Mdu Resources Group Inc 8-K, filed Apr 25, 2023
Mdu Resources Group Inc (MDU)
8-K
2023-04-25
For: 2023-04-25
View Original
Added on
April 12, 2026
About this 8-K
Mdu Resources Group Inc filed this 8-K on April 25, 2023.
Items reported
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES 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): April 25, 2023
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
| incorporation) | ||||||||
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code (701 ) 530-1000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||||||
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||||||
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
| (Title of each class) | (Trading Symbol(s)) | (Name of each exchange on which registered) | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 8.01 Other Events.
In connection with the previously announced spinoff of Knife River Corporation from MDU Resources Group, Inc. (the “Company”), into a separate publicly traded company (the “separation and distribution”), Knife River Holding Company, a wholly owned subsidiary of the Company, issued $425 million aggregate principal amount of 7.750% senior notes due 2031 (the “notes”), pursuant to an indenture dated as of April 25, 2023, to qualified institutional buyers in reliance on Rule 144A under the Securities Act and to non-U.S. persons in reliance on Regulation S under the Securities Act. Knife River Holding Company, in connection with the separation and distribution, will be the new parent company for Knife River Corporation. The notes will mature on May 1, 2031. The notes bear interest at a rate of 7.750% per annum, payable semi-annually.
Also on April 25, 2023, Knife River Holding Company entered into an escrow agreement with U.S. Bank National Association (in its capacity as escrow agent, the “escrow agent”) and U.S. Bank Trust Company, National Association (in its capacity as trustee under the indenture, the “trustee”), pursuant to which Knife River Holding Company agreed to deposit into an escrow account cash (collectively with any other property from time to time held in the escrow account, the “escrowed property”) equal to the net proceeds of the notes offering. The escrowed property will be released to Knife River Holding Company or to such other person as Knife River Holding Company directs upon delivery by Knife River Holding Company to the escrow agent and the trustee of an officer’s certificate certifying that in the good faith judgment of Knife River Holding Company, the separation and distribution is expected to be consummated on or within one business day of the delivery of such certificate (such certificate, the “spin certificate,” and the date the spin certificate is delivered and the escrowed property is released from escrow, the “escrow release date”).
On the escrow release date, Knife River Holding Company intends to lend or contribute the net proceeds from the notes offering to Knife River Corporation, and, at Knife River Holding Company’s option, use the remaining proceeds to pay Knife River Holding Company’s and its subsidiaries’ fees, costs and expenses related to the separation and distribution. It is expected that Knife River Corporation will use such net proceeds to repay intercompany obligations owing to certain subsidiaries of the Company.
At any time and from time to time on or after May 1, 2026, Knife River Holding Company may redeem the notes at its option, in whole or in part, at the redemption prices set forth in the indenture, plus accrued and unpaid interest to, but excluding, the applicable redemption date. At any time and from time to time prior to such date, Knife River Holding Company may redeem the notes at its option, in whole or in part, at a redemption price of 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the applicable redemption date, plus a “make-whole” premium as set forth in the indenture. In addition, at any time and from time to time on or prior to May 1, 2026, Knife River Holding Company may redeem in the aggregate up to 40% of the original aggregate principal amount of the notes (calculated after giving effect to any issuance of any additional notes under the indenture) with the net cash proceeds from certain equity offerings at a redemption price set
2
forth in the indenture, plus accrued and unpaid interest to, but excluding, the applicable redemption date.
In the event that (x) Knife River Holding Company has not delivered the spin certificate to the trustee and the escrow agent prior to 11:59 p.m. (New York City time) on the date that is five months after April 25, 2023, (y) the escrowed property is released to Knife River Holding Company or to such other person as Knife River Holding Company directs but the separation and distribution is not consummated at or prior to 11:59 p.m. (New York City time) on the fifth business day following the date on which such escrowed property is so released or (z) Knife River Holding Company notifies the escrow agent and the trustee in writing that Knife River Holding Company will not pursue the separation and distribution, Knife River Holding Company will be required to redeem all of the notes then outstanding at a redemption price equal to 100% of the aggregate principal amount of the notes to be redeemed, plus accrued and unpaid interest on the notes to be redeemed, to, but excluding, the special mandatory redemption date.
Prior to the separation and distribution, the notes will be unsecured, unsubordinated obligations of Knife River Holding Company. From and after the escrow release date, the notes will be, jointly and severally, guaranteed by each of Knife River Holding Company’s existing and future direct or indirect wholly owned restricted subsidiaries (subject to certain exceptions) that is a borrower or guarantor under certain syndicated credit facilities of Knife River Holding Company or any other subsidiary guarantor or certain capital markets debt of Knife River Holding Company or any other subsidiary guarantor. From and after the escrow release date, the notes and related guarantees will be unsecured, unsubordinated obligations of Knife River Holding Company and the subsidiary guarantors.
