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SEC Filings
ENERGY TRANSFER OPERATING, L.P. filed this Form SC TO-T on 05/18/2017
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8. Appraisal Rights; “Going-Private” Rules

Appraisal Rights

Under Delaware law, limited partnerships may, but are not required to, provide for appraisal rights in their partnership agreements. The PennTex Partnership Agreement does not provide for any appraisal rights, and therefore holders of PennTex common units will not have any appraisal rights in connection with the offer or the exercise of the limited call right.

“Going-Private” Rules

Because ETP is an affiliate of PennTex, the offer and the exercise of the limited call right constitute a “going private” transaction for purposes of Rule 13e-3 under the Exchange Act. Rule 13e-3 requires, among other things, that certain financial information concerning PennTex and certain information relating to the fairness of the offer and the exercise of the limited call right and the consideration offered to minority holders of PennTex common units be filed with the SEC and disclosed to minority holders of PennTex common units prior to the consummation of the exercise of the limited call right. ETP has provided such information in this Offer to Purchase.


9. Certain Information Concerning PennTex

PennTex is a Delaware limited partnership with its principal executive offices at 8111 Westchester Drive, Suite 600, Dallas, TX 75225. The telephone number of PennTex’s principal executive offices is (832) 456-4000.

PennTex describes itself as follows:

PennTex Midstream Partners, LP provides natural gas gathering and processing and residue gas and natural gas liquids transportation services to producers in northern Louisiana. Energy Transfer Partners, L.P. owns the general partner of PennTex.

PennTex currently provides natural gas gathering and processing and residue gas and NGL transportation services to producers focused on the Cotton Valley formation in northern Louisiana. Its assets primarily consist of natural gas gathering pipeline, two 200 MMcf/d design-capacity cryogenic natural gas processing plants and residue gas and NGL transportation pipelines. Its primary customer is Range Resources Corporation (“Range Resources”), which completed its acquisition of Memorial Resource Development Corp. and its subsidiaries (“Memorial Resource”) in September 2016. Prior to its acquisition by Range Resources, Memorial Resource was an affiliate of NGP and was PennTex’s primary customer. In addition to providing midstream services to its primary customer with its existing assets, PennTex pursues other opportunities for organic development and growth as producers in our region continue to develop their acreage.

PennTex’s assets are supported by long term, fee-based commercial agreements with Range Resources, including gathering and processing agreements that contain minimum volume commitments. Under the Amended & Restated Area of Mutual Interest and Midstream Exclusivity Agreement dated as of April 14, 2015 among PennTex NLA Holdings, LLC, Range North Louisiana Operating, LLC and PennTex North Louisiana, LLC, as amended, PennTex also has the exclusive right to develop, own and operate midstream assets and to provide midstream services to support Range Resources’ growing production in northern Louisiana (other than production subject to existing third-party commitments or other arrangements to which PennTex consents).

As of the date of this Offer to Purchase, (1) ETP does not know whether any executive officer, director or affiliate of PennTex intends to tender PennTex common units in the Offer, (2) none of PennTex, its executive officers, directors or affiliates have made any public recommendation with respect to the Offer, and (3) PennTex has not made public any appraisal, report or opinion on the fairness of this transaction. Under Rule 14e-2, the PennTex General Partner Board must state its position with respect to this Offer within ten business days of the date of this Offer to Purchase.



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