
|
|
|
|
Title:
|
Director
|
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|
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For themselves and the other
several Underwriters,
named in
Schedule I
to the
foregoing Agreement.
-32-
SCHEDULE I
|
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|
|
|
|
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|
|
|
Principal Amount of
|
|
|
Principal Amount of
|
|
Underwriter
|
|
2021 Notes
|
|
|
2041 Notes
|
|
|
|
|
|
|
|
|
|
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RBS Securities Inc.
|
|
$
|
128,000,000
|
|
|
$
|
112,000,000
|
|
Credit Suisse Securities (USA) LLC
|
|
|
128,000,000
|
|
|
|
112,000,000
|
|
SunTrust Robinson Humphrey, Inc.
|
|
|
128,000,000
|
|
|
|
112,000,000
|
|
BNP Paribas Securities Corp.
|
|
|
88,000,000
|
|
|
|
77,000,000
|
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Deutsche Bank Securities Inc.
|
|
|
88,000,000
|
|
|
|
77,000,000
|
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DnB NOR Markets, Inc.
|
|
|
64,000,000
|
|
|
|
56,000,000
|
|
RBC Capital Markets, LLC
|
|
|
64,000,000
|
|
|
|
56,000,000
|
|
UBS Securities LLC
|
|
|
64,000,000
|
|
|
|
56,000,000
|
|
Mitsubishi UFJ Securities (USA), Inc.
|
|
|
24,000,000
|
|
|
|
21,000,000
|
|
U.S. Bancorp Investments, Inc.
|
|
|
24,000,000
|
|
|
|
21,000,000
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
800,000,000
|
|
|
$
|
700,000,000
|
|
Schedule I-1
SCHEDULE II
(i)
|
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General Use Free Writing Prospectuses (included in the Disclosure Package)
|
General Use Issuer Free Writing Prospectus includes the following document:
(1) Final term sheet, dated May 9, 2011, for the
Securities.
(ii)
|
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Other Information Included in the Disclosure Package
|
The following information is also included in the Disclosure Package:
None
Schedule II-1
ENERGY TRANSFER PARTNERS, L.P.
4.65% Senior Notes due 2021
6.05% Senior Notes due 2041
Pricing Term Sheet
|
|
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|
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Issuer:
|
|
Energy Transfer Partners, L.P.
|
|
|
Ratings:
|
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*
|
|
|
Security Type:
|
|
Senior Unsecured Notes
|
|
|
Denominations/Multiple:
|
|
$2,000 x $1,000
|
|
|
Pricing Date:
|
|
May 9, 2011
|
|
|
Settlement Date:
|
|
May 12, 2011
|
|
|
|
|
4.65% Senior Notes due 2021
|
|
6.05% Senior Notes due 2041
|
Maturity Date:
|
|
June 1, 2021
|
|
June 1, 2041
|
Principal Amount:
|
|
$800,000,000
|
|
$700,000,000
|
Benchmark Treasury:
|
|
3.625% due February 15, 2021
|
|
4.25% due November 15, 2040
|
Benchmark Yield:
|
|
3.140%
|
|
4.318%
|
Spread to Benchmark:
|
|
+155 bps
|
|
+175 bps
|
Yield to Maturity:
|
|
4.690%
|
|
6.068%
|
Coupon:
|
|
4.65%
|
|
6.05%
|
Public Offering Price:
|
|
99.679%
|
|
99.747%
|
Gross Spread:
|
|
0.650%
|
|
0.875%
|
Net Proceeds to Issuer
(after underwriting fees):
|
|
$792,232,000
|
|
$692,104,000
|
Optional Redemption:
|
|
|
|
|
Make-Whole Call:
|
|
T + 25 bps prior to March 1, 2021
|
|
T +25 bps prior to December 1, 2040
|
Call at Par:
|
|
On or after March 1, 2021
|
|
On or after December 1, 2040
|
Interest Payment Period:
|
|
Semi-Annually
|
|
Semi-Annually
|
Interest Payment Dates:
|
|
June 1 and December 1,
|
|
June 1 and December 1,
|
|
|
beginning December 1, 2011
|
|
beginning December 1, 2011
|
Interest Record Dates:
|
|
May 15 and November 15
|
|
May 15 and November 15
|
CUSIP / ISIN:
|
|
29273RAN9 / US29273RAN98
|
|
29273RAP4 / US29273RAP47
|
Schedule II-2
|
|
|
Joint Bookrunning Managers:
|
|
RBS Securities Inc.
|
|
|
Credit Suisse Securities (USA) LLC
|
|
|
SunTrust Robinson Humphrey, Inc.
|
|
|
BNP Paribas Securities Corp.
|
|
|
Deutsche Bank Securities Inc.
|
Co-Managers:
|
|
DnB NOR Markets, Inc.
|
|
|
RBC Capital Markets, LLC
|
|
|
UBS Securities LLC
|
|
|
Mitsubishi UFJ Securities (USA), Inc.
|
|
|
U.S. Bancorp Investments, Inc.
|
|
|
|
*
|
|
Note: A securities rating is not a recommendation to buy, sell or hold a security and may be
subject to revision or withdrawal at any time.
|
The issuer has filed a registration statement (including a base prospectus and a prospectus
supplement) with the U.S. Securities and Exchange Commission, or the SEC, for the offering to which
this communication relates. Before you invest, you should read the prospectus supplement for this
offering, the prospectus in that registration statement and any other documents the issuer has
filed with the SEC for more complete information about the issuer and this offering. You may get
these documents for free by searching the SECs online database (EDGAR) on the SEC web site at
http://www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the
offering will arrange to send you the prospectus supplement and prospectus if you request it by
calling RBS Securities Inc. at (866) 884-2071, Credit Suisse Securities (USA) LLC at (800)
221-1037, SunTrust Robinson Humphrey, Inc. at (800) 685-4786, BNP Paribas Securities Corp. at (800)
854-5674 and Deutsche Bank Securities Inc. at (800) 503-4611.
Schedule II-3
SCHEDULE III
|
|
|
Entity
|
|
Jurisdiction in which registered
|
Energy Transfer Partners, L.L.C.
|
|
Delaware
|
Energy Transfer Partners GP, L.P.
|
|
Delaware
|
Energy Transfer Partners, L.P.
|
|
Delaware
|
Schedule III-1
SCHEDULE IV
|
|
Chalkley Gathering Company, LLC, a Texas limited liability company
|
|
|
|
Energy Transfer del Peru S.R.L., a Peruvian limited liability company
|
|
|
|
Energy Transfer Fuel GP, LLC, a Delaware limited liability company
|
|
|
|
Energy Transfer Fuel, LP, a Delaware limited partnership
|
|
|
|
Energy Transfer Group, LLC, a Texas limited liability company
|
|
|
|
Energy Transfer International Holdings LLC, a Delaware limited liability company
|
|
|
|
Energy Transfer Interstate Holdings, LLC, a Delaware limited liability company
|
|
|
|
Energy Transfer Mexicana, LLC, a Delaware limited liability company
|
|
|
|
Energy Transfer Peru LLC, a Delaware limited liability company
|
|
|
|
Energy Transfer Retail Power, LLC, a Delaware limited liability company
|
|
|
|
Energy Transfer Technologies, Ltd., a Texas limited partnership
|
|
|
|
Energy Transfer Water Solutions JV, LLC, a Delaware limited liability company (50% interest)
|
|
|
|
ET Company I, Ltd., a Texas limited partnership
|
|
|
|
ET Fuel Pipeline, L.P., a Delaware limited partnership
|
|
|
|
ETC Canyon Pipeline, LLC, a Delaware limited liability company
|
|
|
|
ETC Compression, LLC, a Delaware limited liability company
|
|
|
|
ETC Energy Transfer, LLC, a Delaware limited liability company
|
|
|
|
ETC Fayetteville Express Pipeline, LLC, a Delaware limited liability company
|
|
|
|
ETC Fayetteville Operating Company, LLC, a Delaware limited liability company
|
|
|
|
ETC Gas Company Ltd., a Texas limited partnership
|
|
|
|
ETC Gathering, LLC, a Texas limited liability company
|
|
|
|
ETC Interstate Procurement Company, LLC, a Delaware limited liability company
|
|
|
|
ETC Intrastate Procurement Company, LLC, a Delaware limited liability company
|
|
|
|
ETC Katy Pipeline, Ltd., a Texas limited partnership
|
|
|
|
ETC Lion Pipeline, LLC, a Delaware limited liability company
|
|
|
|
ETC Marketing, Ltd., a Texas limited partnership
|
|
|
|
ETC Midcontinent Express Pipeline, L.L.C., a Delaware limited liability company
|
|
|
|
ETC Midcontinent Express Pipeline II, L.L.C., a Delaware limited liability company
|
|
|
|
ETC New Mexico Pipeline, L.P., a New Mexico limited partnership
|
|
|
|
ETC NGL Transport, LLC, a Texas limited liability company
|
|
|
|
ETC Northeast Pipeline, LLC, a Delaware limited liability company
|
|
|
|
ETC Oasis GP, LLC a Texas limited liability company
|
|
|
|
ETC Oasis, L.P., a Delaware limited partnership
|
|
|
|
ETC Texas Pipeline, Ltd., a Texas limited partnership
|
|
|
|
ETC Tiger Pipeline, LLC, a Delaware limited liability company
|
|
|
|
ETC Water Solutions, LLC, a Delaware limited liability company
|
|
|
|
Fayetteville Express Pipeline, LLC, a Delaware limited liability company (50% interest)
|
|
|
|
FEP Arkansas Pipeline, LLC, an Arkansas limited liability company (50% interest of the sole
member)
|
|
|
|
Fermaca Pipeline Anahauc, S. del R.L.de CV, a Mexico limited liability company (50% interest
acquired 5/2010)
|
|
|
|
Five Dawaco, LLC, a Texas limited liability company
|
|
|
|
Heritage Energy Resources, L.L.C., an Oklahoma limited liability company
|
|
|
|
Heritage ETC GP, L.L.C., a Delaware limited liability company
|
Schedule IV-1
|
|
Heritage ETC, L.P., a Delaware limited partnership
|
|
|
|
Heritage Holdings, Inc., a Delaware corporation
|
|
|
|
Heritage LP, Inc., a Delaware corporation
|
|
|
|
Heritage Operating L.P., a Delaware limited partnership
|
|
|
|
Heritage Service Corp., a Delaware corporation
|
|
|
|
Houston Pipe Line Company LP, a Delaware limited partnership
|
|
|
|
HP Houston Holdings, L.P., a Delaware limited partnership
|
|
|
|
HPL Asset Holdings LP, a Delaware limited partnership
|
|
|
|
HPL Consolidation LP, a Delaware limited partnership
|
|
|
|
HPL GP, LLC, a Delaware limited liability company
|
|
|
|
HPL Holdings GP, L.L.C., a Delaware limited liability company
|
|
|
|
HPL Houston Pipe Line Company, LLC, a Delaware limited liability company
|
|
|
|
HPL Leaseco LP, a Delaware limited partnership
|
|
|
|
HPL Resources Company LP, a Delaware limited partnership
|
|
|
|
HPL Storage GP LLC, a Delaware limited liability company
|
|
|
|
LA GP, LLC, a Texas limited liability company
|
|
|
|
La Grange Acquisition, L.P., a Texas limited partnership
|
|
|
|
LG PL, LLC, a Texas limited liability company
|
|
|
|
LGM, LLC, a Texas limited liability company
|
|
|
|
Lone Star NGL Asset GP LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Asset Holdings LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Asset Holdings II LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Development LP, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Hastings LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Hattiesburg LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Mont Belvieu GP LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Mont Belvieu LP, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Pipeline LP, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Product Services LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Refinery Services LLC, a Delaware limited liability company (70% interest)
|
|
|
|
Lone Star NGL Sea Robin LLC, a Delaware limited liability company (70% interest)
|
|
|
|
M-P Oils Ltd., an Alberta corporation
|
|
|
|
Oasis Partner Company, a Delaware corporation
|
|
|
|
Oasis Pipe Line Company Texas L.P., a Texas limited partnership
|
|
|
|
Oasis Pipe Line Company, a Delaware corporation
|
|
|
|
Oasis Pipe Line Finance Company, a Delaware corporation
|
|
|
|
Oasis Pipe Line Management Company, a Delaware corporation
|
|
|
|
Oasis Pipeline, LP, a Texas limited partnership
|
|
|
|
SEC General Holdings, LLC, a Texas limited liability company
|
|
|
|
SEC Energy Realty GP, LLC, a Texas limited liability company
|
Schedule IV-2
|
|
SEC Energy Products & Services, L.P., a Texas limited partnership
|
|
|
|
SEC-EP Realty Ltd., a Texas limited partnership
|
|
|
|
TETC, LLC, a Texas limited liability company
|
|
|
|
Texas Energy Transfer Company, Ltd., a Texas limited partnership
|
|
|
|
Texas Energy Transfer Power, LLC, a Texas limited liability company
|
|
|
|
Thunder River Venture III, LLC, a Colorado limited liability company
|
|
|
|
Titan Energy GP, L.L.C., a Delaware limited liability company
|
|
|
|
Titan Energy Partners, L.P., a Delaware limited partnership
|
|
|
|
Titan Propane LLC, a Delaware limited partnership
|
|
|
|
Titan Propane Services, Inc., a Delaware corporation
|
|
|
|
Transwestern Pipeline Company, LLC, a Delaware limited liability company
|
|
|
|
Whiskey Bay Gathering Company, LLC, a Texas limited liability company
|
|
|
|
Whiskey Bay Gas Company Ltd., a Texas limited partnership
|
Schedule IV-3
EXHIBIT A-1
OPINION OF LATHAM & WATKINS LLP
1. The Partnership is a limited partnership duly formed under the laws of the State of
Delaware, with limited partnership power and authority to (A) own its properties and to conduct its
business as described in the Registration Statement, the Preliminary Prospectus and the Prospectus
and (B) to perform its obligations under the Underwriting Agreement, the Indenture and the Notes.
With your consent, based solely on certificates from public officials, we confirm that the
Partnership is validly existing and in good standing under the laws of the State of Delaware.
2. The Indenture has been qualified under the Trust Indenture Act of 1939, as amended (the
TIA
).
3. The Notes have been duly authorized by all necessary limited partnership action of the
Partnership and the General Partner and all necessary limited liability company action of ETP LLC
and, when duly executed, issued and authenticated by the Trustee in accordance with the terms of
the Indenture and delivered and paid for in accordance with the terms of the Underwriting
Agreement, will be legally valid and binding obligations of the Partnership, enforceable against
the Partnership in accordance with their terms.
4. The Indenture has been duly authorized by all necessary limited partnership action of the
Partnership and the General Partner and all necessary limited liability company action of ETP LLC,
has been duly executed and delivered by the Partnership and is the legally valid and binding
agreement of the Partnership, enforceable against the Partnership in accordance with its terms.
5. The execution, delivery and performance of the Underwriting Agreement have been duly
authorized by all necessary limited partnership action of the Partnership and the General Partner
and all necessary limited liability company action of ETP LLC, and the Underwriting Agreement has
been duly executed and delivered by the Partnership.
6. The execution and delivery of the Underwriting Agreement and the Indenture and the issuance
and sale of the Notes by the Partnership to you and the other Underwriters pursuant to the
Underwriting Agreement do not on the date hereof:
|
(i)
|
|
violate the Partnership Governing Documents; or
|
|
|
(ii)
|
|
result in the breach of or a default under any of the Specified
Agreements; or
|
Exhibit A-1 1
|
(iii)
|
|
violate any federal, New York or Texas statute, rule or
regulation applicable to the Partnership or the DRULPA or the Delaware LLC Act;
or
|
|
|
(iv)
|
|
result in the creation of any security interest in, or lien
upon, any property or assets of the Partnership or any of its subsidiaries
under any Specified Agreement; or
|
|
|
(v)
|
|
require any consents, approvals, or authorizations to be
obtained by the Partnership from, or any registrations, declarations or filings
to be made by the Partnership with, any governmental authority under any
federal, New York or Texas statute, rule or regulation applicable to the
Partnership or the DRULPA or the Delaware LLC Act that have not been obtained
or made.
|
7. The Registration Statement has become effective under the Securities Act. With your
consent, based solely on a telephonic confirmation by a member of the Staff of the Commission on
May 12, 2011 we confirm that no stop order suspending the effectiveness of the Registration
Statement has been issued under the Securities Act and no proceedings therefor have been initiated
by the Commission. The Preliminary Prospectus has been filed in accordance with Rule 424(b) under
the Securities Act, the Prospectus has been filed in accordance with Rule 424(b) and 430B under the
Securities Act, and each specified IFWP has been filed in accordance with Rule 433(d) under the
Securities Act.
8. The Registration Statement at May 9, 2011, including the information deemed to be a part
thereof pursuant to Rule 430B under the Securities Act, and the Prospectus, as of its date, each
appeared on their face to be appropriately responsive in all material respects to the applicable
form requirements for registration statements on Form S-3 under the Securities Act and the rules
and regulations of the Commission thereunder; it being understood, however, that we express no view
with respect to Regulation S-T or the financial statements, schedules, or other financial data,
included in, incorporated by reference in, or omitted from, the Registration Statement or the
Prospectus or with respect to the Trustees Form T-1 under the TIA. For purposes of this
paragraph, we have assumed that the statements made in the Registration Statement and the
Prospectus are correct and complete.
9. The statements in the Preliminary Prospectus, each Specified IFWP, and the Prospectus under
the caption Description of Notes and Description of the Debt Securities, insofar as they
purport to describe or summarize certain provisions of the Notes or the Indenture, are accurate
descriptions or summaries in all material respects.
10. The Partnership is not, and immediately after giving effect to the sale of the Notes in
accordance with the Underwriting Agreement and the application of the proceeds as described in the
Prospectus under the caption Use of Proceeds, will not be required to be, registered as an
investment company within the meaning of the Investment Company Act of 1940, as amended.
