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 28, 2009
Commission File No. 1-10403
TEPPCO Partners, L.P.
(Exact name of Registrant as specified in its charter)
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Delaware
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76-0291058
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(State or other jurisdiction
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(I.R.S. Employer
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of incorporation)
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Identification Number)
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1100 Louisiana Street, Suite 1600
Houston, Texas 77002
(Address of principal executive offices, including zip code)
(713) 381-3636
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing 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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þ
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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))
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Item 1.01.
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Entry into a Material Definitive Agreement.
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MLP Merger Agreement
TEPPCO Partners, L.P., a Delaware limited partnership (TEPPCO), has entered into an
Agreement and Plan of Merger, dated as of June 28, 2009 (the MLP Merger Agreement), by and among
TEPPCO, Texas Eastern Products Pipeline Company, LLC, a Delaware limited liability company and the
general partner of TEPPCO (TEPPCO GP), Enterprise Products Partners L.P., a Delaware limited
partnership (Enterprise), Enterprise Products GP, LLC, a Delaware limited liability company and
the general partner of Enterprise (Enterprise GP) and Enterprise Sub B LLC, a Delaware limited
liability company and a wholly owned subsidiary of Enterprise (Merger Sub B). Pursuant to the MLP
Merger Agreement, Enterprise will acquire all of the outstanding limited partner interests in
TEPPCO and Merger Sub B will merge with and into TEPPCO, with TEPPCO surviving the merger as a
wholly owned subsidiary of Enterprise (the MLP Merger).
TEPPCO GP and Enterprise GP are both wholly-owned subsidiaries of Enterprise GP Holdings, L.P.
(EPE), which also owns approximately 4.12% and 3.0%, respectively, of the outstanding limited
partner units of TEPPCO and Enterprise.
Under the terms of the MLP Merger Agreement, all outstanding TEPPCO units, other than
3,645,509 TEPPCO units (the Designated Units) owned by an affiliate of EPCO, Inc. (EPCO), a
private company controlled by Dan L. Duncan, will be cancelled and converted into the right to
receive Enterprise common units based on an exchange rate of 1.24 Enterprise common units per
TEPPCO unit. The Designated Units will be converted, based on the 1.24 exchange rate, into the
right to receive 4,520,431 Enterprise Class B Units (the Class B Units). The Class B Units will
not be entitled to regular quarterly cash distributions of Enterprise for sixteen quarters
following the closing of the MLP Merger. The Class B Units will convert automatically into
Enterprise common units on the date immediately following the payment date for the sixteenth
distribution following the closing of the MLP Merger. No fractional Enterprise common units will
be issued in the MLP Merger, and TEPPCO unitholders will, instead, receive cash in lieu of
fractional Enterprise common units, if any.
The MLP Merger Agreement contains customary representations and warranties and covenants by
each of the parties. Completion of the MLP Merger is conditioned upon, among other things: (1)
approval of the MLP Merger Agreement by a majority of outstanding TEPPCO unitholders and the
approval of at least a majority of the votes cast by TEPPCO unitholders (other than certain named
unitholders who are affiliates of EPCO or officers and directors of TEPPCO GP, Enterprise and EPE)
(the Unaffiliated TEPPCO Unitholders), (2) the absence of certain legal impediments prohibiting
the transactions, (3) applicable regulatory approvals, including the termination or expiration of
the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the HSR Act), (4) approval for the listing of the Enterprise common units to be issued
in connection with the MLP Merger on the New York Stock Exchange, (5) the effectiveness of a
registration statement on Form S-4 relating to the Enterprise common units to be issued in the MLP
Merger, (6) the consummation of the transactions contemplated by the GP Merger Agreement (as
defined below) and (7) the receipt of tax opinions relating to the MLP Merger and the qualifying
income (for purposes of taxation as a partnership) of TEPPCO and the combined partnership.
The MLP Merger Agreement contains provisions granting both TEPPCO and Enterprise the right to
terminate the MLP Merger Agreement for certain reasons, including, among others, (1) if the MLP
Merger has not occurred on or before December 31, 2009, and (2) the failure of TEPPCO to obtain
approval of the MLP Merger Agreement by the affirmative vote or consent of its unitholders as
described above. The MLP Merger Agreement does not provide for the payment of any termination or
breakup fees by TEPPCO or Enterprise upon termination.
In connection with the MLP Merger, Enterprise entered into a Support Agreement, dated as of
June 28, 2009 (the Support Agreement), with Dan Duncan and certain of his affiliates (the Duncan
Unitholders). Pursuant to the Support Agreement, the Duncan Unitholders, who directly own
16,691,550 TEPPCO units, agreed to vote their TEPPCO units in favor of the adoption of the MLP
Merger Agreement at any meeting of the TEPPCO unitholders.
A special committee of the Audit, Conflicts and Governance Committee of TEPPCO GP determined
that the MLP Merger and the GP Merger (as defined below) were fair and reasonable to TEPPCO and its
public unitholders.
GP Merger Agreement
In addition to the MLP Merger Agreement, TEPPCO has entered into an Agreement and Plan of
Merger, dated as of June 28, 2009 (the GP Merger Agreement), by and among TEPPCO, TEPPCO GP,
Enterprise, Enterprise GP and Enterprise Sub A LLC, a Delaware limited liability company and wholly
owned subsidiary of Enterprise (Merger Sub A). Pursuant to the GP Merger Agreement, Enterprise
will acquire 100% of the limited liability company interests in TEPPCO GP (the TEPPCO GP
Interests) and Merger Sub A will be merged with and into TEPPCO GP, with TEPPCO GP surviving the
merger as a wholly owned subsidiary of Enterprise (the GP Merger, and, together with the MLP
Merger, the Mergers).
Under the terms of the GP Merger Agreement, EPE, the owner of the TEPPCO GP Interests, will
receive 1,331,681 Enterprise common units and an increase in the capital account of Enterprise GP
to maintain Enterprise GPs two percent general partner interest in Enterprise.
The GP Merger Agreement contains customary representations and warranties and covenants by
each of the parties. Completion of the GP Merger is conditioned upon, among other things: (1) the
absence of certain legal impediments prohibiting the transactions, (2) applicable regulatory
approvals, including the termination or expiration of the applicable waiting period under the HSR
Act and (3) the conditions precedent contained in the MLP Merger Agreement having been satisfied.
The GP Merger Agreement contains provisions granting both TEPPCO and Enterprise the right to
terminate the GP Merger Agreement for certain reasons, including, among others, if the GP Merger
does not occur on or before December 31, 2009 or if the MLP Merger Agreement is terminated.
Memorandum of Understanding
On April 29, 2009, Peter Brinckerhoff and Renee Horowitz, as Attorney in Fact for Rae Kenrow,
purported unitholders of TEPPCO, filed separate complaints in the Court of Chancery of New Castle
County in the State of Delaware (the Court), as putative class actions on behalf of other
unitholders of TEPPCO, concerning a proposal made by Enterprise to
TEPPCO GP, to acquire the outstanding partnership interests
of TEPPCO (the Proposed Merger).
On May 11, 2009, these actions were consolidated into the Brinckerhoff class action, entitled
Texas
Eastern Products Pipeline Company, LLC Merger Litigation
, C.A. No. 4548-VCL.
The initial proposal made at this
time was an exchange of 1.043 Enterprise common units plus $1.00 in cash for each TEPPCO unit. The
complaints named as defendants Enterprise, Enterprise GP, TEPPCO GP, the directors of TEPPCO GP,
EPCO and Dan L. Duncan.
The complaints allege, among other things, that the terms of the Proposed Merger were grossly
unfair to TEPPCOs unitholders, that Mr. Duncan and other defendants who control TEPPCO had acted
to drive down the price of TEPPCOs units and that the Proposed Merger was an attempt to
extinguish, without consideration and without adequate information for TEPPCOs unitholders, a
separate derivative action that previously had been filed on behalf of TEPPCO by Peter Brinckerhoff
against Enterprise, Enterprise GP and certain of its affiliates, EPCO, Dan L. Duncan, TEPPCO GP and
certain of TEPPCO GPs current and former directors. The complaints further allege that the
process through which a special committee of the Audit, Conflicts and Governance Committee of
TEPPCO GP (the Special Committee) was appointed to consider the Proposed Merger is contrary to
the spirit and intent of TEPPCOs partnership agreement and constitutes a breach of the implied
covenant of fair dealing.
On
June 28, 2009, the parties entered into a Memorandum of Understanding (MOU)
in connection with a proposed settlement of the class action and the
derivative action.
Pursuant to
the MOU, the board of directors of TEPPCO GP will recommend to TEPPCO unitholders that they approve
the adoption of the MLP Merger Agreement and take all necessary steps to seek unitholder approval
for the MLP Merger as soon as practicable. Pursuant to the MOU, approval of the Mergers will
require, in addition to votes required under the TEPPCO partnership agreement, the affirmative vote
of at least a majority of the votes cast by
holders of outstanding TEPPCO units, excluding those held by defendants to the derivative actions
and their affiliates. The MOU further provides that the derivative action was considered by the Special Committee to be a
significant asset of TEPPCO for which fair value was obtained in the merger consideration. The
parties also agreed that plaintiffs will be provided with a draft of the proxy statement relating
to the Mergers and the opportunity to comment on any proposed disclosures therein.
