Item 1.01 Entry into a Material Definitive Agreement.
As previously disclosed, on August 4, 2020,
Black Hills Corporation, a South Dakota corporation (the “Company”), entered into an Amended and Restated Equity Distribution
Sales Agreement (the “Previous Sales Agreement”) to sell shares of common stock having an aggregate gross sales price
of up to $400 million, from time to time, through an “at-the-market” equity offering program utilizing the Company’s
shelf Registration Statement on Form S-3 originally filed on August 4, 2020 (Registration No. 333-240320)
(the “Previous Shelf”).
In anticipation of the approaching expiration of
the Previous Shelf, the Company filed a new shelf Registration Statement on Form S-3 on June 16, 2023 (Registration No. 333-272739) (the “Shelf”) and entered into a new Equity Distribution Sales Agreement on June 16, 2023 (the “Sales
Agreement”) by and among (a) the Company, (b) each of Bank of Montreal, Bank of America, N.A., MUFG Securities EMEA
plc, Mizuho Markets Americas LLC, and Royal Bank of Canada (each a “Forward Purchaser” and together, the “Forward
Purchasers”), (c) each of BMO Capital Markets Corp., BofA Securities, Inc., MUFG Securities Americas Inc., Mizuho
Securities USA LLC, and RBC Capital Markets, LLC (each in its capacity as sales agent and/or principal, an “Agent”
and together, the “Agents”), and (d) each of BMO Capital Markets Corp., BofA Securities, Inc., MUFG Securities
Americas Inc., Mizuho Securities USA LLC, and RBC Capital Markets, LLC (each in its capacity as agent for its affiliated Forward Purchaser
(each, a “Forward Seller” and together, the “Forward Sellers”), with respect to the offering and
sale from time to time through the Agents of shares of the Company’s common stock, par value $1.00, having an aggregate offering
price of up to $400,000,000 (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 at market prices, in block transactions
or as otherwise agreed between the Company and the Agents. Under the terms of the Sales Agreement, the Company may also sell Shares from
time to time to an Agent as principal for its own account at a price to be agreed upon at the time of sale. The Sales Agreement provides
that each Agent, when it is acting as the Company’ sales agent, will be entitled to a commission of up to 2% of the gross offering
proceeds of the Shares sold through such Agent. The Company has no obligation to offer or sell any Shares under the Sales Agreement and
may at any time suspend offers under the Sales Agreement.
The Sales Agreement provides
that, in addition to the issuance and sale of Shares by the Company to or through the Agents, the Company may enter into forward sale
agreements under a master forward confirmation (each, a “Master Forward Confirmation”) 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 Agents or the Forward Sellers under the Sales Agreement and under any forward sale agreement
have an aggregate sales price in excess of $400,000,000.
We will not initially
receive any proceeds from the sale of borrowed shares of our common stock by a Forward Seller. We expect to receive proceeds from the
sale of shares of our common stock upon future physical settlement of the relevant forward sale agreement with the relevant Forward Purchaser
on dates specified by us on or prior to the maturity date of the relevant forward sale agreement. If we elect to cash settle or net share
settle a forward sale agreement, we may not (in the case of cash settlement) or will not (in the case of net share settlement) receive
any proceeds, and we may owe cash (in the case of cash settlement) or shares of our 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 up
to 2% of the volume weighted average of the sales prices of all borrowed shares of our common stock sold during the applicable period
by it as a Forward Seller.
In
the ordinary course of business, certain of the parties to the Sales Agreement or their respective affiliates have provided and may in
the future provide commercial, financial advisory or investment banking services for the Company and its subsidiaries for which they have
received or will receive customary compensation. For example, affiliates of certain of the parties to the Sales Agreement are lenders
and/or agents under certain of our existing credit facilities. To the extent that we use the net proceeds from the offering to repay amounts
we have borrowed, may borrow or re-borrow in the future under such facilities, those lenders will receive their pro rata portion of the
proceeds from this offering we use to pay any such amounts.
The summary of the Sales
Agreement and the Master Forward Confirmation in this report does not purport to be complete and is qualified by reference to the full
text of the Sales Agreement and the form of Master Forward Confirmation, which are filed as Exhibits 1.1 and 1.2, respectively, to this
Current Report on Form 8-K, and are incorporated herein by reference.