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SCHEDULE 14A
Information Required In Proxy Statement
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. 1)
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Kinder Morgan, Inc.
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(Name of Registrant as Specified In Its Charter)
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KINDER MORGAN, INC.
PROXY STATEMENT SUPPLEMENT
FOR ANNUAL MEETING TO BE HELD ON
MAY 8, 2001
This supplements the Proxy Statement dated April 4, 2001 of Kinder
Morgan, Inc., soliciting proxies to be voted at its annual meeting of
stockholders to be held on May 8, 2001.
AUDIT MATTERS
Audit Fees. The aggregate fees billed by Kinder Morgan, Inc.'s
auditors, PricewaterhouseCoopers LLP, for professional services rendered for the
audit of Kinder Morgan, Inc.'s annual financial statements for the year ended
December 31, 2000 and the reviews of the financial statements included in Kinder
Morgan, Inc.'s Forms 10-Q for that fiscal year were $650,000.
Financial Information Systems Design and Implementation Fees. For the
year ended December 31, 2000, PricewaterhouseCoopers LLP did not perform any
services for Kinder Morgan, Inc. relating to financial information systems
design and implementation. Accordingly, Kinder Morgan, Inc. paid
PricewaterhouseCoopers LLP no fees with respect to such services.
All Other Fees. The aggregate fees billed for services rendered by
PricewaterhouseCoopers LLP for the year ended December 31, 2000, other than the
services described above, were $1,089,650. The members of Kinder Morgan, Inc.'s
Audit Committee have considered whether the provision of these services by
PricewaterhouseCoopers LLP was compatible with maintaining the independence of
PricewaterhouseCoopers LLP.
REPORT OF AUDIT COMMITTEE
Kinder Morgan, Inc.'s Audit Committee is comprised of four
"independent" members, as defined under the listing standards of the New York
Stock Exchange, and one additional member that is not considered "independent",
because that member previously served as the Interim Chairman and Chief
Executive Officer of Kinder Morgan, Inc. from July 1999 to October 1999. The
Board of Directors determined to appoint that additional member to the Audit
Committee because of that member's background as a financial consultant and
senior business advisor and the member's tenure with the Board of Directors
since 1993. The Audit Committee acts under a written charter adopted and
approved by the Board of Directors on April 20, 2000. A copy of the Audit
Committee Charter is attached hereto as Appendix A.
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The responsibilities of the Audit Committee include recommending to the
Board of Directors an accounting firm to be engaged as independent accountants.
In addition, the Audit Committee is responsible for recommending to the Board of
Directors that the financial statements be included in the Annual Report to
stockholders.
In keeping with its responsibilities, the Audit Committee has reviewed
and discussed the audited financial statements for the fiscal year ended
December 31, 2000 with management. The Audit Committee has also discussed with
PricewaterhouseCoopers LLP, the independent accountants, the matters required to
be discussed by SAS 61 (Codification of Statements on Auditing Standards, AU
380), as may be modified or supplemented. The Audit Committee has also received
the written disclosures and the letter from PricewaterhouseCoopers LLP required
by Independence Standards Board Standard No. 1 (Independence Standards Board
Standard No. 1, Independence Discussions with Audit Committees), as may be
modified or supplemented, and the Audit Committee has discussed the independence
of PricewaterhouseCoopers LLP with that firm.
Based on the review and discussions described in the above paragraph,
the Audit Committee recommended to the Board of Directors that Kinder Morgan,
Inc.'s audited consolidated financial statements be included in Kinder Morgan,
Inc.'s Annual Report on Form 10-K for the year ended December 31, 2000 for
filing with the Securities and Exchange Commission.
This report is respectfully submitted by the Audit Committee of the
Board of Directors.
Stewart A. Bliss, Chairman
Edward H. Austin
Charles W. Battey
Edward Randall, III
Fayez Sarofim
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APPENDIX A
KINDER MORGAN, INC.
AUDIT COMMITTEE CHARTER
PURPOSE
The primary purpose of the Audit Committee (the "Committee") is to
assist the Board of Directors (the "Board") in fulfilling its responsibility to
oversee management's conduct of the Company's financial reporting process,
including by overviewing the financial reports and other financial information
provided by the Company to any governmental or regulatory body, the public or
other users thereof, the Company's systems of internal accounting and financial
controls, the annual independent audit of the Company's financial statements and
the Company's legal compliance and ethics programs as established by management
and the Board.
In discharging its oversight role, the Committee is empowered to
investigate any matter brought to its attention with full access to all books,
records, facilities and personnel of the Company and the power to retain outside
counsel, auditors or other experts for this purpose. The Board and the Committee
are in place to represent the Company's shareholders; accordingly, the outside
auditor is ultimately accountable to the Board and the Committee.
The Committee shall review the adequacy of this Charter on an annual
basis.
MEMBERSHIP
The Committee shall be comprised of not less than three members of the
Board, and the Committee's composition will meet the requirements of the Audit
Committee Policy of the New York Stock Exchange.
Accordingly, all of the members will be directors:
1. Who have no relationship to the Company that may interfere
with the exercise of their independence from management and
the Company; and
2. Who are financially literate or who become financially
literate within a reasonable period of time after appointment
to the Committee. In addition, at least one member of the
Committee will have accounting or related financial management
expertise.
KEY RESPONSIBILITIES
The Committee's job is one of oversight and it recognizes that the
Company's management is responsible for preparing the Company's financial
statements and that the outside auditors are responsible for auditing those
financial statements. Additionally, the
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Committee recognizes that financial management including the internal audit
staff, as well as the outside auditors, have more time, knowledge and more
detailed information on the Company than do Committee members; consequently, in
carrying out its oversight responsibilities, the Committee is not providing any
expert or special assurance as to the Company's financial statements or any
professional certification as to the outside auditor's work.
The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function. These functions are set forth
as a guide with the understanding that the Committee may diverge from this guide
as appropriate given the circumstances.
o The Committee shall review with management and the outside auditors the
audited financial statements to be included in the Company's Annual
Report on Form 10-K (or the Annual Report to Shareholders if
distributed prior to the filing of Form 10-K) and review and consider
with the outside auditors the matters required to be discussed by
Statement of Auditing Standards ("SAS") No. 61.
o As a whole, or through the Committee chair, the Committee shall review
with the outside auditors the Company's interim financial results to be
included in the Company's quarterly reports to be filed with Securities
and Exchange Commission and the matters required to be discussed by SAS
No. 61; this review will occur prior to the Company's filing of the
Form 10-Q.
o The Committee shall discuss with management and the outside auditors
the quality and adequacy of the Company's internal controls.
o The Committee shall:
- request from the outside auditors annually, a formal written
statement delineating all relationships between the auditor
and the Company consistent with Independence Standards Board
Standard Number 1;
- discuss with the outside auditors any such disclosed
relationships and their impact on the outside auditor's
independence; and
- recommend that the Board take appropriate action in response
to the outside auditor's report to satisfy itself of the
auditor's independence.
o The Committee, subject to any action that may be taken by the full
Board, shall have the ultimate authority and responsibility to select
(or nominate for shareholder approval), evaluate and, where
appropriate, replace the outside auditor.
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