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):  November 13, 2018 (November 12 , 2018)

 

EQM Midstream Partners, LP

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-35574

 

37-1661577

(State or Other Jurisdiction of
Incorporation or Organization)

 

(Commission File
Number)

 

(I.R.S. Employer Identification No.)

 

625 Liberty Avenue, Suite 2000
Pittsburgh, Pennsylvania

 


15222

(Address of Principal Executive Offices)

 

(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:

 

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

 

 

 


 

Introductory Note.

 

On November 12, 2018, EQT Corporation (EQT) completed the previously announced separation (the Separation) of its upstream and midstream businesses through the pro rata distribution to its shareholders of 80.1% of the outstanding shares of common stock of Equitrans Midstream Corporation (ETRN). To implement the distribution, EQT distributed to its shareholders 0.80 shares of ETRN’s common stock for every one share of EQT common stock outstanding as of the close of business on November 1, 2018, the record date for the distribution.

 

Following the Separation, ETRN became a separate publicly traded company and directly and indirectly holds investments, previously held by EQT, in the entities that conducted EQT’s midstream business, including the following:

 

·                   an approximate 91.3% limited partner interest and the entire non-economic general partner interest in EQGP Holdings, LP (EQGP), which holds (i) 21,811,643 common units of EQM Midstream Partners, LP (EQM), representing an approximate 17.9% limited partner interest in EQM, (ii) 1,443,015 EQM general partner units, representing an approximate 1.2% general partner interest in EQM, and (iii) all of the incentive distribution rights in EQM; and

 

·                   15,433,812 EQM common units, representing an approximate 12.7% limited partner interest in EQM.

 

Item 1.01.                                         Entry into a Material Definitive Agreement.

 

Amended and Restated EQM Omnibus Agreement

 

On November 13, 2018, in connection with the Separation and the Existing EQM Omnibus Agreement Termination (defined below), EQT, EQM and EQM Midstream Services, LLC, the general partner of EQM (the EQM General Partner), entered into an Amended and Restated Omnibus Agreement (the A&R EQM Omnibus Agreement) in order to memorialize the following indemnification or reimbursement obligations of EQM and EQT under the Existing EQM Omnibus Agreement (defined below) which survive the Existing EQM Omnibus Agreement Termination:

 

·                   EQT’s obligation to indemnify or reimburse EQM for losses or expenses relating to or arising from (i) certain plugging and abandonment obligations, (ii) certain bare steel replacement capital expenditures, (iii) certain preclosing tax liabilities, (iv) any claims related to Equitrans, L.P.’s previous ownership of the Big Sandy Pipeline, and (v) any amounts owed to EQM by a third party that has exercised a contractual right of offset against amounts owed by EQT to such third party; and

 

·                   EQM’s obligation to indemnify EQT for losses attributable to (i) the ownership or operation of EQM’s assets, and (ii) any amounts owed to EQT by a third party that has exercised a contractual right of offset against amounts owed by EQM to such third party.

 

Second Amended and Restated RMP Omnibus Agreement

 

On November 13, 2018, in connection with the Separation and the Existing RMP Omnibus Agreement Termination (defined below), EQT, EQT RE, LLC (EQT RE), RM Partners LP (formerly known as Rice Midstream Partners LP, RMP), EQM Midstream Management LLC (formerly known as Rice Midstream Management LLC), and EQM Poseidon Midstream LLC (formerly known as Rice Poseidon Midstream LLC), entered into a Second Amended and Restated Omnibus Agreement (the A&R RMP Omnibus Agreement) in order to memorialize the following indemnification obligations of RMP and its subsidiaries (the RMP Group) and EQT RE under the Existing RMP Omnibus Agreement (defined below) which survive the Existing RMP Omnibus Agreement Termination:

 

·                   EQT RE’s obligation to indemnify the RMP Group for losses or expenses relating to or raising from (i) any event or condition related to the assets owned by EQT and certain of the entities it controls (the EQT Entities) not conveyed to the RMP Group, and (ii) certain preclosing tax liabilities; and

 

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·                   the RMP Group’s obligation to indemnify the EQT Entities for losses attributable to the ownership or operation of the RMP Group’s assets.

 

ETRN Omnibus Agreement

 

On November 13, 2018, in connection with the Separation, ETRN, EQM, and the EQM General Partner entered into an Omnibus Agreement (the ETRN Omnibus Agreement).

 

Pursuant to the ETRN Omnibus Agreement, EQM agreed to provide ETRN with a license to use the name “Equitrans” and related marks in connection with ETRN’s business. The ETRN Omnibus Agreement also provides for certain reimbursement obligations between ETRN and EQM. The ETRN Omnibus Agreement addresses the following matters:

 

·                   EQM’s obligation to reimburse ETRN and its affiliates for certain direct operating expenses and all insurance coverage expenses they incur or pay with respect to EQM’s assets; and

 

·                   EQM’s obligation to reimburse ETRN and its affiliates for providing general and administrative services to EQM, including EQM’s public company expenses and general and administrative expenses.

 

Secondment Agreement

 

On November 13, 2018, in connection with the Separation, ETRN, EQM, and the EQM General Partner entered into a Secondment Agreement (the ETRN Secondment Agreement). The ETRN Secondment Agreement:

 

·                   replaced the existing Secondment Agreement, dated as of December 7, 2017 (the Existing Secondment Agreement), by and among EQT, EQT Gathering, LLC, Equitrans, L.P., EQM, and the EQM General Partner, which previously allowed EQM to utilize the secondment of available EQT employees under the control of EQM to operate its assets;

 

·                   provides that EQM will utilize the secondment of available ETRN employees under the control of EQM to operate its assets; and

 

·                   provides that EQM will reimburse ETRN and its affiliates for the services provided by the seconded employees.

 

The foregoing descriptions of the A&R EQM Omnibus Agreement, the A&R RMP Omnibus Agreement, the ETRN Omnibus Agreement, and the ETRN Secondment Agreement are not complete and are qualified in their entirety by reference to the full text of the A&R EQM Omnibus Agreement, the A&R RMP Omnibus Agreement, the ETRN Omnibus Agreement, and the ETRN Secondment Agreement, copies of which are filed as Exhibits 10.1, 10.2, 10.3, and 10.4, respectively, to this Current Report on Form 8-K, and incorporated herein by reference.

 

Item 1.02.                                         Termination of a Material Definitive Agreement.

 

On November 12, 2018, in connection with the Separation, the following actions were taken to terminate the agreements identified below:

 

Existing EQM Omnibus Agreement

 

EQT terminated (the Existing EQM Omnibus Agreement Termination) that certain Omnibus Agreement, dated July 2, 2012, as amended (the Existing EQM Omnibus Agreement), by and among EQM, the EQM General Partner, and EQT. Certain indemnification or reimbursement obligations of EQM and EQT under the Existing EQM Omnibus Agreement survive the Existing EQM Omnibus Agreement Termination and are memorialized in the A&R EQM Omnibus Agreement as described above in Item 1.01 of this Current Report on Form 8-K.

 

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Existing RMP Omnibus Agreement

 

EQT terminated (the Existing RMP Omnibus Agreement Termination) that certain Amended and Restated Omnibus Agreement, dated November 13, 2017 (the Existing RMP Omnibus Agreement), by and among EQT, EQT RE, RMP, EQM Midstream Management LLC, and EQM Poseidon Midstream LLC. Certain indemnification obligations of the RMP Group and EQT RE under the Existing RMP Omnibus Agreement survive the Existing RMP Omnibus Agreement Termination and are memorialized in the A&R RMP Omnibus Agreement as described above in Item 1.01 of this Current Report on Form 8-K.

 

Existing Secondment Agreement

 

EQT terminated the Existing Secondment Agreement.

 

364-Day Facility

 

EQM terminated all commitments outstanding under that certain 364-Day Uncommitted Revolving Loan Agreement, dated as of October 26, 2016, between EQT and EQM.

 

Item 8.01 .                                         Other Events.

 

As previously announced in Item 5.02 to EQM’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 26, 2018, effective as of the completion of the Separation, Stephen A. Thorington stepped down from the Board of Directors of each of the EQM General Partner and EQGP Services, LLC, the general partner of EQGP.

 

Item 9.01.                                      Financial Statements and Exhibits.

 

(d)                                  Exhibits.

 

EXHIBIT
NUMBER

 

DESCRIPTION

 

 

 

10.1

 

Amended and Restated Omnibus Agreement, dated November 13, 2018, among EQT Corporation, EQM Midstream Partners, LP, and EQM Midstream Services, LLC.

 

 

 

10.2

 

Second Amended and Restated Omnibus Agreement, dated November 13, 2018, among EQT Corporation, RM Partners LP, EQM Midstream Management LLC, and EQM Poseidon Midstream LLC.

 

 

 

10.3

 

Omnibus Agreement, dated November 13, 2018, among Equitrans Midstream Corporation, EQM Midstream Partners, LP, and EQM Midstream Services, LLC.

 

 

 

10.4

 

Secondment Agreement, dated November 13, 2018, by and among Equitrans Midstream Corporation, EQM Midstream Partners, LP, and EQM Midstream Services, LLC.

 

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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.

 

 

EQM MIDSTREAM PARTNERS, LP

 

 

 

By:

EQM Midstream Services, LLC,

 

 

its general partner

 

 

 

 

 

 

Date: November 13, 2018

By:

/s/ Kirk R. Oliver

 

 

Name:

Kirk R. Oliver

 

 

Title:

Senior Vice President and Chief Financial Officer

 

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Exhibit 10.1

 

Execution Version

 

AMENDED AND RESTATED

 

OMNIBUS AGREEMENT

 

among

 

EQT CORPORATION ,

 

EQM MIDSTREAM PARTNERS, LP

 

and

 

EQM MIDSTREAM SERVICES, LLC

 


 

AMENDED AND RESTATED OMNIBUS AGREEMENT

 

This AMENDED AND RESTATED OMNIBUS AGREEMENT (“ Agreement ”) is entered into on, and effective as of, November 13, 2018, among EQT Corporation, a Pennsylvania corporation (“ EQT ”), EQM Midstream Partners, LP, a Delaware limited partnership (the “ Partnership ”), and EQM Midstream Services, LLC, a Delaware limited liability company (the “ General Partner ”).  The above-named entities are sometimes referred to in this Agreement each as a “ Party ” and collectively as the “ Parties .”

 

R E C I T A L S:

 

1.                                       The Parties previously entered into that certain Omnibus Agreement, effective July 2, 2012 (as amended by Amendment No. 1 to Omnibus Agreement, dated March 17, 2015, the “ Original Agreement ”), governing certain indemnification, reimbursement and licensing matters among them;

 

2.                                       Pursuant to Section 6.4 of the Original Agreement, EQT has delivered to the Partnership and the General Partner a notice regarding EQT’s election to terminate the Original Agreement, other than Section 5.3, Article II and Article III thereof, in connection with a Change of Control (as defined in the Original Agreement) related to the proposed spin-off of Equitrans Midstream Corporation (the “ Spin-Off ”) by EQT; and

 

3.                                       In connection with the Spin-Off, the Parties desire to enter into this Agreement in order to amend and restate the Original Agreement as more fully described herein.

 

In consideration of the premises and the covenants, conditions, and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as follows:

 

ARTICLE I
Definitions

 

1.1                                Definitions .  As used in this Agreement, the following terms shall have the respective meanings set forth below:

 

Affiliate ” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the Person in question.

 

Applicable Maintenance Capital Expenditures ” is defined in Section 3.2 .

 

Cause ” is defined in the Partnership Agreement.

 

Closing Date ” means July 2, 2012.

 

Common Units ” is defined in the Partnership Agreement.

 

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Contribution Agreement ” means that certain Contribution, Conveyance and Assumption Agreement, dated as of the Closing Date, among the General Partner, the Partnership, EQT and certain other EQT Entities, together with the additional conveyance documents and instruments contemplated or referenced thereunder.

