Item 1.01. Entry Into a Material Definitive Agreement.
First Amendment to Revolving Credit
Agreement
On March 30, 2020 (the
Amendment Date), EQM Midstream Partners, LP (EQM) entered into an amendment (the Revolver Amendment) to that certain Third Amended
and Restated Credit Agreement dated as of October 31, 2018 (the Revolving Credit Agreement, and as amended by the Revolver Amendment,
the Amended Revolving Credit Agreement), by and among EQM, Wells Fargo Bank, National Association, as administrative agent, and
the other lenders and other parties from time to time party thereto.
The Revolver Amendment
amended, among other things:
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certain defined terms, including:
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the Applicable Rate (as defined in the Amended Revolving Credit Agreement) under the
Revolving Credit Agreement such that: (i) Base Rate Loans (as defined in the Amended Revolving Credit Agreement) bear
interest at a base rate plus a margin of 0.125% to 1.750% determined on the basis of EQM’s then current credit rating
and (ii) Eurodollar Rate Loans (as defined in the Amended Revolving Credit Agreement) bear interest at a Eurodollar Rate (as
defined in the Amended Revolving Credit Agreement) plus a margin of 1.125% to 2.750% also determined on the basis of
EQM’s then current credit rating; and
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“Consolidated EBITDA”, such that the Amended Revolving Credit Agreement allows for
adjustment of “Consolidated EBITDA” in any applicable period for the difference between the amount of revenue recognized
with respect to all contractual performance obligations and the amount of consideration received with respect to all contractual
performance obligations; and
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various other defined terms, including the definition of “Change of Control”, which
result in conformity with the Amended Term Loan (defined below); and
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certain negative covenants under the Revolving
Credit Agreement, including:
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the financial covenant pursuant to which, except for certain measurement periods following the
consummation of certain acquisitions during which the consolidated leverage ratio cannot exceed the greater of 5.50 to 1.00 or
the maximum ratio otherwise permitted for the applicable period, the consolidated leverage ratio cannot exceed, (a) for each fiscal
quarter ending prior to the Amendment Date, 5.00 to 1.00, (b) for each fiscal quarter ending on and after the Amendment Date and
on or prior to March 31, 2021, 5.75 to 1.00, (c) for each fiscal quarter ending on and after June 30, 2021 and on or prior to December
31, 2021, 5.50 to 1.00, (d) for each fiscal quarter ending on and after March 31, 2022 and on or prior to December 31, 2022, 5.25
to 1.00 and (e) for each fiscal quarter ending on and after March 31, 2023, 5.00 to 1.00; and
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the lien covenant such that the specified percentage of Consolidated Net Tangible Assets (as defined
in the Amended Revolving Credit Agreement) applicable to the existing exception for liens securing obligations not to exceed such
specified percentage at the time of creation, incurrence, assumption or imposition of such lien is reduced from 15% to 5% of Consolidated
Net Tangible Assets; and
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the debt covenant such that the specified percentage of Consolidated Net Tangible Assets applicable
to the existing exception for debt incurred by subsidiaries of EQM not to exceed such specified percentage at the time of incurrence
is reduced from 15% to 5% of Consolidated Net Tangible Assets.
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The Amended Revolving
Credit Agreement also includes an additional negative covenant, which, subject to certain exceptions, limits the ability of EQM
and certain of its subsidiaries to enter into agreements that restrict (a) subsidiary dividends and distributions, (b) subsidiary
guarantees of the obligations under the Amended Revolving Credit Agreement or (c) the creation of liens to secure obligations under
the Amended Revolving Credit Agreement.
The Revolver Amendment
is attached as Exhibit 10.1 to this Current Report and incorporated into this Item 1.01 by reference. The foregoing summary has
been included to provide investors and security holders with information regarding the terms of the Revolver Amendment and is qualified
in its entirety by the terms and conditions of the Revolver Amendment. It is not intended to provide any other factual information
about EQM or its subsidiaries and affiliates.
