Item 1.01
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Entry into a Material Definitive Agreement.
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Purchase Agreement
On September 19, 2016, Sabine Pass Liquefaction, LLC (SPL), a wholly owned subsidiary of Cheniere Energy Partners, L.P. (Cheniere
Partners), entered into a Note Purchase Agreement (the Note Purchase Agreement) with the various purchasers named therein (the Purchasers), to issue and sell to the Purchasers $800 million aggregate principal
amount of its 5.00% Senior Secured Notes due 2037 (the Notes) in a private placement conducted pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the Securities Act). The Notes were issued by SPL on
February 24, 2017 (the Issue Date).
The Note Purchase Agreement contains customary representations, warranties and agreements by SPL and
customary indemnification obligations of SPL and the Purchasers.
The net proceeds from the Notes will be used by SPL to prepay all of the principal
amounts currently outstanding under its existing credit facilities and pay capital costs in connection with the construction of Trains 1 through 5 of the Sabine Pass liquefaction project.
The foregoing description of the Note Purchase Agreement is not complete and is qualified in its entirety by reference to the full text of the Note Purchase
Agreement, which is filed as Exhibit 1.1 hereto and is incorporated by reference herein.
Indenture
The Notes were issued on the Issue Date pursuant to the Indenture (the Indenture), dated as of February 24, 2017, by and between SPL, the
guarantors that may become party thereto from time to time and The Bank of New York Mellon, as Trustee (the Trustee), relating to the Notes.
Under the terms of the Indenture, the Notes have a final maturity date of September 15, 2037 and accrue interest at a rate equal to 5.00% per annum on
the principal amount from the Issue Date. The Notes are fully amortizing according to a fixed sculpted amortization schedule with semi-annual payments of principal and interest and have a weighted average life of 15.2 years. Amortization of the
Notes is deferred for the first approximately 8.6 years until 2025. Interest will be payable on March 15 and September 15 each year, beginning on September 15, 2017.
The Notes are senior secured obligations of SPL and rank senior in right of payment to any and all of SPLs future indebtedness that is subordinated in
right of payment to the Notes and equal in right of payment with all of SPLs existing and future indebtedness (including all loans under SPLs existing credit facilities, all obligations under SPLs senior working capital revolving
credit and letter of credit reimbursement agreement and all of SPLs outstanding senior secured notes) that is senior and secured by the same collateral securing the Notes. The Notes are effectively senior to all of SPLs senior
indebtedness that is unsecured to the extent of the value of the assets constituting the collateral securing the Notes.
As of the Issue Date, the Notes
were not guaranteed but will be guaranteed in the future by all of SPLs future restricted subsidiaries. Such guarantees will be joint and several obligations of the guarantors of the Notes. The guarantees of the Notes will be senior secured
obligations of the guarantors.
At any time or from time to time prior to March 15, 2037, SPL may redeem all or a part of the Notes, at a redemption
price equal to the optional redemption price set forth in the Indenture. SPL also may at any time on or after March 15, 2037, redeem the Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the
Notes to be redeemed, plus accrued and unpaid interest, if any, to the redemption date.
The Indenture also contains customary terms and events of default
and certain covenants that, among other things, limit SPLs ability and the ability of SPLs restricted subsidiaries to incur additional indebtedness or issue preferred stock,
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make certain investments or pay dividends or distributions on capital stock or subordinated indebtedness or purchase, redeem or retire capital stock, sell or transfer assets, including capital
stock of SPLs restricted subsidiaries, restrict dividends or other payments by restricted subsidiaries, incur liens, enter into transactions with affiliates, dissolve, liquidate, consolidate, merge, sell or lease all or substantially all of
SPLs assets and enter into certain LNG sales contracts. The Indenture covenants are subject to a number of important limitations and exceptions.
The foregoing description of the Indenture is qualified in its entirety by reference to the full text of the Indenture, which is filed as Exhibit 4.1 hereto,
and is incorporated by reference herein.