The
MOU contemplates that the parties will enter into a stipulation of
settlement within 30 days from the date of the MOU. The stipulation of settlement will be subject
to customary conditions, including Court approval. There can be no assurance that the parties will
ultimately enter into a stipulation of settlement or that the Court will approve the settlement
even if the parties were to enter into such stipulation. In such event, the proposed settlement as
contemplated by the MOU may be terminated. Plaintiffs agreement to settle the derivative action
and merger litigation, including their agreement to the fairness of the proposed terms and process
of the Mergers negotiations is subject to (a) the drafting and execution of the stipulation of
settlement and other such documentation as may be required to obtain final Court approval and
dismissal of the actions, (b) satisfactory confirmatory discovery confirming the fairness of the
Mergers, (c) Court approval and the mailing of the notice of settlement which sets forth the terms
of settlement to TEPPCO unitholders, (d) consummation of the Mergers and (e) final Court
certification and approval of the settlement and dismissal of the actions.
Cautionary Statements
The foregoing descriptions of the MLP Merger Agreement, the GP Merger Agreement and the
Memorandum of Understanding are qualified in their entirety by reference to the full text of the
agreements, which are attached hereto as Exhibits 2.1, 2.2 and 10.1, respectively, and incorporated
herein by reference.
The merger agreements are filed herewith to provide investors with information regarding their
terms and are not intended to provide any other factual information about TEPPCO or Enterprise. In
particular, the assertions embodied in the representations and warranties contained in the merger
agreements are as of specified dates and were made only for purposes of such merger agreements.
Such representations and warranties are solely for the benefit of the parties to the merger
agreements, and may be subject to limitations agreed between the parties, including being qualified
by information contained in the disclosure letters exchanged between the parties in connection with
the execution of the merger agreements that may modify and create exceptions to the representations
and warranties set forth in the merger agreements. Moreover, certain representations and
warranties in the merger agreements were used for the purpose of allocating risk among the parties
thereto, rather than establishing matters as facts. Accordingly, they should not be related upon
as statements of factual information. Investors are not third-party beneficiaries under the merger
agreements and should not rely on the representations and warranties in the merger agreements as
characterizations of the actual state of facts about TEPPCO or Enterprise. None of the
representations and warranties contained in the merger agreements will have any legal effect among
the parties to the merger agreements after the closing of the mergers.
Suspension of Unit Purchase Plan and Distribution Reinvestment Plan Issuances
On June 28, 2009, the Board of Directors of TEPPCO GP approved the suspension of further
issuances under the EPCO, Inc. TPP Employee Unit Plan (UPP), which provides EPCO employees
providing services to TEPPCO with the opportunity to acquire TEPPCO units at a discount, and the
TEPPCO Distribution Reinvestment Plan, which allows owners of TEPPCO units to utilize their cash
distributions from such units to purchase additional TEPPCO units. TEPPCO is required to suspend
further issuances under these plans pursuant to the MLP Merger Agreement. Effectuation of the
suspension of the UPP is at the discretion of EPCO, which established and administers the plan.
Announcements
On June 29, 2009, TEPPCO issued a press release announcing the Mergers. A copy of the press
release is filed herewith as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated
herein by reference. The press release contains forward looking statements that are subject to
the cautionary statements about forward-looking statements set forth in the press release.
On June 29, 2009, officers of TEPPCO and Enterprise issued an EPCO, Inc. memorandum to
employees announcing the Mergers. A copy of that memorandum is filed herewith as Exhibit 99.2 to
this Current Report on Form 8-K and is incorporated herein by reference. The memorandum contains
forward looking statements that are subject to the cautionary statements about forward-looking
statements set forth in the memorandum.
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Forward Looking Statements
This current report on Form 8-K includes forward-looking statements as defined by the SEC.
All statements, other than statements of historical fact, included herein that address activities,
events or developments that TEPPCO, Enterprise or Enterprise GP expect, believe or anticipate will
or may occur in the future, including anticipated benefits and other aspects of the proposed
Mergers, are forward-looking statements. These forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially, including required approvals by
unitholders and regulatory agencies, the possibility that the anticipated benefits from the
proposed Mergers cannot be fully realized, the possibility that costs or difficulties related to
integration of the two companies will be greater than expected, the impact of competition and other
risk factors included in the reports filed with the SEC by TEPPCO, Enterprise and Enterprise GP.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak
only as of their dates. Except as required by law, neither TEPPCO, Enterprise nor Enterprise GP
intends to update or revise its forward-looking statements, whether as a result of new information,
future events or otherwise.
