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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): August 16, 2023
EQT CORPORATION
(Exact name of registrant as specified in its charter)
| Pennsylvania | 001-3551 | 25-0464690 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification Number) |
625 Liberty Avenue, Suite 1700, Pittsburgh, Pennsylvania 15222
(Address of principal executive offices, including zip code)
(412) 553-5700
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Common Stock, no par value | EQT | New York Stock Exchange |
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 ¨
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. ¨
Item 7.01. Regulation FD Disclosure.
On August 16, 2023, EQT Corporation (“EQT”) issued a news release relating to the Acquisition (as defined below). A copy of EQT’s news release is attached hereto and furnished as Exhibit 99.1 and is incorporated herein by reference.
The information provided in this Item 7.01, including the accompanying Exhibit 99.1, shall be deemed “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of such section, nor shall it be incorporated by reference in any filing made by EQT pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, regardless of the general incorporation language of such filing, except as expressly set forth by specific reference in such filing.
Item 8.01. Other Events.
As previously disclosed, on September 6, 2022, EQT and its wholly owned subsidiary, EQT Production Company (the “Buyer” and, together with EQT, the “EQT Parties”), entered into a Purchase Agreement (as amended and/or restated to date, the “Purchase Agreement”) with THQ Appalachia I, LLC (the “Upstream Seller”), THQ-XcL Holdings I, LLC (together with the Upstream Seller, the “Sellers”) and the subsidiaries of the Sellers named on the signature pages thereto pursuant to which the EQT Parties agreed to acquire (the “Acquisition”) the Sellers’ upstream oil and gas assets and gathering and processing assets through the Buyer’s acquisition of all of the issued and outstanding membership interests of each of THQ Appalachia I Midco, LLC and THQ-XcL Holdings I Midco, LLC in exchange for $2.6 billion in cash and 55.0 million shares of EQT common stock (the “Shares”), in each case, subject to customary closing adjustments. Upon the closing of the Acquisition, the Sellers intend to distribute the Shares to their members, including affiliates of Quantum Energy Partners (“Quantum”).
On August 16, 2023, the U.S. Federal Trade Commission (the “FTC”) resolved its review of the Acquisition pursuant to an Agreement Containing Consent Order (the “ACCO”) entered into among EQT, Quantum and the FTC effective as of such date.
Under the terms of the ACCO, EQT and Quantum have agreed to the following conditions, among others, to complete the Acquisition:
| ● | The Purchase Agreement will be amended to remove the right of the Sellers to designate a person to be included in the slate of nominees recommended by EQT’s board of directors to EQT’s shareholders for election as a director. |
| ● | Quantum will be a passive investor in EQT and will transfer voting power over the Shares received by Quantum from the Sellers to a voting trustee that will vote such Shares in proportion to the votes of EQT’s other shareholders. |
| ● | Quantum will sell the Shares received from the Sellers at Quantum’s discretion but no later than the end of a multi-year time frame agreed to between Quantum and the FTC, the specific expiration of which is confidential. |
| ● | EQT and Quantum will dissolve The Mineral Company LLC (“TMC”), a joint venture created to acquire mineral rights, by distributing its existing assets to the parties and then liquidating TMC. TMC plays an immaterial role in EQT’s land development program, and its dissolution will have no impact on EQT’s forecasted production schedule or cost of production. |
| ● | EQT and Quantum will have certain ongoing limitations on entering into agreements with each other related to natural gas exploration and production activities or mineral rights within the Appalachian Basin. However, the parties will not be prohibited from entering into certain ordinary course transactions, such as land swap agreements, that will enable EQT to fully develop its acreage and advance its development plan without incurring unnecessary additional costs or delays. |
As a result of the ACCO, the closing condition contained in the Purchase Agreement relating to the Hart-Scott-Rodino Act of 1976, as amended, and the rules and regulations promulgated thereunder, has been satisfied, and EQT expects to complete the Acquisition within the next seven business days.
Forward-Looking Statements
This Current Report on Form 8-K (this “Form 8-K”) contains certain forward-looking statements within the meaning of Section 21E of the Exchange Act and Section 27A of the Securities Act. Statements that do not relate strictly to historical or current facts are forward-looking. Without limiting the generality of the foregoing, forward-looking statements contained in this Form 8-K specifically include statements regarding EQT’s plans, expectations, goals and projections relating to the pending Acquisition, including statements relating to the expected timing for completing the Acquisition. The forward-looking statements included in this Form 8-K involve risks and uncertainties that could cause actual results to differ materially from those projected. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. EQT has based these forward-looking statements on current expectations and assumptions about future events, taking into account all information currently known by EQT. While EQT considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks and uncertainties, many of which are difficult to predict and beyond EQT’s control. Any forward-looking statement speaks only as of the date on which such statement is made, and except as required by law, EQT does not intend to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | News Release, dated August 16, 2023, issued by EQT Corporation. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
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.
