What changed in this filing

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Item 1A. Risk Factors

2025-11-21 compared with 2024-11-22 · 75 added, 61 removed, 233 unchanged (37% of the section changed)

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These difficulties could adversely affect the Company’s growth strategies, operations and financial performance.

The Company’s ability to borrow under its credit facilities and commercial paper agreements, and its ability to issue long-term debt under its indentures, depend on the Company’s compliance with its obligations under the facilities, agreements and indentures.

For example, to issue incremental long-term debt, subject to certain exceptions, the Company must meet an interest coverage test under its 1974 indenture.

In light of impairments recognized in fiscal 2024, the Company expects to be precluded from issuing incremental long-term debt from January 1, 2025 to June 13, 2025, the maturity date of the Company’s remaining indebtedness outstanding under the 1974 indenture.

However, to the extent a need arises to issue such incremental long-term debt, the Company expects to be able to place future principal and interest payments in trust for the benefit of bondholders pursuant to the terms of the 1974 indenture.

Depositing the future principal and interest payments in trust would effectively relieve the Company from its obligations to comply with the 1974 indenture’s restrictions, including those on the issuance of incremental long-term debt.

The Company’s ability to borrow under its credit facilities and commercial paper agreements, and its ability to issue long-term debt under its indenture, depend on the Company’s compliance with its obligations under the facilities, agreements and indenture.

The Company’s short-term bank loans, commercial paper, and borrowings under the Term Loan Agreement, entered into on February 14, 2024 with six lenders (the “Term Loan Agreement”), are in the form of floating rate debt or debt that may have rates fixed for short periods of time (up to six months), resulting in exposure to interest rate fluctuations in the absence of interest rate hedging transactions.

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Additionally, $2.4 billion of the Company’s outstanding long-term debt would be subject to an interest rate increase if certain fundamental changes occur that involve a material subsidiary and result in a downgrade of a credit rating assigned to the notes below investment grade.

In addition to the $1.4 billion, another $500 million of the Company’s outstanding long-term debt would be subject to an interest rate increase based solely on a downgrade of a credit rating assigned to the notes below investment grade, regardless of any additional fundamental changes.

In addition, we may be subject to financial risks related to our planned acquisition of all of the issued and outstanding equity interests of Vectren Energy Delivery of Ohio, LLC (“CenterPoint Ohio”) from CenterPoint Energy Resources Corp.

(the “Seller”).

For discussion of these risks, refer to the risk factor under the heading “ The planned acquisition of CenterPoint Ohio may limit our financial flexibility.

The regulatory, legislative, consumer behaviors and capital access developments related to climate change may adversely affect operations and financial results.

The laws, regulations and other initiatives to address climate change may impact the Company’s financial results.

It is not possible at this time to determine whether changes in the federal administration may change the regulatory focus and/or implementation of rules relating to climate change.

In early 2021, the U.S.

rejoined the Paris Agreement, the international effort to establish emissions reduction goals for signatory countries.

Under the Paris Agreement, signatory countries are expected to submit their nationally determined contributions to curb greenhouse gas emissions and meet the agreed temperature objectives every five years.

On April 22, 2021, the federal administration announced the U.S.

nationally determined contribution to achieve a fifty to fifty-two percent reduction from 2005 levels in economy-wide net greenhouse gas pollution by 2030.

Executive orders from the federal administration, in addition to federal, state and local legislative and regulatory initiatives

proposed or adopted in an attempt to limit the effects of climate change, including greenhouse gas emissions, could have significant impacts on the energy industry including government-imposed limitations, prohibitions or moratoriums on the use and/or production of natural gas, establishment of a carbon tax and/or methane fee, lack of support for system modernization, as well as accelerated depreciation of assets and/or stranded assets.

Federal and state legislatures have from time to time considered bills that would establish a cap-and-trade program, cap-and-invest program, methane fee, carbon tax, or other similar mechanisms to incent the reduction of greenhouse gas emissions.

For example, in August 2022, the federal Inflation Reduction Act was signed into law, which includes a waste emissions charge that is expected to be applicable to the annual methane emissions of certain oil and gas facilities, above specified methane intensity thresholds, for emissions reported to the U.S.

EPA for calendar year 2024.

Federal, state and local legislative and regulatory initiatives proposed or adopted in an attempt to limit the effects of climate change, including greenhouse gas emissions, could have significant impacts on the energy industry including government-imposed limitations, prohibitions or moratoriums on the use and/or production of natural gas, establishment of a carbon tax and/or methane fee, lack of support for system modernization, as well as accelerated depreciation of assets and/or stranded assets.

A number of states have also adopted energy strategies or plans with goals that include the reduction of greenhouse gas emissions.

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Furthermore, in 2019, the New York State legislature passed the CLCPA, which created emission reduction and electrification mandates, and could ultimately impact the Utility segment’s customer base and business.

Pursuant to the CLCPA, New York’s Climate Action Council (“CAC”) approved a final scoping plan that includes recommendations to strategically downsize and decarbonize the natural gas system and curtail use of natural gas and natural gas appliances.

The final scoping plan was approved on December 19, 2022 and includes detailed recommendations to meet the CLCPA’s emissions reduction targets in the transportation, buildings, electricity, industry, agriculture & forestry and waste sectors.

Pursuant to the CLCPA, in December 2022, New York’s Climate Action Council (“CAC”) approved a final scoping plan that includes

recommendations to strategically downsize and decarbonize the natural gas system and curtail use of natural gas and natural gas appliances, as well as recommendations to meet the CLCPA’s emissions reduction targets in the transportation, buildings, electricity, industry, agriculture & forestry and waste sectors.

The final scoping plan also recommends statewide and cross-sector policies relevant to gas system transition, economywide strategies, land use, local government, and adaptation and resilience.

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In January 2023, New York’s Governor directed the NYDEC and the New York State Energy Research and Development Authority to advance an economywide cap-and-invest program that establishes a declining cap on greenhouse gas emissions, and invests in programs to drive emissions reductions.

In addition, in October 2025, a New York State court directed NYDEC to promulgate rules and regulations to ensure compliance with emissions reductions limits outlined in the CLCPA by February 6, 2026, which may include such a cap-and-invest program.

If this proposed program or a similar program becomes effective and the Company becomes subject to new or revised cap-and-trade programs, cap-and-invest programs, methane charges, fees for carbon-based fuels or other similar costs or charges, the Company may experience additional costs and incremental operating expenses, which would impact our future earnings and cash flows, and may also experience decreased revenue in the event that implementation of these policies leads to reduced demand for natural gas.

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While the Company does not currently expect that this legislation will have a substantial impact on its financial results or operations, future legislation or regulation that aims to reduce natural gas demand or to impose additional operations requirements or restrictions on natural gas facilities, if effectuated, could impact our future earnings and cash flows.

In addition, in December 2024 (and later amended in February 2025), New York’s Governor signed the Climate Change Superfund Act into law, which will require certain fossil fuel producers, refiners and related entities to pay into a state “climate superfund” an amount commensurate with the entity’s past global greenhouse gas emissions over a specified period of time.

The NYDEC has until June 2027 to develop implementing regulations.

The Act is currently the subject of multiple federal court lawsuits challenging its constitutionality.

Additionally, the trend toward increased energy conservation, change in consumer behaviors, competition from renewable energy sources, and technological advances to address climate change may reduce the demand for natural gas, which could impact our future earnings and cash flows.

For further discussion of the risks associated with environmental regulation to address climate change, refer to Part II, Item 7, MD&A under the heading “Environmental Matters.”

Further, recent trends directed toward a low-carbon economy could shift funding away from, or limit or restrict certain sources of funding for, companies focused on fossil fuel-related development or carbon-intensive investments.

Further, the trend toward a low-carbon economy could shift funding away from, or limit or restrict certain sources of funding for, companies focused on fossil fuel-related development or carbon-intensive investments.

To the extent financial markets view climate change and greenhouse gas emissions as a financial risk, the Company’s cost of and access to capital could be negatively impacted.

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Organized opposition to the natural gas industry, including exploration and production activity, pipeline expansion and replacement projects, and the extension and continued operation of natural gas distribution systems, may continue to increase as a result of, among other things, safety incidents involving natural gas facilities, and concerns raised by policymakers, financial institutions and advocacy groups about greenhouse gas emissions, hydraulic fracturing, or fossil fuels generally.

This opposition may lead to increased regulatory and legislative initiatives that could place limitations, prohibitions or moratoriums on the use and development of natural gas, impose costs tied to carbon emissions, provide cost advantages to alternative energy sources, or impose mandates that increase operational costs associated with new natural gas infrastructure and technology.

There are also increasing litigation risks associated with climate change concerns and related disclosures.

There are also increasing litigation risks associated with climate change concerns and related

Increased litigation could cause operational delays or restrictions, and increase the Company’s operating costs.

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Any delay in project development or construction may prevent a planned project from going into service when anticipated, which could cause a delay in the receipt of revenues from those facilities, result in increased project costs due to extended construction timeframes and asset write-offs, and materially impact operating results or anticipated results.

Additionally, delays in pipeline construction projects or gathering facility completion could impede the Exploration and Production segment’s ability to transport its production, or to fulfill obligations to sell at contracted delivery points.

Additionally, delays in pipeline construction projects or gathering facility completion could impede Seneca’s ability to transport its production, or to fulfill obligations to sell at contracted delivery points.

FINANCIAL RISKS

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Such operating subsidiaries may not generate sufficient net income to pay dividends to the Company or generate sufficient cash flow to make payments of principal or interest on such intercompany loans.

The Company may be adversely affected by economic conditions and their impact on our suppliers and customers.

The Company may be adversely affected by economic conditions, including trade policies, and their impact on our suppliers and customers.

Periods of slowed economic activity generally result in decreased energy consumption, particularly by industrial and large commercial companies.

As a consequence, national or regional recessions or other downturns in economic activity could adversely affect the Company’s revenues and cash flows or restrict its future growth.

Additionally, supply chain disruptions, and the associated costs and inflation related thereto, could have an impact on the Company’s operations.

Additionally, current tariffs, as well as the imposition of additional tariffs on U.S.

imports of various goods and related retaliatory tariffs, as well as supply chain disruptions, and the associated costs and inflation related thereto, could have an impact on the Company’s operations.

Economic conditions in the Company’s utility service territories, along with legislative and regulatory prohibitions and/or limitations on terminations of service, also impact its collections of accounts receivable.

Customers of the Company’s Utility segment may have particular trouble paying their bills during periods of declining economic activity, high inflation, or high commodity

prices, potentially resulting in increased bad debt expense and reduced earnings.

Similarly, if reductions were to occur in funding of the federal Low Income Home Energy Assistance Program, bad debt expense could increase and earnings could decrease.

Customers of the Company’s Utility segment may have particular trouble paying their bills during periods of declining economic activity, high inflation, or high commodity prices, potentially resulting in increased bad debt expense and reduced earnings.

Similarly, if reductions were to occur in funding of the federal Low Income Home Energy Assistance Program, or such funding was delayed or suspended for a prolonged period, bad debt expense could increase and earnings could decrease.

In addition, exploration and production companies that are customers of the Company’s Pipeline and Storage segment may decide not to renew contracts for the same transportation capacity.

Certain customers of the Company’s Exploration and Production segment can represent a concentrated risk from time to time.

Certain customers of Seneca can represent a concentrated risk from time to time.

Any of these events or circumstances could have or contribute to a material adverse effect on the Company’s results of operations, financial condition and cash flows.

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Fluctuations in natural gas prices could adversely affect revenues, cash flows and profitability.

Financial results in the Company’s Exploration and Production segment are materially dependent on prices received for its natural gas production.

Financial results in the Company’s Integrated Upstream and Gathering segment are materially dependent on prices received for its natural gas production.

Both short-term and long-term price trends affect the economics of exploring for, developing, producing, and gathering natural gas.

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The Company has significant transactions involving price hedging of its natural gas production, fixed price natural gas sale commitments, as well as its foreign exchange transactions.

To protect itself to some extent against price volatility and to lock in fixed pricing on natural gas production for certain periods of time, the Company’s Exploration and Production segment regularly enters into commodity price derivatives contracts (hedging arrangements) with respect to a portion of its expected production.

To protect itself to some extent against price volatility and to lock in fixed pricing on natural gas production for certain periods of time, Seneca regularly enters into commodity price derivatives contracts (hedging arrangements) with respect to a portion of its expected production.

These contracts may extend over multiple years, covering a substantial majority of the Company’s expected natural gas production over the course of the current fiscal year, and lesser percentages of subsequent years’ expected production.

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The nature of these hedging contracts could lead to potential liquidity impacts in scenarios of significantly increased natural gas prices if the Company has hedged its current production at prices below the current market price.

Hedging collateral deposits represent the cash, letters of credit, or other eligible instruments held in Company funded margin accounts to serve as collateral for hedging positions used in the Company’s Exploration and Production segment.

