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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): June 3, 2011
THE WILLIAMS COMPANIES, INC.
(Exact Name of Registrant as Specified in its Charter)
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Delaware
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1-4174
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73-0569878 |
(State or Other Jurisdiction of
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(Commission File Number)
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(I.R.S. Employer |
Incorporation)
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Identification No.) |
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One Williams Center, Tulsa, Oklahoma
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74172 |
(Address of Principal Executive Offices)
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(Zip Code) |
Registrants Telephone Number, Including Area Code: 918/573-2000
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing
obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01. Entry Into a Material Definitive Agreement.
Entry into New Credit Facility Agreements
The Williams Companies, Inc.
On June 3, 2011, The Williams Companies, Inc. (WMB), as borrower, entered into a new $900
million five-year senior unsecured revolving credit facility agreement (the WMB Credit Facility
Agreement), together with the lenders named therein, and Citibank N.A. (Citi), as administrative
agent. Under the terms of the WMB Credit Facility Agreement, WMB may request an increase in the
commitments of up to an additional $250 million by commitments from either new lenders or increased
commitments from existing lenders. The WMB Credit Facility Agreement may be used for working
capital, acquisitions, capital expenditures and other general corporate purposes.
The WMB Credit Facility Agreement replaces an existing WMB credit agreement, dated as of May
1, 2006, by and among , WMB, the lenders from time to time parties thereto, and Citi, as
administrative agent (as amended, modified, or otherwise supplemented from time to time, the
Existing WMB Credit Agreement).
Interest on borrowings under the WMB Credit Facility Agreement is payable at rates per annum
equal to, at the option of WMB: (1) a fluctuating base rate equal to Citis adjusted base rate plus
the applicable margin, or (2) a periodic fixed rate equal to LIBOR plus the applicable margin. The
adjusted base rate will be the highest of (i) the federal funds rate plus 0.5 percent, (ii) Citis
publicly announced base rate, and (iii) one-month LIBOR plus 1.0 percent. WMB is required to pay a
commitment fee based on the unused portion of the commitments under the WMB Credit Facility
Agreement. The applicable margin and the commitment fee are determined by reference to a pricing
schedule based on WMBs senior unsecured debt ratings.
Under the WMB Credit Facility Agreement, if WMB, in any fiscal quarter, makes one or more
acquisitions for a total aggregate purchase price that exceeds or equals $50 million, WMB is
required to maintain a ratio of debt to EBITDA of no greater than 5.00 to 1.00 for the fiscal
quarter in which the acquisition occurs and the two fiscal quarters following thereafter. In any
other case, WMB is required to maintain a ratio of debt to EBITDA of no greater than 4.50 to 1.00.
Each of the above ratios will be tested beginning June 30, 2011 at the end of each fiscal quarter,
and the debt to EBITDA ratio will be measured on a rolling four-quarter basis.
The WMB Credit Facility Agreement contains customary representations and warranties and
affirmative, negative and financial covenants which were made only for the purposes of the WMB
Credit Facility Agreement and as of the specific date (or dates) set forth therein, and may be
subject to certain limitations as agreed upon by the contracting parties. The covenants limit,
among other things, the ability of WMBs subsidiaries to incur indebtedness, WMB and its material
subsidiaries from granting certain liens supporting indebtedness, and WMBs ability to merge or
consolidate with any person or sell all or substantially all of its assets to any person, enter
into certain affiliate transactions, make certain distributions during the continuation of an event
of default and allow material change in the nature of its business. In addition, the
representations, warranties and covenants contained in the WMB Credit Facility Agreement may be
subject to standards of materiality applicable to the contracting parties that differ from those
applicable to investors. Investors are not third-party beneficiaries of the WMB Credit Facility
Agreement and should not rely on the representations, warranties and covenants contained therein,
or any descriptions thereof, as characterizations of the actual state of facts or conditions of
WMB.
The WMB Credit Facility Agreement includes customary events of default, including events of
default relating to non-payment of principal, interest or fees, inaccuracy of representations and
warranties in any material respect when made or when deemed made, violation of covenants, cross
payment-defaults, cross acceleration, bankruptcy and insolvency events, certain unsatisfied
judgments and a change of control. If an event of default with respect to WMB occurs under the WMB
Credit Facility Agreement, the lenders will be able to terminate the commitments and accelerate the
maturity of the loans of WMB under the WMB Credit Facility Agreement and exercise other rights and
remedies.
