|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
Delaware
|
95-4352386
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
|
700 Milam Street, Suite 800
|
|
Houston, Texas
|
77002
|
(Address of principal executive offices)
|
(Zip code)
|
|
|
|
|
|
Large accelerated filer
x
|
Accelerated filer
¨
|
|||||
Non-accelerated filer
¨
|
Smaller reporting company
¨
|
|||||
(Do not check if a smaller reporting company)
|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Revenues
|
|
|
|
||||
LNG terminal revenues
|
$
|
66,419
|
|
|
$
|
66,061
|
|
Marketing and trading revenues (losses)
|
657
|
|
|
(565
|
)
|
||
Other
|
474
|
|
|
410
|
|
||
Total revenues
|
67,550
|
|
|
65,906
|
|
||
|
|
|
|
||||
Operating costs and expenses
|
|
|
|
||||
General and administrative expense
|
73,808
|
|
|
85,798
|
|
||
Depreciation, depletion and amortization
|
15,475
|
|
|
15,113
|
|
||
LNG terminal operating expense
|
13,687
|
|
|
15,259
|
|
||
LNG terminal development expense
|
12,112
|
|
|
17,088
|
|
||
Other
|
80
|
|
|
102
|
|
||
Total operating costs and expenses
|
115,162
|
|
|
133,360
|
|
||
Loss from operations
|
(47,612
|
)
|
|
(67,454
|
)
|
||
|
|
|
|
||||
Other income (expense)
|
|
|
|
||||
Interest expense, net
|
(40,270
|
)
|
|
(40,262
|
)
|
||
Derivative loss, net
|
(34,681
|
)
|
|
(17,468
|
)
|
||
Other income
|
310
|
|
|
475
|
|
||
Total other expense
|
(74,641
|
)
|
|
(57,255
|
)
|
||
Loss before income taxes and non-controlling interest
|
(122,253
|
)
|
|
(124,709
|
)
|
||
Income tax benefit (provision)
|
(92
|
)
|
|
80
|
|
||
Net loss
|
(122,345
|
)
|
|
(124,629
|
)
|
||
Less: net loss attributable to non-controlling interest
|
(24,535
|
)
|
|
(7,524
|
)
|
||
Net loss attributable to common stockholders
|
$
|
(97,810
|
)
|
|
$
|
(117,105
|
)
|
|
|
|
|
||||
Net loss per share attributable to common stockholders—basic and diluted
|
$
|
(0.44
|
)
|
|
$
|
(0.54
|
)
|
Weighted average number of common shares outstanding—basic and diluted
|
223,207
|
|
|
215,634
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Net loss
|
$
|
(122,345
|
)
|
|
$
|
(124,629
|
)
|
Other comprehensive income (loss)
|
|
|
|
||||
Interest rate cash flow hedges
|
|
|
|
||||
Loss on settlements retained in other comprehensive income
|
—
|
|
|
(30
|
)
|
||
Change in fair value of interest rate cash flow hedges
|
—
|
|
|
21,297
|
|
||
Foreign currency translation
|
—
|
|
|
(40
|
)
|
||
Total other comprehensive income
|
—
|
|
|
21,227
|
|
||
Comprehensive loss
|
(122,345
|
)
|
|
(103,402
|
)
|
||
Less: comprehensive loss attributable to non-controlling interest
|
(24,535
|
)
|
|
(6,844
|
)
|
||
Comprehensive loss attributable to common stockholders
|
$
|
(97,810
|
)
|
|
$
|
(96,558
|
)
|
|
Total Stockholders' Equity
|
|
|
|
|
||||||||||||||||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Non- controlling Interest
|
|
Total
Equity
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|||||||||||||||||||||
Balance—December 31, 2013
|
238,091
|
|
|
$
|
716
|
|
|
8,970
|
|
|
$
|
(179,826
|
)
|
|
$
|
2,459,699
|
|
|
$
|
(2,100,907
|
)
|
|
$
|
—
|
|
|
$
|
2,660,375
|
|
|
$
|
2,840,057
|
|
Exercise of stock options
|
114
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,691
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,691
|
|
|||||||
Issuances of restricted stock
|
163
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Forfeitures of restricted stock
|
(554
|
)
|
|
(2
|
)
|
|
59
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock-based compensation
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
37,698
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,698
|
|
|||||||
Shares repurchased related to tax withholdings for stock-based compensation
|
(153
|
)
|
|
—
|
|
|
153
|
|
|
(7,742
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,742
|
)
|
|||||||
Excess tax benefit from stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43
|
|
|||||||
Loss attributable to non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,535
|
)
|
|
(24,535
|
)
|
|||||||
Distribution to non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,786
|
)
|
|
(19,786
|
)
