Exhibit 10.1

 

Execution Version

 

PREFERRED RESTRUCTURING AGREEMENT

 

This PREFERRED RESTRUCTURING AGREEMENT (this “Agreement”), dated as of February
26, 2020, is made and entered into by and among Equitrans Midstream Corporation,
a Pennsylvania corporation (the “Company”), EQM Midstream Partners, LP, a
Delaware limited partnership (the “Partnership”), and the investors set forth on
Schedule I hereto (collectively, the “Investors”).  The Company, the Partnership
and each of the Investors are referred to herein individually as a “Party” and
collectively as the “Parties.” All capitalized terms used herein and not
otherwise defined herein shall have the meanings ascribed to such terms in the
Partnership Agreement (as defined below).

 

R E C I T A L S

 

WHEREAS, on March 13, 2019, the Partnership entered into that certain
Convertible Preferred Unit Purchase Agreement (the “Preferred Purchase
Agreement”) with the purchasers party thereto (the “Initial Series A
Purchasers”), pursuant to which, among other things, the Partnership agreed to
issue and sell Series A Perpetual Convertible Preferred Units representing
limited partner interests in the Partnership (the “Series A Preferred Units”) to
the Initial Series A Purchasers;

 

WHEREAS, on March 18, 2019, the Partnership entered into those certain Joinder
Agreements to the Preferred Purchase Agreement (collectively, the “Joinder
Agreements”) with the purchasers identified therein (the “Joinder Series A
Purchasers” and, together with the Initial Series A Purchasers, the “Series A
Preferred Unitholders”), pursuant to which, among other things, the Partnership
agreed to issue and sell Series A Preferred Units to the Joinder Series A
Purchasers;

 

WHEREAS, concurrently with the execution and delivery of this Agreement, the
Company, EQM LP Corporation, a Delaware corporation and a wholly owned
subsidiary of the Company (“EQM LP”), LS Merger Sub, LLC, a Delaware limited
liability company and a wholly owned subsidiary of EQM LP (“Merger Sub”), the
Partnership, and EQGP Services, LLC, a Delaware limited liability company and
the general partner of the Partnership, are entering into an Agreement and Plan
of Merger (the “Merger Agreement”), providing for, among other things, the
merger of Merger Sub with and into the Partnership (the “Merger”), with the
Partnership surviving the Merger as an indirect wholly owned subsidiary of the
Company;

 

WHEREAS, the consummation of the Merger will constitute a “Series A Change of
Control” and “Partnership Rollup Event” (each as defined in the Partnership
Agreement);

 

WHEREAS, the Investors constitute all of the Series A Preferred Unitholders as
of the date of this Agreement;

 

WHEREAS, pursuant to Section 5.11(b)(vi)(B) of the Partnership Agreement, upon a
Series A Change of Control that constitutes a Partnership Rollup Event, each
Series A Preferred Unitholder is entitled to elect the treatment of their Series
A Preferred Units (the “Series A CoC Options”);

 

WHEREAS, in lieu of electing a Series A CoC Option as set forth in the
Partnership Agreement, and upon performance in full of the Company’s and the
Partnership’s obligations hereunder at the Closing (as defined below), in full
satisfaction of each Series A Preferred Unitholder’s right to elect a Series A
CoC Option under the Partnership Agreement upon the Series A Change of Control
and Partnership Rollup Event resulting from the Merger, the Parties desire for
(i) the Partnership to redeem in cash from each Investor the number of Series A
Preferred Units set forth opposite such Investor’s name under “Redeemed Series A
Preferred Units” on Schedule I (the “Redemption”) and (ii) each Investor to
exchange (together with the Redemption, the “Restructuring”) the total number of
Series A Preferred Units such Investor owns, after giving effect to the
Redemption, for the number of Series A Preferred Shares (as defined below) set
forth opposite such Investor’s name under “Series A Preferred Shares” on
Schedule I (each such Series A Preferred Share constituting a “Series A
Substantially Equivalent Unit” as defined in the Partnership Agreement), in each
case, on the terms and subject to the conditions set forth in this Agreement;

 

 

 

 

WHEREAS, the Investors and the Partnership’s management have discussed the
reasons for the Merger and the potential benefits to the unitholders of the
Partnership that may result therefrom, and based on such discussions and the
terms of the Merger, the Investors desire to support the Merger as more fully
described in this Agreement; and

 

WHEREAS, the Parties are entering into this Agreement to reflect the agreements
between the Parties in connection with the Restructuring.

 

NOW, THEREFORE, in consideration of the foregoing, the representations,
warranties, covenants, and agreements contained in this Agreement and of other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, intending to be legally bound, do hereby agree as
follows:

 

Article I
DEFINITIONS

 

1.1          Definitions.  For all purposes of and under this Agreement, the
following terms shall have the following respective meanings:

 

(a)                “Affiliate” means, with respect to a specified Person, any
other Person, directly or indirectly controlling, controlled by or under direct
or indirect common control with such specified Person.  For purposes of this
definition, “control” (including, with correlative meanings, “controlling,”
“controlled by,” and “under common control with”) means the power to direct or
cause the direction of the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise. Notwithstanding anything to the contrary provided herein, for
purposes of this Agreement, no Investor shall be considered an Affiliate of the
Company or the Partnership, and no Investor or any of its Affiliates shall be
considered Affiliates of any other Investor or any of such other Investor’s
Affiliates, in either case, solely by virtue of such Investor’s ownership of the
Series A Preferred Shares. Notwithstanding anything in this definition to the
contrary, for purposes of this Agreement, (a) the Company Entities and the
Partnership Entities, on the one hand, and any Investor, on the other hand,
shall not be considered Affiliates and (b) any fund or account managed, advised
or subadvised, directly or indirectly, by an Investor or its Affiliates, shall
be considered an Affiliate of such Investor.

 

(b)                “Affiliate Group” means, with respect to each Investor,
collectively, such Investor and each of its Affiliates who is also a holder of
Series A Preferred Units.

 

(c)                “Assets” means all of the assets that are owned and operated
by the Company Entities or the Partnership Entities, as applicable.

 

(d)                “Business Day” means any day other than a Saturday, Sunday,
any federal legal holiday or any other day on which banking institutions in the
State of New York or the Commonwealth of Pennsylvania are authorized or required
by Law or other governmental action to close.

 

(e)                “Certificate of Designations” means the Certificate of
Designations establishing the Series A Preferred Shares, in the form attached
hereto as Exhibit B.

 

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(f)                 “Code” means the Internal Revenue Code of 1986, as amended.

 

(g)                “Common Shares” means the shares of common stock, no par
value, of the Company.

 

(h)                “Company Articles” means the Amended and Restated Articles of
the Company, as amended.

 

(i)                 “Company Disclosure Schedule” has the meaning set forth in
the lead-in to Article III.

 

(j)                 “Company Entities” means the Company and its subsidiaries;
provided, however, that none of the Partnership or its subsidiaries shall be
considered a Company Entity for purposes of this Agreement.

 

(k)                “Company Schedule” has the meaning set forth in the lead-in
to Article III.

 

(l)                 “Enforceability Exceptions” means (i) applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar Laws
relating to or affecting creditors’ rights generally and by general principles
of equity (regardless of whether such enforceability is considered in a
Proceeding in equity or at Law) and (ii) public policy, applicable Law relating
to fiduciary duties and indemnification and contribution and an implied covenant
of good faith and fair dealing.

 

(m)              “Exchange Act” means the Securities and Exchange Act of 1934,
as amended.

 

(n)                “GAAP” means generally accepted accounting principles in the
United States of America in effect as of the date hereof; provided, that for the
financial statements of the Company prepared as of a certain date, GAAP
referenced therein shall be GAAP as of the date of such financial statements.

 

(o)                “Governmental Authority” means any federal, state,
provincial, local or foreign court, tribunal, arbitrator, administrative body or
other governmental or quasi-governmental entity, including any head of a
government department, body or agency, with competent jurisdiction.

 

(p)                “Knowledge” means, with respect to the Company, the actual
knowledge of the Chief Executive Officer, the Chief Financial Officer and the
Chief Operating Officer of the Company after reasonable inquiry.

 

(q)                “Laws” means all statutes, regulations, codes, tariffs,
ordinances, decisions, administrative interpretations, writs, injunctions,
stipulations, statutory rules, orders, judgments, decrees, and terms and
conditions of any grant of approval, permission, authority, permit, or license
of any court, Governmental Authority, statutory body, or self-regulatory
authority (including the New York Stock Exchange).

 

(r)                 “Lead Investors” means the Investors listed on Exhibit E.

 

(s)                “Liens” means any lien (statutory or otherwise), encumbrance,
security interest, security agreement, pledge, mortgage, conditional sale, trust
receipt, charge or claim or a lease, consignment or bailment, preference or
priority, assessment, easement, servitude, restriction on transfer or other
encumbrance upon or with respect to any property of any kind.

 

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(t)                 “Material Adverse Effect” means any event, circumstance,
occurrence, change or effect that, individually or in the aggregate, has had or
would reasonably be expected to have a material and adverse effect on (a) the
Assets, liabilities, condition (financial or otherwise), business, results of
operations, affairs or prospects of the Company Entities taken as a whole; (b)
the ability of the Company Entities taken as a whole to carry on their
respective business as such business is conducted as of the date hereof or on
the ability of the Company Entities taken as a whole to meet their obligations
under the Restructuring Documents on a timely basis; or (c) the ability of the
Company or the Company Entities to consummate the transactions contemplated by
the Restructuring Documents; provided, however, that a Material Adverse Effect
shall not include any material and adverse effect on the foregoing to the extent
such material and adverse effect results from, arises out of, or is attributable
to (i) a general deterioration in the economy or changes in the general state of
the industries in which the Company Entities operate, except, with respect to
this clause (i), to the extent that the Company Entities, taken as a whole, are
adversely affected in a disproportionate manner as compared to other industry
participants, (ii) acts of war (whether or not declared), hostilities, sabotage,
terrorism, military actions or the escalation of any of the foregoing,
hurricane, flood, tornado, earthquake or other natural disaster, or any other
force majeure event, whether or not caused by any Person, or any national or
international calamity or crisis, (iii) any change in applicable Law or GAAP or
the interpretation or enforcement thereof applicable to any of the Company
Entities, (iv) any change in the credit rating of any of the Company Entities or
any of their securities (it being understood that the facts and circumstances
giving rise to such change in the credit rating may be deemed to constitute, and
may be taken into account in determining whether there has been or would
reasonably be expected to be a Material Adverse Effect if such facts and
circumstances are not otherwise described in clauses (i) through (v) of this
definition), or (v) any change resulting or arising from (A) the taking of any
action by the Company or any of its Affiliates required or otherwise expressly
contemplated by this Agreement or consented to or requested by the Investors in
writing or (B) the abstaining by the Company or any of its Affiliates from
taking any action that is prohibited by this Agreement or which abstention is
otherwise requested by the Investors.

 

(u)                “NYSE” means the New York Stock Exchange.

 

(v)                “Organizational Documents” means, as applicable, an entity’s
agreement or certificate of limited partnership, limited liability company
agreement, certificate of formation, certificate or articles of incorporation,
bylaws or other similar organizational documents.

 

(w)               “Partnership Agreement” means the Fourth Amended and Restated
Agreement of Limited Partnership of the Partnership, dated as of April 10, 2019,
as amended by the First Amendment thereto, dated as of October 9, 2019, and the
Second Amendment thereto, dated as of February 26, 2020.

 

(x)                 “Partnership Disclosure Schedule” has the meaning set forth
in the lead-in to Article IV.

 

(y)                “Partnership Entities” has the meaning ascribed to such term
in the Preferred Purchase Agreement.

 

(z)                 “Partnership Schedule” has the meaning set forth in the
lead-in to Article IV.

 

(aa)              “Person” means an individual or entity, including any
partnership, corporation, association, trust, limited liability company, joint
venture, unincorporated organization, or other entity or Governmental Authority.

 

(bb)             “Proceeding” means any claim, action, suit, proceeding,
arbitration, mediation, investigation, or inquiry by or before any Governmental
Authority or otherwise.

 

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(cc)              “Representatives” of any Person means the officers, directors,
managers, employees, agents, counsel, accountants, investment bankers and other
representatives of such Person.

 

(dd)             “Restructuring Documents” means, collectively, this Agreement,
the Certificate of Designations (as defined below), the Registration Rights
Agreement and any and all other agreements or instruments executed and delivered
by the Company, the Partnership or the Investors hereunder or thereunder.

 

(ee)              “Rules and Regulations” means the requirements of the
Securities Act and the rules and regulations of the Commission thereunder.

 

(ff)                “SEC Documents” means the Company’s registration statements,
reports, schedules and statements required to be filed by it with the Commission
under the Exchange Act or the Securities Act and filed prior to the date hereof.

 

(gg)              “Securities Act” means the Securities Act of 1933, as amended.

 

(hh)              “Series A Preferred Shares” means the class of shares of the
Company designated as “Series A Perpetual Convertible Preferred Shares” with the
designations, preferences and relative, participating, optional or other special
rights, privileges, powers, duties and obligations as set forth in the
Certificate of Designations.

 

(ii)                “Tax Return” means any return, report or similar filing
(including attached schedules, statements and exhibits) filed or required to be
filed with respect to Taxes (and any amendments thereto), including any
information return, claim for refund or declaration of estimated Taxes.

 

(jj)                “Taxes” means any foreign, federal, state, local or other
taxes of any kind whatsoever (together with any and all interest, penalties,
additions to tax and additional amounts imposed with respect thereto) imposed by
any Governmental Authority, including taxes on or with respect to income,
franchises, windfall or other profits, gross receipts, property, sales, use,
capital stock, payroll, employment, unemployment, social security, workers’
compensation or net worth, and taxes in the nature of excise, withholding, ad
valorem, value added and production or severance taxes.

 

(kk)              “Treasury Regulations” means the Treasury regulations
promulgated under the Code.

 

1.2          Other Definitional and Interpretative Provisions.

 

(a)                The division of this Agreement into articles, sections, and
other portions and the insertion of headings are for convenience of reference
only and shall not affect the construction or interpretation hereof. Unless
otherwise indicated, all references to an “Article” or “Section” followed by a
number or a letter refer to the specified Article or Section of this Agreement.
The terms “this Agreement,” “hereof,” “herein,” and “hereunder” and similar
expressions refer to this Agreement and not to any particular Article, Section,
or other portion hereof.  Unless otherwise specifically indicated or the context
otherwise requires, (i) all references to “dollars” or “$” mean United States
dollars, (ii) words importing the singular shall include the plural and vice
versa and words importing any gender shall include all genders, and
(iii) “include,” “includes,” and “including” shall be deemed to be followed by
the words “without limitation.”

 

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(b)                In the event that any date on which any action is required to
be taken hereunder by any of the Parties that can only be taken on a Business
Day, but such date does not fall on a Business Day, such action shall be
required to be taken on the next succeeding day that is a Business Day. 
Reference to any Party is also a reference to such Party’s permitted successors
and assigns. The Exhibits attached to this Agreement are hereby incorporated by
reference into this Agreement and form part hereof. Unless otherwise indicated,
all references to an “Exhibit” followed by a number or a letter refer to the
specified Exhibit to this Agreement. The Parties have participated jointly in
the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, it is the intention of the Parties
that this Agreement shall be construed as if drafted jointly by the Parties and
no presumption or burden of proof shall arise favoring or disfavoring any Person
by virtue of the authorship of any of the provisions of this Agreement. In this
Agreement, specific provisions shall prevail over general provisions.  Further,
prior drafts of this Agreement, or the fact that any clauses have been added,
deleted, or otherwise modified from any prior drafts of this Agreement, shall
not be used as an aid of construction or otherwise constitute evidence of the
intent of the Parties; and no presumption or burden of proof shall arise
favoring or disfavoring any Party by virtue of such prior drafts.

 

Article II
SERIES A RESTRUCTURING

 

2.1          Restructuring.

 

(a)                The Parties hereby acknowledge and agree that in connection
with the occurrence of a Series A Change of Control pursuant to the Merger, at
the Closing (and further conditioned upon, in the case of the Investors,
delivery by the Company and the Partnership, substantially concurrently with the
Closing, of the deliverables set forth in Sections 2.10 and 2.11, as applicable)
(i) the Partnership will redeem in cash from each Investor the number of Series
A Preferred Units set forth opposite such Investor’s name under “Redeemed Series
A Preferred Units” on Schedule I (subject to Section 2.1(b)) at a price per
Series A Preferred Unit equal to 101% of the sum of (i) the Series A Accrued
Amount of such Series A Preferred Unit as of the Closing plus (ii) any Series A
Partial Period Distributions on such Series A Preferred Unit as of the Closing
(such cash payment as to each Investor, the “Redemption Payment”), and (ii) each
Investor will exchange each remaining Series A Preferred Unit, after giving
effect to the Redemption, such Investor owns for 2.44 Series A Preferred Shares
issued by the Company. In consideration for the foregoing, each Investor hereby
waives its rights (including, without limitation, in respect of any notice
requirement) granted to such Investor in the Partnership Agreement to elect a
Series A CoC Option with respect to the Merger (provided, that for the avoidance
of doubt, the foregoing shall not limit any Investor in exercising any such
right to make any Series A CoC Option election with respect to any applicable
transaction following any termination of this Agreement). Effective as of the
Closing, (a) each Investor hereby agrees to surrender for cancellation to the
transfer agent of the Partnership (the “Partnership Transfer Agent”), free and
clear of any and all Liens other than those arising under the Partnership
Agreement, the number of Series A Preferred Units set forth opposite such
Investor’s name under the heading “Series A Preferred Units” on Schedule I
hereto and (b) upon such surrender, (1) the Partnership hereby agrees to cause
the Partnership Transfer Agent to pay to such Investor such Investor’s
Redemption Payment in accordance with Section 2.11(a) and (2) the Company hereby
agrees to cause the transfer agent of the Company (the “Company Transfer Agent”)
to issue to such Investor, free and clear of any and all Liens, the number of
Series A Preferred Shares set forth opposite such Investor’s name under the
heading “Series A Preferred Shares” on Schedule I hereto. Each Investor hereby
acknowledges and agrees that each Series A Preferred Share it receives pursuant
to this Agreement and the Certificate of Designations shall constitute a “Series
A Substantially Equivalent Unit” as defined in the Partnership Agreement and
hereby waives any right to bring any Proceeding against the Partnership or its
Affiliates claiming the contrary.

 

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(b)                Notwithstanding anything to the contrary in this Agreement,
each Investor shall have the right, by delivering written notice to the Company
and the Partnership not less than five Business Days prior to the Closing, to
re-allocate among the Investors in such Investor’s Affiliate Group the number of
Series A Preferred Units to be redeemed from each Investor in such Affiliate
Group (and the corresponding Redemption Payment to be made to each such
Investor) in the Redemption; provided, that such new allocations shall not
result in any change to the aggregate number of Series A Preferred Units to be
redeemed from all Investors in such Affiliate Group in the Redemption as set
forth on Schedule I.

 

2.2          Closing. Upon the terms and subject to the conditions hereof, the
consummation of the Restructuring (the “Closing”) shall take place on the same
date (the “Closing Date”) as, and concurrently with, the closing of the Merger,
at the offices of Latham & Watkins LLP at 811 Main Street, Suite 3700, Houston,
Texas 77002.

 

2.3           No Further Rights in Series A Preferred Units. Each Investor
hereby acknowledges and agrees that, upon surrender of such Investor’s Series A
Preferred Units to the Partnership Transfer Agent and receipt of both the
Redemption Payment and Series A Preferred Shares in accordance with the terms
hereof, such Investor’s rights pursuant to Section 2.1 of this Agreement and
Section 5.11(b)(vi) of the Partnership Agreement will be deemed to have been
satisfied, and any rights, preferences and privileges afforded to the Investor
in the Partnership Agreement as a holder of Series A Preferred Units shall also
be automatically canceled and cease to exist.

 

2.4           NYSE. The Company hereby acknowledges and agrees that, prior to
the consummation of the Restructuring, the New York Stock Exchange shall have
authorized, upon official notice of issuance, the listing of the Common Shares
issuable upon conversion of the Series A Preferred Shares in accordance with the
Certificate of Designations (the “Conversion Shares”).

 

2.5           Support of Merger. In accordance with Section 5.11(b)(ii)(C)(1) of
the Partnership Agreement, each Investor hereby acknowledges and agrees that
such Investor will vote, or cause to be voted, all Series A Preferred Units
owned (beneficially or of record) by such Investor in favor of the Merger and
the Merger Agreement at the special meeting of the limited partners of the
Partnership for the purposes of considering and voting upon approval of the
Merger and the Merger Agreement; provided, however, that no Investor shall be
required to comply with the provisions of this Section 2.5 if (a) the
Partnership is in violation, breach or default (or, with the giving of notice or
lapse of time, would be in violation, breach or default) under any provision of
its Organizational Documents or this Agreement or (b) the Company or the
Partnership is in violation, breach or default (or, with the giving of notice or
lapse of time, would be in violation, breach or default) under any of the
Restructuring Documents, except, in the case of clauses (a) and (b), where such
breaches, violations or defaults, individually or in the aggregate, would not
reasonably be likely to materially impair the ability of the Company or the
Partnership to consummate the transactions contemplated by the Merger Agreement
or this Agreement.

 

2.6          Restrictions on Transfer. Until the earlier of (i) the Closing and
(ii) the termination of this Agreement, each Investor shall not transfer any of
its Series A Preferred Units unless (a) such transfer complies with the terms
and conditions of the Partnership Agreement and (b) any assignee of such
transferred Series A Preferred Units executes a Joinder Agreement to this
Agreement in the form attached hereto as Exhibit F. Notwithstanding anything to
the contrary herein, in the event that prior to the Closing any lender, other
creditor or counterparty under any Permitted Loan transaction (including any
agent or trustee on their behalf) or any Affiliate of the foregoing (A)
exercises any rights or remedies under such Permitted Loan on foreclosure or
other exercise of remedies or rights in respect of any pledged Series A
Preferred Units and (B) converts any or all of such pledged Series A Preferred
Units into Series A Conversion Units in accordance with Section 5.11(b)(v)(A) of
the Partnership Agreement, then Section 3.2(b) and Schedule I of this Agreement
shall each be appropriately adjusted to reflect such reduction in the number of
outstanding Series A Preferred Units and corresponding reduction in the Series A
Preferred Shares to be issued at the Closing. In the event any such lender,
creditor or counterparty converts less than all Series A Preferred Units held by
such Person, the resulting reduction to the number of “Redeemed Series A
Preferred Units” and “Series A Preferred Units Not Redeemed” as set forth
opposite the applicable Investor’s name on Schedule I shall be made pro rata.

 

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2.7          Registration Rights Agreement.  Each Investor, the Partnership and
the Company, as applicable, hereby agree that, if the Closing occurs and the
Series A Preferred Shares are issued to the Investors, then (a) effective as of
the Closing, their respective rights under that certain Registration Rights
Agreement, dated as of April 10, 2019, by and among the Partnership and the
Investors shall terminate without any further action on the part of the
Partnership or any Investor, and (b) on the Closing, the Company and each of the
Investors shall execute and deliver a Registration Rights Agreement in
substantially the form attached hereto as Exhibit A (the “Registration Rights
Agreement”).

 

2.8          DTC Eligibility. The Company will cooperate with the Investors and
use its commercially reasonable efforts to cause the Series A Preferred Shares
to be eligible for clearance and settlement through the facilities of DTC by the
earlier of the twentieth (20th) Business Day following the Closing or the time
by which the Series A Preferred Shares have been registered under the Securities
Act.

 

2.9          Certificate of Designations.  Immediately following the Closing,
the Company shall file with the Secretary of State of Pennsylvania a Statement
with Respect to Shares amending the Company Articles to establish the Series A
Preferred Stock as contemplated by the Certificate of Designations, which shall
be attached to such Statement with Respect to Shares. The Certificate of
Designations shall set forth the designations, preferences and relative,
participating, optional or other special rights, privileges, powers, duties and
obligations of the Series A Preferred Shares in accordance with Section 1.1 of
the Amended and Restated Articles of the Company.

 

2.10        Deliverables of the Company.  At the Closing, the Company shall
deliver, or cause to be delivered, to each Investor:

 

(a)                 a duly executed Certificate of Designations;

 

(b)                a counterpart of the Registration Rights Agreement duly
executed by the Company;

 

(c)                evidence of the Series A Preferred Shares being credited to
book-entry accounts maintained by the Company Transfer Agent, bearing the legend
set forth in Section 10(a)(iii) of the Certificate of Designations;

 

(d)                an opinion from McGuireWoods LLP, Pennsylvania counsel for
the Company, in substantially the form attached hereto as Exhibit C, which shall
be addressed to the Investors and dated the Closing Date;

 

(e)                an opinion from Latham & Watkins LLP, counsel for the
Company, in substantially the form attached hereto as Exhibit D, which shall be
addressed to the Investors and dated the Closing Date;

 

(f)                 a certificate of the Secretary of State of the State of
Pennsylvania, dated as of the Closing Date or a recent date prior thereto, to
the effect that the Company is in good standing in the State of Pennsylvania;

 

(g)                a certificate signed by an authorized signatory of the
Company, dated as of the Closing Date, to the effect that (i) the
representations and warranties of the Company set forth in Article III hereto
are true and correct, both when made and as of the Closing Date and (ii) the
Company has performed in all material respects all of the covenants required to
be performed by the Company hereunder on or prior to the Closing Date; and

 

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(h)                a certificate, dated as of the Closing Date, of the Secretary
or Assistant Secretary of the Company certifying as to (i) the Company Articles,
(ii) the bylaws of the Company, as amended, (iii) resolutions of the board of
directors of the Company authorizing the execution and delivery of the
Restructuring Documents and the consummation of the transactions contemplated
thereby, including the Restructuring, and (iv) the incumbency of the officers
authorized to execute the Restructuring Documents on behalf of the Company,
setting forth the name and title and bearing the signatures of such officers,
each as in effect as of the Closing.

 

2.11        Deliverables of the Partnership.  At the Closing, the Partnership
shall deliver, or cause to be delivered, to each Investor:

 

(a)                payment of such Investor’s Redemption Payment, payable by
wire transfer of immediately available funds to an account designated at least
five Business Days in advance of the Closing Date by such Investor;

 

(b)                a certificate signed by an authorized signatory of the
Partnership, dated as of the Closing Date, to the effect that (i) the
representations and warranties of the Partnership set forth in Article IV hereto
are true and correct, both when made and as of the Closing Date and (ii) the
Partnership has performed in all material respects all of the covenants required
to be performed by such Investor hereunder on or prior to the Closing Date; and

 

(c)                a certificate, dated as of the Closing Date, of the Secretary
or Assistant Secretary of the General Partner certifying as to (i) resolutions
of the board of directors of the General Partner authorizing the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby, including the Restructuring, and (ii) the incumbency of the officers
authorized to execute this Agreement on behalf of the Partnership, setting forth
the name and title and bearing the signatures of such officers, each as in
effect as of the Closing.

 

2.12        Deliverables of the Investors.  At the Closing, each Investor shall
deliver, or cause to be delivered, to the Company:

 

(a)                 a counterpart of the Registration Rights Agreement duly
executed by such Investor;

 

(b)                a duly executed Internal Revenue Service Form W-9 from such
Investor;

 

(c)                a properly executed affidavit prepared in accordance with
Treasury Regulations Section 1.1445-2(b) certifying such Investor’s non-foreign
status;

 

(d)                instructions and/or other instruments of transfer, in form
and substance reasonably satisfactory to the Partnership Transfer Agent, duly
executed by such Investor, surrendering the number of Series A Preferred Units
set forth opposite such Investor’s name under the heading “Series A Preferred
Units” on Schedule I hereto to the Partnership Transfer Agent; and

 

(e)                a certificate signed by an authorized signatory of such
Investor, dated as of the Closing Date, to the effect that (i) the
representations and warranties of such Investor set forth in Article V hereto
are true and correct, both when made and as of the Closing Date and (ii) such
Investor has performed in all material respects all of the covenants required to
be performed by such Investor hereunder on or prior to the Closing Date.

 

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2.13        Withholding.  Each of the Company, the Partnership, the Company
Transfer Agent and the Partnership Transfer Agent are entitled to deduct and
withhold from any amounts payable in cash or property pursuant to this Agreement
to any Person such amounts as it is required to deduct and withhold under
applicable Law with respect to the making of such payment; provided, however,
that the Company and the Partnership shall use commercially reasonable efforts
to notify such Person in advance of any such deduction and withholding and
cooperate with such Person, at such Person’s expense, to reduce or eliminate any
such deduction and withholding. Such deduction and withholding may be taken in
securities, in which case the Company, the Partnership, the Company Transfer
Agent or the Partnership Transfer Agent, as applicable, shall be treated as
having sold such securities for an amount of cash equal to the fair market value
of such securities at the time of such deemed sale as reasonably determined by
the Company, the Partnership, the Company Transfer Agent or the Partnership
Transfer Agent, as applicable. To the extent that deducted and withheld amounts
(including deemed proceeds from the deemed sale of securities) are paid over to
the appropriate Governmental Authority, such amounts (including securities) will
be treated for all purposes of this Agreement as having been paid or issued to
the Person in respect of which such deduction and withholding was made.

 

2.14        Tax Treatment.  For U.S. federal income Tax purposes (and for
purposes of any applicable state, local or foreign Tax that follows the U.S.
federal income Tax treatment), the Parties agree (1) to treat the Redemption as
a distribution described in Section 731 of the Code, (2) to treat the exchange
of Series A Preferred Units for Series A Preferred Shares as a taxable sale of
the Series A Preferred Units by the Investors to the Company and (3) not to
treat the Series A Preferred Shares as “preferred stock” under Section 305 of
the Code and the Treasury Regulations thereunder. Following the Closing, the
Parties shall cooperate in good faith to determine the fair market value of the
Series A Preferred Shares received by the Investors. The Parties will prepare
and file all Tax Returns consistent with the agreed treatment set forth in this
Section 2.14 and the fair market value determination pursuant to the foregoing
sentence and will not take any inconsistent position on any Tax Return, or
during the course of any proceeding with respect to Taxes, except as otherwise
required by applicable Law following a final determination by a court of
competent jurisdiction or other administrative settlement with or final
administrative decision by the relevant Governmental Authority.

 

Article III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

Except as set forth in the schedules accompanying this Agreement (each, a
“Company Schedule” and, collectively, the “Company Disclosure Schedule”), the
Company represents and warrants to the Investors that:

 

3.1          Formation and Qualification of the Company Entities. Each of the
Company Entities has been duly formed and is validly existing as a corporation,
limited partnership or limited liability company, as applicable, in good
standing under the Laws of its jurisdiction of organization with all requisite
power and authority, in the case of the Company, to enter into and perform its
obligations under this Agreement, and to consummate the transactions
contemplated hereby. Each of the Company Entities has all requisite power and
authority to own or lease and to operate its properties currently owned or
leased and conduct its business as currently conducted and is duly qualified to
do business as a foreign corporation, limited partnership or limited liability
company, as applicable, and is in good standing under the Laws of each
jurisdiction which requires such qualification, except where the failure to be
so qualified would not reasonably be likely to have a Material Adverse Effect.

 

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3.2          Capitalization; Issuance.

 

(a)           As of February 25, 2020, the Company has no capital stock or other
equity securities outstanding other than 254,968,290 Common Shares. All such
Common Shares have been duly authorized and validly issued in accordance with
the Company Articles and are fully paid (to the extent required under the
Company Articles) and nonassessable.

 

(b)           As of the Closing, after giving effect to the Merger and the
Restructuring, the Company shall have capital stock or other equity securities
outstanding in an aggregate amount no more than the sum of 30,018,446 Series A
Preferred Shares issued to the Investors under this Agreement, 254,968,290
Common Shares issued and outstanding as the date hereof, and any capital stock
or equity securities (i) to be issued as consideration to unitholders of the
Partnership in connection with the Merger and (ii) permitted to be issued by the
Company pursuant to Section 6.2(b) of the Merger Agreement.

 

(c)           The Series A Preferred Shares will be duly authorized by the
Company pursuant to the Company Articles prior to the Closing and the
Certificate of Designations as of the Closing, and, when issued and delivered to
the Investors in exchange for the applicable Series A Preferred Units in
accordance with the terms of this Agreement, will be validly issued, fully paid
and nonassessable and will be free of any and all Liens and restrictions on
transfer, other than (i) restrictions on transferability that may be imposed by
federal or state securities Laws or contained in the Company Articles, the
Certificate of Designations or this Agreement and (ii) such Liens as are created
by the Investors.

 

(d)           Except (i) for the Series A Preferred Shares to be issued pursuant
to this Agreement, (ii) as expressly provided in the Company Articles or (iii)
as disclosed in the SEC Documents or as have been awarded pursuant to the
Equitrans Midstream Corporation 2018 Long-Term Incentive Plan or the Equitrans
Midstream Corporation Directors’ Deferred Compensation Plan, no options,
warrants or other rights to purchase, agreements or other obligations to issue,
or rights to convert any obligations into or exchange any securities for,
securities or ownership interests in the Company are outstanding.

 

(e)           The Certificate of Designations sets forth the rights, preferences
and priorities of the Series A Preferred Shares, and the holders of the Series A
Preferred Shares will have the rights set forth in the Certificate of
Designations upon the Closing.

 

3.3          Authority and Authorization. The Company has all requisite power
and authority to execute and deliver this Agreement and the Restructuring
Documents and perform its respective obligations hereunder and thereunder. The
Company has all requisite corporate power and authority to issue, sell and
deliver the Series A Preferred Shares, in accordance with and upon the terms and
conditions set forth in this Agreement and the Certificate of Designations.

 

3.4          Authorization of this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company and each of the other
Restructuring Documents has been duly and validly authorized and has been or,
with respect to the Restructuring Documents to be delivered at the Closing, will
be, validly executed and delivered by the Company. Each of the Restructuring
Documents constitutes, or will constitute, the legal, valid and binding
obligations of the Company enforceable in accordance with its terms; provided,
that, with respect to each such agreement, the enforceability thereof may be
limited by the Enforceability Exceptions.

 

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3.5          No Conflicts. None of the issuance or sale by the Company of the
Series A Preferred Shares, the execution, delivery and performance of this
Agreement or the other Restructuring Documents by the Company, or the
consummation of any other transactions contemplated thereby (i) conflicts or
will conflict with or constitutes or will constitute a violation of the
Organizational Documents of any of the Company Entities, (ii) assuming the
amendments, restatements, amendments and restatements, replacement,
terminations, waivers, consents and/or modifications referred to in Section 3.5
of the Company Disclosure Schedules are effective, conflicts or will conflict
with or constitutes or will constitute a breach or violation of, or a default
(or an event that, with notice or lapse of time or both, would constitute such a
default) under, accelerate payment or rights under, or will result in the
creation or imposition of any Lien upon any property or Assets of any of the
Company Entities under, any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument to which any of the Company Entities is a
party or by which any of them or any of their respective properties may be bound
or (iii) violates or will violate any statute, Law or regulation or any order,
judgment, decree or injunction of any court or governmental agency or body
having jurisdiction over any of the Company Entities or any of their properties
in a proceeding to which any of them or their property is a party, or any rule
of regulation of any self-regulatory organization or other non-governmental
regulatory authority (including, without limitation, the rules and regulations
of the NYSE) except, in the case of clauses (ii) and (iii), where such breaches,
violations, defaults or Liens would not, individually or in the aggregate,
reasonably be likely to have a Material Adverse Effect or materially impair the
ability of the Company to consummate the transactions contemplated by the
Restructuring Documents.