Exhibit A-1 2
EXHIBIT A-2
OPINION OF LATHAM & WATKINS LLP
Negative Assurance Letter
Based on our participation, review and reliance as described above, we advise you that no facts
came to our attention that caused us to believe that:
|
|
|
the Registration Statement,
as of May 9, 2011, including
the information deemed to be a part of the Registration Statement pursuant to
430B under the Securities Act (together with the Incorporated Documents as of
such date),
contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
|
|
|
|
|
the Preliminary Prospectus, as of May 9, 2011 (together with the
Incorporated Documents at that date and each Specified IFWP at that date),
contained an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; or
|
|
|
|
|
the Prospectus, as of its date or as of the date hereof (together
with the Incorporated Documents at those dates), contained or contains an
untrue statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
|
it being understood that we express no belief with respect to the financial statements, schedules,
or other financial data included or incorporated by reference in, or omitted from, the Registration
Statement, the Preliminary Prospectus, each Specified IFWP, the Prospectus, the Incorporated
Documents or the Form T-1.
Exhibit A-2 1
EXHIBIT A-3
TAX OPINION OF LATHAM & WATKINS
Based on such facts and subject to the qualifications, assumptions and limitations set forth
herein and in the Preliminary Prospectus and the Prospectus, we hereby confirm that the statements
in the Preliminary Prospectus and the Prospectus under the caption Certain United States Federal
Income Tax Considerations, insofar as such statements purport to constitute summaries of United
States federal income tax law and regulations or legal conclusions with respect thereto, constitute
accurate summaries of the matters described therein in all material respects.
Annex A-3
Exhibit 4.2
Execution Version
ENERGY TRANSFER PARTNERS, L.P.,
as Issuer,
and
U.S. BANK NATIONAL ASSOCIATION
(AS SUCCESSOR TO
WACHOVIA BANK, NATIONAL ASSOCIATION),
as Trustee
NINTH SUPPLEMENTAL INDENTURE
Dated as of May 12, 2011
to
Indenture dated as of January 18, 2005
4.65% Senior Notes due 2021
6.05% Senior Notes due 2041
Table of Contents
|
|
|
|
|
ARTICLE I DEFINITIONS
|
|
|
1
|
|
SECTION 1.1
Generally
|
|
|
1
|
|
SECTION 1.2
Definition of Certain Terms
|
|
|
2
|
|
|
|
|
|
|
ARTICLE II GENERAL TERMS OF THE NOTES
|
|
|
6
|
|
SECTION 2.1
Form
|
|
|
6
|
|
SECTION 2.2
Title, Amount and Payment of Principal and Interest
|
|
|
7
|
|
SECTION 2.3
Transfer and Exchange
|
|
|
8
|
|
|
|
|
|
|
ARTICLE III FUTURE SUBSIDIARY GUARANTEES
|
|
|
8
|
|
SECTION 3.1
No Initial Guarantee of the Notes by Subsidiary Guarantors
|
|
|
8
|
|
SECTION 3.2
Future Subsidiary Guarantors
|
|
|
8
|
|
SECTION 3.3
Release of Guarantees
|
|
|
9
|
|
SECTION 3.4
Reinstatement of Guarantees
|
|
|
9
|
|
|
|
|
|
|
ARTICLE IV REDEMPTION
|
|
|
9
|
|
SECTION 4.1
Redemption
|
|
|
9
|
|
|
|
|
|
|
ARTICLE V ADDITIONAL COVENANTS
|
|
|
10
|
|
SECTION 5.1
Limitation on Liens
|
|
|
10
|
|
SECTION 5.2
Restriction on Sale-Leasebacks
|
|
|
11
|
|
|
|
|
|
|
ARTICLE VI ADDITIONAL EVENT OF DEFAULT
|
|
|
11
|
|
SECTION 6.1
Additional Event of Default
|
|
|
11
|
|
|
|
|
|
|
ARTICLE VII MISCELLANEOUS PROVISIONS
|
|
|
12
|
|
SECTION 7.1
Ratification of Base Indenture
|
|
|
12
|
|
SECTION 7.2
Trustee Not Responsible for Recitals
|
|
|
12
|
|
SECTION 7.3
Table of Contents, Headings, etc.
|
|
|
12
|
|
SECTION 7.4
Counterpart Originals
|
|
|
12
|
|
SECTION 7.5
Governing Law
|
|
|
12
|
|
i
THIS NINTH SUPPLEMENTAL INDENTURE dated as of May 12, 2011 (the Ninth Supplemental
Indenture), is among Energy Transfer Partners, L.P., a Delaware limited partnership (the
Partnership), and U.S. Bank National Association, a national banking association, as successor to
Wachovia Bank, National Association, a national banking association, as trustee (the Trustee).
RECITALS:
WHEREAS, the Partnership and certain Subsidiary Guarantors have executed and delivered to the
Trustee an Indenture, dated January 18, 2005 (the Base Indenture and as supplemented by this
Ninth Supplemental Indenture, the Indenture), providing for the issuance by the Partnership from
time to time of its debentures, notes, bonds or other evidences of indebtedness to be issued in one
or more series unlimited as to principal amount (the Debt Securities);
WHEREAS, the Partnership has duly authorized and desires to cause to be established pursuant
to the Base Indenture and this Ninth Supplemental Indenture two new series of Debt Securities
designated the 4.65% Senior Notes due 2021 (the 2021 Notes) and the 6.05% Senior Notes due
2041 (the 2041 Notes and together with the 2021 Notes, the Notes);
WHEREAS, Sections 2.01 and 2.03 of the Base Indenture permit the execution of indentures
supplemental thereto to establish the form and terms of Debt Securities of any series;
WHEREAS, pursuant to Section 9.01 of the Base Indenture, the Partnership has requested that
the Trustee join in the execution of this Ninth Supplemental Indenture to establish the form and
terms of the Notes;
WHEREAS, all things necessary have been done to make the Notes, when executed by the
Partnership and authenticated and delivered hereunder and under the Base Indenture and duly issued
by the Partnership, the valid obligations of the Partnership, and to make this Ninth Supplemental
Indenture a valid agreement of the Partnership enforceable in accordance with its terms.
NOW, THEREFORE, the Partnership and the Trustee hereby agree that the following provisions
shall supplement the Base Indenture:
ARTICLE I
DEFINITIONS
SECTION 1.1
Generally
.
(a) Capitalized terms used herein and not otherwise defined herein shall have the respective
meanings ascribed thereto in the Base Indenture.
(b) The rules of interpretation set forth in the Base Indenture shall be applied hereto as if
set forth in full herein.
1
SECTION 1.2
Definition of Certain Terms
.
For all purposes of this Ninth Supplemental Indenture, except as otherwise expressly provided
or unless the context otherwise requires, the following terms shall have the following respective
meanings:
Attributable Indebtedness, when used with respect to any Sale-Leaseback Transaction (as
defined in Section 5.2 hereof), means, as at the time of determination, the present value
(discounted at the rate set forth or implicit in the terms of the lease included in such
transaction) of the total obligations of the lessee for rental payments (other than amounts
required to be paid on account of property taxes, maintenance, repairs, insurance, assessments,
utilities, operating and labor costs and other items that do not constitute payments for property
rights) during the remaining term of the lease included in such Sale-Leaseback Transaction
(including any period for which such lease has been extended). In the case of any lease that is
terminable by the lessee upon the payment of a penalty or other termination payment, such amount
shall be the lesser of the amount determined assuming termination upon the first date such lease
may be terminated (in which case the amount shall also include the amount of the penalty or
termination payment, but no rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated) or the amount determined assuming
no such termination.
Comparable Treasury Issue means the United States Treasury security selected by the
Independent Investment Banker as having a maturity comparable to the remaining term of the Notes to
be redeemed that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of comparable maturity to
the remaining term of the Notes to be redeemed;
provided, however
, that if no maturity is within
three months before or after the maturity date for such Notes, yields for the two published
maturities most closely corresponding to such United States Treasury security will be determined
and the treasury rate will be interpolated or extrapolated from those yields on a straight line
basis rounding to the nearest month.
Comparable Treasury Price means, with respect to any Redemption Date, (a) the average of the
Reference Treasury Dealer Quotations for the Redemption Date, after excluding the highest and
lowest Reference Treasury Dealer Quotations, or (b) if the Independent Investment Banker obtains
fewer than four Reference Treasury Dealer Quotations, the average of all such quotations.
Consolidated Net Tangible Assets means, at any date of determination, the total amount of
assets of the Partnership and its consolidated Subsidiaries after deducting therefrom:
(1) all current liabilities (excluding (A) any current liabilities that by their terms are
extendable or renewable at the option of the obligor thereon to a time more than twelve months
after the time as of which the amount thereof is being computed, and (B) current maturities of
long-term debt); and
(2) the value (net of any applicable reserves) of all goodwill, trade names, trademarks,
patents and other like intangible assets,
2
all as set forth, or on a pro forma basis would be set forth, on the consolidated balance sheet of
the Partnership and its consolidated Subsidiaries for the Partnerships most recently completed
fiscal quarter for which financial statements have been filed with the SEC, prepared in accordance
with generally accepted accounting principles.
Credit Agreement means the Amended and Restated Credit Agreement, dated as of July 20, 2007,
among the Partnership, Wachovia Bank, National Association, as Administrative Agent, and the other
agents and lenders party thereto and as further amended, restated, refinanced, replaced or refunded
from time to time.
Indebtedness of any Person at any date means any obligation created or assumed by such
Person for the repayment of borrowed money or any guaranty thereof.
Independent Investment Banker means RBS Securities Inc., Credit Suisse Securities (USA) LLC,
SunTrust Robinson Humphrey, Inc., BNP Paribas Securities Corp. or Deutsche Bank Securities, Inc.
(and their respective successors) or, if any such firm is not willing and able to select the
applicable Comparable Treasury Issue, an independent investment banking institution of national
standing appointed by the Trustee and reasonably acceptable to the Partnership.
Permitted Liens means:
(1) liens upon rights-of-way for pipeline purposes;
(2) easements, rights-of-way, restrictions and other similar encumbrances incurred in the
ordinary course of business and encumbrances consisting of zoning restrictions, easements,
licenses, restrictions on the use of real property or minor imperfections in title thereto and
which do not in the aggregate materially adversely affect the value of the properties encumbered
thereby or materially impair their use in the operation of the business of the Partnership and its
Subsidiaries;
(3) rights reserved to or vested by any provision of law in any municipality or public
authority to control or regulate any of the properties of the Partnership or any Subsidiary or the
use thereof or the rights and interests of the Partnership or any Subsidiary therein, in any manner
under any and all laws;
(4) rights reserved to the grantors of any properties of the Partnership or any Subsidiary,
and the restrictions, conditions, restrictive covenants and limitations, in respect thereto,
pursuant to the terms, conditions and provisions of any rights-of-way agreements, contracts or
other agreements therewith;
(5) any statutory or governmental lien or lien arising by operation of law, or any mechanics,
repairmens, materialmens, suppliers, carriers, landlords, warehousemens or similar lien
incurred in the ordinary course of business which is not more than sixty (60) days past due or
which is being contested in good faith by appropriate proceedings and any undetermined lien which
is incidental to construction, development, improvement or repair;
3
(6) any right reserved to, or vested in, any municipality or public authority by the terms of
any right, power, franchise, grant, license, permit or by any provision of law, to purchase or
recapture or to designate a purchaser of, any property;
(7) liens for taxes and assessments which are (a) for the then current year, (b) not at the
time delinquent, or (c) delinquent but the validity or amount of which is being contested at the
time by the Partnership or any of its Subsidiaries in good faith by appropriate proceedings;
(8) liens of, or to secure performance of, leases, other than capital leases;
(9) any lien in favor of the Partnership or any Subsidiary;
(10) any lien upon any property or assets of the Partnership or any Subsidiary in existence on
the date of the initial issuance of the Notes;
(11) any lien incurred in the ordinary course of business in connection with workmens
compensation, unemployment insurance, temporary disability, social security, retiree health or
similar laws or regulations or to secure obligations imposed by statute or governmental
regulations;
(12) liens in favor of any Person to secure obligations under provisions of any letters of
credit, bank guarantees, bonds or surety obligations required or requested by any governmental
authority in connection with any contract or statute, provided that such obligations do not
constitute Indebtedness; or any lien upon or deposits of any assets to secure performance of bids,
trade contracts, leases or statutory obligations, and other obligations of a like nature incurred
in the ordinary course of business;
(13) any lien upon any property or assets created at the time of acquisition of such property
or assets by the Partnership or any of its Subsidiaries or within one year after such time to
secure all or a portion of the purchase price for such property or assets or debt incurred to
finance such purchase price, whether such debt was incurred prior to, at the time of or within one
year after the date of such acquisition;
(14) any lien upon any property or assets to secure all or part of the cost of construction,
development, repair or improvements thereon or to secure Indebtedness incurred prior to, at the
time of, or within one year after completion of such construction, development, repair or
improvements or the commencement of full operations thereof (whichever is later), to provide funds
for any such purpose;
(15) any lien upon any property or assets existing thereon at the time of the acquisition
thereof by the Partnership or any of its Subsidiaries and any lien upon any property or assets of a
Person existing thereon at the time such Person becomes a Subsidiary of the Partnership by
acquisition, merger or otherwise;
provided
that, in each case, such lien only encumbers the
property or assets so acquired or owned by such Person at the time such Person becomes a
Subsidiary;
(16) liens imposed by law or order as a result of any proceeding before any court or
regulatory body that is being contested in good faith, and liens which secure a judgment or other
4
court-ordered award or settlement as to which the Partnership or the applicable Subsidiary has
not exhausted its appellate rights;
(17) any extension, renewal, refinancing, refunding or replacement (or successive extensions,
renewals, refinancing, refunding or replacements) of liens, in whole or in part, referred to in
clauses (1) through (16) above;
provided, however
, that any such extension, renewal, refinancing,
refunding or replacement lien shall be limited to the property or assets covered by the lien
extended, renewed, refinanced, refunded or replaced and that the obligations secured by any such
extension, renewal, refinancing, refunding or replacement lien shall be in an amount not greater
than the amount of the obligations secured by the lien extended, renewed, refinanced, refunded or
replaced and any expenses of the Partnership or its Subsidiaries (including any premium) incurred
in connection with such extension, renewal, refinancing, refunding or replacement; or
(18) any lien resulting from the deposit of moneys or evidence of indebtedness in trust for
the purpose of defeasing Indebtedness of the Partnership or any of its Subsidiaries.
Principal Property means, whether owned or leased on the date hereof or thereafter acquired:
(1) any pipeline assets of the Partnership or any of its Subsidiaries, including any related
facilities employed in the gathering, transportation, distribution, storage or marketing of natural
gas, refined petroleum products, natural gas liquids and petrochemicals, that are located in the
United States of America or any territory or political subdivision thereof; and
(2) any processing, compression, treating, blending or manufacturing plant or terminal owned
or leased by the Partnership or any of its Subsidiaries that is located in the United States or any
territory or political subdivision thereof, except in the case of either of the preceding clauses
(1) or (2):
(a) any such assets consisting of inventories, furniture, office fixtures and equipment
(including data processing equipment), vehicles and equipment used on, or useful with,
vehicles;
(b) any such assets which, in the opinion of the board of directors of the General
Partner are not material in relation to the activities of the Partnership and its
Subsidiaries taken as a whole; and
(c) any assets used primarily in the conduct of the retail propane marketing business
conducted by Heritage Operating, L.P. and its Subsidiaries.
Reference Treasury Dealer means (a) each of RBS Securities Inc., Credit Suisse Securities
(USA) LLC, BNP Paribas Securities Corp., and Deutsche Bank Securities, Inc. and their respective
successors, (b) one primary U.S. government securities dealer in the United States selected by
SunTrust Robinson Humphrey, Inc., and its successor, and (c) one other primary U.S. government
securities dealer in the United States selected by the Partnership (each, a Primary Treasury
Dealer);
provided, however
, that if any of the foregoing shall resign as a
5
Reference Treasury Dealer or cease to be a U.S. government securities dealer, the Partnership
will substitute therefor another Primary Treasury Dealer.
Reference Treasury Dealer Quotations means, with respect to each Reference Treasury Dealer
and any Redemption Date for the Notes, an average, as determined by the Independent Investment
Banker, of the bid and asked prices for the Comparable Treasury Issue for the Notes to be redeemed
(expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee
by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day
preceding such Redemption Date.
Restricted Subsidiary means any Subsidiary owning or leasing, directly or indirectly through
ownership in another Subsidiary, any Principal Property.
Subsidiary Guarantor means, with respect to the Notes and notwithstanding the definition
thereof in the Base Indenture, each Subsidiary of the Partnership that guarantees the Notes
pursuant to the terms of the Indenture, but only so long as such Subsidiary is a guarantor of the
Notes on the terms provided in the Indenture.
Treasury Yield means, with respect to any Redemption Date applicable to the Notes, (a) the
yield, under the heading which represents the average for the immediately preceding week, appearing
in the most recently published statistical release designated H.15(519) or any successor
publication which is published weekly by the Board of Governors of the Federal Reserve System and
which establishes yields on actively traded United States Treasury securities adjusted to constant
maturity under the caption Treasury Constant Maturities, for the maturity corresponding to the
Comparable Treasury Issue; or (b) if the release (or any successor release) is not published during
the week preceding the calculation date or does not contain these yields, the rate per annum equal
to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately
preceding such Redemption Date) of the Comparable Treasury Issue, assuming a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
applicable Comparable Treasury Price for such Redemption Date.
ARTICLE II
GENERAL TERMS OF THE NOTES
SECTION 2.1
Form
.
The 2021 Notes and the 2041 Notes and the Trustees certificates of authentication shall be
substantially in the form of Exhibit A-1 and Exhibit A-2, respectively, to this Ninth Supplemental
Indenture, which are hereby incorporated into this Ninth Supplemental Indenture. The terms and
provisions contained in the Notes shall constitute, and are hereby expressly made, a part of this
Ninth Supplemental Indenture and to the extent applicable, the Partnership and the Trustee, by
their execution and delivery of this Ninth Supplemental Indenture, expressly agree to such terms
and provisions and to be bound thereby.
Each series of Notes shall be issued upon original issuance in whole in the form of one or
more Global Securities (the Book-Entry Notes). Each Book-Entry Note shall represent such of the
outstanding Notes as shall be specified therein and shall provide that it shall represent the
aggregate amount of outstanding Notes from time to time endorsed thereon and that the
6
aggregate amount of outstanding Notes represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges and redemptions.
