UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): December 8, 2017 (December 7, 2017)
EQT Midstream Partners, LP
(Exact name of registrant as specified in its charter)
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Delaware |
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001-35574 |
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37-1661577 |
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(State or Other Jurisdiction of
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(Commission File
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(I.R.S. Employer Identification No.) |
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625 Liberty Avenue, Suite 1700
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15222 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
Registrant’s telephone number, including area code: ( 412) 553-5700
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 1.01. Entry Into a Material Definitive Agreement.
On December 7, 2017, EQT Corporation (EQT), EQT Gathering, LLC (EQT Gathering), Equitrans, L.P. (Equitrans), EQT Midstream Partners, LP (EQM), and EQT Midstream Services, LLC, the general partner of EQM (the EQM General Partner), entered into a Secondment Agreement (the Secondment Agreement). The Secondment Agreement:
· replaced the existing Amended and Restated Operation and Management Services Agreement, dated as of May 7, 2014, which previously provided for, among other things, the provision by EQT Gathering of certain operation and management services for and on behalf of Equitrans, and the secondment of employees of EQT Gathering, with respect to certain facilities owned by EQM and its subsidiaries;
· provides that EQM will utilize the secondment of available EQT employees under the control of EQM to operate its assets; and
· removed the designation of EQT Gathering as the operator of EQM’s assets and, as a result, the operation of all EQM’s assets are now under the management and direction of EQM.
The foregoing description of the Secondment Agreement is only a summary, and is subject to and qualified in its entirety by reference to the full text of the Secondment Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K, and incorporated herein by reference.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On December 7, 2017, the EQM General Partner entered into Amendment No. 3 (the Amendment) to the First Amended and Restated Agreement of Limited Partnership of EQM, dated as of July 2, 2012, as amended, in response to certain changes to the Internal Revenue Code enacted by the Bipartisan Budget Act of 2015 relating to partnership audit and adjustment procedures.
The foregoing description of the Amendment in this Current Report does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, a copy of which is filed as Exhibit 3.1 to this Current Report on Form 8-K, and is incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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EQT MIDSTREAM PARTNERS, LP |
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By: |
EQT Midstream Services, LLC, |
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its general partner |
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Date: December 8, 2017 |
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/s/ Robert J. McNally |
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Name: |
Robert J. McNally |
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Title: |
Senior Vice President and Chief Financial Officer |
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AMENDMENT NO. 3 TO THE FIRST AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
EQT MIDSTREAM PARTNERS, LP
This Amendment No. 3 (this “ Amendment ”) to the First Amended and Restated Agreement of Limited Partnership of EQT Midstream Partners, LP (the “ Partnership ”), dated as of July 2, 2012 (as previously amended by Amendments No. 1 and No. 2 thereto, the “ Partnership Agreement ”), is hereby adopted effective as of December 7, 2017, by EQT Midstream Services, LLC, a Delaware limited liability company (the “ General Partner ”), as general partner of the Partnership.
RECITALS
WHEREAS , the General Partner desires to replace and restate Section 9.3 (Tax Controversies) and Section 9.4 (Withholding) of the Partnership Agreement in their entirety as a result of amendments made to the Code by the Bipartisan Budget Act of 2015 (the “ BBA ”); and
WHEREAS , pursuant to Section 6.3(c) and Section 9.4 of the Partnership Agreement, the General Partner may treat taxes paid by the Partnership on behalf of, or amounts withheld with respect to, all or less than all of the Partners, as a distribution of Available Cash to such Partners, as determined appropriate under the circumstances by the General Partner; and
WHEREAS , pursuant to Section 9.2(b) of the Partnership Agreement, the General Partner shall determine whether the Partnership should make any other elections permitted by the Code; and
WHEREAS , pursuant to Section 9.3 of the Partnership Agreement, the General Partner is designated as the “tax matters partner” (as defined in Section 6231(a)(7) of the Code) and is authorized and required to represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Partnership funds for professional services and costs associated therewith, and each Partner agrees to cooperate with the General Partner and to do or refrain from doing any or all things reasonably required by the General Partner to conduct such proceedings; and