First Amendment to Term Loan Credit
Agreement
On the Amendment Date, EQM entered into an amendment (the Term Loan Amendment) to that certain Term Loan Agreement dated as
of August 16, 2019 (the Term Loan Agreement, and as amended by the Term Loan Amendment, the Amended Term Loan Agreement), by and
among EQM, Toronto Dominion (Texas) LLC, as administrative agent, and the lenders from time to time party thereto.
The Term Loan Amendment
amended, among other things:
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certain defined terms, including:
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the Applicable Rate (as defined in the Amended Term Loan Agreement) under the Term Loan Agreement,
such that: (i) Base Rate Loans (as defined in the Amended Term Loan Agreement) bear interest at a base rate plus a margin of 0.000%
to 1.625% determined on the basis of EQM’s then current credit rating and (ii) Eurodollar Rate Loans (as defined in the Amended
Term Loan Agreement) bear interest at a Eurodollar Rate (as defined in the Amended Term Loan Agreement) plus a margin of 1.000%
to 2.625% also determined on the basis of EQM’s then current credit rating; and
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“Consolidated EBITDA”, such that the Amended Term Loan Agreement allows for adjustment
of “Consolidated EBITDA” in any applicable period for the difference between the amount of revenue recognized with
respect to all contractual performance obligations and the amount of consideration received with respect to all contractual performance
obligations; and
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certain negative covenants under the Amended
Term Loan Agreement, including:
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the financial covenant pursuant to which, except for certain measurement periods following the
consummation of certain acquisitions during which the consolidated leverage ratio cannot exceed the greater of 5.50 to 1.00 or
the maximum ratio otherwise permitted for the applicable period, the consolidated leverage ratio cannot exceed, (a) for each fiscal
quarter ending prior to the Amendment Date, 5.00 to 1.00, (b) for each fiscal quarter ending on and after the Amendment Date and
on or prior to March 31, 2021, 5.75 to 1.00, (c) for each fiscal quarter ending on and after June 30, 2021 and on or prior to December
31, 2021, 5.50 to 1.00, (d) for each fiscal quarter ending on and after March 31, 2022 and on or prior to December 31, 2022, 5.25
to 1.00 and (e) for each fiscal quarter ending on and after March 31, 2023, 5.00 to 1.00; and
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the lien covenant such that the specified percentage of Consolidated Net Tangible Assets (as defined
in the Amended Term Loan Agreement) applicable to the existing exception for liens securing obligations not to exceed such specified
percentage at the time of creation, incurrence, assumption or imposition of such lien is reduced from 15% to 5% of Consolidated
Net Tangible Assets; and
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the debt covenant such that the specified percentage of Consolidated Net Tangible Assets applicable
to the existing exception for debt incurred by subsidiaries of EQM not to exceed such specified percentage at the time of incurrence
is reduced from 15% to 5% of Consolidated Net Tangible Assets.
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The Amended Term Loan
Agreement also includes an additional negative covenant, which, subject to certain exceptions, limits the ability of EQM and certain
of its subsidiaries to enter into agreements that restrict (a) subsidiary dividends and distributions, (b) subsidiary guarantees
of the obligations under the Amended Term Loan Agreement or (c) the creation of liens to secure obligations under the Amended Term
Loan Agreement.
The Term Loan Amendment
is attached as Exhibit 10.2 to this Current Report and incorporated into this Item 1.01 by reference. The foregoing summary has
been included to provide investors and security holders with information regarding the terms of the Term Loan Amendment and is
qualified in its entirety by the terms and conditions of the Term Loan Amendment. It is not intended to provide any other factual
information about EQM or its subsidiaries and affiliates.
Relationships
Certain of the lenders
under the Amended Revolving Credit Agreement and the Amended Term Loan Agreement and their respective affiliates have, from time
to time, performed, and may in the future perform, various financial advisory, commercial and/or investment banking services for
EQM and/or its affiliates, for which they have received or may receive customary fees and expenses. Certain affiliates of such
lenders have acted, and may in the future act, as underwriters, agents, arrangers or lenders, as applicable, in respect of certain
of EQM’s and/or its subsidiaries’ and/or affiliates’ debt or equity issuances or credit facilities.