The Partnership initially appoints The Depository Trust Company to act as Depositary with
respect to the Book-Entry Notes.
SECTION 2.2
Title, Amount and Payment of Principal and Interest.
(a) The 2021 Notes shall be entitled the 4.65% Senior Notes due 2021. The Trustee shall
authenticate and deliver (i) the 2021 Notes for original issue on the date hereof (the Original
2021 Notes) in the aggregate principal amount of $800,000,000, and (ii) additional 2021 Notes for
original issue from time to time after the date hereof in such principal amounts as may be
specified in a Partnership Order described in this sentence, in each case upon a Partnership Order
for the authentication and delivery thereof and satisfaction of the other provisions of Section
2.04 of the Base Indenture. Such order shall specify the amount of the 2021 Notes to be
authenticated, the date on which the original issue of 2021 Notes is to be authenticated, and the
name or names of the initial Holder or Holders. The aggregate principal amount of 2021 Notes that
may be outstanding at any time may not exceed $800,000,000 plus such additional principal amounts
as may be issued and authenticated pursuant to clause (ii) of this paragraph (except as provided in
Section 2.09 of the Indenture). The Original 2021 Notes and any additional 2021 Notes issued and
authenticated pursuant to clause (ii) of this paragraph shall constitute a single series of Debt
Securities for all purposes under the Indenture.
The principal amount of each 2021 Note shall be payable on June 1, 2021. Each 2021 Note shall
bear interest from the date of original issuance, or the most recent date to which interest has
been paid, at the fixed rate of 4.65% per annum. The dates on which interest on the 2021 Notes
shall be payable shall be June 1 and December 1 of each year, commencing December 1, 2011 (the
2021 Interest Payment Dates). The regular record date for interest payable on the 2021 Notes on
any 2021 Interest Payment Date shall be May 15 or November 15, as the case may be, next preceding
such 2021 Interest Payment Date.
Payments of principal of, premium, if any, and interest due on the 2021 Notes representing
Book-Entry Notes on any 2021 Interest Payment Date or at maturity will be made available to the
Trustee by 10:00 a.m., New York City time, on such date, unless such date falls on a day which is
not a Business Day, in which case such payments will be made available to the Trustee by 10:00
a.m., New York City time, on the next Business Day. As soon as possible thereafter, the Trustee
will make such payments to the Depositary.
(b) The 2041 Notes shall be entitled the 6.05% Senior Notes due 2041. The Trustee shall
authenticate and deliver (i) the 2041 Notes for original issue on the date hereof (the Original
2041 Notes) in the aggregate principal amount of $700,000,000, and (ii) additional 2041 Notes for
original issue from time to time after the date hereof in such principal amounts as may be
specified in a Partnership Order described in this sentence, in each case upon a Partnership Order
for the authentication and delivery thereof and satisfaction of the other provisions of Section
2.04 of the Base Indenture. Such order shall specify the amount of the 2041 Notes to be
authenticated, the date on which the original issue of 2041 Notes is to be authenticated, and the
name or names of the initial Holder or Holders. The aggregate principal
7
amount of 2041 Notes that may be outstanding at any time may not exceed $700,000,000 plus such
additional principal amounts as may be issued and authenticated pursuant to clause (ii) of this
paragraph (except as provided in Section 2.09 of the Indenture). The Original 2041 Notes and any
additional 2041 Notes issued and authenticated pursuant to clause (ii) of this paragraph shall
constitute a single series of Debt Securities for all purposes under the Indenture.
The principal amount of each 2041 Note shall be payable on June 1, 2041. Each 2041 Note shall
bear interest from the date of original issuance, or the most recent date to which interest has
been paid, at the fixed rate of 6.05% per annum. The dates on which interest on the 2021 Notes
shall be payable shall be June 1 and December 1 of each year, commencing December 1, 2011 (the
2041 Interest Payment Dates). The regular record date for interest payable on the 2041 Notes on
any 2041 Interest Payment Date shall be May 15 or November 15, as the case may be, next preceding
such 2041 Interest Payment Date.
Payments of principal of, premium, if any, and interest due on the 2041 Notes representing
Book-Entry Notes on any 2041 Interest Payment Date or at maturity will be made available to the
Trustee by 10:00 a.m., New York City time, on such date, unless such date falls on a day which is
not a Business Day, in which case such payments will be made available to the Trustee by 10:00
a.m., New York City time, on the next Business Day. As soon as possible thereafter, the Trustee
will make such payments to the Depositary.
SECTION 2.3
Transfer and Exchange
.
The transfer and exchange of Book-Entry Notes or beneficial interests therein shall be
effected through the Depositary, in accordance with Section 2.17 of the Base Indenture and Article
II of this Ninth Supplemental Indenture (including the restrictions on transfer set forth therein
and herein) and the rules and procedures of the Depositary therefor, which shall include
restrictions on transfer comparable to those set forth therein and herein to the extent required by
the Securities Act of 1933, as amended.
ARTICLE III
FUTURE SUBSIDIARY GUARANTEES
SECTION 3.1
No Initial Guarantee of the Notes by Subsidiary Guarantors
.
The Notes initially shall not be entitled to the benefits of the Guarantee contemplated by
Article X of the Base Indenture.
SECTION 3.2
Future Subsidiary Guarantors
.
If any Subsidiary of the Partnership that is not then a Subsidiary Guarantor guarantees,
becomes a co-obligor with respect to or otherwise provides direct credit support for any
obligations of the Partnership or any of its other Subsidiaries under the Credit Agreement, then
the Partnership shall cause such Subsidiary to promptly execute and deliver to the Trustee a
supplemental indenture to the Indenture, in a form satisfactory to the Trustee, providing for the
Guarantee by such Subsidiary of the Partnerships obligations under the Notes in accordance with
Article X of the Base Indenture.
8
SECTION 3.3
Release of Guarantees
.
In addition to the provisions of Section 10.04(a) of the Base Indenture, the Guarantee of the
Notes of any Subsidiary Guarantor shall be unconditionally released and discharged, following
delivery of written notice by the Partnership to the Trustee, upon the release and discharge of all
guarantees or other obligations of such Subsidiary Guarantor with respect to the obligations of the
Partnership or its Subsidiaries under the Credit Agreement.
SECTION 3.4
Reinstatement of Guarantees
.
If at any time following any release of the Guarantee of a Subsidiary Guarantor pursuant to
Section 3.3 above, such Subsidiary Guarantor again guarantees, becomes a co-obligor with respect to
or otherwise provides direct credit support for any obligations of the Partnership or any of its
Subsidiaries under the Credit Agreement, then such Subsidiary Guarantor shall again guarantee the
Partnerships obligations under the Notes and the Partnership shall cause such Subsidiary Guarantor
to promptly execute and deliver a supplemental indenture to the Indenture, in a form satisfactory
to the Trustee, providing for the Guarantee by such Subsidiary Guarantor of the Partnerships
obligations under the Notes in accordance with Article X of the Base Indenture.
ARTICLE IV
REDEMPTION
SECTION 4.1
Redemption
.
(a) Prior to March 1, 2021, the 2021 Notes are redeemable, at the option of the Partnership,
at any time in whole, or from time to time in part, at a Redemption Price equal to the greater of:
(i) 100% of the principal amount of the 2021 Notes to be redeemed; or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest (at the rate in effect on the
date of calculation of the Redemption Price) on the 2021 Notes to be redeemed that would be due
after the related Redemption Date but for such redemption (exclusive of interest accrued to the
Redemption Date) discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the applicable Treasury Yield plus 25 basis points; plus, in
either case, accrued interest to the Redemption Date.
At any time on or after March 1, 2021, the 2021 Notes are redeemable, at the option of the
Partnership, in whole or in part, at a Redemption Price equal to 100% of the principal amount of
the 2021 Notes to be redeemed plus accrued interest to the Redemption Date.
(b) Prior to December 1, 2040, the 2041 Notes are redeemable, at the option of the
Partnership, at any time in whole, or from time to time in part, at a Redemption Price equal to the
greater of: (i) 100% of the principal amount of the 2041 Notes to be redeemed; or (ii) the sum of
the present values of the remaining scheduled payments of principal and interest (at the rate in
effect on the date of calculation of the Redemption Price) on the 2041 Notes to be redeemed that
would be due after the related Redemption Date but for such redemption (exclusive of interest
accrued to the Redemption Date) discounted to the Redemption Date on a semi-annual basis (assuming
a 360-day year consisting of twelve 30-day months) at the applicable Treasury Yield plus 25 basis
points; plus, in either case, accrued interest to the Redemption Date.
9
At any time on or after December 1, 2040, the 2041 Notes are redeemable, at the option of the
Partnership, in whole or in part, at a Redemption Price equal to 100% of the principal amount of
the 2041 Notes to be redeemed plus accrued interest to the Redemption Date.
(c) The actual Redemption Price, determined as provided in Sections 4.1(a) and 4.1(b), shall
be calculated and certified to the Trustee and the Partnership by the Independent Investment
Banker.
(d) The Partnership shall have no obligation to redeem, purchase or repay the Notes pursuant
to any mandatory redemption, sinking fund or analogous provisions or at the option of a Holder
thereof.
ARTICLE V
ADDITIONAL COVENANTS
In addition to the covenants set forth in the Base Indenture, the Notes shall be entitled to
the benefit of the following covenants:
SECTION 5.1
Limitation on Liens
.
The Partnership shall not, nor shall it permit any of its Subsidiaries to, create, assume,
incur or suffer to exist any mortgage, lien, security interest, pledge, charge or other encumbrance
(liens) upon any Principal Property or upon any capital stock of any Restricted Subsidiary,
whether owned on the date hereof or thereafter acquired, to secure any Indebtedness of the
Partnership or any other Person (other than the Notes), without in any such case making effective
provisions whereby all of the outstanding Notes are secured equally and ratably with, or prior to,
such Indebtedness so long as such Indebtedness is so secured.
Notwithstanding the foregoing, the Partnership may, and may permit any of its Subsidiaries to,
create, assume, incur, or suffer to exist without securing the Notes (a) any Permitted Lien, (b)
any lien upon any Principal Property or capital stock of a Restricted Subsidiary to secure
Indebtedness of the Partnership or any other Person, provided that the aggregate principal amount
of all Indebtedness then outstanding secured by such lien and all similar liens under this clause
(b), together with all Attributable Indebtedness from Sale-Leaseback Transactions (excluding
Sale-Leaseback Transactions permitted by clauses (1) through (4), inclusive, of Section 5.2
hereof), does not exceed 10% of Consolidated Net Tangible Assets or (c) any lien upon (i) any
Principal Property that was not owned by the Partnership or any of its Subsidiaries on the date
hereof or (ii) the capital stock of any Restricted Subsidiary that owns no Principal Property that
was owned by the Partnership or any of its Subsidiaries on the date hereof, in each case owned by a
Subsidiary of the Partnership (an Excluded Subsidiary) that (A) is not, and is not required to
be, a Subsidiary Guarantor and (B) has not granted any liens on any of its property securing
Indebtedness with recourse to the Partnership or any Subsidiary of the Partnership other than such
Excluded Subsidiary or any other Excluded Subsidiary.
10
SECTION 5.2
Restriction on Sale-Leasebacks
.
The Partnership will not, and will not permit any Subsidiary to, engage in the sale or
transfer by the Partnership or any of its Subsidiaries of any Principal Property to a Person (other
than the Partnership or a Subsidiary) and the taking back by the Partnership or its Subsidiary, as
the case may be, of a lease of such Principal Property (a Sale-Leaseback Transaction), unless:
(1) such Sale-Leaseback Transaction occurs within one year from the date of completion of the
acquisition of the Principal Property subject thereto or the date of the completion of
construction, development or substantial repair or improvement, or commencement of full operations
on such Principal Property, whichever is later;
(2) the Sale-Leaseback Transaction involves a lease for a period, including renewals, of not
more than three years;
(3) the Partnership or such Subsidiary would be entitled to incur Indebtedness secured by a
lien on the Principal Property subject thereto in a principal amount equal to or exceeding the
Attributable Indebtedness from such Sale-Leaseback Transaction without equally and ratably securing
the Notes; or
(4) the Partnership or such Subsidiary, within a one-year period after such Sale-Leaseback
Transaction, applies or causes to be applied an amount not less than the Attributable Indebtedness
from such Sale-Leaseback Transaction to (a) the prepayment, repayment, redemption, reduction or
retirement of any Indebtedness of the Partnership or any of its Subsidiaries that is not
subordinated to the Notes or any Guarantee, or (b) the expenditure or expenditures for Principal
Property used or to be used in the ordinary course of business of Partnership or its Subsidiaries.
Notwithstanding the foregoing, the Partnership may, and may permit any Subsidiary to, effect
any Sale-Leaseback Transaction that is not excepted by clauses (1) through (4), inclusive, of the
preceding paragraph provided that the Attributable Indebtedness from such Sale-Leaseback
Transaction, together with the aggregate principal amount of outstanding Indebtedness (other than
the Notes) secured by liens other than Permitted Liens upon Principal Properties, does not exceed
10% of Consolidated Net Tangible Assets.
ARTICLE VI
ADDITIONAL EVENT OF DEFAULT
SECTION 6.1
Additional Event of Default
.
In addition to the Events of Default specified in Section 6.01 of the Base Indenture, the
following shall be an Event of Default with respect to each series of the Notes: any Indebtedness
of the Partnership or any Subsidiary Guarantor is not paid within any applicable grace period after
final maturity or is accelerated by the holders thereof because of a default and the total amount
of such Indebtedness unpaid or accelerated exceeds $25,000,000.
11
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1
Ratification of Base Indenture
.
The Base Indenture, as supplemented by this Ninth Supplemental Indenture, is in all respects
ratified and confirmed, and this Ninth Supplemental Indenture shall be deemed part of the Base
Indenture in the manner and to the extent herein and therein provided.
SECTION 7.2
Trustee Not Responsible for Recitals
.
The recitals contained herein and in the Notes, except with respect to the Trustees
certificates of authentication, shall be taken as the statements of the Partnership, and the
Trustee assumes no responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Ninth Supplemental Indenture or of the
Notes.
SECTION 7.3
Table of Contents, Headings, etc
.
The table of contents and headings of the Articles and Sections of this Ninth Supplemental
Indenture have been inserted for convenience of reference only, are not to be considered a part
hereof and shall in no way modify or restrict any of the terms or provisions hereof.
SECTION 7.4
Counterpart Originals
.
The parties may sign any number of copies of this Ninth Supplemental Indenture. Each signed
copy shall be an original, but all of them together represent the same agreement.
SECTION 7.5
Governing Law
.
THIS NINTH SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(Signature Pages Follow)
12
IN WITNESS WHEREOF, the parties hereto have caused this Ninth Supplemental Indenture to be
duly executed as of the day and year first above written.
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ISSUER:
ENERGY TRANSFER PARTNERS, L.P.
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By:
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Energy Transfer Partners GP, L.P.,
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Its:
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General Partner
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By:
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Energy Transfer Partners, L.L.C.
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Its:
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General Partner
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By:
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/s/ Martin Salinas
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Name:
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Martin Salinas
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Title:
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Chief Financial Officer
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TRUSTEE:
U.S. BANK NATIONAL ASSOCIATION
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By:
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/s/ Steven A. Finklea
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Name:
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Steven A. Finklea
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Title:
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Vice President
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Signature Page of Ninth Supplemental Indenture
Exhibit A-1
FORM OF NOTE
[FACE OF SECURITY]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (DTC) (55 WATER STREET, NEW YORK, NEW YORK 10041) TO THE PARTNERSHIP OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]*
[TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSORS NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO HEREIN.]*
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No.
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$
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CUSIP: 29273RAN9
ISIN: US29273RAN98
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ENERGY
TRANSFER PARTNERS, L.P.
4.65% SENIOR NOTES DUE 2021
ENERGY TRANSFER PARTNERS, L.P., a Delaware limited partnership (the Partnership, which term
includes any successor under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Cede & Co.* or its registered assigns, the principal sum of ________ U.S.
dollars ($___________), [or such greater or lesser principal sum as is shown on the attached
Schedule of Increases and Decreases in Global Security]
*
, on June 1, 2021 in such
coin and currency of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts, and to pay interest thereon at an annual rate of 4.65%
payable on June 1 and December 1 of each year, to the person in whose name the Security is
registered at the close of business on the record date for such interest, which shall be the
preceding May 15 or November 15 (each, a Regular Record Date), respectively, payable commencing
on December 1, 2011, with interest accruing from May 12, 2011, or the most recent date to which
interest shall have been paid.
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*
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To be included in a Book Entry Note.
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A-1-1
Reference is made to the further provisions of this Security set forth on the reverse hereof.
Such further provisions shall for all purposes have the same effect as though fully set forth at
this place.
The statements in the legends set forth in this Security are an integral part of the terms of
this Security and by acceptance hereof the Holder of this Security agrees to be subject to, and
bound by, the terms and provisions set forth in each such legend.
This Security is issued in respect of a series of Debt Securities of an initial aggregate
principal amount of $800,000,000 designated as the 4.65% Senior Notes due 2021 of the Partnership
and is governed by the Indenture dated as of January 18, 2005 (the Base Indenture), duly executed
and delivered by the Partnership, as issuer, to Wachovia Bank, National Association, as trustee, as
supplemented by the Ninth Supplemental Indenture dated as of May 12, 2011, duly executed by the
Partnership and U.S. Bank National Association (the Trustee), as successor to Wachovia Bank,
National Association, (the Ninth Supplemental Indenture, and together with the Base Indenture,
the Indenture). The terms of the Indenture are incorporated herein by reference. This Security
shall in all respects be entitled to the same benefits as definitive Debt Securities under the
Indenture.
If and to the extent any provision of the Indenture limits, qualifies or conflicts with any
other provision of the Indenture that is required to be included in the Indenture or is deemed
applicable to the Indenture by virtue of the provisions of the Trust Indenture Act of 1939, as
amended (the TIA), such required provision shall control.
This Security shall not be valid or become obligatory for any purpose until the Trustees
Certificate of Authentication hereon shall have been manually signed by the Trustee under the
Indenture.