The notes contain customary affirmative and negative covenants, including, among others, limitations on the incurrence of indebtedness, restricted payments, liens, restrictions on distributions from subsidiary guarantors, sales of assets and subsidiary stock, affiliate transactions and certain mergers and consolidations.
The notes are subject to customary events of default for financings of this type, including, among others, non-payment of principal, interest or premium, failure to comply with certain covenants and certain bankruptcy or insolvency events.
A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference into this Item 8.01.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are being furnished as part of this report.
| Exhibit Number | Description | ||||
| 99.1 | |||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | ||||
3
* * *
Cautionary Note on Forward Looking Statements
This Current Report on Form 8-K includes certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements contained in this release, including statements about the planned separation of Knife River Corporation and the future state of the Company are expressed in good faith and are believed by the Company to have a reasonable basis. Nonetheless, actual results may differ materially from the projected results expressed in the forward-looking statements. For a discussion of important factors that could cause actual results to differ materially from those expressed in the forward-looking statements, refer to Item 1A-Risk Factors in the Company's most recent 10-K.
4
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: April 25, 2023
| MDU Resources Group, Inc. | ||||||||
| By: | /s/ Karl A. Liepitz | |||||||
| Karl A. Liepitz | ||||||||
| Vice President, General Counsel | ||||||||
| and Secretary | ||||||||
5
Exhibit 99.1
MDU Resources Announces Closing of Knife River Holding Company’s $425 Million Notes Offering in Connection With Anticipated Knife River Spinoff
BISMARCK, N.D. — April 25, 2023 — MDU Resources Group, Inc. (“MDU Resources”) (NYSE: MDU) today announced the closing of its previously announced offering of $425 million of notes due 2031 (the “notes”) by Knife River Holding Company, a wholly owned subsidiary of MDU Resources (the “Issuer”), in connection with the previously announced spinoff of Knife River Corporation into a separate publicly traded company.
The notes were issued by Knife River Holding Company, which, in connection with the anticipated spinoff, will be the new parent company for Knife River Corporation. Upon the consummation of the spinoff, the notes will be jointly and severally guaranteed by each of Knife River Holding Company’s existing and future direct or indirect wholly owned subsidiaries (subject to certain exceptions) that is a borrower or guarantor under certain syndicated credit facilities or certain capital markets debt of Knife River Holding Company or any other subsidiary guarantor.
The notes bear interest at a rate of 7.750% per annum, payable semiannually in cash in arrears on May 1 and November 1 of each year, beginning November 1, 2023, and will mature on May 1, 2031.
Knife River Holding Company intends to lend or contribute the net proceeds from this offering of the notes to Knife River Corporation and, at Knife River Holding Company’s option, use the remaining proceeds to pay Knife River Holding Company’s and its subsidiaries’ fees, costs and expenses related to the spinoff, the notes offering and the related transactions. It is expected that Knife River Corporation will use such net proceeds to repay intercompany obligations owing to certain subsidiaries of MDU Resources. The net proceeds from the notes offering will be held in escrow until certain conditions relating to the spinoff are satisfied.
The notes were offered, in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), only to persons reasonably believed to be qualified institutional buyers and, pursuant to Regulation S under the Securities Act, only to non-U.S. persons outside the United States. The notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent an effective registration statement or an applicable exemption from registration requirements or in a transaction not subject to the registration requirements of the Securities Act or any state securities laws.
Exhibit 99.1
Wachtell, Lipton, Rosen & Katz is legal counsel to MDU Resources and Knife River Holding Company in connection with the notes offering. Simpson Thacher & Bartlett LLP is legal counsel to the initial purchasers in connection with the notes offering.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful. Any offers of the notes will be made only by means of a private offering memorandum.
About MDU Resources
MDU Resources Group, Inc., a member of the S&P MidCap 400 and the S&P High-Yield Dividend Aristocrats indices, is Building a Strong America® by providing essential products and services through its regulated energy delivery and construction materials and services businesses. For more information about MDU Resources, contact the Investor Relations Department at investor@mduresources.com.
About Knife River
Knife River Corporation mines aggregates and markets crushed stone, sand, gravel and related construction materials, including ready-mix concrete, asphalt and other value-added products. It also distributes cement and asphalt oil. It performs integrated contracting services.
Forward-Looking Statement
The information in this release includes certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements contained in this release, including statements about the planned separation of Knife River Corporation and the future state of MDU Resources, are expressed in good faith and are believed by MDU Resources to have a reasonable basis. Nonetheless, actual results may differ materially from the projected results expressed in the forward-looking statements. For a discussion of important factors that could cause actual results to differ materially from those expressed in the forward-looking statements, refer to Item 1A-Risk Factors in MDU Resources' most recent Form 10-K.
Media Contacts: Laura Lueder, MDU Resources manager of communications and public relations, 701-530-1095
Tony Spilde, Knife River senior director of communications, 541-213-0947
Investor Contact: Brent Miller, director of financial projects and investor relations, 701-530-1730