The foregoing description of the WMB Credit Facility Agreement does not purport to be complete
and is qualified in its entirety by reference to the WMB Credit Facility Agreement, a copy of which
is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated into this Item 1.01
by reference. The WMB Credit Facility Agreement is filed as an exhibit to this Current Report on
form 8-K to provide investors with information regarding its terms. It is not intended to provide
any other factual information about WMB or the other parties to the agreement or any of their
respective subsidiaries or affiliates.
Williams Partners L.P.
On June 3, 2011, Williams Partners L.P. (WPZ), Northwest Pipeline GP (Northwest) and
Transcontinental Gas Pipe Line Company, LLC (Transco, collectively, the Borrowers or each a
Borrower), entered into a new $2 billion five-year senior unsecured revolving credit facility
agreement (the WPZ Credit Facility Agreement), together with the lenders named therein, and Citi,
as administrative agent. Under the terms of the WPZ Credit Facility Agreement, WPZ may request an
increase in the commitments of up to an additional $400 million by commitments from either new
lenders or increased commitments from existing lenders. Transco and Northwest may each borrow up to
$400 million under the WPZ Credit Facility Agreement to the extent the revolving commitments are
not otherwise utilized by the other Borrowers. On June 3, 2011, WPZ borrowed $300 million under the
WPZ Credit Facility Agreement to prepay borrowings outstanding under the Existing WPZ Credit
Agreement (as defined below), as described in more detail in Item 1.02 below. The WPZ Credit
Facility Agreement may be used for working capital, acquisitions, capital expenditures and other
general limited liability company or partnership, as applicable, purposes and the refinancing of
the Existing WPZ Credit Agreement.
The WPZ Credit Facility Agreement replaces an existing WPZ credit agreement, dated as of
February 17, 2010, by and among, WPZ, Northwest, Transco, the lenders from time to time parties
thereto, and Citi, as administrative agent (as amended, modified, or otherwise supplemented from
time to time, the Existing WPZ Credit Agreement).
Interest on borrowings under the WPZ Credit Facility Agreement is payable at rates per annum
equal to, at the option of a Borrower: (1) a fluctuating base rate equal to Citis adjusted base
rate plus the applicable margin, or (2) a periodic fixed rate equal to LIBOR plus the applicable
margin. The adjusted base rate will be the highest of (i) the federal funds rate plus 0.5 percent,
(ii) Citis publicly announced base rate, and (iii) one-month LIBOR plus 1.0 percent. WPZ is
required to pay a commitment fee based on the unused portion of the commitments under the WPZ
Credit Facility Agreement. The applicable margin and the commitment fee are determined for each
Borrower by reference to a pricing schedule based on such Borrowers senior unsecured debt ratings.
Under the WPZ Credit Facility Agreement, if WPZ, in any fiscal quarter, makes one or more
acquisitions for a total aggregate purchase price that exceeds or equals $50 million, WPZ is
required to maintain a ratio of debt to EBITDA of no greater than 5.50 to 1.00 for the fiscal
quarter in which the acquisition occurs and the two fiscal quarters following thereafter. In any
other case, WPZ is required to maintain a ratio of debt to EBITDA of no greater than 5.00 to 1.00.
For each of Transco and Northwest and their respective consolidated subsidiaries, the ratio of debt
to capitalization (defined as net worth plus debt) is not permitted to be greater than 65%. Each
of the above ratios will be tested beginning June 30, 2011 at the end of each fiscal quarter, and
the debt to EBITDA ratio is measured on a rolling four-quarter basis.
The WPZ Credit Facility Agreement contains customary representations and warranties and
affirmative, negative and financial covenants which were made only for the purposes of the WPZ
Credit Facility Agreement and as of the specific date (or dates) set forth therein, and may be
subject to certain limitations as agreed upon the by contracting parties. The covenants limit,
among other things, each Borrower and each Borrowers respective material subsidiaries from
granting certain liens supporting indebtedness, and each Borrowers ability to merge or consolidate
with any person or sell all or substantially all of its assets to any person, enter into certain
affiliate transactions, make certain distributions during the continuation of an event of default
and allow material change in the nature of its business. In addition, the representations,
warranties and covenants contained in the WPZ Credit Facility Agreement may be subject to standards
of materiality applicable to the contracting parties that differ from those applicable to
investors. Investors are not third-party beneficiaries of the WPZ Credit Facility Agreement and
should not rely on the representations, warranties and covenants contained therein, or any
descriptions thereof, as characterizations of the actual state of facts or conditions of any of
WPZ, Northwest or Transco.
