| Item 1.01 |
Entry into a Material Definitive Agreement.
|
Indenture and Senior
Notes
On January 8, 2021, EQM Midstream Partners, LP (EQM), a wholly
owned subsidiary of Equitrans Midstream Corporation (ETRN),
completed its previously announced private offering of
$800 million aggregate principal amount of new 4.50% senior
notes due 2029 (the 2029 Notes) and $1,100 million aggregate
principal amount of new 4.75% senior notes due 2031 (the 2031 Notes
and, together with the 2029 Notes, the Notes).
The Notes were issued under and are governed by an indenture, dated
January 8, 2021 (the Indenture), between EQM and the Bank of
New York Mellon Trust Company, N.A., as trustee (the Trustee). The
Indenture contains covenants that limit EQM’s ability to, among
other things, incur certain liens securing indebtedness, engage in
certain sale and leaseback transactions, and enter into certain
consolidations, mergers, conveyances, transfers or leases of all or
substantially all of EQM’s assets. The 2029 Notes will mature on
January 15, 2029 and interest on the 2029 Notes is payable
semi-annually on January 15 and July 15 of each year,
commencing July 15, 2021. The 2031 Notes will mature on
January 15, 2031 and interest on the 2031 Notes is payable
semi-annually on January 15 and July 15 of each year,
commencing July 15, 2021.
The Notes are unsecured and rank equally with all of EQM’s existing
and future senior obligations. The Notes are senior in right of
payment to any of EQM’s future obligations that are, by their
terms, expressly subordinated in right of payment to the Notes. The
Notes are effectively subordinated to EQM’s secured obligations, if
any, to the extent of the value of the collateral securing such
obligations, and structurally subordinated to all indebtedness and
obligations, including trade payables, of EQM’s subsidiaries, other
than any subsidiaries that may guarantee the Notes in the
future.
EQM may, at its option, redeem some or all of the 2029 Notes and
the 2031 Notes, in whole or in part, at any time prior to their
maturity at the applicable redemption price as set forth in the
Indenture.
Upon the occurrence of a Change of Control Triggering Event (as
defined in the Indenture), EQM may be required to offer to purchase
the Notes at a purchase price equal to 101% of the aggregate
principal amount of the Notes repurchased, plus accrued and unpaid
interest, if any, to, but excluding, the repurchase date.
The Indenture contains certain events of default (each an Event of
Default), including the following: (1) default in the payment
of interest on such Notes when due that continues for 30 days;
(2) default in the payment of principal of or premium, if any,
on any such Notes when due, whether at its stated maturity, upon
redemption or otherwise; (3) failure by EQM or any subsidiary
guarantor, if any, to comply for 90 days with the other agreements
with respect to such Notes contained in the Indenture after written
notice by the Trustee or by the holders of at least 25% in
principal amount of the outstanding Notes of such series;
(4) certain events of bankruptcy, insolvency or reorganization
of EQM or any subsidiary guarantor, if any, that is one of EQM’s
Significant Subsidiaries (as defined in the Indenture); and
(5) if such Notes are guaranteed by a subsidiary guarantor
that is one of EQM’s Significant Subsidiaries, (a) the
guarantee of that subsidiary guarantor ceases to be in full force
and effect, except as otherwise provided in the Indenture;
(b) the guarantee of that subsidiary guarantor is declared
null and void in a judicial proceeding; or (c) that subsidiary
guarantor denies or disaffirms its obligations under the Indenture
or its guarantee.
If an Event of Default occurs and is continuing, the Trustee or the
holders of at least 25% in aggregate principal amount of the then
outstanding Notes of such series may declare the Notes of such
series to be due and payable. Upon such a declaration, such
principal, premium, if any, and accrued and unpaid interest on such
Notes will be due and payable immediately. If an Event of Default
relating to certain events of bankruptcy, insolvency or
reorganization occurs, all outstanding Notes will become due and
payable immediately without further action or notice on the part of
the Trustee or any holders of the Notes.
The Bank of New York Mellon, which is a lender under EQM’s
$3 billion credit facility, is an affiliate of the Trustee.
Additionally, the Trustee acts as trustee under indentures that
govern other outstanding notes of EQM.