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(97,810
|
)
|
|
—
|
|
|
—
|
|
|
(97,810
|
)
|
|||||||
Balance—March 31, 2014
|
237,661
|
|
|
$
|
714
|
|
|
9,182
|
|
|
$
|
(187,568
|
)
|
|
$
|
2,501,133
|
|
|
$
|
(2,198,717
|
)
|
|
$
|
—
|
|
|
$
|
2,616,054
|
|
|
$
|
2,731,616
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net loss
|
$
|
(97,810
|
)
|
|
$
|
(117,105
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Investment in restricted cash and cash equivalents for certain operating activities
|
(16,329
|
)
|
|
(33,850
|
)
|
||
Depreciation, depletion and amortization
|
15,475
|
|
|
15,113
|
|
||
Amortization of debt issuance costs and discount
|
2,217
|
|
|
2,209
|
|
||
Stock-based compensation
|
35,942
|
|
|
63,689
|
|
||
Non-cash derivative loss, net
|
32,854
|
|
|
18,123
|
|
||
Net loss attributable to non-controlling interest
|
(24,535
|
)
|
|
(7,524
|
)
|
||
Other
|
1,006
|
|
|
(2,828
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts and interest receivable
|
600
|
|
|
953
|
|
||
Accounts payable and accrued liabilities
|
43,379
|
|
|
49,631
|
|
||
LNG inventory
|
3,001
|
|
|
2,440
|
|
||
Deferred revenue
|
(830
|
)
|
|
(2,210
|
)
|
||
Prepaid expenses and other
|
(13,189
|
)
|
|
(1,860
|
)
|
||
Net cash used in operating activities
|
(18,219
|
)
|
|
(13,219
|
)
|
||
|
|
|
|
||||
Cash flows from investing activities
|
|
|
|
||||
Property, plant and equipment, net
|
(773,376
|
)
|
|
(464,608
|
)
|
||
Use of restricted cash and cash equivalents for the acquisition of property, plant and equipment
|
761,858
|
|
|
463,617
|
|
||
Investment in Cheniere Partners
|
—
|
|
|
(7,449
|
)
|
||
Other
|
(12,495
|
)
|
|
(1,551
|
)
|
||
Net cash used in investing activities
|
(24,013
|
)
|
|
(9,991
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities
|
|
|
|
||||
Proceeds from issuances of long-term debt
|
—
|
|
|
1,500,000
|
|
||
Proceeds from sale of common units by Cheniere Partners
|
—
|
|
|
365,000
|
|
||
Use of (investment in) restricted cash and cash equivalents
|
33,743
|
|
|
(1,818,313
|
)
|
||
Debt issuance and deferred financing costs
|
(13,957
|
)
|
|
(34,986
|
)
|
||
Distributions to non-controlling interest
|
(19,786
|
)
|
|
(11,698
|
)
|
||
Payments related to tax withholdings for stock-based compensation
|
(7,742
|
)
|
|
(460
|
)
|
||
Proceeds from exercise of stock options
|
3,691
|
|
|
—
|
|
||
Other
|
44
|
|
|
(3
|
)
|
||
Net cash used in financing activities
|
(4,007
|
)
|
|
(460
|
)
|
||
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
(46,239
|
)
|
|
(23,670
|
)
|
||
Cash and cash equivalents—beginning of period
|
960,842
|
|
|
201,711
|
|
||
Cash and cash equivalents—end of period
|
$
|
914,603
|
|
|
$
|
178,041
|
|
|
March 31,
|
|
December 31,
|
||||
|
2014
|
|
2013
|
||||
LNG terminal costs
|
|
|
|
||||
LNG terminal
|
$
|
2,241,880
|
|
|
$
|
2,234,796
|
|
LNG terminal construction-in-process
|
5,141,488
|
|
|
4,489,668
|
|
||
LNG site and related costs, net
|
6,509
|
|
|
6,511
|
|
||
Accumulated depreciation
|
(306,802
|
)
|
|
(292,434
|
)
|
||
Total LNG terminal costs, net
|
7,083,075
|
|
|
6,438,541
|
|
||
|
|
|
|
||||
Fixed assets and other
|
|
|
|
|
|
||
Computer and office equipment
|
3,327
|
|
|
8,115
|
|
||
Furniture and fixtures
|
4,322
|
|
|
4,319
|
|
||
Computer software
|
10,955
|
|
|
13,504
|
|
||
Leasehold improvements
|
7,314
|
|
|
7,303
|
|
||
Other
|
49,411
|
|
|
15,388
|
|
||
Accumulated depreciation
|
(26,363
|
)
|
|
(32,771
|
)
|
||
Total fixed assets, net
|
48,966
|
|
|
15,858
|
|
||
Property, plant and equipment, net
|
$
|
7,132,041
|
|
|
$
|
6,454,399
|
|
Non-controlling interest at December 31, 2013
|
$
|
2,660,375
|
|
Distributions to Cheniere Partners' non-controlling interest
|
(19,174
|
)
|
|
Dividends to Cheniere Holdings' non-controlling interest
|
(612
|
)
|
|
Net loss attributable to non-controlling interest
|
(24,535
|
)
|
|
Non-controlling interest at March 31, 2014
|
$
|
2,616,054
|
|
|
|
March 31,
|
|
December 31,
|
||||
|
|
2014
|
|
2013
|
||||
Accrued interest expense and related fees
|
|
$
|
101,637
|
|
|
$
|
80,151
|
|
Payroll
|
|
14,712
|
|
|
7,410
|
|
||
LNG liquefaction costs
|
|
18,539
|
|
|
83,651
|
|
||