The WPZ Credit Facility Agreement includes customary events of default, including events of
default relating to non-payment of principal, interest or fees, inaccuracy of representations and
warranties in any material respect when made or when deemed made, violation of covenants, cross
payment-defaults, cross acceleration, bankruptcy and insolvency events, certain unsatisfied
judgments and a change of control. If an event of default with respect to a Borrower occurs under
the WPZ Credit Facility Agreement, the lenders will be able to terminate the commitments for all
Borrowers and accelerate the maturity of the loans of the defaulting Borrower under the WPZ Credit
Facility Agreement and exercise other rights and remedies.
The foregoing description of the WPZ Credit Facility Agreement does not purport to be complete
and is qualified in its entirety by reference to the WPZ Credit Facility Agreement listed herein as
Exhibit 10.2, a copy of which has been filed as Exhibit 10.1 to WPZs Current Report on Form 8-K
filed on June 9, 2011 (File No. 001-32599) and incorporated into this Item 1.01 by reference. The
WPZ Credit Facility Agreement is incorporated by reference into this Current Report on Form 8-K to
provide investors with information regarding its terms. It is not intended to provide any other
factual information about WPZ, Transco, Northwest or the other parties to the agreement or any of
their respective subsidiaries or affiliates.
WPX Energy, Inc.
On June 3, 2011, WPX Energy, Inc. (WPX), as borrower, entered into a new $1.5 billion
five-year senior unsecured revolving credit facility agreement (the WPX Credit Facility
Agreement), together with the lenders named therein, and Citi, as administrative agent and
swingline lender. Under the terms of the WPX Credit Facility Agreement, WPX may request an
increase in the commitments of up to an additional $300 million by commitments from either new
lenders or increased commitments from existing lenders. The WPX Credit Facility Agreement may be
used for working capital, acquisitions, capital expenditures and other general corporate purposes.
Under the WPX Credit Facility Agreement, WPX may also obtain same day funds by requesting a
swingline loan of up to an amount of $125 million from the swingline lender. Interest on swingline
loans is payable at a rate per annum equal to a fluctuating base rate equal to Citis adjusted base
rate plus the applicable margin.
The WPX Credit Facility Agreement is not effective until the date on which certain conditions
listed in such Agreement (including, among others, the completion of the initial public offering of
WPX) have been met or waived; provided that such date must be on or before November 30, 2011 or
such later date as may be agreed to by WPX and the lenders. If the effective date has not occurred
by November 30, 2011, the WPX Credit Facility Agreement will automatically terminate unless
otherwise extended by WPX and the lenders.
Interest on borrowings under the WPX Credit Facility Agreement is payable at rates per annum
equal to, at the option of WPX: (1) a fluctuating base rate equal to Citis adjusted base rate plus
the applicable margin, or (2) a periodic fixed rate equal to LIBOR plus the applicable margin. The
adjusted base rate will be the highest of (i) the federal funds rate plus 0.5 percent, (ii) Citis
publicly announced base rate, and (iii) one-month LIBOR plus 1.0 percent. WPX is required to pay a
commitment fee based on the unused portion of the commitments under the WPX Credit Facility
Agreement. The applicable margin and the commitment fee are determined by reference to a pricing
schedule based on WPXs senior unsecured debt ratings.
Under the WPX Credit Facility Agreement, prior to the occurrence of the Investment Grade Date
(as defined below), WPX is required to maintain a ratio of PV to debt (each as defined in the WPX
Credit Facility Agreement and PV primarily relating to the present value of proved oil and gas
reserves) of at least 1.50 to 1.00. For WPX and its consolidated subsidiaries, the ratio of debt
to capitalization (defined as net worth plus debt) is not permitted to be greater than 60%. Each
of the above ratios will be tested beginning June 30, 2011 at the end of each fiscal quarter.
Investment Grade Date means the first date on which WPXs long-term senior unsecured debt ratings
are BBB- or better by S&P or Baa3 or better by Moodys (without negative outlook or negative
watch), provided that the other of the two ratings is at least BB+ by S&P or Ba1 by Moodys.
The WPX Credit Facility Agreement contains customary representations and warranties and
affirmative, negative and financial covenants which were made only for the purposes of the WPX
Credit Facility Agreement and as of the specific date (or dates) set forth therein, and may be
subject to certain limitations as agreed upon by the contracting parties. The covenants limit,
among other things, the ability of WPXs subsidiaries to incur indebtedness, WPX and its material
subsidiaries from granting certain liens supporting indebtedness, making investments, loans or
advances and entering into certain hedging agreements, WPXs ability to merge or consolidate with
any person or sell all or substantially all of its assets to any person, enter into certain
affiliate transactions, make certain distributions during the continuation of an event of default
and allow material change in the nature of its business. In addition, the representations,
warranties and covenants contained in the WPX Credit Facility Agreement may be subject to standards
of materiality applicable to the contracting parties that differ from those applicable to
investors. Investors are not third-party beneficiaries of the WPX Credit Facility Agreement and
should not rely on the representations, warranties and covenants contained therein, or any
descriptions thereof, as characterizations of the actual state of facts or conditions of WPX.