| EQT CORPORATION | ||
| Date: August 16, 2023 | By: | /s/ William E. Jordan |
| Name: | William E. Jordan | |
| Title: | Executive Vice President, General Counsel and Corporate Secretary | |
Exhibit 99.1
EQT Clear to Close Acquisition of Tug Hill and XcL Midstream
PITTSBURGH, August 16, 2023 /PRNewswire/ -- EQT Corporation (NYSE: EQT) (“EQT” or the “Company”) today announced that the U.S. Federal Trade Commission (the “FTC”) has resolved its review of EQT’s agreement with THQ Appalachia I, LLC ("Tug Hill") and THQ-XcL Holdings I, LLC ("XcL Midstream") to acquire Tug Hill's upstream assets and XcL Midstream's gathering and processing assets pursuant to an Agreement Containing Consent Order entered into among the parties to the transactions and the FTC effective as of today. Tug Hill and XcL Midstream are backed by equity commitments from funds managed by Quantum Energy Partners. The parties have now satisfied the condition relating to the Hart-Scott-Rodino Act of 1976, as amended and the rules and regulations promulgated thereunder, required to close the transaction.
President and CEO Toby Z. Rice stated, “We are pleased the FTC has completed its review and we are now able to bring the acquisition of Tug Hill and XcL Midstream to a close. This acquisition will lower EQT’s cost structure, reduce EQT’s development risk, and increase cash flow and net asset value per share, while maintaining our investment grade balance sheet. It will also allow us to continue our progress in making the energy we produce more affordable, reliable, and cleaner.”
EQT expects to close the transaction within the next seven business days.
Investor Contact:
Cameron Horwitz
Managing Director, Investor Relations & Strategy
412.395.2555
Cameron.Horwitz@eqt.com
Media Contact:
Bridget McNie
Director of Communications
412.720.4500
Bridget.mcnie@eqt.com
About EQT Corporation
EQT Corporation is a leading independent natural gas production company with operations focused in the cores of the Marcellus and Utica Shales in the Appalachian Basin. We are dedicated to responsibly developing our world-class asset base and being the operator of choice for our stakeholders. By leveraging a culture that prioritizes operational efficiency, technology and sustainability, we seek to continuously improve the way we produce environmentally responsible, reliable and low-cost energy. We have a longstanding commitment to the safety of our employees, contractors, and communities, and to the reduction of our overall environmental footprint. Our values are evident in the way we operate and in how we interact each day – trust, teamwork, heart, and evolution are at the center of all we do. Learn more at eqt.com.
Cautionary Statements
This news release contains certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Statements that do not relate strictly to historical or current facts are forward-looking. Without limiting the generality of the foregoing, forward-looking statements contained in this news release specifically include statements regarding the Company’s plans, expectations, goals, projections relating to the pending transaction involving the Company and Tug Hill and XcL Midstream (the “Acquisition”), including statements relating to the benefits or synergies therefrom and statements regarding the projected impacts on the Company's cost structure, cash flow, net asset value per share and balance sheet; the Company's plans, objectives, strategies, expectations and intentions with respect to the assets to be acquired in such pending Acquisition, including the timing of integration of such assets; and the expected timing of closing the Acquisition.
The forward-looking statements included in this news release involve risks and uncertainties that could cause actual results to differ materially from projected results. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The Company has based these forward-looking statements on current expectations and assumptions about future events, taking into account all information currently known by the Company. While the Company considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks and uncertainties, many of which are difficult to predict and beyond the Company’s control. These risks and uncertainties include, but are not limited to, volatility of commodity prices; the costs and results of drilling and operations; uncertainties about estimates of reserves, identification of drilling locations and the ability to add proved reserves in the future; the assumptions underlying production forecasts; the quality of technical data; the Company’s ability to appropriately allocate capital and other resources among its strategic opportunities; access to and cost of capital, including as a result of rising interest rates and other economic uncertainties; the Company’s hedging and other financial contracts; inherent hazards and risks normally incidental to drilling for, producing, transporting and storing natural gas, natural gas liquids (NGLs) and oil; cyber security risks and acts of sabotage; availability and cost of drilling rigs, completion services, equipment, supplies, personnel, oilfield services and sand and water required to execute the Company’s exploration and development plans, including as a result of inflationary pressures; risks associated with operating primarily in the Appalachian Basin and obtaining a substantial amount of the Company’s midstream services from Equitrans Midstream Corporation; the ability to obtain environmental and other permits and the timing thereof; government regulation or action, including regulations pertaining to methane and other greenhouse gas emissions; negative public perception of the fossil fuels industry; increased consumer demand for alternatives to natural gas; environmental and weather risks, including the possible impacts of climate change; and disruptions to the Company’s business due to acquisitions and other significant transactions, including the pending Acquisition. These and other risks are described under Item 1A, “Risk Factors,” and elsewhere in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 and other documents the Company files from time to time with the Securities and Exchange Commission. In addition, the Company may be subject to currently unforeseen risks that may have a materially adverse impact on it.
Any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by law, the Company does not intend to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise.