Item 2.01 Completion of Acquisition or Disposition of Assets.
On July 26, 2020, CNX Midstream Partners LP, a Delaware limited partnership (the
"Partnership"), CNX Midstream GP LLC, a Delaware limited liability company and
the general partner of the Partnership (the "General Partner"), CNX Resources
Corporation, a Delaware corporation ("CNX"), and CNX Resources Holdings LLC, a
Delaware limited liability company and a wholly owned subsidiary of CNX ("Merger
Sub"), entered into an Agreement and Plan of Merger (the "Merger Agreement"),
pursuant to which Merger Sub agreed to merge with and into the Partnership, with
the Partnership surviving as an indirect wholly owned subsidiary of CNX (the
"Merger").
On September 28, 2020, the parties to the Merger Agreement completed the Merger.
Pursuant to the Merger Agreement, at the effective time of the Merger (the
"Effective Time"), (i) each outstanding common unit representing a limited
partner interest in the Partnership (each, a "Partnership Common Unit") other
than Partnership Common Units owned by CNX and its subsidiaries (each, a "Public
Common Unit"), converted into the right to receive 0.88 shares of common stock,
par value $0.01 per share, of CNX (the "CNX Common Stock" and the shares of CNX
Common Stock issued in the Merger, the "Merger Consideration"); and (ii) (x)
each of the phantom units and any other awards issued under a Partnership
Long-Term Incentive Plan (each a "Partnership LTIP Award") (other than the
Director LTIP Awards (as defined below)), whether or not vested, that was
outstanding immediately prior to the Effective Time, ceased to relate to or
represent any right to receive Partnership Common Units and converted into an
equivalent award of restricted stock units relating to CNX Common Stock on the
same terms and conditions as were applicable to the corresponding Partnership
LTIP Award, including any applicable payment timing provisions and dividend
equivalent rights, as applicable, subject to the terms of the Merger Agreement
and (y) each Partnership LTIP Award held by a non-employee director whose
service to the Partnership or its affiliates terminated upon the consummation of
the Merger (each a "Director LTIP Award") and became fully vested and
automatically converted into the right to receive, with respect to each
Partnership Common Unit subject thereto, the Merger Consideration (plus any
accrued but unpaid amounts in relation to distribution equivalent rights).
Except for the Class B units representing limited partner interests in the
Partnership ("Class B units"), which were automatically be canceled immediately
prior to the Effective Time for no consideration in accordance with the Third
Amended and Restated Agreement of Limited Partnership of CNX Midstream Partners
LP, dated as of January 29, 2020, the interests in the Partnership owned by CNX
and its subsidiaries remain outstanding as limited partner interests in the
surviving entity. The General Partner continues to own the non-economic general
partner interest in the surviving entity.
Pursuant to the Merger Agreement, CNX issued approximately 37.1 million shares
of CNX Common Stock to the holders of Public Common Units as the Merger
Consideration as described above.
The Merger Agreement is filed as Exhibit 2.1 to the Partnership's Current Report
on Form 8-K filed with the Securities and Exchange Commission (the "SEC") on
July 27, 2020, which agreement is incorporated herein by reference. The
foregoing summary has been included to provide investors and security holders
with information regarding the terms of the Merger Agreement and is qualified in
its entirety by the terms and conditions of the Merger Agreement. It is not
intended to provide any other factual information about the Partnership, CNX or
their respective subsidiaries and affiliates.
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
To the extent applicable, the information included under Item 2.01 above is
incorporated into this Item 3.01 by reference.
In connection with the consummation of the Merger, the New York Stock Exchange
(the "NYSE") was notified that each outstanding Public Common Unit issued and
outstanding immediately prior to the Effective Time was converted, pursuant to
the Merger, into the right to receive the Merger Consideration, subject to the
terms and conditions of the Merger Agreement. The Partnership requested that the
NYSE file a notification of removal from listing on Form 25 with the SEC with
respect to the delisting of the Partnership Common Units from the NYSE and to
deregister the Partnership Common Units under Section 12(b) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). The Partnership Common
Units were suspended from trading on the NYSE prior to the opening of trading on
September 28, 2020.
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Item 3.03 Material Modification to Rights of Security Holders.
The information set forth under Item 2.01 and Item 3.01 is incorporated into
this Item 3.03 by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
In connection with the Merger, as of the Effective Time, Raymond T. Betler, John
E. Jackson and John A. Maher stepped down from their respective roles as members
of the Board of Directors of the General Partner (the "GP Board"). The decision
of each of Messrs. Betler, Jackson and Maher to step down as a member of the GP
Board was not the result of any disagreement with the General Partner or the
Partnership on any matter relating to the operations, policies or practices of
the General Partner or the Partnership, and was solely as a result of the
Merger.
In addition, as of the Effective Time, the number of members of the GP Board was
decreased from seven to four.
Item 5.07. Submission of Matters to a Vote of Security Holders.
As previously announced, the completion of the Merger was subject to, among
other things, approval of the Merger Agreement and the transactions contemplated
thereby, including the Merger, by the affirmative consent of the holders of a
majority of the outstanding Partnership Common Units and Class B units, voting
as a single class.
The GP Board set August 27, 2020 as the record date for determining the
Partnership limited partners entitled to execute and deliver written consents
approving the Merger Agreement and the transactions contemplated thereby,
including the Merger. On September 1, 2020, CNX Gas Company LLC, a Virginia
limited liability company and wholly owned subsidiary of CNX, and CNX Gas
Holdings, Inc., a Delaware corporation and wholly owned subsidiary of CNX, which
as of the record date collectively held 47,692,198 Partnership Common Units,
representing approximately 51.4% of the outstanding limited partner interests as
of the record date, delivered written consents approving the Merger Agreement
and the transactions contemplated thereby, including the Merger (the "CNX
Written Consents"). The delivery of the CNX Written Consents was sufficient to
approve the Merger Agreement and the transactions contemplated thereby,
including the Merger, without the receipt of written consent from any other
holder of Partnership limited partner interests.
The deadline for the consent solicitation expired at 11:59 p.m. (Eastern Time),
on September 25, 2020. A summary of the results for the proposal is set forth
below.
(1) Approval of the Merger Agreement and the transactions contemplated thereby,
including the Merger.
Consents For Consents Withheld Abstentions
61,736,428 3,167,149 92,310
Item 7.01 Regulation FD Disclosure.
On September 28, 2020, the Partnership and CNX issued a joint news release
announcing the completion of the Merger. A copy of the news release is furnished
as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by
reference into this Item 7.01.
The information set forth in this Item 7.01 and the attached Exhibit 99.1 shall
not be deemed "filed" for purposes of Section 18 of the Exchange Act.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description of the Exhibit
2.1* Agreement and Plan of Merger, dated as of July 26, 2020, by and
among CNX Resources Corporation, CNX Midstream Partners LP, CNX
Midstream GP LLC and CNX Resources Holdings LLC (incorporated by
reference to Exhibit 2.1 to the Partnership's Current Report on Form
8-K filed on July 27, 2020, File No. 36635).
10.1 Support Agreement, dated as of July 26, 2020, by and among CNX
Midstream Partners LP, CNX Gas Company LLC and CNX Gas Holdings, Inc.
(incorporated by reference to Exhibit 10.1 to the Partnership's
Current Report on Form 8-K filed on July 27, 2020, File No. 36635).
99.1 Press Release dated September 28, 2020.
104 The cover page from this Current Report on Form 8-K, formatted in
Inline XBRL
* The schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K
and will be provided to the Securities and Exchange Commission upon request.
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