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82
Gain Contingency – UPRR and Santa Fe Pacific Pipelines (SFPP, a subsidiary of Kinder Morgan
Energy Partners, L.P.) currently are engaged in a proceeding to resolve the fair market rent payable to
UPRR under a 10-year agreement commencing on January 1, 2004 for pipeline easements on UPRR
rights-of-way (Union Pacific Railroad Company vs. Santa Fe Pacific Pipelines, Inc., SFPP, L.P., Kinder
Morgan Operating L.P. “D” Kinder Morgan G.P., Inc., et al., Superior Court of the State of California for
the County of Los Angeles, filed July 28, 2004). In February 2007, a trial began to resolve this issue, and,
on September 28, 2011, the judge issued a tentative Statement of Decision, which concluded that SFPP
owes back rent to UPRR for the years 2004 through 2011. On May 29, 2012, the court entered judgment,
awarding UPRR back rent and prejudgment interest. SFPP is appealing the final judgment. A favorable
final judgment may materially affect our results of operations in the period of any monetary recoveries;
however, due to the uncertainty regarding the amount and timing of any recovery, including the outcome
of SFPP’s appeal of this judgment or any subsequent proceeding, we consider this a gain contingency
and do not reflect any amounts in the Condensed Consolidated Financial Statements as of December 31,
2012.
18. Share Repurchase Program
Effective April 1, 2011, our Board of Directors authorized the repurchase of 40 million shares of our
common stock by March 31, 2014, replacing our previous repurchase program. As of December 31,
2012, we repurchased a total of $7.1 billion of our common stock since the commencement of our
repurchase programs. The table below represents shares repurchased under the new repurchase
program, except for the first quarter of 2011 which represent shares repurchased under the previous
program.
Number of Shares Purchased
A
verage Price Paid
2012 2011 2012 2011
First quarter 3,917,369 2,636,178 $ 110.64 $ 94.10
Second quarter 3,770,528 3,576,399 110.02 100.75
Third quarter 3,098,812 4,681,535 122.13 91.45
Fourth quarter 2,033,750 3,885,658 121.81 98.16
Total 12,820,459 14,779,770 $ 115.01 $ 95.94
Remaining number of shares that may be repurchased under current authority 15,035,949
Management's assessments of market conditions and other pertinent facts guide the timing and volume
of all repurchases. We expect to fund any share repurchases under this program through cash generated
from operations, the sale or lease of various operating and non-operating properties, debt issuances, and
cash on hand. Repurchased shares are recorded in treasury stock at cost, which includes any applicable
commissions and fees.