A-1-2
IN WITNESS WHEREOF, the Partnership has caused this instrument to be duly executed by its sole
General Partner.
Dated:
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ENERGY TRANSFER PARTNERS, L.P.
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By:
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Energy Transfer Partners GP, L.P.
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Its:
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General Partner
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By:
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Energy Transfer Partners, L.L.C.
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Its:
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General Partner
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By:
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Name:
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Title:
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By:
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Name:
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Title:
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TRUSTEES CERTIFICATE OF AUTHENTICATION:
This is one of the Debt Securities of the series designated therein referred to in the
within-mentioned Indenture.
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U.S. BANK NATIONAL ASSOCIATION,
as Trustee
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By:
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Authorized Signatory
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A-1-3
[REVERSE OF SECURITY]
ENERGY TRANSFER PARTNERS, L.P.
4.65% SENIOR NOTES DUE 2021
This Security is one of a duly authorized issue of debentures, notes or other evidences of
indebtedness of the Partnership (the Debt Securities) of the series hereinafter specified, all
issued or to be issued under and pursuant to the Indenture, to which Indenture reference is hereby
made for a description of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Partnership and the Holders of the Debt Securities. The Debt
Securities may be issued in one or more series, which different series may be issued in various
aggregate principal amounts, may mature at different times, may bear interest (if any) at different
rates, may be subject to different sinking, purchase or analogous funds (if any) and may otherwise
vary as provided in the Indenture. This Security is one of a series designated as the 4.65% Senior
Notes due 2021 of the Partnership, in an initial aggregate principal amount of $800,000,000 (the
Securities).
1.
Interest
.
The Partnership promises to pay interest on the principal amount of this Security at the rate
of 4.65% per annum.
The Partnership will pay interest semi-annually on June 1 and December 1 of each year (each an
Interest Payment Date), commencing December 1, 2011. Interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no interest has been paid on the
Securities, from May 12, 2011. Interest will be computed on the basis of a 360-day year consisting
of twelve 30-day months. The Partnership shall pay interest (including post-petition interest in
any proceeding under any applicable bankruptcy laws) on overdue installments of interest (without
regard to any applicable grace period) and on overdue principal and premium, if any, from time to
time on demand at the same rate per annum, in each case to the extent lawful.
2.
Method of Payment
.
The Partnership shall pay interest on the Securities (except Defaulted Interest) to the
persons who are the registered Holders at the close of business on the Regular Record Date
immediately preceding the Interest Payment Date. Any such interest not so punctually paid or duly
provided for (Defaulted Interest) may be paid to the persons who are registered Holders at the
close of business on a special record date for the payment of such Defaulted Interest, or in any
other lawful manner not inconsistent with the requirements of any securities exchange on which such
Securities may then be listed if such manner of payment shall be deemed practicable by the Trustee,
as more fully provided in the Indenture. The Partnership shall pay principal, premium, if any, and
interest in such coin or currency of the United States of America as at the time of payment shall
be legal tender for payment of public and private debts. Payments in respect of a Global Security
(including principal, premium, if any, and interest) will be made by wire transfer of immediately
available funds to the accounts specified by the Depositary. Payments in respect of Securities in
definitive form (including principal, premium, if any, and
interest) will be made at the office or agency of the Partnership maintained for such purpose
A-1-4
within The City of New York, which initially will be at the corporate trust office of the Trustee
located at 100 Wall Street, Suite 1600, New York, New York 10005, Mail Station: EX-NY-WALL, or, at
the option of the Partnership, payment of interest may be made by check mailed to the Holders on
the relevant record date at their addresses set forth in the register of Holders maintained by the
Registrar or at the option of the Holder, payment of interest on Securities in definitive form will
be made by wire transfer of immediately available funds to any account maintained in the United
States, provided such Holder has requested such method of payment and provided timely wire transfer
instructions to the Paying Agent. The Holder must surrender this Security to a Paying Agent to
collect payment of principal.
3.
Paying Agent and Registrar
.
Initially, U.S. Bank National Association will act as Paying Agent and Registrar. The
Partnership may change any Paying Agent or Registrar at any time upon notice to the Trustee and the
Holders. The Partnership may act as Paying Agent.
4.
Indenture
.
This Security is one of a duly authorized issue of Debt Securities of the Partnership issued
and to be issued in one or more series under the Indenture.
Capitalized terms herein are used as defined in the Indenture unless otherwise defined herein.
The terms of the Securities include those stated in the Base Indenture, those made part of the
Indenture by reference to the TIA, as in effect on the date of the Base Indenture, and those terms
stated in the Ninth Supplemental Indenture. The Securities are subject to all such terms, and
Holders of Securities are referred to the Base Indenture, the Ninth Supplemental Indenture and the
TIA for a statement of them. The Securities of this series are general unsecured obligations of the
Partnership limited to an initial aggregate principal amount of $800,000,000;
provided, however
,
that the authorized aggregate principal amount of such series may be increased from time to time as
provided in the Ninth Supplemental Indenture.
5.
Redemption
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Prior to March 1, 2021, the Securities are redeemable, at the option of the Partnership, at
any time in whole, or from time to time in part, at a Redemption Price equal to the greater of: (i)
100% of the principal amount of the Securities to be redeemed; or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest (at the rate in effect on the
date of calculation of the Redemption Price) on the Securities to be redeemed that would be due
after the related Redemption Date but for such redemption (exclusive of interest accrued to the
Redemption Date) discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the applicable Treasury Yield plus 25 basis points; plus, in
either case, accrued interest to the Redemption Date.
At any time on or after March 1, 2021, the Securities are redeemable, at the option of the
Partnership, in whole or in part, at a Redemption Price equal to 100% of the principal amount of
the Securities to be redeemed plus accrued interest to the Redemption Date.
The actual Redemption Price, calculated as provided above, shall be calculated and certified
to the Trustee and the Partnership by the Independent Investment Banker.
A-1-5
Except as set forth above, the Securities will not be redeemable prior to their Stated
Maturity and will not be entitled to the benefit of any sinking fund.
6.
Denominations; Transfer; Exchange
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The Securities are to be issued in registered form, without coupons, in denominations of
$2,000 and integral multiples of $1,000 in excess thereof. A Holder may register the transfer of,
or exchange, Securities in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture.
7.
Person Deemed Owners
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The registered Holder of a Security may be treated as the owner of it for all purposes.
8.
Amendment; Supplement; Waiver
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Subject to certain exceptions, the Indenture may be amended or supplemented, and any existing
Event of Default or compliance with any provision may be waived, with the consent of the Holders of
a majority in principal amount of the outstanding Debt Securities of each series affected. Without
consent of any Holder of a Security, the parties thereto may amend or supplement the Indenture to,
among other things, cure any ambiguity or omission, to correct any defect or inconsistency, or to
make any other change that does not adversely affect the rights of any Holder of a Security. Any
such consent or waiver by the Holder of this Security (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such Holder and upon all future Holders and owners of this
Security and any Securities which may be issued in exchange or substitution herefor, irrespective
of whether or not any notation thereof is made upon this Security or such other Securities.
9.
Defaults and Remedies
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Certain events of bankruptcy or insolvency are Events of Default that will result in the
principal amount of the Securities, together with premium, if any, and accrued and unpaid interest
thereon, becoming due and payable immediately upon the occurrence of such Events of Default. If any
other Event of Default with respect to the Securities occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in aggregate principal amount of the
Securities then outstanding may declare the principal amount of all the Securities, together with
premium, if any, and accrued and unpaid interest thereon, to be due and payable immediately in the
manner and with the effect provided in the Indenture. Notwithstanding the preceding sentence,
however, if at any time after such a declaration of acceleration has been made, the Holders of a
majority in principal amount of the outstanding Securities, by written notice to the Trustee, may
rescind such declaration and annul its consequences if the rescission would not conflict with any
judgment or decree of a court already rendered and if all Events of Default with respect to the
Securities, other than the nonpayment of the principal, premium, if any, or interest which has
become due solely by such declaration acceleration, shall have been
cured or shall have been waived. No such rescission shall affect any subsequent default or
shall impair any right consequent thereon. Holders of Securities may not enforce the Indenture or
the Securities except as provided in the Indenture. The Trustee may require indemnity or security
satisfactory to it before it enforces the Indenture or the Securities. Subject to certain
limitations,
A-1-6
Holders of a majority in aggregate principal amount of the Securities then outstanding
may direct the Trustee in its exercise of any trust or power.
10.
Trustee Dealings with Partnership
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The Trustee under the Indenture, in its individual or any other capacity, may make loans to,
accept deposits from, and perform services for the Partnership or its Affiliates, and may otherwise
deal with the Partnership or its Affiliates as if it were not the Trustee.
11.
Authentication
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This Security shall not be valid until the Trustee signs the certificate of authentication on
the other side of this Security.
12.
Abbreviations and Defined Terms
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Customary abbreviations may be used in the name of a Holder of a Security or an assignee, such
as: TEN COM (tenant in common), TEN ENT (tenants by the entireties), JT TEN (joint tenants with
right of survivorship and not as tenants in common), CUST (Custodian), and U/G/M/A (Uniform Gifts
to Minors Act).
13.
CUSIP Numbers
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Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Partnership has caused CUSIP numbers to be printed on the Securities as a
convenience to the Holders of the Securities. No representation is made as to the accuracy of such
number as printed on the Securities and reliance may be placed only on the other identification
numbers printed hereon.
14.
Absolute Obligation
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No reference herein to the Indenture and no provision of this Security or the Indenture shall
alter or impair the obligation of the Partnership, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Security in the manner, at the respective
times, at the rate and in the coin or currency herein prescribed.
15.
No Recourse
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No director, officer, employee, limited partner or shareholder, as such, of the Partnership or
the General Partner shall have any personal liability in respect of the obligations of the
Partnership under the Securities, the Indenture or any Guarantee by reason of his, her or its
status. Each Holder by accepting the Securities waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Securities.
16.
Governing Law
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This Security shall be construed in accordance with and governed by the laws of the State of
New York.
A-1-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this instrument, shall be
construed as though they were written out in full according to applicable laws or regulations:
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TEN COM as tenants in common
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UNIF GIFT MIN ACT
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(Cust.)
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TEN ENT as tenants by entireties
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Custodian for:
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(Minor)
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JT TEN as joint tenants with right
of survivorship and not as tenants in
common
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Under Uniform Gifts to Minors Act of
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(State)
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Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
Please print or type name and address including postal zip code of assignee:
the within Security and all rights thereunder, hereby irrevocably constituting and appointing to
transfer said Security on the books of the Partnership, with full power of substitution in the
premises.
A-1-8
SCHEDULE OF INCREASES OR DECREASES
IN GLOBAL SECURITY*
The following increases or decreases in this Global Security have been made:
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Amount of Decrease
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Amount of Increase
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Principal Amount of
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in Principal Amount
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in Principal Amount
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this Global Security
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Signature of
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of this Global
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of this Global
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following such
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authorized officer of
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Date of Exchange
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Security
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Security
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decrease (or increase)
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Trustee or Depositary
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To be included in a Book-Entry Note.
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A-1-9
Exhibit A-2
FORM OF NOTE
[FACE OF SECURITY]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (DTC) (55 WATER STREET, NEW YORK, NEW YORK 10041) TO THE PARTNERSHIP OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]*
[TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSORS NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO HEREIN.]*
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No. __________
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$__________
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CUSIP: 29273RAP4
ISIN: US29273RAP47
ENERGY TRANSFER PARTNERS, L.P.
6.05% SENIOR NOTES DUE 2041
ENERGY TRANSFER PARTNERS, L.P., a Delaware limited partnership (the Partnership, which term
includes any successor under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Cede & Co.* or its registered assigns, the principal sum of ________ U.S.
dollars ($___________), [or such greater or lesser principal sum as is shown on the attached
Schedule of Increases and Decreases in Global Security]
*
, on June 1, 2041 in such
coin and currency of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts, and to pay interest thereon at an annual rate of 6.05%
payable on June 1 and December 1 of each year, to the person in whose name the Security is
registered at the close of business on the record date for such interest, which shall be the
preceding May 15 or November 15 (each, a Regular Record Date), respectively, payable commencing
on December 1, 2011, with interest accruing from May 12, 2011, or the most recent date to which
interest shall have been paid.
Reference is made to the further provisions of this Security set forth on the reverse hereof.
Such further provisions shall for all purposes have the same effect as though fully set forth at
this place.
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To be included in Book Entry Note.
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A-2-1
The statements in the legends set forth in this Security are an integral part of the terms of
this Security and by acceptance hereof the Holder of this Security agrees to be subject to, and
bound by, the terms and provisions set forth in each such legend.
This Security is issued in respect of a series of Debt Securities of an initial aggregate
principal amount of $700,000,000 designated as the 6.05% Senior Notes due 2041 of the Partnership
and is governed by the Indenture dated as of January 18, 2005 (the Base Indenture), duly executed
and delivered by the Partnership, as issuer, to Wachovia Bank, National Association, as trustee, as
supplemented by the Ninth Supplemental Indenture dated as of May 12, 2011, duly executed by the
Partnership and U.S. Bank National Association (the Trustee), as successor to Wachovia Bank,
National Association, (the Ninth Supplemental Indenture, and together with the Base Indenture,
the Indenture). The terms of the Indenture are incorporated herein by reference. This Security
shall in all respects be entitled to the same benefits as definitive Debt Securities under the
Indenture.
If and to the extent any provision of the Indenture limits, qualifies or conflicts with any
other provision of the Indenture that is required to be included in the Indenture or is deemed
applicable to the Indenture by virtue of the provisions of the Trust Indenture Act of 1939, as
amended (the TIA), such required provision shall control.
This Security shall not be valid or become obligatory for any purpose until the Trustees
Certificate of Authentication hereon shall have been manually signed by the Trustee under the
Indenture.
A-2-2
IN WITNESS WHEREOF, the Partnership has caused this instrument to be duly executed by its sole
General Partner.
Dated:
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ENERGY TRANSFER PARTNERS, L.P.
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By:
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Energy Transfer Partners GP, L.P.
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Its: General Partner
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By:
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Energy Transfer Partners, L.L.C.
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Its: General Partner
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By:
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Name:
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Title:
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By:
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Name:
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Title:
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TRUSTEES CERTIFICATE OF AUTHENTICATION:
This is one of the Debt Securities of the series designated therein referred to in the
within-mentioned Indenture.
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U.S. BANK NATIONAL ASSOCIATION,
as Trustee
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By:
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Authorized Signatory
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A-2-3
[REVERSE OF SECURITY]
ENERGY TRANSFER PARTNERS, L.P.
6.05% SENIOR NOTES DUE 2041
This Security is one of a duly authorized issue of debentures, notes or other evidences of
indebtedness of the Partnership (the Debt Securities) of the series hereinafter specified, all
issued or to be issued under and pursuant to the Indenture, to which Indenture reference is hereby
made for a description of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Partnership and the Holders of the Debt Securities. The Debt
Securities may be issued in one or more series, which different series may be issued in various
aggregate principal amounts, may mature at different times, may bear interest (if any) at different
rates, may be subject to different sinking, purchase or analogous funds (if any) and may otherwise
vary as provided in the Indenture. This Security is one of a series designated as the 6.05% Senior
Notes due 2041 of the Partnership, in an initial aggregate principal amount of $700,000,000 (the
Securities).
1.
Interest
.
The Partnership promises to pay interest on the principal amount of this Security at the rate
of 6.05% per annum.
The Partnership will pay interest semi-annually on June 1 and December 1 of each year (each an
Interest Payment Date), commencing December 1, 2011. Interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no interest has been paid on the
Securities, from May 12, 2011. Interest will be computed on the basis of a 360-day year consisting
of twelve 30-day months. The Partnership shall pay interest (including post-petition interest in
any proceeding under any applicable bankruptcy laws) on overdue installments of interest (without
regard to any applicable grace period) and on overdue principal and premium, if any, from time to
time on demand at the same rate per annum, in each case to the extent lawful.
2.
Method of Payment
.
The Partnership shall pay interest on the Securities (except Defaulted Interest) to the
persons who are the registered Holders at the close of business on the Regular Record Date
immediately preceding the Interest Payment Date. Any such interest not so punctually paid or duly
provided for (Defaulted Interest) may be paid to the persons who are registered Holders at the
close of business on a special record date for the payment of such Defaulted Interest, or in any
other lawful manner not inconsistent with the requirements of any securities exchange on which such
Securities may then be listed if such manner of payment shall be deemed practicable by the Trustee,
as more fully provided in the Indenture. The Partnership shall pay principal, premium, if any, and
interest in such coin or currency of the United States of America as at the time of payment shall
be legal tender for payment of public and private debts. Payments in respect of a Global Security
(including principal, premium, if any, and interest) will be made by wire transfer of immediately
available funds to the accounts specified by the Depositary. Payments in respect of Securities in
definitive form (including principal, premium, if any, and interest) will be made at the office or
agency of the Partnership maintained for such purpose
A-2-4
within The City of New York, which initially will be at the corporate trust office of the Trustee
located at 100 Wall Street, Suite 1600, New York, New York 10005, Mail Station: EX-NY-WALL, or, at
the option of the Partnership, payment of interest may be made by check mailed to the Holders on
the relevant record date at their addresses set forth in the register of Holders maintained by the
Registrar or at the option of the Holder, payment of interest on Securities in definitive form will
be made by wire transfer of immediately available funds to any account maintained in the United
States, provided such Holder has requested such method of payment and provided timely wire transfer
instructions to the Paying Agent. The Holder must surrender this Security to a Paying Agent to
collect payment of principal.
3.
Paying Agent and Registrar
.
Initially, U.S. Bank National Association will act as Paying Agent and Registrar. The
Partnership may change any Paying Agent or Registrar at any time upon notice to the Trustee and the
Holders. The Partnership may act as Paying Agent.
4.
Indenture
.
This Security is one of a duly authorized issue of Debt Securities of the Partnership issued
and to be issued in one or more series under the Indenture.
Capitalized terms herein are used as defined in the Indenture unless otherwise defined herein.
