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                                                                    EXHIBIT 99-3
 
                   [THE WILLIAMS COMPANIES, INC. LETTERHEAD]
 
   
                                                                   July 25, 1995
    
 
To Holders of the $2.21
  Cumulative Preferred Stock:
 
   
     The Williams Companies, Inc., a Delaware corporation, (the "Company"), is
proposing an exchange offer for up to $90,752,500 aggregate principal amount of
its 9.60% Quarterly Income Capital Securities (the "QUICS(SM")) (Subordinated
Debentures, Due 2025) (Providing for a Late Payment Penalty to be Paid by the
Company in the Event of a Late Payment Period) for any and all shares of its
$2.21 Cumulative Preferred Stock, $1.00 par value (the "Preferred Stock"),
validly tendered and not withdrawn pursuant to the Exchange Offer.
    
 
   
     The principal purpose of the Exchange Offer, which is explained in detail
in the enclosed Prospectus and Letter of Transmittal, is to improve the
Company's after-tax cash flow by replacing shares of the Preferred Stock with
the QUICS. The potential cash flow benefit to the Company arises because
interest payable on the QUICS will be deductible by the Company for federal
income tax purposes, while dividends payable on the shares of the Preferred
Stock are not deductible. If you want to tender your shares and to participate
in the Offer, the instructions for tendering are also set forth in detail in the
enclosed materials. I encourage you to read these materials carefully before
making any decision with respect to the Exchange Offer. Neither the Company nor
its Board of Directors makes any recommendation to any stockholder whether to
tender or to refrain from tendering in the Offer.
    
 
                                          Very truly yours,
 
                                          Keith E. Bailey
                                          Chairman, President and
                                          Chief Executive Officer
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(SM) Lehman Brothers has applied for a service mark for QUICS.