Sunoco 2015 Annual Report Download - page 29

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Conflicts of interest may arise between us and ETP as they are the controlling owner of our general partner, which, due to
limited fiduciary responsibilities, may permit ETP and its affiliates to favor their own interests to the detriment of our
unitholders.
ETP is the controlling owner of our general partner interest and owns 27.1 percent of our limited partnership interests,
including ownership of our outstanding Class B units. Conflicts may arise between the interests of ETP and its affiliates
(including our general partner), and our interests and those of our unitholders. As a result of these conflicts, our general partner
may favor its own interests and the interests of its affiliates (including ETP) over the interests of our unitholders. Our
partnership agreement provides that our general partner may resolve any conflicts of interest involving us and our general
partner and its affiliates, and any resolution of a conflict of interest by our general partner that is "fair and reasonable" to us will
be deemed approved by all partners, including the unitholders, and will not constitute a breach of the partnership agreement
These conflicts may include, among others, the following situations:
• ETP and its affiliates may engage in competition with us. Neither our partnership agreement nor any other agreement
requires ETP to pursue a business strategy that favors us or utilizes our assets, and our general partner may consider
the interests of parties other than us, such as ETP, in resolving conflicts of interest;
• under our partnership agreement, our general partner's fiduciary duties are restricted, and our unitholders have only
limited remedies available in the event of conduct constituting a potential breach of fiduciary duty by our general
partner;
• our general partner determines the amount and timing of asset purchases and sales, capital expenditures, borrowings,
issuance of additional partnership securities, and reserves, each of which can affect the amount of cash available for
distribution to our unitholders and the amount received by our general partner in respect of its incentive distribution
rights ("IDRs");
• our general partner determines which costs incurred by ETP and its affiliates are reimbursable by us; and
• our partnership agreement does not restrict our general partner from causing us to pay it or its affiliates for services
rendered, or from entering into additional contractual arrangements with any of these entities on our behalf, so long as
the terms of any additional contractual arrangements are fair and reasonable to us; and our general partner controls the
enforcement of obligations owed to us by our general partner and its affiliates.
We are a holding company. We conduct our operations through our subsidiaries and depend on cash flow from our
subsidiaries to pay distributions to our unitholders and service our debt obligations.
We are a holding company. We conduct our operations through our subsidiaries. As a result, our cash flow and ability to
pay distributions to our unitholders and to service our debt is dependent upon the earnings of our subsidiaries. In addition, we
are dependent on the distribution of earnings, loans or other payments from our subsidiaries to us. Any payment of dividends,
distributions, loans or other payments from our subsidiaries to us could be subject to statutory or contractual restrictions.
Payments to us by our subsidiaries also will be contingent upon the profitability of our subsidiaries. If we are unable to obtain
funds from our subsidiaries we may not be able to pay distributions to our unitholders or pay interest or principal on our debt
securities when due.
Our general partner may cause us to borrow funds in order to make cash distributions, even where the purpose or effect of
the borrowing benefits the general partner or its affiliates.
ETP is the controlling owner of our general partner and also owns 27.1 percent of our limited partnership interests,
including our outstanding Class B units, and all of our IDRs. Our general partner may cause us to borrow funds from affiliates
of ETP or from third parties in order to pay cash distributions to our unitholders and to our general partner, including
distributions with respect to our general partner's IDRs.
Our general partner has a limited call right that may require our unitholders to sell their common units at an undesirable
time or price.
If at any time our general partner and its affiliates own more than 80 percent of the common units, our general partner
will have the right, but not the obligation, which it may assign to any of its affiliates or to us, to acquire all, but not less than all,
of the common units held by unaffiliated persons at a price not less than their then-current market price. As a result, unitholders
may be required to sell their common units at an undesirable time or price, may not receive a return on the investment, and may
incur a tax liability upon the sale.