 

3.6          Organizational Documents. The Organizational Documents of each of
the Company Entities have been, and in the case of the Certificate of
Designations, at the Closing will be, duly authorized and validly executed and
delivered by the parties thereto and are, and in the case of the Certificate of
Designations, at the Closing will be, valid and legally binding agreements of
such party, enforceable against such party in accordance with their respective
terms; provided, that, with respect to each Organizational Document described in
this Section 3.6, the enforceability thereof may be limited by the
Enforceability Exceptions.

 

3.7          No Integration. Neither the Company nor any of its Affiliates, nor,
to the Company’s Knowledge, any Representative of the foregoing has, directly or
indirectly, made any offers or sales of any security of the Company or solicited
any offers to buy any security of the Company, under circumstances that would
adversely affect reliance by the Company on Section 4(a)(2) of the Securities
Act for the exemption from the registration requirements imposed under Section 5
of the Securities Act for the transactions contemplated hereby or that would
require such registration under the Securities Act.

 

3.8          No Consents. No permit, consent, waiver, license, written exemption
from, approval, authorization, order, registration, filing or qualification of
or with any court, governmental agency or body or any self-regulatory
organization or other non-governmental regulatory authority (including, without
limitation, the NYSE) having jurisdiction over any of the Company Entities or
any of their properties or Assets or approval of the security holders of the
Company Entities, is required in connection with the issuance by the Company of
the Series A Preferred Shares, the execution, delivery and performance of the
Restructuring Documents by the Company or the consummation of the transactions
contemplated by the Restructuring Documents by the Company, other than consents
(a) required by the Commission in connection with the Company’s obligations
under the Registration Rights Agreement, (b) required by the shareholders of the
Company in connection with the Merger pursuant to the rules of the NYSE,
(c) required under state securities or “Blue Sky” Laws, (d) that have been, or
prior to the Closing Date will be, obtained and (e) that, the absence or
omission of which would not, individually or in the aggregate, have a Material
Adverse Effect.

 

3.9          SEC Documents. Since January 1, 2019, all the Company’s forms,
registration statements, reports, schedules and statements required to be filed
by it under the Exchange Act have been filed with the Commission on a timely
basis. Since the filing date of the Company’s Annual Report on Form 10-K for the
year ended December 31, 2018, the SEC Documents, at the time filed (or in the
case of registration statements, solely on the dates of effectiveness), except
to the extent corrected by a subsequent SEC Document, (a) did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made in the case of any such
documents other than a registration statement, not misleading and (b) complied
as to form in all material respects with the applicable requirements of the
Exchange Act or the Securities Act, as the case may be.

 

12

 

 

3.10        Financial Statements.

 

(a)           The historical financial statements and schedules of the Company
(together with its consolidated or combined subsidiaries) included in or
incorporated by reference in the SEC Documents present fairly the financial
condition, results of operations and cash flows of the entities purported to be
shown thereby on the basis stated therein as of the dates and for the periods
indicated, comply as to form with the applicable accounting requirements under
the Securities Act and the Exchange Act and have been prepared in conformity
with GAAP in the United States applied on a consistent basis throughout the
periods involved (except as otherwise noted therein). The other financial
information of the Company Entities, including non-GAAP financial measures, if
any, contained or incorporated by reference in the SEC Documents has been
derived from the accounting records of the Company Entities and fairly presents
in all material respects the information purported to be shown thereby. Nothing
has come to the attention of the Company that has caused it to believe that the
statistical and market-related data included in the SEC Documents is not based
on or derived from sources that are reliable and accurate in all material
respects as of the date of such information. There are no financial statements
(historical or pro forma) that are required to be included in or incorporated by
reference in the SEC Documents that are not so included as required; other than
as set forth in Section 3.10(a) of the Company Disclosure Schedules, the Company
Entities do not have any material liabilities or obligations, direct or
contingent (including any off balance sheet obligations), not described in the
SEC Documents; and all disclosures contained in the SEC Documents regarding
“non-GAAP financial measures” (as such term is defined by the rules and
regulations of the Commission) comply with Regulation G and Item 10 of
Regulation S-K under the Exchange Act, to the extent applicable.

 

(b)           Since the date of the most recent balance sheet of the Company
audited by the Company’s auditor, (i) the interactive data in eXtensible
Business Reporting Language included or incorporated by reference in the SEC
Documents fairly presents the information called for in all material respects
and has been prepared in accordance with the Commission’s rules and guidelines
applicable thereto in all material respects and (ii) based on an annual
evaluation of disclosure controls and procedures, the Company is not aware of
(A) any significant deficiency or material weakness in the design or operation
of internal controls over financial reporting that are likely to adversely
affect its ability to record, process, summarize and report financial data or
(B) any fraud, whether or not material, that involves management or other
employees who have a significant role in the internal controls over financial
reporting of the Company.

 

3.11        Independent Registered Public Accounting Firm. Ernst & Young LLP,
which has audited and certified certain financial statements of the Company and
its consolidated or combined subsidiaries (including the related notes thereto),
included in or incorporated by reference in the SEC Documents is and was during
the periods covered by such financial statements an independent registered
public accounting firm with respect to the Company as required by the Exchange
Act and the Public Company Accounting Oversight Board (United States). Ernst &
Young LLP has not resigned or been dismissed as independent registered public
accountants of the Company as a result of or in connection with any disagreement
with the Company on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedures.

 

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3.12        Investment Company. None of the Company Entities is now, and
immediately following the issuance of the Series A Preferred Shares to be issued
by the Company hereunder and application of the net proceeds from such sale,
none will be, an “investment company” or a company “controlled by” an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended (the “Investment Company Act”).

 

3.13        No Unlawful Payment. No Company Entity nor, to the Knowledge of the
Company, any director, officer, agent, employee or Affiliate of any Company
Entity, has (i) used any funds for any unlawful contribution, gift,
entertainment or other unlawful expense relating to political activity; (ii)
made or taken an act in furtherance of an offer, promise or authorization of any
direct or indirect unlawful payment or benefit to any foreign or domestic
government or regulatory official or employee, including of any government-owned
or controlled entity or of a public international organization, or any person
acting in an official capacity for or on behalf of any of the foregoing, or any
political party or party official or candidate for political office; (iii)
violated or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977, as amended, or any applicable law or regulation implementing the
OECD Convention on Combating Bribery of Foreign Public Officials in
International Business Transactions, or committed an offence under the Bribery
Act 2010 of the United Kingdom, or any other applicable anti-bribery or
anti-corruption laws; or (iv) made, offered, agreed, requested or taken an act
in furtherance of any unlawful bribe or other unlawful benefit, including,
without limitation, any rebate, payoff, influence payment, kickback or other
unlawful or improper payment or benefit. The Company Entities, and to the
Knowledge of the Company, the Affiliates of the Company have instituted, and
maintain and enforce, policies and procedures designed to promote and ensure
compliance with all applicable anti-bribery and anti-corruption Laws.

 

3.14        Money Laundering Laws. The operations of the Company Entities are
and have been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements, including those of the Currency and
Foreign Transactions Reporting Act of 1970, as amended, the applicable money
laundering statutes of all jurisdictions where the Company Entities conduct
business, the rules and regulations thereunder and any related or similar rules,
regulations or guidelines issued, administered or enforced by any governmental
or regulatory agency (collectively, the “Anti-Money Laundering Laws”) and no
action, suit or proceeding by or before any court or governmental or regulatory
agency, authority or body or any arbitrator involving any Company Entity with
respect to the Anti-Money Laundering Laws is pending or, to the Knowledge of the
Company, threatened.

 

3.15        No Conflicts with Sanctions Laws. No Company Entity nor, to the
Knowledge of the Company, any director, officer, employee or Affiliate of any
Company Entity, is currently the subject or the target of any sanctions
administered or enforced by the U.S. Government (including, without limitation,
the Office of Foreign Assets Control of the U.S. Department of the Treasury or
the U.S. Department of State and including, without limitation, the designation
as a “specially designated national” or “blocked person”), the United Nations
Security Council, the European Union, Her Majesty’s Treasury, or other relevant
sanctions authority (collectively, “Sanctions”), nor is any Company Entity
located, organized or resident in a country or territory that is the subject or
the target of Sanctions, including, without limitation, Cuba, Iran, North Korea,
Sudan, Syria and the Crimea region of Ukraine (each, a “Sanctioned Country”);
and the Company Entities will not directly or indirectly use the proceeds of the
sale of the Series A Preferred Shares hereunder, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner
or other person or entity (i) to fund or facilitate any activities of or
business with any person that, at the time of such funding or facilitation, is
the subject or the target of Sanctions, (ii) to fund or facilitate any
activities of or business in any Sanctioned Country or (iii) in any other manner
that will result in a violation by any person (including any person
participating in the transaction, whether as underwriter, advisor, investor or
otherwise) of Sanctions. For the past five years, none of the Company Entities
have knowingly engaged in and are not now knowingly engaged in any dealings or
transactions with any person that at the time of the dealing or transaction is
or was the subject or the target of Sanctions or with any Sanctioned Country.

 

14

 

 

3.17         NYSE Listing. The Common Shares are listed on the NYSE, and the
Company has not received any notice of delisting. The issuance and sale of the
Series A Preferred Shares hereunder and issuance of Common Shares upon
conversion of the Series A Preferred Shares do not contravene NYSE rules and
regulations.

 

3.18        No Investor Side Agreements. Except as previously disclosed in
writing to each Person who is an Investor as of the date hereof or as set forth
in Section 3.18 of the Company Disclosure Schedules, there are no binding
agreements by, among or between the Company Entities or any of their Affiliates,
on the one hand, and any Investor or any of their Affiliates, on the other hand,
with respect to the transactions contemplated hereby, other than the
Restructuring Documents.

 

Article IV
REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP

 

Except as set forth in the schedules accompanying this Agreement (each, a
“Partnership Schedule” and, collectively, the “Partnership Disclosure
Schedule”), the Partnership represents and warrants to the Investors that:

 

4.1           Authority and Authorization. The Partnership has all requisite
power and authority to execute and deliver this Agreement and perform its
respective obligations hereunder. The Partnership has all requisite partnership
power and authority to redeem in cash the Series A Preferred Units. No approval
from the holders of outstanding Common Units is required under the Partnership
Agreement or the rules of the NYSE in connection with the Redemption.

 

4.2          Authorization of this Agreement. This Agreement has been duly
authorized, executed and delivered by the Partnership or the General Partner, as
the case may be. This Agreement constitutes, or will constitute, the legal,
valid and binding obligation of the Partnership or the General Partner, as the
case may be, enforceable in accordance with its terms; provided, that, with
respect to such agreement, the enforceability thereof may be limited by the
Enforceability Exceptions.

 

4.3          No Consents. No permit, consent, waiver, license, written exemption
from, approval, authorization, order, registration, filing or qualification of
or with any court, governmental agency or body or any self-regulatory
organization or other non-governmental regulatory authority (including, without
limitation, the NYSE) having jurisdiction over any of the Partnership Entities
or any of their properties or Assets or approval of the security holders of the
Partnership Entities, is required in connection with the Redemption, the
execution, delivery and performance of the Restructuring Documents by the
Partnership or the consummation of the transactions contemplated by this
Agreement by the Partnership, other than consents (a) that have been, or prior
to the Closing Date will be, obtained and (b) consents, the absence or omission
of which would not, individually or in the aggregate, have a Material Adverse
Effect (as defined in the Preferred Purchase Agreement).

 

4.4          No Investor Side Agreements. Except as previously disclosed in
writing to each Person who is an Investor as of the date hereof or as set forth
in Section 4.4 of the Partnership Disclosure Schedules, there are no binding
agreements by, among or between the Partnership Entities or any of their
Affiliates, on the one hand, and any Investor or any of their Affiliates, on the
other hand, with respect to the transactions contemplated hereby, other than the
Restructuring Documents.

 

15

 

 

 

Article V

REPRESENTATIONS AND WARRANTIES OF THE INVESTORS

 

Each of the Investors, severally but not jointly, represents and warrants to the
Company and the Partnership that:

 

5.1          Existence. Such Investor is duly organized, validly existing and in
good standing under the Laws of its jurisdiction of organization, with full
power and authority to own, lease, use and operate its properties and to conduct
its business as currently conducted.

 

5.2          Authority. Such Investor has all requisite power and authority to
enter into, deliver and perform its obligations under the Restructuring
Documents, and has the right to vote and dispose of, all of the Series A
Preferred Units set forth opposite such Investor’s name under the heading
“Series A Preferred Units” on Schedule I hereto. All corporate, limited
liability company or partnership action required to be taken by such Investor or
any of its members or partners for the consummation of the transactions
contemplated by the Restructuring Documents has been validly taken. The
Restructuring Documents, as applicable, have been or will be duly executed and
delivered by such Investor and constitute, or with respect to Restructuring
Documents to be executed following the date hereof, will constitute legal, valid
and binding obligations of such Investor, enforceable in accordance with their
terms, except as such enforceability may be limited by the Enforceability
Exceptions.

 

5.3          No Conflicts. The execution, delivery and performance of the
Restructuring Documents to which such Investor is a party by such Investor and
the consummation by such Investor of the transactions contemplated thereby will
not (i) conflict with, or constitute a violation of or require the consent of
any Person under, any of the terms, conditions or provisions of the
Organizational Documents of such Investor, (ii) conflict with, or constitute a
breach or violation of, or a default (or an event which, with notice or lapse of
time or both, would constitute such a default) under, any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument to which
such Investor is a party or by which it or any of its properties may be bound,
(iii) violate any statute, Law or regulation or any order, judgment, decree or
injunction of any court or governmental agency or body directed to such Investor
or any of its properties in a proceeding to which it is a party or by which any
of its property is subject or (iv) result in the creation or imposition of any
Lien upon any property of such Investor, which conflicts, breaches, violations,
defaults or Liens, in the case of clauses (ii), (iii) or (iv), could materially
impair the ability of such Investor to perform its obligations under the
Restructuring Documents or consummate the transactions contemplated thereby.

 

5.4          Litigation. There is no action, suit or proceeding before or by any
federal or state court, commission, arbitrator or governmental or regulatory
agency, body or official, domestic or foreign, now pending or, to the knowledge
of such Investor, threatened, to which such Investor is or may be a party or to
which the business or property of such Investor is or may be subject that is
reasonably likely to (i) individually or in the aggregate have a material
adverse effect on the business, prospects, financial condition or results of
operations of such Investor, taken as a whole, (ii) prevent the consummation of
the transactions contemplated by the Restructuring Documents or (iii) in any
manner draw into question the validity of the Restructuring Documents.

 

5.5          Unregistered Securities.

 

(a)          Investment Intent. Such Investor is acquiring the Series A
Preferred Shares for its own account with the present intention of holding
Series A Preferred Shares for investment purposes and not with a view to, or for
offer or sale in connection with, any distribution thereof in violation of the
Securities Act or state securities Laws. Other than with respect to any
transfers of Series A Preferred Shares as may be made to Affiliates of such
Investor after the date hereof in accordance with the terms and conditions of
the Certificate of Designations, such Investor does not presently have any
contract, undertaking, agreement or arrangement with any Person to sell,
transfer or grant participations to such Person or to any third Person, with
respect to such Series A Preferred Shares.

 

16

 

 

(b)          Accredited Investor Status; Sophisticated Investor. Such Investor
is an “accredited investor” within the meaning of Rule 501 of Regulation D
promulgated by the Commission pursuant to the Securities Act. Such Investor has
such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risk of an investment in such Series A
Preferred Shares and the Conversion Shares, is able to bear the economic risk of
such investment and, at the present time, would be able to afford a complete
loss of such investment.

 

(c)          Information. Such Investor and its Representatives have been
furnished with all materials relating to the business, finances and operations
of the Company and its subsidiaries and materials relating to the Series A
Preferred Shares and the Conversion Shares that such Investor has requested.
Such Investor and its Representatives have been afforded the opportunity to ask
questions of and speak with members of management of the Company. Neither such
inquiries nor any other due diligence investigations conducted at any time by
such Investor and its Representatives shall modify, amend or affect such
Investor’s right (i) to rely on the Company’s representations and warranties
contained in Article III or (ii) to indemnification or any other remedy based
on, or with respect to the accuracy or inaccuracy of, or compliance with, the
representations, warranties, covenants and agreements in this Agreement. Such
Investor has sought such accounting, legal and Tax advice as it has considered
necessary to make an informed investment decision with respect to its
acquisition of the Series A Preferred Shares.

 

(d)          Securities Not Registered. Such Investor acknowledges that the
Series A Preferred Shares and the Conversion Shares are not currently registered
under the Securities Act or any applicable state securities law and might not be
registered in the future, and that such Series A Preferred Shares and, upon
their conversion, the Conversion Shares may not be transferred or sold except
pursuant to the registration provisions of the Securities Act or pursuant to an
applicable exemption therefrom and pursuant to state securities laws and
regulations as applicable.

 

(e)          Legends. Such Investor understands that, until such time as the
Series A Preferred Shares have been registered pursuant to the provisions of the
Securities Act, or the Series A Preferred Shares are otherwise eligible for
resale under the Securities Act (including pursuant to Rule 144 promulgated
thereunder) without any restriction as to the number of securities as of a
particular date that can then be immediately sold, the Series A Preferred Shares
will bear a restrictive legend. Such Investor understands that, until such time
as the Conversion Shares have been registered pursuant to the provisions of the
Securities Act, or the Conversion Shares are otherwise eligible for resale under
the Securities Act (including pursuant to Rule 144 promulgated thereunder)
without restriction as to the number of securities as of a particular date that
can then be immediately sold, the Conversion Shares will bear a restrictive
legend.

 

(f)          Reliance by the Company. Such Investor understands that the Company
is offering the Series A Preferred Shares in reliance on a transactional
exemption from the registration requirements of federal and state securities
laws and that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of
such Investor set forth herein in order to determine the applicability of such
exemptions and the suitability of such Investor to acquire the Series A
Preferred Shares and the Conversion Shares issuable upon conversion thereof.

 

5.6          Series A Preferred Units. Such Investor is the holder (record or
beneficial) of, and has the right to vote and dispose of, all of the Series A
Preferred Units set forth opposite such Investor’s name under the heading
“Series A Preferred Units” on Schedule I hereto.

 

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Article VI

INDEMNIFICATION, COSTS AND EXPENSES

 

6.1          Indemnification by the Company. Subject to the limitations set
forth in this Agreement, the Company agrees to indemnify each Investor and its
Affiliates and Representatives (collectively, “Investor Related Parties”) from,
and hold each of them harmless against, any and all losses, actions, suits,
proceedings (including any investigations, litigation or inquiries), demands and
causes of action, and, in connection therewith, and promptly upon demand, pay or
reimburse each of them for all reasonable costs, losses, liabilities, Taxes,
damages, or expenses of any kind or nature whatsoever, including, without
limitation, the reasonable fees and disbursements of counsel and all other
reasonable expenses incurred in connection with investigating, defending or
preparing to defend any such matter that may be incurred by them or asserted
against or involve any of them, whether or not involving a third party claim, as
a result of, arising out of, or in any way related to the breach of any of the
representations, warranties or covenants of the Company contained herein;
provided, that any such claim for indemnification relating to a breach of any
representation or warranty is made prior to the expiration of such
representation or warranty (it being understood that (x) for purposes of
determining when an indemnification claim has been made, the date upon which an
Investor Related Party has given notice (stating in reasonable detail the basis
of the claim for indemnification) to the Company shall constitute the date upon
which such claim has been made and (y) the aggregate liability of the Company
(i) to each Investor pursuant to this Section 6.1 shall not exceed the amount of
such Investor’s respective Funding Obligation (as defined in the Preferred
Purchase Agreement) and (ii) to all Investors pursuant to this Section 6.1 shall
not exceed the Total Funding Obligation (as defined in the Preferred Purchase
Agreement)); provided, further, that no Investor Related Party shall be entitled
to recover special, indirect, exemplary, incidental, lost profits, speculative
or punitive damages.

 

6.2          Indemnification by the Investors. Subject to the limitations set
forth in this Agreement, each Investor agrees, severally and not jointly, to
indemnify the Company and its respective Representatives (collectively, “Company
Related Parties”) from, and hold each of them harmless against, any and all
losses, actions, suits, proceedings (including any investigations, litigation or
inquiries), demands and causes of action, and, in connection therewith, and
promptly upon demand, pay or reimburse each of them for all reasonable costs,
losses, liabilities, damages, or expenses of any kind or nature whatsoever,
including, without limitation, the reasonable fees and disbursements of counsel
and all other reasonable expenses incurred in connection with investigating,
defending or preparing to defend any such matter that may be incurred by them or
asserted against or involve any of them, whether or not involving a third party
claim, as a result of, arising out of, or in any way related to the breach of
any of the representations, warranties or covenants of such Investor contained
herein; provided, that such claim for indemnification relating to a breach of
any representation or warranty is made prior to the expiration of such
representation or warranty (it being understood that (x) for purposes of
determining when an indemnification claim has been made, the date upon which a
Company Related Party has given notice (stating in reasonable detail the basis
of the claim for indemnification) to such Investor shall constitute the date
upon which such claim has been made and (y) the liability of each such Investor
shall not exceed the amount equal to the sum of such Investor’s respective
Funding Obligation (as defined in the Preferred Purchase Agreement), plus any
distributions paid to such Investor with respect to the Series A Preferred
Units, Series A Preferred Shares and any Conversion Shares); provided, further,
that no Company Related Party shall be entitled to recover special, indirect,
exemplary, incidental, speculative or punitive damages.

 

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6.3          Indemnification Procedures.

 

(a)          Promptly after any Company Related Party or Investor Related Party
(hereinafter, the “Indemnified Party”) discovers facts giving rise to a claim
for indemnification hereunder, including receipt by it of notice of any
indemnifiable claim hereunder, or the commencement of any action, suit or
proceeding by a third Person, which the Indemnified Party believes in good faith
is an indemnifiable claim under this Agreement, the Indemnified Party shall give
the indemnitor hereunder (the “Indemnifying Party”) written notice of such claim
or the commencement of such action, suit or proceeding. Failure to so notify the
Indemnifying Party will not relieve the Indemnifying Party from any liability it
may have to such Indemnified Party hereunder except to the extent that the
Indemnifying Party is materially prejudiced by such failure. Such notice shall
state the nature and the basis of such claim to the extent then known and shall
include a formal demand for indemnification under this Agreement. The
Indemnifying Party shall have the right to defend and settle any such matter, at
its own expense and by its own counsel (provided, that such counsel is
reasonably satisfactory to the Indemnified Party), as long as the Indemnifying
Party pursues the same diligently and in good faith. If the Indemnifying Party
undertakes to defend or settle such claim, it shall promptly notify the
Indemnified Party of its intention to do so, and the Indemnified Party shall
cooperate with the Indemnifying Party and its counsel in all commercially
reasonable respects in the defense thereof and the settlement thereof. Such
cooperation shall include, but shall not be limited to, furnishing the
Indemnifying Party with any books, records and other information reasonably
requested by the Indemnifying Party and in the Indemnified Party’s possession or
control. Such cooperation of the Indemnified Party shall be at the cost of the
Indemnifying Party. After the Indemnifying Party has notified the Indemnified
Party of its intention to undertake to defend or settle any such matter, and for
so long as the Indemnifying Party diligently pursues such defense, the
Indemnifying Party shall not be liable for any additional legal expenses
incurred by the Indemnified Party in connection with any defense or settlement
of such asserted liability; provided, however, that the Indemnified Party shall
be entitled (i) at its expense, to participate in the defense of such matter and
the negotiations of the settlement thereof and (ii) if (A) the Indemnifying
Party has failed to assume the defense and employ counsel reasonably
satisfactory to the Indemnified Party within 30 days of when the Indemnified
Party has provided written notice of the claim for indemnification or (B) if the
defendants in any such action include both the Indemnified Party and the
Indemnifying Party and counsel to the Indemnified Party shall have concluded
that there may be reasonable defenses available to the Indemnified Party that
are different from or in addition to those available to the Indemnifying Party
or if the interests of the Indemnified Party reasonably may be deemed to
conflict with the interests of the Indemnifying Party, then the Indemnified
Party shall have the right to select a separate counsel and to assume such legal
defense and otherwise to participate in the defense of such action, with the
expenses and fees of such separate counsel and other expenses related to such
participation to be reimbursed by the Indemnifying Party as incurred.

 

(b)          Notwithstanding any other provision of this Agreement, the
Indemnifying Party shall not settle any indemnified claim without the consent of
the Indemnified Party, unless the settlement thereof imposes no liability or
obligation on, includes a complete release from liability of, and does not
contain any admission of wrongdoing by, the Indemnified Party.

 

(c)          Notwithstanding the foregoing, the Indemnifying Party shall not be
entitled to assume the defense of any third party indemnity claim (but shall be
liable for the reasonable fees and expenses of counsel incurred by the
Indemnified Party in defending such third party indemnity claim) if the third
party indemnity claim seeks an order, injunction or other equitable relief or
relief for other than money damages against the Indemnified Party which the
Indemnified Party reasonably determines, after conferring with its outside
counsel, cannot be separated from any related claim for money damages. If such
equitable relief or other relief portion of the third party indemnity claim can
be so separated from that for money damages, the Indemnifying Party shall be
entitled to assume the defense of the portion relating to money damages.

 

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6.4          Survival of Provisions. All the provisions of this Agreement shall
survive the Closing, notwithstanding any investigation at any time made by or on
behalf of any Party; provided, that the representations and warranties set forth
in Article III, Article IV and Article V shall terminate and expire on the date
that is 60 days following the date on which the Company files with the
Commission its Annual Report on Form 10-K for fiscal year 2020, except (a) the
representations and warranties of the Company set forth in Section 3.1
(Formation and Qualification of the Company Entities), Section 3.2
(Capitalization; Issuance), Section 3.3 (Authority and Authorization), Section
3.4 (Authorization of this Agreement), Section 3.6 (Organizational Documents)
and Section 3.14 (Money Laundering Laws) (b) the representations and warranties
of the Partnership set forth in Section 4.1 (Authority and Authorization) and
Section 4.2 (Authorization of this Agreement) and (c) the representations and
warranties of each Investor set forth in Section 5.1 (Existence) and Section 5.2
(Authority) shall survive indefinitely. After a representation and warranty has
terminated and expired, no indemnification shall or may be sought pursuant to
this Article VI on the basis of that representation and warranty by any Person
who would have been entitled pursuant to this Article VI to indemnification on
the basis of that representation and warranty prior to its termination and
expiration; provided, that in the case of each representation and warranty that
shall terminate and expire as provided in this Section 6.4, no claim presented
in writing for indemnification pursuant to this Article VI on the basis of that
representation and warranty prior to its termination and expiration shall be
affected in any way by that termination and expiration. The covenants or
agreements entered into pursuant to this Agreement to be performed after the
Closing shall survive the Closing and shall remain in full force and effect
until such covenant or agreement is fully performed in accordance with the terms
of this Agreement.

 

Article VII

MISCELLANEOUS

 

7.1          Further Assurances.  Each of the Company, the Partnership and the
Investors agree to execute and deliver all such documents or instruments, to
take all appropriate action and to do all other things it determines to be
necessary, proper or advisable under applicable Laws and regulations or as
otherwise reasonably requested by the other to consummate the transactions
contemplated by this Agreement; provided, however, that nothing in this
Agreement will require any Party hereto to hold separate or make any divestiture
of any asset or otherwise agree to any restriction on its operations or other
burdensome condition which would in any such case be material to its assets,
liabilities or business in order to obtain any required consent or approval or
other clearance.

 

7.2          Publicity.  Each Investor consents to and authorizes the Company
and the Partnership to include and disclose in any registration statement,
prospectus, current report, proxy statement, or information statement that is
filed with the Commission in connection with the Merger, and in such other
schedules, certificates, applications, agreements, or documents, to be filed
with the Commission or otherwise publicly disclosed, as the Company and the
Partnership reasonably determine to be necessary or appropriate, the identity of
the Investors, the ownership of the Series A Preferred Shares and the nature of
the Parties’ respective commitments, arrangements, and understandings pursuant
to this Agreement and the other Restructuring Documents only after providing the
Lead Investors a reasonable opportunity to review and comment (but only with
respect to any disclosure relating to any such Lead Investor) on any such
registration statement, prospectus, current report, proxy statement, or
information statement that is filed with the Commission in connection with the
Merger, and in such other schedules, certificates, applications, agreements, or
documents, to be filed with the Commission or otherwise publicly disclosed in
connection with the Merger; provided, however, that nothing in this Section 7.2
shall delay any required filing or other disclosure with the Commission or
otherwise hinder the Company’s or the Partnership’s ability to timely comply
with all Laws or rules and regulations of the Commission.

 

7.3          Notices.  All notices and demands provided for hereunder shall be
in writing and shall be given by registered or certified mail, return receipt
requested, telecopy, air courier guaranteeing overnight delivery, via email, or
personal delivery to the following addresses:

 

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if to the Investors, to the addresses set forth on Schedule I hereto.

 

with copies (which shall not constitute notice) to:

 

  Kirkland & Ellis LLP   609 Main Street, Suite 4700   Houston, TX 77002  
Attention: John D. Pitts, P.C.     David Thompson   Email:
john.pitts@kirkland.com     david.thompson@kirkland.com

 

If to the Company:

 

  Equitrans Midstream Corporation   2200 Energy Drive   Canonsburg, PA 15317  
Attention: Kirk R. Oliver     Stephen M. Moore   Email:
koliver@equitransmidstream.com     smoore@equitransmidstream.com

 

with copies (which shall not constitute notice) to:

 

  Latham & Watkins LLP
811 Main Street, Suite 3700   Houston, TX 77002   Attention: Ryan J. Maierson  
  Nick S. Dhesi   Email: ryan.maierson@lw.com     nick.dhesi@lw.com

 

If to the Partnership:

 

  EQM Midstream Partners, LP   2200 Energy Drive   Canonsburg, PA 15317  
Attention: Kirk R. Oliver     Stephen M. Moore   Email:
koliver@equitransmidstream.com     smoore@equitransmidstream.com

 

with copies (which shall not constitute notice) to:

 

  Latham & Watkins LLP   811 Main Street, Suite 3700   Houston, TX 77002  
Attention: Ryan J. Maierson     Nick S. Dhesi   Email: ryan.maierson@lw.com    
nick.dhesi@lw.com

 

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or to such other address as the Company, the Partnership or the Investors may
designate to each other in writing from time to time. All notices and
communications shall be deemed to have been duly given: (a) at the time
delivered by hand, if personally delivered, (b) upon actual receipt if sent by
certified or registered mail, return receipt requested, or regular mail, if
mailed, (c) upon actual receipt of the email, if sent via email and (d) upon
actual receipt when delivered to an air courier guaranteeing overnight delivery.
The Company and the Partnership shall promptly notify all Investors in writing
upon (A) the granting of any consent or waiver, or the execution and delivery of
any amendment, modification or termination of any provision of this Agreement or
the Merger Agreement or (B) the termination of this Agreement by any Investor
with respect to such Investor pursuant to Section 7.5.

 

7.4          Specific Waiver.  Except as otherwise provided herein, no
amendment, waiver, consent, modification or termination of any provision of this
Agreement shall be effective unless signed by the Company, the Partnership and
each of the Lead Investors (for the avoidance of doubt, such amendment, waiver,
consent, modification or termination shall require the consent of only one
member of each Lead Investor’s Affiliate Group); provided, that no amendment or
other modification which adversely affects the rights under this Agreement of
any Investor in a disproportionate manner relative to any other Investor shall
be effective unless consented to in writing by such affected Investor; provided,
further, that no amendment or modification which modifies the type or amount of
consideration to be received by an Investor hereunder shall be effective unless
consented to in writing by such Investor. Any amendment, supplement or
modification of or to any provision of this Agreement, any waiver of any
provision of this Agreement, and any consent to any departure by the Company,
the Partnership or an Investor from the terms of any provision of this Agreement
shall be effective only in the specific instance and for the specific purpose
for which such amendment, supplement, modification, waiver or consent has been
made or given. No failure or delay on the part of any Party in exercising any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. The remedies provided herein are cumulative and are not exclusive of any
remedies that may be available to a Party at Law or in equity or otherwise.

 

7.5          Termination.  This Agreement may be terminated at any time prior to
the Closing: (a) by mutual written consent of the Company, the Partnership and
each of the Lead Investors (for the avoidance of doubt, such termination shall
require the written consent of only one member of each Lead Investor’s Affiliate
Group); (b) by either the Company and the Partnership, on one hand, or an
Investor, with respect to itself but not any other Investor, if any Governmental
Authority with lawful jurisdiction shall have issued a final order, decree or
ruling or taken any other final action restraining, enjoining or otherwise
prohibiting the transactions contemplated by the Restructuring Documents and
such order, decree, ruling or other action is or shall have become final and
nonappealable, and (c) by an Investor, with respect to itself but not any other
Investor, if the Merger is not consummated in accordance with the Merger
Agreement on or prior to August 26, 2020 (as such date may be extended by mutual
agreement of the Company, the Partnership and the Lead Investors); provided,
that any such extension to a date later than February 26, 2021 shall require the
consent of each Investor. This Agreement shall terminate automatically upon any
termination of the Merger Agreement.

 

7.6          Expenses.  The Partnership will pay the reasonable out-of-pocket
fees and expenses of the primary outside lead legal counsel and one regulatory
counsel incurred by the Investors collectively in connection with the
transactions contemplated hereby; provided, however, that the Partnership’s
obligations pursuant to this sentence shall not exceed $300,000. Each Party will
otherwise be responsible for its own out-of-pocket fees and expenses incurred in
connection with the transactions contemplated hereby.

 

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7.7          Entire Agreement; Disclaimer of Reliance.  This Agreement, the
other Restructuring Documents and the other agreements and documents referred to
herein are intended by the Parties as a final expression of their agreement and
are intended to be a complete and exclusive statement of the agreement and
understanding of the Parties hereto, in respect of the subject matter contained
herein and therein. There are no, and neither the Company nor the Partnership
nor any Investor has relied upon, restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein or in the other
Restructuring Documents with respect to the rights and obligations of the
Company, the Partnership, the Investors or any of their respective Affiliates
hereunder or thereunder, and each of the Company, the Partnership and the
Investors expressly disclaims that it is owed any duties or is entitled to any
remedies not expressly set forth in this Agreement or the Certificate of
Designations. This Agreement, the Restructuring Documents and the other
agreements and documents referred to herein or therein supersede all prior
agreements and understandings between the Parties with respect to such subject
matter.

 

7.8          Binding Effect; Assignment.  This Agreement shall be binding upon
the Company, the Partnership each of the Investors and their respective
successors and permitted assigns. Except as expressly provided in this
Agreement, this Agreement shall not be construed so as to confer any right or
benefit upon any Person other than the Parties to this Agreement and their
respective successors and permitted assigns. Without the written consent of the
Company and the Partnership, no portion of the rights and obligations of the
Investor under this Agreement may be assigned or transferred by the Investor to
a Person that is not an Affiliate of the Investor. No portion of the rights and
obligations of the Company or the Partnership under this Agreement may be
transferred or assigned (including by merger or operation of Law) without the
prior written consent of the Investors.

 

7.9          No Third Party Beneficiaries.  Nothing in this Agreement, express
or implied, is intended to or shall confer upon any Person, other than for
purposes of Section 7.10 only, any member, partner, shareholder, unitholder,
Affiliate or Representative of the Company, the Partnership or the Investors, or
any member, partner, shareholder, unitholder, Affiliate or Representative of any
of the foregoing, any right, benefit or remedy of any nature whatsoever under or
by reason of this Agreement.