The WPX Credit Facility Agreement includes customary events of default, including events of
default relating to non-payment of principal, interest or fees, inaccuracy of representations and
warranties in any material respect when made or when deemed made, violation of covenants, cross
payment-defaults, cross acceleration, bankruptcy and insolvency events, certain unsatisfied
judgments and a change of control. If an event of default with respect to a borrower occurs under
the WPX Credit Facility Agreement, the lenders will be able to terminate the commitments and
accelerate the maturity of the loans of the defaulting borrower under the WPX Credit Facility
Agreement and exercise other rights and remedies.
The foregoing description of the WPX Credit Facility Agreement does not purport to be complete
and is qualified in its entirety by reference to the WPX Credit Facility Agreement, a copy of which
is attached as Exhibit 10.3 to this Current Report on Form 8-K and incorporated into this Item 1.01
by reference. The WPX Credit Facility Agreement is filed as an exhibit to this Current Report on
Form 8-K to provide investors with information regarding its terms. It is not intended to provide
any other factual information about WPX or the other parties to the agreement or any of their
respective subsidiaries or affiliates.
Item 1.02. Termination of a Material Definitive Agreement
On June 3, 2011, WMB terminated the Existing WMB Credit Agreement, subject to the survival of
any provisions which by their terms survive the termination. There were no outstanding borrowings
under the Existing WMB Credit Agreement. Upon the termination of the Existing WMB Credit
Agreement, WMB entered into the WMB Credit Facility Agreement as stated under Item 1.01 above.
On June 3, 2011, WPZ, Northwest and Transco terminated, and WPZ prepaid all amounts owed under
the Existing WPZ Credit Agreement, comprised of a $300 million borrowing, subject to the survival
of any provisions which by their terms survive the termination. Upon the termination of the
Existing WPZ Credit Agreement, WPZ, Northwest and Transco entered into the WPZ Credit Facility
Agreement as stated under Item 1.01 above.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
On June 3, 2011, WMB entered into the WMB Credit Facility Agreement, WPZ, Northwest and
Transco entered into the WPZ Credit Facility Agreement and WPX entered into the WPX Credit Facility
Agreement, each as described under Item 1.01 above. The descriptions of each of the WMB Credit
Facility Agreement, the WPZ Credit Facility Agreement and the WPX Credit Facility Agreement,
respectively, under Item 1.01 above are incorporated into this Item 2.03 by reference.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
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Exhibit No. |
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Description |
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10.1 |
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Credit Agreement, dated as of June 3, 2011, by and
among The Williams Companies, Inc., the lenders
named therein, and Citibank, N.A., as
Administrative Agent. |
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10.2 |
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Credit Agreement, dated as of June 3, 2011, by and
among Williams Partners L.P., Northwest Pipeline
GP, Transcontinental Gas Pipe Line Company, LLC, as
co-borrowers, the lenders named therein, and
Citibank N.A., as Administrative Agent (filed on
June 9, 2011 as Exhibit 10.1 to Williams Partners
L.P.s Current Report on Form 8-K and incorporated
herein by reference). |
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10.3 |
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Credit Agreement, dated as of June 3, 2011, by and
among WPX Energy, Inc., the lenders named therein,
and Citibank, N.A., as Administrative Agent and
Swingline Lender. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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THE WILLIAMS COMPANIES, INC.
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By: |
/s/ Lorna R. Simms
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Lorna R. Simms |
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Assistant Secretary |
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DATED: June 9, 2011
EXHIBIT INDEX
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Exhibit No. |
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Description |
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10.1 |
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Credit Agreement, dated as of June 3, 2011, by and
among The Williams Companies, Inc., the lenders
named therein, and Citibank, N.A., as
Administrative Agent. |
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10.2 |
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Credit Agreement, dated as of June 3, 2011, by and
among Williams Partners L.P., Northwest Pipeline
GP, Transcontinental Gas Pipe Line Company, LLC, as
co-borrowers, the lenders named therein, and
Citibank N.A., as Administrative Agent (filed on
June 9, 2011 as Exhibit 10.1 to Williams Partners
L.P.s Current Report on Form 8-K and incorporated
herein by reference). |
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10.3 |
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Credit Agreement, dated as of June 3, 2011, by and
among WPX Energy, Inc., the lenders named therein,
and Citibank, N.A., as Administrative Agent and
Swingline Lender. |