A significant increase in natural gas prices may cause the Company’s outstanding derivative instrument contracts to be in a liability position creating margin calls on the Company’s hedging arrangements, which could require the Company to temporarily post significant amounts of cash collateral with our hedge counterparties.

Hedging collateral deposits represent the cash, letters of credit, or other eligible instruments held in Company funded margin accounts to serve as collateral for hedging positions used at Seneca.

A significant increase in natural gas prices may cause certain of the Company’s outstanding derivative instrument contracts to be in a liability position creating margin calls on the Company’s hedging arrangements, which could require the Company to temporarily post significant amounts of cash collateral with our hedge counterparties.

That collateral could be in excess of the Company’s available short-term liquidity under its committed credit facility and other uncommitted sources of capital, leading to potential default under certain of its hedging arrangements.

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These parties might not be able to perform their obligations under the hedge arrangements.

In the Exploration and Production segment, under the Company’s hedging guidelines, natural gas derivatives contracts must be confined to the price hedging of existing and forecast production.

Under the Company’s hedging guidelines, natural gas derivatives contracts must be confined to the price hedging of existing and forecasted production.

The Company maintains a system of internal controls to monitor compliance with its guidelines.

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the assumed effect of governmental regulation;

and assumptions concerning natural gas prices, production and development costs, severance and excise taxes, and capital

expenditures.

and assumptions concerning natural gas prices, production and development costs, severance and excise taxes, and capital expenditures.

Changes in natural gas prices impact the quantity of economic natural gas reserves.

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If conditions remain constant, then the Company is reasonably certain that its reserve estimates represent economically recoverable natural gas reserves and future net cash flows.

If conditions change in the future, then subsequent reserve estimates may be revised accordingly.

If conditions change in the future, then

subsequent reserve estimates may be revised accordingly.

You should not assume that the present value of future net cash flows from the Company’s proved reserves is the current market value of the Company’s estimated natural gas reserves.

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Depending on the magnitude of any decrease in average prices, that charge could be material.

Under the Company’s existing indenture covenants, an impairment will restrict the Company’s ability to issue incremental long-term unsecured indebtedness for a period of time, beginning with the fourth calendar month following the impairment and ending not later than June 13, 2025, the maturity date of the Company’s remaining indebtedness outstanding under its 1974 indenture.

In addition, because an impairment results in a charge to retained earnings, it lowers the Company’s total capitalization, all other things being equal, and increases the Company’s debt to capitalization ratio.

As a result, an impairment can impact the Company’s ability to maintain compliance with the debt to capitalization covenant set forth in its committed credit facility.

The Company recorded a pre-tax impairment under the ceiling test during the quarter ended June 30, 2024 in the amount of $200.7 million, and during the quarter ended September 30, 2024 in the amount of $263.0 million.

Looking ahead, the first day of the month Henry Hub spot price for natural gas in October and

November 2024 was $2.66 per MMBtu and $1.87 per MMBtu, respectively.

Given the October and November prices, and the expected replacement of higher gas prices with lower gas prices in the historical 12-month average that will be used in the ceiling test calculation at December 31, 2024, the Company expects to record a ceiling test impairment for the quarter ending December 31, 2024, and could record additional ceiling test impairments in fiscal 2025.

Although the Company’s committed credit facility’s debt to capitalization covenant excludes 50% of aggregate ceiling test impairments occurring on or after July 1, 2018, up to a total of $400 million, impairments in excess of such amounts can impact the Company’s ability to maintain compliance with this debt to capitalization covenant.

For the fiscal year ended September 30, 2024 and the quarter ended December 31, 2024, the Company recorded pre-tax impairments under the ceiling test of $463.7 million and $108.3 million, respectively.

Depending on a number of factors, including fluctuations in or subtractions from proved reserves, increases in development costs for undeveloped reserves, and significant fluctuations in natural gas prices, the Company may record additional ceiling test impairments in future periods.

OPERATIONAL RISKS

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and other hazards and risks that may cause personal injury, death, property damage, environmental damage or business interruption losses.

Additionally, the Company’s facilities, machinery, equipment, and technology/software systems may be subject to sabotage.

Additionally, the Company’s facilities,

machinery, equipment, and technology/software systems may be subject to sabotage.

These events, in turn, could lead to governmental investigations, recommendations, claims, fines or penalties.

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Our businesses depend on natural gas gathering, storage, and transmission facilities, including third-party midstream facilities that are not within our control.

