Summary
Atmos Energy Corporation (ATO) announced on June 30, 2021, that it has entered into an Equity Distribution Agreement with several managers and forward purchasers. This agreement allows Atmos Energy to offer and sell shares of its common stock through the New York Stock Exchange, with an aggregate offering price of up to $1 billion. The sales can occur through ordinary brokers' transactions or block transactions at market prices. Additionally, the company may enter into forward sale agreements, where forward purchasers will borrow and sell shares to hedge, with Atmos Energy potentially receiving proceeds upon future settlement of these agreements.
Key Highlights
- 1Atmos Energy can issue and sell up to $1 billion of its common stock through an Equity Distribution Agreement.
- 2Sales will be conducted on the New York Stock Exchange at market prices.
- 3The company can utilize forward sale agreements, allowing for potential future proceeds upon settlement.
- 4There is a 1.00% commission for managers acting as sales agents.
- 5Atmos Energy is not obligated to sell any shares and can suspend sales at any time.
- 6The shares will be issued under an automatic shelf registration statement filed on June 29, 2021.
Frequently Asked Questions
The Equity Distribution Agreement allows Atmos Energy to opportunistically raise capital by selling shares of its common stock in the open market, up to an aggregate offering price of $1 billion.
Shares will be sold through brokers on the New York Stock Exchange, either as ordinary broker's transactions or block transactions, at prevailing market prices. The company may also engage in direct sales to managers as principals.
Forward sale agreements involve forward purchasers borrowing and selling Atmos Energy shares to hedge their positions. Atmos Energy expects to receive proceeds from these agreements upon future physical settlement, though there's a possibility of not receiving proceeds or even owing cash/shares if the agreement is cash-settled or net-share-settled.
No, Atmos Energy is not obligated to sell any shares under the Equity Distribution Agreement and can suspend or stop sales at any time. This provides flexibility in managing its capital raising activities.