The terms of the Securities include those stated in the Base Indenture, those made part of the
Indenture by reference to the TIA, as in effect on the date of the Base Indenture, and those terms
stated in the Ninth Supplemental Indenture. The Securities are subject to all such terms, and
Holders of Securities are referred to the Base Indenture, the Ninth Supplemental Indenture and the
TIA for a statement of them. The Securities of this series are general unsecured obligations of the
Partnership limited to an initial aggregate principal amount of $700,000,000;
provided, however
,
that the authorized aggregate principal amount of such series may be increased from time to time as
provided in the Ninth Supplemental Indenture.
5.
Redemption
.
Prior to December 1, 2040, the Securities are redeemable, at the option of the Partnership, at
any time in whole, or from time to time in part, at a Redemption Price equal to the greater of: (i)
100% of the principal amount of the Securities to be redeemed; or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest (at the rate in effect on the
date of calculation of the Redemption Price) on the Securities to be redeemed that would be due
after the related Redemption Date but for such redemption (exclusive of interest accrued to the
Redemption Date) discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the applicable Treasury Yield plus 25 basis points; plus, in
either case, accrued interest to the Redemption Date.
At any time on or after December 1, 2040, the Securities are redeemable, at the option of the
Partnership, in whole or in part, at a Redemption Price equal to 100% of the principal amount of
the Securities to be redeemed plus accrued interest to the Redemption Date.
The actual Redemption Price, calculated as provided above, shall be calculated and certified
to the Trustee and the Partnership by the Independent Investment Banker.
A-2-5
Except as set forth above, the Securities will not be redeemable prior to their Stated
Maturity and will not be entitled to the benefit of any sinking fund.
6.
Denominations; Transfer; Exchange
.
The Securities are to be issued in registered form, without coupons, in denominations of
$2,000 and integral multiples of $1,000 in excess thereof. A Holder may register the transfer of,
or exchange, Securities in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture.
7.
Person Deemed Owners
.
The registered Holder of a Security may be treated as the owner of it for all purposes.
8.
Amendment; Supplement; Waiver
.
Subject to certain exceptions, the Indenture may be amended or supplemented, and any existing
Event of Default or compliance with any provision may be waived, with the consent of the Holders of
a majority in principal amount of the outstanding Debt Securities of each series affected. Without
consent of any Holder of a Security, the parties thereto may amend or supplement the Indenture to,
among other things, cure any ambiguity or omission, to correct any defect or inconsistency, or to
make any other change that does not adversely affect the rights of any Holder of a Security. Any
such consent or waiver by the Holder of this Security (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such Holder and upon all future Holders and owners of this
Security and any Securities which may be issued in exchange or substitution herefor, irrespective
of whether or not any notation thereof is made upon this Security or such other Securities.
9.
Defaults and Remedies
.
Certain events of bankruptcy or insolvency are Events of Default that will result in the
principal amount of the Securities, together with premium, if any, and accrued and unpaid interest
thereon, becoming due and payable immediately upon the occurrence of such Events of Default. If any
other Event of Default with respect to the Securities occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in aggregate principal amount of the
Securities then outstanding may declare the principal amount of all the Securities, together with
premium, if any, and accrued and unpaid interest thereon, to be due and payable immediately in the
manner and with the effect provided in the Indenture. Notwithstanding the preceding sentence,
however, if at any time after such a declaration of acceleration has been made, the Holders of a
majority in principal amount of the outstanding Securities, by written notice to the Trustee, may
rescind such declaration and annul its consequences if the rescission would not conflict with any
judgment or decree of a court already rendered and if all Events of Default with respect to the
Securities, other than the nonpayment of the principal, premium, if any, or interest which has
become due solely by such declaration acceleration, shall have been cured or shall have been
waived. No such rescission shall affect any subsequent default or shall impair any right consequent
thereon. Holders of Securities may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee may require indemnity or security satisfactory to it before it
enforces the Indenture or the Securities. Subject to certain limitations,
A-2-6
Holders of a majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power.
10.
Trustee Dealings with Partnership
.
The Trustee under the Indenture, in its individual or any other capacity, may make loans to,
accept deposits from, and perform services for the Partnership or its Affiliates, and may otherwise
deal with the Partnership or its Affiliates as if it were not the Trustee.
11.
Authentication
.
This Security shall not be valid until the Trustee signs the certificate of authentication on
the other side of this Security.
12.
Abbreviations and Defined Terms
.
Customary abbreviations may be used in the name of a Holder of a Security or an assignee, such
as: TEN COM (tenant in common), TEN ENT (tenants by the entireties), JT TEN (joint tenants with
right of survivorship and not as tenants in common), CUST (Custodian), and U/G/M/A (Uniform Gifts
to Minors Act).
13.
CUSIP Numbers
.
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Partnership has caused CUSIP numbers to be printed on the Securities as a
convenience to the Holders of the Securities. No representation is made as to the accuracy of such
number as printed on the Securities and reliance may be placed only on the other identification
numbers printed hereon.
14.
Absolute Obligation
.
No reference herein to the Indenture and no provision of this Security or the Indenture shall
alter or impair the obligation of the Partnership, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Security in the manner, at the respective
times, at the rate and in the coin or currency herein prescribed.
15.
No Recourse
.
No director, officer, employee, limited partner or shareholder, as such, of the Partnership or
the General Partner shall have any personal liability in respect of the obligations of the
Partnership under the Securities, the Indenture or any Guarantee by reason of his, her or its
status. Each Holder by accepting the Securities waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Securities.
16.
Governing Law
.
This Security shall be construed in accordance with and governed by the laws of the State of
New York.
A-2-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this instrument, shall be
construed as though they were written out in full according to applicable laws or regulations:
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TEN COM as tenants in common
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UNIF GIFT MIN ACT
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(Cust.)
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TEN ENT as tenants by entireties
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Custodian for:
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(Minor)
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JT TEN as joint tenants with right
of survivorship and not as tenants in
common
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Under Uniform Gifts to Minors Act of
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(State)
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Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
Please print or type name and address including postal zip code of assignee:
the within Security and all rights thereunder, hereby irrevocably constituting and appointing to
transfer said Security on the books of the Partnership, with full power of substitution in the
premises.
A-2-8
SCHEDULE OF INCREASES OR DECREASES
IN GLOBAL SECURITY*
The following increases or decreases in this Global Security have been made:
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Amount of Decrease
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Amount of Increase
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Principal Amount of
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in Principal Amount
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in Principal Amount
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this Global Security
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Signature of
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of this Global
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of this Global
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following such
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authorized officer of
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Date of Exchange
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Security
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Security
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decrease (or increase)
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Trustee or Depositary
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*
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To be included in a Book-Entry Note.
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A-2-9
Exhibit 99.2
DESCRIPTION OF THE NOTES
Energy Transfer will issue the notes under an indenture dated as
of January 18, 2005 among itself, the subsidiaries of
Energy Transfer named therein and U.S. Bank National
Association (as
successor-by-merger
to Wachovia Bank, National Association), as trustee, as
supplemented by a supplemental indenture creating the notes (as
so supplemented, the indenture). This description is
a summary of the material provisions of the notes and the
indenture. This description does not restate those agreements
and instruments in their entirety. You should refer to the notes
and the indenture, forms of which are available as set forth
below under Where You Can Find More Information, for
a complete description of our obligations and your rights.
You can find the definitions of various terms used in this
description under Certain Definitions
below. In this description, the terms Energy
Transfer, we, us and
our refer only to Energy Transfer Partners, L.P. and
not to any of its Subsidiaries.
General
The notes:
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will be general unsecured, senior obligations of Energy
Transfer, ranking equally with all other existing and future
unsecured and unsubordinated indebtedness of Energy Transfer;
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will initially be issued in an aggregate principal amount of
$800,000,000 with respect to the 2021 notes and an aggregate
principal amount of $700,000,000 with respect to the 2041 notes;
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will mature on June 1, 2021, with respect to the 2021 notes
and June 1, 2041, with respect to the 2041 notes;
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will be issued in denominations of $2,000 and integral multiples
of $1,000 in excess thereof;
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will bear interest at an annual rate of 4.65% with respect to
the 2021 notes and an annual rate of 6.05% with respect to the
2041 notes; and
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will be redeemable at any time at our option at the redemption
price described below under Optional
Redemption.
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The 2021 notes and the 2041 notes each constitute a separate
series of debt securities under the indenture. The indenture
does not limit the amount of debt securities we may issue under
the indenture from time to time in one or more series.
Currently, we have outstanding under the indenture
$400 million aggregate principal amount of our
5.65% Senior Notes due 2012, $350 million aggregate
principal amount of our 6.00% Senior Notes due 2013,
$350 million aggregate principal amount of our
8.50% Senior Notes due 2014, $750 million aggregate
principal amount of our 5.95% Senior Notes due 2015,
$400 million aggregate principal amount of our
6.125% Senior Notes due 2017, $600 million aggregate
principal amount of our 6.70% Senior Notes due 2018,
$600 million aggregate principal amount of our
9.70% Senior Notes due 2019, $650 million aggregate
principal amount of our 9.00% Senior Notes due 2019,
$400 million aggregate principal amount of our
6.625% Senior Notes due 2036 and $550 million
aggregate principal amount of our 7.50% Senior Notes due
2038 (collectively, the existing senior notes). We
may in the future issue additional debt securities under the
indenture in addition to the notes.
Interest
Interest on the notes will accrue from and including
May 12, 2011 or from and including the most recent interest
payment date to which interest has been paid or provided for. We
will pay interest in cash semiannually in arrears on June 1
and December 1 of each year, beginning December 1,
2011. We will make interest payments to the persons in whose
names the notes are registered at the close of business on
May 15 or November 15, as applicable, before the next
interest payment date. Interest will be computed on the basis of
a
360-day
year consisting of twelve
30-day
months. If any interest payment date falls on a day that is not
a business day, the payment will be made on the next business
day, and no interest will accrue on the amount of interest due
on that interest payment date for the period from and after the
interest payment date to the date of payment.
S-19
Further
Issuances
We may from time to time, without notice to or the consent of
the holders of the notes, create and issue additional notes
having the same terms as either of the series of notes offered
by this prospectus supplement and accompanying prospectus,
except for the issue price and in some cases, the first interest
payment date. Additional notes issued in this manner will form a
single series with the previously issued and outstanding notes
of such series.
Optional
Redemption
Prior to the date that is three months prior to the
maturity of the 2021 notes, and six months prior to the maturity
of the 2041 notes, the respective notes will be redeemable, at
our option, at any time in whole, or from time to time in part,
at a price equal to the greater of:
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100% of the principal amount of the notes to be redeemed; or
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the sum of the present values of the remaining scheduled
payments of principal and interest (at the interest rate in
effect on the date of calculation of the redemption price) on
the notes to be redeemed that would be due after the related
redemption date but for such redemption (exclusive of interest
accrued to the redemption date) discounted to the redemption
date on a semi-annual basis (assuming a
360-day
year
consisting of twelve
30-day
months) at the applicable Treasury Yield plus 25 basis points,
with respect to the 2021 notes, and 25 basis points, with
respect to the 2041 notes;
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plus, in either case, accrued interest to the redemption date.
At any time on or after the date that is three months prior
to the maturity of the 2021 notes, and six months prior to the
maturity of the 2041 notes, the respective notes will be
redeemable in whole or in part, at our option, at a redemption
price equal to 100% of the principal amount of the notes to be
redeemed plus accrued interest thereon to the redemption date.
The actual redemption price, calculated as provided below, will
be calculated and certified to the trustee and us by the
Independent Investment Banker.
Notes called for redemption become due on the redemption date.
Notices of redemption will be mailed at least 30 but not more
than 60 days before the redemption date to each holder of
the notes to be redeemed at its registered address. The notice
of redemption for the notes will state, among other things, the
amount of notes to be redeemed, the redemption date, the method
of calculating the redemption price and each place that payment
will be made upon presentation and surrender of notes to be
redeemed. Unless we default in payment of the redemption price,
interest will cease to accrue on any notes that have been called
for redemption on the redemption date. If less than all of the
notes of a series are redeemed at any time, the trustee will
select the notes to be redeemed on a pro rata basis, by lot or
by any other method the trustee deems fair and appropriate.
For purposes of determining the redemption price, the following
definitions are applicable:
Treasury Yield
means, with respect to any
redemption date applicable to the notes, (a) the yield,
under the heading which represents the average for the
immediately preceding week, appearing in the most recently
published statistical release designated H.15(519)
or any successor publication which is published weekly by the
Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury
securities adjusted to constant maturity under the caption
Treasury Constant Maturities, for the maturity
corresponding to the Comparable Treasury Issue; or (b) if
the release (or any successor release) is not published during
the week preceding the calculation date or does not contain
these yields, the rate per annum equal to the semi-annual
equivalent yield to maturity (computed as of the third business
day immediately preceding such redemption date) of the
Comparable Treasury Issue, assuming a price for the Comparable
Treasury Issue (expressed as a percentage of its principal
amount) equal to the applicable Comparable Treasury Price for
such redemption date.
Comparable Treasury Issue
means the United
States Treasury security selected by the Independent Investment
Banker as having a maturity comparable to the remaining term of
the notes to be redeemed
S-20
that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to
the remaining term of the notes to be redeemed;
provided,
however,
that if no maturity is within three months before
or after the maturity date for such notes, yields for the two
published maturities most closely corresponding to such United
States Treasury security will be determined and the treasury
rate will be interpolated or extrapolated from those yields on a
straight line basis rounding to the nearest month.
Comparable Treasury Price
means, with respect
to any redemption date, (a) the average of the Reference
Treasury Dealer Quotations for the redemption date, after
excluding the highest and lowest Reference Treasury Dealer
Quotations, or (b) if the Independent Investment Banker
obtains fewer than four Reference Treasury Dealer Quotations,
the average of all such quotations.
Independent Investment Banker
means RBS
Securities Inc., Credit Suisse Securities (USA) LLC, SunTrust
Robinson Humphrey, Inc., BNP Paribas Securities Corp., and
Deutsche Bank Securities, Inc. (and their respective successors)
or, if any such firm is not willing and able to select the
applicable Comparable Treasury Issue, an independent investment
banking institution of national standing appointed by the
trustee and reasonably acceptable to Energy Transfer.
Reference Treasury Dealer
means (a) each
of RBS Securities Inc., Credit Suisse Securities (USA) LLC, BNP
Paribas Securities Corp., and Deutsche Bank Securities, Inc. and
their respective successors, (b) one primary U.S.
government securities dealer in the United States selected by
SunTrust Robinson Humphrey, Inc., and its successor, and
(c) one other primary U.S. government securities
dealer in the United States selected by Energy Transfer (each, a
Primary Treasury Dealer);
provided, however,
that if any of the foregoing shall resign as a Reference
Treasury Dealer or cease to be a U.S. government securities
dealer, Energy Transfer will substitute therefor another Primary
Treasury Dealer.
Reference Treasury Dealer Quotations
means,
with respect to each Reference Treasury Dealer and any
redemption date for the notes, an average, as determined by the
Independent Investment Banker, of the bid and asked prices for
the Comparable Treasury Issue for the notes to be redeemed
(expressed in each case as a percentage of its principal amount)
quoted in writing to the trustee by such Reference Treasury
Dealer at 5:00 p.m., New York City time, on the third
business day preceding such redemption date.
Subsidiary
Guarantees
The notes initially will not be guaranteed by any of our
Subsidiaries. However, if at any time following the issuance of
the notes, any Subsidiary of Energy Transfer guarantees, becomes
a co-obligor with respect to or otherwise provides direct credit
support for any obligations of Energy Transfer or any of its
other Subsidiaries under the Credit Agreement, then Energy
Transfer will cause such Subsidiary to promptly execute and
deliver to the trustee a supplemental indenture in a form
satisfactory to the trustee pursuant to which such Subsidiary
guarantees Energy Transfers obligations with respect to
the notes on the terms provided for in the indenture.
The guarantee of any Subsidiary Guarantor may be released under
certain circumstances. If we exercise our legal or covenant
defeasance option with respect to the notes as described below
under Defeasance and Discharge, then any
Subsidiary Guarantor will be released. Further, if no default
has occurred and is continuing under the indenture, and to the
extent not otherwise prohibited by the indenture, a Subsidiary
Guarantor will be unconditionally released and discharged from
its guarantee:
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automatically upon any sale, exchange or transfer, whether by
way of merger or otherwise, to any Person that is not our
affiliate, of all of our direct or indirect limited partnership
or other equity interests in the Subsidiary Guarantor;
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automatically upon the merger of the Subsidiary Guarantor into
us or any other Subsidiary Guarantor or the liquidation and
dissolution of the Subsidiary Guarantor; or
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following delivery of a written notice by us to the trustee,
upon the release of all guarantees or other obligations of the
Subsidiary Guarantor with respect to the obligations of Energy
Transfer or any of its Subsidiaries under the Credit Agreement.
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S-21
If at any time following any release of a Subsidiary Guarantor
from its guarantee of the notes pursuant to the third bullet
point in the preceding paragraph, the Subsidiary Guarantor again
guarantees, becomes a co-obligor with respect to or otherwise
provides direct credit support for any obligations of Energy
Transfer or any of its Subsidiaries under the Credit Agreement,
then Energy Transfer will cause the Subsidiary Guarantor to
again guarantee the notes in accordance with the indenture.
Ranking
The notes will be unsecured, unless we are required to secure
them pursuant to the limitations on liens covenant described
below under Certain Covenants
Limitations on Liens. The notes will also be the
unsubordinated obligations of Energy Transfer and will rank
equally with all other existing and future unsubordinated
indebtedness of Energy Transfer. Each guarantee, if any, of the
notes will be an unsecured and unsubordinated obligation of the
Subsidiary Guarantor and will rank equally with all other
existing and future unsubordinated indebtedness of the
Subsidiary Guarantor. The notes and each guarantee, if any, will
effectively rank junior to any future indebtedness of Energy
Transfer and any Subsidiary Guarantor that is both secured and
unsubordinated to the extent of the value of the assets securing
such indebtedness, and the notes will effectively rank junior to
all indebtedness and other liabilities of Energy Transfers
existing and future Subsidiaries that are not Subsidiary
Guarantors.