Important Information and Where to Find It
In connection with the proposed MLP Merger, a registration statement of Enterprise, which will
include a prospectus of Enterprise and a proxy statement of TEPPCO and other materials, will be
filed with the Securities and Exchange Commission (SEC). INVESTORS AND SECURITY HOLDERS ARE
URGED TO CAREFULLY READ THE REGISTRATION STATEMENT AND THE DEFINITIVE PROXY STATEMENT/ PROSPECTUS
AND THESE OTHER MATERIALS REGARDING THE PROPOSED TRANSACTION WHEN THEY BECOME AVAILABLE, BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ENTERPRISE, TEPPCO AND THE PROPOSED MERGER. A
definitive proxy statement/prospectus will be sent to security holders of TEPPCO seeking their
approval of the proposed MLP Merger. Investors and security holders may obtain a free copy of the
proxy statement/prospectus (when it is available) and other documents containing information about
Enterprise and TEPPCO, without charge, at the SECs website at www.sec.gov. Copies of the
registration statement and the definitive proxy statement/prospectus and the SEC filings that will
be incorporated by reference in the proxy statement/prospectus may also be obtained for free by
directing a request to: (i) Investor Relations: Enterprise Products Partners L.P., (866) 230-0745,
or (ii) Investor Relations, TEPPCO Partners, L.P., (800) 659-0059.
TEPPCO, its general partner and the directors and management of their general partner may be
deemed to be participants in the solicitation of proxies from TEPPCOs security holders in
respect of the proposed MLP Merger. INFORMATION ABOUT THESE PERSONS CAN BE FOUND IN TEPPCOS 2008
ANNUAL REPORT ON FORM 10-K AND SUBSEQUENT STATEMENTS OF CHANGES IN BENEFICIAL OWNERSHIP ON FILE
WITH THE SEC. ADDITIONAL INFORMATION ABOUT THE INTERESTS OF SUCH PERSONS IN THE SOLICITATION OF
PROXIES IN RESPECT OF THE PROPOSED MERGER WILL BE INCLUDED IN THE REGISTRATION STATEMENT AND THE
PROXY STATEMENT/PROSPECTUS TO BE FILED WITH THE SEC.
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Item 9.01.
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Financial Statements and Exhibits.
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(d)
Exhibits
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Exhibit No.
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Description
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2.1
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Agreement and Plan of Merger, dated as of June 28, 2009, by
and among Enterprise Products Partners L.P., Enterprise
Products GP, LLC, Enterprise Sub B LLC, TEPPCO Partners, L.P.
and Texas Eastern Products Pipeline Company, LLC
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2.2
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Agreement and Plan of Merger, dated as of June 28, 2009 by and
among Enterprise Products Partners L.P., Enterprise Products
GP, LLC, Enterprise Sub A LLC, TEPPCO Partners, L.P. and Texas
Eastern Products Pipeline Company, LLC
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10.1
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Memorandum of Understanding, dated June 28, 2009
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99.1
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Press Release dated June 29, 2009
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99.2
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EPCO, Inc. Employee Memorandum re Announcement regarding
Combination of Partnerships dated June 29, 2009
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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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TEPPCO Partners, L.P.
(Registrant)
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By:
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Texas Eastern Products Pipeline Company, LLC
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General Partner
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Date: June 29, 2009
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By:
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/s/ Patricia A. Totten
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Patricia A. Totten
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Vice President, General Counsel and
Secretary
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Exhibit Index
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Exhibit No.
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Description
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2.1
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Agreement and Plan of Merger, dated as of June 28, 2009, by
and among Enterprise Products Partners L.P., Enterprise
Products GP, LLC, Enterprise Sub B LLC, TEPPCO Partners, L.P.
and Texas Eastern Products Pipeline Company, LLC
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2.2
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Agreement and Plan of Merger, dated as of June 28, 2009 by and
among Enterprise Products Partners L.P., Enterprise Products
GP, LLC, Enterprise Sub A LLC, TEPPCO Partners, L.P. and Texas
Eastern Products Pipeline Company, LLC
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10.1
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Memorandum of Understanding, dated June 28, 2009
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99.1
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Press Release dated June 29, 2009
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99.2
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EPCO, Inc. Employee Memorandum re Announcement regarding
Combination of Partnerships dated June 29, 2009
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