 

control ,” “ is controlled by ” or “ is under common control with ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise.

 

Covered Environmental Losses ” means any and all Losses (including, without limitation, the costs and expenses associated with any Environmental Activity or of any environmental or toxic tort pre-trial, trial or appellate legal or litigation work) related to or arising out of or in connection with:

 

(a)                                  any violation or correction of a violation of any Environmental Law related to the Partnership Assets; and

 

(b)                                  any event, circumstance, action, omission, condition or matter that has an adverse impact on the environment and is associated with or arising from the ownership or operation of the Partnership Assets (including, without limitation, the presence of Hazardous Substances at, on, under, about or migrating from the Partnership Assets or the exposure to or Release of Hazardous Substances arising out of the operation of Partnership Assets, including at non-Partnership Asset locations).

 

Environmental Activity ” means any investigation, study, assessment, evaluation, sampling, testing, monitoring, containment, removal, disposal, closure, corrective action, remediation (whether active or passive), natural attenuation, restoration, bioremediation, response, repair, cleanup or abatement that is required or necessary under any Environmental Law, including, without limitation, the establishment of institutional or engineering controls and the performance of or participation in a supplemental environmental project in partial or whole mitigation of a fine or penalty.

 

Environmental Laws ” means all federal, state, and local laws, statutes, rules, regulations, orders, ordinances, judgments, codes, injunctions, decrees, Environmental Permits and other legally enforceable requirements and rules of common law relating to (a) pollution or protection of the environment or natural resources, (b) any Release or threatened Release of, or any exposure of any Person or property to, any Hazardous Substance and (c) the generation, manufacture, processing, distribution, use, treatment, storage, transport or handling of any Hazardous Substance, including, without limitation, the federal Comprehensive Environmental Response, Compensation, and Liability Act, the Superfund Amendments Reauthorization Act, the Resource Conservation and Recovery Act, the Clean Air Act, the Federal Water Pollution Control Act, the Toxic Substances Control Act, the Oil Pollution Act, the Safe Drinking Water Act, the Hazardous Materials Transportation Act and other environmental conservation and protection laws, each as amended through and existing on the Closing Date.

 

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Environmental Permits ” means any permit, approval, identification number, license, registration, certification, consent, exemption, variance or other authorization required under or issued pursuant to any applicable Environmental Law.

 

EQT Entities ” means EQT and any Person controlled, directly or indirectly, by EQT other than the General Partner or a member of the Partnership Group; and “ EQT Entity ” means any of the EQT Entities.

 

Equitrans ” means Equitrans, L.P., a Pennsylvania limited partnership.

 

Hazardous Substance ” means (a) any substance that is designated, defined or classified as a hazardous waste, solid waste, hazardous material, pollutant, contaminant or toxic or hazardous substance, or terms of similar meaning, or that is otherwise regulated under any Environmental Law, including, without limitation, any hazardous substance as such term is defined under the Comprehensive Environmental Response, Compensation, and Liability Act, as amended, (b) petroleum, petroleum products, natural gas, crude oil, gasoline, fuel oil, motor oil, waste oil, diesel fuel, jet fuel and other petroleum hydrocarbons, whether refined or unrefined, and (c) radioactive materials, asbestos, whether in a friable or a non-friable condition, and polychlorinated biphenyls.

 

Indemnified Party ” means either one or more members of the Partnership Group or one or more EQT Entities, as the case may be, each in its capacity as a party entitled to indemnification in accordance with Article II hereof.

 

Indemnifying Party ” means either one or more members of the Partnership Group or EQT, as the case may be, each in its capacity as a party from whom indemnification may be required in accordance with Article II hereof.

 

Limited Partner ” is defined in the Partnership Agreement.

 

Losses ” means all losses, damages, liabilities, injuries, claims, demands, causes of action, judgments, settlements, fines, penalties, costs and expenses of any and every kind or character (including, without limitation, court costs and reasonable attorneys’ and experts’ fees).

 

Ongoing Maintenance Capital Expenditures ” means Maintenance Capital Expenditures (as defined in the Partnership Agreement) incurred by the Partnership Group with respect to the Partnership Assets during any applicable period other than those incurred pursuant to the initiatives set forth on Schedule A attached hereto (the “ Pre-Funded Capital Expenditures Initiatives ”) for which the Partnership Group has allocated proceeds of its initial public offering for the funding thereof, as further described in the Partnership’s Registration Statement on Form S-1 (No. 333-179487) (the “ Allocated Proceeds ”); provided , however , that for purposes of Section 3.2 , in the event that the aggregate Maintenance Capital Expenditures incurred with respect to the Partnership Assets pursuant to the Pre-Funded Capital Expenditures Initiatives exceeds the amount of the Allocated Proceeds, such excess Maintenance Capital Expenditures shall be considered “Ongoing Maintenance Capital Expenditures.”

 

Original Agreement ” is defined in the recitals to this Agreement.

 

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Partnership Agreement ” means the First Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of the Closing Date, as such agreement was in effect on the Closing Date, to which reference is hereby made for all purposes of this Agreement.

 

Partnership Assets ” means the assets conveyed, contributed or otherwise transferred, directly or indirectly (including through the transfer of equity interests), or intended to be conveyed, contributed or otherwise transferred, to the Partnership Group pursuant to the Contribution Agreement, including, without limitation, gathering pipelines, transportation pipelines, natural gas storage assets, offices and related equipment and real estate.

 

Partnership Group ” means the Partnership and its Subsidiaries treated as a single consolidated entity.

 

Party ” and “ Parties ” are defined in the introduction to this Agreement.

 

Person ” means an individual or a corporation, firm, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity.

 

Release ” means any depositing, spilling, leaking, pumping, pouring, placing, emitting, discarding, abandoning, emptying, discharging, migrating, injecting, escaping, leaching, dumping or disposing into the environment.

 

Retained Assets ” means the assets and investments owned by Equitrans as of the Closing Date that were not conveyed, contributed or otherwise transferred to the Partnership Group pursuant to the Contribution Agreement; provided, however , that any Retained Asset shall cease to be a Retained Asset upon its conveyance, contribution or transfer to the Partnership Group after July 2, 2012.

 

Spin-Off ” is defined in the recitals to this Agreement.

 

Subsidiary ” means, with respect to any Person, (a) a corporation of which no more than 50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors or other governing body of such corporation is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person or a combination thereof, (b) a partnership (whether general or limited) in which such Person or a Subsidiary of such Person is, at the date of determination, a general or limited partner of such partnership, but only if more than 50% of the partnership interests in such partnership (considering all of the partnership interests of the partnership as a single class) is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person, or a combination thereof, or (c) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such Person.

 

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ARTICLE II
Indemnification

 

2.1                                Additional Indemnification . Subject to the provisions of Sections 2.3 and 2.4 , EQT shall indemnify, defend and hold harmless the Partnership Group from and against any Losses suffered or incurred by the Partnership Group and related to or arising out of or in connection with:

 

(a)                                  any event or condition associated with the Retained Assets, whether occurring before, on or after the Closing Date;

 

(b)                                  any federal, state or local income tax liabilities attributable to the ownership or operation of the Partnership Assets prior to the Closing Date, including (i) any income tax liabilities of EQT that may result from the consummation of the formation transactions for the Partnership Group and (ii) any income tax liabilities arising under Treasury Regulation Section 1.1502-6 and any similar provision of applicable state, local or foreign law, or by contract, as successor, transferee or otherwise, and which income tax liability is attributable to having been a member of any consolidated, combined or unitary group prior to the Closing Date;

 

(c)                                   any claims related to Equitrans’ previous ownership of the Big Sandy Pipeline, including specifically claims arising under the Big Sandy Purchase Agreement and those related to the current dispute with Prater Branch Resources, LLC pursuant to the letter agreement dated September, 2007 between Equitrans and Big Branch Holdings Company, which was assigned to Prater Branch Resources; and

 

(d)                                  any amounts due to any member of the Partnership Group by a third party that has not paid such amounts in reliance on a contractual provision that provides that such third party may offset amounts due to any member of the Partnership Group against amounts owed by an EQT Entity to such third party.

 

2.2                                Indemnification by the Partnership Group .  Subject to the provisions of Sections 2.3 and 2.4 , the Partnership Group shall indemnify, defend and hold harmless the EQT Entities from and against any Losses (including Covered Environmental Losses) suffered or incurred by the EQT Entities and related to or arising out of or in connection with:

 

(a)                                  the ownership or operation of the Partnership Assets after the Closing Date, except to the extent that any member of the Partnership Group is entitled to indemnification hereunder or unless such indemnification would not be permitted under the Partnership Agreement; and

 

(b)                                  any amounts due to any of the EQT Entities by a third party that has not paid such amounts due in reliance on a contractual provision that provides that such third party may offset amounts due to any of the EQT Entities against amounts owed by a member of the Partnership Group to such third party.

 

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2.3                                Limitations Regarding Indemnification .

 

(a)                                  The indemnification obligation set forth in Section 2.1(b)  shall terminate on the 60th day after the termination of any applicable statute of limitations; provided, however , that any such indemnification obligation with respect to a Loss shall survive the time at which it would otherwise expire pursuant to this Section 2.3(a)  if notice of such Loss is properly given to EQT prior to such time.  The indemnification obligations set forth in Sections 2.1(a) , 2.1(c), 2.1(d)  and 2.2 shall survive indefinitely.

 

(b)                                  In no event shall EQT be obligated to the Partnership Group under Section 2.1(b)  or 2.1(c)  for any Losses or income tax liabilities to the extent (i) such Losses or liabilities were reserved for in the Partnership Group’s financial statements as of December 31, 2011, (ii) any insurance proceeds are realized by the Partnership Group, such correlative benefit to be net of any incremental insurance premium that becomes due and payable by the Partnership Group as a result of such claim, (iii) any amounts are recovered by the Partnership Group from third persons, or (iv) any amounts may be recovered from customers under the Partnership Group’s tariff filed with the Federal Energy Regulatory Commission (the “ FERC ”) as determined by the Partnership.

 

2.4                                Indemnification Procedures .

 

(a)                                  The Indemnified Party agrees that promptly after it becomes aware of facts giving rise to a claim for indemnification under this Article II , it will provide notice thereof in writing to the Indemnifying Party, specifying the nature of and specific basis for such claim; provided, however , that the Indemnified Party shall not submit claims more frequently than once a calendar quarter (or twice in the case of the calendar quarter in which the applicable indemnity coverage under this Agreement expires) unless such Indemnified Party believes in good faith that such a delay in notice to the Indemnifying Party would cause actual prejudice to the Indemnifying Party’s ability to defend against the applicable claim.  Notwithstanding anything in this Article II to the contrary, a delay by the Indemnified Party in notifying the Indemnifying Party shall not relieve the Indemnifying Party of its obligations under this Article II , except to the extent that such failure shall have caused actual prejudice to the Indemnifying Party’s ability to defend against the applicable claim.

 

(b)                                  The Indemnifying Party shall have the right to control all aspects of the defense of (and any counterclaims with respect to) any claims brought against the Indemnified Party that are covered by the indemnification under this Article II , including, without limitation, the selection of counsel, the determination of whether to appeal any decision of any court and the settlement of any such matter or any issues relating thereto; provided, however , that no such settlement shall be entered into without the consent of the Indemnified Party unless it includes a full release of the Indemnified Party from such matter or issues, as the case may be, and does not include any admission of fault, culpability or a failure to act, by or on behalf of such Indemnified Party.

