8-KLeadership ChangesAcquisitions & DispositionsMaterial Agreements+2

EQT Corp 8-K Report, Material Agreement (Nov 13, 2018)

Filed November 13, 2018For Securities:EQT

Summary

This 8-K filing from EQT Corporation (EQT) on November 13, 2018, officially announces the completion of the separation of its midstream business from its upstream operations. This separation was achieved through the formation of Equitrans Midstream Corporation (ETRN) and the distribution of approximately 80.1% of ETRN's outstanding shares to EQT shareholders. EQT retains a 19.9% stake in the newly independent ETRN. The filing details the material definitive agreements governing the post-separation relationship between EQT and ETRN, including separation, transition services, tax, employee, and shareholder agreements. Key executive and director appointments are also disclosed, reflecting the organizational adjustments necessary for both independent entities. The filing also confirms the termination of the Omnibus Agreement and outlines new indemnification agreements for directors and officers, ensuring continued protection and coverage. Investors should note the strategic shift for EQT towards a pure-play upstream operator, with ETRN now operating as a separate, publicly traded midstream entity.

Key Highlights

  • 1EQT completed the separation of its midstream assets into a new independent entity, Equitrans Midstream Corporation (ETRN), on November 12, 2018.
  • 2EQT shareholders received 80.1% of ETRN's common stock as a distribution, with EQT retaining the remaining 19.9%.
  • 3The filing outlines several material agreements governing the relationship between EQT and ETRN post-separation, including a Separation and Distribution Agreement and a Transition Services Agreement.
  • 4The Omnibus Agreement between EQT and EQM Midstream Partners, LP (an ETRN predecessor) was terminated in connection with the separation.
  • 5Robert J. McNally has been appointed President and Chief Executive Officer of EQT, and Jimmi Sue Smith has been appointed Senior Vice President and Chief Financial Officer.
  • 6Several new directors have been appointed to EQT's board, including individuals with significant industry and public company experience.
  • 7Amended non-compete agreements are in place for key executives, clarifying terms following the separation and potential competitive activities between EQT and ETRN.

Frequently Asked Questions

The main purpose of this filing is to announce and confirm the completion of EQT Corporation's separation of its midstream business into a newly formed, independent company, Equitrans Midstream Corporation (ETRN). It also details the agreements governing the relationship between the two companies post-separation and announces key leadership and board changes.

EQT shareholders of record as of November 1, 2018, received 0.80 shares of ETRN common stock for every one share of EQT common stock they held. This distribution represented 80.1% of ETRN's outstanding shares.

EQT Corporation retained 19.9% of the outstanding shares of Equitrans Midstream Corporation (ETRN) following the distribution.

The separation allows EQT to become a pure-play upstream energy company, focusing solely on the exploration and production of natural gas and oil. ETRN will operate independently as a dedicated midstream infrastructure company.