As of March 31, 2011, after giving effect to (i) this
offering and the use of net proceeds therefrom, (ii) our
public offering of 14,202,500 common units in March 2011 and the
use of net proceeds therefrom, and (iii) the funding with
borrowings under our Credit Agreement of our pro rata share of
the purchase price paid by Lone Star NGL LLC in connection with
its acquisition of the membership interests in LDH Energy Asset
Holdings LLC, Energy Transfer, excluding its Subsidiaries, would
have had approximately $6.5 billion of indebtedness, all of
which would have been unsecured, unsubordinated indebtedness
consisting entirely of the notes, the existing senior notes and
the obligations under the Credit Agreement. Initially, none of
Energy Transfers Subsidiaries will guarantee the notes.
Substantially all the assets of HOLP and its Subsidiaries are
pledged to secure Indebtedness of HOLP and its Subsidiaries.
Additionally, our subsidiary Transwestern has outstanding debt
securities. As of March 31, 2011, the notes would have been
effectively subordinated to approximately $981.8 million of
indebtedness of our Subsidiaries. In addition, FEP, our
unconsolidated joint venture with KMP, is a party to a
$1.1 billion senior revolving credit facility. As of
March 31, 2011, there were $962.5 million of
outstanding borrowings. We have guaranteed 50% of the
obligations of FEP under this facility.
No
Sinking Fund
We are not required to make any mandatory redemption or sinking
fund payments with respect to the notes.
Certain
Covenants
Except as set forth below, neither Energy Transfer nor any of
its Subsidiaries is restricted by the indenture from incurring
any type of indebtedness or other obligation, from paying
dividends or making distributions on its partnership or other
equity interests or from purchasing or redeeming its partnership
or other equity interests. The indenture does not require the
maintenance of any financial ratios or specified levels of net
worth or liquidity. In addition, the indenture does not contain
any provisions that would require Energy Transfer to repurchase
or redeem or otherwise modify the terms of the notes upon a
change in control or other events involving Energy Transfer that
could adversely affect the creditworthiness of Energy Transfer.
Limitations on Liens.
Energy Transfer
will not, nor will it permit any of its Subsidiaries to, create,
assume, incur or suffer to exist any mortgage, lien, security
interest, pledge, charge or other encumbrance
(liens) upon any Principal Property or upon any
capital stock of any Restricted Subsidiary, whether owned on the
date of the supplemental indenture creating the notes or
thereafter acquired, to secure any Indebtedness of Energy
Transfer or any other Person (other than the notes), without in
any such case making effective provisions whereby all of the
outstanding notes are secured equally and ratably with, or prior
to, such Indebtedness so long as such Indebtedness is so secured.
S-22
Notwithstanding the foregoing, under the indenture, Energy
Transfer may, and may permit any of its Subsidiaries to, create,
assume, incur, or suffer to exist without securing the notes
(a) any Permitted Lien, (b) any lien upon any
Principal Property or capital stock of a Restricted Subsidiary
to secure Indebtedness of Energy Transfer or any other Person,
provided
that the aggregate principal amount of all
Indebtedness then outstanding secured by such lien and all
similar liens under this clause (b), together with all
Attributable Indebtedness from Sale-Leaseback Transactions
(excluding Sale-Leaseback Transactions permitted by
clauses (1) through (4), inclusive, of the first paragraph
of the restriction on sale-leasebacks covenant described below),
does not exceed 10% of Consolidated Net Tangible Assets or
(c) any lien upon (i) any Principal Property that was
not owned by Energy Transfer or any of its Subsidiaries on the
date of the supplemental indenture creating the notes or
(ii) the capital stock of any Restricted Subsidiary that
owns no Principal Property that was owned by Energy Transfer or
any of its Subsidiaries on the date of the supplemental
indenture creating the notes, in each case owned by a Subsidiary
of Energy Transfer (an Excluded Subsidiary) that
(A) is not, and is not required to be, a Subsidiary
Guarantor and (B) has not granted any liens on any of its
property securing Indebtedness with recourse to Energy Transfer
or any Subsidiary of Energy Transfer other than such Excluded
Subsidiary or any other Excluded Subsidiary.
Restriction on Sale-Leasebacks.
Energy
Transfer will not, and will not permit any Subsidiary to, engage
in the sale or transfer by Energy Transfer or any of its
Subsidiaries of any Principal Property to a Person (other than
Energy Transfer or a Subsidiary) and the taking back by Energy
Transfer or its Subsidiary, as the case may be, of a lease of
such Principal Property (a Sale-Leaseback
Transaction), unless:
(1) such Sale-Leaseback Transaction occurs within one year
from the date of completion of the acquisition of the Principal
Property subject thereto or the date of the completion of
construction, development or substantial repair or improvement,
or commencement of full operations on such Principal Property,
whichever is later;
(2) the Sale-Leaseback Transaction involves a lease for a
period, including renewals, of not more than three years;
(3) Energy Transfer or such Subsidiary would be entitled to
incur Indebtedness secured by a lien on the Principal Property
subject thereto in a principal amount equal to or exceeding the
Attributable Indebtedness from such Sale-Leaseback Transaction
without equally and ratably securing the notes; or
(4) Energy Transfer or such Subsidiary, within a one-year
period after such Sale-Leaseback Transaction, applies or causes
to be applied an amount not less than the Attributable
Indebtedness from such Sale-Leaseback Transaction to
(a) the prepayment, repayment, redemption, reduction or
retirement of any Indebtedness of Energy Transfer or any of its
Subsidiaries that is not subordinated to the notes or any
guarantee, or (b) the expenditure or expenditures for
Principal Property used or to be used in the ordinary course of
business of Energy Transfer or its Subsidiaries.
Notwithstanding the foregoing, Energy Transfer may, and may
permit any Subsidiary to, effect any Sale-Leaseback Transaction
that is not excepted by clauses (1) through (4), inclusive,
of the preceding paragraph
provided
that the Attributable
Indebtedness from such Sale-Leaseback Transaction, together with
the aggregate principal amount of outstanding Indebtedness
(other than the notes) secured by liens other than Permitted
Liens upon Principal Properties, does not exceed 10% of
Consolidated Net Tangible Assets.
Reports.
So long as any notes are
outstanding, Energy Transfer will:
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for as long as it is required to file information with the SEC
pursuant to the Exchange Act, file with the trustee, within
15 days after it is required to file the same with the SEC,
copies of the annual reports and of the information, documents
and other reports which it is required to file with the SEC
pursuant to the Exchange Act;
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if it is not required to file reports with the SEC pursuant to
the Exchange Act, file with the trustee, within 15 days
after it would have been required to file with the SEC,
financial statements (and with respect to annual reports, an
auditors report by a firm of established national
reputation) and a Managements Discussion and Analysis of
Financial Condition and Results of Operations, both
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S-23
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comparable to what it would have been required to file with the
SEC had it been subject to the reporting requirements of the
Exchange Act; and
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if it is required to furnish annual or quarterly reports to its
equity holders pursuant to the Exchange Act, file these reports
with the trustee.
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Merger, Consolidation or Sale of
Assets.
Energy Transfer shall not consolidate
with or merge into any Person or sell, lease, convey, transfer
or otherwise dispose of all or substantially all of its assets
to any Person unless:
(1) the Person formed by or resulting from any such
consolidation or merger or to which such assets have been
transferred (the successor) is Energy Transfer or
expressly assumes by supplemental indenture all of Energy
Transfers obligations and liabilities under the indenture
and the notes;
(2) the successor is organized under the laws of the United
States, any state or the District of Columbia;
(3) immediately after giving effect to the transaction no
Default or Event of Default has occurred and is
continuing; and
(4) Energy Transfer has delivered to the trustee an
officers certificate and an opinion of counsel, each
stating that such consolidation, merger or transfer complies
with the indenture.
The successor will be substituted for Energy Transfer in the
indenture with the same effect as if it had been an original
party to the indenture. Thereafter, the successor may exercise
the rights and powers of Energy Transfer under the indenture. If
Energy Transfer conveys or transfers all or substantially all of
its assets, it will be released from all liabilities and
obligations under the indenture and under the notes except that
no such release will occur in the case of a lease of all or
substantially all of its assets.
Events of
Default
Each of the following is an Event of Default under
the indenture with respect to the notes of each series:
(1) a default in any payment of interest on such notes when
due that continues for 30 days;
(2) a default in the payment of principal of or premium, if
any, on such notes when due at their stated maturity, upon
redemption, upon declaration or otherwise;
(3) a failure by Energy Transfer or any Subsidiary
Guarantor to comply with its other covenants or agreements in
the indenture for 60 days after written notice of default
given by the trustee or the holders of at least 25% in aggregate
principal amount of the outstanding notes;
(4) certain events of bankruptcy, insolvency or
reorganization of Energy Transfer or any Subsidiary Guarantor as
more fully described in the indenture (the bankruptcy
provisions);
(5) any guarantee of a Subsidiary Guarantor ceases to be in
full force and effect, is declared null and void or is found to
be invalid in a judicial proceeding or any Subsidiary Guarantor
denies or disaffirms its obligations under the indenture or its
guarantee; or
(6) any Indebtedness of Energy Transfer or any Subsidiary
Guarantor is not paid within any applicable grace period after
final maturity or is accelerated by the holders thereof because
of a default and the total amount of such Indebtedness unpaid or
accelerated exceeds $25,000,000.
An Event of Default for the notes will not necessarily
constitute an Event of Default for any other series of debt
securities issued under the indenture, and an Event of Default
for any such other series of debt securities will not
necessarily constitute an Event of Default for any series of the
notes. Further, an event of default under other indebtedness of
Energy Transfer or its Subsidiaries will not necessarily
constitute a Default or an Event of Default for the notes. If an
Event of Default (other than an Event of Default described in
clause (4) above) with respect to the notes of any series
occurs and is continuing, the trustee by notice to
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Energy Transfer, or the holders of at least 25% in principal
amount of the outstanding notes of such series by notice to
Energy Transfer and the trustee, may, and the trustee at the
request of such holders shall, declare the principal of,
premium, if any, and accrued and unpaid interest, if any, on all
the notes of such series to be due and payable. Upon such a
declaration, such principal, premium and accrued and unpaid
interest will be due and payable immediately. The indenture
provides that if an Event of Default described in
clause (4) above occurs, the principal of, premium, if any,
and accrued and unpaid interest on the notes will become and be
immediately due and payable without any declaration of
acceleration, notice or other act on the part of the trustee or
any holders. However, the effect of such provision may be
limited by applicable law.
The holders of a majority in principal amount of the outstanding
notes of the applicable series may, by written notice to the
trustee, rescind any acceleration with respect to the notes of
such series and annul its consequences if rescission would not
conflict with any judgment or decree of a court of competent
jurisdiction and all existing Events of Default with respect to
the notes of such series, other than the nonpayment of the
principal of, premium, if any, and interest on the notes that
have become due solely by such acceleration, have been cured or
waived.
Subject to the provisions of the indenture relating to the
duties of the trustee if an Event of Default occurs and is
continuing, the trustee will be under no obligation to exercise
any of the rights or powers under the indenture at the request
or direction of any of the holders of notes, unless such holders
have offered to the trustee reasonable indemnity or security
against any cost, liability or expense. Except to enforce the
right to receive payment of principal, premium, if any, or
interest when due, no holder of notes may pursue any remedy with
respect to the indenture or the notes, unless:
(1) such holder has previously given the trustee notice
that an Event of Default with respect to the notes is continuing;
(2) holders of at least 25% in principal amount of the
outstanding notes of the applicable series have requested in
writing that the trustee pursue the remedy;
(3) such holders have offered the trustee reasonable
security or indemnity against any cost, liability or expense;
(4) the trustee has not complied with such request within
60 days after the receipt of the request and the offer of
security or indemnity; and
(5) the holders of a majority in principal amount of the
outstanding notes of the applicable series have not given the
trustee a direction that, in the opinion of the trustee, is
inconsistent with such request within such
60-day
period.
Subject to certain restrictions, the holders of a majority in
principal amount of the outstanding notes of the applicable
series have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the
trustee or of exercising any trust or power conferred on the
trustee with respect to the notes of such series. The trustee,
however, may refuse to follow any direction that conflicts with
law or the indenture or that the trustee determines is unduly
prejudicial to the rights of any other holder of notes or that
would involve the trustee in personal liability.
The indenture provides that if a Default (that is, an event that
is, or after notice or the passage of time would be, an Event of
Default) with respect to the notes occurs and is continuing and
is known to the trustee, the trustee must mail to each holder of
notes notice of the Default within 90 days after it occurs.
Except in the case of a Default in the payment of principal of,
and premium, if any, or interest on the notes, the trustee may
withhold such notice, but only if and so long as the trustee in
good faith determines that withholding notice is in the
interests of the holders of notes. In addition, Energy Transfer
is required to deliver to the trustee, within 120 days
after the end of each fiscal year, an officers certificate
as to compliance with all covenants under the indenture and
indicating whether the signers thereof know of any Default or
Event of Default that occurred during the previous year. Energy
Transfer also is required to deliver to the trustee, within
30 days after the occurrence thereof, an officers
certificate specifying any Default or Event of Default, its
status and what action Energy Transfer is taking or proposes to
take in respect thereof.
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Amendments
and Waivers
Amendments of the indenture may be made by Energy Transfer, the
Subsidiary Guarantors, if any, and the trustee with the written
consent of the holders of a majority in principal amount of the
debt securities of each affected series then outstanding under
the indenture (including consents obtained in connection with a
tender offer or exchange offer for debt securities). However,
without the consent of each holder of an affected note, no
amendment may, among other things:
(1) reduce the percentage in principal amount of notes
whose holders must consent to an amendment;
(2) reduce the rate of or extend the time for payment of
interest on any note;
(3) reduce the principal of or extend the stated maturity
of any note;
(4) reduce the premium payable upon the redemption of any
note as described above under Optional
Redemption;
(5) make any notes payable in money other than
U.S. dollars;
(6) impair the right of any holder to receive payment of
the principal of and premium, if any, and interest on such
holders note or to institute suit for the enforcement of
any payment on or with respect to such holders note;
(7) waive a Continuing Default or Event of Default in the
payment of principal and premium, if any, and interest with
respect to such holders note;
(8) make any change in the amendment provisions which
require each holders consent or in the waiver provisions;
(9) release any security that may have been granted in
respect of the notes other than in accordance with the
indenture; or
(10) release the guarantee of any Subsidiary Guarantor
other than in accordance with the indenture or modify its
guarantee in any manner adverse to the holders.
The holders of a majority in principal amount of the outstanding
notes of any series may waive compliance by Energy Transfer with
certain restrictive covenants on behalf of all holders of notes
of such series, including those described under
Certain Covenants Limitations on
Liens and Certain Covenants
Restriction on Sale-Leasebacks. The holders of a majority
in principal amount of the outstanding notes of any series, on
behalf of all such holders, may waive any past or existing
Default or Event of Default with respect to the notes of such
series (including any such waiver obtained in connection with a
tender offer or exchange offer for the notes), except a Default
or Event of Default in the payment of principal, premium or
interest or in respect of a provision that under the indenture
cannot be modified or amended without the consent of the holder
of each outstanding note affected. A waiver by the holders of
notes of any series of compliance with a covenant, a Default or
an Event of Default will not constitute a waiver of compliance
with such covenant or such Default or Event of Default with
respect to any other series of debt securities issued under the
indenture to which such covenant, Default or Event of Default
applies.
Without the consent of any holder, Energy Transfer, the
Subsidiary Guarantors, if any, and the trustee may amend the
indenture to:
(1) cure any ambiguity, omission, defect or inconsistency;
(2) provide for the assumption by a successor of the
obligations of Energy Transfer under the indenture;
(3) provide for uncertificated notes in addition to or in
place of certificated notes;
(4) provide for the addition of any Subsidiary as a
Subsidiary Guarantor, or to reflect the release of any
Subsidiary Guarantor, in either case as provided in the
indenture;
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(5) secure the notes or a guarantee;
(6) add to the covenants of Energy Transfer or any
Subsidiary Guarantor for the benefit of the holders or surrender
any right or power conferred upon Energy Transfer or any
Subsidiary Guarantor;
(7) add any additional Events of Default;
(8) make any change that does not adversely affect the
rights under the indenture of any holder;
(9) supplement any of the provisions of the indenture to
facilitate the defeasance and discharge of notes pursuant to the
terms of the indentures;
(10) comply with any requirement of the SEC in connection
with the qualification of the indenture under the
Trust Indenture Act; and
(11) provide for a successor trustee.
The consent of the holders is not necessary under the indenture
to approve the particular form of any proposed amendment. It is
sufficient if such consent approves the substance of the
proposed amendment. After an amendment with the consent of the
holders under the indenture becomes effective, Energy Transfer
is required to mail to all holders of notes a notice briefly
describing such amendment. However, the failure to give such
notice to all such holders, or any defect therein, will not
impair or affect the validity of the amendment.
Defeasance
and Discharge
Energy Transfer at any time may terminate all its obligations
under the indenture as they relate to the notes of any series
(legal defeasance), except for certain obligations,
including those respecting the defeasance trust and obligations
to register the transfer of or exchange the notes, to replace
mutilated, destroyed, lost or stolen notes and to maintain a
registrar and paying agent in respect of the notes.
Energy Transfer at any time may terminate its obligations under
the covenants described under Certain
Covenants (other than Merger, Consolidation or Sale
of Assets) and the bankruptcy provisions with respect to
each Subsidiary Guarantor, the guarantee provision and the
cross-acceleration provision described under
Events of Default above with respect to
the notes of any series (covenant defeasance).
Energy Transfer may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance
option. If Energy Transfer exercises its legal defeasance
option, payment of the notes of the applicable series may not be
accelerated because of an Event of Default. If Energy Transfer
exercises its covenant defeasance option for the notes, payment
of the notes of the applicable series may not be accelerated
because of an Event of Default specified in clause (3), (4)
(with respect only to a Subsidiary Guarantor), (5) or
(6) under Events of Default above.
If Energy Transfer exercises either its legal defeasance option
or its covenant defeasance option, each guarantee will terminate
with respect to the notes of the applicable series and any
security that may have been granted with respect to the notes of
the applicable series will be released.
