It wasn’t hard to figure out the backers of the two sides in the proxy battle between independent producer EQT and dissidents known as the Rice Team Wednesday morning, at the long-awaited annual meeting.
Kallanish Energy was on hand for the meeting.
Body language and facial expressions for status quo EQT, represented by CEO Rob McNally, registered as tired. McNally et al. had fought for roughly nine months to convince shareholders his team’s efforts were the way to make EQT perform like one expects the U.S.’s largest natural gas producer, to perform.
Relaxed and loose
On the other side, the dissidents, the Rice Team, led by 37-year-old Toby Rice, looked relaxed, loose, Toby smiling, shaking hands, telling people he didn’t know “Hi, I’m Toby.”
At 8:02 a.m., McNally walked into the room, stood behind a podium, put his glasses on the bridge of his nose and, in a low voice, explained the rules for what he knew would be his first – and last – annual meeting as EQT CEO.
Six minutes later, it was all over. McNally told the assembled a solid estimate of board voting indicated all seven Rice nominees were voted in, and the five EQT nominees approved by the Rice Team, also were given a thumbs-up.
Toby received lowest percentage of votes
The official filing with the Securities and Exchange Commission showed none of the EQT-nominated, Rice-supported board nominees received less than 97.30% of votes cast, while the lowest percentage of “for” votes of the Rice Team-nominated board nominees went to one Toby Rice (81.02% of votes cast).
McNally read from his script, thanked EQT employees and board for their hard work they all should be proud of. He wished the Rice Team, new board, roughly 800 EQT employees and shareholders continued success. And he exited as he had come into the meeting, head down, moving quickly. Probably back to his corner office to pack up whatever might be left.
Toby Rice stuck around, gladly accepting handshakes and backslaps of congratulations, holding court with a handful of reporters. Rice is a smart guy. He knows his backers, current and future, now will step back, arms crossed on their collective chest, to see if he can accomplish everything he promised he would do with EQT,making it an industry leader, known for its innovation and the use of the highest of high technology — like the former Rice Energy was.
Additional free cash flow
He’s promised $500 million in additional free cash flow annually if his board and he were put in place. “We need to get down to $735 a foot (in drilling costs), and we will make progress in reaching that number over the next six months,” Rice said to reporters following the six-minute EQT annual meeting.
The new EQT will concentrate on its Pennsylvania Marcellus Shale assets, Toby said, as that area is the most economic to drill.
Toby, who was named to the American Baseball Coaches Association’s All-America Third Team in 2004 as a right fielder at Florida’s Rollins College, said “The clock starts on our 100-day plan as soon as today. By 2020 we want to have our foundational elements set up, best practices in place and then you’ll start to see the effects of large-scale development by mid-2021.”
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