LNG terminal costs
|
|
1,612
|
|
|
1,612
|
|
||
Other accrued liabilities
|
|
5,775
|
|
|
13,728
|
|
||
Total accrued liabilities
|
|
$
|
142,275
|
|
|
$
|
186,552
|
|
|
|
March 31,
|
|
December 31,
|
||||
|
|
2014
|
|
2013
|
||||
Long-term debt
|
|
|
|
|
||||
2016 Notes
|
|
$
|
1,665,500
|
|
|
$
|
1,665,500
|
|
2020 Notes
|
|
420,000
|
|
|
420,000
|
|
||
2021 Sabine Pass Liquefaction Senior Notes
|
|
2,000,000
|
|
|
2,000,000
|
|
||
2022 Sabine Pass Liquefaction Senior Notes
|
|
1,000,000
|
|
|
1,000,000
|
|
||
2023 Sabine Pass Liquefaction Senior Notes
|
|
1,000,000
|
|
|
1,000,000
|
|
||
2013 Liquefaction Credit Facilities
|
|
100,000
|
|
|
100,000
|
|
||
CTPL Credit Facility
|
|
400,000
|
|
|
400,000
|
|
||
Total long-term debt
|
|
6,585,500
|
|
|
6,585,500
|
|
||
|
|
|
|
|
||||
Long-term debt premium (discount)
|
|
|
|
|
|
|
||
2016 Notes
|
|
(12,519
|
)
|
|
(13,693
|
)
|
||
2021 Sabine Pass Liquefaction Senior Notes
|
|
11,222
|
|
|
11,562
|
|
||
CTPL Credit Facility
|
|
(5,853
|
)
|
|
(7,096
|
)
|
||
Total long-term debt, net of discount
|
|
$
|
6,578,350
|
|
|
$
|
6,576,273
|
|
•
|
1.0%
of the principal amount of the 2016 Notes; or
|
•
|
the excess of: a) the present value at such redemption date of (i) the redemption price of the 2016 Notes plus (ii) all required interest payments due on the 2016 Notes (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus
50
basis points; over b) the principal amount of the 2016 Notes, if greater.
|
|
Fair Value Measurements as of
|
||||||||||||||||||||||||||||||
|
March 31, 2014
|
|
December 31, 2013
|
||||||||||||||||||||||||||||
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Total
|
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Total
|
||||||||||||||||
LNG Inventory Derivatives liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(171
|
)
|
|
$
|
—
|
|
|
$
|
(171
|
)
|
Fuel Derivatives asset
|
—
|
|
|
283
|
|
|
—
|
|
|
283
|
|
|
—
|
|
|
126
|
|
|
—
|
|
|
126
|
|
||||||||
Interest Rate Derivatives asset
|
—
|
|
|
51,626
|
|
|
—
|
|
|
51,626
|
|
|
—
|
|
|
84,639
|
|
|
—
|
|
|
84,639
|
|
|
|
|
|
Fair Value Measurements as of
|
||||||
|
Balance Sheet Location
|
|
March 31, 2014
|
|
December 31, 2013
|
|||||
LNG Inventory Derivatives asset (liability)
|
Prepaid expenses and other
|
|
$
|
—
|
|
|
$
|
(171
|
)
|
|
Fuel Derivatives asset
|
Prepaid expenses and other
|
|
283
|
|
|
126
|
|
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
LNG Inventory Derivatives gain (loss)
|
$
|
184
|
|
|
$
|
(524
|
)
|
Fuel Derivatives gain
|
165
|
|
|
—
|
|
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
LNG Inventory Derivatives loss
|
$
|
(435
|
)
|
|
$
|
—
|
|
Fuel Derivatives gain
|
242
|
|
|
515
|
|
|
|
Initial Notional Amount
|
|
Maximum Notional Amount
|
|
Effective Date
|
|
Maturity Date
|
|
Weighted Average Fixed Interest Rate Paid
|
|
Variable Interest Rate Received
|
Interest Rate Derivatives - Not Designated
|
|
$20.0 million
|
|
$2.9 billion
|
|
August 14, 2012
|
|
July 31, 2019
|
|
1.98%
|
|
One-month LIBOR
|
Interest Rate Derivatives - Not Designated
|
|
—
|
|
$671.0 million
|
|
June 5, 2013
|
|
May 28, 2020
|
|
2.05%
|
|
One-month LIBOR
|
|
|
|
|
Fair Value Measurements as of
|
||||||
|
|
Balance Sheet Location
|
|
March 31, 2014
|
|
December 31, 2013
|
||||
Interest Rate Derivatives - Not Designated
|
|
Non-current derivative assets
|
|
$
|
71,170
|
|
|
$
|
98,123
|
|
Interest Rate Derivatives - Not Designated
|
|
Other current liabilities
|
|
(19,544
|
)
|
|
(13,484
|
)
|
|
Gain (Loss) in Other Comprehensive Income
|
|
Gain (Loss) Reclassified from AOCI into Interest Expense (Effective Portion)
|
|
Losses Reclassified into Earnings as a Result of Discontinuance of Cash Flow Hedge Accounting
|
||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||
Interest Rate Derivatives - Designated
|
$
|
—
|
|
|
$
|
21,297
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest Rate Derivatives - Settlements
|
—
|
|
|
(30
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
Interest Rate Derivatives - Not Designated loss
|
$
|
(34,479
|
)
|
|
$
|
(17,983
|
)
|
|
|
Gross Amounts Recognized
|
|
Gross Amounts Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented in the Consolidated Balance Sheets
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheets
|
|
|
||||||||||||||
Offsetting Derivative Assets (Liabilities)
|
|
|
|
|
Derivative Instrument
|
|
Cash Collateral Received (Paid)
|
|
Net Amount
|
|||||||||||||||
As of March 31, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fuel Derivatives
|
|
$
|
283
|
|
|
$
|
—
|
|
|
$
|
283
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
283
|
|
LNG Inventory Derivatives
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest Rate Derivatives - Not Designated
|
|
71,170
|
|
|
—
|
|
|
71,170
|
|
|
—
|
|
|
—
|
|
|
71,170
|
|
||||||
Interest Rate Derivatives - Not Designated
|
|
(19,544
|
)
|
|
—
|
|
|
(19,544
|
)
|
|
—
|
|
|
—
|
|
|
(19,544
|
)
|
||||||
As of December 31, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fuel Derivatives
|
|
126
|
|
|
—
|
|
|
126
|
|
|
—
|
|
|
—
|
|
|
126
|
|
||||||
LNG Inventory Derivatives
|
|
(171
|
)
|
|
(171
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest Rate Derivatives - Designated
|
|
98,123
|
|
|
—
|
|
|
98,123
|
|
|
—
|
|
|
—
|
|
|
98,123
|
|
||||||
Interest Rate Derivatives - Not Designated
|
|
(13,484
|
)
|
|
—
|
|
|
(13,484
|
)
|
|
—
|
|
|
—
|
|
|
(13,484
|
)
|
|
|
March 31, 2014
|
|
December 31, 2013
|
||||||||||||
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
||||||||
2016 Notes, net of discount (1)
|
|
$
|
1,652,981
|
|
|
$
|
1,824,478
|
|
|
$
|
1,651,807
|
|
|
$
|
1,868,607
|
|
2020 Notes (1)
|
|
420,000
|
|
|
441,000
|
|
|
420,000
|
|
|
432,600
|
|
||||
2021 Sabine Pass Liquefaction Senior Notes (1)
|
|
2,011,222
|
|
|
2,079,101
|
|
|
2,011,562
|
|
|
1,961,273
|
|
||||
2022 Sabine Pass Liquefaction Senior Notes (1)
|
|
1,000,000
|
|
|
1,042,500
|
|
|
1,000,000
|
|
|
982,500
|
|
||||
2023 Sabine Pass Liquefaction Senior Notes (1)
|
|
1,000,000
|
|
|
997,500
|
|
|
1,000,000
|
|
|
935,000
|
|
||||
2013 Liquefaction Credit Facilities (2)
|
|
100,000
|
|
|
100,000
|
|
|
100,000
|
|
|
100,000
|
|
||||
CTPL Credit Facility (3)
|
|
394,147
|
|
|
400,000
|
|
|
392,904
|
|
|
400,000
|
|
|
(1)
|
The Level 2 estimated fair value was based on quotations obtained from broker-dealers who make markets in these and similar instruments based on the closing trading prices on
March 31, 2014
and
December 31, 2013
, as applicable.
|
(2)
|
The Level 3 estimated fair value approximates the carrying amount because the interest rates are variable and reflective of market rates and Sabine Pass Liquefaction has the ability to call this debt at any time without penalty.
|
(3)
|
The Level 3 estimated fair value approximates the principal amount because the interest rates are variable and reflective of market rates and CTPL has the ability to call this debt at any time without penalty.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Weighted average common shares outstanding:
|
|
|
|
||||
Basic
|
223,207
|
|
|
215,634
|
|
||
Dilutive common stock options (1)
|
—
|
|
|
—
|
|
||
Diluted
|
223,207
|
|
|
215,634
|
|
||
|
|
|
|
||||
Basic and diluted net loss per share attributable to common stockholders
|
$
|
(0.44
|
)
|
|
$
|
(0.54
|
)
|
|
(1)
|
Stock options and unvested stock of
14.5 million
shares and
18.6 million
shares for the
three months ended March 31, 2014
and
2013
, respectively, representing securities that could potentially dilute basic EPS in the future were not included in the diluted net loss per share computations because their effect would have been anti-dilutive.
|
•
|
35%
when NTP is issued;
|
•
|
10%
on the first anniversary of the issuance of NTP;
|
•
|
15%
on the second anniversary of the issuance of NTP;
|
•
|
15%
on the third anniversary of the issuance of NTP; and
|
•
|
25%
on the fourth anniversary of the issuance of NTP.
|
•
|
20%
upon payment of
60%
of the original contract price of the EPC Contract (Train 3 and Train 4);
|
•
|
20%
upon substantial completion, as defined in the EPC Contract (Trains 3 and 4), of Train 4 of the Sabine Pass Liquefaction Project; and
|
•
|
30%
on the first anniversary of substantial completion of Train 4 of the Sabine Pass Liquefaction Project.