WHEREAS, Section 13.1(c) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines to be necessary or appropriate to ensure that the Group Members will not be treated as associations taxable as corporations or otherwise taxed as entities for federal income tax purposes; and
WHEREAS, Section 13.1(d)(i) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines does not adversely affect the Limited Partners considered as a whole or any particular class of Partnership Interests as compared to other classes of Partnership Interests in any material respect; and
WHEREAS, Section 13.1(d)(ii)(A) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines is necessary or appropriate to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any federal or state agency or judicial authority or contained in any federal or state statute (including the Delaware Act); and
WHEREAS , Section 13.1(d)(iv) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines is required to effect the intent expressed in the IPO Registration Statement or the intent of the provisions of the Partnership Agreement or is otherwise contemplated by the Partnership Agreement; and
WHEREAS , acting pursuant to the power and authority granted to it under Section 13.1(c) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement is necessary or appropriate to ensure that the Group Members will not be treated as associations taxable as corporations or otherwise taxed as entities for federal income tax purposes; and
WHEREAS, acting pursuant to the power and authority granted to it under Section 13.1(d)(i) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement does not adversely affect the Limited Partners considered as a whole or any particular class of Partnership Interests as compared to other classes of Partnership Interests in any material respect; and
WHEREAS, acting pursuant to the power and authority granted to it under Section 13.1(d)(ii)(A) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement is necessary or appropriate to satisfy certain requirements, conditions or guidelines contained in the Code and the Treasury Regulations promulgated thereunder; and
WHEREAS , acting pursuant to the power and authority granted to it under Section 13.1(d)(iv) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement is required to effect the intent expressed in the IPO Registration Statement or the intent of the provisions of the Partnership Agreement or is otherwise contemplated by the Partnership Agreement.
NOW, THEREFORE, the General Partner does hereby amend the Partnership Agreement as follows:
1. INTERPRETATION
This Amendment is made and delivered pursuant to the Partnership Agreement. Except as otherwise provided herein, capitalized terms used but not defined in this Amendment have the meanings ascribed to them in the Partnership Agreement.
2. AMENDMENTS TO PARTNERSHIP AGREEMENT
2.1 Section 1.1 of the Partnership Agreement is hereby amended by inserting the following definitions alphabetically:
“ BBA ” means the Bipartisan Budget Act of 2015.
“ Imputed Underpayment ” means an imputed underpayment under Section 6225 of the Code, as amended by the BBA.
“ Partnership Representative ” has the meaning set forth in Section 6223 of the Code, as amended by the BBA.
“ Tax Matters Partner ” has the meaning set forth in Section 6231(a)(7) of the Code, prior to amendment by the BBA.
2.2 Section 9.3 of the Partnership Agreement is hereby amended and restated in its entirety as follows:
Section 9.3 Tax Controversies .
(a) For taxable years beginning on or before December 31, 2017, the General Partner is designated as the Tax Matters Partner. For each taxable year beginning after December 31, 2017, the General Partner shall be or shall designate the Partnership Representative and any other Persons necessary to conduct proceedings under Subchapter C of Chapter 63 of the Code (as amended by the BBA) for such year. Any such designated Person or Persons shall serve at the pleasure of, and act at the direction of, the General Partner. The Partnership Representative, as directed by the General Partner, shall exercise any and all authority of the “partnership representative” under the Code (as amended by the BBA), including, without limitation, (i) binding the Partnership and its Partners with respect to actions taken under Subchapter C of Chapter 63 of the Code (as amended by the BBA), and (ii) determining whether to make any available election under Section 6226 of the Code (as amended by the BBA).
(b) The General Partner (acting through the Partnership Representative to the extent permitted by Section 9.3(a)) is authorized and required to act on behalf of and represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and the General Partner is authorized to expend Partnership funds for professional services and costs associated therewith.
(c) Each Partner agrees to cooperate with the General Partner (or its designee) and to do or refrain from doing any or all things reasonably requested by the General Partner (or its designee) in its capacity as the Tax Matters Partner or the Partnership Representative, or as a person otherwise authorized and required to act on behalf of and represent the Partnership pursuant to Section 9.3(b).
(d) The General Partner is authorized to amend the provisions of this Agreement as appropriate to reflect the proposal or promulgation of Treasury Regulations implementing or interpreting the partnership audit, assessment and collection rules adopted by the BBA, including any amendments to those rules.
2.3 Section 9.4 of the Partnership Agreement is hereby amended and restated in its entirety as follows:
Section 9.4 Withholding and other Tax Payments by the Partnership .