 

(c)                                   The Indemnified Party agrees to cooperate fully with the Indemnifying Party with respect to all aspects of the defense of any claims covered by the indemnification under this Article II , including, without limitation, the prompt furnishing to the Indemnifying

 

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Party of any correspondence or other notice relating thereto that the Indemnified Party may receive, permitting the name of the Indemnified Party to be utilized in connection with such defense, the making available to the Indemnifying Party of any files, records or other information of the Indemnified Party that the Indemnifying Party considers relevant to such defense and the making available to the Indemnifying Party, at no cost to the Indemnifying Party, of any employees of the Indemnified Party; provided, however , that in connection therewith the Indemnifying Party agrees to use commercially reasonable efforts to minimize the impact thereof on the operations of the Indemnified Party and further agrees to maintain the confidentiality of all files, records and other information furnished by the Indemnified Party pursuant to this Section 2.4 .  In no event shall the obligation of the Indemnified Party to cooperate with the Indemnifying Party as set forth in the immediately preceding sentence be construed as imposing upon the Indemnified Party an obligation to hire and pay for counsel in connection with the defense of any claims covered by the indemnification set forth in this Article II ; provided, however , that the Indemnified Party may, at its own option, cost and expense, hire and pay for counsel in connection with any such defense.  The Indemnifying Party agrees to keep any such counsel hired by the Indemnified Party informed as to the status of any such defense, but the Indemnifying Party shall have the right to retain sole control over such defense.

 

(d)                                  The date on which the Indemnifying Party receives notification of a claim for indemnification shall determine whether such claim is timely made.

 

(e)                                   NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IN NO EVENT SHALL ANY PARTY’S INDEMNIFICATION OBLIGATION HEREUNDER COVER OR INCLUDE CONSEQUENTIAL, INDIRECT, INCIDENTAL, PUNITIVE, EXEMPLARY, SPECIAL OR SIMILAR DAMAGES OR LOST PROFITS SUFFERED BY ANY OTHER PARTY ENTITLED TO INDEMNIFICATION UNDER THIS AGREEMENT.

 

ARTICLE III
 Reimbursements

 

3.1                                Plugging and Abandonment .  EQT shall reimburse the Partnership for any and all plugging and abandonment expenditures and other expenditures, including but not limited to condemnation proceedings and well reworks, that are reasonably necessary, in the good faith judgment of the Partnership, to protect its storage assets owned on the Closing Date, relating to the wells identified as EQT wells on Schedule B hereto and up to $1.2 million per fiscal year for such expenditures relating to the wells identified as third party wells on Schedule C hereto.

 

3.2                                Bare Steel Replacement .  If Applicable Maintenance Capital Expenditures (as defined below) exceed $17.2 million in any year, then EQT shall reimburse the Partnership for the lesser of (a) the amount of bare steel replacement capital expenditures during such year that were reasonably necessary, in the good faith judgment of the Partnership, and (b) the amount by which such Applicable Maintenance Capital Expenditures exceeds $17.2 million.  As used herein, “Applicable Maintenance Capital Expenditures” shall mean the sum of (i) Ongoing Maintenance Capital Expenditures incurred during the applicable period, less (ii) any plugging and abandonment expenditures and other expenditures incurred by the Partnership Group during the applicable period for which the Partnership Group has been reimbursed pursuant to Section 3.1 hereof, less (iii) any amounts recovered from customers during the applicable period under

 

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the Partnership Group’s tariff filed with the FERC that are associated with the Partnership Assets, as determined by the Partnership.  The aggregate reimbursement obligation of EQT under this Section 3.2 shall not exceed $31.5 million.

 

3.3                                Limitations Regarding Reimbursement .

 

(a)                                  The reimbursement obligations set forth in Sections 3.1 and 3.2 shall terminate on the tenth anniversary of the Closing Date.

 

(b)                                  In no event shall EQT be obligated to the Partnership Group under Sections 3.1 or 3.2 for any reimbursement to the extent (i) such Losses or liabilities were reserved for in the Partnership Group’s financial statements as of December 31, 2011, (ii) any insurance proceeds are realized by the Partnership Group, such correlative benefit to be net of any incremental insurance premium that becomes due and payable by the Partnership Group as a result of such claim, or (iii) any amounts are recovered by the Partnership Group from third persons in respect of such obligations.

 

(c)                                   The Partnership shall take all commercially reasonable actions to mitigate and reduce the amounts subject to reimbursement by EQT pursuant to Sections 3.1 or 3.2 .

 

3.4                                Additional Provisions Related to Reimbursement Obligation .  With respect to EQT’s obligation to reimburse the Partnership for bare steel replacement in accordance with Section 3.2 :

 

(a)                                  Ongoing Maintenance Capital Expenditures for assets owned by the Partnership Group on the Closing Date will be tracked separately from any new builds or acquired assets.

 

(b)                                  All bare steel replacement capital expenditures for the period from January 1, 2012 through the Closing Date shall be excluded from the calculation of the reimbursement set forth in Section 3.2(a)  (but not the calculation of the Applicable Maintenance Capital Expenditures) for the year ending December 31, 2012.

 

(c)                                   All bare steel replacement capital expenditures for the period from the date which is the tenth anniversary of the Closing Date through December 31, 2022 shall be excluded from the calculation of the reimbursement set forth in Section 3.2(a)  (but not the calculation of the Applicable Maintenance Capital Expenditures) for the year ending December 31, 2022.

 

3.5                                Reimbursement Procedures .  The Partnership may request reimbursement pursuant to Sections 3.1 or 3.2 on a quarterly basis based on actual expenditures to date and projections for the applicable period; provided, however , that the final determination of reimbursable amounts under each of Sections 3.1 and 3.2 shall be made at the end of each fiscal year promptly after audited financial statements for the Partnership are available.  If, based upon such audited financial statements and subject to Section 3.3(b) , it is determined that the Partnership received a reimbursement in excess of the amount to which it was entitled pursuant to Sections 3.1 and 3.2 , EQT shall be entitled, at its option, to either a credit for such amount in the following year or a refund.

 

8


 

ARTICLE IV
 Miscellaneous

 

4.1                                Choice of Law; Submission to Jurisdiction .  This Agreement shall be subject to and governed by the laws of the Commonwealth of Pennsylvania, excluding any conflicts-of-law rule or principle that might refer the construction or interpretation of this Agreement to the laws of another state. Each Party hereby submits to the jurisdiction of the state and federal courts in the Commonwealth of Pennsylvania and to venue in the state and federal courts in Allegheny County, Pennsylvania.

 

4.2                                Notice .  All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by depositing same in the United States mail, addressed to the Person to be notified, postage-paid, and registered or certified with return receipt requested or by delivering such notice in person, by overnight delivery service or by facsimile to such Party. Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by facsimile shall be effective upon actual receipt if received during the recipient’s normal business hours or at the beginning of the recipient’s next business day after receipt if not received during the recipient’s normal business hours. All notices to be sent to a Party pursuant to this Agreement shall be sent to or made at the address set forth below or at such other address as such Party may stipulate to the other Parties in the manner provided in this Section 4.2 .

 

If to the EQT Entities:

 

EQT Corporation

625 Liberty, Suite 1700

Pittsburgh, Pennsylvania 15222

Attn:  General Counsel

 

If to the Partnership Group:

 

EQM Midstream Partners, LP

c/o EQM Midstream Services, LLC, its General Partner

625 Liberty Avenue, Suite 2000

Pittsburgh, Pennsylvania  15222

Attn: General Counsel

 

4.3                                Entire Agreement .  This Agreement constitutes the entire agreement of the Parties relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written, relating to the matters contained herein.

 

4.4                                Termination of Agreement .  Notwithstanding any other provision of this Agreement, if the General Partner is removed as general partner of the Partnership under circumstances where (a) Cause does not exist and the Common Units held by the General Partner and its Affiliates are not voted in favor of such removal, or (b) Cause exists, then this Agreement, other than the provisions set forth in Section 4.11 , Article  II and Article III , may at any time thereafter be terminated by EQT by written notice to the other Parties.

 

9


 

4.5                                Amendment or Modification .  This Agreement may be amended or modified from time to time only by the written agreement of all the Parties hereto.  Each such instrument shall be reduced to writing and shall be designated on its face an “Amendment” or an “Addendum” to this Agreement.

 

4.6                                Assignment .  No Party shall have the right to assign its rights or obligations under this Agreement without the consent of the other Parties hereto; provided, however, that the Partnership may make a collateral assignment of this Agreement solely to secure working capital financing for the Partnership.

 

4.7                                Counterparts .  This Agreement may be executed in any number of counterparts with the same effect as if all signatory parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument. Delivery of an executed signature page of this Agreement by facsimile transmission or in portable document format (.pdf) shall be effective as delivery of a manually executed counterpart hereof.

 

4.8                                Severability .  If any provision of this Agreement shall be held invalid or unenforceable by a court or regulatory body of competent jurisdiction, the remainder of this Agreement shall remain in full force and effect.

 

4.9                                Further Assurances .  In connection with this Agreement and all transactions contemplated by this Agreement, each signatory party hereto agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and all such transactions.

 

4.10                         Rights of Limited Partners .  The provisions of this Agreement are enforceable solely by the Parties to this Agreement, and no Limited Partner of the Partnership shall have the right, separate and apart from the Partnership, to enforce any provision of this Agreement or to compel any Party to this Agreement to comply with the terms of this Agreement.

 

4.11                         Use of Name and Marks .  Section 5.3 of the Original Agreement shall survive the termination of the Original Agreement in accordance with its terms and shall apply to this Agreement, mutatis mutandis .

 

[ Signature Page Follows]

 

10


 

IN WITNESS WHEREOF , the Parties have executed this Agreement on, and effective as of, the Closing Date.

 

 

EQT CORPORATION

 

 

 

 

 

 

By:

/s/ Robert J. McNally

 

 

 

 

Name:

Robert J. McNally

 

 

 

 

Title:

Senior Vice President and Chief Financial Officer

 

 

 

 

 

 

EQM MIDSTREAM PARTNERS, LP

 

 

 

 

By:

EQM Midstream Services, LLC, its general partner

 

 

 

 

 

 

 

By:

/s/ Kirk Oliver

 

 

 

 

Name:

Kirk Oliver

 

 

 

 

Title:

Senior Vice President and Chief Financial Officer

 

 

 

 

 

 

 

EQM MIDSTREAM SERVICES, LLC

 

 

 

 

By:

/s/ Kirk Oliver

 

 

 

 

Name:

Kirk Oliver

 

 

 

 

Title:

Senior Vice President and Chief Financial Officer

 

[Signature page to Amended and Restated Omnibus Agreement (EQM)]

 


 

Schedule A

 

Pre-Funded Capital Expenditures Initiatives

 

·                   System segmentation and isolation : Install remote valve operation and pressure monitoring mechanisms on the Partnership’s transmission and storage systems.

 

·                   Valve pit remediation : Program to move valve operators above ground level and to apply coating and corrosion protection to certain equipment.