|
|
Segments
|
||||||||||||||
|
LNG Terminal
|
|
LNG & Natural Gas Marketing
|
|
Corporate and Other (1)
|
|
Total
Consolidation
|
||||||||
As of or for the Three Months Ended March 31, 2014
|
|
|
|
|
|
|
|
||||||||
Revenues (losses) (2)
|
$
|
67,191
|
|
|
$
|
2,832
|
|
|
$
|
(2,473
|
)
|
|
$
|
67,550
|
|
Intersegment revenues (losses) (3) (4)
|
772
|
|
|
2,174
|
|
|
(2,946
|
)
|
|
—
|
|
||||
Depreciation, depletion and amortization
|
14,406
|
|
|
152
|
|
|
917
|
|
|
15,475
|
|
||||
Loss from operations
|
(7,516
|
)
|
|
(11,594
|
)
|
|
(28,502
|
)
|
|
(47,612
|
)
|
||||
Interest expense, net
|
(40,373
|
)
|
|
—
|
|
|
103
|
|
|
(40,270
|
)
|
||||
Loss before income taxes and non-controlling interest (5)
|
(77,354
|
)
|
|
(11,727
|
)
|
|
(33,172
|
)
|
|
(122,253
|
)
|
||||
Stock-based compensation
|
3,050
|
|
|
6,510
|
|
|
28,138
|
|
|
37,698
|
|
||||
Goodwill
|
76,819
|
|
|
—
|
|
|
—
|
|
|
76,819
|
|
||||
Total assets
|
8,520,986
|
|
|
62,955
|
|
|
940,675
|
|
|
9,524,616
|
|
||||
Expenditures for additions to long-lived assets
|
659,779
|
|
|
314
|
|
|
25,911
|
|
|
686,004
|
|
||||
|
|
|
|
|
|
|
|
||||||||
As of or for the Three Months Ended March 31, 2013
|
|
|
|
|
|
|
|
||||||||
Revenues (losses) (2)
|
$
|
66,630
|
|
|
$
|
(1,157
|
)
|
|
$
|
433
|
|
|
$
|
65,906
|
|
Intersegment revenues (losses) (3) (4)
|
569
|
|
|
(592
|
)
|
|
23
|
|
|
—
|
|
||||
Depreciation, depletion and amortization
|
14,380
|
|
|
249
|
|
|
484
|
|
|
15,113
|
|
||||
Loss from operations
|
(5,824
|
)
|
|
(20,667
|
)
|
|
(40,963
|
)
|
|
(67,454
|
)
|
||||
Interest expense, net
|
(51,916
|
)
|
|
—
|
|
|
11,654
|
|
|
(40,262
|
)
|
||||
Loss before income taxes and non-controlling interest (5)
|
(74,882
|
)
|
|
(20,656
|
)
|
|
(29,171
|
)
|
|
(124,709
|
)
|
||||
Stock-based compensation
|
6,288
|
|
|
11,063
|
|
|
48,661
|
|
|
66,012
|
|
||||
Goodwill
|
76,819
|
|
|
—
|
|
|
—
|
|
|
76,819
|
|
||||
Total assets
|
6,377,204
|
|
|
59,703
|
|
|
144,912
|
|
|
6,581,819
|
|
||||
Expenditures for additions to long-lived assets
|
556,575
|
|
|
—
|
|
|
607
|
|
|
557,182
|
|
|
(1)
|
Includes corporate activities, oil and gas exploration, development and exploitation, strategic activities and certain intercompany eliminations. These activities have been included in the corporate and other column due to the lack of a material impact that these activities have on our consolidated financial statements.
|
(2)
|
Substantially all of the LNG terminal revenues relate to regasification capacity reservation fee payments made by Total Gas & Power North America, Inc. and Chevron U.S.A. Inc. LNG and natural gas marketing and trading revenue consists primarily of the domestic marketing of natural gas imported into the Sabine Pass LNG terminal and international revenue allocations using a cost plus transfer pricing methodology.
|
(3)
|
Intersegment revenues primarily related to our LNG terminal segment are from tug revenues from Cheniere Marketing. These LNG terminal segment intersegment revenues are eliminated with intersegment losses in our Consolidated Statements of Operations.
|
(4)
|
Intersegment revenues (losses) related to our LNG and natural gas marketing segment are primarily a result of international revenue allocations using a cost plus transfer pricing methodology and from Cheniere Marketing's tug costs. These LNG and natural gas marketing segment intersegment revenues (losses) are eliminated with intersegment revenues (losses) in our Consolidated Statements of Operations.
|
(5)
|
Items to reconcile loss from operations and loss before income taxes and non-controlling interest include consolidated other income (expense) amounts as presented on our Consolidated Statements of Operations primarily related to our LNG terminal segment.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Cash paid during the year for interest, net of amounts capitalized and deferred
|
|
$
|
16,567
|
|
|
$
|
—
|
|
LNG terminal costs funded with accounts payable and accrued liabilities
|
|
66,241
|
|
|
180,084
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
statements that we expect to commence or complete construction of our proposed liquefied natural gas ("LNG") terminals, liquefaction facilities, pipeline facilities or other projects, or any expansions thereof, by certain dates, or at all;
|
•
|
statements regarding future levels of domestic and international natural gas production, supply or consumption or future levels of LNG imports into or exports from North America and other countries worldwide or purchases of natural gas, regardless of the source of such information, or the transportation or other infrastructure or demand for and prices related to natural gas, LNG or other hydrocarbon products;
|
•
|
statements regarding any financing transactions or arrangements, or ability to enter into such transactions;
|
•
|
statements relating to the construction of our natural gas liquefaction trains ("Trains"), including statements concerning the engagement of any engineering, procurement and construction ("EPC") contractor or other contractor and the anticipated terms and provisions of any agreement with any EPC or other contractor, and anticipated costs related thereto;
|
•
|
statements regarding any agreement to be entered into or performed substantially in the future, including any revenues anticipated to be received and the anticipated timing thereof, and statements regarding the amounts of total LNG regasification, liquefaction or storage capacities that are, or may become, subject to contracts;
|
•
|
statements regarding counterparties to our commercial contracts, construction contracts and other contracts;
|
•
|
statements regarding our planned construction of additional Trains, including the financing of such Trains;
|
•
|
statements that our Trains, when completed, will have certain characteristics, including amounts of liquefaction capacities;
|
•
|
statements regarding our business strategy, our strengths, our business and operation plans or any other plans, forecasts, projections or objectives, including anticipated revenues and capital expenditures, any or all of which are subject to change;
|
•
|
statements regarding legislative, governmental, regulatory, administrative or other public body actions, approvals, requirements, permits, applications, filings, investigations, proceedings or decisions;
|
•
|
statements regarding our anticipated LNG and natural gas marketing activities; and
|
•
|
any other statements that relate to non-historica
l or future information.