Our Exploration and Production and Utility segments have entered into long-term agreements with midstream providers for natural gas gathering, storage, and/or transportation services.

Seneca, as well as our Utility segment, have entered into long-term agreements with midstream providers for natural gas gathering, storage, and/or transportation services.

The disruption or unavailability of the midstream facilities required to provide these services, due to maintenance, mechanical failures, accidents, weather, regulatory requirements and/or other operational hazards, could negatively impact our ability to market and/or deliver our products, especially if such disruption were to last for an extended period of time.

In addition, any substantial disruptions to the services provided by our midstream providers could cause us to curtail a significant amount of our production or could impair our ability to deliver natural gas to our utility customers and could have a material adverse effect on the Company’s results of operations, financial condition, and cash flows.

Furthermore, as substantially all of our production is transported from the well pad to interconnections with various FERC-regulated pipelines through our affiliated gathering facilities, such a production curtailment could result in significantly reduced throughput on those facilities, adversely affecting revenues and cash flows of our Gathering segment.

Attacks on or disruption of the Company ’ s information technology and operational technology systems, including third party attempts to breach the Company’s network security, or other cybersecurity threats and incidents could adversely affect the Company ’ s operations and financial results.

The Company relies on information technology and operational technology systems to process, transmit, and store information, to manage and support a variety of business processes and activities, and to comply with regulatory, legal, and tax requirements.

The Company’s information technology and operational technology

systems, some of which are dependent on third party business partners, may be vulnerable to damage, interruption, or shutdown due to any number of causes outside of our control such as catastrophic events, natural disasters, fires, power outages, systems failures, telecommunications failures, and employee error or malfeasance.

The Company’s information technology and operational technology systems, some of which are dependent on third party business partners, may be vulnerable to damage, interruption, or shutdown due to any number of causes outside of our control such as catastrophic events, natural disasters, fires, power outages, systems failures, telecommunications failures, and employee error or malfeasance.

In addition, the Company’s information technology and operational technology systems and those of our third-party business partners are subject to cybersecurity threats and attacks, including attempts by others to gain unauthorized access, or to otherwise introduce malicious software or software vulnerabilities.

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That data may be considered sensitive, confidential, or personal information that is subject to privacy and security laws, regulations and directives.

While the Company employs controls to maintain and protect its information technology and operational technology systems, the Company may be vulnerable to disruptions, cybersecurity incidents, lost or corrupted data, programming errors and employee errors and/or malfeasance that could lead to interruptions to the Company’s business operations or the unauthorized access, use, disclosure, modification or destruction of sensitive, confidential or personal information.

While the Company employs controls to maintain and protect its information technology and operational technology systems, the Company may be vulnerable to disruptions, cybersecurity

incidents, lost or corrupted data, programming errors and employee errors and/or malfeasance that could lead to interruptions to the Company’s business operations or the unauthorized access, use, disclosure, modification or destruction of sensitive, confidential or personal information.

Cybersecurity threats or attempts to breach the Company’s network security may result in disruption of the Company’s business operations and services, delays in production, theft of sensitive and valuable data, damage to our physical systems, malicious alteration or corruption of data or systems, costs related to remediation or the payment of ransom, and litigation including individual claims or consumer class actions, commercial litigation, administrative, and civil or criminal investigations or actions, regulatory intervention and sanctions or fines, investigation and remediation costs and reputational harm.

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There are many risks in developing natural gas, including numerous uncertainties inherent in estimating quantities of proved natural gas reserves and in projecting future rates of production and timing of development expenditures.

The future success of the Company’s Exploration and Production and Gathering segments depends on its ability to develop additional natural gas reserves that are economically recoverable, and its failure to do so may negatively impact the Company’s financial outlook for these businesses.

The future success of the Company’s Integrated Upstream and Gathering segment depends on its ability to develop additional natural gas reserves that are economically recoverable, and its failure to do so may negatively impact the Company’s financial outlook for this segment.

The total and timing of actual future production may vary significantly from reserves and production estimates.

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Drilling for natural gas and related investments in supporting facilities can be unprofitable, not only from non-productive wells, but from productive wells that do not produce sufficient revenues to return a profit.

Also, title problems, competition and cost to acquire mineral

rights, weather conditions, governmental requirements, including completion of environmental impact analyses and compliance with other environmental laws and regulations, and shortages or delays in the delivery of equipment and services can delay drilling operations or result in their cancellation.