 


 

Schedule B

 

EQT Wells

 

API #

 

Field

 

State

3700300713

 

Bunola

 

PA

3700390054

 

Bunola

 

PA

3700300714

 

Bunola

 

PA

3700300715

 

Bunola

 

PA

4709100158

 

Comet/Maple Lake

 

WV

4709100162

 

Comet/Maple Lake

 

WV

4709100163

 

Comet/Maple Lake

 

WV

4709100176

 

Comet/Maple Lake

 

WV

4709100153

 

Comet/Maple Lake

 

WV

4709100015

 

Comet/Maple Lake

 

WV

4709100085

 

Comet/Maple Lake

 

WV

3712500688

 

Finleyville

 

PA

3712500691

 

Finleyville

 

PA

3712500670

 

Finleyville

 

PA

3712500667

 

Finleyville

 

PA

3712500668

 

Finleyville

 

PA

3705901368

 

Hunters Cave

 

PA

3705901369

 

Hunters Cave

 

PA

3705901095

 

Hunters Cave

 

PA

3705901094

 

Hunters Cave

 

PA

3705901097

 

Hunters Cave

 

PA

3705901096

 

Hunters Cave

 

PA

4710300254

 

Mobley

 

WV

 

1


 

API #

 

Field

 

State

4710300717

 

Mobley

 

WV

4710300798

 

Mobley

 

WV

4710300802

 

Mobley

 

WV

4710300834

 

Mobley

 

WV

4710300841

 

Mobley

 

WV

4710300865

 

Mobley

 

WV

4710300875

 

Mobley

 

WV

4710300885

 

Mobley

 

WV

3712500701

 

Pratt

 

PA

3705901113

 

Pratt

 

PA

3705901112

 

Pratt

 

PA

3705901056

 

Pratt

 

PA

3705901105

 

Pratt

 

PA

3705901054

 

Pratt

 

PA

3705901058

 

Pratt

 

PA

3705901059

 

Pratt

 

PA

4704100136

 

Rhodes

 

WV

4704101714

 

Rhodes

 

WV

4704103693

 

Rhodes

 

WV

4701730099

 

Shirley

 

WV

4701771545

 

Shirley

 

WV

4709570673

 

Shirley

 

WV

3705901075

 

Swarts

 

PA

3705901090

 

Swarts

 

PA

 

2


 

Schedule C

 

Third Party Wells

 

API #

 

Field

 

State

3700320012

 

Bunola

 

PA

3700300446

 

Bunola

 

PA

3700300787

 

Bunola

 

PA

3700300886

 

Bunola

 

PA

3700301113

 

Bunola

 

PA

3700321991

 

Bunola

 

PA

3712501861

 

Bunola

 

PA

3712501991

 

Bunola

 

PA

4709100145

 

Comet/Maple Lake

 

WV

4709100106

 

Comet/Maple Lake

 

WV

4709100396

 

Comet/Maple Lake

 

WV

4709100399

 

Comet/Maple Lake

 

WV

4709100995

 

Comet/Maple Lake

 

WV

4709100996

 

Comet/Maple Lake

 

WV

4709145003

 

Comet/Maple Lake

 

WV

4709145004

 

Comet/Maple Lake

 

WV

3700300956

 

Finleyville

 

PA

3700300957

 

Finleyville

 

PA

3712501751

 

Finleyville

 

PA

3712501752

 

Finleyville

 

PA

3700321606

 

Finleyville

 

PA

3700321608

 

Finleyville

 

PA

3712500850

 

Finleyville

 

PA

 

1


 

API #

 

Field

 

State

3712502026

 

Finleyville

 

PA

3712502101

 

Finleyville

 

PA

3705990172

 

Hunters Cave

 

PA

3705990188

 

Hunters Cave

 

PA

3705990000

 

Hunters Cave

 

PA

3705990001

 

Hunters Cave

 

PA

4704901016

 

Logansport/Hayes

 

WV

4704970052

 

Logansport/Hayes

 

WV

4704970113

 

Logansport/Hayes

 

WV

4704970212

 

Logansport/Hayes

 

WV

4704970252

 

Logansport/Hayes

 

WV

4704972287

 

Logansport/Hayes

 

WV

4704972289

 

Logansport/Hayes

 

WV

4704972291

 

Logansport/Hayes

 

WV

4704972323

 

Logansport/Hayes

 

WV

4710300033

 

Mobley

 

WV

4710300283

 

Mobley

 

WV

4710300377

 

Mobley

 

WV

4710300976

 

Mobley

 

WV

4710301667

 

Mobley

 

WV

4710301766

 

Mobley

 

WV

4710301767

 

Mobley

 

WV

4710301768

 

Mobley

 

WV

4710301769

 

Mobley

 

WV

4710301785

 

Mobley

 

WV

4710301796

 

Mobley

 

WV

 

2


 

API #

 

Field

 

State

4710301886

 

Mobley

 

WV

4710301962

 

Mobley

 

WV

4710372014

 

Mobley

 

WV

4710372052

 

Mobley

 

WV

3705901206

 

Pratt

 

PA

3705901241

 

Pratt

 

PA

3705901244

 

Pratt

 

PA

3705901245

 

Pratt

 

PA

3705901701

 

Pratt

 

PA

3705901702

 

Pratt

 

PA

3705901714

 

Pratt

 

PA

3705901793

 

Pratt

 

PA

3705901860

 

Pratt

 

PA

3705901938

 

Pratt

 

PA

3705901939

 

Pratt

 

PA

3705901965

 

Pratt

 

PA

3705901966

 

Pratt

 

PA

3705902121

 

Pratt

 

PA

3705902122

 

Pratt

 

PA

3705902123

 

Pratt

 

PA

3705902124

 

Pratt

 

PA

3705902125

 

Pratt

 

PA

3705902126

 

Pratt

 

PA

3705902128

 

Pratt

 

PA

3705902129

 

Pratt

 

PA

3705923586

 

Pratt

 

PA

 

3


 

API #

 

Field

 

State

3705923665

 

Pratt

 

PA

3705924134

 

Pratt

 

PA

3705924135

 

Pratt

 

PA

3705990159

 

Pratt

 

PA

3712501355

 

Pratt

 

PA

3712501904

 

Pratt

 

PA

4704101371

 

Rhodes

 

WV

4704102941

 

Rhodes

 

WV

4704103402

 

Rhodes

 

WV

4704104051

 

Rhodes/Skin Creek

 

WV

4704104138

 

Rhodes

 

WV

4704104616

 

Rhodes

 

WV

4704104687

 

Rhodes

 

WV

4704104718

 

Rhodes

 

WV

4704104971

 

Rhodes

 

WV

4704170057

 

Rhodes

 

WV

4704170426

 

Rhodes

 

WV

4701700607

 

Shirley

 

WV

4701701009

 

Shirley

 

WV

4701704219

 

Shirley

 

WV

4701770355

 

Shirley

 

WV

4701770943

 

Shirley

 

WV

4701771544

 

Shirley

 

WV

4701771549

 

Shirley

 

WV

4701771550

 

Shirley

 

WV

4701771551

 

Shirley

 

WV

 

4


 

API #

 

Field

 

State

4701771552

 

Shirley

 

WV

4701771553

 

Shirley

 

WV

4701771554

 

Shirley

 

WV

4701771555

 

Shirley

 

WV

4709500008

 

Shirley

 

WV

4709501308

 

Shirley

 

WV

4709501445

 

Shirley

 

WV

4709501540

 

Shirley

 

WV

4709501544

 

Shirley

 

WV

4709521562

 

Shirley

 

WV

4709521623

 

Shirley

 

WV

4709521624

 

Shirley

 

WV

4709521684

 

Shirley

 

WV

4709570040

 

Shirley

 

WV

4709570139

 

Shirley

 

WV

4709570214

 

Shirley

 

WV

4709570499

 

Shirley

 

WV

4709570501

 

Shirley

 

WV

4704104018

 

Skin Creek

 

WV

4704104008

 

Skin Creek

 

WV

4704104025

 

Skin Creek

 

WV

3705900634

 

Swarts

 

PA

3705990151

 

Swarts

 

PA

3705990167

 

Swarts

 

PA

3705990171

 

Swarts

 

PA

3705990174

 

Swarts

 

PA

 

5


 

API #

 

Field

 

State

3705990175

 

Swarts

 

PA

3705990178

 

Swarts

 

PA

3700321658

 

Tepe

 

PA

3700321623

 

Tepe

 

PA

3700321755

 

Tepe

 

PA

3700321574

 

Tepe

 

PA

3700321615

 

Tepe

 

PA

3700321674

 

Tepe

 

PA

3700321802

 

Tepe

 

PA

 

6


Exhibit 10.2

 

Execution Version

 

SECOND AMENDED AND RESTATED OMNIBUS AGREEMENT

 

among

 

EQT CORPORATION,

 

EQT RE, LLC,

 

RM PARTNERS LP,

 

EQM MIDSTREAM MANAGEMENT LLC

 

and

 

EQM POSEIDON MIDSTREAM LLC

 

This SECOND AMENDED AND RESTATED OMNIBUS AGREEMENT (“ Agreement ”) is entered into on, and effective as of, November 13, 2018, among EQT Corporation, a Pennsylvania corporation (“ EQT ”), EQT RE, LLC, a Delaware limited liability company (“ EQT RE ”), RM Partners LP (formerly known as Rice Midstream Partners LP), a Delaware limited partnership (the “ Partnership ”), EQM Midstream Management LLC (formerly known as Rice Midstream Management LLC, a Delaware limited liability company and the general partner of the Partnership (the “ General Partner ”), and EQM Poseidon Midstream LLC (formerly known as Rice Poseidon Midstream LLC), a Delaware limited liability company (“ EPM ”). The above-named entities are sometimes referred to in this Agreement each as a “ Party ” and collectively as the “ Parties .”

 

R E C I T A L S:

 

1.                                       Rice Energy Inc. (“ Rice ”), Rice Midstream Holdings LLC (“ RMH ”), the Partnership, the General Partner and EPM entered into that certain Omnibus Agreement, effective as of December 22, 2014 (the “ Original Agreement ”), in order to evidence their understanding with respect to certain indemnification obligations, general and administrative services to be performed for and on behalf of the Partnership Group (as defined herein) and the Partnership’s reimbursement obligations related thereto, the granting of a license from Rice to the Partnership and the Partnership’s right of first offer with respect to certain assets.

 

2.                                       On November 13, 2017, (a) a wholly owned corporate Subsidiary of EQT was merged with and into Rice, with Rice surviving (the “ Surviving Corporation ”) as an indirect, wholly owned Subsidiary of EQT and (b) immediately thereafter, the Surviving Corporation merged with and into EQT RE, with EQT RE surviving as an indirect wholly owned subsidiary of EQT (together, the “ Mergers ”).

 

3.                                       In connection with the Mergers, the Parties amended and restated the Original Agreement (the “ Restated Agreement ”) in its entirety to reflect the effects of the Mergers and to make certain other changes.

 


 

4.                                       On July 23, 2018, EQM Midstream Partners, LP (formerly known as EQT Midstream Partners, LP) (“ EQM ”) completed the acquisition of the Partnership and the General Partner, with each of the Partnership and the General Partner surviving as wholly-owned Subsidiaries of EQM.

 

5.                                       Pursuant to Section 6.6 of the Restated Agreement, EQT and EQT RE have delivered to the Partnership and the General Partner a notice regarding their election to terminate the Restated Agreement, other than Section 4.3, Article II and Article VI thereof, in connection with a Change of Control (as defined in the Restated Agreement) related to the proposed spin-off of Equitrans Midstream Corporation (the “ Spin-Off ”) by EQT.

 

6.                                       In connection with the Spin-Off, the Parties desire to enter into this Agreement in order to amend and restate the Restated Agreement as more fully described herein.

 

In consideration of the premises and the covenants, conditions, and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as follows:

 

ARTICLE I
Definitions

 

1.1                                Definitions . As used in this Agreement, the following terms shall have the respective meanings set forth below:

 

Affiliate ” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the Person in question.

 

Closing Date ” means December 22, 2014.

 

Confidential Information ” means any proprietary or confidential information that is competitively sensitive material or otherwise of value to a Party or its Affiliates and not generally known to the public, including trade secrets, scientific or technical information, design, invention, process, procedure, formula, improvements, product planning information, marketing strategies, financial information, information regarding operations, consumer and/or customer relationships, consumer and/or customer identities and profiles, sales estimates, business plans, and internal performance results relating to the past, present or future business activities of a Party or its Affiliates and the consumers, customers, clients and suppliers of any of the foregoing. Confidential Information includes such information as may be contained in or embodied by documents, substances, engineering and laboratory notebooks, reports, data, specifications, computer source code and object code, flow charts, databases, drawings, pilot plants or demonstration or operating facilities, diagrams, specifications, bills of material, equipment, prototypes and models, and any other tangible manifestation (including data in computer or other digital format) of the foregoing; provided , however , that Confidential Information does not include information that a receiving Party can show (A) has been published or has otherwise become available to the general public as part of the public domain without breach of this Agreement or a duty of confidence, (B) has been furnished or made known to the receiving Party without any obligation to keep it confidential by a third party under circumstances which are not known to the receiving Party to involve a breach

 

2


 

of the third party’s obligations to a Party or (C) was developed independently of information furnished or made available to the receiving Party as contemplated under this Agreement.

