On June 16, 2023, Spire Inc. (the “Company” or “we”) completed its previously announced underwritten public offering of 1,744,549 shares of the Company’s common stock, par value $1.00 per share (the “common stock”), at a price to the public of $64.20 per share (the “offering”). In connection with the offering, Morgan Stanley & Co. LLC, as Underwriter, was granted an option to purchase up to 261,682 additional shares of common stock, which option is exercisable on or before July 13, 2023, as described below. The offering was conducted as part of our existing “at-the-market” offering program (the “ATM Program”), which was previously registered under the Company’s automatic shelf registration statement on Form S-3 (File No. 333-264799) filed with the Securities and Exchange Commission (the “SEC”) on May 9, 2022. Following the offering, we have an immaterial amount of capacity remaining under the ATM Program, and the Company does not intend to increase such capacity in the near term.
Terms Agreement
In connection with the offering and the forward transaction described below, on June 13, 2023, we entered into a terms agreement (the “Terms Agreement”) with Morgan Stanley & Co. LLC, as Underwriter, Forward Purchaser and Forward Seller, pursuant to which (i) Morgan Stanley & Co. LLC, in its capacity as the forward seller (the “Forward Seller”), agreed to sell to Morgan Stanley & Co. LLC, in its capacity as the underwriter (the “Underwriter”), and (ii) the Underwriter agreed to purchase from the Forward Seller, at a purchase price of $63.60 per share (the “Initial Purchase Price”), 1,744,549 shares of common stock (the “Initial Shares”). Pursuant to the Terms Agreement, the Underwriter was granted the option to purchase all or any portion of 261,682 additional shares of our common stock (the “Option Shares”), exercisable within 30 days from the date of the Terms Agreement, at a purchase price per share equal to the Initial Purchase Price less an amount per share equal to any dividends or distributions declared by the Company and payable on the Initial Shares but not payable on the Option Shares.
Pursuant to the Terms Agreement, the Forward Seller sold to the Underwriter 1,744,549 shares of common stock, which were borrowed by the Forward Seller or its affiliate from third parties.
In connection with the Terms Agreement, the Company and its directors and executive officers have entered into lock-up agreements with the Underwriter pursuant to which they will not, with certain limited exceptions, for a period of 60 days after the date of the Terms Agreement, in the case of the Company, and 45 days after the date of the Terms Agreement, in the case of its directors and executive officers, without the prior written consent of the Underwriter, (a) issue, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for shares of Company’s common stock, (b) in the case of the Company, file any registration statement with the SEC relating to the offering of any shares of Company’s common stock or any securities convertible into or exercisable or exchangeable for shares of Company’s common stock or (c) enter into any swap or other arrangement that transfers to another any of the economic consequences of ownership of Company’s common stock common stock, whether any such transaction described in clause (a) or (c) above is to be settled by delivery of Company’s common stock or such other securities, in cash or otherwise. In addition, without the prior written consent of the Underwriter, the Company’s directors and executive officers may not, during the period ending 45 days after the date of the Terms Agreement, make any demand for or exercise any right with respect to, the registration of any shares of Company’s common stock or any security convertible into or exercisable or exchangeable for Company’s common stock.
Forward Transaction
On June 13, 2023, we also entered into a forward confirmation (the “Forward Sale Agreement”) with Morgan Stanley & Co. LLC (in such capacity, the “Forward Purchaser”), relating to 1,744,549 shares of common stock. If the Underwriter exercises its option to purchase any of the Option Shares, the Company will use commercially reasonable best efforts to enter into an additional forward transaction under an additional forward confirmation with the Forward Purchaser in respect of the number of shares of common stock sold to the Underwriter that are subject to the exercise of such option. If such option is exercised and the Company does not enter into an additional forward transaction for the full number of shares subject to such option, the Company has agreed to issue and sell directly to the Underwriter the number of shares of common stock that are subject to the exercise of such option and are not covered by an additional forward transaction. In connection with the Forward Sale Agreement, the Forward Seller borrowed from third parties and sold to the Underwriter in the offering 1,744,549 shares of common stock as described above.