 

7.10       Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.

 

(a)          This Agreement and all claims or causes of action (whether in
contract or tort) that may be based upon, arise out of or relate to this
Agreement or the negotiation, execution, termination, performance or
nonperformance of this Agreement (including any claim or cause of action based
upon, arising out of or related to any representation or warranty made in or in
connection with this Agreement or as an inducement to enter into this Agreement)
will be construed in accordance with and governed by the laws of the State of
Delaware without regard to principles of conflicts of laws that might otherwise
require the application of the Laws of any other jurisdiction. Any action
against any Party relating to the foregoing shall be brought in any federal or
state court of competent jurisdiction located within the State of Delaware (the
“Chosen Courts”), and the Parties hereto hereby irrevocably submit to the
non-exclusive jurisdiction of any federal or state court located within the
State of Delaware over any such action. The Parties hereby irrevocably waive, to
the fullest extent permitted by applicable Law, any objection which they may now
or hereafter have to the laying of venue of any such dispute brought in such
court or any defense of inconvenient forum for the maintenance of such dispute.
Each of the Parties hereto agrees that a judgment in any such dispute may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by Law.

 

(b)          EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES THE RIGHT TO A
TRIAL BY JURY IN CONNECTION WITH ANY MATTER ARISING OUT OF THIS AGREEMENT TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW.

 

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7.11       Specific Performance. Irreparable damage would occur and each Party
would not have an adequate remedy at Law in the event that the other Party fails
to consummate the Restructuring concurrently with the closing of the Merger.
Accordingly, each Party shall be entitled to seek one or more injunctions to
cause the consummation of the Restructuring or to prevent any breach of any such
obligation or covenant and to enforce specifically this Agreement in the Chosen
Courts, in addition to any other remedy to which such Party may be entitled at
Law or in equity. Each Party agrees not to dispute or resist any such
application for relief on the basis that any other Party to this Agreement has
an adequate remedy at Law or that damage arising from such non-performance or
breach is not irreparable.

 

7.12       No Recourse Against Others.

 

(a)          All claims, obligations, liabilities, or causes of action (whether
in contract or in tort, in Law or in equity, or granted by statute) that may be
based upon, in respect of, arise under, out or by reason of, be connected with,
or relate in any manner to this Agreement, or the negotiation, execution, or
performance of this Agreement (including any representation or warranty made in,
in connection with, or as inducement to, this Agreement), may be made only
against (and are expressly limited to) the Company, the Partnership and the
Investors. No Person other than the Company, the Partnership or the Investors,
including no member, partner, shareholder, unitholder, Affiliate or
Representative thereof, nor any member, partner, shareholder, unitholder,
Affiliate or Representative of any of the foregoing, shall have any liability
(whether in contract or in tort, in Law or in equity, or granted by statute) for
any claims, causes of action, obligations, or liabilities arising under, out of,
in connection with, or related in any manner to this Agreement or based on, in
respect of, or by reason of this Agreement or its negotiation, execution,
performance, or breach; and, to the maximum extent permitted by Law, each of the
Company, the Partnership and each Investor hereby waives and releases all such
liabilities, claims, causes of action, and obligations against any such third
Person.

 

(b)          Without limiting the foregoing, to the maximum extent permitted by
Law, (i) the Company, the Partnership and each Investor hereby waives and
releases any and all rights, claims, demands, or causes of action that may
otherwise be available at Law or in equity, or granted by statute, to avoid or
disregard the entity form of the other or otherwise impose liability of the
other on any third Person, whether granted by statute or based on theories of
equity, agency, control, instrumentality, alter ego, domination, sham, single
business enterprise, piercing the veil, unfairness, undercapitalization, or
otherwise; and (ii) the Company, the Partnership and each Investor disclaims any
reliance upon any third Person with respect to the performance of this Agreement
or any representation or warranty made in, in connection with, or as an
inducement to this Agreement.

 

7.13       Counterparts.  This Agreement may be executed in any number of
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original and all of which counterparts, taken together, shall
constitute but one and the same agreement.

 

7.14       Severability.  Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable Laws, but if any provision or portion of this Agreement is held to be
invalid, illegal, or unenforceable in any respect under any applicable Laws in
any jurisdiction by any applicable Governmental Authority, (a) such invalidity,
illegality, or unenforceability shall not affect the validity, legality, or
enforceability of any other provision of this Agreement in such jurisdiction or
affect the validity, legality, or enforceability of any provision in any other
jurisdiction, (b) such provision shall be invalid, illegal, or unenforceable
only to the extent strictly required by such Governmental Authority, (c) to the
extent any such provision is deemed to be invalid, illegal, or unenforceable,
each Party agrees that it shall use its commercially reasonable efforts to cause
such Governmental Authority to modify such provision so that such provision
shall be valid, legal, and enforceable as originally intended to the greatest
extent possible, and (d) to the extent that the Governmental Authority does not
modify such provision, each of the Parties agree that they shall endeavor in
good faith to exercise or modify such provision so that such provision shall be
valid, legal, and enforceable as originally intended to the greatest extent
possible.

 

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7.15       Damages.  Anything to the contrary in this Agreement notwithstanding,
in no event shall a Party be liable hereunder for (a) any remote, exemplary, or
punitive damages or (b) any special, consequential, incidental, or indirect
damages or lost profits, except in the case of clause (b), to the extent any
such damages or lost profits would otherwise be recoverable under applicable Law
in an action for breach of contract.

 

7.16       Amendment of Merger Agreement; Interim Actions.

 

(a)          Notwithstanding anything to the contrary in the Restructuring
Documents, neither Company, nor the Partnership shall, and each shall cause each
of its respective Affiliates not to, amend or modify the Merger Agreement or
amend, modify or waive any right under, or the satisfaction of any condition in,
the Merger Agreement, in each case, in any manner or respect that would
materially and adversely affect any Investor without the prior written consent
of each Lead Investor (for the avoidance of doubt, such prior written consent
shall require the consent of only one member of each Lead Investor’s Affiliate
Group). The Company and the Partnership shall provide the Investors with
reasonable updates regarding the status of the transactions contemplated by the
Merger Agreement, including with respect to (i) prompt notice of all material
developments with respect thereto and (ii) to the extent not duplicative with
preceding clause (i), true, correct and complete copies of any written notice
given by or to the Company or the Partnership or any of their Affiliates under
the Merger Agreement promptly following their receipt or delivery, as
applicable.

 

(b)          Notwithstanding anything to the contrary in the Restructuring
Documents, during the term of this Agreement until the earlier of the Closing or
the termination of this Agreement in accordance with its terms, the Company
shall not take any action described under Section 4(d) or 4(e) of the
Certificate of Designations, in each case, without the prior written consent of
the Investors who, as of the Closing (as set forth on Schedule I, as may be
amended), will hold at least 66 2/3% of the Series A Preferred Shares.

 

7.17       Effect on the Partnership Agreement. Except as expressly set forth in
this Agreement, prior to the Closing, (a) all of the terms and conditions of the
Partnership Agreement shall continue in full force and effect and remain
unchanged and (b) nothing in this Agreement shall be deemed to be an amendment,
modification or waiver of any of the rights, preferences and privileges afforded
to the Investors in the Partnership Agreement as holders of Series A Preferred
Units.

 

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7.18       Removal of Legend. In connection with a sale of the Series A
Preferred Shares or Conversion Shares by an Investor in reliance on Rule 144
promulgated under the Securities Act, the applicable Investor or its broker
shall deliver to the Company and the Company Transfer Agent a broker
representation letter providing to the Company and the Company Transfer Agent
any information the Company deems necessary to determine that such sale is made
in compliance with Rule 144, including, as may be appropriate, a certification
that the applicable Investor is not an Affiliate of the Company and regarding
the length of time the Series A Preferred Shares or Conversion Shares have been
held. Upon receipt of such representation letter, the Company shall promptly
direct the Company Transfer Agent to remove the legend referred to in Section
5.5(e) from the appropriate book-entry accounts maintained by the Company
Transfer Agent, and the Company shall bear all costs associated therewith
(including paying the reasonable customary cost of any legal opinion required by
the Company Transfer Agent to be rendered in connection with the removal of such
legend). After an Investor or its permitted assigns have held the Series A
Preferred Shares or Conversion Shares for such time as non-Affiliates are
permitted to sell without the requirement for the Company to be in compliance
with the current public information required under Rule 144(c)(1) (or Rule
144(i)(2), if applicable) as to such Series A Preferred Shares or Conversion
Shares and without volume or manner of sale restrictions under Rule 144, if the
book-entry accounts for such Series A Preferred Shares or Conversion Shares
still bear the restrictive legend referred to in Section 5.5(e), the Company
agrees, upon request of such Investor or permitted assignee, to take all steps
necessary to promptly effect the removal of the legend described in Section
5.5(e) therefrom, and the Company shall bear all costs associated therewith
(including paying the reasonable customary cost of any legal opinion required by
the Company Transfer Agent to be rendered in connection with the removal of such
legend), regardless of whether the request is made in connection with a sale or
otherwise, so long as such Investor or its permitted assigns provide to the
Company any information the Company deems necessary to determine that the legend
is no longer required under the Rules and Regulations or applicable state laws,
including a certification that the holder is not an Affiliate of the Company
(and a covenant to inform the Company if it should thereafter become an
Affiliate and to consent to the placing of an appropriate restrictive legend on
the applicable Series A Preferred Shares in such case) and regarding the length
of time the Series A Preferred Shares or Conversion Shares have been held. The
Company shall cooperate with the Investors to effect the removal of the legend
referred to in Section 5.5(e) at any time such legend is no longer appropriate.

 

7.19       Tax Information. Reasonably promptly following the Closing, the
Company shall deliver to each Investor a reasonable projection of the portion of
the Cash Dividends (as defined in the Certificate of Designations) for the
current taxable year and the succeeding two taxable years that will be treated
as a dividend for U.S. federal income tax purposes. The Company shall use
commercially reasonable efforts to deliver, prior to December 15 of each taxable
year, to each Investor that owns Series A Preferred Shares as of such date a
reasonable projection of the portion of the Cash Dividends (as defined in the
Certificate of Designations) for the immediately succeeding taxable year that
will be treated as a dividend for U.S. federal income tax purposes.

 

7.20       Transfer Taxes. The Company shall be responsible for any transfer
Taxes or other similar Taxes required to be paid and shall comply with
associated Tax reporting requirements, in each case, in connection with the
Restructuring.

 

7.21       No Relationship Among Investors. Notwithstanding anything to the
contrary herein, the duties and obligations of the Investors under this
Agreement shall be several, not joint. None of the Investors shall have any
fiduciary duty, any duty of trust or confidence in any form, or other duties or
responsibilities to each other or any other Party. No prior history, pattern or
practice of sharing confidence among or between any of the Investors and/or the
Company or the Partnership shall in any way affect or negate this understanding
and agreement. The Investors have no agreement, arrangement or understanding
with respect to acting together for the purpose of acquiring, holding, voting or
disposing of any securities of any of the Company or the Partnership and do not
constitute a “group” within the meaning of Section 13(d)(3) of the Exchange Act
or Rule 13d-5 promulgated thereunder. For the avoidance of doubt: (1) each
Investor is entering into this Agreement directly with the Company and the
Partnership and not with any other Investor, (2) no other Investor shall have
any right to bring any action against any other Investor with respect to this
Agreement (or any breach thereof) and (3) no Investor shall, nor shall any
action taken by an Investor pursuant to this Agreement, be deemed to be acting
in concert or as any group with any other Investor with respect to the
obligations under this Agreement nor shall this Agreement create a presumption
that the Investors are in any way acting as a group. All rights under this
Agreement are separately granted to each Investor by the Company and the
Partnership, as applicable, and vice versa. The decision to commit to enter into
the transactions contemplated by this Agreement has been made independently by
each Investor.

 

[Signature page follows.]

 

26

 

 

 

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as
of the date first written above.

 

  EQUITRANS MIDSTREAM CORPORATION       By: /s/ Kirk R. Oliver   Name: Kirk R.
Oliver   Title: Senior Vice President and Chief Financial Officer

 

  EQM MIDSTREAM PARTNERS, LP       By: EQGP Services, LLC, its general partner  
    By: /s/ Kirk R. Oliver   Name: Kirk R. Oliver   Title: Senior Vice President
and Chief Financial Officer

 

Signature Page to Preferred Restructuring Agreement

 

 

 

 

INVESTORS:

 

  INVESTMENT PARTNERS V (II), LLC       By: BAA Co-Investment Fund (GenPar),
LLC, its sole member       By: BlackRock Financial Management, Inc., its sole
member       By: /s/ Bryan J. Smith   Name: Bryan J. Smith   Title: Managing
Director

 

 

  GEPIF III EQM HOLDINGS, L.P.       By: GEPIF III EQM Holdings GP, LLC, its
general partner           By: /s/ Mark Saxe   Name: Mark Saxe   Title: President

 

 

  GSO EQUITABLE FINANCE LP       By: GSO Equitable Finance Holdings LLC, its
general partner           By: /s/ Marisa J. Beeney   Name: Marisa J. Beeney  
Title: Authorized Signatory

 

Signature Page to Preferred Restructuring Agreement

 

 

 

 

  MTP ENERGY OPPORTUNITIES FUND II LLC       By: MTP Energy Management LLC, its
managing member       By: Magnetar Financial LLC, its sole member       By: /s/
Michael Turro   Name: Michael Turro   Title: Chief Compliance Officer

 

 

  MTP EOF II IP LLC       By: MTP Energy Management LLC, its managing member    
  By: Magnetar Financial LLC, its sole member       By: /s/ Michael Turro  
Name: Michael Turro   Title: Chief Compliance Officer               MTP ENERGY
MASTER FUND LLC       By: MTP Energy Management LLC, its manager       By:
Magnetar Financial LLC, its sole member       By: /s/ Michael Turro   Name:
Michael Turro   Title: Chief Compliance Officer

 

Signature Page to Preferred Restructuring Agreement

 

 

 

 

  MAGNETAR STRUCTURED CREDIT FUND, LP       By: Magnetar Financial LLC, its
general partner       By: /s/ Michael Turro   Name: Michael Turro   Title: Chief
Compliance Officer

 

 

  MAGNETAR CONSTELLATION FUND V LLC       By: Magnetar Financial LLC, its
manager       By: /s/ Michael Turro   Name: Michael Turro   Title: Chief
Compliance Officer

 

 

  MAGNETAR LONGHORN FUND LP       By: Magnetar Financial LLC, its investment
manager       By: /s/ Michael Turro   Name: Michael Turro   Title: Chief
Compliance Officer

 

 

  SERIES V, A SERIES OF ASTRUM PARTNERS LLC       By: Magnetar Financial LLC,
its manager       By: /s/ Michael Turro   Name: Michael Turro   Title: Chief
Compliance Officer

 

Signature Page to Preferred Restructuring Agreement

 

 

 

 

  BSOF QMODEM (M) 2 L.P.       By: Magnetar Financial LLC, its advisor       By:
/s/ Michael Turro   Name: Michael Turro   Title: Chief Compliance Officer

 

 

  MTP EMERALD FUND LLC       By: MTP Energy Management LLC, its manager        
By: Magnetar Financial LLC, its sole member       By: /s/ Michael Turro   Name:
Michael Turro   Title: Chief Compliance Officer               CEQM HOLDINGS, LLC
      By: /s/ Todd Triller   Name: Todd Triller   Title: Managing Director

 

 

  NB BURLINGTON AGGREGATOR LP       By: /s/ David Lyon   Name: David Lyon  
Title: Authorized Signatory

 

 

  KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY         By: KA Fund Advisors,
LLC, its manager       By: /s/ James C. Baker   Name: James C. Baker   Title:
Managing Director  

 

Signature Page to Preferred Restructuring Agreement

 

 

 

 

  KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.         By: KA Fund Advisors, LLC,
its manager       By: /s/ James C. Baker   Name: James C. Baker   Title:
Managing Director               TORTOISE DIRECT OPPORTUNITIES FUND II, LP      
  By: Tortoise Direct Opportunities GP II LLC, its general partner       By: /s/
Michelle Johnston   Name: Michelle Johnston   Title: Director                  
PORTCULLIS PARTNERS, LP       By: /s/ Duane Kelley   Name: Duane Kelley   Title:
Vice President               CENTAURUS CAPITAL LP       By: Centaurus Holdings,
LLC, its general partner       By: /s/ John D. Arnold   Name: John D. Arnold  
Title: Manager

 

Signature Page to Preferred Restructuring Agreement

 

 

 

 

 Schedule I

 

Investors

 

Investor: Series A
Preferred
Units: Redeemed
Series A
Preferred
Units: Series A
Preferred
Units Not
Redeemed: Series A
Preferred
Shares:

GSO Equitable Finance LP

 

c/o GSO Capital Partners LP
345 Park Avenue, 31st Floor
New York, NY 10154
Attention: Robert Horn
Email: robert.horn@gsocap.com;
GSOLegal@gsocap.com

 

6,151,323 3,230,999 2,920,324 7,125,591

MTP Energy Opportunities Fund II LLC

 

 

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

2,398,690 1,259,918 1,138,772 2,778,604

MTP EOF II IP LLC

 

 

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

320,638 168,416 152,222 371,422

MTP Energy Master Fund LLC

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

1,469,561 771,892 697,669 1,702,312

Magnetar Structured Credit Fund, LP

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

204,019 107,162 96,857 236,331

 

Schedule I
Preferred Restructuring Agreement

 

 

 

 

Magnetar Constellation Fund V LLC

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

277,835 145,934 131,901 321,838

Magnetar Longhorn Fund LP

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

338,323 177,705 160,618 391,908

SERIES V, A SERIES OF ASTRUM PARTNERS LLC

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

123,026 64,620 58,406 142,511

BSOF Qmodem (M) 2 L.P.

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

697,150 366,180 330,970 807,567

MTP Emerald Fund LLC

 

Magnetar Financial LLC
1603 Orrington Ave., 13th Floor
Evanston, IL 60201
Email: MTP_Notices@magnetar.com
Phone: 847-905-4400

 

65,776 34,549 31,227 76,194

 

Schedule I
Preferred Restructuring Agreement

 

 

 

 

Investment Partners V (II), LLC

 

c/o BlackRock Financial Management, Inc.
40 East 52nd Street
New York, NY 10022
Attention: Stephen Kavulich      
Email:  GroupBAACorePM@blackrock.com

With copy to:

c/o BlackRock, Inc.
Office of the General Counsel
40 East 52nd Street
New York, NY 10022
Attention: David Maryles and Jelena Napolitano
Email: legaltransactions@blackrock.com

 

512,610 269,249 243,361 593,801

GEPIF III EQM Holdings, L.P.

 

c/o BlackRock Financial Management, Inc.
609 Main Street
Houston, TX 77002
Attention: Mark Saxe    
Email:  mark.saxe@blackrock.com

With copy to: 

c/o BlackRock, Inc.
Office of the General Counsel
40 East 52nd Street
New York, NY 10022
Attention: David Maryles and Jelena Napolitano
Email: legaltransactions@blackrock.com

 

6,151,323 3,230,999 2,920,324 7,125,591

CEQM Holdings, LLC

 

 

 

520 Madison Avenue, 38th Floor
New York, NY 10022
Attention: Arleen Spangler; Emily Chang
Email: Arleen.Spangler@carlyle.com;
Emily.Chang@carlyle.com

 

2,050,441 1,025,221 1,025,220 2,501,537

 

Schedule I
Preferred Restructuring Agreement

 

 

 

 

NB Burlington Aggregator LP

 

 

 

c/o David Lyon
Neuberger Berman
1290 Avenue of the Americas, 43rd Floor
New York, NY 10104
David.lyon@nb.com

With copies to:

Dean Winick
Neuberger Berman
1290 Avenue of the Americas, 24th Floor
New York, NY 10104
Dean.winick@nb.com

 

2,050,441 512,610 1,537,831 3,752,308

Kayne Anderson MLP/Midstream Investment Company

 

 

 

c/o KA Fund Advisors, LLC
Attention: James C. Baker
811 Main Street, 14th Floor
Houston, TX 77002
Email: jbaker@kaynecapital.com

 

1,025,220 538,500 486,720 1,187,597

Kayne Anderson Midstream/Energy Fund, Inc.

 

 

 

c/o KA Fund Advisors, LLC
Attention: James C. Baker
811 Main Street, 14th Floor
Houston, TX 77002
Email: jbaker@kaynecapital.com

 

205,044 107,700 97,344 237,519

Centaurus Capital LP

 

 

 

1717 West Loop South, Suite 1800
Houston, TX 77027
Email: cameron@centcap.net;
allen@centcap.net

 

307,566 161,549 146,017 356,281

Tortoise Direct Opportunities Fund II, LP

 

 

 

c/o Tortoise Capital Advisors
5100 W. 115th Place
Leawood, KS 66211
Email: spang@tortoiseadvisors.com

 

205,044 102,522 102,522 250,154

Portcullis Partners, LP

 

 

 

11 Greenway Plaza, Suite 2000
Houston, TX 77046
Email: duanekelley@wvmorgan.com
Phone: 713-877-8033

 

51,261 26,925 24,336 59,380 Total 24,605,291 12,302,650 12,302,641 30,018,446

 

Schedule I
Preferred Restructuring Agreement

 

 

 

 

 

Exhibit A

 

Form of Registration Rights Agreement

 

[See attached.]

 

Exhibit A

Preferred Restructuring Agreement 

 

 

 

 

EQUITRANS MIDSTREAM CORPORATION

 

and

 

THE PURCHASERS NAMED ON SCHEDULE A

HERETO

 

 

FORM OF

 

REGISTRATION RIGHTS AGREEMENT

 

Dated [ · ], 2020

 

 

 

 

 

TABLE OF CONTENTS

 

Article I. DEFINITIONS 1     Section 1.01   Definitions 1 Section
1.02   Registrable Securities 5     Article II. REGISTRATION RIGHTS 5    
Section 2.01   Shelf Registration. 5 Section 2.02   Piggyback Registration 7
Section 2.03   Underwritten Offering 9 Section 2.04   Further Obligations 11
Section 2.05   Cooperation by Holders 15 Section 2.06   Restrictions on Public
Sale by Holders of Registrable Securities 15 Section 2.07   Expenses 15 Section
2.08   Indemnification 16 Section 2.09   Rule 144 Reporting 18 Section
2.10   Transfer or Assignment of Registration Rights 18 Section
2.11   Limitation on Subsequent Registration Rights 19 Section 2.12   Limitation
on Obligations for Series A Preferred Share Registrable Securities 19 Section
2.13   Obligation to Obtain Rating for Series A Preferred Shares 19     Article
III. MISCELLANEOUS 20     Section 3.01   Communications 20 Section
3.02   Binding Effect 20 Section 3.03   Assignment of Rights 21 Section
3.04   Recapitalization, Exchanges, Etc. Affecting Shares 21 Section
3.05   Aggregation of Registrable Securities 21 Section 3.06   Specific
Performance 21 Section 3.07   Counterparts 21 Section 3.08   Governing Law,
Submission to Jurisdiction 21 Section 3.09   Waiver of Jury Trial 22 Section
3.10   Entire Agreement 22 Section 3.11   Amendment 22 Section 3.12   No
Presumption 22 Section 3.13   Obligations Limited to Parties to Agreement 23
Section 3.14   Interpretation 23     SCHEDULE A- Purchaser Name; Notice and
Contact Information A-1     SCHEDULE B - Purchasers Deemed to have Delivered the
Piggyback Opt-out Notice B-1    

 

i 

 

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT, dated as of [ · ], 2020 (this “Agreement”),
is entered into by and among Equitrans Midstream Corporation, a Pennsylvania
corporation (the “Company”), and each of the Persons set forth on Schedule A
hereto (the “Purchasers”).

 

WHEREAS, in connection with the closing of that certain Preferred Restructuring
Agreement, dated as of February 26, 2020, by and among the Company, EQM
Midstream Partners, LP, a Delaware limited partnership (the “Partnership”), and
the Purchasers (the “Restructuring Agreement”), $600.0 million of the
Partnership’s Series A Perpetual Convertible Preferred Units (each, a “Series A
Preferred Unit”) issued and outstanding immediately prior to the closing of the
transactions contemplated by the Restructuring Agreement were redeemed by the
Partnership at a price equal to $[ · ]1 per Series A Preferred Unit and the
remaining portion of the Series A Preferred Units issued and outstanding
immediately prior to the closing of the transactions contemplated by the
Restructuring Agreement were exchanged for newly issued Series A Preferred
Shares (as defined below) of the Company; and

 

WHEREAS, pursuant to the terms of the Restructuring Agreement, the Company and
each of the Purchasers agreed to execute and deliver an agreement governing
registration and other rights among the parties thereto as set forth in this
Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereby agree as follows:

 

Article I.

 

DEFINITIONS

 

Section 1.01       Definitions. As used in this Agreement, the following terms
have the meanings indicated:

 

“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. As used herein, the term
“control” means the possession, direct or indirect, 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. Notwithstanding
anything to the contrary provided herein, for purposes of this Agreement, no
Series A Preferred Shareholder shall be considered an Affiliate of the Company
or its subsidiaries, and no Series A Preferred Shareholder or any of its
Affiliates shall be considered Affiliates of any other Series A Preferred
Shareholder or any of such other Series A Preferred Shareholder’s Affiliates, in
either case, solely by virtue of such Series A Preferred Shareholder’s ownership
of the Series A Preferred Shares. Notwithstanding anything in this definition to
the contrary, for purposes of this Agreement, (a) the Company and its
subsidiaries, on the one hand, and any Series A Preferred Shareholder, on the
other hand, shall not be considered Affiliates and (b) any fund or account
managed, advised or subadvised, directly or indirectly, by a Series A Preferred
Shareholder or its Affiliates, shall be considered an Affiliate of such Series A
Preferred Shareholder.

 

 

1 To be calculated in accordance with the Preferred Restructuring Agreement.

 

1

 

 

“Agreement” has the meaning set forth in the introductory paragraph of this
Agreement.

 

“Articles of Incorporation” means the Amended and Restated Articles of
Incorporation of the Company, dated as of November 12, 2018.

 

“BlackRock” means, collectively, the Purchasers listed on Annex A hereto under
the heading “BlackRock”, and their permitted assignees.

 

“Business Day” means any day other than a Saturday, Sunday, any federal legal
holiday or day on which banking institutions in the State of New York or
Commonwealth of Pennsylvania are authorized or required by law or other
governmental action to close.

 

“Certificate of Designations” means the Certificate of Designations of the
Company relating to Series A Preferred Shares, dated [ · ], 2020, as it may be
amended from time to time in accordance therewith.

 

“Change of Control” has the meaning set forth in the Certificate of
Designations.

 

“Commission” means the United States Securities and Exchange Commission.

 

“Common Share Registrable Securities” means (a) the shares of Common Stock
issuable upon conversion of the Purchased Shares and (b) any other securities
issued or issuable with respect to or in exchange for the shares of Common Stock
issuable upon conversion of the Purchased Shares, whether in connection with a
Change of Control or Company Restructuring Event or by merger, consolidation,
reorganization, charter amendment, sale of all or substantially all assets or
otherwise, all of which are subject to the rights provided herein until such
time as such securities cease to be Registrable Securities pursuant to Section
1.02.

 

“Common Stock” means the shares of common stock, no par value, of the Company,
with the rights and obligations specified in the Articles of Incorporation, or
any other security issued or issuable with respect to or in exchange for Common
Stock, whether in connection with a Change of Control or Company Restructuring
Event or by merger, consolidation, reorganization, charter amendment, sale of
all or substantially all assets or otherwise.

 

“Company” has the meaning set forth in the introductory paragraph of this
Agreement.

 

“Company Restructuring Event” has the meaning set forth in the Certificate of
Designations.

 

“Effective Date” means the date of effectiveness of any Registration Statement.

 

“Effectiveness Period” has the meaning specified in Section 2.01(a).

 

“EQT RRA” means that certain shareholder and registration rights agreement,
dated as of November 12, 2018, by and between EQT Corporation and the Company.

 

2

 

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and the rules and regulations of the Commission promulgated thereunder.

 

“GSO” means, collectively, the Purchasers listed on Annex A hereto under the
heading “GSO”, and their permitted assignees.

 

“Holder” means the record holder of any Registrable Securities.

 

“Holder Underwriter Registration Statement” has the meaning specified in Section
2.04(q).

 

“Included Registrable Securities” has the meaning specified in Section 2.02(a).

 

“Initiating Holder” has the meaning specified in Section 2.03(d).

 

“Lead Investors” means collectively, BlackRock, GSO, Magnetar and, solely for
purposes of Section 2.02(b), Investment Partners V (II), LLC.

 

“Liquidated Damages” has the meaning specified in Section 2.01(b).

 

“Liquidated Damages Multiplier” means the product of (a) the Purchased Share
Price and (b) the number of Registrable Securities then held by the applicable
Holder and to be included on the applicable Registration Statement.

 

“Losses” has the meaning specified in Section 2.08(a).

 

“Magnetar” means, collectively, the Purchasers listed on Annex A hereto under
the heading “Magnetar”, and their permitted assignees.

 

“Managing Underwriter” means, with respect to any Underwritten Offering, the
book running lead manager of such Underwritten Offering.

 

“National Securities Exchange” means either the New York Stock Exchange, the
Nasdaq Stock Market, an exchange registered with the Commission under Section
6(a) of the Exchange Act (or any successor to such Section) or any other
securities exchange (whether or not registered with the Commission under Section
6(a) (or successor to such Section) of the Exchange Act) on which shares of
Common Stock are then listed.

 

“Other Holder” has the meaning specified in Section 2.02(a).

 

“Partnership” has the meaning set forth in the Recitals of this Agreement.

 

“Person” means any individual, corporation, company, voluntary association,
partnership, joint venture, trust, limited liability company, unincorporated
organization, government or any agency, instrumentality or political subdivision
thereof or any other form of entity.

 

“Piggyback Notice” has the meaning specified in Section 2.02(a).

 

“Piggyback Opt-Out Notice” has the meaning specified in Section 2.02(a).

 

3

 

 

“Piggyback Registration” has the meaning specified in Section 2.02(a).

 

“Purchased Share Price” means $19.99 per share.

 

“Purchased Shares” means the Series A Preferred Shares to be issued and
delivered to the Purchasers pursuant to the Restructuring Agreement.

 

“Purchasers” has the meaning set forth in the introductory paragraph of this
Agreement.

 

“Registrable Securities” means the Common Share Registrable Securities and the
Series A Preferred Share Registrable Securities.

 

“Registration” means any registration pursuant to this Agreement, including
pursuant to a Registration Statement or a Piggyback Registration.

 

“Registrable Securities Required Voting Percentage” means a majority of the
outstanding Registrable Securities voting together as a single class, including
the Series A Preferred Share Registrable Securities on an as-converted basis to
Common Share Registrable Securities.

 

“Registration Expenses” has the meaning specified in Section 2.07(a).

 

“Registration Statement” has the meaning specified in Section 2.01(a).

 

“Restructuring Agreement” has the meaning set forth in the Recitals of this
Agreement.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations of the Commission promulgated thereunder.

 

“Selling Expenses” has the meaning specified in Section 2.07(a).

 

“Selling Holder” means a Holder who is selling Registrable Securities pursuant
to a Registration Statement.

 

“Selling Holder Indemnified Persons” has the meaning specified in Section
2.08(a).

 

“Series A Preferred Share Registrable Securities” means the (a) Purchased Shares
and (b) any other securities issued or issuable with respect to or in exchange
for the Purchased Shares, whether in connection with a Change of Control or
Company Restructuring Event or by merger, consolidation, reorganization, charter
amendment, sale of all or substantially all assets or otherwise, all of which
are subject to the rights of Series A Preferred Share Registrable Securities
provided herein until such time as such securities either (i) convert into
shares of Common Stock pursuant to the terms of the Certificate of Designations
or (ii) cease to be Registrable Securities pursuant to Section 1.02.

 

“Series A Preferred Shares” means the Company’s Series A Perpetual Convertible
Preferred Shares, no par value, with the rights and obligations specified in the
Certificate of Designations.

 

4

 

 

“Series A Preferred Shareholder” means a record holder of Series A Preferred
Shares.

 

“Series A Preferred Unit” has the meaning set forth in the recitals.

 

“Target Effective Date” has the meaning specified in Section 2.01(a).

 

“Underwriter” means, with respect to any Underwritten Offering, the underwriters
of such Underwritten Offering.

 

“Underwritten Offering” means an offering (including an offering pursuant to a
Registration Statement) in which Series A Preferred Shares or shares of Common
Stock are sold to an underwriter on a firm commitment basis for reoffering to
the public or an offering that is a “bought deal” with one or more investment
banks.

 

“WKSI” means a well-known seasoned issuer (as defined in the rules and
regulations of the Commission).

 

Section 1.02       Registrable Securities. Any Registrable Security will cease
to be a Registrable Security upon the earliest to occur of the following: (a)
when a registration statement covering such Registrable Security becomes or has
been declared effective by the Commission and such Registrable Security has been
sold or disposed of pursuant to such effective registration statement, (b) when
such Registrable Security has been disposed of (excluding transfers or
assignments by a Holder to an Affiliate or to another Holder or any of its
Affiliates or to any assignee or transferee to whom the rights under this
Agreement have been transferred pursuant to Section 2.10) pursuant to any
section of Rule 144 (or any similar provision then in effect) under the
Securities Act, (c) when such Registrable Security is held by the Company or any
of its direct or indirect subsidiaries and (d) when such Registrable Security
has been sold or disposed of in a private transaction in which the transferor’s
rights under this Agreement are not assigned to the transferee of such
securities pursuant to Section 2.10. In addition, a Holder will cease to have
rights to require registration of any Registrable Securities held by that Holder
under this Agreement on the second anniversary of the date on which all Series A
Preferred Shares have been converted into shares of Common Stock.

 

Article II.

 

REGISTRATION RIGHTS

 

Section 2.01       Shelf Registration.

 

(a)         Shelf Registration. The Company shall use its commercially
reasonable efforts to (i) prepare and file an initial registration statement
under the Securities Act to permit the resale of Registrable Securities from
time to time as permitted by Rule 415 (or any similar provision adopted by the
Commission then in effect) of the Securities Act (a “Registration Statement”)
and (ii) cause such initial Registration Statement to become effective no later
than twenty (20) Business Days following the date hereof (the “Target Effective
Date”). The Company will use its commercially reasonable efforts to cause such
initial Registration Statement filed pursuant to this Section 2.01(a) to be
continuously effective under the Securities Act, with respect to any Holder,
until the earliest to occur of the following: (A) the date on which there are no
longer any Registrable Securities outstanding and (B) the second anniversary of
the date on which all Series A Preferred Shares have been converted into shares
of Common Stock (in each case of clause (A) or (B) the “Effectiveness Period”).
A Registration Statement filed pursuant to this Section 2.01(a) shall be on such
appropriate registration form of the Commission as shall be selected by the
Company; provided that, if the Company is then eligible, it shall file such
Registration Statement on Form S-3 and, if eligible, pursuant to an “automatic
shelf registration statement” as defined under Rule 405 of the Securities Act. A
Registration Statement when declared effective (including the documents
incorporated therein by reference) will comply as to form in all material
respects with all applicable requirements of the Securities Act and the Exchange
Act and will not contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading (and, in the case of any prospectus contained
in such Registration Statement, in the light of the circumstances under which a
statement is made). As soon as practicable following the date that a
Registration Statement becomes effective, but in any event within three (3)
Business Days of such date, the Company shall provide the Holders with written
notice of the effectiveness of such Registration Statement. The Company shall
not be obligated to have more than one effective Registration Statement at any
given time pursuant to this Section 2.01.