 

Contribution Agreement ” means that certain Contribution Agreement, dated as of the Closing Date, among the General Partner, the Partnership, Rice and certain other EQT Entities, together with the additional conveyance documents and instruments contemplated or referenced thereunder.

 

control ,” “ is controlled by ” or “ is under common control with ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise.

 

Covered Environmental Losses ” means any and all Losses (including, without limitation, the costs and expenses associated with any Environmental Activity or of any environmental or toxic tort pre-trial, trial or appellate legal, litigation or arbitration work) related to or arising out of or in connection with:

 

(a)                                  any violation or correction of a violation of any Environmental Law related to the ownership or operation of the Partnership Assets; and

 

(b)                                  any event, circumstance, action, omission, condition or matter that has an adverse impact on the environment and is associated with or arising from the ownership or operation of the Partnership Assets (including, without limitation, the presence of Hazardous Substances at, on, under, about or migrating to or from the Partnership Assets or the exposure to, or disposal or Release of, Hazardous Substances arising out of the operation of Partnership Assets, including at non-Partnership Asset locations).

 

Environmental Activity ” means any investigation, study, assessment, evaluation, sampling, testing, monitoring, containment, removal, disposal, closure, corrective action, remediation (whether active or passive), risk-based closure activities, natural attenuation, restoration, bioremediation, response, repair, cleanup or abatement that is required or necessary under any Environmental Law, including, without limitation, the cost and expense of preparing and implementing any closure, remedial, corrective action, or other plans required or necessary under any Environmental Law, the establishment of institutional or engineering controls and the performance of or participation in a supplemental environmental project in partial or whole mitigation of a fine or penalty.

 

Environmental Laws ” means all federal, state, and local laws, statutes, rules, regulations, orders, ordinances, judgments, codes, injunctions, decrees, Environmental Permits and other legally enforceable requirements and rules of common law relating to (a) pollution or protection of the environment, natural resources or workplace health or safety, (b) any Release or threatened Release of, or any exposure of any Person or property to, any Hazardous Substance and (c) the generation, manufacture, processing, distribution, use, recycling, treatment, storage, transport, handling or disposal of any Hazardous Substance, including, without limitation, the federal Comprehensive Environmental Response, Compensation, and Liability Act, the Superfund Amendments Reauthorization Act, the Resource Conservation and Recovery Act, the Clean Air Act, the Federal Water Pollution Control Act, the Toxic Substances Control Act, the Oil Pollution

 

3


 

Act, the Safe Drinking Water Act, the Hazardous Materials Transportation Act, the Emergency Planning and Community Right-to-Know Act, the Pipeline Safety Improvement Act, the Endangered Species Act, the National Environmental Policy Act, the Occupational Safety and Health Act and other environmental conservation and protection laws, and the regulations promulgated pursuant thereto, and any state or local counterparts, each as amended through and existing on the Closing Date.

 

Environmental Permits ” means any permit, approval, identification number, license, registration, certification, consent, exemption, variance or other authorization required under or issued pursuant to any applicable Environmental Law.

 

EPM ” is defined in the preamble.

 

EQT ” is defined in the preamble.

 

EQT Entities ” means EQT and any Person controlled, directly or indirectly, by EQT, other than the General Partner or any Partnership Group Member; and “ EQT Entity ” means any of the EQT Entities.

 

EQT RE ” is defined in the preamble.

 

General Partner ” is defined in the preamble.

 

Hazardous Substance ” means (a) any substance that is designated, defined or classified as a hazardous waste, solid waste, hazardous material, pollutant, contaminant or toxic or hazardous substance, or terms of similar meaning, or that is otherwise regulated under any Environmental Law, including, without limitation, any hazardous substance as such term is defined under the Comprehensive Environmental Response, Compensation, and Liability Act, as amended, (b) petroleum, petroleum products and fractions or byproducts thereof, natural gas, crude oil, gasoline, fuel oil, motor oil, waste oil, diesel fuel, jet fuel and other petroleum hydrocarbons, whether refined or unrefined, and (c) radioactive materials, asbestos containing materials, radon and polychlorinated biphenyls.

 

Indemnified Party ” means either one or more members of the Partnership Group or one or more EQT Entities, as the case may be, each in its capacity as a party entitled to indemnification in accordance with Article II hereof.

 

Indemnifying Party ” means either one or more members of the Partnership Group or EQT, as the case may be, each in its capacity as a party from whom indemnification may be required in accordance with Article II hereof.

 

Initial Term ” is defined in Section 3.5.

 

Limited Partner ” is defined in the Partnership Agreement.

 

Losses ” means all losses, damages, liabilities, injuries, claims, demands, causes of action, judgments, settlements, fines, penalties, costs and expenses of any and every kind or character (including, without limitation, court costs and reasonable attorneys’ and experts’ fees).

 

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Mediation Notice ” is defined in Section 3.2(b).

 

Mergers ” is defined in the recitals.

 

Original Agreement ” is defined in the recitals.

 

Partnership ” is defined in the preamble.

 

Partnership Agreement ” means the Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of the Closing Date, as such agreement was in effect on the Closing Date, to which reference is hereby made for all purposes of this Agreement.

 

Partnership Assets ” means the assets conveyed, contributed or otherwise transferred, directly or indirectly (including through the transfer of equity interests), or intended to be conveyed, contributed or otherwise transferred, to the Partnership Group pursuant to the Contribution Agreement, including, without limitation, gathering pipelines, offices and related equipment and real estate and fresh water distribution systems.

 

Partnership Group ” means the Partnership and its Subsidiaries treated as a single consolidated entity.

 

Partnership Group Member ” means any member of the Partnership Group.

 

Party ” and “ Parties ” are defined in the preamble.

 

Person ” means an individual or a corporation, firm, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity.

 

Release ” means any depositing, spilling, leaking, pumping, pouring, placing, emitting, discarding, abandoning, emptying, discharging, migrating, injecting, escaping, leaching, dumping or disposing into the environment.

 

Representatives ” is defined in Section 3.1(a).

 

Restated Agreement ” is defined in the recitals.

 

Retained Assets ” means the assets and investments owned by the EQT Entities as of the Closing Date that were not conveyed, contributed or otherwise transferred to the Partnership Group pursuant to the Contribution Agreement; provided, however , that any Retained Asset shall cease to be a Retained Asset upon its conveyance, contribution or transfer to the Partnership Group.

 

Rice ” is defined in the recitals.

 

RMH ” is defined in the recitals.

 

Spin-Off ” is defined in the recitals.

 

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Subsidiary ” means, with respect to any Person, (a) a corporation of which more than 50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors or other governing body of such corporation is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person or a combination thereof, (b) a partnership (whether general or limited) in which such Person or a Subsidiary of such Person is, at the date of determination, a general or limited partner of such partnership, but only if more than 50% of the partnership interests of such partnership (considering all of the partnership interests of the partnership as a single class) is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person, or a combination thereof, or (c) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such Person.

 

Surviving Corporation ” is defined in the recitals.

 

ARTICLE II
Indemnification

 

2.1                                Additional Indemnification . Subject to the provisions of Sections 2.3 and 2.4, EQT RE shall indemnify, defend and hold harmless the Partnership Group from and against any Losses suffered or incurred by the Partnership Group and related to or arising out of or in connection with:

 

(a)                                  any event or condition associated with the Retained Assets, whether occurring before, on or after the Closing Date; and

 

(b)                                  any federal, state or local income tax liabilities attributable to the ownership or operation of the Partnership Assets prior to the Closing Date, including (i) any income tax liabilities of Rice that resulted from the consummation of the formation transactions for the Partnership Group and (ii) any income tax liabilities arising under Treasury Regulation Section 1.1502-6 and any similar provision of applicable state, local or foreign law, or by contract, as successor, transferee or otherwise, and which income tax liability is attributable to having been a member of any consolidated, combined or unitary group prior to the Closing Date.

 

2.2                                Indemnification by the Partnership Group . Subject to the provisions of Sections 2.3 and 2.4, the Partnership Group shall indemnify, defend and hold harmless the EQT Entities from and against any Losses (including Covered Environmental Losses) suffered or incurred by the EQT Entities and related to or arising out of or in connection with the ownership or operation of the Partnership Assets after the Closing Date, except to the extent that any member of the Partnership Group is entitled to indemnification hereunder or unless such indemnification would not be permitted under the Partnership Agreement.

 

2.3                                Limitations Regarding Indemnification .

 

(a)                                  The indemnification obligation set forth in Section 2.2(b) shall terminate on the 30th day after the termination of any applicable statute of limitations; provided, however , that any such indemnification obligation with respect to a Loss shall survive the time at which it would

 

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otherwise expire pursuant to this Section 2.3(a) if notice of such Loss is properly given to EQT RE prior to such time. The indemnification obligations set forth in Sections 2.2(a) and 2.3 shall survive indefinitely.

 

(b)                                  In no event shall EQT RE be obligated to the Partnership Group under Section 2.2 for any Losses or income tax liabilities to the extent (i) any insurance proceeds are realized by the Partnership Group, such correlative benefit to be net of any incremental insurance premium that becomes due and payable by the Partnership Group as a result of such claim or (ii) any amounts are recovered by the Partnership Group from third persons.

 

2.4                                Indemnification Procedures .

 

(a)                                  The Indemnified Party agrees that promptly after it becomes aware of facts giving rise to a claim for indemnification under this Article II, it will provide notice thereof in writing to the Indemnifying Party, specifying the nature of and specific basis for such claim; provided, however , that the Indemnified Party shall not submit claims more frequently than once a calendar quarter (or twice in the case of the calendar quarter in which the applicable indemnity coverage under this Agreement expires) unless such Indemnified Party believes in good faith that such a delay in notice to the Indemnifying Party would cause actual prejudice to the Indemnifying Party’s ability to defend against the applicable claim. Notwithstanding anything in this Article II to the contrary, a delay by the Indemnified Party in notifying the Indemnifying Party shall not relieve the Indemnifying Party of its obligations under this Article II, except to the extent that such failure shall have caused actual prejudice to the Indemnifying Party’s ability to defend against the applicable claim.

 

(b)                                  The Indemnifying Party shall have the right to control all aspects of the defense of (and any counterclaims with respect to) any claims brought against the Indemnified Party that are covered by the indemnification under this Article II, including, without limitation, the selection of counsel, the determination of whether to appeal any decision of any court and the settlement of any such matter or any issues relating thereto; provided, however , that no such settlement shall be entered into without the consent of the Indemnified Party unless it includes a full release of the Indemnified Party from such matter or issues, as the case may be, and does not include any admission of fault, culpability or a failure to act, by or on behalf of such Indemnified Party.

