KINDER MORGAN,INC. (NYSE:KMI-A) Files An 8-K Other EventsItem 8.01. Other Events.
On February22, 2018, Kinder Morgan,Inc. (“KMI”) entered into an underwriting agreement (the “Underwriting Agreement”) with Mizuho Securities USA LLC, MUFG Securities Americas Inc. and SMBC Nikko Securities America,Inc., as representatives of the several underwriters named therein, to which KMI agreed to sell $2,000,000,000 in aggregate principal amount of senior notes consisting of (i)$1,250,000,000 in aggregate principal amount of KMI’s 4.300% Senior Notes due 2028 (the “2028 Notes”) and (ii)$750,000,000 in aggregate principal amount of KMI’s 5.200% Senior Notes due 2048 (the “2048 Notes” and together with the 2028 Notes, the “Notes”).
The Notes are guaranteed to a Cross Guarantee Agreement, which is described in and filed as Exhibit10.16 to KMI’s Annual Report on Form10-K for the year ended December31, 2017. The Underwriting Agreement contains customary representations and warranties by KMI. The Underwriting Agreement also contains customary indemnification and contribution provisions whereby KMI and the underwriters have agreed to indemnify each other against certain liabilities. The Notes were offered and sold under a prospectus supplement and related prospectus filed with the Securities and Exchange Commission to a shelf registration statement on FormS-3 (File No.333-207599).
The Notes will be issued to an Indenture, dated as of March1, 2012, between KMI and U.S. Bank National Association, as trustee. The 2028 Notes will mature on March1, 2028. The 2048 Notes will mature on March1, 2048. Interest on the Notes will accrue from March1, 2018 and will be payable semi-annually in arrears on March1 and September1 of each year, beginning on September1, 2018. KMI may redeem all or a part of the Notes at any time at the applicable redemption prices.
Upon the occurrence of an event of default under the Indenture, which includes payment defaults, defaults in the performance of affirmative and negative covenants and bankruptcy and insolvency related defaults, the obligations of KMI under the Notes may be accelerated, in which case the entire principal amount of the Notes would be immediately due and payable.
The foregoing description of the Underwriting Agreement does not purport to be complete and is qualified in its entirety by reference to the Underwriting Agreement, a copy of which is filed as Exhibit1.1 to this Current Report on Form8-K and incorporated herein by reference.
KMI expects to use the proceeds from the offering of the Notes to repay commercial paper and borrowings under KMI’s revolving credit facility and for general corporate purposes. The underwriters and their related entities have, from time to time, engaged in commercial and investment banking transactions with KMI and its affiliates and provided financial advisory services for KMI and its affiliates in the ordinary course of their business, and may do so in the future. Affiliates of the underwriters are lenders under KMI’s revolving credit facility and may hold a portion of KMI’s commercial paper and, accordingly, these entities will receive a portion of the proceeds of the offering of the Notes. Additionally, underwriters and their related entities have received and in the future will receive customary compensation and expense reimbursement for these commercial and investment banking transactions and financial advisory services.