 

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(b)        Failure to Become Effective. If a Registration Statement required by
Section 2.01(a) does not become or is not declared effective by the Target
Effective Date, then each Holder shall be entitled to a payment (with respect to
each of the Holder’s Registrable Securities which are included in such
Registration Statement), as liquidated damages and not as a penalty, of (i) for
each non-overlapping 30-day period for the first 60 days following the Target
Effective Date, an amount equal to 0.25% of the Liquidated Damages Multiplier,
and (ii) for each non-overlapping 30-day period beginning on the 61st day
following the Target Effective Date, an amount equal to the amount set forth in
clause (i) plus an additional 0.25% of the Liquidated Damages Multiplier for
each subsequent 60 days (i.e., 0.5% for 61-120 days, 0.75% for 121-180 days, and
1.0% thereafter), up to a maximum amount equal to 1.0% of the Liquidated Damages
Multiplier per non-overlapping 30-day period (the “Liquidated Damages”), until
such time as such Registration Statement is declared or becomes effective or
there are no longer any Registrable Securities outstanding. The Liquidated
Damages shall be payable within ten (10) Business Days after the end of each
such 30-day period in immediately available funds to the account or accounts
specified by the applicable Holders. Any amount of Liquidated Damages shall be
prorated for any period of less than thirty (30) days accruing during any period
for which a Holder is entitled to Liquidated Damages hereunder.

 

(c)         Waiver of Liquidated Damages. If the Company is unable to cause a
Registration Statement to become effective on or before the Target Effective
Date, then the Company may request a waiver of the Liquidated Damages, which may
be granted by the consent of the Holders of at least the Registrable Securities
Required Voting Percentage, in their sole discretion, and which such waiver
shall apply to all the Holders of Registrable Securities included on such
Registration Statement.

 

(d)         Delay Rights. Notwithstanding anything to the contrary contained
herein, the Company may, upon written notice to any Selling Holder whose
Registrable Securities are included in a Registration Statement, suspend such
Selling Holder’s use of any prospectus which is a part of such Registration
Statement (in which event the Selling Holder shall suspend sales of the
Registrable Securities pursuant to such Registration Statement) if (i) the
Company is pursuing an acquisition, merger, reorganization, disposition or other
similar transaction and the Company determines in good faith that the Company’s
ability to pursue or consummate such a transaction would be materially and
adversely affected by any required disclosure of such transaction in such
Registration Statement or (ii) the Company or any of its Affiliates has
experienced some other material non-public event, the disclosure of which at
such time, in the good faith judgment of the Company, would materially and
adversely affect the Company; provided, however, that in no event shall the
Selling Holders be suspended from selling Registrable Securities pursuant to
such Registration Statement for a period that exceeds an aggregate of 60 days in
any 180-day period or 105 days in any 365-day period. Upon disclosure of such
information or the termination of the condition described above, the Company
shall provide prompt notice to the Selling Holders whose Registrable Securities
are included in such Registration Statement, and shall promptly terminate any
suspension of sales it has put into effect and shall take such other actions
necessary or appropriate to permit registered sales of Registrable Securities as
contemplated in this Agreement. For the avoidance of doubt, the provisions of
this Section 2.01(d) shall apply to any Underwritten Offering undertaken
pursuant to Section 2.03.

 

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Section 2.02       Piggyback Registration.

 

(a)         Participation. If at any time the Company proposes to file (i) a
Registration Statement (other than a Registration Statement contemplated by
Section 2.01(a)) on behalf of any other Person who has or has been granted
registration rights related to an Underwritten Offering (the “Other Holder”), or
(ii) a prospectus supplement relating to the sale of shares of Common Stock by
any Other Holders to an effective registration statement, so long as the Company
is a WKSI at such time or, whether or not the Company is a WKSI, so long as the
Common Share Registrable Securities were previously included in the underlying
shelf Registration Statement or are included on an effective Registration
Statement, or in any case in which Holders may participate in such offering
without the filing of a post-effective amendment, in each case, for the sale of
shares of Common Stock by Other Holders in an Underwritten Offering, then the
Company shall give not less than four (4) Business Days’ notice (including, but
not limited to, notification by electronic mail) (the “Piggyback Notice”) of
such proposed Underwritten Offering to each Holder that, together with its
Affiliates, owns at least $15 million of Common Share Registrable Securities and
such Piggyback Notice shall offer such Holder the opportunity to include in such
Underwritten Offering for Other Holders such number of Common Share Registrable
Securities (the “Included Registrable Securities”) as such Holder may request in
writing (a “Piggyback Registration”); provided, however, that the Company shall
not be required to offer such opportunity (A) to such Holders if the Holders,
together with their Affiliates, do not offer a minimum of $15 million of Common
Share Registrable Securities, in the aggregate (determined by multiplying the
number of Common Share Registrable Securities owned by the average of the
closing price on the National Securities Exchange for the shares of Common Stock
for the ten (10) trading days preceding the date of such notice), or such lesser
amount if it constitutes the remaining holdings of the Holder and its
Affiliates, or (B) to such Holders if and to the extent that the Company has
been advised by the Managing Underwriter that the inclusion of Common Share
Registrable Securities for sale for the benefit of such Holders will have an
adverse effect on the price, timing or distribution of the shares of Common
Stock in such Underwritten Offering, then the amount of Common Share Registrable
Securities to be offered for the accounts of Holders shall be determined based
on the provisions of Section 2.02(b). Each Piggyback Notice shall be provided to
Holders on a Business Day pursuant to Section 3.01 and receipt of such notice
shall be confirmed and kept confidential by the Holders until either (x) such
proposed Underwritten Offering has been publicly announced by the Company or (y)
the Holders have received notice from the Company that such proposed
Underwritten Offering has been abandoned, which the Company shall provide to the
Holders reasonably promptly after the final decision to abandon a proposed
Underwritten Offering has been made. Each such Holder will have four (4)
Business Days (or two (2) Business Days in connection with any overnight or
bought Underwritten Offering) after such Piggyback Notice has been delivered to
request in writing to the Company the inclusion of Common Share Registrable
Securities in the Underwritten Offering for Other Holders. If no request for
inclusion from a Holder is received by the Company within the specified time or
if a Holder states in its response to the Piggyback Notice that it declines the
opportunity to include Registrable Securities in the Underwritten Offering, such
Holder shall have no further right to participate in such Underwritten Offering.
If, at any time after giving written notice of the Company’s intention to
undertake an Underwritten Offering for Other Holders and prior to the pricing of
such Underwritten Offering, such Underwritten Offering is terminated or delayed
pursuant to the provisions of this Agreement, the Company may, at its election,
give written notice of such determination to the Selling Holders and, (1) in the
case of a termination of such Underwritten Offering, shall be relieved of its
obligation to sell any Included Registrable Securities in connection with such
terminated Underwritten Offering, and (2) in the case of a determination to
delay such Underwritten Offering, shall be permitted to delay offering any
Included Registrable Securities for the same period as the delay in the
Underwritten Offering. Any Selling Holder shall have the right to withdraw such
Selling Holder’s request for inclusion of such Selling Holder’s Common Share
Registrable Securities in such Underwritten Offering by giving written notice to
the Company of such withdrawal at least one (1) Business Day prior to the time
of pricing of such Underwritten Offering. Any Holder may deliver written notice
(a “Piggyback Opt-Out Notice”) to the Company requesting that such Holder not
receive notice from the Company of any proposed Underwritten Offering for Other
Holders; provided, however, that such Holder may later revoke any such Piggyback
Opt-Out Notice in writing. Following receipt of a Piggyback Opt-Out Notice from
a Holder (unless subsequently revoked), the Company shall not be required to
deliver any notice to such Holder pursuant to this Section 2.02(a) and such
Holder shall no longer be entitled to participate in Underwritten Offerings for
Other Holders pursuant to this Section 2.02(a), unless such Piggyback Opt-Out
Notice is revoked by such Holder. The Holders listed on Schedule B shall each be
deemed to have delivered a Piggyback Opt-Out Notice as of the date hereof.

 

7

 

 

(b)        Priority of Piggyback Registration. If the Managing Underwriter or
Underwriters of any proposed Underwritten Offering for Other Holders advise the
Company that the total amount of Common Share Registrable Securities that
Holders intend to include in such offering exceeds the number that can be sold
in such offering without being likely to have an adverse effect on the price,
timing or distribution of the Common Share Registrable Securities offered or the
market for the shares of Common Stock, then the Company shall include the number
of shares of Common Stock that such Managing Underwriter or Underwriters advise
the Company can be sold without having such adverse effect, with such number to
be allocated (i) in the event that the Person that initiated such Underwritten
Offering is the Company or any of the Company’s subsidiaries, (A) first, to the
Company or the Company’s subsidiaries, (B) second, pro rata among the members of
the Parent Group (as defined in the EQT RRA) exercising registration rights
pursuant to Section 2.02 of the EQT RRA related to such offering, (C) third, pro
rata among any Holders who are Lead Investors and exercising piggyback
registration rights pursuant to this Section 2.02 related to such offering, (D)
fourth, pro rata among (1) all other Holders who are exercising piggyback
registration rights pursuant to this Section 2.02 related to such offering and
(2) any Persons owning shares of Common Stock, having piggyback registration
rights pari passu to those of the Holders described in this Section
2.02(b)(i)(C) and exercising such piggyback registration rights and (E) fifth,
pro rata among any Persons owning shares of Common Stock having piggyback
registration rights subordinate to those of the Holders and exercising such
piggyback registration rights and (ii) in the event that any Person other than
the Company or any of the Company’s subsidiaries initiated such Underwritten
Offering, (A) first, the Person that initiated such Underwritten Offering, (B)
second, pro rata among the members of the Parent Group (as defined in the EQT
RRA) exercising registration rights pursuant to Section 2.02 of the EQT RRA
related to such offering, (C) third, to any Holders who are Lead Investors and
exercising piggyback registration rights pursuant to this Section 2.02 related
to such offering, (D) fourth, pro rata among (1) all other Holders who are
exercising piggyback registration rights pursuant to this Section 2.02 related
to such offering and (2) any Persons owning shares of Common Stock, having
piggyback registration rights pari passu to those of the Holders described in
this Section 2.02(b)(ii) and exercising such piggyback registration rights and
(E) fifth, pro rata among the Company or any of the Company’s subsidiaries (to
the extent that such Person was not the Person initiating the Underwritten
Offering on its own behalf) and Persons owning shares of Common Stock, having
piggyback registration rights subordinate to those of the Holders and exercising
such piggyback registration rights (pro rata, as used in this Section 2.02,
based, for each such Person or Holder, as applicable, on the percentage derived
by dividing (x) the number of shares of Common Stock proposed to be sold by such
Person or Holder, as applicable, in such offering by (y) the aggregate number of
shares of Common Stock proposed to be sold by the Persons sharing in the same
tier of pro rata allocation).

 

Section 2.03       Underwritten Offering.

 

(a)        Common Share Registration. Subject to the limitation set forth in
Section 2.03(c) below, in the event that any of BlackRock, GSO or Magnetar
elects to dispose of Common Share Registrable Securities under a Registration
Statement pursuant to an Underwritten Offering and either (i) reasonably expects
gross proceeds of at least $65 million from such Underwritten Offering (together
with any Common Share Registrable Securities to be disposed of by a Selling
Holder who has elected to participate in such Underwritten Offering pursuant to
Section 2.02) or (ii) reasonably expects gross proceeds of at least $30 million
from such Underwritten Offering (together with any Common Share Registrable
Securities to be disposed of by a Selling Holder who has elected to participate
in such Underwritten Offering pursuant to Section 2.02) and such Common Share
Registrable Securities represent 100% of the then outstanding Common Share
Registrable Securities held by the applicable Selling Holder and Affiliates, the
Company shall, at the written request of such Selling Holder(s), enter into an
underwriting agreement in a form as is customary in Underwritten Offerings of
securities by the Company with the Managing Underwriter or Underwriters selected
by the Company (subject to the written consent of the Lead Investor initiating
such Underwritten Offering, which consent shall not be unreasonably withheld),
which shall include, among other provisions, indemnities to the effect and to
the extent provided in Section 2.08, and shall take all such other reasonable
actions as are requested by the Managing Underwriter or Underwriters in order to
expedite or facilitate the disposition of such Common Share Registrable
Securities.

 

8

 

 

(b)        Preferred Share Registration. Subject to the limitation set forth in
Section 2.03(c) below, in the event that any of BlackRock, GSO or Magnetar,
individually, or Holders holding at least 66 ⅔% of the outstanding Series A
Preferred Share Registrable Securities not held by the Lead Investors at such
time, collectively, elects to dispose of Series A Preferred Share Registrable
Securities under a Registration Statement pursuant to an Underwritten Offering
and either (i) reasonably expects gross proceeds of at least $65 million from
such Underwritten Offering or (ii) reasonably expects gross proceeds of at least
$30 million from such Underwritten Offering and such Series A Preferred Share
Registrable Securities represent 100% of the then outstanding Series A Preferred
Share Registrable Securities held by the applicable Selling Holder and
Affiliates, the Company shall, at the written request of such Selling Holder(s),
enter into an underwriting agreement in a form as is customary in Underwritten
Offerings of securities by the Company with the Managing Underwriter or
Underwriters selected by the Company (subject to the written consent of the Lead
Investor initiating such Underwritten Offering, which consent shall not be
unreasonably withheld), which shall include, among other provisions, indemnities
to the effect and to the extent provided in Section 2.08, and shall take all
such other reasonable actions as are requested by the Managing Underwriter or
Underwriters in order to expedite or facilitate the disposition of such Series A
Preferred Share Registrable Securities.

 

(c)         Limitations on Registration. The Company shall have no obligation to
facilitate or participate in, including entering into any underwriting
agreement, for more than (i) two Underwritten Offerings pursuant to Section
2.03(a) hereof at the request of BlackRock, (ii) two Underwritten Offerings
pursuant to Section 2.03(a) hereof at the request of GSO, (iii) two Underwritten
Offerings pursuant to Section 2.03(a) hereof at the request of Magnetar, (iv)
one Underwritten Offering pursuant to Section 2.03(b) hereof at the request of
BlackRock, (v) one Underwritten Offering pursuant to Section 2.03(b) hereof at
the request of GSO, (vi) one Underwritten Offering pursuant to Section 2.03(b)
hereof at the request of Magnetar and (vii) one Underwritten Offering pursuant
to Section 2.03(b) hereof at the request of Holders holding at least 66 ⅔% of
the outstanding Series A Preferred Share Registrable Securities not held by the
Lead Investors at such time; provided, further, that none of the foregoing
Underwritten Offerings in clauses (i) through (vii) above shall occur within 180
days of each other; provided, further, that if the Company or its Affiliates are
conducting or actively pursuing a securities offering of the Company’s Common
Stock and/or Series A Preferred Shares with anticipated gross offering proceeds
of at least $100 million (other than in connection with any at-the-market
offering or similar continuous offering program), then the Company may suspend
such Selling Holder’s right to require the Company to conduct an Underwritten
Offering on such Selling Holder’s behalf pursuant to this Section 2.03;
provided, however, that the Company may only suspend such Selling Holder’s right
to require the Company to conduct an Underwritten Offering pursuant to this
Section 2.03 once in any six-month period and in no event for a period that
exceeds an aggregate of 60 days in any 180-day period or 105 days in any 365-day
period.

 

9

 

 

(d)         General Procedures. In connection with any Underwritten Offering
contemplated by Section 2.03(a) or Section 2.03(b), the underwriting agreement
into which each Selling Holder and the Company shall enter shall contain such
representations, covenants, indemnities (subject to Section 2.08) and other
rights and obligations as are customary in Underwritten Offerings of securities
by the Company. No Selling Holder shall be required to make any representations
or warranties to, or agreements with, the Company or the Underwriters other than
representations, warranties or agreements regarding such Selling Holder’s
authority to enter into such underwriting agreement and to sell, and its
ownership of, the securities being registered on its behalf, its intended method
of distribution and any other representation required by law. If any Selling
Holder disapproves of the terms of an Underwritten Offering contemplated by this
Section 2.03, such Selling Holder may elect to withdraw therefrom by notice to
the Company and the Managing Underwriter; provided, however, that such
withdrawal must be made at least one (1) Business Day prior to the time of
pricing of such Underwritten Offering to be effective; provided, further, that
in the event the Managing Underwriter or Underwriters of any proposed
Underwritten Offering advise the Company that the total amount of Registrable
Securities that Holders intend to include in such offering exceeds the number
that can be sold in such offering without being likely to have an adverse effect
on the price, timing or distribution of the Registrable Securities offered or
the market for the shares of Common Stock or Series A Preferred Shares, and the
amount of Registrable Securities requested to be included in such Underwritten
Offering by the Holder that initiated such Underwritten Offering pursuant to
Section 2.03(a) or Section 2.03(b) (the “Initiating Holder”) is reduced by 50%
or more, the Initiating Holder will have the right to withdraw from such
Underwritten Offering by delivering notice to the Company at least one (1)
Business Day prior to the time of pricing of such Underwritten Offering, in
which case the Company will have no obligation to proceed with such Underwritten
Offering and such Underwritten Offering, whether or not completed, will not
decrease the number of Underwritten Offerings the Initiating Holder shall have
the right and option to request under this Section 2.03. No such withdrawal or
abandonment shall affect the Company’s obligation to pay Registration Expenses.

 

Section 2.04       Further Obligations. In connection with its obligations under
this Article II, the Company will:

 

(a)        promptly prepare and file with the Commission such amendments and
supplements to a Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective for
the Effectiveness Period and as may be necessary to comply with the provisions
of the Securities Act with respect to the disposition of all Registrable
Securities covered by such Registration Statement;

 

(b)        if a prospectus supplement will be used in connection with the
marketing of an Underwritten Offering under a Registration Statement and the
Managing Underwriter at any time shall notify the Company in writing that, in
the sole judgment of such Managing Underwriter, inclusion of detailed
information to be used in such prospectus supplement is of material importance
to the success of such Underwritten Offering, use its commercially reasonable
efforts to include such information in such prospectus supplement;

 

(c)         furnish to each Selling Holder (i) as far in advance as reasonably
practicable before filing a Registration Statement or any other registration
statement contemplated by this Agreement or any supplement or amendment thereto,
upon request, copies of reasonably complete drafts of all such documents
proposed to be filed (including exhibits and each document incorporated by
reference therein to the extent then required by the rules and regulations of
the Commission), and provide each such Selling Holder the opportunity to object
to any information pertaining to such Selling Holder and its plan of
distribution that is contained therein and, to the extent timely received, make
the corrections reasonably requested by such Selling Holder with respect to such
information prior to filing such Registration Statement or such other
registration statement and the prospectus included therein or any supplement or
amendment thereto, and (ii) such number of copies of such Registration Statement
or such other registration statement and the prospectus included therein and any
supplements and amendments thereto as such Persons may reasonably request in
order to facilitate the resale or other disposition of the Registrable
Securities covered by such Registration Statement or other registration
statement;

 

10

 

 

(d)        if applicable, use its commercially reasonable efforts to promptly
register or qualify the Registrable Securities covered by any Registration
Statement or any other registration statement contemplated by this Agreement
under the securities or blue sky laws of such jurisdictions as the Selling
Holders or, in the case of an Underwritten Offering, the Managing Underwriter,
shall reasonably request; provided, however, that the Company will not be
required to qualify generally to transact business in any jurisdiction where it
is not then required to so qualify or to take any action that would subject it
to general service of process in any such jurisdiction where it is not then so
subject;

 

(e)         promptly notify each Selling Holder, at any time when a prospectus
relating thereto is required to be delivered by any of them under the Securities
Act, of (i) the filing of a Registration Statement or any other registration
statement contemplated by this Agreement or any prospectus or prospectus
supplement to be used in connection therewith, or any amendment or supplement
thereto, and, with respect to a Registration Statement or any other registration
statement or any post-effective amendment thereto, when the same has become
effective; and (ii) the receipt of any written comments from the Commission with
respect to any filing referred to in clause (i) and any written request by the
Commission for amendments or supplements to any such Registration Statement or
any other registration statement or any prospectus or prospectus supplement
thereto;

 

(f)         promptly notify each Selling Holder, at any time when a prospectus
relating thereto is required to be delivered by any of them under the Securities
Act, of (i) the happening of any event as a result of which the prospectus or
prospectus supplement contained in a Registration Statement or any other
registration statement contemplated by this Agreement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading (in the case of any prospectus contained therein, in the light of
the circumstances under which a statement is made); (ii) the issuance or express
threat of issuance by the Commission of any stop order suspending the
effectiveness of a Registration Statement or any other registration statement
contemplated by this Agreement, or the initiation of any proceedings for that
purpose; or (iii) the receipt by the Company of any notification with respect to
the suspension of the qualification of any Registrable Securities for sale under
the applicable securities or blue sky laws of any jurisdiction. Following the
provision of such notice, the Company agrees to, as promptly as practicable,
amend or supplement the prospectus or prospectus supplement or take other
appropriate action so that the prospectus or prospectus supplement does not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing and to take such
other action as is reasonably necessary to remove a stop order, suspension,
threat thereof or proceedings related thereto;

 

11

 

 

(g)        upon request and subject to appropriate confidentiality obligations,
furnish to each Selling Holder copies of any and all transmittal letters or
other correspondence with the Commission or any other governmental agency or
self-regulatory body or other body having jurisdiction (including any domestic
or foreign securities exchange) relating to such offering of Registrable
Securities;

 

(h)        in the case of an Underwritten Offering, furnish, or use its
reasonable efforts to cause to be furnished, upon request, (i) an opinion of
counsel for the Company addressed to the Underwriters, dated as of the date of
the closing under the applicable underwriting agreement and (ii) a “comfort
letter” addressed to the Underwriters, dated as of the pricing date of such
Underwritten Offering and a letter of like kind dated as of the date of the
closing under the applicable underwriting agreement, in each case, signed by the
independent public accountants who have certified the Company’s financial
statements included or incorporated by reference into the applicable
registration statement, and each of the opinion and the “comfort letter” shall
be in customary form and covering substantially the same matters with respect to
such registration statement (and the prospectus and any prospectus supplement)
as have been customarily covered in opinions of issuer’s counsel and in
accountants’ letters delivered to the underwriters in Underwritten Offerings of
securities by the Company and such other matters as such Underwriters may
reasonably request;

 

(i)          otherwise use its commercially reasonable efforts to comply with
all applicable rules and regulations of the Commission;

 

(j)          make available to the appropriate representatives of the Managing
Underwriter during normal business hours access to such information and Company
personnel as is reasonable and customary to enable such parties to establish a
due diligence defense under the Securities Act; provided, however, that the
Company need not disclose any non-public information to any such representative
unless and until such representative has entered into a confidentiality
agreement with the Company;

 

(k)         (i) use its commercially reasonable efforts to cause all Common
Share Registrable Securities registered pursuant to this Agreement to be listed
on each securities exchange or nationally recognized quotation system on which
similar securities issued by the Company are then listed and (ii) upon the
written request of Purchasers holding a majority of the Series A Preferred Share
Registrable Securities (which majority must include two of the three Lead
Investors), use its best efforts to cause all Series A Preferred Share
Registrable Securities registered pursuant to this Agreement to be listed on the
securities exchange or nationally recognized quotation system on which Common
Share Registrable Securities are then listed;

 

(l)          use its commercially reasonable efforts to cause Registrable
Securities to be registered with or approved by such other governmental agencies
or authorities as may be necessary by virtue of the business and operations of
the Company to enable the Selling Holders to consummate the disposition of such
Registrable Securities;

 

(m)        provide a transfer agent and registrar for all Registrable Securities
covered by any Registration Statement not later than the Effective Date of such
Registration Statement;

 

12

 

 

 

(n)         enter into customary agreements and take such other actions as are
reasonably requested by the Selling Holders or the Underwriters, if any, in
order to expedite or facilitate the disposition of Registrable Securities
(including making appropriate officers of the Company available to participate
in customary marketing activities); provided, however, that the officers of the
Company shall not be required to dedicate an unreasonably burdensome amount of
time in connection with any roadshow and related marketing activities for any
Underwritten Offering;

 

(o)         if reasonably requested by a Selling Holder, (i) incorporate in a
prospectus supplement or post-effective amendment such information as such
Selling Holder reasonably requests to be included therein relating to the sale
and distribution of Registrable Securities, including information with respect
to the number of Registrable Securities being offered or sold, the purchase
price being paid therefor and any other terms of the offering of the Registrable
Securities to be sold in such offering; and (ii) make all required filings of
such prospectus supplement or post-effective amendment after being notified of
the matters to be incorporated in such prospectus supplement or post-effective
amendment;

 

(p)         if reasonably required by the Company’s transfer agent, promptly
deliver any authorizations, certificates and directions required by the transfer
agent which authorize and direct the transfer agent to transfer such Registrable
Securities without legend upon sale by the Holder of such Registrable Securities
under the Registration Statement; and

 

(q)         if any Holder could reasonably be deemed to be an “underwriter,” as
defined in Section 2(a)(11) of the Securities Act, in connection with the
Registration Statement and any amendment or supplement thereof (a “Holder
Underwriter Registration Statement”), then reasonably cooperate with such Holder
in allowing such Holder to conduct customary “underwriter’s due diligence” with
respect to the Company and satisfy its obligations in respect thereof. In
addition, at any Holder’s request, the Company will furnish to such Holder, on
the date of the effectiveness of the Holder Underwriter Registration Statement
and thereafter from time to time on such dates as such Holder may reasonably
request (provided that such request shall not be more frequently than on an
annual basis unless such Holder is offering Registrable Securities pursuant to a
Holder Underwriter Registration Statement), (i) a “comfort letter”, dated as of
such date, from the Company’s independent certified public accountants in form
and substance as has been customarily given by independent certified public
accountants to underwriters in Underwritten Offerings of securities by the
Company, addressed to such Holder, (ii) an opinion, dated as of such date, of
counsel representing the Company for purposes of the Holder Underwriter
Registration Statement, in form, scope and substance as has been customarily
given in Underwritten Offerings of securities by the Company, including standard
“10b-5” negative assurance for such offerings, addressed to such Holder and
(iii) a standard officer’s certificate from the chief executive officer or chief
financial officer, or other officers serving such functions, of the Company
addressed to the Holder, as has been customarily given by such officers in
Underwritten Offerings of securities by the Company. The Company will also use
its reasonable efforts to provide legal counsel to such Holder with an
opportunity to review and comment upon any such Holder Underwriter Registration
Statement, and any amendments and supplements thereto, prior to its filing with
the Commission.

 

13

 

 

Notwithstanding anything to the contrary in this Section 2.04, the Company will
not name a Holder as an underwriter (as defined in Section 2(a)(11) of the
Securities Act) in any Registration Statement or Holder Underwriter Registration
Statement, as applicable, without such Holder’s consent. If the staff of the
Commission requires the Company to name any Holder as an underwriter (as defined
in Section 2(a)(11) of the Securities Act), and such Holder does not consent
thereto, then such Holder’s Registrable Securities shall not be included on the
applicable Registration Statement, and the Company shall have no further
obligations hereunder with respect to Registrable Securities held by such
Holder, unless such Holder has not had an opportunity to conduct customary
underwriter’s due diligence as set forth in subsection (q) of this Section 2.04
with respect to the Company at the time such Holder’s consent is sought.

 

Each Selling Holder, upon receipt of notice from the Company of the happening of
any event of the kind described in subsection (f) of this Section 2.04, shall
forthwith discontinue offers and sales of the Registrable Securities by means of
a prospectus or prospectus supplement until such Selling Holder’s receipt of the
copies of the supplemented or amended prospectus contemplated by subsection (f)
of this Section 2.04 or until it is advised in writing by the Company that the
use of the prospectus may be resumed and has received copies of any additional
or supplemental filings incorporated by reference in the prospectus, and, if so
directed by the Company, such Selling Holder will, or will request the Managing
Underwriter or Managing Underwriters, if any, to deliver to the Company (at the
Company’s expense) all copies in their possession or control, other than
permanent file copies then in such Selling Holder’s possession, of the
prospectus covering such Registrable Securities current at the time of receipt
of such notice.

 

Section 2.05      Cooperation by Holders. The Company shall have no obligation
to include Registrable Securities of a Holder in a Registration Statement or in
an Underwritten Offering pursuant to Section 2.03(a) or Section 2.03(b) if such
Holder has failed to timely furnish such information that the Company
determines, after consultation with its counsel, is reasonably required in order
for any registration statement or prospectus supplement, as applicable, to
comply with the Securities Act.

 

Section 2.06      Restrictions on Public Sale by Holders of Registrable
Securities. Each Holder of Registrable Securities who is participating in an
Underwritten Offering agrees to enter into a customary letter agreement with
Underwriters providing that such Holder will not effect any public sale or
distribution of Registrable Securities during the 45 calendar day period
beginning on the date of a prospectus or prospectus supplement filed with the
Commission with respect to the pricing of such Underwritten Offering; provided,
however, that, notwithstanding the foregoing, (i) the duration of the foregoing
restrictions shall be no longer than the duration of the shortest restriction
imposed by the Underwriters on the Company or the officers, directors or any
other Affiliate of the Company on whom a restriction is imposed and (ii) the
restrictions set forth in this Section 2.06 shall not apply to any Registrable
Securities that are included in such Underwritten Offering by such Holder.

 

14

 

 

Section 2.07       Expenses.

 

(a)         Certain Definitions. “Registration Expenses” shall not include
Selling Expenses but otherwise means all expenses incident to the Company’s
performance under or compliance with this Agreement to effect the registration
of Registrable Securities on a Registration Statement pursuant to Section 2.01,
a Piggyback Registration pursuant to Section 2.02, or an Underwritten Offering
pursuant to Section 2.03, and the disposition of such Registrable Securities,
including all registration, filing, securities exchange listing and National
Securities Exchange fees, all registration, filing, qualification and other fees
and expenses of complying with securities or blue sky laws, fees of the
Financial Industry Regulatory Authority, fees of transfer agents and registrars,
all word processing, duplicating and printing expenses, and the fees and
disbursements of counsel and independent public accountants for the Company,
including the expenses of any special audits or “cold comfort” letters required
by or incident to such performance and compliance. “Selling Expenses” means all
underwriting fees, discounts and selling commissions and transfer taxes
allocable to the sale of the Registrable Securities, plus any costs or expenses
related to any roadshows conducted in connection with the marketing of any
Underwritten Offering.

 

(b)         Expenses. The Company will pay all reasonable Registration Expenses,
as determined in good faith, in connection with a shelf Registration, a
Piggyback Registration or an Underwritten Offering, whether or not any sale is
made pursuant to such shelf Registration, Piggyback Registration or Underwritten
Offering. Each Selling Holder shall pay its pro rata share of all Selling
Expenses in connection with any sale of its Registrable Securities hereunder. In
addition, except as otherwise provided in Section 2.08, the Company shall not be
responsible for professional fees (including legal fees) incurred by Holders in
connection with the exercise of such Holders’ rights hereunder.

 

Section 2.08       Indemnification.

 

(a)         By the Company. In the event of a registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, the Company will
indemnify and hold harmless each Selling Holder thereunder, its directors,
officers, managers, partners, employees and agents and each Person, if any, who
controls such Selling Holder within the meaning of the Securities Act and the
Exchange Act, and its directors, officers, managers, partners, employees or
agents (collectively, the “Selling Holder Indemnified Persons”), against any
losses, claims, damages, expenses or liabilities (including reasonable
attorneys’ fees and expenses) (collectively, “Losses”), joint or several, to
which such Selling Holder Indemnified Person may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such Losses (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact (in the case of any prospectus, in light of the
circumstances under which such statement is made) contained in (which, for the
avoidance of doubt, includes documents incorporated by reference in) the
applicable Registration Statement or other registration statement contemplated
by this Agreement, any preliminary prospectus, prospectus supplement or final
prospectus contained therein, or any amendment or supplement thereof, or any
free writing prospectus relating thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
prospectus, in light of the circumstances under which they were made) not
misleading, and will reimburse each such Selling Holder Indemnified Person for
any legal or other expenses reasonably incurred by them in connection with
investigating, defending or resolving any such Loss or actions or proceedings;
provided, however, that the Company will not be liable in any such case if and
to the extent that any such Loss arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by such Selling Holder Indemnified Person
in writing specifically for use in the applicable Registration Statement or
other registration statement, preliminary prospectus, prospectus supplement or
final prospectus, or amendment or supplement thereto, or any free writing
prospectus relating thereto, as applicable. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of such
Selling Holder Indemnified Person, and shall survive the transfer of such
securities by such Selling Holder.

 

15

 

 

(b)         By Each Selling Holder. Each Selling Holder agrees severally and not
jointly to indemnify and hold harmless the Company and its directors, officers,
employees and agents and each Person, who, directly or indirectly, controls the
Company within the meaning of the Securities Act or of the Exchange Act to the
same extent as the foregoing indemnity from the Company to the Selling Holders,
but only with respect to information regarding such Selling Holder furnished in
writing by or on behalf of such Selling Holder expressly for inclusion in a
Registration Statement or any other registration statement contemplated by this
Agreement, any preliminary prospectus, prospectus supplement or final prospectus
contained therein, or any amendment or supplement thereto or any free writing
prospectus relating thereto; provided, however, that the liability of each
Selling Holder shall not be greater in amount than the dollar amount of the
proceeds (net of any Selling Expenses) received by such Selling Holder from the
sale of the Registrable Securities giving rise to such indemnification.

 

(c)          Notice. Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party hereunder,
notify the indemnifying party in writing thereof, but the omission to so notify
the indemnifying party shall not relieve it from any liability that it may have
to any indemnified party other than under this Section 2.08(c), except to the
extent that the indemnifying party is materially prejudiced by such failure. In
any action brought against any indemnified party, it shall notify the
indemnifying party of the commencement thereof. The indemnifying party shall be
entitled to participate in and, to the extent it shall wish, to assume and
undertake the defense thereof with counsel reasonably satisfactory to such
indemnified party and, after notice from the indemnifying party to such
indemnified party of its election so to assume and undertake the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under this Section 2.08 for any legal expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation and of liaison with counsel so selected; provided,
however, that, (i) if the indemnifying party has failed to assume the defense or
employ counsel reasonably satisfactory to the indemnified party or (ii) if the
defendants in any such action include both the indemnified party and the
indemnifying party and counsel to the indemnified party shall have concluded
that there may be reasonable defenses available to the indemnified party that
are different from or additional to those available to the indemnifying party,
or if the interests of the indemnified party reasonably may be deemed to
conflict with the interests of the indemnifying party, then the indemnified
party shall have the right to select a separate counsel and to assume such legal
defense and otherwise to participate in the defense of such action, with the
reasonable expenses and fees of such separate counsel and other reasonable
expenses related to such participation to be reimbursed by the indemnifying
party as incurred. Notwithstanding any other provision of this Agreement, no
indemnifying party shall settle any action brought against any indemnified party
with respect to which such indemnified party may be entitled to indemnification
hereunder without the consent of the indemnified party, unless the settlement
thereof imposes no liability or obligation on, includes a complete and
unconditional release from liability of, and does not contain any admission of
wrongdoing by, the indemnified party.