In order to exercise either defeasance option, Energy Transfer
must irrevocably deposit in trust (the defeasance
trust) with the trustee money, U.S. Government
Obligations (as defined in the indenture) or a combination
thereof for the payment of principal, premium, if any, and
interest on the notes of the applicable series to redemption or
stated maturity, as the case may be, and must comply with
certain other conditions, including delivery to the trustee of
an opinion of counsel (subject to customary exceptions and
exclusions) to the effect that holders of the notes will not
recognize income, gain or loss for federal income tax purposes
as a result of such defeasance and will be subject to federal
income tax on the same amounts and in the same manner and at the
same times as would have been the case if such defeasance had
not occurred. In the case of legal defeasance only, such opinion
of counsel must be based on a ruling of the Internal Revenue
Service or other change in applicable federal income tax law.
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In the event of any legal defeasance, holders of the notes of
the applicable series would be entitled to look only to the
trust fund for payment of principal of and any premium and
interest on their notes until maturity.
Although the amount of money and U.S. Government
Obligations on deposit with the trustee would be intended to be
sufficient to pay amounts due on the notes at the time of their
stated maturity, if Energy Transfer exercises its covenant
defeasance option for the notes and the notes are declared due
and payable because of the occurrence of an Event of Default,
such amount may not be sufficient to pay amounts due on the
notes at the time of the acceleration resulting from such Event
of Default. Energy Transfer would remain liable for such
payments, however.
In addition, Energy Transfer may discharge all its obligations
under the indenture with respect to the notes of any series,
other than its obligation to register the transfer of and
exchange notes,
provided
that either:
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it delivers all outstanding notes of such series to the trustee
for cancellation; or
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all such notes not so delivered for cancellation have either
become due and payable or will become due and payable at their
stated maturity within one year or are called for redemption
within one year, and in the case of this bullet point, it has
deposited with the trustee in trust an amount of cash sufficient
to pay the entire indebtedness of such notes, including interest
to the stated maturity or applicable redemption date.
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Book-Entry
System
We have obtained the information in this section concerning The
Depository Trust Company (DTC) and its
book-entry systems and procedures from DTC, but we take no
responsibility for the accuracy of this information. In
addition, the description in this section reflects our
understanding of the rules and procedures of DTC as they are
currently in effect. DTC could change its rules and procedures
at any time.
The notes will initially be represented by one or more fully
registered global notes. Each such global note will be deposited
with, or on behalf of, DTC or any successor thereto and
registered in the name of Cede & Co. (DTCs
nominee). You may hold your interests in the global notes
through DTC either as a participant in DTC or indirectly through
organizations that are participants in DTC.
So long as DTC or its nominee is the registered owner of the
global securities representing the notes, DTC or such nominee
will be considered the sole owner and holder of the notes for
all purposes of the notes and the indenture. Except as provided
below, owners of beneficial interests in the notes will not be
entitled to have the notes registered in their names, will not
receive or be entitled to receive physical delivery of the notes
in definitive form and will not be considered the owners or
holders of the notes under the indenture, including for purposes
of receiving any reports delivered by us or the trustee pursuant
to the indenture. Accordingly, each person owning a beneficial
interest in a note must rely on the procedures of DTC or its
nominee and, if such person is not a participant, on the
procedures of the participant through which such person owns its
interest, in order to exercise any rights of a holder of notes.
The Depository Trust Company.
DTC
will act as securities depositary for the notes. The notes will
be issued as fully registered notes registered in the name of
Cede & Co. DTC has advised us as follows: DTC is
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a limited-purpose trust company organized under the New York
Banking Law;
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a banking organization within the meaning of the New
York Banking Law;
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a member of the Federal Reserve System;
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a clearing corporation within the meaning of the New
York Uniform Commercial Code; and
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a clearing agency registered pursuant to the
provisions of Section 17A of the Securities Exchange Act of
1934.
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DTC holds securities that its direct participants deposit with
DTC. DTC facilitates the settlement among direct participants of
securities transactions, such as transfers and pledges, in
deposited securities through
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electronic computerized book-entry changes in direct
participants accounts, thereby eliminating the need for
physical movement of securities certificates.
Direct participants of DTC include securities brokers and
dealers (including the underwriters), banks, trust companies,
clearing corporations, and certain other organizations. DTC is
owned by a number of its direct participants. Access to the DTC
system is also available to securities brokers and dealers,
banks and trust companies that clear through or maintain a
custodial relationship with a direct participant, either
directly or indirectly.
If you are not a direct participant or an indirect participant
and you wish to purchase, sell or otherwise transfer ownership
of, or other interests in, notes, you must do so through a
direct participant or an indirect participant. DTC agrees with
and represents to DTC participants that it will administer its
book-entry system in accordance with its rules and by-laws and
requirements of law. The SEC has on file a set of the rules
applicable to DTC and its direct participants.
Purchases of notes under DTCs system must be made by or
through direct participants, who will receive a credit for the
notes on DTCs records. The ownership interest of each
beneficial owner is in turn to be recorded on the records of
direct participants and indirect participants. Beneficial owners
will not receive written confirmation from DTC of their
purchase, but beneficial owners are expected to receive written
confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the direct
participants or indirect participants through which such
beneficial owners entered into the transaction. Transfers of
ownership interests in the notes are to be accomplished by
entries made on the books of participants acting on behalf of
beneficial owners. Beneficial owners will not receive
certificates representing their ownership interests in the
notes, except in the event that use of the book-entry system for
the notes is discontinued.
To facilitate subsequent transfers, all notes deposited by
direct participants with DTC are registered in the name of
DTCs nominee, Cede & Co., or such other name as
may be requested by an authorized representative of DTC. The
deposit of notes with DTC and their registration in the name of
Cede & Co. do not effect any change in beneficial
ownership. DTC has no knowledge of the actual beneficial owners
of the notes. DTCs records reflect only the identity of
the direct participants to whose accounts such notes are
credited, which may or may not be the beneficial owners. The
participants will remain responsible for keeping account of
their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to direct
participants, by direct participants to indirect participants
and by direct participants and indirect participants to
beneficial owners will be governed by arrangements among them,
subject to any statutory or regulatory requirements as may be in
effect from time to time.
Book-Entry Format.
Under the book-entry
format, the trustee will pay interest or principal payments to
Cede & Co., as nominee of DTC. DTC will forward the
payment to the direct participants, who will then forward the
payment to the indirect participants or to you as the beneficial
owner. You may experience some delay in receiving your payments
under this system. Neither we, the trustee under the indenture
nor any paying agent has any direct responsibility or liability
for the payment of principal or interest on the notes to owners
of beneficial interests in the notes.
DTC is required to make book-entry transfers on behalf of its
direct participants and is required to receive and transmit
payments of principal, premium, if any, and interest on the
notes. Any direct participant or indirect participant with which
you have an account is similarly required to make book-entry
transfers and to receive and transmit payments with respect to
the notes on your behalf. We, the underwriters and the trustee
under the indenture have no responsibility for any aspect of the
actions of DTC or any of its direct or indirect participants.
We, the underwriters and the trustee under the indenture have no
responsibility or liability for any aspect of the records kept
by DTC or any of its direct or indirect participants relating
to, or payments made on account of, beneficial ownership
interests in the notes or for maintaining, supervising or
reviewing any records relating to such beneficial ownership
interests. We also do not supervise these systems in any way.
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The trustee will not recognize you as a holder under the
indenture, and you can only exercise the rights of a holder
indirectly through DTC and its direct participants. DTC has
advised us that it will only take action regarding a note if one
or more of the direct participants to whom the note is credited
directs DTC to take such action and only in respect of the
portion of the aggregate principal amount of the notes as to
which that participant or participants has or have given that
direction. DTC can only act on behalf of its direct
participants. Your ability to pledge notes to non-direct
participants, and to take other actions, may be limited because
you will not possess a physical certificate that represents your
notes.
Neither DTC nor Cede & Co. (nor such other DTC
nominee) will consent or vote with respect to the notes unless
authorized by a direct participant in accordance with DTCs
procedures. Under its usual procedures, DTC will mail an omnibus
proxy to us as soon as possible after the record date. The
omnibus proxy assigns Cede & Co.s consenting or
voting rights to those direct participants to whose accounts the
notes are credited on the record date (identified in a listing
attached to the omnibus proxy).
DTC has agreed to the foregoing procedures in order to
facilitate transfers of the notes among its participants.
However, DTC is under no obligation to perform or continue to
perform those procedures, and may discontinue those procedures
at any time.
Concerning
the Trustee
The indenture contains certain limitations on the right of the
trustee, should it become our creditor, to obtain payment of
claims in certain cases, or to realize for its own account on
certain property received in respect of any such claim as
security or otherwise. The trustee is permitted to engage in
certain other transactions. However, if it acquires any
conflicting interest within the meaning of the
Trust Indenture Act after a Default has occurred and is
continuing, it must eliminate the conflict within 90 days,
apply to the SEC for permission to continue as trustee or resign.
If an Event of Default occurs and is not cured or waived, the
trustee is required to exercise such of the rights and powers
vested in it by the indenture and use the same degree of care
and skill in their exercise as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs.
Subject to such provisions, the trustee will not be under any
obligation to exercise any of its rights or powers under the
indenture at the request of any of the holders of notes unless
they have offered to the trustee reasonable security or
indemnity against the costs, expenses and liabilities it may
incur.
U.S. Bank National Association is the trustee under the
indenture and has been appointed by Energy Transfer as registrar
and paying agent with regard to the notes. The trustees
address is 5555 San Felipe, Suite 1150, Houston, Texas
77056. The trustee and its affiliates maintain commercial
banking and other relationships with Energy Transfer. See
Plan of Distribution for more information regarding
these relationships.
No
Personal Liability of Directors, Officers, Employees, Limited
Partners and Shareholders
The directors, officers, employees and limited partners of
Energy Transfer and the General Partner will not have any
personal liability for our obligations under the indenture or
the notes. Each holder of notes, by accepting a note, waives and
releases all such liability. The waiver and release are part of
the consideration for the issuance of the notes.
Governing
Law
The indenture and the notes are governed by, and will be
construed in accordance with, the laws of the State of New York.
Certain
Definitions
Attributable Indebtedness, when used with respect to
any Sale-Leaseback Transaction, means, as at the time of
determination, the present value (discounted at the rate set
forth or implicit in the terms of the lease included in such
transaction) of the total obligations of the lessee for rental
payments (other than amounts
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required to be paid on account of property taxes, maintenance,
repairs, insurance, assessments, utilities, operating and labor
costs and other items that do not constitute payments for
property rights) during the remaining term of the lease included
in such Sale-Leaseback Transaction (including any period for
which such lease has been extended). In the case of any lease
that is terminable by the lessee upon the payment of a penalty
or other termination payment, such amount shall be the lesser of
the amount determined assuming termination upon the first date
such lease may be terminated (in which case the amount shall
also include the amount of the penalty or termination payment,
but no rent shall be considered as required to be paid under
such lease subsequent to the first date upon which it may be so
terminated) or the amount determined assuming no such
termination.
Consolidated Net Tangible Assets means, at any date
of determination, the total amount of assets of Energy Transfer
and its consolidated Subsidiaries after deducting therefrom:
(1) all current liabilities (excluding (A) any current
liabilities that by their terms are extendable or renewable at
the option of the obligor thereon to a time more than twelve
months after the time as of which the amount thereof is being
computed, and (B) current maturities of long-term
debt); and
(2) the value (net of any applicable reserves) of all
goodwill, trade names, trademarks, patents and other like
intangible assets, all as set forth, or on a pro forma basis
would be set forth, on the consolidated balance sheet of Energy
Transfer and its consolidated Subsidiaries for Energy
Transfers most recently completed fiscal quarter for which
financial statements have been filed with the SEC, prepared in
accordance with generally accepted accounting principles.
Credit Agreement means the Amended and Restated
Credit Agreement, dated as of July 20, 2007, among Energy
Transfer, Wachovia Bank, National Association, as Administrative
Agent, and the other agents and lenders party thereto, and as
further amended, restated, refinanced, replaced or refunded from
time to time.
Exchange Act means the Securities Exchange Act of
1934, as amended, and any successor statute.
General Partner means Energy Transfer Partners GP,
L.P., a Delaware limited partnership, and its successors as
general partner of Energy Transfer.
Indebtedness of any Person at any date means any
obligation created or assumed by such Person for the repayment
of borrowed money or any guaranty thereof.
Permitted Liens means:
(1) liens upon
rights-of-way
for pipeline purposes;
(2) easements,
rights-of-way,
restrictions and other similar encumbrances incurred in the
ordinary course of business and encumbrances consisting of
zoning restrictions, easements, licenses, restrictions on the
use of real property or minor imperfections in title thereto and
which do not in the aggregate materially adversely affect the
value of the properties encumbered thereby or materially impair
their use in the operation of the business of Energy Transfer
and its Subsidiaries;
(3) rights reserved to or vested by any provision of law in
any municipality or public authority to control or regulate any
of the properties of Energy Transfer or any Subsidiary or the
use thereof or the rights and interests of Energy Transfer or
any Subsidiary therein, in any manner under any and all laws;
(4) rights reserved to the grantors of any properties of
Energy Transfer or any Subsidiary, and the restrictions,
conditions, restrictive covenants and limitations, in respect
thereto, pursuant to the terms, conditions and provisions of any
rights-of-way
agreements, contracts or other agreements therewith;
(5) any statutory or governmental lien or lien arising by
operation of law, or any mechanics, repairmens,
materialmens, suppliers, carriers,
landlords, warehousemens or similar lien incurred in
the ordinary course of business which is not more than sixty
(60) days past due or which is being contested in good
faith by appropriate proceedings and any undetermined lien which
is incidental to construction, development, improvement or
repair;
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(6) any right reserved to, or vested in, any municipality
or public authority by the terms of any right, power, franchise,
grant, license, permit or by any provision of law, to purchase
or recapture or to designate a purchaser of, any property;
(7) liens for taxes and assessments which are (a) for
the then current year, (b) not at the time delinquent, or
(c) delinquent but the validity or amount of which is being
contested at the time by Energy Transfer or any of its
Subsidiaries in good faith by appropriate proceedings;
(8) liens of, or to secure performance of, leases, other
than capital leases;
(9) any lien in favor of Energy Transfer or any Subsidiary;
(10) any lien upon any property or assets of Energy
Transfer or any Subsidiary in existence on the date of the
initial issuance of the notes;
(11) any lien incurred in the ordinary course of business
in connection with workmens compensation, unemployment
insurance, temporary disability, social security, retiree health
or similar laws or regulations or to secure obligations imposed
by statute or governmental regulations;
(12) liens in favor of any person to secure obligations
under provisions of any letters of credit, bank guarantees,
bonds or surety obligations required or requested by any
governmental authority in connection with any contract or
statute,
provided
that such obligations do not constitute
Indebtedness; or any lien upon or deposits of any assets to
secure performance of bids, trade contracts, leases or statutory
obligations, and other obligations of a like nature incurred in
the ordinary course of business;
(13) any lien upon any property or assets created at the
time of acquisition of such property or assets by Energy
Transfer or any of its Subsidiaries or within one year after
such time to secure all or a portion of the purchase price for
such property or assets or debt incurred to finance such
purchase price, whether such debt was incurred prior to, at the
time of or within one year after the date of such acquisition;
(14) any lien upon any property or assets to secure all or
part of the cost of construction, development, repair or
improvements thereon or to secure Indebtedness incurred prior
to, at the time of, or within one year after completion of such
construction, development, repair or improvements or the
commencement of full operations thereof (whichever is later), to
provide funds for any such purpose;
(15) any lien upon any property or assets existing thereon
at the time of the acquisition thereof by Energy Transfer or any
of its Subsidiaries and any lien upon any property or assets of
a Person existing thereon at the time such Person becomes a
Subsidiary of Energy Transfer by acquisition, merger or
otherwise;
provided
that, in each case, such lien only
encumbers the property or assets so acquired or owned by such
Person at the time such Person becomes a Subsidiary;
(16) liens imposed by law or order as a result of any
proceeding before any court or regulatory body that is being
contested in good faith, and liens which secure a judgment or
other court-ordered award or settlement as to which Energy
Transfer or the applicable Subsidiary has not exhausted its
appellate rights;
(17) any extension, renewal, refinancing, refunding or
replacement (or successive extensions, renewals, refinancing,
refunding or replacements) of liens, in whole or in part,
referred to in clauses (1) through (16) above;
provided, however,
that any such extension, renewal,
refinancing, refunding or replacement lien shall be limited to
the property or assets covered by the lien extended, renewed,
refinanced, refunded or replaced and that the obligations
secured by any such extension, renewal, refinancing, refunding
or replacement lien shall be in an amount not greater than the
amount of the obligations secured by the lien extended, renewed,
refinanced, refunded or replaced and any expenses of Energy
Transfer or its Subsidiaries (including any premium) incurred in
connection with such extension, renewal, refinancing, refunding
or replacement; or
(18) any lien resulting from the deposit of moneys or
evidence of indebtedness in trust for the purpose of defeasing
Indebtedness of Energy Transfer or any of its Subsidiaries.
S-32
Person means any individual, corporation,
partnership, limited liability company, joint venture,
incorporated or unincorporated association, joint-stock company,
trust, unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
Principal Property means, whether owned or leased on
the date of the initial issuance of the notes or thereafter
acquired:
(1) any pipeline assets of Energy Transfer or any of its
Subsidiaries, including any related facilities employed in the
gathering, transportation, distribution, storage or marketing of
natural gas, refined petroleum products, natural gas liquids and
petrochemicals, that are located in the United States of America
or any territory or political subdivision thereof; and
(2) any processing, compression, treating, blending or
manufacturing plant or terminal owned or leased by Energy
Transfer or any of its Subsidiaries that is located in the
United States or any territory or political subdivision thereof,
except in the case of either of the preceding clause (1) or
this clause (2):
(a) any such assets consisting of inventories, furniture,
office fixtures and equipment (including data processing
equipment), vehicles and equipment used on, or useful with,
vehicles;
(b) any such assets which, in the opinion of the board of
directors of the General Partner are not material in relation to
the activities of Energy Transfer and its Subsidiaries taken as
a whole; and
(c) any assets used primarily in the conduct of the retail
propane marketing business conducted by Heritage Operating, L.P.
and its Subsidiaries.
