8-KLeadership ChangesExhibits & Filings

EQT Corp 8-K Report, Executive Changes (May 20, 2020)

Filed May 20, 2020For Securities:EQT

Summary

EQT Corporation has filed an 8-K report detailing the adoption of a new Executive Severance Plan, effective May 19, 2020. This plan replaces the previous practice of using individual severance agreements with a consolidated, standardized approach for eligible executives. The Compensation Committee views this move as a best practice aimed at enhancing the company's ability to attract and retain critical leadership talent by providing income protection in the event of an involuntary termination without cause. The Severance Plan outlines benefits that are generally consistent with, and in some aspects less favorable than, prior individual agreements. Key provisions include cash severance payments equivalent to one or two times base salary plus average bonuses (higher multiples for the CEO), prorated bonuses for the year of termination, and a COBRA subsidy. Enhanced benefits, including higher severance multiples and accelerated vesting of equity awards, are provided in cases of termination following a Change in Control within a two-year period.

Key Highlights

  • 1EQT Corporation adopted a new Executive Severance Plan, replacing individual executive severance agreements with a standardized plan.
  • 2The plan aims to attract and retain executive talent by providing income protection upon involuntary termination without cause.
  • 3Standard severance includes 1x or 2x base salary + average bonus (CEO gets 2x), prorated bonus, and a COBRA subsidy (duration varies).
  • 4Severance benefits are subject to the executive signing a release of claims and adhering to restrictive covenants.
  • 5Enhanced severance benefits are triggered by termination within two years of a Change in Control, including higher cash multiples (up to 3x for CEO) and accelerated vesting of equity awards.
  • 6The plan incorporates perpetual confidentiality covenants and post-employment non-competition/non-solicitation periods of 12-36 months.

Frequently Asked Questions

The primary purpose of the new Executive Severance Plan is to provide a standardized and consolidated approach to executive severance, replacing individual agreements. It aims to attract and retain key executive talent by offering income protection in cases of involuntary termination without cause and is considered a best practice by the Compensation Committee.

The severance package offers enhanced benefits for the CEO. In the event of a standard termination without cause, the CEO receives a cash severance payment equal to two times their base salary plus average bonuses, whereas other participants receive one times this sum. In the case of a termination following a Change in Control, the CEO's cash severance multiplier increases to three times, compared to two times for other executive officers and one time for all other participants.

To receive severance benefits, an eligible executive must execute and not revoke a release of claims in favor of the Company. They must also continue to comply with certain restrictive covenants, which include perpetual confidentiality and non-competition/non-solicitation obligations for a specified period after termination.

Yes, the severance plan addresses equity awards. For a standard termination, participants are eligible for accelerated vesting of a prorated portion of outstanding time-vesting awards and continued vesting of a prorated portion of performance-vesting awards. In the event of a termination following a Change in Control, all outstanding time-vesting awards will vest immediately, and outstanding performance-vesting awards will continue to vest through the end of their performance periods.