Item 1.01 Entry into a Material Definitive Agreement.
Purchase Agreement
On September 19, 2016, Sabine
Pass Liquefaction, LLC (SPL), a wholly owned subsidiary of Cheniere Energy Partners, L.P. (the Partnership), entered into a Purchase Agreement (the Purchase Agreement) with Merrill Lynch, Pierce, Fenner &
Smith Incorporated, as representative of the initial purchasers named therein (the Initial Purchasers), to issue and sell to the Initial Purchasers $1.5 billion aggregate principal amount of its 5.00% Senior Secured Notes due 2027 (the
Notes).
The Purchase Agreement contains customary representations, warranties and agreements by SPL and customary conditions to closing and
indemnification obligations of SPL and the Initial Purchasers. The foregoing description of the Purchase Agreement is not complete and is qualified in its entirety by reference to the full text of the Purchase Agreement, which is filed as Exhibit
1.1 hereto and is incorporated by reference herein.
On September 23, 2016 (the Issue Date), SPL closed the sale of the Notes pursuant to the
Purchase Agreement. The sale of the Notes was not registered under the Securities Act of 1933, as amended (the Securities Act), and the Notes were sold on a private placement basis in reliance on Section 4(a)(2) of the Securities Act and
Rule 144A and Regulation S thereunder.
Certain Initial Purchasers and their affiliates have provided from time to time, and may provide in the future,
certain investment and commercial banking and financial advisory services to SPL and the Partnership in the ordinary course of business, for which they have received and may continue to receive customary fees and commissions.
Indentures
Eighth Supplemental Indenture
On September 19, 2016, SPL entered into an eighth supplemental indenture (the Eighth Supplemental Indenture) to the indenture, dated as of
February 1, 2013 (the Base Indenture, as supplemented by the First Supplemental Indenture, dated as of April 16, 2013, the Second Supplemental Indenture, dated as of April 16, 2013, the Third Supplemental Indenture, dated as of November
25, 2013, the Fourth Supplemental Indenture, dated as of May 20, 2014, the Fifth Supplemental Indenture, dated as of May 20, 2014, the Sixth Supplemental Indenture, dated as of March 3, 2015 and the Seventh Supplemental Indenture, dated as of June
14, 2016, the Indenture), by and among SPL, the guarantors that may become party thereto from time to time and The Bank of New York Mellon, as Trustee under the Indenture (the Trustee). The Eighth Supplemental Indenture was
effective immediately upon its execution by SPL and the Trustee and amends the Indenture to maintain certain existing covenants that were set to fall away once the notes received at least two investment grade credit ratings and modifies certain
existing covenants to provide SPL noteholders with additional protections. The amended covenants include the covenants limiting SPLs ability and the ability of SPLs restricted subsidiaries to: incur additional indebtedness or issue
preferred stock, sell or transfer assets, including capital stock of SPLs restricted subsidiaries, enter into transactions with affiliates, and dissolve, liquidate, consolidate, merge, sell or lease all or substantially all of SPLs
assets.
The foregoing description of the Eighth Supplemental Indenture is qualified in its entirety by reference to the full text of the Eighth
Supplemental Indenture, which is filed as Exhibit 4.1 hereto, and is incorporated by reference herein. The foregoing description of the Indenture is qualified in its entirety by reference to the full text of the Indenture, which is incorporated by
reference herein. A copy of the Base Indenture was filed as Exhibit 4.1 to the Current Report dated February 4, 2013, filed by the Partnership on Form 8-K.
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Ninth Supplemental Indenture
The Notes were issued on the Issue Date pursuant to the Base Indenture, as supplemented by the Eighth Supplemental Indenture and a ninth supplemental
indenture, dated as of the Issue Date, between SPL and the Trustee, relating to the Notes (the Ninth Supplemental Indenture). The Base Indenture as supplemented by the Eighth Supplemental Indenture and the Ninth Supplemental Indenture is
referred to herein as the Notes Indenture.
Under the terms of the Ninth Supplemental Indenture, the Notes will mature on March 15, 2027 and
will accrue interest at a rate equal to 5.00% per annum on the principal amount from the Issue Date, with such interest payable semi-annually, in cash in arrears, on March 15 and September 15 of each year, beginning on March 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 September 15, 2026, SPL may redeem all or a part of the Notes, at a
redemption price equal to the make-whole price set forth in the Ninth Supplemental Indenture, plus accrued and unpaid interest, if any, to the date of redemption. SPL also may at any time on or after September 15, 2026, 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 date of redemption.
General
The Notes 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, 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 Notes Indenture
covenants are subject to a number of important limitations and exceptions.
The foregoing description of the Ninth Supplemental Indenture is qualified in
its entirety by reference to the full text of the Ninth Supplemental Indenture, which is filed as Exhibit 4.2 hereto, and is incorporated by reference herein. The foregoing description of the Notes Indenture is qualified in its entirety by reference
to the full text of the Notes Indenture, which is incorporated by reference herein. A copy of the Base Indenture was filed as Exhibit 4.1 to the Current Report dated February 4, 2013, filed by the Partnership on Form 8-K.
Registration Rights Agreement
In connection with
the closing of the sale of the Notes, SPL and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the respective Initial Purchasers, entered into a Registration Rights Agreement dated the Issue Date (the Registration
Rights Agreement). Under the terms of the Registration Rights Agreement, SPL has agreed, and any future guarantors of the Notes will agree, to use commercially reasonable efforts to file with the U.S. Securities and Exchange Commission and
cause to become effective a registration statement with respect to an offer to exchange any and all of the
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Notes, for a like aggregate principal amount of debt securities of SPL issued under the Notes Indenture and identical in all material respects to the respective Notes sought to be exchanged
(other than with respect to restrictions on transfer or to any increase in annual interest rate), and that are registered under the Securities Act. SPL has agreed, and any future guarantors of the Notes will agree, to use commercially reasonable
efforts to cause such registration statement to become effective within 360 days after the Issue Date. Under specified circumstances, SPL has also agreed, and any future guarantors will also agree, to use commercially reasonable efforts to cause to
become effective a shelf registration statement relating to resales of the Notes. SPL will be obligated to pay additional interest if it fails to comply with its obligations to register the Notes within the specified time periods.
This description of the Registration Rights Agreement is qualified in its entirety by reference to the full text of the Registration Rights Agreement, a copy
of which is filed as Exhibit 10.1 hereto and is incorporated by reference herein.