 

(c)                                   The Indemnified Party agrees to cooperate fully with the Indemnifying Party with respect to all aspects of the defense of any claims covered by the indemnification under this Article II, including, without limitation, the prompt furnishing to the Indemnifying Party of any correspondence or other notice relating thereto that the Indemnified Party may receive, permitting the name of the Indemnified Party to be utilized in connection with such defense, the making available to the Indemnifying Party of any files, records or other information of the Indemnified Party that the Indemnifying Party considers relevant to such defense and the making available to the Indemnifying Party, at no cost to the Indemnifying Party, of any employees of the Indemnified Party; provided, however , that in connection therewith the Indemnifying Party agrees to use commercially reasonable efforts to minimize the impact thereof on the operations of the Indemnified Party and further agrees to maintain the confidentiality of all files, records and other information furnished by the Indemnified Party pursuant to this Section 2.4. In no event shall the

 

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obligation of the Indemnified Party to cooperate with the Indemnifying Party as set forth in the immediately preceding sentence be construed as imposing upon the Indemnified Party an obligation to hire and pay for counsel in connection with the defense of any claims covered by the indemnification set forth in this Article II; provided, however , that the Indemnified Party may, at its own option, cost and expense, hire and pay for counsel in connection with any such defense. The Indemnifying Party agrees to keep any such counsel hired by the Indemnified Party informed as to the status of any such defense, but the Indemnifying Party shall have the right to retain sole control over such defense.

 

(d)                                  The date on which the Indemnifying Party receives notification of a claim for indemnification shall determine whether such claim is timely made.

 

(e)                                   NOTWITHSTANDING ANY PROVISION OF THIS AGREEMENT, IN NO EVENT WILL ANY PARTY BE LIABLE TO ANY OTHER PARTY OR INDEMNIFIED PARTY WITH RESPECT TO ANY CLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT FOR ANY LOST OR PROSPECTIVE PROFITS OR ANY OTHER SPECIAL, CONSEQUENTIAL, INCIDENTAL, OR INDIRECT LOSSES OR DAMAGES FROM ITS PERFORMANCE UNDER THIS AGREEMENT OR FOR ANY FAILURE OR PERFORMANCE HEREUNDER OR RELATED HERETO, WHETHER ARISING OUT OF BREACH OF CONTRACT, NEGLIGENCE, TORT, STRICT LIABILITY, OR OTHERWISE, EXCEPT FOR ANY SUCH DAMAGES RECOVERED BY ANY THIRD PARTY AGAINST ANY PARTY IN RESPECT OF WHICH SUCH PARTY WOULD OTHERWISE BE ENTITLED TO INDEMNIFICATION PURSUANT TO THIS ARTICLE II, PROVIDED THAT NO PARTY WILL BE ENTITLED TO INDEMNIFICATION FOR ANY DAMAGES THAT ARE CONTRARY TO APPLICABLE LAW.

 

ARTICLE III
Miscellaneous

 

3.1                                Confidentiality .

 

(a)                                  From and after the Closing Date, each of the Parties shall hold, and shall cause their respective Subsidiaries and Affiliates and its and their directors, officers, employees, agents, consultants, advisors, and other representatives (collectively, “ Representatives ”) to hold all Confidential Information of the other Parties in strict confidence, with at least the same degree of care that applies to such Party’s own confidential and proprietary information and shall not use such Confidential Information except as reasonably necessary for the conduct of its business and shall not release or disclose such Confidential Information to any other Person, except its Representatives or except as required by applicable law. Each Party shall be responsible for any breach of this section by any of its Representatives.

 

(b)                                  If a Party receives a subpoena or other demand for disclosure of Confidential Information received from any other Party or must disclose to a governmental authority any Confidential Information received from such other Party in order to obtain or maintain any required governmental approval, the receiving Party shall, to the extent legally permissible, provide notice to the providing Party before disclosing such Confidential Information. Upon receipt of such notice, the providing Party shall promptly either seek an appropriate

 

8


 

protective order, waive the receiving Party’s confidentiality obligations hereunder to the extent necessary to permit the receiving Party to respond to the demand, or otherwise fully satisfy the subpoena or demand or the requirements of the applicable governmental authority. If the receiving Party is legally compelled to disclose such Confidential Information or if the providing Party does not promptly respond as contemplated by this section, the receiving Party may disclose that portion of Confidential Information covered by the notice or demand.

 

(c)                                   Each Party acknowledges that (i) the disclosing Party would not have an adequate remedy at law for the breach by the receiving Party of any one or more of the covenants contained in this Section 3.1 and (ii) EQT would not have an adequate remedy at law for the breach of any one or more of the covenants of the Partnership Group contained in Article III, and agrees that, in the event of such breach, the disclosing Party or EQT, respectively, may, in addition to the other remedies that may be available to it, apply to a court for an injunction to prevent any further breaches and to enforce specifically the terms and provisions of this Agreement. Notwithstanding any other section hereof, to the extent permitted by applicable law, the provisions of this Section 3.1 and Article III shall survive the expiration or termination of this Agreement.

 

3.2                                Choice of Law; Mediation; Submission to Jurisdiction .

 

(a)                                  This Agreement shall be subject to and governed by the laws of the State of Delaware, excluding any conflicts-of-law rule or principle that might refer the construction or interpretation of this Agreement to the laws of another state. EACH OF THE PARTIES HERETO AGREES THAT THIS AGREEMENT INVOLVES AT LEAST U.S. $100,000.00 AND THAT THIS AGREEMENT HAS BEEN ENTERED INTO IN EXPRESS RELIANCE UPON 6 Del. C. § 2708. EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES (i) TO BE SUBJECT TO THE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND OF THE FEDERAL COURTS SITTING IN THE STATE OF DELAWARE, AND (ii) TO THE EXTENT SUCH PARTY IS NOT OTHERWISE SUBJECT TO SERVICE OF PROCESS IN THE STATE OF DELAWARE, TO APPOINT AND MAINTAIN AN AGENT IN THE STATE OF DELAWARE AS SUCH PARTY’S AGENT FOR ACCEPTANCE OF LEGAL PROCESS AND TO NOTIFY THE OTHER PARTY OF THE NAME AND ADDRESS OF SUCH AGENT.

 

(b)                                  If the Parties cannot resolve any dispute or claim arising under this Agreement, then no earlier than 10 days nor more than 60 days following written notice to the other Parties, any Party may initiate mandatory, non-binding mediation hereunder by giving a notice of mediation (a “ Mediation Notice ”) to the other Parties to the dispute or claim. In connection with any mediation pursuant to this Section 3.2, the mediator shall be jointly appointed by the Parties to the dispute or claim and the mediation shall be conducted in Pittsburgh, Pennsylvania unless otherwise agreed to by the Parties to the dispute or claim. All costs and expenses of the mediator appointed pursuant to this section shall be shared equally by the Parties to the dispute or claim. The then-current Model ADR Procedures for Mediation of Business Disputes of the Center for Public Resources, Inc., either as written or as modified by mutual agreement of the Parties to the dispute or claim, shall govern any mediation pursuant to this section. In the mediation, each Party to the dispute or claim shall be represented by one or more senior representatives who shall have authority to resolve any disputes. If a dispute or claim has not been

 

9


 

resolved within 30 days after the receipt of the Mediation Notice by a Party, then any Party to the dispute or claim may refer the resolution of the dispute or claim to litigation.

 

(c)                                   Subject to Section 3.2(b), each Party agrees that it shall bring any action or proceeding in respect of any claim arising out of or related to this Agreement, whether in tort or contract or at law or in equity, exclusively in any federal or state courts located in Delaware and (i) irrevocably submits to the exclusive jurisdiction of such courts, (ii) waives any objection to laying venue in any such action or proceeding in such courts, (iii) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over it and (iv) agrees that, to the fullest extent permitted by law, service of process upon it may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to it at its address specified in Section 3.3. The foregoing consents to jurisdiction and service of process shall not constitute general consents to service of process in the State of Delaware for any purpose except as provided herein and shall not be deemed to confer rights on any Person other than the Parties.

 

3.3                                Notice . All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by depositing same in the United States mail, addressed to the Person to be notified, postage-paid, and registered or certified with return receipt requested or by delivering such notice in person, by overnight delivery service or by facsimile to such Party. Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by facsimile shall be effective upon actual receipt if received during the recipient’s normal business hours or at the beginning of the recipient’s next business day after receipt if not received during the recipient’s normal business hours. All notices to be sent to a Party pursuant to this Agreement shall be sent to or made at the address set forth below or at such other address as such Party may stipulate to the other Parties in the manner provided in this Section 3.3.

 

If to the EQT Entities:

 

EQT Corporation

EQT Plaza

625 Liberty Avenue, Suite 1700

Pittsburgh, PA 15222

Attention: General Counsel

 

with a copy (which will not constitute notice) to:

 

Baker Botts L.L.P.

30 Rockefeller Plaza

New York, NY 10112

Attention: Michael L. Bengtson

Facsimile: (212) 259-2504

 

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If to the Partnership Group:

 

RM Partners LP

c/o EQM Midstream Management LLC, its General Partner

625 Liberty Avenue, Suite 2000

Pittsburgh, PA 15222

Attention: General Counsel

 

with a copy (which will not constitute notice) to:

 

Baker Botts L.L.P.

30 Rockefeller Plaza

New York, NY 10112

Attention: Michael L. Bengtson

Facsimile: (212) 259-2504

 

3.4                                Entire Agreement . This Agreement, together with the Partnership Agreement, constitute the entire agreement of the Parties relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written, relating to the matters contained herein.

 

3.5                                Term . The initial term of this Agreement will be for a period of ten years, commencing on the Closing Date and ending on the tenth anniversary of the Closing Date (“ Initial Term ”). At the conclusion of the Initial Term, this Agreement will automatically extend from year-to-year, unless terminated by the Partnership or the General Partner with at least 90 days’ notice prior to the end of such term, as extended.

 

3.6                                Amendment or Modification . This Agreement may be amended or modified from time to time only by the written agreement of all the Parties hereto. Each such instrument shall be reduced to writing and shall be designated on its face an “Amendment” or an “Addendum” to this Agreement.

 

3.7                                Assignment . No Party shall have the right to assign its rights or obligations under this Agreement without the consent of the other Parties hereto.

 

3.8                                Counterparts . This Agreement may be executed in any number of counterparts with the same effect as if all signatory parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument. Delivery of an executed signature page of this Agreement by facsimile transmission or in portable document format (.pdf) shall be effective as delivery of a manually executed counterpart hereof.

 

3.9                                Severability . If any provision of this Agreement shall be held invalid or unenforceable by a court or regulatory body of competent jurisdiction, the remainder of this Agreement shall remain in full force and effect.

 

3.10                         Further Assurances . In connection with this Agreement and all transactions contemplated by this Agreement, each signatory party hereto agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or

 

11


 

appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and all such transactions.

 

3.11                         Rights of Limited Partners . The provisions of this Agreement are enforceable solely by the Parties to this Agreement, and no Limited Partner of the Partnership shall have the right, separate and apart from the Partnership, to enforce any provision of this Agreement or to compel any Party to this Agreement to comply with the terms of this Agreement.

 

3.12                         Use of Name and Marks .  Section 4.3 of the Restated Agreement shall survive the termination of the Original Agreement in accordance with its terms and shall apply to this Agreement, mutatis mutandis .

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF , the Parties have executed this Agreement on, and effective as of, the date first set forth above.

 

 

 

EQT CORPORATION

 

 

 

 

By:

/s/ Robert J. McNally

 

Name:

Robert J. McNally

 

Title:

Senior Vice President and Chief Financial Officer

 

 

 

 

EQT RE, LLC

 

 

 

 

By:

/s/ David E. Schlosser, Jr.

 

Name:

David E. Schlosser, Jr.

 

Title:

President

 

 

 

 

EQM MIDSTREAM MANAGEMENT LLC

 

 

 

 

By:

/s/ Thomas F. Karam

 

Name:

Thomas F. Karam

 

Title:

President

 

 

 

 

RM PARTNERS LP

 

 

 

 

By:

EQM Midstream Management LLC, its general partner

 

 

 

 

By:

/s/ Thomas F. Karam

 

Name:

Thomas F. Karam

 

Title:

President

 

 

 

 

EQM POSEIDON MIDSTREAM LLC

 

 

 

 

By:

/s/ Thomas F. Karam

 

Name:

Thomas F. Karam

 

Title:

President

 

[ Signature Page to Second Amended and Restated Omnibus Agreement (RMP) ]

 


Exhibit 10.3

 

Execution Version

 

OMNIBUS AGREEMENT

 

among

 

EQUITRANS MIDSTREAM CORPORATION ,

 

EQM MIDSTREAM PARTNERS, LP

 

and

 

EQM MIDSTREAM SERVICES, LLC

 


 

OMNIBUS AGREEMENT

 

This OMNIBUS AGREEMENT (“ Agreement ”) is entered into on, and effective as of, the Closing Date (as defined herein) among Equitrans Midstream Corporation, a Pennsylvania corporation (“ ETRN ”), EQM Midstream Partners, LP, a Delaware limited partnership (the “ Partnership ”), and EQM Midstream Services, LLC, a Delaware limited liability company (the “ General Partner ”).  The above-named entities are sometimes referred to in this Agreement each as a “ Party ” and collectively as the “ Parties .”

 

RECITALS

 

WHEREAS, the Parties desire by their execution of this Agreement to evidence their understanding, as more fully set forth in Article II , with respect to certain general and administrative services to be performed by the ETRN Entities (as defined herein) for and on behalf of the Partnership Group (as defined herein) and the Partnership’s reimbursement obligations related thereto; and

 

WHEREAS, the Parties desire by their execution of this Agreement to evidence their understanding, as is more fully set forth in Article III , with respect to the granting of a license from the Partnership to the ETRN Entities and the Partnership Entities (other than the Partnership).

 

NOW THEREFORE, in consideration of the premises and the covenants, conditions, and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

 

ARTICLE I
DEFINITIONS

 

1.1                                Definitions .  As used in this Agreement, the following terms shall have the respective meanings set forth below:

 

Affiliate ” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the Person in question. For the avoidance of doubt, neither EQT Corporation nor any of its Subsidiaries shall be deemed to be “Affiliates” of ETRN, the Partnership, the General Partner, EQGP or the EQGP General Partner.

 

Agreement ” is defined in the preamble.

 

Cause ” is defined in the Partnership Agreement.

 

Change of Control ” means, with respect to any Person (the “ Applicable Person ”), any of the following events: (i) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the Applicable Person’s assets to any other Person, unless immediately following such sale, lease, exchange or other transfer such assets are owned, directly or indirectly, by the Applicable Person or such Applicable Person owns or controls such other Person; (ii) the dissolution or liquidation of the

 

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Applicable Person; (iii) the consolidation or merger of the Applicable Person with or into another Person, other than any such transaction where (a) the outstanding Voting Securities of the Applicable Person are changed into or exchanged for Voting Securities of the surviving Person or its parent and (b) the holders of the Voting Securities of the Applicable Person immediately prior to such transaction own, directly or indirectly, not less than a majority of the outstanding Voting Securities of the surviving Person or its parent immediately after such transaction; and (iv) a “person” or “group” (within the meaning of Sections 13(d) or 14(d)(2) of the Exchange Act), other than ETRN or its Affiliates, being or becoming the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more than 50% of all of the then outstanding Voting Securities of the Applicable Person, except in a merger or consolidation that would not constitute a Change of Control under clause (iii) above.

 

Closing Date ” means November 13, 2018.

 

Common Units ” is defined in the Partnership Agreement.

 

Conflicts Committee ” is defined in the Partnership Agreement.

 

control ,” “ is controlled by ” or “ is under common control with ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise.

 

EQGP ” means EQGP Holdings, LP, a Delaware limited partnership.

 

EQGP General Partner ” means EQGP Services, LLC, a Delaware limited liability company.

 

ETRN ” is defined in the preamble.

 

ETRN Entities ” means ETRN and any Person controlled, directly or indirectly, by ETRN other than the General Partner, EQGP, the EQGP General Partner, or a member of the Partnership Group; and “ ETRN Entity ” means any of the ETRN Entities.

 

Exchange Act ” means the Securities Exchange Act of 1934, as amended.

 

G&A Services ” is defined in Section 2.1 .

 

General Partner ” is defined in the preamble.

 

License ” is defined in Section 3.1 .

 

Limited Partner ” is defined in the Partnership Agreement.

 

Marks ” is defined in Section 3.1 .

 

Name ” is defined in Section 3.1 .

 

Partnership ” is defined in the preamble.

 

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Partnership Agreement ” means the Second Amended and Restated Agreement of Limited Partnership of EQM Midstream Partners, LP, dated as of the Closing Date, as such agreement may be further amended from time to time, to which reference is hereby made for all purposes of this Agreement.

 

Partnership Assets ” means all of the assets of the Partnership Group from time to time, including, without limitation, gathering pipelines, transportation pipelines, water pipelines, natural gas storage assets, related facilities, offices and related equipment and real estate.

 

Partnership Group ” means the Partnership and its Subsidiaries treated as a single consolidated entity.

 

Partnership Entities ” means the General Partner and each member of the Partnership Group.

 

Party ” and “ Parties ” are defined in the preamble.

 

Person ” means an individual or a corporation, firm, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity.

 

Secondment Agreement ” is defined in Section 2.2 .

 

Service Provider ” is defined in Section 2.4 .

 

Subsidiary ” means, with respect to any Person, (a) a corporation of which more than 50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors or other governing body of such corporation is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person or a combination thereof, (b) a partnership (whether general or limited) in which such Person or a Subsidiary of such Person is, at the date of determination, a general or limited partner of such partnership, but only if more than 50% of the partnership interests of such partnership (considering all of the partnership interests of the partnership as a single class) is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person, or a combination thereof, or (c) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such Person.

 

Voting Securities ” of a Person means securities of any class of such Person entitling the holders thereof to vote in the election of, or to appoint, members of the board of directors or other similar governing body of the Person.

 

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ARTICLE II
SERVICES

 

2.1                                Agreement to Provide General and Administrative Services .  Until such time as this Agreement is terminated as provided in Section 4.4 , ETRN hereby agrees to cause the ETRN Entities to provide the Partnership Group with certain centralized corporate, general and administrative services, such as accounting, audit, billing, business development, corporate record keeping, treasury services, cash management and banking, real property/land, legal, engineering, planning, budgeting, geology/geophysics, investor relations, risk management, information technology, insurance administration and claims processing, regulatory compliance and government relations, tax, payroll, human resources and environmental, health and safety, including without limitation permit filing, support for permit filing and maintenance (collectively, the “ G&A Services ”).  ETRN shall, and shall cause the ETRN Entities to, use commercially reasonable efforts to provide the Partnership Group with such G&A Services in a manner materially consistent in nature and quality to the services of such type previously provided by EQT Corporation and its Affiliates in connection with the Partnership Assets prior to the Closing Date.

 

2.2                                Secondment .  Pursuant to a Secondment Agreement, dated as of the Closing Date (the “ Secondment Agreement ”), ETRN has agreed to second, or cause to be seconded, to certain members of the Partnership Group available employees of the ETRN Entities for the purpose of providing certain services to such members of the Partnership Group relating to their respective assets, as set forth in, and subject to all terms and conditions of, the Secondment Agreement.

 

2.3                                Reimbursement by Partnership .  Subject to and in accordance with the terms and provisions of this Article II and such reasonable allocation and other procedures as may be agreed upon by ETRN and the General Partner from time to time, the Partnership hereby agrees to reimburse ETRN for all direct and indirect costs and expenses incurred by ETRN Entities in connection with the provision of the G&A Services to the Partnership Group, including the following:

 

(a)                                  any payments or expenses incurred for insurance coverage, including allocable portions of premiums, and negotiated instruments (including surety bonds and performance bonds) provided by underwriters with respect to the Partnership Assets or the business of the Partnership Group;

 

(b)                                  salaries and related benefits and expenses of personnel employed by the ETRN Entities who render G&A Services to the Partnership Group, plus general and administrative expenses associated with such personnel, including long-term incentive programs; it being agreed that such allocation shall include any withholding and payroll related taxes paid by ETRN or its Affiliates in connection with any long-term incentive plan of the General Partner or the Partnership Group;

 

(c)                                   any taxes or other direct operating expenses paid by the ETRN Entities for the benefit of the Partnership Group (including any state income, franchise or similar tax paid by the ETRN Entities resulting from the inclusion of the Partnership Group in a combined or consolidated state income, franchise or similar tax report with ETRN as required by applicable

 

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law as opposed to the flow through of income attributable to the ETRN Entities’ ownership interest in the Partnership Group), provided, however , that the amount of any such reimbursement shall be limited to the tax that the Partnership Group would have paid had it not been included in a combined or consolidated group with ETRN; and

 

(d)                                  all expenses and expenditures incurred by the ETRN Entities as a result of the Partnership being a publicly traded entity, including costs associated with annual and quarterly reports, tax return and Schedule K-1 preparation and distribution, independent auditor fees, partnership governance and compliance expenses, registrar and transfer agent fees, legal fees and independent director compensation;

 

it being agreed, however, that to the extent any reimbursable costs or expenses incurred by the ETRN Entities consist of an allocated portion of costs and expenses incurred by the ETRN Entities for the benefit of both the Partnership Group and the other ETRN Entities, such allocation shall be made on a reasonable cost reimbursement basis as determined by ETRN.

 

2.4                                Billing Procedures .  The Partnership will reimburse ETRN, or the ETRN Entities providing the G&A Services, as applicable (the “ Service Provider ”), for billed costs no later than the later of (a) the last day of the month following the performance month, or (b) thirty (30) business days following the date of the Service Provider’s billing to the Partnership.  Billings and payments may be accomplished by inter-company accounting procedures and transfers. The Partnership shall have the right to review all source documentation concerning the liabilities, costs, and expenses upon reasonable notice and during regular business hours.

 

ARTICLE III
LICENSE OF NAME AND MARK

 

3.1                                Grant of License .  Upon the terms and conditions set forth in this Article III , the Partnership hereby grants and conveys to each ETRN Entity and each Partnership Entity a nontransferable, nonexclusive, royalty-free right and license (“ License ”) to use the name “Equitrans” (the “ Name ”) and any other trademarks owned by the Partnership which contain the Name (collectively, the “ Marks ”).

 

3.2                                Ownership and Quality .

 

(a)                                  ETRN agrees that ownership of the Name and the Marks and the goodwill relating thereto shall remain vested in the Partnership, the owner of the mark, and any successor thereto, both during the term of this License and thereafter, and ETRN further agrees, and agrees to cause the ETRN Entities and Partnership Entities never to challenge, contest or question the validity of the Partnership’s ownership of the Name and Marks or any registration thereto by the Partnership.  In connection with the use of the Name and the Marks, each ETRN Entity and each Partnership Entity shall not in any manner represent that they have any ownership in the Name and the Marks or registration thereof except as set forth herein, and ETRN, on behalf of itself and the ETRN Entities and Partnership Entities, acknowledges that the use of the Name and the Marks shall not create any right, title or interest in or to the Name and the Marks, and all use of the Name and the Marks by an ETRN Entity or a Partnership Entity shall inure to the benefit of the Partnership.

 

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(b)                                  ETRN agrees, and agrees to cause each ETRN Entity and Partnership Entity, to use the Name and Marks in accordance with such quality standards established by or for the Partnership and communicated to ETRN from time to time, it being understood that the products and services offered by the ETRN Entities and the Partnership Entities immediately before the Closing Date are of a quality that is acceptable to the Partnership and justifies the License.  In the event any ETRN Entity or Partnership Entity is determined by the Partnership to be using the Marks in a manner not in accordance with quality standards established by the Partnership, the Partnership shall provide written notice of such unacceptable use including the reason why applicable quality standards are not being met.  If acceptable proof that quality standards are met is not provided to the Partnership within thirty (30) days of such notice, the entity’s license to use the Marks shall terminate and shall not be renewed absent written authorization from the Partnership.