Restricted Subsidiary means any Subsidiary owning or
leasing, directly or indirectly through ownership in another
Subsidiary, any Principal Property.
Subsidiary means, with respect to any Person, any
corporation, association or business entity of which more than
50% of the total voting power of the equity interests entitled
(without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof or any
partnership of which more than 50% of the partners equity
interests (considering all partners equity interests as a
single class) is, in each case, at the time owned or controlled,
directly or indirectly, by such Person or one or more
Subsidiaries of such Person or a combination thereof.
Subsidiary Guarantor means each Subsidiary of Energy
Transfer that guarantees the notes pursuant to the terms of the
indenture but only so long as such Subsidiary is a guarantor
with respect to the notes on the terms provided for in the
indenture.
S-33
DESCRIPTION
OF THE DEBT SECURITIES
Energy Transfer Partners, L.P. may issue senior debt securities
on a senior unsecured basis under the indenture, dated
January 18, 2005, among Energy Transfer Partners, L.P., as
issuer, the subsidiary guarantors party thereto and
U.S. Bank National Association (as successor to Wachovia
Bank, National Association), as trustee. The debt securities
will be governed by the provisions of the indenture and those
made part of the indenture by reference to the
Trust Indenture Act of 1939, as amended, or the Trust
Indenture Act.
We have summarized material provisions of the indenture and the
debt securities below. This summary is not complete. We have
filed the indenture with the SEC as an exhibit to the
registration statement, and you should read the indenture for
provisions that may be important to you.
References in this Description of the Debt
Securities to we, us and
our mean Energy Transfer Partners, L.P.
Provisions
Applicable to the Indenture
General.
Any series of debt securities will be
our general obligations.
The indenture does not limit the amount of debt securities that
may be issued under the indenture, and does not limit the amount
of other unsecured debt or securities that we may issue. We may
issue debt securities under the indenture from time to time in
one or more series, each in an amount authorized prior to
issuance.
The indenture does not contain any covenants or other provisions
designed to protect holders of the debt securities in the event
we participate in a highly leveraged transaction or upon a
change of control. The indenture also does not contain
provisions that give holders the right to require us to
repurchase their securities in the event of a decline in our
credit ratings for any reason, including as a result of a
takeover, recapitalization or similar restructuring or otherwise.
Terms.
We will prepare a prospectus supplement
and either a supplemental indenture, or authorizing resolutions
of the board of directors of our general partners general
partner, accompanied by an officers certificate, relating
to any series of debt securities that we offer, which will
include specific terms relating to some or all of the following:
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the form and title of the debt securities of that series;
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the total principal amount of the debt securities of that series;
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whether the debt securities will be issued in individual
certificates to each holder or in the form of temporary or
permanent global securities held by a depositary on behalf of
holders;
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the date or dates on which the principal of and any premium on
the debt securities of that series will be payable;
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any interest rate which the debt securities of that series will
bear, the date from which interest will accrue, interest payment
dates and record dates for interest payments;
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any right to extend or defer the interest payment periods and
the duration of the extension;
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whether and under what circumstances any additional amounts with
respect to the debt securities will be payable;
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whether debt securities are entitled to the benefits of any
guarantee of any Subsidiary Guarantor;
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the place or places where payments on the debt securities of
that series will be payable;
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any provisions for optional redemption or early repayment;
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any provisions that would require the redemption, purchase or
repayment of debt securities;
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the denominations in which the debt securities will be issued;
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whether payments on the debt securities will be payable in
foreign currency or currency units or another form and whether
payments will be payable by reference to any index or formula;
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the portion of the principal amount of debt securities that will
be payable if the maturity is accelerated, if other than the
entire principal amount;
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any additional means of defeasance of the debt securities, any
additional conditions or limitations to defeasance of the debt
securities or any changes to those conditions or limitations;
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any changes or additions to the events of default or covenants
described in this prospectus;
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any restrictions or other provisions relating to the transfer or
exchange of debt securities;
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any terms for the conversion or exchange of the debt securities
for our other securities or securities of any other
entity; and
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any other terms of the debt securities of that series.
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This description of debt securities will be deemed modified,
amended or supplemented by any description of any series of debt
securities set forth in a prospectus supplement related to that
series.
We may sell the debt securities at a discount, which may be
substantial, below their stated principal amount. These debt
securities may bear no interest or interest at a rate that at
the time of issuance is below market rates. If we sell these
debt securities, we will describe in the prospectus supplement
any material United States federal income tax consequences and
other special considerations.
If we sell any of the debt securities for any foreign currency
or currency unit or if payments on the debt securities are
payable in any foreign currency or currency unit, we will
describe in the prospectus supplement the restrictions,
elections, tax consequences, specific terms and other
information relating to those debt securities and the foreign
currency or currency unit.
The Subsidiary Guarantees.
Certain of our
subsidiaries, which we refer to collectively as Subsidiary
Guarantors, may fully, irrevocably and unconditionally guarantee
on an unsecured basis all series of our debt securities and will
execute a notation of guarantee as further evidence of their
guarantee. The applicable prospectus supplement will describe
the terms of any guarantee by the Subsidiary Guarantors.
If a series of debt securities is so guaranteed, the Subsidiary
Guarantors guarantee of the debt securities will be the
Subsidiary Guarantors unsecured and unsubordinated general
obligation, and will rank on a parity with all of the Subsidiary
Guarantors other unsecured and unsubordinated
indebtedness. The obligations of each Subsidiary Guarantor under
its guarantee of the debt securities will be limited to the
maximum amount that will not result in the obligations of the
Subsidiary Guarantor under the guarantee constituting a
fraudulent conveyance or fraudulent transfer under federal or
state law, after giving effect to:
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all other contingent and fixed liabilities of the Subsidiary
Guarantor; and
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any collections from or payments made by or on behalf of any
other Subsidiary Guarantors in respect of the obligations of the
Subsidiary Guarantor under its guarantee.
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The guarantee of any Subsidiary Guarantor may be released under
certain circumstances. If we exercise our legal or covenant
defeasance option with respect to debt securities of a
particular series as described below in
Defeasance, then the guarantee of any
Subsidiary Guarantor will be released with respect to that
series. Further, if no default has occurred and is continuing
under the indenture, and to the extent not otherwise prohibited
by the indenture, the guarantee of a Subsidiary Guarantor will
be unconditionally released and discharged:
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automatically upon any sale, exchange or transfer, whether by
way of merger or otherwise, to any person that is not our
affiliate, of all of our direct or indirect limited partnership
or other equity interests in the Subsidiary Guarantor;
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automatically upon the merger of the Subsidiary Guarantor into
us or any other Subsidiary Guarantor or the liquidation and
dissolution of the Subsidiary Guarantor; or
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following delivery of a written notice by us to the trustee,
upon the release of all guarantees by the Subsidiary Guarantor
of any debt of ours for borrowed money for a purchase money
obligation or for a guarantee of either, except for any series
of debt securities.
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Events of Default.
Unless we inform you
otherwise in the applicable prospectus supplement, the following
are events of default with respect to a series of debt
securities:
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failure to pay interest on that series of debt securities for
30 days when due;
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default in the payment of principal of or premium, if any, on
any debt securities of that series when due at its stated
maturity, upon redemption, upon required repurchase or otherwise;
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default in the payment of any sinking fund payment on any debt
securities of that series when due;
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failure by us or, if the series of debt securities is guaranteed
by any Subsidiary Guarantors, by such Subsidiary Guarantors, to
comply with the other agreements contained in the indenture, any
supplement to the indenture or any board resolution authorizing
the issuance of that series for 60 days after written
notice by the trustee or by the holders of at least 25% in
principal amount of the outstanding debt securities issued under
the indenture that are affected by that failure;
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certain events of bankruptcy, insolvency or reorganization of us
or, if the series of debt securities is guaranteed by any
Subsidiary Guarantor, of any such Subsidiary Guarantor;
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if the series of debt securities is guaranteed by any Subsidiary
Guarantor:
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any of the guarantees ceases to be in full force and effect,
except as otherwise provided in the indenture;
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any of the guarantees is declared null and void in a judicial
proceeding; or
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any Subsidiary Guarantor denies or disaffirms its obligations
under the indenture or its guarantee; and
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any other event of default provided for with respect to that
series of debt securities.
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A default under one series of debt securities will not
necessarily be a default under another series. The trustee may
withhold notice to the holders of the debt securities of any
default or event of default (except in any payment on the debt
securities) if the trustee considers it in the interest of the
holders of the debt securities to do so.
If an event of default for any series of debt securities occurs
and is continuing, the trustee or the holders of at least 25% in
principal amount of the outstanding debt securities of the
series affected by the default (or, in the case of the fourth
bullet point appearing above under the heading
Events of Default, at least 25% in
principal amount of all debt securities issued under the
indenture that are affected, voting as one class) may declare
the principal of and all accrued and unpaid interest on those
debt securities to be due and payable. If an event of default
relating to certain events of bankruptcy, insolvency or
reorganization occurs, the principal of and interest on all the
debt securities issued under the indenture will become
immediately due and payable without any action on the part of
the trustee or any holder. The holders of a majority in
principal amount of the outstanding debt securities of the
series affected by the default may in some cases rescind this
accelerated payment requirement (other than acceleration for
nonpayment of principal of or premium or interest on or any
additional amounts with respect to the debt securities).
A holder of a debt security of any series issued under the
indenture may pursue any remedy under the indenture only if:
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the holder gives the trustee written notice of a continuing
event of default for that series;
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the holders of at least 25% in principal amount of the
outstanding debt securities of that series make a written
request to the trustee to pursue the remedy;
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the holders offer to the trustee security or indemnity
satisfactory to the trustee;
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the trustee fails to act for a period of 60 days after
receipt of the request and offer of security or
indemnity; and
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during that
60-day
period, the holders of a majority in principal amount of the
debt securities of that series do not give the trustee a
direction inconsistent with the request.
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This provision does not, however, affect the right of a holder
of a debt security to sue for enforcement of any overdue payment.
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In most cases, holders of a majority in principal amount of the
outstanding debt securities of a series (or of all debt
securities issued under the indenture that are affected, voting
as one class) may direct the time, method and place of:
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conducting any proceeding for any remedy available to the
trustee; and
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exercising any trust or power conferred upon the trustee
relating to or arising as a result of an event of default.
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Under the indenture we are required to file each year with the
trustee a written statement as to our compliance with the
covenants contained in the indenture.
Modification and Waiver.
The indenture may be
amended or supplemented if the holders of a majority in
principal amount of the outstanding debt securities of all
series issued under the indenture that are affected by the
amendment or supplement (acting as one class) consent to it.
Without the consent of the holder of each debt security
affected, however, no modification may:
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reduce the percentage in principal amount of debt securities
whose holders must consent to an amendment, a supplement or a
waiver;
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reduce the rate of or extend the time for payment of interest on
the debt security;
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reduce the principal of, or any premium on, the debt security or
change its stated maturity;
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reduce any premium payable on the redemption of the debt
security or change the time at which the debt security may or
must be redeemed;
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change any obligation to pay additional amounts on the debt
security;
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make payments on the debt security payable in currency other
than as originally stated in the debt security;
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impair the holders right to receive payment of principal
of and premium, if any, and interest on or any additional
amounts with respect to such holders debt securities or to
institute suit for the enforcement of any payment on or with
respect to the debt security;
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make any change in the percentage of principal amount of debt
securities necessary to waive compliance with certain provisions
of the indenture or to make any change in the provision related
to modification;
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waive a continuing default or event of default regarding any
payment on the debt securities;
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except as provided in the indenture, release any security that
may have been granted in respect of any debt securities; or
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except as provided in the indenture, release, or modify the
guarantee any Subsidiary Guarantor in any manner adverse to the
holders.
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The indenture may be amended or supplemented or any provision of
the indenture may be waived without the consent of any holders
of debt securities issued under the indenture:
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to cure any ambiguity, omission, defect or inconsistency;
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to provide for the assumption of our obligations under the
indenture by a successor upon any merger, consolidation or asset
transfer permitted under the indenture;
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to provide for uncertificated debt securities in addition to or
in place of certificated debt securities or to provide for
bearer debt securities;
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to provide any security for, any guarantees of or any additional
obligors on any series of debt securities or the related
guarantees;
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to comply with any requirement to effect or maintain the
qualification of the indenture under the Trust Indenture
Act;
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to add covenants that would benefit the holders of any debt
securities or to surrender any rights we have under the
indenture;
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to add events of default with respect to any debt
securities; and
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to make any change that does not adversely affect any
outstanding debt securities of any series issued under the
indenture.
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The holders of a majority in principal amount of the outstanding
debt securities of any series (or, in some cases, of all debt
securities issued under the indenture that are affected, voting
as one class) may waive any existing or past default or event of
default with respect to those debt securities. Those holders may
not, however, waive any default or event of default in any
payment on any debt security or compliance with a provision that
cannot be amended or supplemented without the consent of each
holder affected.
Defeasance.
When we use the term defeasance,
we mean discharge from some or all of our obligations under the
indenture. If any combination of funds or government securities
are deposited with the trustee under the indenture sufficient to
make payments on the debt securities of a series issued under
the indenture on the dates those payments are due and payable,
then, at our option, either of the following will occur:
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we will be discharged from our or their obligations with respect
to the debt securities of that series and, if applicable, the
related guarantees (legal defeasance); or
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we will no longer have any obligation to comply with the
restrictive covenants, the merger covenant and other specified
covenants under the indenture, and the related events of default
will no longer apply (covenant defeasance).
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If a series of debt securities is defeased, the holders of the
debt securities of the series affected will not be entitled to
the benefits of the indenture, except for obligations to
register the transfer or exchange of debt securities, replace
stolen, lost or mutilated debt securities or maintain paying
agencies and hold moneys for payment in trust. In the case of
covenant defeasance, our obligation to pay principal, premium
and interest on the debt securities and, if applicable,
guarantees of the payments will also survive.
Unless we inform you otherwise in the prospectus supplement, we
will be required to deliver to the trustee an opinion of counsel
that the deposit and related defeasance would not cause the
holders of the debt securities to recognize income, gain or loss
for U.S. federal income tax purposes. If we elect legal
defeasance, that opinion of counsel must be based upon a ruling
from the U.S. Internal Revenue Service or a change in law
to that effect.
No Personal Liability of General Partner.
Our
general partner, and its directors, officers, employees,
incorporators and partners, in such capacity, will not be liable
for the obligations of Energy Transfer Partners, L.P. or any
Subsidiary Guarantor under the debt securities, the indenture or
the guarantees or for any claim based on, in respect of, or by
reason of, such obligations or their creation. By accepting a
debt security, each holder of that debt security will have
agreed to this provision and waived and released any such
liability on the part of our general partner and its directors,
officers, employees, incorporators and partners. This waiver and
release are part of the consideration for our issuance of the
debt securities. It is the view of the SEC that a waiver of
liabilities under the federal securities laws is against public
policy and unenforceable.
Governing Law.
New York law governs the
indenture and will govern the debt securities.
Trustee.
We may appoint a separate trustee for
any series of debt securities. We use the term
trustee to refer to the trustee appointed with
respect to any such series of debt securities. We may maintain
banking and other commercial relationships with the trustee and
its affiliates in the ordinary course of business, and the
trustee may own debt securities.
Form, Exchange, Registration and Transfer.
The
debt securities will be issued in registered form, without
interest coupons. There will be no service charge for any
registration of transfer or exchange of the debt securities.
However, payment of any transfer tax or similar governmental
charge payable for that registration may be required.
Debt securities of any series will be exchangeable for other
debt securities of the same series, the same total principal
amount and the same terms but in different authorized
denominations in accordance with the indenture. Holders may
present debt securities for registration of transfer at the
office of the security registrar or any transfer agent we
designate. The security registrar or transfer agent will effect
the transfer or exchange if its requirements and the
requirements of the indenture are met.
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The trustee will be appointed as security registrar for the debt
securities. If a prospectus supplement refers to any transfer
agents we initially designate, we may at any time rescind that
designation or approve a change in the location through which
any transfer agent acts. We are required to maintain an office
or agency for transfers and exchanges in each place of payment.
We may at any time designate additional transfer agents for any
series of debt securities.
In the case of any redemption, we will not be required to
register the transfer or exchange of:
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any debt security during a period beginning 15 business days
prior to the mailing of the relevant notice of redemption and
ending on the close of business on the day of mailing of such
notice; or
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any debt security that has been called for redemption in whole
or in part, except the unredeemed portion of any debt security
being redeemed in part.
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Payment and Paying Agents.
Unless we inform
you otherwise in a prospectus supplement, payments on the debt
securities will be made in U.S. dollars at the office of
the trustee and any paying agent. At our option, however,
payments may be made by wire transfer for global debt securities
or by check mailed to the address of the person entitled to the
payment as it appears in the security register. Unless we inform
you otherwise in a prospectus supplement, interest payments may
be made to the person in whose name the debt security is
registered at the close of business on the record date for the
interest payment.
Unless we inform you otherwise in a prospectus supplement, the
trustee under the indenture will be designated as the paying
agent for payments on debt securities issued under the
indenture. We may at any time designate additional paying agents
or rescind the designation of any paying agent or approve a
change in the office through which any paying agent acts.
If the principal of or any premium or interest on debt
securities of a series is payable on a day that is not a
business day, the payment will be made on the following business
day. For these purposes, unless we inform you otherwise in a
prospectus supplement, a business day is any day
that is not a Saturday, a Sunday or a day on which banking
institutions in New York, New York or a place of payment on the
debt securities of that series is authorized or obligated by
law, regulation or executive order to remain closed.
Subject to the requirements of any applicable abandoned property
laws, the trustee and paying agent will pay to us upon written
request any money held by them for payments on the debt
securities that remains unclaimed for two years after the date
upon which that payment has become due. After payment to us,
holders entitled to the money must look to us for payment. In
that case, all liability of the trustee or paying agent with
respect to that money will cease.
Book-Entry Debt Securities.
The debt
securities of a series may be issued in the form of one or more
global debt securities that would be deposited with a depositary
or its nominee identified in the prospectus supplement. Global
debt securities may be issued in either temporary or permanent
form. We will describe in the prospectus supplement the terms of
any depositary arrangement and the rights and limitations of
owners of beneficial interests in any global debt security.
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