Item 1.01 Entry into a Material Definitive Agreement
On February 23, 2026, ONE Gas, Inc. (the “Company”) entered into an equity distribution agreement (the “Equity Distribution Agreement”) with BofA Securities, Inc. (“BofA Securities”), BTIG, LLC (“BTIG”), Huntington Securities, Inc. (“HSI”), J.P. Morgan Securities LLC (“J.P. Morgan”), Mizuho Securities USA LLC (“Mizuho”), RBC Capital Markets, LLC (“RBC”) and Truist Securities, Inc. (“TSI”), each acting as sales agent for the Company (each a “Manager” and collectively, the “Managers”); Bank of America, N.A., Nomura Global Financial Products, Inc., HSI, JPMorgan Chase Bank, National Association, Mizuho Markets Americas LLC, Royal Bank of Canada and Truist Bank, each acting as forward purchaser (each a “Forward Purchaser” and collectively, the “Forward Purchasers”); and BofA Securities, Nomura Securities International, Inc. (acting through BTIG as agent), HSI, J.P. Morgan, Mizuho, RBC and TSI, each acting as agent for its affiliated Forward Purchaser (each a “Forward Seller” and collectively, the “Forward Sellers”); with respect to the offering and sale from time to time through the Managers of shares of the Company’s common stock, par value $0.01 per share, having an aggregate offering price of up to $225,000,000 (including shares of common stock that may be sold pursuant to the forward sale agreements described below, the “Shares”). Sales of the Shares, if any, will be made by means of ordinary brokers’ transactions through the facilities of the New York Stock Exchange or NYSE Texas at market prices, in block transactions or as otherwise agreed between the Company and the Managers. Under the terms of the Equity Distribution Agreement, the Company may also sell Shares from time to time to a Manager as principal for its own account at a price to be agreed upon at the time of sale. The Equity Distribution Agreement provides that each Manager, when it is acting as the Company’s sales agent, will be entitled to a commission of 2% of the gross offering proceeds of the Shares sold through such Manager. The Company has no obligation to offer or sell any Shares under the Equity Distribution Agreement and may at any time suspend offers and sales under the Equity Distribution Agreement.
The Equity Distribution Agreement provides that, in addition to the issuance and sale of Shares by the Company to or through the Managers, the Company may enter into forward sale agreements under the master forward sale confirmation (the “Master Forward Sale Confirmation”) dated February 23, 2026 between the Company and each Forward Purchaser and the related supplemental confirmations to be entered into between the Company and the relevant Forward Purchaser. In connection with any forward sale agreement, the relevant Forward Purchaser will borrow from third parties and, through its affiliated Forward Seller, sell a number of Shares equal to the number of Shares underlying the particular forward sale agreement. In no event will the aggregate number of Shares sold through the Managers or the Forward Sellers under the Equity Distribution Agreement and under any forward sale agreement have an aggregate sales price in excess of $225,000,000.
The Company will not initially receive any proceeds from the sale of borrowed shares of the Company’s common stock by a Forward Seller. The Company expects to receive proceeds from the sale of Shares by a Forward Seller upon future physical settlement of the relevant forward sale agreement with the relevant Forward Purchaser on dates specified by the Company on or prior to the maturity date of the relevant forward sale agreement. If the Company elects to cash settle or net share settle a forward sale agreement, the Company may not (in the case of cash settlement) or will not (in the case of net share settlement) receive any proceeds, and the Company may owe cash (in the case of cash settlement) or shares of common stock (in the case of net share settlement) to the relevant Forward Purchaser. In connection with each forward sale agreement, the relevant Forward Seller will receive, in the form of a reduced initial forward sale price payable by the relevant Forward Purchaser under its forward sale agreement, a commission of 2% of the volume weighted average of the sales prices of all borrowed shares of common stock sold during the applicable period by it as a Forward Seller.