Also, title problems, competition and cost to acquire mineral rights, weather conditions, governmental requirements, including completion of environmental impact analyses and compliance with other environmental laws and regulations, and shortages or delays in the delivery of equipment and services can delay drilling operations or result in their cancellation.

The cost of drilling, completing, and operating wells, as well as the development of related exploration and production assets, is significant and often uncertain.

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Production can also be delayed or made uneconomic if there is insufficient gathering and transportation capacity available at an economic price to get that production to a location where it can be profitably sold.

Without continued successful exploitation or acquisition activities, the Company’s reserves and revenues will decline as a result of its current reserves being depleted by production.

Without continued successful exploration or acquisition activities, the Company’s reserves and revenues will decline as a result of its current reserves being depleted by production.

The Company cannot make assurances that it will be able to find or acquire additional reserves at acceptable costs.

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These labor agreements are negotiated periodically, and therefore, the Company is subject to the risk that such agreements may not be able to be renewed on reasonably satisfactory terms, on anticipated timelines, or at all.

For example, the Company is currently negotiating with two collective bargaining units in New York for agreements that expire in February 2025.

In connection with the negotiation of such collective bargaining agreements, or in future matters involving collective bargaining units representing the Company’s workforce, the Company could experience, among other things, strikes, work stoppages, slowdowns or lockouts, which could cause a disruption of the Company’s operations, impact the Company’s ability to fully execute operational plans, and have a material adverse effect on the Company’s results of operations and financial condition.

In connection with the negotiation of such collective bargaining agreements, or in other matters involving collective bargaining units representing the Company’s workforce, the Company could experience, among other things, strikes, work stoppages, slowdowns or lockouts, which could cause a disruption of the Company’s operations, impact the Company’s ability to fully execute operational plans, and have a material adverse effect on the Company’s results of operations and financial condition.

REGULATORY RISKS

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Administrative agencies may apply existing laws and regulations in unanticipated, inconsistent or legally unsupportable ways, making it difficult to develop and complete projects, and harming the economic climate generally.

In addition, judicial decisions limiting the authority of regulatory agencies, or decisions impacting current regulations and policies implemented by such agencies, could create uncertainty regarding the regulatory landscape and impact the Company’s ability to plan for future investments.

In addition, judicial decisions limiting the authority of regulatory agencies, or decisions impacting current regulations and policies

implemented by such agencies, could create uncertainty regarding the regulatory landscape and impact the Company’s ability to plan for future investments.

Various aspects of the Company’s operations are subject to regulation by a variety of federal and state agencies with respect to permitting and environmental requirements.

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The Company’s business operations are subject to federal, state, and local laws, regulations and agency policies relating to environmental protection including obtaining and complying with permits, leases, approvals, consents and certifications from various governmental and permit authorities.

These laws, regulations and policies concern the generation, storage, transportation, disposal, emission or discharge of pollutants,

contaminants, hazardous substances and greenhouse gases into the environment, the reporting of such matters, and the general protection of public health, natural resources, wildlife and the environment.

These laws, regulations and policies concern the generation, storage, transportation, disposal, emission or discharge of pollutants, contaminants, hazardous substances and greenhouse gases into the environment, the reporting of such matters, and the general protection of public health, natural resources, wildlife and the environment.

For example, currently applicable environmental laws and regulations restrict the types, quantities and concentrations of materials that can be released into the environment in connection with regulated activities, limit or prohibit activities in certain protected areas, and may require the Company to investigate and/or remediate contamination at certain current and former properties regardless of whether such contamination resulted from the Company’s actions or whether such actions were in compliance with applicable laws and regulations at the time they were taken.

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Such liabilities could include penalties, sanctions or claims for damages to persons, property or natural resources brought on behalf of the government or private litigants that could cause the Company to incur substantial costs or uninsured losses.

In addition, estimates of the Company’s potential liabilities relating to current or former natural gas and oil properties, including the costs associated with plugging and abandoning wells, may be incorrect, and actual plugging and abandonment expenses may vary substantially from the Company’s estimates.

In addition, estimates of the Company’s potential liabilities relating to current or former natural gas and oil properties, including the costs associated with

plugging and abandoning wells, may be incorrect, and actual plugging and abandonment expenses may vary substantially from the Company’s estimates.

Costs of compliance and liabilities could negatively affect the Company’s results of operations, financial condition and cash flows.

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New permitting fees and/or severance taxes for natural gas production are also possible.