(a) If taxes and related interest, penalties or additions to tax are paid by the Partnership on behalf of all or less than all the Partners or former Partners (including, without limitation, any payment by the Partnership of an Imputed Underpayment), the General Partner may treat such payment as a distribution of cash to such Partners, treat such payment as a general expense of the Partnership, or, in the case of an Imputed Underpayment, require that persons who were Partners of the Partnership in the taxable year to which the payment relates (including former Partners) indemnify the Partnership upon request for their allocable share of that payment, in each case as determined appropriate under the circumstances by the General Partner. The amount of any such indemnification obligation of, or deemed distribution of cash to, a Partner or former Partner in respect of an Imputed Underpayment shall be reduced to the extent that the Partnership receives a reduction in the amount of the Imputed Underpayment which, in the determination of the General Partner, is attributable to actions taken by, the tax status or attributes
of, or tax information provided by or attributable to, such Partner or former Partner pursuant to or described in Section 6225(c) of the Code (as amended by the BBA).
(b) Notwithstanding any other provision of this Agreement, the General Partner is authorized to take any action that may be required to cause the Partnership and other Group Members to comply with any withholding requirements established under the Code or any other federal, state or local law including pursuant to Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that the Partnership is required or elects to withhold and pay over to any taxing authority any amount resulting from the allocation or distribution of income or from a distribution to any Partner (including by reason of Section 1446 of the Code), the General Partner may treat the amount withheld as a distribution of cash pursuant to Section 6.3 or Section 12.4(c) in the amount of such withholding from such Partner.
3. GENERAL
3.1 Full Force and Effect. Except to the extent specifically amended herein or supplemented hereby, the Partnership Agreement remains unchanged and in full force and effect, and this Amendment will be governed by and subject to the terms of the Partnership Agreement, as amended by this Amendment.
3.2 Governing Law. This Amendment shall be governed by, and interpreted in accordance with, the laws of the State of Delaware, all rights and remedies being governed by such laws without regard to principles of conflicts of laws.
3.3 Counterparts. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the General Partner has caused this Amendment to be duly executed as of the date first written above.
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GENERAL PARTNER: |
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EQT MIDSTREAM SERVICES, LLC |
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By: |
/s/ Robert J. McNally |
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Name: Robert J. McNally |
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Title: Senior Vice President and Chief Financial Officer |
[Signature Page to Amendment No. 3 to
First Amended and Restated Agreement of Limited Partnership]
Execution Version
SECONDMENT AGREEMENT
This SECONDMENT AGREEMENT (“ Agreement ”) is dated as of December 7, 2017 (the “ Effective Date ”) by and among EQT Corporation, a Pennsylvania corporation (“ EQT ”), EQT Gathering, LLC, a Delaware limited liability company (“ EQT Gathering ”), Equitrans, L.P., a Delaware limited partnership (“ Equitrans ”), EQT Midstream Partners, LP, a Delaware limited partnership (the “ Partnership ”), and EQT Midstream Services, LLC, a Delaware limited liability company and the general partner of the Partnership (“ General Partner ”). EQT, EQT Gathering, Equitrans, the Partnership and the General Partner may be referred to herein individually as “ Party ” or collectively as “ Parties .”
RECITALS
WHEREAS, the Partnership, the General Partner and EQT, are parties to that certain Omnibus Agreement (as amended, the “ Omnibus Agreement ”) dated as of July 2, 2012, which provides for, among other things, the provision by EQT of certain corporate, general and administrative services to the Partnership and its subsidiaries (the “ Partnership Group ”);
WHEREAS, EQT Gathering and Equitrans previously entered into that certain Amended and Restated Operation and Management Services Agreement (the “ Prior Agreement ”) dated as of May 7, 2014, which provides for, among other things, the provision by EQT Gathering of certain operation and management services for and on behalf of Equitrans, and the secondment of employees of EQT Gathering, with respect to natural gas gathering and transmission pipelines, compressors, storage and other related facilities owned by the Partnership Group;
WHEREAS, certain members of the Partnership Group (each an “ Owner ”) own or lease natural gas pipelines, including natural gas gathering and transmission systems, compressors, storage and other related facilities, and water lines and related equipment and facilities; and
WHEREAS, the Parties desire to replace the Prior Agreement with this Agreement.
NOW THEREFORE, in consideration of their mutual undertakings and agreements hereunder, the Parties undertake and agree as follows:
ARTICLE 1
DESCRIPTION OF FACILITIES
1.1 Facilities Description . “ Facilities ” means all facilities, pipelines (including natural gas, natural gas liquid and water pipelines), machinery, measurement equipment and other equipment, accessions and improvements in respect of the foregoing, now or hereafter owned or leased by a member of the Partnership Group, unless EQT and the Partnership determine to exclude any such assets from being subject to this Agreement (such excluded assets being referred to herein as “ Excluded Facilities ”).
ARTICLE 2
SECONDMENT OF EMPLOYEES
2.1 Seconded Employees . Subject to the terms of this Agreement, EQT agrees to second, or cause to be seconded, respectively, those available employees of any of EQT and its affiliates (other than the General Partner, the Partnership and its subsidiaries) (the “ EQT Group ”) for the purpose of providing services (“ Services ”) with respect to the assets of any Owner from time to time (the “ Seconded Employees ”) to such Owner, and such Owner agrees to accept each assignment of any Seconded Employees to the Owner from EQT in accordance with the terms of this Agreement (a “ Secondment ”) for the purpose of performing the Services with respect to the Facilities. The Seconded Employees will remain at all times the employees of the applicable EQT Group member, and, in addition, they will also be temporary co-employees of the applicable Owner during the Period of Secondment (as defined below) and shall, at all times during the Period of Secondment, work under the direction, supervision and control of the Owner related to the Facilities. Seconded Employees shall have no authority or apparent authority to act on behalf of any EQT Group member during the Period of Secondment related to the Facilities. The rights and obligations of the Parties under this Agreement that relate to individuals that were Seconded Employees but then later ceased to be Seconded Employees, which rights and obligations accrued during the Period of Secondment, will survive the removal of such individuals from the group of Seconded Employees to the extent necessary to enforce such rights and obligations.
2.2 Duties and Authority of Seconded Employees . Under the direction of the applicable Owner, the Seconded Employees shall, subject to the terms of this Agreement, perform duties for the operation, maintenance, repair, design, alteration and replacement of the Facilities and of the business processes associated with the Facilities.
ARTICLE 3
TERMS OF SECONDMENT
3.1 Independent Contractor . EQT is an independent contractor and, upon the reasonable request by an Owner and subject to the availability of employees to second, shall second, or cause to be seconded, the Seconded Employees as an independent contractor. Nothing hereunder shall be construed as creating any other relationship among the Parties, including but not limited to a partnership, agency or fiduciary relationship, joint venture, limited liability company, association, or any other enterprise. Except to the extent provided in Section 2.1, none of the Parties or any of their employees shall be deemed to be an employee of another Party.
3.2 Period of Secondment . EQT will second, or cause to be seconded, the Seconded Employees to the applicable Owner starting on the Effective Date and continuing, during the period (and only during the period) that the Seconded Employees are performing Services for such Owner, until the earlier of:
(a) the end of the term of this Agreement;
(b) such end date for any Seconded Employees as may be mutually agreed by EQT and the applicable Owner (the “ End Date ”);
(c) a withdrawal, departure, resignation or termination of such Seconded Employees under Section 3.3; or
(d) a termination of Secondment of such Seconded Employees under Section 3.4.
The period of time that any Seconded Employee is provided by EQT to an Owner is referred to in this Agreement as the “ Period of Secondment .” At the end of the Period of Secondment for any Seconded Employee, such Seconded Employee will no longer be subject to the direction by such Owner of the Seconded Employee’s day-to-day activities. The Parties acknowledge that certain of the Seconded Employees may also provide services to the EQT Group in connection with operations conducted by the EQT Group (“ Shared Seconded Employees ”) and the Parties intend that such Shared Seconded Employees shall only be seconded to the applicable Owner during those times that the Shared Seconded Employees are performing Services for such Owner hereunder.
3.3 Withdrawal, Departure or Resignation . If any Seconded Employee tenders his or her resignation to an applicable EQT Group member, or if the employment of any Seconded Employee is terminated by an applicable EQT Group member, EQT will promptly notify the applicable Owner. During the Period of Secondment of any Seconded Employee, the applicable EQT Group member will not voluntarily withdraw or terminate such Seconded Employee except under Section 3.4 or with the consent of the applicable Owner, which consent shall not be unreasonably withheld, conditioned or delayed.
3.4 Termination of Secondment . Subject to any restrictions contained in any collective bargaining agreement to which an EQT Group member is a party, the applicable Owner will have the right to terminate the Secondment to such Owner of any Seconded Employee for any reason at any time. EQT will not, without the applicable Owner’s express consent, agree to any future amendments to any collective bargaining agreement that would increase the type or degree of any limitations on the Owner’s ability to terminate the Secondment of any Seconded Employee. In addition, any member of the EQT Group shall have the right at any time and from time to time to terminate the Secondment of any Seconded Employee by providing a substitute Seconded Employee. Upon the termination of any Seconded Employee’s Period of Secondment, EQT will be solely liable for any costs or expenses associated with the termination of the Secondment, except as otherwise specifically set forth in this Agreement.
3.5 Supervision . During the Period of Secondment, the applicable Owner shall:
(a) be ultimately and fully responsible for the daily work assignments of the Seconded Employees (and with respect to Shared Seconded Employees, during those times that the Shared Seconded Employees are performing Services for the Owner hereunder), including supervision of their day-to-day work activities and performance consistent with the job functions associated with the Services;
(b) have the right to set the hours of work and the holidays and vacation schedules (other than with respect to Shared Seconded Employees, as to which the Owner and EQT shall jointly determine) for Seconded Employees; and
(c) have the right to determine training which will be received by the Seconded Employees.
The Partnership, for itself and on behalf of each Owner, agrees that with respect to any Seconded Employee who is otherwise represented by a union while working for the EQT Group, the Owner will be assigned the applicable EQT Group member’s rights and responsibilities of any applicable collective bargaining agreement for the Period of Secondment as to any such employee, subject to any changes agreed to between the applicable EQT Group member and any applicable union or as may be allowed by law. The Owner is not, hereby, agreeing to recognize any union or assume any bargaining obligation. Any and all recognition and bargaining obligations, to the extent that they exist, will remain with the applicable EQT Group member.
3.6 Seconded Employees Qualifications; Approval . EQT will provide such suitably qualified and experienced Seconded Employees as EQT is reasonably able to make available to the Partnership, and the applicable Owner will have the right to approve such Seconded Employees. All Seconded Employees identified as of the Effective Date have been approved and accepted by the applicable Owner as suitable for performing job functions related to the Services.
3.7 Workers Compensation . At all times, the EQT Group will maintain workers’ compensation insurance (either through an insurance company or approved self-insurance arrangement) applicable to the Seconded Employees, and will include each Owner as an Alternate Employer under each applicable insurance policy. The Parties agree that a Seconded Employee’s sole remedy for any workplace injury suffered during the Period of Secondment shall be under the workers’ compensation insurance (either through an insurance company or approved self-insurance arrangement) applicable to the Seconded Employees.
3.8 Benefit Plans . No Owner nor any member of the Partnership Group shall be a participating employer in any Benefit Plan (as defined below) during the Period of Secondment. Subject to the applicable Owner’s reimbursement obligations hereunder, the EQT Group shall remain solely responsible for all obligations and liabilities arising under the express terms of the Benefit Plans, and the Seconded Employees will be covered under the Benefit Plans subject to and in accordance with their terms and conditions, as they may be amended from time to time. EQT and its ERISA Affiliates (as defined below) may amend or terminate any Benefit Plan in whole or in part at any time (subject to the applicable provisions of any collective bargaining agreement covering Seconded Employees, if any). During the Period of Secondment, no Owner nor any other member of the Partnership Group shall assume any Benefit Plan or have any obligations, liabilities or rights arising under the express terms of the Benefit Plans, in each case except for cost reimbursement pursuant to this Agreement.
For the purposes of this Section 3.8, “ Benefit Plans ” means each employee benefit plan, as defined in Section 3(3) of ERISA, and any other material plan, policy, program, practice, agreement, understanding or arrangement (whether written or oral) providing compensation or other benefits to any Seconded Employee (or to any dependent or beneficiary thereof), including, without limitation, any stock bonus, stock ownership, stock option, stock purchase, stock appreciation rights, phantom stock, restricted stock or other equity-based compensation plans, policies, programs, practices or arrangements, and any bonus or incentive compensation plan,
deferred compensation, profit sharing, holiday, cafeteria, medical, disability or other employee benefit plan, program, policy, agreement or arrangement sponsored, maintained, or contributed to by the applicable EQT Group member or any entity that would be treated as a single employer with EQT or the EQT Group member under Sections 414(b), (c) or (m) of the Code or Section 4001(b)(1) of ERISA (“ ERISA Affiliates ”), or under which EQT, the EQT Group member, or any ERISA Affiliate may have any obligation or liability, whether actual or contingent, in respect of or for the benefit of any Seconded Employee (but excluding workers’ compensation benefits (whether through insured or self-insured arrangements) and directors and officers liability insurance).
ARTICLE 4
REIMBURSEMENT AND BILLING PROCEDURES
4.1 Reimbursement . Except as provided below in Sections 4.3, 4.4 and 4.5, the applicable Owner shall reimburse EQT for the secondment of the Seconded Employees pursuant to this Agreement in the same manner that the Partnership reimburses EQT pursuant to the reimbursement for services provisions of the Omnibus Agreement (“ Services/Secondment Reimbursement ”).
4.2 Billing Procedures . EQT shall invoice the applicable Owner for the Seconded Employees in accordance with the billing procedures provisions of the Omnibus Agreement.
4.3 Adjustments Based on Period of Secondment . It is understood and agreed that the applicable Owner shall be liable for wages and other costs associated with a Seconded Employee (“ Seconded Employee Expenses ”) to the extent, and only to the extent, they are attributable to the Period of Secondment. As such, if the Period of Secondment begins on other than the first day of a month or ends on other than the last day of a month, the Seconded Employee Expenses for such month shall be prorated based on the number of days during such month that the Period of Secondment was in effect.
4.4 Adjustments for Shared Services . With respect to each Shared Seconded Employee, EQT will determine in good faith the percentage of such Shared Seconded Employee’s time spent providing Services to the applicable Owner (the “ Allocation Percentage ”). For each month during the Period of Secondment, the amount of the Services Reimbursement payable by the applicable Owner with respect to each Shared Seconded Employee shall be calculated by multiplying the Seconded Employee Expenses for such Shared Seconded Employee times the Allocation Percentage for such Shared Seconded Employee; provided, however, that certain Second Employee Expenses shall not be allocated based on the Allocation Percentage but rather shall be allocated as follows:
(a) termination costs with respect to any Shared Seconded Employee shall be allocated between the applicable Owner and the EQT Group based upon the Allocation Percentage, provided that the Owner and EQT or the applicable EQT Group member agree in advance to terminate such Shared Seconded Employee; otherwise, a Party who terminates a Shared Seconded Employee without first consulting with the other Party or applicable affiliate (including an actual or alleged constructive termination) shall be solely responsible for all
termination costs related to such termination, other than any termination costs arising solely out of the gross negligence or willful misconduct of the other Party or applicable affiliate;
(b) travel expenses and other expenses incurred with respect to and/or reimbursable to a Shared Seconded Employee shall be paid by the Party for whom the Shared Seconded Employee was working at the time they were incurred, except that expenses related to activities that benefit both the applicable Owner and the EQT Group (e.g. some types of training) shall be shared by the affected Parties in accordance with the Allocation Percentage (or such other allocation as may be agreed between the affected Parties); and
(c) any sales taxes imposed upon the provision of any taxable Services provided under this Agreement shall be reimbursable in full by the applicable Owner, provided that the Owner and EQT contemplate that the Services provided pursuant to this Agreement are not taxable services for sales and use tax purposes.
ARTICLE 5
TERMINATION
5.1 Termination . This Agreement will terminate automatically upon the termination of the Omnibus Agreement. Upon termination of this Agreement, all rights and obligations of the Parties under this Agreement shall terminate, provided, however , that such termination shall not affect or excuse the performance of any party under the provisions of Article 6 which provisions shall survive the termination of this Agreement indefinitely.
ARTICLE 6
INDEMNITY
6.1 Indemnification Scope . IT IS IN THE BEST INTERESTS OF THE PARTIES THAT CERTAIN RISKS RELATING TO THE MATTERS GOVERNED BY THIS AGREEMENT SHOULD BE IDENTIFIED AND ALLOCATED AS AMONG THEM. IT IS THEREFORE THE INTENT AND PURPOSE OF THIS AGREEMENT TO PROVIDE FOR THE INDEMNITIES SET FORTH HEREIN TO THE MAXIMUM EXTENT ALLOWED BY LAW. ALL PROVISIONS OF THIS ARTICLE SHALL BE DEEMED CONSPICUOUS WHETHER OR NOT CAPITALIZED OR OTHERWISE EMPHASIZED.
6.2 Indemnified Persons . Wherever “EQT” appears as an Indemnitee in this Article, the term shall include that entity, its parents, subsidiaries, affiliates, partners, members, contractors and subcontractors at any tier, and the respective agents, officers, directors, employees, and representatives of the foregoing entities involved in actions or duties to act on behalf of the indemnified party (collectively, the “ EQT Indemnitees ”); provided, that the EQT Indemnitees shall not include the Owners, the General Partner or the Partnership. “Third parties” shall not include any EQT Indemnitees.
6.3 Indemnification . THE OWNERS SHALL RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS THE EQT INDEMNITEES FROM AND AGAINST ANY AND ALL CLAIMS, CAUSES OF ACTION, DEMANDS, LIABILITIES, LOSSES, DAMAGES, FINES, PENALTIES, JUDGMENTS, EXPENSES AND COSTS, INCLUDING REASONABLE ATTORNEYS’ FEES AND COSTS OF INVESTIGATION AND DEFENSE
(EACH, A “ LIABILITY ”) (INCLUDING, WITHOUT LIMITATION, ANY LIABILITY FOR (1) DAMAGE, LOSS OR DESTRUCTION OF THE FACILITIES, (2) BODILY INJURY, ILLNESS OR DEATH OF ANY PERSON, AND (3) LOSS OF OR DAMAGE TO EQUIPMENT OR PROPERTY OF ANY PERSON) ARISING FROM OR RELATING TO THIS AGREEMENT.
6.4 Damages Limitations . Any and all damages recovered by a Party pursuant to this Article 6 or pursuant to any other provision of or actions or omissions under this Agreement shall be limited to actual damages. CONSEQUENTIAL DAMAGES (INCLUDING WITHOUT LIMITATION BUSINESS INTERRUPTIONS AND LOST PROFITS) AND EXEMPLARY AND PUNITIVE DAMAGES SHALL NOT BE RECOVERABLE UNDER ANY CIRCUMSTANCES EXCEPT TO THE EXTENT THOSE DAMAGES ARE INCLUDED IN THIRD PARTY CLAIMS FOR WHICH A PARTY HAS AGREED HEREIN TO INDEMNIFY THE OTHER PARTY. EACH PARTY ACKNOWLEDGES IT IS AWARE THAT IT HAS POTENTIALLY VARIABLE LEGAL RIGHTS UNDER COMMON LAW AND BY STATUTE TO RECOVER CONSEQUENTIAL, EXEMPLARY, AND PUNITIVE DAMAGES UNDER CERTAIN CIRCUMSTANCES, AND EACH OF THE PARTIES NEVERTHELESS WAIVES, RELEASES, RELINQUISHES, AND SURRENDERS RIGHTS TO CONSEQUENTIAL PUNITIVE AND EXEMPLARY DAMAGES TO THE FULLEST EXTENT PERMITTED BY LAW WITH FULL KNOWLEDGE AND AWARENESS OF THE CONSEQUENCES OF THE WAIVER REGARDLESS OF THE NEGLIGENCE OR FAULT OF EITHER PARTY.
6.5 Defense of Claims . The indemnifying Party shall defend, at its sole expense, any claim, demand, loss, liability, damage, or other cause of action within the scope of the indemnifying Party’s indemnification obligations under this Agreement, provided that the indemnified Party notifies the indemnifying Party promptly in writing of any claim, loss, liability, damage, or cause of action against the indemnified Party and gives the indemnifying Party authority, information, and assistance at the reasonable expense of the indemnified Party in defense of the matter. The indemnified Party may be represented by its own counsel (at the indemnified Party’s sole expense) and may participate in any proceeding relating to a claim, loss, liability, damage, or cause of action in which the indemnified Party or both Parties are defendants, provided however, the indemnifying Party shall, at all times, control the defense and any appeal or settlement of any matter for which it has indemnification obligations under this Agreement so long as any such settlement includes an unconditional release of the indemnified Party from all liability arising out of such claim, demand, loss, liability, damage, or other cause of action and does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of the indemnified Party. Should an Owner and EQT both be named as defendants in any third-party claim or cause of action arising out of or relating to the Facilities or Services, the Parties will cooperate with each other in the joint defense of their common interests to the extent permitted by law, and will enter into an agreement for joint defense of the action if the Parties mutually agree that the execution of the same would be beneficial.
ARTICLE 7
NOTICES
A Party may give notices to the other Parties by first class mail postage prepaid, by overnight delivery service, or by facsimile with receipt confirmed at the following addresses or other addresses furnished by a Party by written notice. Any telephone numbers below are solely for information and are not for Agreement notices.
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If to Equitrans, the Partnership or the General Partner to:
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If to EQT to:
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ARTICLE 8
GENERAL
8.1 Succession and Assignment . This Agreement shall be binding upon and inure to the benefit of the Parties named herein. No Party may assign or otherwise transfer either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval of the other Parties, which approval shall not be unreasonably withheld, conditioned or delayed.
8.2 Governing Law . THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES ARISING OUT OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPALS. Jurisdiction and venue shall be in the Court of Common Pleas of Allegheny County, Pennsylvania, or the United States District Court for the Western District of Pennsylvania .
8.3 Non-waiver of Future Default . No waiver of any Party of any one or more defaults by the other in performance of any of the provisions of this Agreement shall operate or be construed as a waiver of any other existing or future default or defaults, whether of a like or different character.
8.4 Audit and Maintenance of Records; Reporting . Notwithstanding the payment by the Owners of any charges, the Owners shall have the right to review and contest the charges. For a period of two years from the end of any calendar year, the Owners shall have the right, upon reasonable notice and at reasonable times, to inspect and audit all the records, books, reports, data and processes related to the Services performed by the Seconded Employees to ensure EQT’s compliance with the terms of this Agreement. If the information is confidential, the parties shall execute a mutually acceptable confidentiality agreement prior to such inspection or audit.
8.5 Entire Agreement; Amendments and Schedules . This Agreement, together with the Omnibus Agreement, constitutes the entire agreement concerning the subject matter among the Parties and shall be amended or waived only by an instrument in writing executed by EQT and the Partnership. Any schedule, annex, or exhibit referenced in the text of this Agreement and attached hereto is by this reference made a part hereof for all purposes. This Agreement shall be deemed to replace and terminate the Prior Agreement in its entirety.
8.6 Counterpart Execution . This Agreement may be executed in any number of counterparts, all of which together shall constitute one agreement binding on the Parties hereto.
8.7 Third Parties . This Agreement is not intended to confer upon any person not a Party, EQT Group member or an Owner any rights or remedies hereunder, and no person other than the Parties, EQT Group members and Owners is entitled to rely on or enforce any representation, warranty or covenant contained herein. The EQT Group members and Owners are intended third-party beneficiaries of this Agreement.
[ Signature Pages Follow ]
The Parties have caused this Agreement to be signed by their duly authorized representatives effective as of the date first written above.
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EQT: |
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EQT CORPORATION |
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By: |
/s/ Steven T. Schlotterbeck |
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Name: |
Steven T. Schlotterbeck |
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Title: |
President and Chief Executive Officer |
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EQT Gathering: |
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EQT GATHERING, LLC |
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By: |
/s/ Jeremiah J. Ashcroft III |
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Name: |
Jeremiah J. Ashcroft III |
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President |
Signature Page to the
Secondment Agreement
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Equitrans: |
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EQUITRANS, L.P. |
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Equitrans Services, LLC, |
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its general partner |
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Equitrans Investments, LLC, |
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its sole member |
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By: |
EQT Midstream Partners, LP, |
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its sole member |
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By: |
EQT Midstream Services, LLC, |
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its general Partner |
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By: |
/s/ Robert J. McNally |
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Name: |
Robert J. McNally |
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Title: |
Senior Vice President and Chief Financial Officer |
Signature Page to the
Secondment Agreement
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Partnership: |
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EQT MIDSTREAM PARTNERS, LP |
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By: |
EQT Midstream Services, LLC |
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its general Partner |
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By: |
/s/ Robert J. McNally |
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Name: |
Robert J. McNally |
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Title: |
Senior Vice President and Chief Financial Officer |
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General Partner: |
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EQT MIDSTREAM SERVICES, LLC |
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By: |
/s/ Robert J. McNally |
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Name: |
Robert J. McNally |
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Title: |
Senior Vice President and Chief Financial Officer |
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Signature Page to the
Secondment Agreement