 

3.3                                In the Event of Termination .  In the event of termination of this Agreement, pursuant to Section 4.4 or otherwise, or the termination of the License, the right of the ETRN Entities and the Partnership Entities to utilize or possess the Marks licensed under this Agreement shall automatically cease, and no later than ninety (90) days following such termination, (a) each ETRN Entity and Partnership Entity shall cease all use of the Marks and shall adopt trademarks, service marks, and trade names that are not confusingly similar to the Marks, provided , however , that any use of the Marks during such 90-day period shall continue to be subject to Section 3.2(b) , (b) at the Partnership’s request, the ETRN Entities and the Partnership Entities shall destroy all materials and content upon which the Marks continue to appear (or otherwise modify such materials and content such that the use or appearance of the Marks ceases) that are under their control, and certify in writing to the Partnership that the ETRN Entities and the Partnership Entities have done so, and (c) each ETRN Entity and Partnership Entity shall change its legal name so that there is no reference therein to the name “Equitrans,” any name or d/b/a then used by the Partnership or any variation, derivation or abbreviation thereof, and in connection therewith, shall make all necessary filings of certificates with the Secretary of State of the State of Delaware and to otherwise amend its organizational documents by such date.

 

ARTICLE IV
MISCELLANEOUS

 

4.1                                Choice of Law; Submission to Jurisdiction .  This Agreement shall be subject to and governed by the laws of the Commonwealth of Pennsylvania, excluding any conflicts-of-law rule or principle that might refer the construction or interpretation of this Agreement to the laws of another state. Each Party hereby submits to the jurisdiction of the state and federal courts in the Commonwealth of Pennsylvania and to venue in the state and federal courts in Allegheny County, Pennsylvania.

 

4.2                                Notice .  All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by depositing same in the United States mail, addressed to the Person to be notified, postage-paid, and registered or certified with return receipt requested or by delivering such notice in person, by overnight delivery service or by facsimile to such Party. Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by facsimile shall be effective upon actual receipt if

 

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received during the recipient’s normal business hours or at the beginning of the recipient’s next business day after receipt if not received during the recipient’s normal business hours. All notices to be sent to a Party pursuant to this Agreement shall be sent to or made at the address set forth below or at such other address as such Party may stipulate to the other Parties in the manner provided in this Section 4.2 .

 

If to any of the ETRN Entities:

 

Equitrans Midstream Corporation

625 Liberty Avenue, Suite 2000

Pittsburgh, PA 15222

Attn:  General Counsel

 

If to any member of the Partnership Group:

 

EQM Midstream Partners, LP

c/o EQM Midstream Services, LLC, its General Partner

625 Liberty Avenue, Suite 2000

Pittsburgh, PA 15222

Attn:  General Counsel

 

4.3                                Entire Agreement .  This Agreement, together with the Secondment Agreement, constitute the entire agreement of the Parties relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written, relating to the matters contained herein.

 

4.4                                Termination of Agreement .  Notwithstanding any other provision of this Agreement, (a) if the General Partner is removed as general partner of the Partnership under circumstances where (i) Cause does not exist and the Common Units held by the General Partner and its Affiliates are not voted in favor of such removal, or (ii) Cause exists, then this Agreement, other than the provisions set forth in Section 3.3 , may at any time thereafter be terminated by ETRN by written notice to the other Parties, or (b) if a Change of Control of the General Partner, ETRN or the Partnership occurs, then this Agreement, other than the provisions set forth in Section 3.3 , may at any time thereafter be terminated by ETRN by written notice to the other Parties.

 

4.5                                Amendment or Modification .  This Agreement may be amended or modified from time to time only by the written agreement of all the Parties hereto; provided, however , that the Partnership may not, without the prior approval of the Conflicts Committee, agree to any amendment or modification of this Agreement that, in the reasonable discretion of the General Partner, would be adverse in any material respect to the holders of Common Units.  Each such instrument shall be reduced to writing and shall be designated on its face an “Amendment” or an “Addendum” to this Agreement.

 

4.6                                Assignment; Third Party Beneficiaries .  No Party shall have the right to assign its rights or obligations under this Agreement without the consent of the other Parties hereto; provided, however, that the Partnership may make a collateral assignment of this Agreement

 

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solely to secure working capital financing for the Partnership. Each of the Parties hereto specifically intends that each entity comprising the ETRN Entities and the Partnership Entities, as applicable, whether or not a Party to this Agreement, shall be entitled to assert rights and remedies hereunder as third-party beneficiaries hereto with respect to those provisions of this Agreement affording a right, benefit or privilege to any such entity.

 

4.7                                Counterparts .  This Agreement may be executed in any number of counterparts with the same effect as if all signatory parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument. Delivery of an executed signature page of this Agreement by facsimile transmission or in portable document format (.pdf) shall be effective as delivery of a manually executed counterpart hereof.

 

4.8                                Severability .  If any provision of this Agreement shall be held invalid or unenforceable by a court or regulatory body of competent jurisdiction, the remainder of this Agreement shall remain in full force and effect.

 

4.9                                Further Assurances .  In connection with this Agreement and all transactions contemplated by this Agreement, each signatory party hereto agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and all such transactions.

 

4.10                         Rights of Limited Partners .  Except as set forth in Section 4.6 , the provisions of this Agreement are enforceable solely by the Parties to this Agreement, and no Limited Partner of the Partnership shall have the right, separate and apart from the Partnership, to enforce any provision of this Agreement or to compel any Party to this Agreement to comply with the terms of this Agreement.

 

[ Signature Page Follows ]

 

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IN WITNESS WHEREOF , the Parties have executed this Agreement on, and effective as of, the Closing Date.

 

 

EQUITRANS MIDSTREAM CORPORATION

 

 

 

 

 

By:

/s/ Thomas F. Karam

 

 

Thomas F. Karam

 

 

President and Chief Executive Officer

 

 

 

 

 

EQM MIDSTREAM PARTNERS, LP

 

 

 

By:

EQM Midstream Services, LLC,

 

 

its general partner

 

 

 

 

 

By:

/s/ Kirk Oliver

 

 

Kirk Oliver

 

 

Senior Vice President and Chief Financial Officer

 

 

 

 

 

EQM MIDSTREAM SERVICES, LLC

 

 

 

 

 

By:

/s/ Kirk Oliver

 

 

Kirk Oliver

 

 

Senior Vice President and Chief Financial Officer

 

[Signature Page to Omnibus Agreement (EQM)]

 


Exhibit 10.4

 

Execution Version

 

SECONDMENT AGREEMENT

 

This SECONDMENT AGREEMENT (“ Agreement ”) is dated as of November 13, 2018 (the “ Effective Date ”) by and among Equitrans Midstream Corporation, a Pennsylvania corporation (“ ETRN ”), EQM Midstream Partners, LP, a Delaware limited partnership (the “ Partnership ”), and EQM Midstream Services, LLC, a Delaware limited liability company and the general partner of the Partnership (“ General Partner ”).  ETRN, 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 ETRN, are parties to that certain Omnibus Agreement (as amended from time to time, the “ Omnibus Agreement ”) dated as of the date hereof, which provides for, among other things, the provision by ETRN of certain corporate, general and administrative services to the Partnership and its subsidiaries (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 by their execution of this Agreement to evidence their understanding, as more fully set forth in Article 2 , with respect to the secondment of employees for the provision of certain operation and management services by the ETRN Group (as defined below) for and on behalf of the Partnership Group and the Partnership’s obligations related thereto.

 

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 (including vehicles) 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 ETRN and the Partnership determine to exclude any such assets from being subject to this Agreement (such excluded assets, “ Excluded Facilities ”).

 

ARTICLE 2
SECONDMENT OF EMPLOYEES

 

2.1                                Seconded Employees .  Subject to the terms of this Agreement, ETRN agrees to second, or cause to be seconded, respectively, those available employees of any of ETRN and its affiliates (other than the General Partner, the Partnership and its subsidiaries) (the “ ETRN 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 ETRN 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 ETRN 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 ETRN 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 .  ETRN 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 .  ETRN 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 ETRN 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 ETRN 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 ETRN

 

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Group in connection with operations conducted by the ETRN 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 ETRN Group member, or if the employment of any Seconded Employee is terminated by an applicable ETRN Group member, ETRN will promptly notify the applicable Owner.  During the Period of Secondment of any Seconded Employee, the applicable ETRN 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 ETRN 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.  ETRN 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 ETRN 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, ETRN 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 ETRN 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 ETRN Group, the Owner will be assigned the applicable ETRN 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 ETRN Group member and any applicable union or as may be allowed by law.  The Owner is not, hereby, agreeing to recognize

 

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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 ETRN Group member.

 

3.6                                Seconded Employees Qualifications; Approval .  ETRN will provide such suitably qualified and experienced Seconded Employees as ETRN 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 ETRN 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 ETRN 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. ETRN 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 The Employee Retirement Income Security Act of 1974, as amended (“ 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 ETRN Group member or any entity that would be treated as a single employer with ETRN or the ETRN Group member under Sections 414(b), (c) or (m) of the Code or Section 4001(b)(1) of ERISA (“ ERISA Affiliates ”), or under which ETRN, the ETRN 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).

 

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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 ETRN for the secondment of the Seconded Employees pursuant to this Agreement in the same manner that the Partnership reimburses ETRN pursuant to the reimbursement for services provisions of the Omnibus Agreement (“ Services/Secondment Reimbursement ”).

 

4.2                                Billing Procedures .  ETRN 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, ETRN 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 ETRN Group based upon the Allocation Percentage, provided that the Owner and ETRN or the applicable ETRN 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 ETRN 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

 

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(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 ETRN 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 “ETRN” 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 “ ETRN Indemnitees ”); provided , however , that the ETRN Indemnitees shall not include the Owners, the General Partner or the Partnership. As used in this Article 6 , references to “third parties” shall not include any ETRN Indemnitees.

 

6.3                                Indemnification . THE OWNERS SHALL RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS THE ETRN 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 (A) DAMAGE, LOSS OR DESTRUCTION OF THE FACILITIES, (B) BODILY INJURY, ILLNESS OR DEATH OF ANY PERSON, AND (C) 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

 

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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 , that 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 ETRN 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 the Partnership or the General Partner to:

 

EQM Midstream Partners, LP

EQM Midstream Services, LLC

625 Liberty Avenue, Suite 2000

Pittsburgh, PA 15222

Attn: General Counsel

 

If to any member of the ETRN Group, to:

 

Equitrans Midstream Corporation

625 Liberty Avenue, Suite 2000

Pittsburgh, PA 15222

Attn:  General Counsel

 

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 ETRN’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 ETRN and

 

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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, ETRN Group member or an Owner any rights or remedies hereunder, and no person other than the Parties, ETRN Group members and Owners is entitled to rely on or enforce any representation, warranty or covenant contained herein.  The ETRN Group members and Owners are intended third-party beneficiaries of this Agreement.

 

[ Signature Pages Follow ]

 

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IN WITNESS WHEREOF , the Parties have executed this Agreement on, and effective as of, the Effective Date.

 

 

EQUITRANS MIDSTREAM CORPORATION

 

 

 

 

 

By:

/s/ Thomas F. Karam

 

 

Thomas F. Karam

 

 

President and Chief Executive Officer

 

 

 

 

 

EQM MIDSTREAM PARTNERS, LP

 

 

 

By:

EQM Midstream Services, LLC,

 

 

its general partner

 

 

 

 

 

By:

/s/ Kirk Oliver

 

 

Kirk Oliver

 

 

Senior Vice President and Chief Financial Officer

 

 

 

 

 

EQM MIDSTREAM SERVICES, LLC

 

 

 

 

 

By:

/s/ Kirk Oliver

 

 

Kirk Oliver

 

 

Senior Vice President and Chief Financial Officer

 

[Signature Page to Secondment Agreement (EQM)]