Additionally, legislative initiatives in the U.S.

Congress and environmental and health studies, proceedings or rule-making initiatives at federal, state or local agencies focused on the hydraulic fracturing process, the use of underground injection control wells for produced water disposal, and related operations could result in operational delays or prohibitions and/or additional permitting, compliance, reporting and disclosure requirements, which could lead to increased operating costs and increased risks of litigation for the Company.

Additionally, legislative initiatives and environmental and health studies, proceedings or rule-making initiatives at federal, state or local agencies focused on the hydraulic fracturing process, the use of underground injection control wells for produced water disposal, and related operations could result in operational delays or prohibitions and/or additional permitting, compliance, reporting and disclosure requirements, which could lead to increased operating costs and increased risks of litigation for the Company.

The Company could be adversely affected by the delayed recovery or disallowance of purchased gas costs incurred by the Utility segment.

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Any material delayed recovery or disallowance of purchased natural gas costs could have a material adverse effect on cash flow and earnings.

RISKS RELATED TO OUR PLANNED ACQUISITION OF CENTERPOINT OHIO

Our planned acquisition of CenterPoint Ohio may not occur at all or may not occur in the expected time frame, which may negatively affect the trading price of our stock and our future business and financial results.

Completion of the planned acquisition of CenterPoint Ohio is subject to the satisfaction or waiver of customary and other closing conditions.

The acquisition is not assured and is subject to risks and uncertainties, including the risk that the necessary regulatory approvals will not be obtained or that other closing conditions will not be satisfied.

We cannot predict whether and when such approvals will be received, or such conditions will be satisfied.

The Securities Purchase Agreement includes customary termination rights for both the Company and the Seller, including the right of either party to terminate the agreement if the planned acquisition of CenterPoint Ohio has not been consummated within eighteen months following the execution date of the Securities Purchase Agreement (the “Outside Date”).

The Outside Date may be extended by either party for up

to two additional three-month periods under certain conditions.

Additionally, if the Securities Purchase Agreement is terminated under certain circumstances, including relating to the failure to obtain regulatory approvals in a timely manner, the Company may be required to pay a significant termination fee.

If the planned acquisition of CenterPoint Ohio is not completed, or if there are significant delays in completing the planned acquisition, it may negatively affect the trading price of our stock and our future business and financial results.

The planned acquisition of CenterPoint Ohio may limit our financial flexibility.

We expect to acquire CenterPoint Ohio for total consideration of $2.62 billion, inclusive of the amount to repay a $1.2 billion promissory note.

Although we have obtained committed financing for the entirety of the purchase price, we expect to obtain permanent financing for the planned acquisition by accessing the capital markets, which may include the issuance of long-term debt and equity.

If we are not able to obtain permanent financing on favorable terms, we may be required to finance a portion of the purchase price of the planned acquisition at interest rates higher than currently expected, which could limit our financial flexibility.

In addition, our ability to make payments on our debt, fund our other liquidity needs, and make planned capital expenditures following the planned acquisition of CenterPoint Ohio will depend on our ability to generate cash in the future.

Our ability to generate cash, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory, and other factors that are beyond our control.

The degree to which we will be leveraged following the completion of the planned acquisition could require us to dedicate a substantial portion of our cash flow from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions, and other general corporate purposes.

We may not realize the benefits, including growth opportunities, that are anticipated from the planned acquisition of CenterPoint Ohio.

The benefits that are expected to result from the planned acquisition of CenterPoint Ohio will depend, in part, on our ability to realize the anticipated growth opportunities of the acquired business.

Our success in realizing these growth opportunities, and the timing of this realization, depend on our ability to deploy capital and to obtain timely recovery of capital investments under mechanisms currently supported by Ohio utility regulators and state policymakers.

In addition, realization of these benefits may depend on the successful integration of CenterPoint Ohio with the Company’s current operations.

There can be no assurance that we will successfully or cost-effectively integrate this business, and the Company may incur substantial and unanticipated expenses in connection with the integration of CenterPoint Ohio.

Such expenses are difficult to estimate accurately and may exceed current estimates.

Accordingly, we may not realize the anticipated benefits from the planned acquisition, including growth opportunities, and these benefits may be offset by costs incurred to integrate, or delays in integrating, the businesses.

These items could have a material adverse effect on the Company’s results of operations, financial condition and cash flows.

GENERAL RISKS

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors