8-KMaterial AgreementsRegulation FDExhibits & Filings

ONEOK INC /NEW/ 8-K Report, Material Agreement (Jan 10, 2023)

Filed January 10, 2023For Securities:OKE

Summary

ONEOK, Inc. (OKE) has entered into a material definitive agreement to settle all claims related to the Medford incident that occurred in July 2022. This settlement covers both physical damage and business interruption. The company has agreed to a total insurance payment of $930 million, of which $100 million has already been received. The remaining balance is expected from insurers and reinsurers within 45 days of the agreement. This resolution provides significant financial certainty for ONEOK regarding the Medford incident. The substantial settlement amount indicates the scale of the impact from the incident, but the recovery of $930 million should substantially offset these costs. Investors should note that the final payment is contingent on the timely fulfillment by the insurance and reinsurance parties.

Key Highlights

  • 1ONEOK has reached a full and final settlement for claims stemming from the July 2022 Medford incident.
  • 2The total insurance settlement amount is $930 million.
  • 3$100 million of the settlement amount has already been received by ONEOK.
  • 4The remaining settlement payment is due from insurers and reinsurers within 45 days.
  • 5The settlement covers both physical damage and business interruption claims.
  • 6The agreement involves ONEOK, its subsidiary Bison Prairie Assurance, and a group of insurers and reinsurers.

Frequently Asked Questions

The settlement resolves all financial claims related to the Medford incident in July 2022, providing ONEOK with a significant recovery of $930 million. This brings closure to potential liabilities and business interruption impacts from the event.

The outstanding settlement payment of $830 million (total $930 million minus $100 million received) is expected to be paid by the insurers and reinsurers within 45 days of the January 9, 2023, agreement date.

The filing states that the settlement is for 'all claims for physical damage and business interruption,' and the amount is $930 million. While this is a substantial recovery, the exact total cost of the incident is not detailed in this 8-K, so whether it 'fully' covers all costs cannot be definitively determined from this filing alone.

The primary condition is the timely payment by the insurers and reinsurers within the agreed-upon 45-day period. The settlement agreement includes customary representations and warranties, but the ultimate risk lies in the counterparty's ability to fulfill their payment obligations.