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): December 31, 2002
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The Williams Companies, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-4174 73-0569878
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
One Williams Center, Tulsa, Oklahoma 74172
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 918/573-2000
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Not Applicable
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(Former name or former address, if changed since last report)
Item 5. Other Material Events
On December 31, 2002, The Williams Companies, Inc. (Registrant) created
a new pension plan, the Williams Inactive Employee Pension Plan, for all
inactive participants in the Williams Pension Plan as of that date. Retirees and
vested participants who are no longer employees of the Registrant, or its
participating affiliates, were considered inactive participants for purposes of
the new pension plan. Pension assets and liabilities were transferred from the
Williams Pension Plan to this new plan pursuant to Section 4044 of the Employee
Retirement Income Security Act of 1974 (ERISA). The Registrant also contributed
approximately $19 million to this new plan for inactive participants, for which
the accumulated benefit obligation is fully funded as of December 31, 2002.
Because the Williams Pension Plan's accumulated benefit obligation was
not fully funded as of December 31, 2002, the Registrant was required to record
an additional minimum liability, which reduced shareholder equity by
approximately $15 million on an after-tax basis. However, because lump sum
payments from the Williams Pension Plan did not reach the settlement accounting
threshold, the Registrant was not required to recognize certain unrecognized net
losses, which would have increased pension expense, as it had previously
anticipated.
As of the end of 2002, the Registrant estimates the accumulated benefit
obligations of the Williams Pension Plan exceed pension assets by approximately
$75 million. On a current liability basis, as defined under the Internal Revenue
Code, the Registrant estimates that the Williams Pension Plan was 77 percent
funded, or underfunded by approximately $55 million, as of the end of 2002. The
Registrant intends to fund the Williams Pension Plan as required by applicable
government regulations.
Pursuant to the requirements of the Securities Exchange Act of 1934,
Williams has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE WILLIAMS COMPANIES, INC.
Date: January 17, 2003 /s/ Brian K. Shore
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Name: Brian K. Shore
Title: Corporate Secretary