 

16

 

 

(d)         Contribution. If the indemnification provided for in this Section
2.08 is held by a court or government agency of competent jurisdiction to be
unavailable to any indemnified party or is insufficient to hold them harmless in
respect of any Losses, then each such indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such Losses in such proportion
as is appropriate to reflect the relative fault of the indemnifying party, on
the one hand, and of the indemnified party, on the other hand, in connection
with the statements or omissions that resulted in such Losses, as well as any
other relevant equitable considerations; provided, however, that in no event
shall any Selling Holder be required to contribute an aggregate amount in excess
of the dollar amount of proceeds (net of Selling Expenses) received by such
Selling Holder from the sale of Registrable Securities giving rise to such
indemnification. The relative fault of the indemnifying party, on the one hand,
and the indemnified party, on the other hand, shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact has
been made by, or relates to, information supplied by such party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The parties hereto agree that it
would not be just and equitable if contributions pursuant to this paragraph were
to be determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to herein.
The amount paid by an indemnified party as a result of the Losses referred to in
the first sentence of this paragraph shall be deemed to include any legal and
other expenses reasonably incurred by such indemnified party in connection with
investigating, defending or resolving any Loss that is the subject of this
paragraph. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who is not guilty of such fraudulent misrepresentation.

 

(e)         Other Indemnification. The provisions of this Section 2.08 shall be
in addition to any other rights to indemnification or contribution that an
indemnified party may have pursuant to law, equity, contract or otherwise.

 

Section 2.09       Rule 144 Reporting. With a view to making available the
benefits of certain rules and regulations of the Commission that may permit the
resale of the Registrable Securities without registration, the Company agrees to
use its commercially reasonable efforts to:

 

(a)         make and keep public information regarding the Company available, as
those terms are understood and defined in Rule 144 under the Securities Act (or
any similar provision then in effect), at all times from and after the date
hereof;

 

(b)         file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act
at all times from and after the date hereof; and

 

17

 

 

(c)         so long as a Holder owns any Registrable Securities, furnish (i) to
the extent accurate, forthwith upon request, a written statement of the Company
that it has complied with the reporting requirements of Rule 144 under the
Securities Act (or any similar provision then in effect) and (ii) unless
otherwise available via the Commission’s EDGAR filing system, to such Holder
forthwith upon request a copy of the most recent annual or quarterly report of
the Company, and such other reports and documents so filed as such Holder may
reasonably request in availing itself of any rule or regulation of the
Commission allowing such Holder to sell any such securities without
registration.

 

Section 2.10       Transfer or Assignment of Registration Rights. The rights to
cause the Company to register Registrable Securities under this Article II may
be transferred or assigned by each Holder to one or more transferees or
assignees of Registrable Securities; provided, however, that (a) unless any such
transferee or assignee is an Affiliate of, and after such transfer or assignment
continues to be an Affiliate of, such Holder, the amount of Registrable
Securities transferred or assigned to such transferee or assignee shall
represent at least $30 million of Registrable Securities, calculated on the
basis of the Purchased Share Price or such lesser amount if it constitutes the
remaining holdings of the Holder and its Affiliates, (b) the Company is given
written notice prior to any said transfer or assignment, stating the name and
address of each such transferee or assignee and identifying the securities with
respect to which such registration rights are being transferred or assigned and
(c) each such transferee or assignee assumes in writing responsibility for its
portion of the obligations of such transferring Holder under this Agreement.

 

Section 2.11      Limitation on Subsequent Registration Rights. From and after
the date hereof, the Company shall not, without the prior written consent of the
Holders of at least the Registrable Securities Required Voting Percentage, enter
into any agreement with any current or future holder of any securities of the
Company that would allow such current or future holder to require the Company to
include securities in any registration statement filed by the Company for Other
Holders on a basis other than pari passu with, or expressly subordinate to, the
piggyback rights of the Holders of Common Share Registrable Securities
hereunder; provided, that in no event shall the Company enter into any agreement
that would permit another holder of securities of the Company to participate on
a superior or pari passu basis (in terms of priority of cut-back based on advice
of Underwriters) with a Holder requesting registration or takedown in an
Underwritten Offering pursuant to Section 2.03(a) or Section 2.03(b).

 

Section 2.12      Limitation on Obligations for Series A Preferred Share
Registrable Securities. Notwithstanding anything to the contrary in this
Agreement, nothing contained herein shall be construed to require the Company to
provide any Holder of Series A Preferred Share Registrable Securities any rights
to include any Series A Preferred Share Registrable Securities in any
underwritten offering relating to the sale by the Company or any other Person of
any securities of the Company.

 

18

 

 

Section 2.13       Obligation to Obtain Rating for Series A Preferred Shares. If
requested by any of the Lead Investors, the Company shall use commercially
reasonable efforts to obtain and maintain a rating from a nationally recognized
rating agency (chosen by such Holders) with respect to the Series A Preferred
Shares until the date on which all Series A Preferred Shares have been converted
into shares of Common Stock. The Company shall be entitled to reimbursement from
the Holders holding Series A Preferred Shares for all direct costs paid to the
applicable rating agency by the Company in obtaining the initial rating, which
costs shall be shared by such Holders pro rata (based, for each such Holder on
the percentage derived by dividing (x) the number of Series A Preferred Shares
held by each such Holder, by (y) the aggregate number of Series A Preferred
Shares outstanding at the time such rating is obtained). After the date on which
a rating has been obtained for the Series A Preferred Shares, if requested by
the Holders of 75% of the Series A Preferred Shares then outstanding, the
Company shall use commercially reasonably efforts to cause such rating on the
Series A Preferred Shares to be withdrawn.

  

Article III.
MISCELLANEOUS

 

Section 3.01      Communications. All notices, demands and other communications
provided for hereunder shall be in writing and shall be given by registered or
certified mail, return receipt requested, telecopy, air courier guaranteeing
overnight delivery, personal delivery or (in the case of any notice given by the
Shares to the Purchasers) email to the following addresses:

 

(a)         If to the Purchasers, to the addresses set forth on Schedule A.

 

(b)        If to the Company:

 

Equitrans Midstream Corporation 2200 Energy Drive Canonsburg, Pennsylvania 15317
Attention: Kirk Oliver   Stephen M. Moore Email: koliver@equitransmidstream.com
  smoore@equitransmidstream.com

 

with copies to (which shall not constitute notice):

 

Latham & Watkins LLP 811 Main Street Suite 3700 Houston TX 77002 Attention: Ryan
J. Maierson   Nick S. Dhesi
Email: ryan.maierson@lw.com
    nick.dhesi@lw.com

 

or to such other address as the Company or the Purchasers may designate to each
other in writing from time to time or, if to a transferee or assignee of the
Purchasers or any transferee or assignee thereof, to such transferee or assignee
at the address provided pursuant to Section 2.10. All notices and communications
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; upon actual receipt if sent by certified or registered
mail, return receipt requested, or regular mail, if mailed; upon actual receipt
of the facsimile or email copy, if sent via facsimile or email; and upon actual
receipt when delivered to an air courier guaranteeing overnight delivery.

 

19

 

 

Section 3.02      Binding Effect. This Agreement shall be binding upon the
Company, each of the Purchasers and their respective successors and permitted
assigns, including binding upon (i) in the case of the Company, any Person that
will be a successor to the Company, whether in connection with a Change of
Control or Company Restructuring Event or by merger, consolidation,
reorganization, charter amendment, sale of all or substantially all assets or
otherwise and (ii) in the case of the Purchasers, subsequent Holders of
Registrable Securities to the extent permitted herein. Except as expressly
provided in this Agreement, this Agreement shall not be construed so as to
confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and permitted assigns.

 

Section 3.03      Assignment of Rights. Except as provided in Section 2.10 and
as contemplated by Section 3.02, neither this Agreement nor any of the rights,
benefits or obligations hereunder may be assigned or transferred, by operation
of law or otherwise, by any party hereto without the prior written consent of
the other party.

 

Section 3.04      Recapitalization, Exchanges, Etc. Affecting Shares. The
provisions of this Agreement shall apply to the full extent set forth herein
with respect to any and all shares of the Company or any successor or assign of
the Company (whether in connection with a Change of Control or Company
Restructuring Event or by merger, acquisition, consolidation, reorganization,
sale of assets or otherwise) that may be issued in respect of, in exchange for
or in substitution of, the Registrable Securities, and shall be appropriately
adjusted for combinations, share splits, recapitalizations, pro rata
distributions of shares and the like occurring after the date of this Agreement.
As a condition to the effectiveness of any transaction discussed in the prior
sentence, the Company shall make provision to ensure that any successor or
assign of the Company either (i) acknowledges, adopts and assumes in full the
Company’s obligations pursuant to this Agreement or (ii) enters into a new
registration rights agreements with the holders of the Series A Preferred Shares
providing for the same rights set forth herein.

 

Section 3.05      Aggregation of Registrable Securities. All Registrable
Securities held or acquired by Persons who are Affiliates of one another shall
be aggregated together for the purpose of determining the availability of any
rights under this Agreement.

 

Section 3.06      Specific Performance. Damages in the event of breach of this
Agreement by a party hereto may be difficult, if not impossible, to ascertain,
and it is therefore agreed that each such Person, in addition to and without
limiting any other remedy or right it may have, will have the right to seek an
injunction or other equitable relief in any court of competent jurisdiction,
enjoining any such breach, and enforcing specifically the terms and provisions
hereof, and each of the parties hereto hereby waives any and all defenses it may
have on the ground of lack of jurisdiction or competence of the court to grant
such an injunction or other equitable relief. The existence of this right will
not preclude any such Person from pursuing any other rights and remedies at law
or in equity that such Person may have.

 

Section 3.07      Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute but one
and the same agreement.

 

20

 

 

Section 3.08      Governing Law, Submission to Jurisdiction. This Agreement, and
all claims or causes of action (whether in contract or tort) that may be based
upon, arise out of or relate to this Agreement or the negotiation, execution or
performance of this Agreement (including any claim or cause of action based
upon, arising out of or related to any representation or warranty made in or in
connection with this Agreement), will be construed in accordance with and
governed by the laws of the State of Delaware without regard to principles of
conflicts of laws. Any action against any party relating to the foregoing shall
be brought in any federal or state court of competent jurisdiction located
within the State of Delaware, and the parties hereto hereby irrevocably submit
to the exclusive jurisdiction of any federal or state court located within the
State of Delaware over any such action. The parties hereby irrevocably waive, to
the fullest extent permitted by applicable law, any objection which they may now
or hereafter have to the laying of venue of any such dispute brought in such
court or any defense of inconvenient forum for the maintenance of such dispute.
Each of the parties hereto agrees that a judgment in any such dispute may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.

 

Section 3.09      Waiver of Jury Trial. THE PARTIES TO THIS AGREEMENT EACH
HEREBY WAIVE, AND AGREE TO CAUSE THEIR AFFILIATES TO WAIVE, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION (A) ARISING UNDER THIS AGREEMENT OR (B) IN ANY WAY CONNECTED
WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT
OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY
OR OTHERWISE. THE PARTIES TO THIS AGREEMENT EACH HEREBY AGREE AND CONSENT THAT
ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT
TRIAL WITHOUT A JURY AND THAT THE PARTIES TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

Section 3.10      Entire Agreement. This Agreement, the Restructuring Agreement
and the other agreements and documents referred to herein and therein are
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein and therein.
There are no restrictions, promises, warranties or undertakings, other than
those set forth or referred to herein or in the Restructuring Agreement with
respect to the rights granted by the Company or any of its Affiliates or the
Purchasers or any of their respective Affiliates set forth herein or therein.
This Agreement, the Restructuring Agreement and the other agreements and
documents referred to herein or therein supersede all prior agreements and
understandings between the parties with respect to such subject matter.

 

Section 3.11      Amendment. This Agreement may be amended only by means of a
written amendment signed by the Company and the Holders of at least the
Registrable Securities Required Voting Percentage; provided, however, that no
such amendment shall adversely affect the rights of any Holder hereunder without
the consent of such Holder. Any amendment, supplement or modification of or to
any provision of this Agreement, any waiver of any provision of this Agreement,
and any consent to any departure by the Company or any Holder from the terms of
any provision of this Agreement shall be effective only in the specific instance
and for the specific purpose for which such amendment, supplement, modification,
waiver or consent has been made or given.

 

21

 

 

Section 3.12      No Presumption. This Agreement has been reviewed and
negotiated by sophisticated parties with access to legal counsel and shall not
be construed against the drafter.

 

Section 3.13      Obligations Limited to Parties to Agreement. Each of the
parties hereto covenants, agrees and acknowledges that, other than as set forth
herein, no Person other than the Purchasers, the Holders, their respective
permitted assignees and the Company shall have any obligation hereunder and
that, notwithstanding that one or more of such Persons may be a corporation,
partnership or limited liability company, no recourse under this Agreement or
under any documents or instruments delivered in connection herewith shall be had
against any former, current or future director, officer, employee, agent,
general or limited partner, manager, member, shareholder or Affiliate of any of
such Persons or their respective permitted assignees, or any former, current or
future director, officer, employee, agent, general or limited partner, manager,
member, shareholder or Affiliate of any of the foregoing, whether by the
enforcement of any assessment or by any legal or equitable proceeding, or by
virtue of any applicable law, it being expressly agreed and acknowledged that no
personal liability whatsoever shall attach to, be imposed on or otherwise be
incurred by any former, current or future director, officer, employee, agent,
general or limited partner, manager, member, shareholder or Affiliate of any of
such Persons or any of their respective assignees, or any former, current or
future director, officer, employee, agent, general or limited partner, manager,
member, shareholder or Affiliate of any of the foregoing, as such, for any
obligations of such Persons or their respective permitted assignees under this
Agreement or any documents or instruments delivered in connection herewith or
for any claim based on, in respect of or by reason of such obligation or its
creation, except, in each case, for any assignee of any Purchaser or a Selling
Holder hereunder.

 

Section 3.14      Interpretation. Article, Section and Schedule references in
this Agreement are references to the corresponding Article, Section or Schedule
to this Agreement, unless otherwise specified. All Schedules to this Agreement
are hereby incorporated and made a part hereof as if set forth in full herein
and are an integral part of this Agreement. All references to instruments,
documents, contracts and agreements are references to such instruments,
documents, contracts and agreements as the same may be amended, supplemented and
otherwise modified from time to time, unless otherwise specified. The word
“including” shall mean “including but not limited to” and shall not be construed
to limit any general statement that it follows to the specific or similar items
or matters immediately following it. Whenever the Company has an obligation
under this Agreement, the expense of complying with that obligation shall be an
expense of the Company unless otherwise specified. Any reference in this
Agreement to “$” shall mean U.S. dollars. Whenever any determination, consent or
approval is to be made or given by a Purchaser, such action shall be in such
Holder’s sole discretion, unless otherwise specified in this Agreement. If any
provision in this Agreement is held to be illegal, invalid, not binding or
unenforceable, (a) such provision shall be fully severable and this Agreement
shall be construed and enforced as if such illegal, invalid, not binding or
unenforceable provision had never comprised a part of this Agreement, and the
remaining provisions shall remain in full force and effect, and (b) the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent possible. When calculating the
period of time before which, within which or following which any act is to be
done or step taken pursuant to this Agreement, the date that is the reference
date in calculating such period shall be excluded. If the last day of such
period is a non-Business Day, the period in question shall end on the next
succeeding Business Day. Any words imparting the singular number only shall
include the plural and vice versa. The words such as “herein,” “hereinafter,”
“hereof” and “hereunder” refer to this Agreement as a whole and not merely to a
subdivision in which such words appear unless the context otherwise requires.
The provision of a Table of Contents, the division of this Agreement into
Articles, Sections and other subdivisions and the insertion of headings are for
convenience of reference only and shall not affect or be utilized in construing
or interpreting this Agreement.

 

[Remainder of Page Left Intentionally Blank]

 

22

 

 

IN WITNESS WHEREOF, the parties hereto execute this Agreement, effective as of
the date first above written.

 

  Equitrans Midstream Corporation               By:   Name: Kirk R. Oliver  
Title: Senior Vice President and Chief Financial Officer

 

[Signature page to Registration Rights Agreement]

 

 

 

 

  INVESTMENT PARTNERS V (II), LLC       By: BAA Co-Investment Fund (GenPar),
LLC, its sole member       By: BlackRock Financial Management, Inc., its sole
member       By:   Name:     Title:  

 

  GEPIF III EQM HOLDINGS, L.P.       By: GEPIF III EQM Holdings GP, LLC, its
general partner       By:   Name:     Title:  

 

[Signature page to Registration Rights Agreement]

 

 

 

 

  GSO EQUITABLE FINANCE LP       By: GSO Equitable Finance Holdings LLC, its
general partner           By:   Name:     Title:  

 

  MTP ENERGY OPPORTUNITIES FUND II LLC       By: MTP Energy Management LLC, its
managing member       By: Magnetar Financial LLC, its sole member       By:  
Name:     Title:  

 

  MTP EOF II IP LLC       By: MTP Energy Management LLC, its managing member    
  By: Magnetar Financial LLC, its sole member       By:   Name:     Title:  

 

[Signature page to Registration Rights Agreement]

 

 

 

 

  MTP ENERGY MASTER FUND LLC       By: MTP Energy Management LLC, its manager  
    By: Magnetar Financial LLC, its sole member       By:   Name:     Title:  

 

  MAGNETAR STRUCTURED CREDIT FUND, LP       By: Magnetar Financial LLC, its
general partner       By:   Name:     Title:  

 

  MAGNETAR CONSTELLATION FUND V LLC       By: Magnetar Financial LLC, its
manager       By:   Name:     Title:  

 

  MAGNETAR LONGHORN FUND LP       By: Magnetar Financial LLC, its investment
manager       By:   Name:     Title:  

 

[Signature page to Registration Rights Agreement]

 

 

 

 

  SERIES V, A SERIES OF ASTRUM PARTNERS LLC       By: Magnetar Financial LLC,
its manager       By:     Name:     Title:  

 

  BSOF QMODEM (M) 2 L.P.       By: Magnetar Financial LLC, its advisor       By:
  Name:     Title:  

 

  MTP EMERALD FUND LLC       By: MTP Energy Management LLC, its manager        
By: Magnetar Financial LLC, its sole member       By:   Name:     Title:        
CEQM HOLDINGS, LLC       By:   Name:     Title:                 NB BURLINGTON
AGGREGATOR LP       By:   Name:     Title:  

 

[Signature page to Registration Rights Agreement]

 

 

 

 

  KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY           By: KA Fund
Advisors, LLC, its manager         By:     Name:     Title:                
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.         By: KA Fund Advisors, LLC,
its manager         By:     Name:     Title:                 TORTOISE DIRECT
OPPORTUNITIES FUND II, LP         By: Tortoise Direct Opportunities GP II LLC,
its general partner         By:     Name:     Title:                 PORTCULLIS
PARTNERS, LP       By:     Name:     Title:        

 

[Signature page to Registration Rights Agreement]

 

 

 

 

  CENTAURUS CAPITAL LP       By: Centaurus Holdings, LLC, its general partner  
    By:     Name:     Title:  

 

[Signature page to Registration Rights Agreement]

 

 

 

 

Schedule A 

 

Purchaser Name; Notice and Contact Information

 

Purchaser

 

Contact Information

BlackRock     GEPIF III EQM HOLDINGS, L.P.  

C/O BlackRock Financial Management, Inc.

609 Main Street

Houston, TX 77002

Attention: Mark Saxe

Email:  mark.saxe@blackrock.com

 

With copy to:

c/o BlackRock, Inc.

Office of the General Counsel

40 East 52nd Street

New York, NY 10022

Attention: David Maryles and Jelena Napolitano

Email: legaltransactions@blackrock.com

 

      GSO     GSO EQUITABLE FINANCE LP  

GSO Equitable Finance LP

c/o GSO Capital Partners LP

345 Park Avenue, 31st Floor

New York, NY 10154

Attention: Robert Horn

Email: robert.horn@gsocap.com; GSOLegal@gsocap.com

 

 

A-1

 

 

Magnetar     MTP ENERGY OPPORTUNITIES FUND II LLC  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

MTP EOF II IP LLC  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

MTP ENERGY MASTER FUND LLC  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

MAGNETAR STRUCTURED CREDIT FUND, LP  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

MAGNETAR CONSTELLATION FUND V LLC  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

MAGNETAR LONGHORN FUND LP  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

SERIES V, A SERIES OF ASTRUM PARTNERS LLC  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

BSOF QMODEM (M) 2 L.P.  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

MTP EMERALD FUND LLC  

Magnetar Financial LLC 

1603 Orrington Ave, 13th Floor

Evanston, IL 60201

Email: MTP_Notices@magnetar.com

 

 

A-2

 

 

Other     CEQM HOLDINGS, LLC  

CEQM Holdings, LLC

520 Madison Avenue, 38th Floor

New York, NY 10022

Attention: Arleen Spangler; Emily Chang

Email: Arleen.Spangler@carlyle.com;

Emily.Chang@carlyle.com

 

NB BURLINGTON AGGREGATOR LP  

NB Burlington Aggregator LP

c/o David Lyon

Neuberger Berman

1290 Avenue of the Americas 43rd Floor

New York, NY 10104

David.lyon@nb.com

 

With copies to

 

Dean Winick

Neuberger Berman

1290 Avenue of the Americas 24th Floor

New York, NY 10104

Dean.winick@nb.com

 

INVESTMENT PARTNERS V (II), LLC  

C/O BlackRock Financial Management, Inc.

40 East 52nd Street

New York, NY 10022

Attention: Stephen Kavulich

Email:  GroupBAACorePM@blackrock.com

 

With copy to:

c/o BlackRock, Inc.

Office of the General Counsel

40 East 52nd Street

New York, NY 10022

Attention: David Maryles and Jelena Napolitano

Email: legaltransactions@blackrock.com

 

TORTOISE DIRECT OPPORTUNITIES FUND II, LP  

C/O Tortoise Capital Advisors

5100 W. 115th Place

Leawood, KS 66211

 

KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY  

KA Fund Advisors, LLC

Attention: James C. Baker

811 Main Street, 14th Floor

Houston, TX 77002

 

 

A-3

 

 

KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.  

KA Fund Advisors, LLC

Attention: James C. Baker

811 Main Street, 14th Floor

Houston, TX 77002

 

CENTAURUS CAPITAL LP  

1717 West Loop South, Suite 1800

Houston, TX 77027

 

PORTCULLIS PARTNERS, LP  

Portcullis Partners, LP

11 Greenway Plaza, Suite 2000

Houston, TX 77046

duanekelley@wvmorgan.com

(713) 877-8033

 

A-4

 

 

Schedule B 

 

purchasers deemed to have delivered the Piggyback opt-out notice

 

1.None

 

B-1

 

 

 

Exhibit B
 

Form of Certificate of Designations

 

[See attached.]

 

 

Exhibit B
Preferred Restructuring Agreement

 

 

 

 

CERTIFICATE OF DESIGNATIONS OF
SERIES A PREFERRED STOCK
OF EQUITRANS MIDSTREAM CORPORATION

 

Pursuant to Section 1522 of the Pennsylvania Business Corporation Law (the
“Pennsylvania BCL”):

 

EQUITRANS MIDSTREAM CORPORATION, a corporation organized and existing under the
laws of the Commonwealth of Pennsylvania, certifies that pursuant to the
authority contained in Article Fifth of the Company’s Amended and Restated
Articles of Incorporation (the “Articles of Incorporation”), and in accordance
with the provisions of Section 1522 of the Pennsylvania BCL, the Board of
Directors duly approved and adopted on February 26, 2020 the following
resolution, which resolution remains in full force and effect on the date
hereof, and that the aggregate number of shares of such class or series
established and designated by such resolution, all prior statements, if any,
filed under Section 1522 of the Pennsylvania BCL or corresponding provisions of
prior law with respect thereto and any other provision of the Articles of
Incorporation is [ ˜ ] shares:

 

RESOLVED, that pursuant to the provisions of the Articles of Incorporation of
the Company (which authorize 50,000,000 shares of preferred stock, without par
value), and the authority thereby vested in the Board of Directors, a series of
preferred stock be, and it hereby is, created, and that the designation and
number of shares of such series, and the voting and other powers, preferences
and relative, participating, optional or other rights, and the qualifications,
limitations and restrictions thereof are as set forth in the Articles of
Incorporation and herein:

 

Section 1               Designation and Amount; Ranking.

 

(a)                 There shall be created from the 50,000,000 shares of
preferred stock, no par value, of the Company authorized to be issued pursuant
to the Articles of Incorporation, a series of preferred stock, designated as the
“Series A Perpetual Convertible Preferred Shares,” no par value (the “Series A
Preferred Stock”), and the authorized number of shares of Series A Preferred
Stock shall be [ ˜ ] shares. Shares of the Series A Preferred Stock that are
redeemed, purchased or otherwise acquired by the Company, or converted into
shares of Common Stock, shall be cancelled, shall revert to authorized but
unissued shares of preferred stock of the Company undesignated as to series.

 

(b)                The Series A Preferred Stock, with respect to dividend rights
and rights upon the liquidation, winding-up or dissolution of the Company,
ranks: (i) senior in all respects to all Junior Stock; (ii) on a parity in all
respects with all Parity Stock; and (iii) junior in all respects to all Senior
Stock, in each case as provided more fully herein.

 

Section 2               Definitions.

 

As used herein, the following terms shall have the following meanings:

 

“Accrued Dividends” shall mean, with respect to any share of Series A Preferred
Stock, as of any date, the accrued and unpaid dividends on such share from, and
including, the Issue Date to, but not including, such date (including for the
avoidance of doubt, any Partial Period Dividends).

 

“Adjustment Date” shall have the meaning set forth in the definition of “Closing
Sale Price.”

 

“Affiliate” shall mean 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. As used
herein, the term “control” means the possession, direct or indirect, 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. Notwithstanding anything to the contrary provided herein, for
purposes of this Certificate of Designations, no Holder shall be considered an
Affiliate of the Company or its Subsidiaries, and no Holder or any of its
Affiliates shall be considered Affiliates of any other Holder or any of such
other Holder’s Affiliates, in either case, solely by virtue of such Holder’s
ownership of shares of Series A Preferred Stock. Notwithstanding anything in
this definition to the contrary, for purposes of this Certificate of
Designations, (a) the Company and its Subsidiaries, on the one hand, and any
Holder, on the other hand, shall not be considered Affiliates and (b) any fund
or account managed, advised or subadvised, directly or indirectly, by a Holder
or its Affiliates, shall be considered an Affiliate of such Holder. For the
avoidance of doubt, EQT Corporation shall not be considered an Affiliate of the
Company for purposes of this Certificate of Designations.

 

 

 

“Amended and Restated Bylaws” shall mean the Second Amended and Restated Bylaws
of the Company.

 

“Articles of Incorporation” shall mean the Amended and Restated Articles of
Incorporation of the Company, as modified by this Certificate of Designations,
as further amended or restated in accordance with applicable law and this
Certificate of Designations.

 

“Average VWAP” per share over a certain period shall mean the arithmetic average
of the VWAP per share for each Trading Day in such period.

 

“Board Observer” shall have the meaning set forth in Section 4(k).

 

“Board of Directors” shall mean the Board of Directors of the Company or, with
respect to any action to be taken by the Board of Directors, any committee of
the Board of Directors duly authorized to take such action.

 

“Business Day” shall mean Monday through Friday of each week, except that a
legal holiday recognized as such by the government of the United States of
America or the Commonwealth of Pennsylvania shall not be regarded as a Business
Day.

 

“Cash Change of Control” shall mean the occurrence of a Change of Control that
involves consideration payable to the Company, or in respect of the Company’s
Common Stock, that is comprised of at least 90% cash.

 

“Cash Dividend Catch-Up” shall have the meaning set forth in Section 4(j).

 

“Cash Dividends” shall have the meaning set forth in Section 3(a).

 

“Certificated Series A Preferred Stock” shall have the meaning set forth in
Section 10(b)(i).

 

“Change of Control” shall mean the occurrence of any of the following:

 

(i)        any acquisition (including, without limitation, any merger,
consolidation or business combination), the result of which is that any Person
or “group” (within the meaning of Section 13(d)(3) of the Exchange Act),
excluding any Person that is an Affiliate of the Company as of the Issue Date
and immediately prior to such acquisition, becomes the beneficial owner,
directly or indirectly, of 50% or more of the Voting Securities of the Company
(measured by voting power rather than number of shares, units or the like) and
such Voting Securities provide such Person or “group” the right to designate
more than 50% of the members of the Board of Directors;

 

(ii)        any sale, lease, transfer, conveyance or other disposition by the
Company or its Subsidiaries, in a single transaction or series of related
transactions, of all or substantially all of the assets of the Company and its
Subsidiaries, taken as a whole, to any other Person (other than a direct or
indirect Subsidiary of the Company);

 

(iii)       (a) any sale, lease, transfer, conveyance or other disposition by
the Partnership or its Subsidiaries, in a single transaction or series of
related transactions, of all or substantially all of the assets of the
Partnership and its Subsidiaries, taken as a whole, to any other Person (other
than a direct or indirect Subsidiary of the Company) or (b) the Company fails to
own, directly or indirectly, all of the equity securities of the Partnership;

 

(iv)       the Common Stock is no longer listed or admitted to trading on a
National Securities Exchange; or

 

2

 

 

(v)       more than half of the members of the Board of Directors, as of any
time of determination, are not Continuing Directors;

 

provided, however, that notwithstanding anything to the contrary contained in
this Certificate of Designations, a Company Restructuring Event shall not
constitute a Change of Control.

 

“close of business” shall mean 5:00 p.m. (New York City time).

 

“Closing Sale Price” of the Common Stock shall mean, as of any date, the closing
sale price per share (or if no closing sale price is reported, the average of
the closing bid and ask prices or, if more than one in either case, the average
of the average closing bid and the average closing ask prices) on such date as
reported on the principal United States securities exchange on which the Common
Stock is traded or, if the Common Stock is not listed on a United States
national or regional securities exchange, in the over-the-counter market as
reported by OTC Markets Group Inc. or a similar organization. In the absence of
such a quotation, the Closing Sale Price shall be an amount determined by the
Board of Directors to be the fair market value of a share of Common Stock. If
the Ex-Date for any distribution, the effective date for any subdivision,
combination or reclassification or the Effective Date of any Pro Rata Repurchase
(as used in this definition, the “Adjustment Date”) that requires (or, but for
the second sentence of Section 6(e)(vii) or Section 6(f)(i), would have
required) an adjustment to the Conversion Rate pursuant to Section 6(e) occurs
on or after the first Trading Day in the 10 Trading Day period used to calculate
“MP0” in the formula in Section 6(e)(vi), the Closing Sale Price for each
Trading Day prior to such Adjustment Date shall be adjusted by multiplying such
Closing Sale Price by the same fraction by which the Conversion Rate is so
required (or would have been required) to be adjusted pursuant to Section
6(e) as a result of such event.

 

“Common Stock” shall mean the common stock, no par value, of the Company.

 

“Company” shall mean Equitrans Midstream Corporation, a corporation organized
and existing under the laws of the Commonwealth of Pennsylvania.

 

“Company Restructuring Event” shall mean any merger, consolidation or other
business combination of the Company with another Person immediately following
which (a) the beneficial owners of Voting Securities of the Company as of
immediately prior to the consummation of such Company Restructuring Event (i)
beneficially own more than 50% of the Voting Securities of the surviving entity
and (ii) have the right to designate (by ownership of Voting Securities) more
than 50% of the surviving entity’s directors, (b) the common equity of such
surviving entity remains listed or admitted to trading on a National Securities
Exchange following such transaction and (c) either (i) the Series A Preferred
Stock remains outstanding at the surviving entity or (ii) each Holder of
Series A Preferred Stock has received a Substantially Equivalent Security of the
surviving entity in respect of each share of its Series A Preferred Stock
beneficially owned.

 

“Continuing Directors” means individuals who, on the Issue Date, constitute the
members of the Board of Directors; provided that any individual becoming a
member of the Board of Directors subsequent to the Issue Date whose election or
nomination for election to the Board of Directors was approved by a vote of at
least a majority of the Continuing Directors then on the Board of Directors
(either by a specific vote or by approval of the proxy statement of the Company
in which such person is named as a nominee for Director without objection to
such nomination) shall be a Continuing Director.

 

“Conversion Date” shall mean the Optional Conversion Date, and the Forced
Conversion Date, as applicable.

 

“Conversion Rate” shall mean the number of shares of Common Stock issuable upon
the conversion of each share of Series A Preferred Stock, which shall be equal
to (a) in all cases other than a Change of Control, the quotient of (i) the sum
of (x) the Liquidation Preference plus (y) Accrued Dividends as of such date
divided by (ii) the Issue Price (as such Conversion Rate may be adjusted as set
forth in Section 6(e)); and (b) in the case of a Change of Control, the greater
of (i) the amount set forth in clause (a) above and (ii) the quotient of (1) the
sum of (A) (x) the Issue Price, multiplied by (y) 110%, plus (B) all Accrued
Dividends on such share of Series A Preferred Stock on such date, divided by (2)
the VWAP of the shares of Common Stock for the 30-day period ending immediately
prior to the execution of definitive documentation relating to the Change of
Control (as such Conversion Rate may be adjusted as set forth in Section 6(e) or
Section 8); provided, however, that for purposes of Section 8(c)(i), the
Conversion Rate shall be the amount determined pursuant to clause (a) above.

 

3

 

 

“Dividend Adjustment Date” shall mean March 31, 2024.

 

“Dividend Payment Date” shall mean the date that is the earlier of (a)
forty-five (45) days after the end of each fiscal quarter of the Company and (b)
the payment date of dividends, if any, on any Parity Stock and Junior Stock. If
the Company establishes an earlier Dividend Record Date for any dividend to be
made by the Company on other capital stock in respect of any fiscal quarter,
then the Dividend Record Date for shares of Series A Preferred Stock shall be
such earlier Dividend Record Date.

 

“Dividend Rate” shall mean, as of the date of the determination, (a) for each
fiscal quarter ending on or before the Dividend Adjustment Date, a rate per
annum of 9.75% and (b) for each fiscal quarter ending after the Dividend
Adjustment Date, a rate per annum equal to the sum of (i) Three-Month LIBOR as
of the LIBOR Determination Date in respect of the applicable quarter and (ii)
8.15%, provided that the Dividend Rate per share of Series A Preferred Stock in
this clause (b) shall not be less than 10.50% per annum. For the avoidance of
doubt, the Dividend Rate set forth in clause (a) and (b) shall each be subject
to any increase pursuant to Section 4(j).

 

“Dividend Record Date” shall mean, with respect to any fiscal quarter and
applicable Dividend Payment Date, the record date (which shall be a Business
Day) set by the Board of Directors for holders eligible to receive any dividend
declared for such fiscal quarter.

 

“Dividend Trigger Event” shall mean the occurrence of a Dividend Payment Date on
which the Company has failed to pay to the Holders the Cash Dividend in respect
of the fiscal quarter corresponding to such Dividend Payment Date for any
reason, regardless of whether such Cash Dividend was declared by the Board of
Directors or whether there were sufficient funds legally available for payment
of such Cash Dividend.

 

“Equity Interests” of any Person shall mean any and all shares, interests,
rights to purchase, warrants, options, participation or other equivalents of or
interests in (however designated) equity of such Person, including any preferred
stock, any limited or general partnership interest, any limited liability
company membership interest and any unlimited liability company membership
interests.

 

“Ex-Date” shall mean, when used with respect to any issuance of or distribution
in respect of the Common Stock or any other securities, the first date on which
the Common Stock or such other securities trade without the right to receive
such issuance or distribution.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.

 

“Forced Conversion Date” shall have the meaning set forth in Section 6(b).

 

“Forced Conversion Notice” shall have the meaning set forth in Section 6(b).

 

“Forced Conversion Notice Date” shall have the meaning set forth in Section
6(b).

 

“Holder” and, unless the context requires otherwise, “holder” shall each mean a
holder of record of a share of Series A Preferred Stock.

 

“Issue Date” shall mean the original date of issuance of the Series A Preferred
Stock, which shall be the date on which this Certificate of Designations becomes
effective with the Secretary of State of the Commonwealth of Pennsylvania.

 

4

 

 

“Issue Price” shall mean $19.99 per share of Series A Preferred Stock.

 

“Junior Stock” shall mean the Company’s common stock, no par value, and each
other series of preferred stock established after the Issue Date, by the Board
of Directors, the terms of which do not expressly provide that the dividend
rights and rights upon the liquidation, winding-up or dissolution of the Company
for such series ranks senior to or on a parity with the Series A Preferred Stock
as to dividend rights or rights upon the liquidation, winding-up or dissolution
of the Company.

 

“Lead Investors” means, collectively, GSO Capital Partners LP, Magnetar
Financial LLC and Blackrock, Inc.

 

“LIBOR Determination Date” shall mean the second London Banking Day prior to the
beginning of the applicable fiscal quarter.

 

“Liquidation Preference” shall mean, with respect to each share of Series A
Preferred Stock, the Issue Price.

 

“Market Value” shall mean the Average VWAP during a 10 consecutive Trading Day
period ending on, and including, the Trading Day immediately prior to the date
of determination. If the Ex-Date for any distribution, the effective date for
any subdivision, combination or reclassification or the Effective Date of any
Pro Rata Repurchase (as used in this definition, “Adjustment Date”) that
requires (or, but for the second sentence of Section 6(e)(vii) or Section
6(f)(i), would have required) an adjustment to the Conversion Rate pursuant to
Section 6(e) occurs on or after the first Trading Day in the 10 Trading Day
period used to calculate Market Value for a date of determination, the VWAP for
each Trading Day prior to such Adjustment Date shall be adjusted by multiplying
such VWAP by the same fraction by which the Conversion Rate is so required (or
would have been required) to be adjusted pursuant to Section 6(e) as a result of
such event.

 

“MOIC Shares” shall have the meaning set forth in Section 8(c)(ii).

 

“MOIC Value” means a value per converted share of Series A Preferred Stock
calculated as follows: (i) the number of MOIC Shares into which such share of
Series A Preferred Stock will be converted, multiplied by (ii) the lesser of
(x) 95% of the VWAP of the Common Stock for the 20-day period immediately
preceding the consummation of such Change of Control and (y) the Closing Sale
Price of one share of Common Stock on the Trading Day immediately preceding the
date of the consummation of such Change of Control.

 

“National Securities Exchange” shall mean an exchange registered with the SEC
under Section 6(a) of the Exchange Act.

 

“Notice of Issuance” shall have the meaning set forth in Section 4(e).

 

“Officer” shall mean the Chief Executive Officer, the President, the Chief
Financial Officer, any Executive Vice President, any Senior Vice President, any
Vice President, the Treasurer, the Corporate Secretary or any Assistant
Corporate Secretary of the Company.

 

“opening of business” shall mean 9:00 a.m. (New York City time).

 

“Optional Conversion Date” shall have the meaning set forth in Section 6(a).

 

“Optional Conversion Notice” shall have the meaning set forth in Section 6(a).

 

“Optional Conversion Notice Date” shall have the meaning set forth in Section
6(a).

 

“Optional Redemption Date” shall have the meaning set forth in Section 7(a).

 

“Optional Redemption Notice” shall have the meaning set forth in Section 7(c).

 

5

 

 

“Optional Redemption Price” shall have the meaning set forth in Section 7(b).

 

“Ownership Notice” shall mean a written notice containing the information
required to be provided to registered owners of capital stock of the Company
within a reasonable time after the issuance or transfer of uncertificated
shares, which notice contains the information required to be set forth or stated
on certificates pursuant to Section 1528 of the Pennsylvania BCL and, in the
case of an issuance of shares of Series A Preferred Stock by the Company, in
substantially the form attached hereto as Exhibit B.

 

“Parity Stock” shall mean any series of preferred stock established after the
Issue Date by the Board of Directors in accordance with the Articles of
Incorporation, the terms of which expressly provide that the dividend rights and
rights upon the liquidation, winding-up or dissolution of the Company for such
series will rank on a parity with the Series A Preferred Stock as to dividend
rights or rights upon the liquidation, winding-up or dissolution of the Company.

 

“Partial Period Dividends” shall mean, with respect to a conversion, redemption
or liquidation of a share of Series A Preferred Stock, an amount equal to the
(a)(i) Issue Price multiplied by (ii) the Dividend Rate multiplied by (b) a
fraction, the numerator of which is the number of days elapsed in the fiscal
quarter in which such conversion, redemption or liquidation occurs and the
denominator of which is the total number of days in such fiscal quarter.

 

“Partnership” shall mean EQM Midstream Partners, LP, a Delaware limited
partnership.

 

“Paying Agent” shall mean the Transfer Agent, acting in its capacity as paying
agent for the Series A Preferred Stock, and its successors and assigns, or any
other Person appointed to serve as paying agent by the Company.

 

“Pennsylvania BCL” shall have the meaning set forth in the recitals.

 

“Permitted Loan” shall mean any bona fide loans or other extensions of credit
entered into by a Holder or any of its respective Affiliates with one or more
financial institutions and secured by a pledge, hypothecation or other grant of
security interest in shares of Series A Preferred Stock and/or related assets
and/or cash, cash equivalents and/or letters of credit.

 

“Person” shall mean any individual, corporation, general partnership, limited
partnership, limited liability partnership, joint venture, association,
joint-stock company, trust, limited liability company, unincorporated
organization or government or any agency or political subdivision thereof.

 

“Preemptive Rights Holder” shall have the meaning set forth in Section 4(e).

 

“Pro Rata” shall mean, (a) when used with respect to the Series A Preferred
Stock, apportioned among all Holders in accordance with the relative number or
percentage of shares of Series A Preferred Stock held by each such Holder and
(b) when used with respect to the Common Stock and the Series A Preferred Stock
on an as-converted basis, apportioned among all holders of record in accordance
with the relative number of shares of Common Stock that would be held by each if
the shares of Series A Preferred Stock were converted to shares of Common Stock
at the then-applicable Conversion Rate immediately prior to such determination.

 

“Pro Rata Repurchases” shall mean any purchase of shares of Common Stock by the
Company or any Affiliate thereof pursuant to (a) any tender offer or exchange
offer directed to all of the holders of Common Stock subject to Section 13(e) or
14(e) of the Exchange Act or Regulation 14E promulgated thereunder or (b) any
other tender offer available to substantially all holders of Common Stock, in
the case of both (a) and (b), whether for cash, shares of capital stock of the
Company, other securities of the Company, evidences of indebtedness of the
Company or any other Person or any other property (including shares of capital
stock, other securities or evidences of indebtedness of a Subsidiary), or any
combination thereof, effected while the Series A Preferred Stock is outstanding.
The “Effective Date” of a Pro Rata Repurchase shall mean the date of a purchase
with respect to any Pro Rata Repurchase.

 

6

 

 

“Restructuring Agreement” shall mean that certain Preferred Restructuring
Agreement, dated as of February 26, 2020, by and among the Company, EQM
Midstream Partners, LP, and the investors party thereto.

 

“SEC” shall mean the Securities and Exchange Commission.

 

“Securities Act” shall mean the Securities Act of 1933, as amended.

 

“Senior Stock” shall mean each series of preferred stock established after the
Issue Date by the Board of Directors, the terms of which expressly provide that
the dividend rights and rights upon the liquidation, winding-up or dissolution
of the Company for such series will rank senior to the Series A Preferred Stock
as to dividend rights or rights upon the liquidation, winding-up or dissolution
of the Company.

 

“Shelf Registration Statement” shall mean a shelf registration statement filed
with the SEC covering resales of Transfer Restricted Securities by holders
thereof.

 

“Subsidiary” shall mean, 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 or more than 50% of the general partner interest 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.

 

“Substantially Equivalent Security” shall have the meaning set forth in Section
8(c)(ii).

 

“Three-Month LIBOR” shall mean, as of any LIBOR Determination Date, the London
interbank offered rate (expressed as a percentage per year) for deposits in U.S.
dollars having an index maturity of three-months in amounts of at least
$1,000,000, as that rate appears on Reuters Page LIBOR01 (or any successor or
replacement page) at 11:00 a.m. (London time) on such LIBOR Determination Date.
Notwithstanding the foregoing, if (a) the Board of Directors determines in good
faith that Three-Month LIBOR has been discontinued, and such discontinuance is
unlikely to be temporary, or that Three-Month LIBOR is no longer being
published, or (b) the supervisor for the administrator of the London Interbank
Offered Rate has made a public statement identifying a specific date after which
the London Interbank Offered Rate shall no longer be used for determining
interest rates for loans, then the holders of a majority of the shares of Series
A Preferred Stock and the Board of Directors will negotiate in good faith to (i)
designate a substitute or successor reference rate, including any spread with
respect thereto, taking into account general comparability to Three-Month LIBOR,
acceptance as a market-based benchmark interest rate and any other commercially
reasonable adjustments or factors as such holders and the Board of Directors
deem appropriate (the “Alternative Rate”), and (ii) determine any necessary
changes to the LIBOR Determination Date to be used and any other relevant
methodology for calculating the substitute or successor interest rate, including
any adjustment factor needed to make such substitute or successor reference rate
comparable to Three-Month LIBOR (“Adjustments”), in a manner that is consistent
with industry accepted practices for such substitute or successor reference
rate. Any such designation and determination agreed to by the holders of a
majority of the shares of Series A Preferred Stock and the Board of Directors
shall be final and conclusive absent manifest error, and the Board of Directors
shall cause this Certificate of Designations to be amended as necessary to
effectuate the substitute or successor reference rate. Notwithstanding the
foregoing, if the Board of Directors and the holders of a majority of the shares
of Series A Preferred Stock fail to determine in good faith an Alternative Rate
and any Adjustments, the holders of a majority of the shares of Series A
Preferred Stock and the Board of Directors shall select and mutually engage in
good faith an independent financial advisor (“IFA”) to determine the Alternative
Rate and any Adjustments, and the decision of the IFA will be binding on the
Board of Directors, the Company and the Holders. For any such designation and
determination by the IFA of an Alternative Rate and any Adjustments, the Board
of Directors shall cause this Certificate of Designations to be amended as
necessary to effectuate the substitute or successor reference rate. If the
holders of a majority of the shares of Series A Preferred Stock and the Board of
Directors are unable to agree upon an independent financial advisor to serve as
the IFA within ten (10) Business Days after either sends written notice to the
other requesting that the IFA be engaged pursuant to the preceding sentence,
then each will select one independent financial advisor of established national
reputation and such two independent financial advisors shall select a third
independent financial advisor of established national reputation to serve as the
IFA. From the earlier of (A) the date that Three-Month LIBOR has been
discontinued or is no longer being published as described in clause (a) above
and (B) the specific date referred to in clause (b) above (such earlier date,
the “LIBOR Discontinuance Date”) until the holders of the Series A Preferred
Stock and the Board of Directors make such designation and determination (and,
in each case, an IFA has not determined an appropriate Alternative Rate and
Adjustments or an IFA has not been appointed), “Three-Month LIBOR” shall be
deemed to mean the rate that was the Three Month LIBOR in effect during the
fiscal quarter immediately preceding the LIBOR Discontinuance Date.

 

7

 

 

“Trading Day” shall mean a day during which trading in securities generally
occurs on the New York Stock Exchange or, if the Common Stock is not listed on
the New York Stock Exchange, on the principal other national or regional
securities exchange on which the Common Stock is then listed or, if the Common
Stock is not listed on a national or regional securities exchange, on the
principal other market on which the Common Stock is then traded. If the Common
Stock is not so listed or traded, “Trading Day” shall mean a Business Day.

 

“Transfer Agent” shall mean American Stock Transfer & Trust Company, LLC, acting
as the Company’s duly appointed transfer agent, registrar, conversion agent and
dividend disbursing agent for the Series A Preferred Stock, and its successors
and assigns, or any other person appointed to serve as transfer agent,
registrar, conversion agent and dividend disbursing agent by the Company;
provided that, if at any time no such Person is appointed as transfer agent,
registrar, conversion agent and dividend disbursing agent for the Series A
Preferred Stock, the Company shall act as the Transfer Agent.

 

“Transfer Restricted Securities” shall mean each share of Common Stock received
upon conversion of a share of Series A Preferred Stock until (a) such shares of
Common Stock shall be freely tradable pursuant to an exemption from registration
under the Securities Act under Rule 144 thereunder, or (b) the resale of such
shares of Common Stock has been registered under the Securities Act under an
effective Shelf Registration Statement, in each case unless otherwise agreed to
by the Company and the Holder thereof.

 

“Trigger Event” shall have the meaning set forth in Section 6(e)(ix).

 

“Voting Securities” means, with respect to a specified Person as of any date of
determination, the capital stock and preferred stock of such Person that is at
such date entitled to vote in the election of the managers, directors, trustees
or other Persons serving in a similar capacity with respect to such Person.

 

“VWAP” per share of Common Stock on any Trading Day shall mean the per share
volume-weighted average price as displayed on Bloomberg page “ETRN: US” (or its
equivalent successor if such page is not available) in respect of the period
from 9:30 a.m. to 4:00 p.m., New York City time, on such Trading Day; or, if
such price is not available, “VWAP” shall mean the market value per share of
Common Stock on such Trading Day as determined, using a volume-weighted average
method, by a nationally recognized independent investment banking firm retained
by the Company for this purpose.

 

Section 3               Dividends.

 

(a)           Holders shall be entitled to receive, with respect to each share
of Series A Preferred Stock, prior to any distributions made in respect of any
Junior Stock in respect of the same fiscal quarter, out of funds legally
available for the payment of dividends under Pennsylvania law, cash dividends
(“Cash Dividends”) on the Issue Price, computed on the basis of a 365-day year,
at the Dividend Rate, compounded quarterly and payable on each Dividend Payment
Date. To the extent the Board of Directors so declares, Cash Dividends shall be
payable in arrears on each Dividend Payment Date for the immediately preceding
fiscal quarter ending prior to such Dividend Payment Date (or with respect to
the first Dividend Payment Date, for the period commencing on the Issue Date and
ending on the last day of the fiscal quarter following the Issue Date), to the
Holders as they appear on the Company’s stock register at the close of business
on the relevant Dividend Record Date. Subject to Section 3(c), dividends on the
Series A Preferred Stock shall not be declared, paid or set aside for payment to
the extent such act would cause the Company to fail to comply with the laws and
regulations applicable to the Company. Dividends on the Series A Preferred Stock
shall accumulate and become Accrued Dividends on a day-to-day basis, whether or
not declared, from the last day of the most recent fiscal quarter (or with
respect to the fiscal quarter in which the Issue Date occurs, from the Issue
Date) until Cash Dividends are paid pursuant to this Section 3(a) or Section
3(c) in respect of such accumulated amounts. Notwithstanding anything to the
contrary herein, with respect to the first Dividend Payment Date following the
Issue Date, in addition to the Cash Dividend which has accrued for the period
commencing on the Issue Date and ending on the last day of the fiscal quarter
following the Issue Date in accordance with this Section 3(a), each Holder shall
be entitled to receive as part of the Cash Dividend payable to such Holder on
such Dividend Payment Date an amount in cash equal to $[●]1 with respect to each
share of Series A Preferred Stock held by such Holder.

 

8

 

 

(b)           Notwithstanding anything to the contrary herein, upon any
conversion of any shares of Series A Preferred Stock in accordance with this
Certificate of Designations, the Accrued Dividends with respect to such shares
of Series A Preferred Stock, at the Company’s option, shall either (i) be paid
in cash on or prior to the date of such conversion or (ii) not be paid in cash
and instead be treated in accordance with the provisions of this Certificate of
Designations pursuant to which such shares of Series A Preferred Stock were
converted. The Holders at the close of business on a Dividend Record Date shall
be entitled to receive any dividend paid as a Cash Dividend on those shares on
the corresponding Dividend Payment Date.

 

(c)           Notwithstanding anything to the contrary herein, if the Company
fails to pay in full in cash to the Holders a Cash Dividend on the Dividend
Payment Date for a fiscal quarter for any reason (whether or not declared and
whether or not there were sufficient funds legally available for payment under
Pennsylvania law or otherwise), then (i) the amount of such shortfall will
continue to be owed by the Company to the Holders and will accumulate and accrue
(and shall remain Accrued Dividends) until paid in full in cash and (ii) to the
extent provided for in this Certificate of Designations, each Holder shall have
all rights under this Certificate of Designations as a result of such
nonpayment, including in accordance with Section 3 and Section 4, together with
any other rights which such Holder is entitled to under any contract or
agreement at any time and any other rights that such Holder may have pursuant to
applicable law. Any such accumulated and unpaid dividends on shares of Series A
Preferred Stock for any past dividend periods may be declared and paid at any
time to Holders.

 

(d)           So long as any share of the Series A Preferred Stock remains
outstanding, no dividend or distribution shall be declared or paid on, and no
redemption or repurchase shall be agreed to or consummated of, Parity Stock,
Common Stock or any other shares of Junior Stock, unless all accumulated and
unpaid dividends on the shares of Series A Preferred Stock for all preceding
full fiscal quarters (including the fiscal quarter in which such accumulated and
unpaid dividends first arose) of the Company have been declared and paid in cash
in full (including any Accrued Dividends); provided, however, that the foregoing
limitation shall not apply to (i) a dividend payable on Common Stock or other
Junior Stock in shares of Common Stock or other Junior Stock, (ii) the
acquisition of shares of Common Stock or other Junior Stock in exchange for
shares of Common Stock or other Junior Stock and the payment of cash in lieu of
fractional shares of Common Stock or other Junior Stock; (iii) purchases of
fractional interests in shares of Common Stock or other Junior Stock pursuant to
the conversion or exchange provisions of shares of other Junior Stock or any
securities exchangeable for or convertible into such shares of Common Stock or
other Junior Stock; (iv) redemptions, purchases or other acquisitions of shares
of Common Stock or other Junior Stock in connection with the administration of
any employee benefit plan in the ordinary course of business, including, without
limitation, the forfeiture of unvested shares of restricted stock or share
withholdings upon exercise, delivery or vesting of equity awards granted to
officers, directors and employees and the payment of cash in lieu of fractional
shares of Common Stock or other Junior Stock; (v) any dividends or distributions
of rights in connection with a shareholders’ rights plan or any redemption or
repurchase of rights pursuant to any shareholders’ rights plan; and (vi) the
exchange or conversion of Junior Stock for or into other Junior Stock and the
payment of cash in lieu of fractional shares of other Junior Stock.
Notwithstanding the preceding, if full dividends have not been paid on the
Series A Preferred Stock and any Parity Stock, dividends may be declared and
paid on the Series A Preferred Stock and such Parity Stock so long as the
dividends are declared and paid Pro Rata so that amounts of dividends declared
per share on the Series A Preferred Stock and such Parity Stock shall in all
cases bear to each other the same ratio that accumulated and unpaid dividends
per share on the shares of Series A Preferred Stock and such other Parity Stock
bear to each other.

 

 

1Note to Draft: To represent amount of accrued and unpaid Series A Preferred
Distributions (including Series A Partial Period Distributions) as of the Issue
Date on each Series A Preferred Unit.

 

9

 

 

(e)           Subject to Section 4(d), each share of Series A Preferred Stock
will have the right to share in any special or non-recurring dividends by the
Company of cash, securities or other property Pro Rata with the Common Stock or
any other Junior Stock, on an as-converted basis, provided that special
dividends shall not include regular quarterly dividends paid in the normal
course of business on the Common Stock. No adjustments pursuant to Section 6(e)
shall be made with respect to a special dividend in which the shares Series A
Preferred Stock participate Pro Rata with the shares of Common Stock, on an
as-converted basis, pursuant to this Section 3(e) and subject to Section 4(d).

 

Section 4               Special Rights.

 

(a)           Holders shall be entitled to vote on all matters on which the
holders of shares of Common Stock are entitled to vote and, except as otherwise
provided herein, in the Articles of Incorporation (including, in any other
certificate of designations), or by law, the Holders shall vote together with
the holders of shares of Common Stock as a single class. As of any record date
or other determination date, each Holder shall be entitled to a number of votes
equal to the number of votes such Holder would have had if all shares of Series
A Preferred Stock held by such Holder on such date had been converted into
shares of Common Stock immediately prior thereto; provided, however, that shares
of Series A Preferred Stock that are held by any Affiliates of the Company shall
not be considered outstanding or be entitled to vote on any matter on which the
shares of Series A Preferred Stock are entitled to vote (whether voting as a
separate class or on an as converted basis with the shares of Common Stock).

 

(b)           Except as provided in Section 4(c) and Section 4(d), so long as
any shares of Series A Preferred Stock are outstanding, in addition to any other
vote or consent of shareholders required by the Pennsylvania BCL or the Articles
of Incorporation, the affirmative vote or consent of the holders of at least 66
2/3% of the outstanding shares of Series A Preferred Stock, voting together as a
separate class, given in person or by proxy, either in writing without a meeting
or by vote at any meeting called for the purpose, shall be necessary for
effecting or validating an amendment to this Certificate of Designations or to
the Articles of Incorporation (including by merger or otherwise), that is
adverse (other than in a de minimis manner) to any of the rights, preferences
and privileges of the shares of Series A Preferred Stock. Without limiting the
generality of the preceding sentence, any amendment shall be deemed to have such
an adverse impact that is not de minimis if such amendment would:

 

(i)             reduce the Dividend Rate, change the form of payment of
dividends on the shares of Series A Preferred Stock, defer the date from which
distributions on the shares of Series A Preferred Stock will accrue, cancel any
accrued and unpaid distributions on the shares of Series A Preferred Stock or
any interest accrued thereon (including any Accrued Dividends), or change the
seniority rights of the Holders as to the payment of distributions in relation
to the holders of any other class or series of capital stock;

 

(ii)            reduce the amount payable or change the form of payment to the
Holders upon the voluntary or involuntary liquidation, dissolution or winding
up, or sale of all or substantially all of the assets, of the Company, or change
the seniority of the liquidation preferences of the Holders in relation to the
rights of the holders of any other class or series of capital stock of the
Company upon the liquidation, dissolution and winding up of the Company; or

 

(iii)           make the shares of Series A Preferred Stock redeemable or
convertible at the option of the Company other than as set forth herein.

 

Notwithstanding the foregoing, neither a Change of Control of the Company
undertaken in compliance with Section 8 nor a Company Restructuring Event shall
be restricted or limited by or require any approval of the Holders pursuant to
Section 4(b) solely by reason of such transaction (provided that, for the
avoidance of doubt, the foregoing shall not entitle the Company to take any
action described in clauses (i)-(iii) above in connection with such
transaction). Notwithstanding anything to the contrary herein, with respect to
effecting or validating an amendment to this Certificate of Designations or the
Articles of Incorporation (including by merger or otherwise) that adversely
affects (other than in a de minimis manner) any of the rights, preferences, and
privileges of a holder of Series A Preferred Stock in a disproportionate manner
relative to any other holder of Series A Preferred Stock, the affirmative vote
or consent of such affected holder, given in person or by proxy, either in
writing without a meeting or by vote at any meeting called for the purpose,
shall be necessary therefor.

 

10

 

 

Notwithstanding the foregoing, any determination of an Alternative Rate and any
Adjustments related to Three-Month LIBOR that are (i) agreed to by the holders
of a majority of the shares of Series A Preferred Stock and the Board of
Directors, or (ii) made by the IFA, each pursuant to the terms of this
Certificate of Designations, shall not require any approval of Holders pursuant
to Section 4(b). Additionally, the Holders agree that any such determinations of
an Alternative Rate and any Adjustments do not represent an adverse change under
Section 1914(b) of the Pennsylvania BCL.

 

(c)            Notwithstanding anything to the contrary herein, without the
consent of the Holders, the Company, acting in good faith, may amend, alter,
supplement or repeal any terms of the Series A Preferred Stock by amending or
supplementing the Articles of Incorporation, this Certificate of Designations or
any stock certificate representing shares of the Series A Preferred Stock:

 

(i)             to cure any ambiguity, omission, inconsistency or mistake in any
such instrument in a manner that is not inconsistent with the provisions of this
Certificate of Designations and that does not adversely affect the rights,
preferences, privileges or voting powers of the Series A Preferred Stock or any
Holder;

 

(ii)           to make any provision with respect to matters or questions
relating to the Series A Preferred Stock that is not inconsistent with the
provisions of this Certificate of Designations and that does not adversely
affect the rights, preferences, privileges or voting powers of the Series A
Preferred Stock or any Holder; or

 

(iii)           to make any other change that does not adversely affect the
rights, preferences, privileges or voting powers of the Series A Preferred Stock
or any Holder (other than any Holder that consents to such change).

 

(d)            So long as any shares of Series A Preferred Stock are
outstanding, in addition to any other vote or consent of shareholders required
by the Pennsylvania BCL or the Articles of Incorporation, the affirmative vote
or consent of the holders of at least 66 2/3% of the outstanding shares of
Series A Preferred Stock, voting together as a separate class, given in person
or by proxy, either in writing without a meeting or by vote at any meeting
called for the purpose, shall be necessary for the Company to issue any (A)
Senior Stock (or amend the provisions of any class of Equity Interests to make
such class of Equity Interests a class of Senior Stock), (B) Parity Stock (or
amend the provisions of any class of Equity Interests to make such class of
Equity Interests a class of Parity Stock) or (C) Series A Preferred Stock;
provided, however, that, without the consent of any holder of outstanding shares
of Series A Preferred Stock (but without prejudice to their rights to vote on an
as-converted basis to the extent that the shares of Common Stock are entitled to
vote on any such matter), at any time on or following the Issue Date, the
Company may issue a number of additional shares of Parity Stock (which may be in
the form of additional shares of Series A Preferred Stock) with an aggregate
purchase price of up to $100,000,000 across all such issuances; provided,
further, that the Company may, without any vote of the Holders (but without
prejudice to such Holders’ rights to vote on an as-converted basis to the extent
the shares of Common Stock are entitled to vote on any such matter), create (by
classification or otherwise) and issue shares of Junior Stock in an unlimited
amount.

 

(e)            Notwithstanding anything to the contrary herein, the affirmative
vote or consent of the holders of at least 66 2/3% of the outstanding shares of
Series A Preferred Stock, voting together as a separate class, given in person
or by proxy, either in writing without a meeting or by vote at any meeting
called for the purpose, shall be necessary to approve any special or
non-recurring dividend.

 

(f)             So long as a Holder or its Affiliates collectively own at least
50% or more of the shares of Series A Preferred Stock issued to such Holder or
its Affiliates on the Issue Date (excluding shares of Common Stock into which
such shares of Series A Preferred Stock have been converted) pursuant to the
Restructuring Agreement (the “Preemptive Rights Holder”), prior to the issuance
of Parity Stock, the Company shall, by written notice to the Preemptive Rights
Holders (the “Notice of Issuance”), if any, offer to sell such Parity Stock to
the Preemptive Rights Holders on terms and subject to conditions determined by
the Board of Directors to be reasonable, which offer shall be made on a Pro Rata
basis such that each Preemptive Rights Holder shall be entitled to purchase a
portion of such Parity Stock equal to the quotient of (i) the number of shares
of Series A Preferred Stock held by such Preemptive Rights Holder on the date of
the Notice of Issuance divided by (ii) the aggregate number of shares of Series
A Preferred Stock held by all Preemptive Rights Holders on the date of the
Notice of Issuance; provided, that the offer of such Parity Stock shall not be
on a basis less favorable to the Preemptive Rights Holders than is offered to
any purchaser thereof who is not a Preemptive Rights Holder; provided, further
that if any Preemptive Rights Holder fails to provide written notice of its
intent to exercise its right to purchase Parity Stock within ten (10) Business
Days of the Notice of Issuance, such Preemptive Rights Holder shall be deemed to
have waived any and all rights to purchase such Parity Stock in such
transaction. Notwithstanding the foregoing, in no event shall the Company be
obligated to offer to sell Parity Stock to the Preemptive Rights Holders
pursuant to this Section 4(f) in connection with any securities issued to the
owners of another entity in connection with the acquisition of such entity by
the Company or any Subsidiary of the Company by merger, consolidation, sale or
exchange of securities, purchase of substantially all of the assets, or other
reorganization whereby the Company directly or indirectly acquires more than 50%
of the voting power or assets of such entity.

 

11

 

 

(g)            Prior to the close of business on the applicable Conversion Date,
the shares of Common Stock issuable upon conversion of the Series A Preferred
Stock shall not be deemed to be outstanding and Holders shall have no voting
rights with respect to such shares of Common Stock solely by virtue of holding
the Series A Preferred Stock.

 

(h)            In exercising the voting rights set forth in Sections 4(a), 4(b),
4(d) and 4(e), each share of Series A Preferred Stock shall be entitled to one
vote.

 

(i)             The rules and procedures for calling and conducting any meeting
of the Holders (including the fixing of a record date in connection therewith),
the solicitation and use of proxies at such a meeting, the obtaining of written
consents and any other procedural aspect or matter with regard to such a meeting
or such consents shall be governed by the Articles of Incorporation, the Amended
and Restated Bylaws and the Pennsylvania BCL.

 

(j)             If a Dividend Trigger Event occurs, then for so long as any
Dividend Trigger Event remains outstanding, the then-applicable Dividend Rate
will increase by 2.00% per annum until such time as all the accrued but unpaid
Cash Dividends on the Series A Preferred Stock for the most recently completed
fiscal quarter and all previously completed fiscal quarters are paid in full in
cash. Upon the date that all unpaid Cash Dividends giving rise to all
outstanding Dividend Trigger Events have been fully paid and are current (the
“Cash Dividend Catch-Up”), the applicable Dividend Rate as set forth herein in
the definition of “Dividend Rate” will once again apply from and after such
date, unless and until a Dividend Trigger Event thereafter occurs and the
Dividend Rate is once again increased in accordance with the terms of this
Section 4(j).

 

(k)            Upon the occurrence of a Dividend Trigger Event that represents
the fourth (4th) Dividend Trigger Event to occur while any Series A Preferred
Stock remains outstanding (whether or not consecutive) and upon the occurrence
of each Dividend Trigger Event thereafter, and lasting until such time as the
Cash Dividend Catch-Up occurs with respect to all accrued and unpaid Cash
Dividends or until the time there are no shares of Series A Preferred Stock
outstanding, the Holders of a majority of the shares of outstanding Series A
Preferred Stock (which shall include (i) Holders that are Affiliates of at least
two of the Lead Investors if Affiliates of at least two of the Lead Investors
are Holders as of such time and (ii) Holders that are Affiliates of the
remaining Lead Investor if Affiliates of only one of the Lead Investors are
Holders as of such time) shall be entitled to designate one natural person to
attend all meetings of the Board of Directors or committees thereof (the “Board
Observer”), in addition to the remedies set forth in Section 4(j). For as long
as the Holders are entitled to designate a Board Observer, the Board Observer
shall be entitled to attend all meetings (including telephonic meetings) of the
Board of Directors and any committees thereof. The Company shall provide to the
Board Observer any notices delivered to the members of the Board of Directors
and a copy of all meeting materials concurrently with providing such notices and
materials to the Board of Directors. The Board Observer shall not be a member of
the Board of Directors and shall not have any voting rights with respect to any
action brought before the Board of Directors or any committee thereof or count
towards any quorum with respect to such actions. Notwithstanding any rights to
be granted or provided to the Board Observer hereunder, the Board of Directors
may exclude any Board Observer from access to any materials or meeting or
portion thereof if the Board of Directors determines, in good faith, that (A)
access would reasonably be expected to prevent the members of the Board of
Directors or committee thereof from engaging in attorney-client privileged
communication or result in a bona fide conflict of interest with the Company
involving any arrangement or transaction (or potential arrangement or
transaction) between the Company or its Subsidiaries, on the one hand, and
Holders or any of their Affiliates, on the other hand (other than any redemption
of or other transaction pertaining to the Series A Preferred Stock); provided
that no such conflict shall be deemed to exist merely by virtue of the Holders
or their Affiliates holding Series A Preferred Stock (provided, however, that
such exclusion shall be limited to the portion of the material and/or meeting
that is the basis for such exclusion and shall not extend to any portion of the
material and/or meeting that does not involve or pertain to such exclusion) or
(B) such portion of a meeting is an executive session limited solely to
independent director members of the Board of Directors, independent auditors
and/or legal counsel, as the Board of Directors may designate, and the Board
Observer (assuming such Board Observer were a member of the Board of Directors)
would not meet the then-applicable standards for independence adopted by New
York Stock Exchange, or such other exchange on which the Company’s securities
are then traded.

 

12

 

 

Section 5               Liquidation Rights.

 

(a)            In the event of any liquidation, winding-up or dissolution of the
Company, whether voluntary or involuntary, each Holder shall be entitled to
receive, in respect of such shares of Series A Preferred Stock, and to be paid
out of the assets of the Company available for distribution to its shareholders,
an amount equal to the greater of (i) the sum of (x) the Liquidation Preference
plus (y) Accrued Dividends thereon and (ii) the amount such Holder would have
received had such Holder, immediately prior to the commencement of such
liquidation, winding-up or dissolution of the Company, converted each share of
Series A Preferred Stock then held by such Holder into shares of Common Stock
pursuant to Section 6(a) using the then-applicable Conversion Rate, in
preference to the holders of, and before any payment or distribution is made on,
any Junior Stock.

 

(b)            Neither the sale, conveyance, exchange or transfer (for cash,
shares of stock, securities or other consideration) of all or substantially all
the assets or business of the Company (other than in connection with the
liquidation, winding up or dissolution of its business), nor the merger or
consolidation of the Company into or with any other Person shall be deemed to be
a liquidation, winding-up or dissolution, voluntary or involuntary, for the
purposes of this Section 5.

 

(c)            After the payment in full to the Holders of the amounts provided
for in this Section 5, the Holders as such shall have no right or claim to any
of the remaining assets of the Company in respect of their ownership of such
Series A Preferred Stock.

 

(d)            In the event the assets of the Company available for distribution
to the Holders upon any liquidation, winding-up or dissolution of the Company,
whether voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such Holders are entitled pursuant to Section 5(a), no such
distribution shall be made on account of any shares of Parity Stock upon such
liquidation, dissolution or winding-up unless proportionate distributable
amounts shall be paid on account of the shares of Series A Preferred Stock,
equally and ratably, in proportion to the full distributable amounts for which
Holders of all Series A Preferred Stock and of any Parity Stock are entitled
upon such liquidation, winding-up or dissolution.

 

Section 6               Conversion.

 

(a)             Beginning with the earlier of (i) April 10, 2021 and (ii)
immediately prior to a liquidation of the Company, each Holder shall have the
right to convert its shares of Series A Preferred Stock, in whole or in part, at
any time and from time to time upon the request of such Holder, into that number
of whole shares of Common Stock equal to the number of shares of Series A
Preferred Stock to be converted multiplied by the Conversion Rate at such time;
provided, however, that in no event shall the Company be obligated to honor such
conversion request unless such conversion will involve an aggregate number of
shares of Series A Preferred Stock with an underlying value of Common Stock
equal to or greater than $20 million, taking into account and including any
concurrent conversion requests by any Affiliates of such Holder, based on the
Closing Sale Price on the Trading Day immediately preceding the Optional
Conversion Notice Date (or a lesser underlying value if such conversion (i) will
result in the conversion of all of the shares of Series A Preferred Stock held
by such Holder or (ii) has been approved by the Board of Directors); provided,
further, that each Holder and such Holder’s Affiliates shall together be
entitled to a single conversion right per fiscal quarter. Notwithstanding
anything to the contrary in this Section 6(a), if any lender, other creditor or
counterparty under any Permitted Loan transaction (including any agent or
trustee on their behalf) or any Affiliate of the foregoing exercises any rights
or remedies under such Permitted Loan on foreclosure or other exercise of
remedies or rights in respect of any pledged shares of Series A Preferred Stock,
then such pledged shares of Series A Preferred Stock may be immediately
converted by such lender, creditor or counterparty into shares of Common Stock.
To convert shares of Series A Preferred Stock into shares of Common Stock
pursuant to this Section 6(a), such Holder shall give written notice (the
“Optional Conversion Notice” and the date of such notice, the “Optional
Conversion Notice Date”) to the Secretary of the Company stating that such
Holder elects to so convert shares of Series A Preferred Stock and shall state
therein: (A) the number of shares of Series A Preferred Stock to be converted
and (B) the name or names in which such Holder wishes the shares of Common Stock
to be issued. If a Holder validly delivers an Optional Conversion Notice in
accordance with this Section 6(a), the Company shall direct the Transfer Agent
to issue the shares of Common Stock no later than two (2) Business Days
thereafter (the date of issuance of such shares, the “Optional Conversion
Date”).

 

13

 

 

(b)            At any time after April 10, 2021, if the Holders have not elected
to convert all of their shares of Series A Preferred Stock pursuant to Section
6(a), the Company shall have the right to cause the outstanding shares of Series
A Preferred Stock to be converted, in whole and not in part into that number of
whole shares of Common Stock equal to the number of shares of Series A Preferred
Stock to be converted multiplied by the Conversion Rate at such time; provided,
however, that in order for the Company to exercise such right, (i) the shares of
Common Stock must be listed or admitted for trading on a National Securities
Exchange, (ii) the Closing Sale Price of the Common Stock must exceed $27.99 for
the twenty (20) consecutive Trading Days immediately preceding the Forced
Conversion Notice Date, (iii) the average daily trading volume of the shares of
Common Stock on the principal National Securities Exchange on which the shares
of Common Stock are then listed or admitted to trading must exceed 1,000,000
shares of Common Stock (as such amount may be adjusted to reflect any Common
Stock split, combination or similar event) for the twenty (20) consecutive
Trading Days immediately preceding the Forced Conversion Notice Date, (iv) the
Company must have an effective registration statement on file with the SEC
covering resales of the underlying shares of Common Stock to be received by the
applicable Holder upon any such conversion and (v) all prior accumulated and
unpaid dividends (including, for the avoidance of doubt, Accrued Dividends) have
been paid in cash in full. To convert shares of Series A Preferred Stock into
shares of Common Stock pursuant to this Section 6(b), the Company shall give
written notice (the “Forced Conversion Notice” and the date of such notice, the
“Forced Conversion Notice Date”) to each Holder stating that the Company elects
to force conversion of such shares of Series A Preferred Stock pursuant to this
Section 6(b) and shall state therein (A) the Company elects to so convert shares
of Series A Preferred Stock pursuant to this Section 6(b) and (B) the number of
shares of Series A Preferred Stock to be converted. If the Company validly
delivers a Forced Conversion Notice in accordance with this Section 6(b), the
Company shall issue the shares of Common Stock no later than five (5) Business
Days thereafter (the date of issuance of such shares, the “Forced Conversion
Date”).

 

(c)            Upon conversion, each Holder shall provide the Transfer Agent a
written instrument or instruments of transfer in form reasonably satisfactory to
the Transfer Agent duly executed by the Holder or its duly authorized legal
representative and (ii) transfer tax stamps or funds therefor, if required
pursuant to Section 6(i).

 

(d)            Immediately prior to the close of business on the Optional
Conversion Date or the Forced Conversion Date, as applicable, with respect to a
conversion, a Holder shall be deemed to be the holder of record of Common Stock
issuable upon conversion of such Holder’s shares of Series A Preferred Stock
notwithstanding that the share register of the Company shall then be closed or
that certificates representing such Common Stock shall not then be actually
delivered to such Holder. Except to the extent that a Holder is not able to
convert its shares of Series A Preferred Stock into Common Stock as a result of
the Company not having sufficient authorized capital under its Articles of
Incorporation, on the Optional Conversion Date or the Forced Conversion Date, as
applicable, dividends shall cease to accrue on the shares of Series A Preferred
Stock so converted and all other rights with respect to the shares of Series A
Preferred Stock so converted, including the rights, if any, to receive notices,
will terminate, except only the rights of Holders thereof to receive the number
of whole shares of Common Stock into which such shares of Series A Preferred
Stock have been converted. As promptly as practical after the conversion of any
shares of Series A Preferred Stock into shares of Common Stock, the Transfer
Agent shall deliver to the applicable Holder an Ownership Notice identifying the
number of full shares of Common Stock to which such Holder is entitled.

 

(e)             The Conversion Rate shall be subject to the following
adjustments (except as provided in Section 6(f)):

 

(i)              If the Company pays a dividend (or other distribution) in
shares of Common Stock to holders of the Common Stock, in their capacity as
holders of Common Stock, then the Conversion Rate in effect immediately
following the record date for such dividend (or distribution) shall be divided
by the following fraction:

 

OS1

OS0

 

where

 

OS0= the number of shares of Common Stock outstanding immediately prior to the
record date for such dividend or distribution; and

 

OS1= the sum of (A) the number of shares of Common Stock outstanding immediately
prior to the record date for such dividend or distribution and (B) the total
number of shares of Common Stock constituting such dividend.

 

14

 

 

(ii)             If the Company subdivides or splits the shares of Common Stock
into a greater or lesser number of shares of Common Stock, then the Conversion
Rate in effect immediately following the effective date of such share
subdivision or split shall be divided by the following fraction:

 

OS1

OS0

 

where

 

OS0= the number of shares of Common Stock outstanding immediately prior to the
effective date of such share subdivision or split; and

 

OS1= the number of shares of Common Stock outstanding immediately after the
opening of business on the effective date of such share subdivision or split.

 

(iii)            If the Company combines or reclassifies the shares of Common
Stock into a greater or lesser number of shares of Common Stock, then the
Conversion Rate in effect immediately following the effective date of such share
combination or reclassification shall be divided by the following fraction:

 

OS1

OS0

 

where

 

OS0= the number of shares of Common Stock outstanding immediately prior to the
effective date of such share combination or reclassification; and

 

OS1= the number of shares of Common Stock outstanding immediately after the
opening of business on the effective date of such share combination or
reclassification.

 

(iv)               If the Company issues by reclassification of its shares of
Common Stock any Equity Interests (including any reclassification in connection
with a merger, consolidation or business combination in which the Company is the
surviving Person), then the Conversion Rate in effect immediately following the
effective date of such reclassification shall be divided by the following
fraction:

 

OS1

OS0

 

where

 

OS0= the number of shares of Common Stock outstanding immediately prior to the
effective date of such share issuance by reclassification; and

 

OS1= the number of shares of Common Stock outstanding immediately after the
opening of business on the effective date of such share issuance by
reclassification.

 

15

 

 

(v)            In the case the Company effects a Pro Rata Repurchase of Common
Stock (in each case other than in connection with a Change of Control) then the
Conversion Rate shall be adjusted to the rate determined by multiplying the
Conversion Rate in effect immediately prior to the effective date of such Pro
Rata Repurchase by a fraction of which the numerator shall be (A) the product of
(1) the number of shares of Common Stock outstanding immediately before such Pro
Rata Repurchase and (2) the Market Value of a share of Common Stock on the
trading day immediately preceding the first public announcement by the Company
or any of its Affiliates of the intent to effect such Pro Rata Repurchase, minus
(B) the aggregate purchase price of the Pro Rata Repurchase, and of which the
denominator shall be the product of (1) the number of shares of Common Stock
outstanding immediately prior to such Pro Rata Repurchase minus the number of
shares of Common Stock so repurchased and (2) the Market Value per share of
Common Stock on the trading day immediately preceding the first public
announcement by the Company or any of its Affiliates of the intent to effect
such Pro Rata Repurchase.

 

(vi)           Subject to clause (vii) below, if the Company issues to holders
of shares of the Common Stock, in their capacity as holders of Common Stock,
rights, options or warrants entitling them to subscribe for or purchase shares
of Common Stock at less than the Market Value determined on the Ex-Date for such
issuance, then the Conversion Rate in effect immediately following the close of
business on the Ex-Date for such issuance shall be divided by the following
fraction:

 

OS0 + X

OS0 + Y

 

where

 

OS0= the number of shares of Common Stock outstanding at the close of business
on the record date for such issuance;

 

X= the total number of shares of Common Stock issuable pursuant to such rights,
options or warrants; and

 

Y= the number of shares of Common Stock equal to the aggregate price payable to
exercise such rights, options or warrants divided by the Market Value determined
as of the Ex-Date for such issuance.

 

(vii)          If the Company distributes to all holders of shares of Common
Stock evidences of indebtedness, shares of capital stock (other than Common
Stock) or other assets (including securities, but excluding any dividend or
distribution referred to in clauses (i) above; any rights or warrants referred
to in clause (vi) above; any consideration payable in connection with a tender
or exchange offer made by the Company or any of its Subsidiaries referred to in
clause (v) above and any dividend of shares of capital stock of any class or
series, or similar Equity Interests, of or relating to a Subsidiary or other
business unit in the case of certain spin-off transactions as described in
(viii) below), then the Conversion Rate in effect immediately following the
close of business on the record date for such distribution shall be divided by
the following fraction:

 

SP0

SP0 – FMV

 

where

 

SP0= the Closing Sale Price per share of Common Stock on the Trading Day
immediately preceding the Ex-Date; and

 

FMV= the fair market value of the portion of the distribution applicable to one
share of Common Stock on the Trading Day immediately preceding the Ex-Date as
determined by the Board of Directors.

 

16

 

 

Notwithstanding the foregoing, if “FMV” (as defined above) is equal to or
greater than “SP0” (as defined above), in lieu of the foregoing adjustment to
the Conversion Rate, each holder of Series A Preferred Stock shall receive, for
each share of Series A Preferred Stock, at the same time and upon the same terms
as holders of the Common Stock, the amount and kind of such distributed assets
that such holder would have received as if such holder owned a number of shares
of Common Stock equal to the quotient of (x) the Liquidation Preference plus
Accrued Dividends at such time and (y) the Conversion Rate at such time on the
Record Date for the distribution.

 

(viii)           In a spin-off, where the Company makes a dividend or
distribution to all holders of shares of Common Stock consisting of capital
stock of any class or series, or similar Equity Interests of, or relating to, a
Subsidiary or other business unit where such capital stock or similar Equity
Interests are, or will be when issued, listed or admitted for trading on a
National Securities Exchange, the Conversion Rate shall be adjusted on the tenth
Trading Day after the effective date of the distribution by dividing the
Conversion Rate in effect immediately prior to such tenth Trading Day by the
following fraction:

 

MP0 + MPS

MP0

 

where

 

MP0= the average of the Closing Sale Price of the Common Stock over each of the
first 10 Trading Days commencing on and including the Ex-Date of such
distribution; and

 

MPS= the average of the Closing Sale Price of the capital stock or Equity
Interests representing the portion of the distribution applicable to one share
of Common Stock over each of the first 10 Trading Days commencing on and
including the Ex-Date of such distribution, or, as reported in the principal
securities exchange or quotation system or market on which such shares are
traded, or if not traded on a national or regional securities exchange or
over-the-counter market, the fair market value of the capital stock or Equity
Interests representing the portion of the distribution applicable to one share
of Common Stock on such Ex-Date as determined by the Board of Directors. Such
Closing Sale Prices for the Trading Days in such 10 Trading Day period shall be
adjusted in respect of transactions in respect of such capital stock or Equity
Interests in like manner to the adjustment to “Closing Sale Price” specified in
the second sentence of the definition of such term.

 

For purposes of determining the Conversion Rate in respect of any Conversion
Date that occurs during the 10 Trading Days following, and including, the
Ex-Date of any such spin-off, references within the previous sentence to 10
Trading Days or the 10th Trading Day shall be deemed to be replaced with such
lesser number of Trading Days as have elapsed between the Ex-Date of such
distribution and such Conversion Date. In the event that such dividend or
distribution described in clause (vii) or clause (viii) of this Section 6(e) is
not so made, the Conversion Rate shall be readjusted, effective as of the date
the Board of Directors publicly announces its decision not to pay such dividend
or distribution, to the Conversion Rate that would then be in effect if such
dividend or distribution had not been declared.

 

(ix)            Notwithstanding any other provisions of this Section 6(e),
rights or warrants distributed by the Company to holders of Common Stock, in
their capacity as holders of Common Stock, entitling the holders thereof to
subscribe for or purchase shares of the Company’s capital stock (either
initially or under certain circumstances), which rights or warrants, until the
occurrence of a specified event or events (“Trigger Event”): (A) are deemed to
be transferred with such shares of Common Stock; (B) are not exercisable; and
(C) are also issued in respect of future issuances of Common Stock, shall be
deemed not to have been distributed for purposes of this Section 6(e) (and no
adjustment to the Conversion Rate under this Section 6(e) will be required)
until the occurrence of the earliest Trigger Event, whereupon such rights and
warrants shall be deemed to have been distributed and an appropriate adjustment
(if any is required) to the Conversion Rate shall be made under Section
6(e)(iii). In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other event with
respect thereto that was counted for purposes of calculating a distribution
amount for which an adjustment to the Conversion Rate under this Section 6(e)
was made, (1) in the case of any such rights or warrants that shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Rate shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder or holders of Common Stock with respect to such
rights or warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such redemption or
repurchase, and (2) in the case of such rights or warrants that shall have
expired or been terminated without exercise thereof, the Conversion Rate shall
be readjusted as if such expired or terminated rights and warrants had not been
issued. To the extent that the Company has a rights plan or agreement in effect
upon conversion of the Series A Preferred Stock, which rights plan provides for
rights or warrants of the type described in this clause, then upon conversion of
Series A Preferred Stock the Holder will receive, in addition to the Common
Stock to which he is entitled, a corresponding number of rights in accordance
with the rights plan, unless a Trigger Event has occurred and the adjustments to
the Conversion Rate with respect thereto have been made in accordance with the
foregoing. In lieu of any such adjustment, the Company may amend such applicable
shareholder rights plan or agreement to provide that upon conversion of the
Series A Preferred Stock the Holders will receive, in addition to the Common
Stock issuable upon such conversion, the rights that would have attached to such
Common Stock if the Trigger Event had not occurred under such applicable
shareholder rights plan or agreement.

 

17

 

 

(f)             Notwithstanding anything to the contrary in Section 6(e), no
adjustment to the Conversion Rate shall be made with respect to: (i) any
distribution or other transaction if the Holders are entitled to participate in
such distribution or transaction as if they held a number of shares of Common
Stock issuable upon conversion of the Series A Preferred Stock immediately prior
to such event, without having to convert their shares of Series A Preferred
Stock, (ii) any cash dividends made to holders of shares of Common Stock (unless
made in breach of Section 3(e)), (iii) any issuance of Equity Interests or
securities convertible into Equity Interests in exchange for cash, (iv) any
grant of shares of Common Stock or options, warrants or rights to purchase or
receive shares of Common Stock or the issuance of shares of Common Stock upon
the exercise or vesting of any such options, warrants or rights in respect of
services provided to or for the benefit of the Company or its Affiliates, under
compensation plans and agreements approved by the Board of Directors (including
any long-term incentive plan), (v) any issuance of shares of Common Stock as all
or part of the consideration to effect (A) the closing of any acquisition by the
Company of assets or Equity Interests of a third party in an arm’s-length
transaction, (B) the closing of any acquisition by the Company of assets or
Equity Interests of any of its Affiliates or (C) the consummation of a merger,
consolidation or other business combination of the Company with another entity
in which the Company survives and the shares of Common Stock remain outstanding
to the extent any such transaction set forth in clause (A), (B) or (C) above is
approved by the Board of Directors or (vi) the issuance of shares of Common
Stock upon conversion of the shares of Series A Preferred Stock or shares of
Parity Stock.

 

(g)            If the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a dividend or other
distribution, and shall thereafter (and before the dividend or distribution has
been paid or delivered to shareholders) abandon its plan to pay or deliver such
dividend or distribution, then thereafter no adjustment in the Conversion Rate
then in effect shall be required by reason of the taking of such record.

 

(h)            Upon any increase or decrease in the Conversion Rate, then, and
in each such case, the Company promptly shall deliver to each Holder a
certificate signed by an Officer, setting forth in reasonable detail the event
requiring the adjustment and the method by which such adjustment was calculated
and specifying the increased or decreased Conversion Rate then in effect
following such adjustment.

 

(i)             The issuance or delivery of certificates for Common Stock upon
the conversion of shares of Series A Preferred Stock and the issuance or
delivery of any Ownership Notice, whether at the request of a Holder or upon the
conversion of shares of Series A Preferred Stock, shall each be made without
charge to the Holder or recipient of shares of Series A Preferred Stock for such
certificates or Ownership Notice or for any tax in respect of the issuance or
delivery of such certificates or the securities represented thereby or such
Ownership Notice or the securities identified therein, and such certificates or
Ownership Notice shall be issued or delivered in the respective names of, or in
such names as may be directed by, the applicable Holder; provided, however, that
the Company shall not be required to pay any tax which may be payable in respect
of any transfer involved in the issuance and delivery of any such certificate in
a name other than that of the Holder of the shares of the relevant Series A
Preferred Stock and the Company shall not be required to issue or deliver any
such certificate or Ownership Notice unless or until the Person or Persons
requesting the issuance or delivery thereof shall have paid to the Company the
amount of such tax or shall have established to the reasonable satisfaction of
the Company that such tax has been paid.

 

18

 

 

(j)              Any shares of Common Stock delivered pursuant to this Section 6
shall be validly issued, fully paid and nonassessable (except as such
nonassessability may be affected by matters of any state or federal law), free
and clear or any liens, claims, rights or encumbrances other than those arising
under the laws of the Commonwealth of Pennsylvania or this Certificate of
Designations or created by the holders thereof.

 

(k)             The Company shall at all times reserve and keep available for
issuance upon the conversion of the Series A Preferred Stock such number of its
authorized but unissued shares of Common Stock as will from time to time be
sufficient to permit the conversion of all outstanding shares of Series A
Preferred Stock, and shall take all action required (including promptly calling
and holding one or more special meetings of the Board of Directors and the
shareholders of the Company until such increase is approved in accordance with
applicable law and amending the Articles of Incorporation) to increase the
authorized number of shares of Common Stock if at any time there shall be
insufficient unissued shares of Common Stock to permit such reservation or to
permit the conversion of all outstanding shares of Series A Preferred Stock or
the payment or partial payment of dividends (if any) declared on Series A
Preferred Stock that are payable in Common Stock. If the Company does not at any
time have reserved and available the number of shares of Common Stock described
in the preceding sentence, the Company shall pay to the Holders (on a Pro Rata
basis across all Holders based on their respective ownership of Series A
Preferred Stock) an amount equal to $50,000 per month (pro-rated for partial
months), payable in cash no later than 5 Business Days after the end of each
month until the Company again has reserved and available such number of shares
of Common Stock. For the avoidance of doubt and notwithstanding anything here to
the contrary, if the Company does not have a sufficient number of authorized but
unissued shares of Common Stock to cause the conversion of any shares of Series
A Preferred Stock when required, such shares of Series A Preferred Stock which
would otherwise have been converted into shares of Common Stock shall remain
outstanding and shall continue to accumulate and compound dividends pursuant to
Section 3 until such time as such shares of Series A Preferred Stock are
actually converted.

 

Section 7               Optional Redemption.

 

(a)             Subject to Section 7(d), at any time, and from time to time, on
or after January 1, 2024, the Company shall have the right, subject to
applicable law, to redeem the Holders’ shares of Series A Preferred Stock, in
whole or in part, from any source of funds legally available for such purpose in
accordance with this Section 7 and as permitted under Sections 1551 and 1552 of
the Pennsylvania BCL. Any redemption by the Company pursuant to this Section 7
shall be subject to compliance with the provisions of any agreements governing
the Company’s future or existing outstanding indebtedness. Any such redemption
shall occur on a date set by the Company in its sole discretion (the “Optional
Redemption Date”).

 

(b)            Subject to applicable law, the Company shall effect any such
redemption pursuant to this Section 7 by paying cash for each share of Series A
Preferred Stock to be redeemed in an amount equal to the greater of (i) the sum
of (1)(A) the Issue Price multiplied by (B) 110%, plus (2) the Accrued Dividends
as of such date and (ii) the amount the Holder of such share of Series A
Preferred Stock would receive if such Holder had converted such share of Series
A Preferred Stock into shares of Common Stock pursuant to Section 6(a) using the
then-applicable Conversion Rate and the Company liquidated immediately
thereafter (the “Optional Redemption Price”).

 

(c)            The Company shall give notice of its election to redeem the
Series A Preferred Stock pursuant to this Section 7 not less than 15 days and
not more than 90 days before the scheduled Optional Redemption Date, to the
Holders of Series A Preferred Stock as such Holders’ names appear (as of the
close of business on the Business Day next preceding the day on which notice is
given) on the books of the Transfer Agent at the address of such Holders shown
therein. Such notice (the “Optional Redemption Notice”) shall state: (i) the
Optional Redemption Date, (ii) the number of shares of Series A Preferred Stock
to be redeemed from such Holder, (iii) the Optional Redemption Price and
(iv) the place where any shares of Series A Preferred Stock in certificated form
are to be redeemed and shall be presented and surrendered for payment of the
Optional Redemption Price therefor.

 

(d)            If the Company elects to effect a partial redemption of the
Series A Preferred Stock pursuant to this Section 7, the number of shares of
Series A Preferred Stock to be redeemed shall be determined by the Company, but
shall be no less than 100,000 shares of Series A Preferred Stock (it being
understood that if the aggregate amount of shares of Series A Preferred Stock
outstanding is less than 100,000 shares, then all of such shares shall be
redeemed). In the event of a partial redemption of shares of Series A Preferred
Stock, such redemption shall occur on a Pro Rata basis across all Holders based
on their respective ownership of Series A Preferred Stock and the remaining
shares of Series A Preferred Stock that are not redeemed shall remain
outstanding. Notwithstanding anything to the contrary herein, the Company shall
be entitled to redeem Series A Preferred Stock pursuant to this Section 7 no
more than once per fiscal quarter.

 

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(e)           If the Company gives an Optional Redemption Notice, the Company
shall deposit with the Paying Agent funds sufficient to redeem the shares of
Series A Preferred Stock as to which such Optional Redemption Notice shall have
been given, no later than the open of business on the Optional Redemption Date,
and the Company shall give the Paying Agent irrevocable instructions and
authority to pay the Optional Redemption Price to the Holders to be redeemed
upon surrender or deemed surrender of the certificates therefor as set forth in
the Optional Redemption Notice. If the Optional Redemption Notice shall have
been given, then from and after the Optional Redemption Date, unless the Company
defaults in providing funds sufficient for such redemption at the time and place
specified for payment pursuant to the Optional Redemption Notice, all dividends
on such shares of Series A Preferred Stock to be redeemed shall cease to accrue
and all other rights with respect to the shares of Series A Preferred Stock to
be redeemed, including the rights, if any, to receive notices, will terminate,
except only the rights of Holders thereof to receive the Optional Redemption
Price. The Company shall be entitled to receive from the Paying Agent the
interest income, if any, earned on such funds deposited with the Paying Agent
(to the extent that such interest income is not required to pay the Optional
Redemption Price of the shares of Series A Preferred Stock to be redeemed), and
the holders of any shares of Series A Preferred Stock so redeemed shall have no
claim to any such interest income. Any funds deposited with the Paying Agent
hereunder by the Company for any reason, including redemption of shares of
Series A Preferred Stock, that remain unclaimed or unpaid after two years after
the Optional Redemption Date or other payment date, shall be, to the extent
permitted by applicable law, repaid to the Company upon its written request,
after which repayment the Holders entitled to such redemption or other payment
shall have recourse only to the Company. Notwithstanding any Optional Redemption
Notice, there shall be no redemption of any shares of Series A Preferred Stock
called for redemption until funds sufficient to pay the full Optional Redemption
Price of such shares shall have been deposited by the Company with the Paying
Agent.

 

Section 8Change of Control.

 

(a)           Promptly upon entry into a definitive agreement that provides for
a Change of Control (but in no event less than 10 Business Days prior to
consummating a Change of Control), the Company shall provide written notice
thereof to the Holders.

 

(b)           In the event of a Cash Change of Control, the Series A Preferred
Stock shall automatically be converted into Common Stock at the applicable
Conversion Rate on the date on which the Cash Change of Control occurs, with the
conversion effective immediately prior to the consummation of the Change of
Control.

 

(c)           In the event of a Change of Control that is not a Cash Change of
Control, then each Holder, with respect to all but not less than all of its
shares of Series A Preferred Stock, by notice given to the Company within 10
Business Days of the date the Company provides written notice of the execution
of definitive agreements that provide for such Change of Control, shall be
entitled to elect one of the following (with the understanding that any Holder
who fails to timely provide notice of its election to the Company shall be
deemed to have elected the option set forth in clause (1) below):

 

(i)            convert all, but not less than all, of such Holder’s outstanding
shares of Series A Preferred Stock into shares of Common Stock at the
then-applicable Conversion Rate on the date on which such Change of Control
occurs, with the conversion effective immediately prior to the consummation of
the Change of Control;

 

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(ii)           if the Company will not be the surviving Person upon the
consummation of such Change of Control or the Company will be the surviving
Person but its shares of Common Stock will no longer be listed or admitted to
trading on a National Securities Exchange, require the Company to use its
commercially reasonable efforts to deliver or to cause to be delivered to such
Holder, in exchange for its shares of Series A Preferred Stock upon the
consummation of such Change of Control, a security in the surviving Person or
the parent of the surviving Person that has rights, preferences and privileges
substantially equivalent to the shares of Series A Preferred Stock, including,
for the avoidance of doubt, (A) the right to distributions equal in amount and
timing to those provided in Section 4, (B) a conversion rate proportionately
adjusted such that the conversion of such security in the surviving Person or
parent of the surviving Person immediately following the consummation of such
Change of Control would entitle the holder of record to the number of common
securities of such Person (together with a number of common securities of
equivalent value to any other assets received by a holder of shares of Common
Stock in such Change of Control) which, if a share of Series A Preferred Stock
had been converted into a share of Common Stock immediately prior to such Change
of Control, such holder of record would have been entitled to receive
immediately following such Change of Control and (C) structural protections
(e.g., the definition of “Change of Control”) no less favorable to the Holders
than the protections set forth in this Certificate of Designations (such
security in the surviving Person, a “Substantially Equivalent Security”);
provided, however, that, if the Company is unable to deliver or cause to be
delivered a Substantially Equivalent Security to such Holder in connection with
such Change of Control, each Holder (at such Holder’s election) shall be
entitled to exercise the option provided in Section 8(c)(i) or Section 8(c)(iv)
or require the Company to convert the shares of Series A Preferred Stock held by
such Holder immediately prior to such Change of Control into a number of shares
of Common Stock (the “MOIC Shares”) at a conversion ratio per share of Series A
Preferred Stock owned by such Holder equal to: the quotient of (I) (a) the
product of (i) 160% multiplied by (ii) the Issue Price less (b) the sum of (i)
the aggregate cash distributions paid on such Series A Preferred Stock on or
prior to the date of such Change of Control plus (ii) $[●]2 divided by (II) an
amount equal to 95% of the VWAP of the Common Stock for the 20-day period
immediately preceding the consummation of such Change of Control; provided,
further, that such ratio shall in no event result in a share of Series A
Preferred Stock that is being converted into MOIC Shares having a MOIC Value
that (1) exceeds (x) 125% of the Issue Price, in the case of a Change of Control
occurring prior to April 10, 2021; and (y) 135% of the Issue Price, in the case
of a Change of Control occurring on or after April 10, 2021 but prior to April
10, 2022 or (2) irrespective of when such Change of Control occurs, is less than
the sum of (A) (x) the Issue Price, multiplied by (y) 110%, plus (B) all Accrued
Dividends on such share of Series A Preferred Stock on such date;

 

(iii)          if the Company is the surviving Person upon the consummation of
such Change of Control, continue to hold Holder’s respective shares of Series A
Preferred Stock; or

 

(iv)          require the Company to redeem all (but not less than all) of such
Holder’s respective shares of Series A Preferred Stock at a price per share of
Series A Preferred Stock equal to 101% of the sum of (x) the Issue Price, plus
(y) any Accrued Dividends on such Series A Preferred Stock as of such date. Any
redemption pursuant to this clause (iv) shall, as determined by the Company, be
paid in cash, in shares of Common Stock or in a combination thereof. If all or
any portion of such redemption is to be paid in shares of Common Stock, the
shares of Common Stock to be issued shall be valued at 95% of the VWAP for the
20-day period ending on the fifth Trading Day immediately preceding the
consummation of such Change of Control; provided, that any Holder that requires
the Company to redeem its shares of Series A Preferred Stock pursuant to this
Section 8(c)(iv) shall have the right to withdraw such election with respect to
all (but not less than all) of its shares of Series A Preferred Stock at any
time prior to the fifth Trading Day immediately preceding the consummation of
such Change of Control and instead elect to be treated in accordance with any of
clauses (i) through (iii) above. No later than three Trading Days prior to the
consummation of such Change of Control, the Company shall deliver a written
notice to the holders of record of the shares of Series A Preferred Stock
stating the date on which the shares of Series A Preferred Stock will be
redeemed and the Company’s computation of the amount of cash and/or shares of
Common Stock to be received by the holder of record upon redemption of such
shares of Series A Preferred Stock. If the Company shall be the surviving Person
upon the consummation of such Change of Control and its shares of Common Stock
will remain listed or admitted to trading on a National Securities Exchange,
then no later than 5 Business Days following the consummation of such Change of
Control, the Company shall remit the applicable cash and/or shares of Common
Stock consideration to each holder of record of then outstanding shares of
Series A Preferred Stock entitled to receive such cash or shares of Common Stock
consideration pursuant to this clause (iv). If the Company will not be the
surviving Person upon the consummation of such Change of Control or the Company
will be the surviving Person but its shares of Common Stock will no longer be
listed or admitted to trading on a National Securities Exchange, then the
Company shall remit the applicable cash and/or shares of Common Stock
consideration to such holders of record immediately prior to the consummation of
such Change of Control. Any redemptions by the Company shall comply with
Sections 1551 and 1552 of the Pennsylvania BCL. The holders of record shall
deliver to the Company certificates representing the shares of Series A
Preferred Stock, if any, as soon as practicable following such redemption.
Holders of the shares of Series A Preferred Stock shall retain all of the rights
and privileges thereof unless and until the consideration due to such Holders as
a result of such redemption is paid in full in cash, shares of Common Stock or a
combination of the foregoing, as applicable. After any such redemption, any such
redeemed share of Series A Preferred Stock shall no longer constitute an issued
and outstanding Equity Interest.

 

 

2Note to Draft: To equal the amount of per unit distributions actually paid in
cash on the Series A Preferred Units prior to the Closing.

 

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Section 9No Fractional Shares.

 

The shares of Series A Preferred Stock shall be issuable only in whole shares.
No fractional shares of Common Stock or securities representing fractional
shares of Common Stock shall be issued upon conversion, whether voluntary or
mandatory, or in respect of dividend payments made in Common Stock on the Series
A Preferred Stock. Instead, the Company shall round up to the next whole share
the number of shares of Common Stock to be issued to any particular Holder upon
conversion (and, for the avoidance of doubt, a 0.5 share of Common Stock shall
be rounded to the next higher share of Common Stock).

 

Section 10Uncertificated Shares; Certificated Shares.

 

(a)           Uncertificated Shares.

 

(i)            Form. Notwithstanding anything to the contrary herein, unless
requested in writing by a Holder to the Company, the shares of Series A
Preferred Stock and any shares of Common Stock issued upon conversion thereof
shall be in uncertificated, book entry form as permitted by the bylaws of the
Company and the Pennsylvania BCL. Within a reasonable time after the issuance or
transfer of uncertificated shares, the Company shall, or shall cause the
Transfer Agent to, send to the registered owner thereof an Ownership Notice.

 

(ii)          Transfer. Transfers of Series A Preferred Stock or Common Stock
issued upon conversion thereof held in uncertificated, book-entry form shall be
made only upon the transfer books of the Company kept at an office of the
Transfer Agent upon receipt of proper transfer instructions from the registered
owner of such uncertificated shares, or from a duly authorized attorney or from
an individual presenting proper evidence of succession, assignment or authority
to transfer the stock. The Company may refuse any requested transfer until
furnished evidence satisfactory to it that such transfer is proper.

 

(iii)          Legends. Each Ownership Notice issued with respect to a share of
Series A Preferred Stock or any Common Stock issued upon the conversion of
Series A Preferred Stock shall bear a legend in substantially the following
form:

 

“THE SECURITIES IDENTIFIED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS.
NEITHER THESE SECURITIES NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.

 

THE FOREGOING LEGEND WILL BE REMOVED AND A NEW OWNERSHIP NOTICE PROVIDED WITH
RESPECT TO THE SECURITIES IDENTIFIED HEREIN UPON THE REQUEST OF THE HOLDER AFTER
THE EXPIRATION OF THE APPLICABLE HOLDING PERIOD WITH RESPECT TO RESTRICTED
SECURITIES SET FORTH IN RULE 144 UNDER THE SECURITIES ACT.

 

SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION OF EQUITRANS MIDSTREAM CORPORATION (THE “COMPANY”),
INCLUDING THE CERTIFICATES OF DESIGNATIONS INCLUDED THEREIN (AS FURTHER AMENDED
AND RESTATED FROM TIME TO TIME, THE “CHARTER”), THE COMPANY IS AUTHORIZED TO
ISSUE MORE THAN ONE CLASS OF STOCK OR MORE THAN ONE SERIES OF ANY CLASS AND THE
COMPANY WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS THE
POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING, OPTIONAL OR OTHER
SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS,
LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. THE SHARES
EVIDENCED BY THIS NOTICE ARE SUBJECT TO THE OBLIGATIONS AND RESTRICTIONS STATED
IN, AND ARE TRANSFERABLE ONLY IN ACCORDANCE WITH, THE PROVISIONS OF THE CHARTER.
THE TERMS OF THE CHARTER ARE HEREBY INCORPORATED INTO THIS NOTICE BY REFERENCE.

 

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IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.”

 

In addition, each Ownership Notice issued with respect to a share of Series A
Preferred Stock shall bear a legend in substantially the following form:

 

“BY ACCEPTANCE HEREOF AND ONLY UNTIL APRIL 10, 2021, THE HOLDER SHALL BE DEEMED
TO HAVE AGREED WITH THE COMPANY THAT, FOR SO LONG AS THE HOLDER HOLDS THIS
SECURITY, THE HOLDER SHALL NOT DIRECTLY OR INDIRECTLY ENGAGE IN ANY SHORT SALE
OF THE COMMON STOCK OF THE COMPANY (OR OTHER DERIVATIVE OR HEDGING TRANSACTIONS)
THAT ARE DESIGNED TO, OR THAT MIGHT REASONABLY BE EXPECTED TO, RESULT IN THE
TRANSFER TO ANOTHER PERSON, IN WHOLE OR IN PART, ANY OF THE ECONOMIC
CONSEQUENCES OF OWNERSHIP OF THIS SECURITY.”

 

(b)           Certificated Shares.

 

(i)            Form and Dating. When Series A Preferred Stock is in certificated
form (“Certificated Series A Preferred Stock”), the Series A Preferred Stock
certificate and the Transfer Agent’s certificate of authentication shall be
substantially in the form set forth in Exhibit A, which is hereby incorporated
in and expressly made a part of this Certificate of Designations. The Series A
Preferred Stock certificate may have notations, legends or endorsements required
by applicable law, stock exchange rules, agreements to which the Company is
subject, if any, or usage; provided that any such notation, legend or
endorsement is in a form acceptable to the Company. Each Series A Preferred
Stock certificate shall be dated the date of its authentication.

 

(ii)           Execution and Authentication. Two Officers shall sign each Series
A Preferred Stock certificate for the Company by manual or facsimile signature.

 

If an Officer whose signature is on a Series A Preferred Stock certificate no
longer holds that office at the time the Transfer Agent authenticates the Series
A Preferred Stock certificate, the Series A Preferred Stock certificate shall be
valid nevertheless.

 

A Series A Preferred Stock certificate shall not be valid until an authorized
signatory of the Transfer Agent manually signs the certificate of authentication
on the Series A Preferred Stock certificate. The signature shall be conclusive
evidence that the Series A Preferred Stock certificate has been authenticated
under this Certificate of Designations.

 

The Transfer Agent shall authenticate and deliver certificates for shares of
Series A Preferred Stock for original issue upon a written order of the Company
signed by two Officers or by an Officer and an Assistant Treasurer of the
Company. Such order shall specify the number of shares of Series A Preferred
Stock to be authenticated and the date on which the original issue of the Series
A Preferred Stock is to be authenticated.

 

The Transfer Agent may appoint an authenticating agent reasonably acceptable to
the Company to authenticate the certificates for the Series A Preferred Stock.
Unless limited by the terms of such appointment, an authenticating agent may
authenticate certificates for the Series A Preferred Stock whenever the Transfer
Agent may do so. Each reference in this Certificate of Designations to
authentication by the Transfer Agent includes authentication by such agent. An
authenticating agent has the same rights as the Transfer Agent or agent for
service of notices and demands.

 

23

 

 

(iii)          Transfer and Exchange. When Certificated Series A Preferred Stock
is presented to the Transfer Agent with a request to register the transfer of
such Certificated Series A Preferred Stock or to exchange such Certificated
Series A Preferred Stock for an equal number of shares of Certificated Series A
Preferred Stock, the Transfer Agent shall register the transfer or make the
exchange as requested if its reasonable requirements for such transaction are
met; provided, however, that the Certificated Series A Preferred Stock
surrendered for transfer or exchange:

 

(A)          shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Transfer Agent,
duly executed by the Holder thereof or its attorney duly authorized in writing;
and

 

(B)          is being transferred or exchanged pursuant to subclause (1) or
(2) below, and is accompanied by the following additional information and
documents, as applicable:

 

(1)           if such Certificated Series A Preferred Stock is being delivered
to the Transfer Agent by a Holder for registration in the name of such Holder,
without transfer, a certification from such Holder to that effect in
substantially the form of Exhibit C hereto; or

 

(2)           if such Certificated Series A Preferred Stock is being transferred
to the Company or to a “qualified institutional buyer” in accordance with Rule
144A under the Securities Act or pursuant to another exemption from registration
under the Securities Act, (x) a certification to that effect (in substantially
the form of Exhibit C hereto) and (y) if the Company so requests, an opinion of
counsel or other evidence reasonably satisfactory to it as to the compliance
with the restrictions set forth in the legend set forth in Section 10(b)(iv).

 

(iv)          Legends.

 

(A)          Each certificate evidencing Certificated Series A Preferred Stock
or any Common Stock issued upon the conversion of Series A Preferred Stock shall
bear a legend in substantially the following form:

 

“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THESE
SECURITIES NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.

 

THE FORGOING LEGEND WILL BE REMOVED AND A NEW CERTIFICATE PROVIDED WITH RESPECT
TO THESE SECURITIES UPON THE REQUEST OF THE HOLDER AFTER THE EXPIRATION OF THE
APPLICABLE HOLDING PERIOD WITH RESPECT TO RESTRICTED SECURITIES SET FORTH IN
RULE 144 UNDER THE SECURITIES ACT.

 

SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION OF EQUITRANS MIDSTREAM CORPORATION (THE “COMPANY”),
INCLUDING THE CERTIFICATES OF DESIGNATIONS INCLUDED THEREIN (AS FURTHER AMENDED
AND RESTATED FROM TIME TO TIME, THE “CHARTER”), THE COMPANY IS AUTHORIZED TO
ISSUE MORE THAN ONE CLASS OF STOCK OR MORE THAN ONE SERIES OF ANY CLASS AND THE
COMPANY WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS THE
POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING, OPTIONAL OR OTHER
SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS,
LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. THE SHARES
EVIDENCED BY THIS NOTICE ARE SUBJECT TO THE OBLIGATIONS AND RESTRICTIONS STATED
IN, AND ARE TRANSFERABLE ONLY IN ACCORDANCE WITH, THE PROVISIONS OF THE CHARTER.
THE TERMS OF THE CHARTER ARE HEREBY INCORPORATED INTO THIS CERTIFICATE BY
REFERENCE.

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.”

 

24

 

 

In addition, each certificate issued with respect to a share of Series A
Preferred Stock shall bear a legend in substantially the following form:

 

“BY ACCEPTANCE HEREOF AND ONLY UNTIL APRIL 10, 2021, THE HOLDER SHALL BE DEEMED
TO HAVE AGREED WITH THE COMPANY THAT, FOR SO LONG AS THE HOLDER HOLDS THIS
SECURITY, THE HOLDER SHALL NOT DIRECTLY OR INDIRECTLY ENGAGE IN ANY SHORT SALE
OF THE COMMON STOCK OF THE COMPANY (OR OTHER DERIVATIVE OR HEDGING TRANSACTIONS)
THAT ARE DESIGNED TO, OR THAT MIGHT REASONABLY BE EXPECTED TO, RESULT IN THE
TRANSFER TO ANOTHER PERSON, IN WHOLE OR IN PART, ANY OF THE ECONOMIC
CONSEQUENCES OF OWNERSHIP OF THIS SECURITY.”

 

(B)          Upon any sale or transfer of a Transfer Restricted Security held in
certificated form pursuant to Rule 144 under the Securities Act or another
exemption from registration under the Securities Act or an effective
registration statement under the Securities Act, the Transfer Agent shall permit
the Holder thereof to exchange such Transfer Restricted Security for
Certificated Series A Preferred Stock or certificated Common Stock that does not
bear a restrictive legend and rescind any restriction on the transfer of such
Transfer Restricted Security.

 

(v)           Replacement Certificates. If any of the Series A Preferred Stock
certificates shall be mutilated, lost, stolen or destroyed, the Company shall
issue, in exchange and in substitution for and upon cancellation of the
mutilated Series A Preferred Stock certificate, or in lieu of and substitution
for the Series A Preferred Stock certificate lost, stolen or destroyed, a new
Series A Preferred Stock certificate of like tenor and representing an
equivalent amount of shares of Series A Preferred Stock, but only upon receipt
of evidence of such loss, theft or destruction of such Series A Preferred Stock
certificate and indemnity, if requested, satisfactory to the Company and the
Transfer Agent.

 

(vi)          Cancellation. In the event the Company shall purchase or otherwise
acquire Certificated Series A Preferred Stock, the same shall thereupon be
delivered to the Transfer Agent for cancellation. The Transfer Agent and no one
else shall cancel and destroy all Series A Preferred Stock certificates
surrendered for transfer, exchange, replacement or cancellation and deliver a
certificate of such destruction to the Company unless the Company directs the
Transfer Agent to deliver canceled Series A Preferred Stock certificates to the
Company. The Company may not issue new Series A Preferred Stock certificates to
replace Series A Preferred Stock certificates to the extent they evidence Series
A Preferred Stock which the Company has purchased or otherwise acquired.

 

(c)           Certain Obligations with Respect to Transfers and Exchanges of
Series A Preferred Stock.

 

(i)            To permit registrations of transfers and exchanges, the Company
shall execute and the Transfer Agent shall authenticate Certificated Series A
Preferred Stock as required pursuant to the provisions of this Section 10.

 

(ii)           All shares of Series A Preferred Stock, whether or not
Certificated Series A Preferred Stock, issued upon any registration of transfer
or exchange of such shares of Series A Preferred Stock shall be the valid
obligations of the Company, entitled to the same benefits under this Certificate
of Designations as the shares of Series A Preferred Stock surrendered upon such
registration of transfer or exchange.

 

(iii)          Prior to due presentment for registration of transfer of any
shares of Series A Preferred Stock, the Transfer Agent and the Company may deem
and treat the Person in whose name such shares of Series A Preferred Stock are
registered as the absolute owner of such Series A Preferred Stock and neither
the Transfer Agent nor the Company shall be affected by notice to the contrary.

 

(iv)          No service charge shall be made to a Holder for any registration
of transfer or exchange of any Series A Preferred Stock or Common Stock issued
upon the conversion thereof on the transfer books of the Company or the Transfer
Agent or upon surrender of any Series A Preferred Stock certificate or Common
Stock certificate at the office of the Transfer Agent maintained for that
purpose. However, the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Series A Preferred Stock or Common Stock
if the Person receiving shares in connection with such transfer or exchange is
not the holder thereof.

 

25

 

 

(d)           No Obligation of the Transfer Agent. The Transfer Agent shall have
no obligation or duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Certificate of Designations or under
applicable law with respect to any transfer of any interest in any Series A
Preferred Stock other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and when
expressly required by, the terms of this Certificate of Designations, and to
examine the same to determine substantial compliance as to form with the express
requirements hereof.

 

(e)           Removal of Legend. In connection with a sale of any Series A
Preferred Stock or the shares of Common Stock issuable upon conversion of the
Series A Preferred Stock in reliance on Rule 144 promulgated under the
Securities Act, the applicable Holder or its broker shall deliver to the Company
and its Transfer Agent a broker representation letter providing to the Company
and its Transfer Agent any information the Company deems necessary to determine
that such sale is made in compliance with Rule 144, including, as may be
appropriate, a certification that the applicable Holder is not an Affiliate of
the Company and regarding the length of time the Series A Preferred Stock or the
shares of Common Stock issuable upon conversion of the Series A Preferred Stock
have been held. Upon receipt of such representation letter, the Company shall
promptly direct its Transfer Agent to remove the applicable legend referred to
in this Section 10 from the appropriate book-entry accounts maintained by the
Transfer Agent or certificates, as applicable, and the Company shall bear all
costs associated therewith (including paying the reasonable customary cost of
any legal opinion required by the Transfer Agent to be rendered in connection
with the removal of such legend). After a Holder or its permitted assigns have
held the Series A Preferred Stock or the Common Stock issuable upon conversion
of the Series A Preferred Stock for such time as non-Affiliates are permitted to
sell without the requirement for the Company to be in compliance with the
current public information required under Rule 144(c)(1) (or Rule 144(i)(2), if
applicable) as to such Series A Preferred Stock or Common Stock issuable upon
conversion of the Series A Preferred Stock and without volume or manner of sale
restrictions under Rule 144, if the book-entry accounts for such Series A
Preferred Stock or Common Stock issuable upon conversion of the Series A
Preferred Stock still bear the applicable restrictive legend referred to in this
Section 10, the Company agrees, upon request of such Holder or permitted
assignee, to take all steps necessary to promptly effect the removal of the
applicable legend described in this Section 10 therefrom, and the Company shall
bear all costs associated therewith (including paying the reasonable customary
cost of any legal opinion required by the Transfer Agent to be rendered in
connection with the removal of such legend), regardless of whether the request
is made in connection with a sale or otherwise, so long as such Holder or its
permitted assigns provide to the Company any information the Company deems
necessary to determine that the legend is no longer required under the
requirements of the Securities Act and the rules and regulations of the SEC
thereunder or applicable state laws, including a certification that the holder
is not an Affiliate of the Company (and a covenant to inform the Company if it
should thereafter become an Affiliate and to consent to the placing of an
appropriate restrictive legend on the applicable Series A Preferred Stock in
such case) and regarding the length of time the Series A Preferred Stock or the
Common Stock issuable upon conversion of the Series A Preferred Stock have been
held. The Company shall cooperate with the Holders to effect the removal of the
applicable legend referred to in this Section 10 at any time such legend is no
longer appropriate.

 

Section 11Other Provisions.

 

(a)           With respect to any notice to a Holder required to be provided
hereunder, neither failure to mail such notice, nor any defect therein or in the
mailing thereof, to any particular Holder shall affect the sufficiency of the
notice or the validity of the proceedings referred to in such notice with
respect to the other Holders or affect the legality or validity of any vote upon
any such action (assuming due and proper notice to such other Holders). Any
notice which was mailed in the manner herein provided shall be conclusively
presumed to have been duly given whether or not the Holder receives the notice.

 

(b)           Shares of Series A Preferred Stock that have been issued and
reacquired by the Company in any manner, including shares of Series A Preferred
Stock purchased or redeemed or exchanged or converted, shall (upon compliance
with any applicable provisions of the laws of Pennsylvania) upon such
reacquisition be automatically cancelled by the Company and shall not be
reissued.

 

(c)           The shares of Series A Preferred Stock shall be issuable only in
whole shares.

 

(d)           All notice periods referred to herein shall commence: (i) when
made, if made by hand delivery, and upon confirmation of receipt, if made by
facsimile; (ii) one Business Day after being deposited with a nationally
recognized next-day courier, postage prepaid; or (iii) three Business Days after
being by first-class mail, postage prepaid. Notice to any Holder shall be given
to the registered address set forth in the Company’s records for such Holder.

 

26

 

 

(e)           Any payments required to be made hereunder on any day that is not
a Business Day shall be made on the next succeeding Business Day without
interest or additional payment for such delay. All payments required hereunder
shall be made by wire transfer of immediately available funds in United States
Dollars to the Holders in accordance with the payment instructions as such
Holders may deliver by written notice to the Company from time to time.

 

(f)            Notwithstanding anything to the contrary herein, whenever the
Board of Directors is permitted or required to determine fair market value, such
determination shall be made in good faith.

 

(g)           Except as set forth in Section 4(b)(ii), the Holders shall have no
preemptive or preferential rights to purchase or subscribe to any stock,
obligations, warrants or other securities of the Company of any class.

 

(h)          The Company shall distribute to the Holders copies of all notices,
materials, annual and quarterly reports, proxy statements, information
statements and any other documents distributed generally to the holders of the
Common Stock, at such times and by such method as documents are distributed to
such holders of such Common Stock.

 

(i)           All payments and distributions (or deemed distributions) on the
shares of Series A Preferred Stock (and any share of Common Stock issued upon
the conversion or redemption of any share of Series A Preferred Stock) shall be
subject to withholding and backup withholding of taxes to the extent required by
applicable law, subject to applicable exemptions or reductions, and amounts
withheld, if any, shall be treated as received by the Holders to the extent
timely paid by the Company, the Transfer Agent or any of their respective agents
or Affiliates to the appropriate taxing authority in accordance with applicable
law.

 

[Signature page follows.]

 

27

 

 

IN WITNESS WHEREOF, the Company has caused this certificate to be signed and
attested this [_] day of [_], 2020.

 

  EQUITRANS MIDSTREAM CORPORATION       By:       Kirk R. Oliver     Senior Vice
President and Chief Financial Officer

 

 

SIGNATURE PAGE TO CERTIFICATE OF DESIGNATIONS

 

28

 

 

EXHIBIT A

 

FORM OF SERIES A PREFERRED STOCK

 

FACE OF SECURITY

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THESE
SECURITIES NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.

 

THE FORGOING LEGEND WILL BE REMOVED AND A NEW CERTIFICATE PROVIDED WITH RESPECT
TO THESE SECURITIES UPON THE REQUEST OF THE HOLDER AFTER THE EXPIRATION OF THE
APPLICABLE HOLDING PERIOD WITH RESPECT TO RESTRICTED SECURITIES SET FORTH IN
RULE 144 UNDER THE SECURITIES ACT.

 

SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION OF EQUITRANS MIDSTREAM CORPORATION (THE “COMPANY”),
INCLUDING THE CERTIFICATES OF DESIGNATIONS INCLUDED THEREIN (AS FURTHER AMENDED
AND RESTATED FROM TIME TO TIME, THE “CHARTER”), THE COMPANY IS AUTHORIZED TO
ISSUE MORE THAN ONE CLASS OF STOCK OR MORE THAN ONE SERIES OF ANY CLASS AND THE
COMPANY WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS THE
POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING, OPTIONAL OR OTHER
SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS,
LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. THE SHARES
EVIDENCED BY THIS NOTICE ARE SUBJECT TO THE OBLIGATIONS AND RESTRICTIONS STATED
IN, AND ARE TRANSFERABLE ONLY IN ACCORDANCE WITH, THE PROVISIONS OF THE CHARTER.
THE TERMS OF THE CHARTER ARE HEREBY INCORPORATED INTO THIS CERTIFICATE BY
REFERENCE.

 

“BY ACCEPTANCE HEREOF AND ONLY UNTIL APRIL 10, 2021, THE HOLDER SHALL BE DEEMED
TO HAVE AGREED WITH THE COMPANY THAT, FOR SO LONG AS THE HOLDER HOLDS THIS
SECURITY, THE HOLDER SHALL NOT DIRECTLY OR INDIRECTLY ENGAGE IN ANY SHORT SALE
OF THE COMMON STOCK OF THE COMPANY (OR OTHER DERIVATIVE OR HEDGING TRANSACTIONS)
THAT ARE DESIGNED TO, OR THAT MIGHT REASONABLY BE EXPECTED TO, RESULT IN THE
TRANSFER TO ANOTHER PERSON, IN WHOLE OR IN PART, ANY OF THE ECONOMIC
CONSEQUENCES OF OWNERSHIP OF THIS SECURITY.”

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

 A-1 

 

 

 

Certificate Number
[                         ] [                            ] Shares of
Series A Preferred Stock

Series A Preferred Stock
of
EQUITRANS MIDSTREAM CORPORATION

 

EQUITRANS MIDSTREAM CORPORATION, a Pennsylvania corporation (the “Company”),
hereby certifies that [                    ] (the “Holder”) is the registered
owner of [                    ] fully paid and non-assessable shares of Series A
Preferred Stock, no par value, of the Company designated as the Series A
Perpetual Convertible Preferred Shares (the “Series A Preferred Stock”). The
shares of Series A Preferred Stock are transferable on the books and records of
the Transfer Agent, in person or by a duly authorized attorney, upon surrender
of this certificate duly endorsed and in proper form for transfer. The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Series A Preferred Stock represented hereby are issued and
shall in all respects be subject to the provisions of the Certificate of
Designations dated [ ], 2020, as the same may be amended from time to time (the
“Certificate of Designations”). Capitalized terms used herein but not defined
shall have the meaning given them in the Certificate of Designations. The
Company will provide a copy of the Certificate of Designations to a Holder
without charge upon written request to the Company at its principal place of
business.

 

Reference is hereby made to select provisions of the Series A Preferred Stock
set forth on the reverse hereof, and to the Certificate of Designations, which
select provisions and the Certificate of Designations shall for all purposes
have the same effect as if set forth at this place.

 

Upon receipt of this certificate, the Holder is bound by the Certificate of
Designations and is entitled to the benefits thereunder.

 

Unless the Transfer Agent’s Certificate of Authentication hereon has been
properly executed, these shares of Series A Preferred Stock shall not be
entitled to any benefit under the Certificate of Designations or be valid or
obligatory for any purpose.

 

IN WITNESS WHEREOF, the Company has executed this certificate this
                    day of                     , 2020.

 

  EQUITRANS MIDSTREAM CORPORATION           By:     Name:   Title:           By:
       Name:   Title:

 

 A-2 

 

 

TRANSFER AGENT’S CERTIFICATE OF AUTHENTICATION

 

These are shares of the Series A Preferred Stock referred to in the
within-mentioned Certificate of Designations.

 

Dated:     AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,   as Transfer Agent,  
        By:            Authorized Signatory

 

 A-3 

 

 

REVERSE OF SECURITY

 

Dividends on each share of Series A Preferred Stock shall be payable, when, as
and if declared by the Company’s Board of Directors out of legally available
funds as provided in the Certificate of Designations.

 

The shares of Series A Preferred Stock shall be convertible into the Company’s
Common Stock upon the satisfaction of the conditions and in the manner and
according to the terms set forth in the Certificate of Designations.

 

The shares of Series A Preferred Stock may be redeemed by the Company upon the
satisfaction of the conditions and in the manner and according to the terms set
forth in the Certificate of Designations.

 

The Company will furnish without charge to each holder who so requests the
powers, designations, preferences and relative, participating, optional or other
special rights of each class of stock and the qualifications, limitations or
restrictions of such preferences and/or rights.

 

 A-4 

 

 

ASSIGNMENT

 

FOR VALUE RECEIVED, the undersigned assigns and transfers the shares of Series A
Preferred Stock evidenced hereby to:

 

     

 

(Insert assignee’s social security or tax identification number)

 

 

 

(Insert address and zip code of assignee)

 

 

 

and irrevocably appoints:

 

     

 

agent to transfer the shares of Series A Preferred Stock evidenced hereby on the
books of the Transfer Agent. The agent may substitute another to act for him or
her.

 

Date:   

 

Signature: 

 

(Sign exactly as your name appears on the other side of this Series A Preferred
Stock Certificate)

 

Signature Guarantee: 3

 

3Signature must be guaranteed by an “eligible guarantor institution” that is a
bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Transfer Agent, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program (“STAMP”) or
such other “signature guarantee program” as may be determined by the Transfer
Agent in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

 

 A-5 

 

 

EXHIBIT B

 

OWNERSHIP NOTICE

 

THE SECURITIES IDENTIFIED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS.
NEITHER THESE SECURITIES NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.

 

THE FOREGOING LEGEND WILL BE REMOVED AND A NEW OWNERSHIP NOTICE PROVIDED WITH
RESPECT TO THE SECURITIES IDENTIFIED HEREIN UPON THE REQUEST OF THE HOLDER AFTER
THE EXPIRATION OF THE APPLICABLE HOLDING PERIOD WITH RESPECT TO RESTRICTED
SECURITIES SET FORTH IN RULE 144 UNDER THE SECURITIES ACT.

 

SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE AMENDED AND RESTATED
ARTICLES OF INCORPORATION OF EQUITRANS MIDSTREAM CORPORATION (THE “COMPANY”),
INCLUDING THE CERTIFICATES OF DESIGNATIONS INCLUDED THEREIN (AS FURTHER AMENDED
AND RESTATED FROM TIME TO TIME, THE “CHARTER”), THE COMPANY IS AUTHORIZED TO
ISSUE MORE THAN ONE CLASS OF STOCK OR MORE THAN ONE SERIES OF ANY CLASS AND THE
COMPANY WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS THE
POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING, OPTIONAL OR OTHER
SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS,
LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. THE SHARES
EVIDENCED BY THIS NOTICE ARE SUBJECT TO THE OBLIGATIONS AND RESTRICTIONS STATED
IN, AND ARE TRANSFERABLE ONLY IN ACCORDANCE WITH, THE PROVISIONS OF THE CHARTER.
THE TERMS OF THE CHARTER ARE HEREBY INCORPORATED INTO THIS NOTICE BY REFERENCE.

 

IF THE SECURITIES IDENTIFIED HEREIN ARE SERIES A PREFERRED STOCK OF THE COMPANY,
THEN BY ACCEPTANCE HEREOF AND ONLY UNTIL APRIL 10, 2021, THE HOLDER SHALL BE
DEEMED TO HAVE AGREED WITH THE COMPANY THAT, FOR SO LONG AS THE HOLDER HOLDS
THIS SECURITY, THE HOLDER SHALL NOT DIRECTLY OR INDIRECTLY ENGAGE IN ANY SHORT
SALE OF THE COMMON STOCK OF THE COMPANY (OR OTHER DERIVATIVE OR HEDGING
TRANSACTIONS) THAT ARE DESIGNED TO, OR THAT MIGHT REASONABLY BE EXPECTED TO,
RESULT IN THE TRANSFER TO ANOTHER PERSON, IN WHOLE OR IN PART, ANY OF THE
ECONOMIC CONSEQUENCES OF OWNERSHIP OF THIS SECURITY.

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

This letter confirms and acknowledges that you are the registered owner of the
number and the class or series of shares of capital stock of the Company listed
on Schedule A to this letter.

 

In addition, please be advised that the Company will furnish without charge to
each shareholder of the Company who so requests the powers, designations,
preferences and relative participating, optional or other special rights of each
class of stock, or series thereof, of the Company and the qualifications,
limitations or restrictions of such preferences and/or rights, which are fixed
by the Charter. Any such request should be directed to the Corporate Secretary
of the Company.

 

The shares of capital stock of the Company have been not been registered under
the Securities Act and, accordingly, may not be offered, sold, pledged or
otherwise transferred within the United States or to, or for the account or
benefit of, U.S. persons except pursuant to an effective registration statement
under the Act or an exemption from the registration requirements of the Act.

 

 B-1 

 

 

Dated:  

      AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,   as Transfer Agent,        
  By:       Authorized Signatory

 

 B-2 

 

 

EXHIBIT C

 

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION OF TRANSFER OF SERIES A PREFERRED STOCK

 

Re: Series A Perpetual Convertible Preferred Shares (the “Series A Preferred
Stock”) of Equitrans Midstream Corporation (the “Company”)

 

This Certificate relates to shares of Series A Preferred Stock held by (the
“Transferor”) in */:

 

¨book entry form; or

 

¨definitive form.

 

The Transferor has requested the Transfer Agent by written order to exchange or
register the transfer of Series A Preferred Stock.

 

In connection with such request and in respect of such Series A Preferred Stock,
the Transferor does hereby certify that the Transferor is familiar with the
Certificate of Designations relating to the above-captioned Series A Preferred
Stock and that the transfer of this Series A Preferred Stock does not require
registration under the Securities Act of 1933 (the “Securities Act”) because */:

 

¨such Series A Preferred Stock is being acquired for the Transferor’s own
account without transfer;

 

¨such Series A Preferred Stock is being transferred to the Company;

 

¨such Series A Preferred Stock is being transferred to a qualified institutional
buyer (as defined in Rule 144A under the Securities Act), in reliance on Rule
144A; or

 

¨such Series A Preferred Stock is being transferred in reliance on and in
compliance with another exemption from the registration requirements of the
Securities Act (and based on an Opinion of Counsel if the Company so requests).

 

[INSERTNAME OF TRANSFEROR]          By:     Date:  

 

 

*/Please check applicable box.

 

  

 

 

Exhibit C

 

Form of Opinion of McGuireWoods LLP

 

1.            Organizational Status. Based solely on the Corporate Status
Certificate, the Company is a validly existing corporation under the laws of the
Commonwealth of Pennsylvania and is subsisting under such laws.

 

2.            Power and Authority. The Company has the corporate power and
authority to own its properties and to conduct its business in all material
respects as described in the Company’s most recent Annual Report on Form 10-K.

 

3.            Equitrans L.P. Organizational Status. Based solely on the
Corporate Status Certificate, Equitrans L.P., a limited partnership organized
under the laws of the Commonwealth of Pennsylvania (“Equitrans L.P.”) is a
validly existing limited partnership under the laws of the Commonwealth of
Pennsylvania and is subsisting under such laws.

 

4.            Equitrans L.P. Power and Authority. Equitrans L.P. has the limited
partnership power and authority to own its properties and to conduct its
business in all material respects as described in the Company’s most recent
Annual Report on Form 10-K.

 

5.            Series A Preferred Shares. When (a) the Series A Preferred Shares
have been issued and delivered as contemplated by the Agreement, (b) the Company
has received the consideration provided for in the Agreement, (c) such
consideration per share is not less than the amount required by the Authorizing
Resolutions, (d) the Certificate of Designations has been duly filed with the
Pennsylvania Department of State, Bureau of Corporations and Charitable
Organizations of the Commonwealth of Pennsylvania and (e) certificates in the
form required under the laws of the Commonwealth of Pennsylvania representing
the shares of such Preferred Stock are duly executed, countersigned, registered
and delivered, if such Preferred Stock is certificated, or book-entry notations
in the form required under the laws of the Commonwealth of Pennsylvania have
been made in the share register of the Company, if such Preferred Stock is not
represented by certificates, such Series A Preferred Shares will be validly
issued, fully paid and non-assessable.

 

6.            Common Stock. With respect to any Company Common Stock to be
issued by the Company upon the conversion of the Series A Preferred Shares, when
such Company Common Stock has been (a) issued and delivered upon conversion of
the Series A Preferred Shares in accordance with the terms the Certificate of
Designations, and (b) certificates in the form required under the laws of the
Commonwealth of Pennsylvania representing the shares of such Company Common
Stock are duly executed, countersigned, registered and delivered, if such
Company Common Stock is certificated, or book-entry notations in the form
required under the laws of the Commonwealth of Pennsylvania have been made in
the share register of the Company, if such Company Common Stock is not
represented by certificates, such Company Common Stock will be validly issued,
fully paid and non-assessable.

 

7.            Execution and Delivery. The execution, delivery and performance of
the Certificate of Designations, the Agreement and the Registration Rights
Agreement (the “Subject Documents”) by the Company has been duly authorized by
all necessary corporate action, and to the extent governed by Applicable Law,
the Company has duly executed and delivered each Subject Document.

 

Exhibit C

Preferred Restructuring Agreement

 

 

 

8.            Noncontravention. Neither the execution and delivery by the
Company of any Subject Document to which it is a party, nor the performance by
the Company of its obligations thereunder (including the issuance and delivery
of the Series A Preferred Shares and the issuance and delivery of any Company
Common Stock to be issued by the Company upon the conversion of the Series A
Preferred Shares) (a) violates any provision of the Organizational Documents of
the Company; or (b) violates any statute or regulation of Applicable Law that,
in each case, is applicable to the Company.

 

9.            Governmental Approvals. No consent, approval or authorization of,
or filing with, any governmental authority of the Commonwealth of Pennsylvania
pursuant to any statute or regulation of Applicable Law , that in each case, is
applicable to the Company is required for the due execution and delivery by the
Company of the Subject Documents or the performance by the Company of its
obligations thereunder, except (a) as have been previously made or obtained, or
(b) filings, consents or approvals under applicable state securities laws
(including Blue Sky laws).

 

Exhibit C

Preferred Restructuring Agreement

 

 

 

Exhibit D

 

Form of Opinion of Latham & Watkins LLP

 

1.The Partnership is a limited partnership under the DRULPA, with limited
partnership power and authority to own its properties and to conduct its
business in all material respects as described in the SEC Reports. With your
consent, based solely on certificates from public officials, we confirm that the
Partnership is validly existing and in good standing under the laws of the State
of Delaware.

 

2.The General Partner is a limited liability company under the Delaware LLC Act,
with limited liability company power and authority to own its properties,
conduct its business and act as the general partner of the Partnership in all
material respects as described in the SEC Reports. With your consent, based
solely on certificates from public officials, we confirm that the General
Partner is validly existing and in good standing under the laws of the State of
Delaware.

 

3.Each of the subsidiaries of the Company listed on Annex B hereto (the
“Material Subsidiaries”) has all requisite corporate, limited liability company
or partnership power and authority, as applicable, to own its properties and to
conduct its business in all material respects as its business is now being
conducted as described in the SEC Reports. With your consent, based solely on
certificates from public officials, we confirm that each of the Material
Subsidiaries is validly existing and in good standing under the laws of its
jurisdiction of incorporation or formation.

 

4.The execution and delivery by the Company, the Partnership and the General
Partner, as applicable, of the Operative Documents and the issuance by the
Company of the Preferred Shares to you do not, on the date hereof:

 

(i)result in the breach of or a default under any of the Specified Agreements;

 

(ii)violate any federal or New York statute, rule or regulation applicable to
the Company or the Delaware Laws; or

 

(iii)require any consents, approvals, or authorizations to be obtained by the
Company from, or any registrations, declarations or filings to be made by the
Company with, any governmental authority under any federal, New York statute,
rule or regulation applicable to the Company or the Delaware Laws on or prior to
the date hereof that have not been obtained or made.

 

5.The Company is not, and immediately after giving effect to the issuance of the
Preferred Shares in accordance with the Preferred Restructuring Agreement, will
not be required to be, registered as an “investment company” within the meaning
of the Investment Company Act of 1940, as amended.

 

6.Assuming the accuracy of the representations and warranties of the Company and
the Investors contained in the Preferred Restructuring Agreement, the issuance
of the Preferred Shares by the Company to the Investors solely in the manner
contemplated by the Preferred Restructuring Agreement, are exempt from the
registration requirements of the Securities Act. We express no opinion, however,
as to when or under what circumstances the Investors may reoffer or resell any
Preferred Shares.

 

7.Except as otherwise described in the Operative Documents, there are no
restrictions upon the voting or transfer of any Preferred Shares or shares of
common stock, no par value, of the Company issuable upon conversion of the
Preferred Shares in accordance with the Certificate of Designations pursuant to
the Specified Agreements.

  

Exhibit D

Preferred Restructuring Agreement

 

 

 

Exhibit E

 

Lead Investors GSO Equitable Finance LP          MTP Energy Opportunities Fund
II LLC MTP EOF II IP LLC MTP Energy Master Fund LLC Magnetar Structured Credit
Fund, LP Magnetar Constellation Fund V LLC Magnetar Longhorn Fund LP SERIES V, A
SERIES OF ASTRUM PARTNERS LLC BSOF Qmodem (M) 2 L.P. MTP Emerald Fund LLC
Investment Partners V (II), LLC GEPIF III EQM Holdings, L.P.

 

Exhibit E

Preferred Restructuring Agreement

 

 

 

Exhibit F

 

Form of Joinder Agreement

 

This Joinder Agreement is executed by the undersigned pursuant to the Preferred
Restructuring Agreement, dated as of February [●], 2020 (the “Agreement”), by
and among Equitrans Midstream Corporation, a Pennsylvania corporation (the
“Company”), EQM Midstream Partners, LP, a Delaware limited partnership (the
“Partnership”), and the investors party thereto (the “Investors”), which is
incorporated herein by reference. Capitalized terms used but not defined herein
shall have the meaning given to such terms in the Agreement. By the execution of
this Joinder Agreement, the undersigned agrees as follows:

 

1.The undersigned acknowledges that the undersigned is acquiring [·] Series A
Preferred Units, subject to the terms and conditions of the Agreement (including
the Schedules and Exhibits thereto).

 

2.The undersigned hereby joins in, and agrees to be bound by and subject to, the
Agreement, with the same force and effect as if the undersigned were originally
an Investor party thereto.

 

3.Any notice required or permitted by the Agreement shall be given to the
undersigned at the address listed below.

 

4.Each of the Company and the Partnership hereby acknowledge and agree that the
undersigned shall be deemed an Investor under the Agreement with respect to the
number of Series A Preferred Units set forth above and that such Investor shall
be entitled to all of the rights and benefits, and subject to all of the
obligations, of an Investor under the Agreement.

 

EXECUTED AND DATED as of this [·] day of [·], 2020.

 

    EQUITRANS MIDSTREAM CORPORATION                 By:  
                                    Name:         Title:                   EQM
MIDSTREAM PARTNERS, LP           By: EQGP Services, LLC, its general partner    
      By:       Name:       Title:               [JOINING PARTY]             By:
      Name:       Title:             Notice Address:              

 

Exhibit F

Preferred Restructuring Agreement