|
•
|
Overview of Business
|
•
|
Overview of Significant Events
|
•
|
Liquidity and Capital Resources
|
•
|
Results of Operations
|
•
|
Off-Balance Sheet Arrangements
|
•
|
Summary of Critical Accounting Estimates
|
•
|
Recent Accounting Standards
|
•
|
In April 2014, our wholly owned subsidiary, Corpus Christi Liquefaction, LLC ("Corpus Christi Liquefaction"), entered into two SPAs with Endesa S.A. ("Endesa") under which Endesa has agreed to purchase a total of 117.3 million MMBtu of LNG per year (approximately 2.25 mtpa) upon the commencement of operations from the Corpus Christi Liquefaction Project.
|
•
|
In April 2014, Sabine Pass Liquefaction entered into a $325.0 million senior letter of credit and reimbursement agreement (the "Sabine Pass Liquefaction LC Agreement") that it intends to use for the issuance of letters of credit on behalf of Sabine Pass Liquefaction for certain working capital requirements related to the Sabine Pass Liquefaction Project.
|
•
|
$1.7 billion of 7.50% Senior Secured Notes due 2016 issued by Sabine Pass LNG (the "2016 Notes");
|
•
|
$0.4 billion of 6.50% Senior Secured Notes due 2020 issued by Sabine Pass LNG (the "2020 Notes" and collectively with the 2016 Notes, the "Sabine Pass LNG Senior Notes");
|
•
|
$2.0 billion of 5.625% Senior Secured Notes due 2021 (the "2021 Sabine Pass Liquefaction Senior Notes");
|
•
|
$1.0 billion of 6.250% Senior Secured Notes due 2022 (the "2022 Sabine Pass Liquefaction Senior Notes"); and
|
•
|
$1.0 billion of 5.625% Senior Secured Notes due 2023 (the "2023 Sabine Pass Liquefaction Senior Notes") (collectively with the 2021 Sabine Pass Liquefaction Senior Notes and the 2022 Sabine Pass Liquefaction Senior Notes, the "Sabine Pass Liquefaction Senior Notes").
|
•
|
the excess of: a) the present value at such redemption date of (i) the redemption price of the 2016 Notes plus (ii) all required interest payments due on the 2016 Notes (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over b) the principal amount of the 2016 Notes, if greater.
|
•
|
the right to deliver cargoes to the Sabine Pass LNG terminal during the construction of the Sabine Pass Liquefaction Project in exchange for payment of 80% of the expected gross margin from each cargo to Cheniere Energy Investments, LLC ("Cheniere Investments"), a wholly owned subsidiary of Cheniere Partners;
|
•
|
the Cheniere Marketing SPA, with the right to purchase, at Cheniere Marketing's option, up to 104,000,000 MMBtu/yr of LNG from Sabine Pass Liquefaction, to the extent Sabine Pass Liquefaction is able to produce LNG in excess of that required for other customers: Cheniere Marketing may purchase LNG at a price of 115% of Henry Hub plus up to $3.00 per MMBtu for the most profitable 36,000,000 MMBtu of cargoes sold each year by Cheniere Marketing; and then 20% of net profits of the remaining 68,000,000 MMBtu sold each year by Cheniere Marketing; and
|
•
|
three LNG vessel time charters with subsidiaries of two ship owners, Dynagas, Ltd. ("Dynagas") and Teekay LNG Operating LLC ("Teekay"). The annual payments for the vessel charters are approximately $92 million. The charters have an initial term of 5 years with the option to renew with Dynagas for a 2-year extension with similar terms as the initial term. Cheniere Marketing expects to receive delivery of the vessel from Dynagas in June 2015 and the vessels from Teekay in January 2016 and June 2016.
|
|
Three Months Ended March 31,
|
||||||
|
2014
|
|
2013
|
||||
Sources of cash and cash equivalents
|
|
|
|
||||
Use of restricted cash and cash equivalents
|
$
|
795,601
|
|
|
$
|
463,617
|
|
Proceeds from exercise of stock options
|
3,691
|
|
|
—
|
|
||
Proceeds from issuances of long-term debt
|
—
|
|
|
1,500,000
|
|
||
Proceeds from sale of common units by Cheniere Partners
|
—
|
|
|
365,000
|
|
||
Other
|
44
|
|
|
—
|
|
||
Total sources of cash and cash equivalents
|
799,336
|
|
|
2,328,617
|
|
||
|
|
|
|
||||
Uses of cash and cash equivalents
|
|
|
|
|
|
||
Property, plant and equipment, net
|
(773,376
|
)
|
|
(464,608
|
)
|
||
Distributions to non-controlling interest
|
(19,786
|
)
|
|
(11,698
|
)
|
||
Operating cash flow
|
(18,219
|
)
|
|
(13,219
|
)
|
||
Debt issuance and deferred financing costs
|
(13,957
|
)
|
|
(34,986
|
)
|
||
Payments related to tax withholdings for stock-based compensation
|
(7,742
|
)
|
|
(460
|
)
|
||
Investment in restricted cash and cash equivalents
|
—
|
|
|
(1,818,313
|
)
|
||
Investment in Cheniere Partners
|
—
|
|
|
(7,449
|
)
|
||
Other
|
(12,495
|
)
|
|
(1,554
|
)
|
||
Total uses of cash and cash equivalents
|
(845,575
|
)
|
|
(2,352,287
|
)
|
||
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
(46,239
|
)
|
|
(23,670
|
)
|
||
Cash and cash equivalents—beginning of period
|
960,842
|
|
|
201,711
|
|
||
Cash and cash equivalents—end of period
|
$
|
914,603
|
|
|
$
|
178,041
|
|
Hedge Description
|
|
Hedge Instrument
|
|
Contract Volume (MMBtu)
|
|
Price Range ($/MMBtu)
|
|
Final Hedge Maturity Date
|
|
Fair Value
|
|
VaR
|
|||||
Fuel Derivatives
|
|
Fixed price natural gas swaps
|
|
943,000
|
|
|
$3.855- $4.650
|
|
April 2015
|
|
$
|
283
|
|
|
$
|
26
|
|
Hedge Description
|
|
Hedge Instrument
|
|
Initial Notional Amount
|
|
Maximum Notional Amount
|
|
Fixed Interest Rate Range (%)
|
|
Final Hedge Maturity Date
|
|
Fair Value (in thousands)
|
|
10% Change in LIBOR (in thousands)
|
||||
Interest Rate Derivatives
|
|
Interest rate swaps
|
|
$20.0 million
|
|
$3.6 billion
|
|
1.99
|
|
May 2020
|
|
$
|
51,626
|
|
|
$
|
30,090
|
|
Exhibit No.
|
|
Description
|
10.1
|
|
Change orders to the Lump Sum Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Liquefaction Facility, dated as of November 11, 2011, between Sabine Pass Liquefaction, LLC and Bechtel Oil, Gas and Chemicals, Inc.: (i) the Change Order CO-00032 Intra-Plant Feed Gas Header and Jefferson Davis Electrical Distribution, dated January 9, 2014, (ii) the Change Order CO-00033 Revised EPC Agreement Attachments S & T, dated March 24, 2014 and (iii) the Change Order CO-00034 Greenfield/Brownfield Demarcation Adjustment, dated February 19, 2014 (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.) (Incorporated by reference to Exhibit 10.1 to Sabine Pass Liquefaction, LLC’s Quarterly Report on Form 10-Q (SEC File No. 333-192373), filed on May 1, 2014)
|
|
|
|
10.2
|
|
Change orders to the Lump Sum Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Liquefaction Facility, dated as of December 20, 2012, between Sabine Pass Liquefaction, LLC and Bechtel Oil, Gas and Chemicals, Inc.: (i) the Change Order CO-00010 Insurance Provisional Sum Adjustment, dated January 23, 2014, (ii) the Change Order CO-00011 Additional Stage 2 GTGs, dated January 23, 2014, (iii) the Change Order CO-0012 Lien and Claim Waiver Modification, dated March 24, 2014 and (iv) the Change Order CO-00013 Revised Stage 2 EPC Agreement Attachments S&T, dated March 24, 2014 (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.) (Incorporated by reference to Exhibit 10.2 to Sabine Pass Liquefaction, LLC’s Quarterly Report on Form 10-Q (SEC File No. 333-192373), filed on May 1, 2014)
|
|
|
|
10.3*
|
|
Assignment and Amendment Agreement, dated April 7, 2014, among Endesa Generacion S.A., Endesa S.A. and Corpus Christi Liquefaction, LLC.
|
|
|
|
10.4*
|
|
Termination Agreement and Release, dated March 7, 2014, between H. Davis Thames and Cheniere Energy, Inc.
|
|
|
|
10.5*
|
|
Payment Deferral Agreement (O&M Agreement), dated March 27, 2014, between Cheniere Energy Investments, LLC and Cheniere LNG O&M Services, LLC.
|
|
|
|
31.1*
|
|
Certification by Chief Executive Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
|
|
|
31.2*
|
|
Certification by Chief Financial Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
|
|
|
32.1**
|
|
Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
32.2**
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
101.INS*
|
|
XBRL Instance Document
|
|
|
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB*
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
*
|
Filed herewith.
|
|
|
**
|
Furnished herewith.
|
|
CHENIERE ENERGY, INC.
|
|
|
|
|
|
By:
|
/s/ Leonard Travis
|
|
|
Leonard Travis
Vice President and Chief Accounting Officer (on behalf of the registrant and as principal accounting officer)
|
|
Date:
|
May 1, 2014
|
1.
|
Assignment of LNG SPA
. Subject only to the terms and conditions set forth in this Assignment, Assignor hereby grants, assigns, conveys, transfers, delivers and sets over to Assignee all of Assignor’s right, title and interest in, to and under the LNG SPA, to be effective from and after the Assignment Effective Date.
|
2.
|
Assumption of Obligations
. Assignee hereby accepts the assignment made in Clause 1 of this Assignment and hereby assumes all obligations, covenants and liabilities of Assignor arising under the LNG SPA.
|
3.
|
Representation and Warranty
. Assignor and Assignee represent and warrant to CCL that: (i) Assignee has an Acceptable Credit Rating (as defined in the LNG SPA) and (ii) performance of the LNG SPA by CCL with Assignee will comply with Applicable Laws (as defined in the LNG SPA) and all relevant Approvals (as defined in the LNG SPA).
|
4.
|
Release of Guaranty
. Immediately following the assignment and assumption made in Clauses 1 and 2 of this Assignment, CCL shall release the Guaranty and the Parties agree that the Guaranty shall be terminated effective as of the Assignment Effective Date.
|
5.
|
LNG SPA Amendment
. CCL and Assignee agree that, effective immediately following the assignment and assumption made in Clauses 1 and 2 of this Assignment, the LNG SPA shall be amended to include the following new Section 24.8, inserted immediately following Section 24.7 of the LNG SPA:
|
24.8.1
|
The Parties acknowledge that a LNG Sale and Purchase Agreement (FOB) dated 7 April 2014 has been executed between Corpus Christi Liquefaction, LLC and Endesa, S.A. (“
SPA 2
”).
|
24.8.2
|
The Parties expressly agree that all rights and obligations (including in respect of all claims, demands, legal proceedings and actions; all losses, liabilities, damages, costs, judgments, settlements and expenses (whether or not resulting from claims by third parties), including interest and penalties with respect thereto and reasonable attorneys’ and accountants’ fees and expenses; and all mitigation measures) of Corpus Christi Liquefaction, LLC (or its successor or permitted assignee pursuant to SPA 2), and Endesa S.A. (or its successor or permitted assignee pursuant to SPA 2), under SPA 2, whether in contract or at law, are wholly separate and in isolation of, and shall not merge in any way with, any rights and obligations (including in respect of all Claims, all Losses, and all mitigation measures) of the Parties under this Agreement. The Parties expressly waive any right to combine any such rights or obligations under SPA 2 with such rights and obligations under this Agreement. Default by a Party under this Agreement shall not excuse default under SPA 2 by any party thereto, and default under SPA 2 by a party thereto shall not excuse a Party’s default under this Agreement. No Party shall have any obligation to take any action or inaction under this Agreement to mitigate the losses or liabilities that may arise in respect of SPA 2. Without limiting the foregoing, in no way shall the Seller Liability Cap under this Agreement be merged with the corresponding seller liability cap under SPA 2, and the Parties’ respective rights and obligations in respect of the Seller Liability Cap shall not vary based on performance or nonperformance of SPA 2.
|
24.8.3
|
Without prejudice to Section 21.1.5, if the Parties initiate multiple arbitration proceedings under this Agreement and under one or more of (a) any guaranty required to be delivered to Seller pursuant to the terms of this Agreement, (b) SPA 2, and (c) any guaranty required to be delivered to Seller pursuant to the terms of SPA 2, the subject matters of which are related by common questions of law or fact and which could result in conflicting awards or obligations, then either Party may request prior to the appointment of the
|
24.8.4
|
Each Party shall ensure that all invoices and notices sent by or on behalf of such Party pursuant to this Agreement shall identify such notice as being in connection with “SPA 1”, which shall be the designation for this Agreement for all purposes.
|
24.8.5
|
Each Party shall issue invoices and make payments in accordance with this Agreement separate from invoices and payments under SPA 2. If either Party receives payment from the other Party and such payment does not identify itself as being in respect of SPA 2 or this Agreement, then the Party receiving such payment shall have the right to apply such payment received to amounts owed to the receiving Party under SPA 2 or this Agreement, with first priority to overdue amounts (with priority within this group to be based on how many days the amount has been overdue, starting with the longest number of days) and then to other amounts due but unpaid (with priority within this group to be based on how many days remain until the applicable due date, starting with the shortest number of days).
|
24.8.6
|
Each Party shall maintain separate financial and other records in connection with SPA 2 and this Agreement in a manner that enables the Parties to identify whether costs, expenses, and other auditable amounts and information are in respect of SPA 2 or this Agreement and to comply with all audit obligations under SPA 2 and this Agreement.
|
24.8.7
|
Without limiting the foregoing, the Parties agree to conduct their businesses in a manner that effectuates the foregoing terms of this Section 24.8, and that any course of dealing that is inconsistent with the foregoing terms of this Section 24.8 shall not change the Parties’ respective rights and obligations under this Section 24.8.
|
6.
|
Further Assurances
. Assignor and Assignee agree to execute and deliver to one another, from time to time, all such other and additional documents, and to do all such other and further acts and things as may be necessary to more fully and effectively grant, convey and assign to Assignee the rights and interests conveyed (or contemplated herein to be conveyed) to Assignee hereby and to otherwise carry out the transactions contemplated by this Assignment.
|
7.
|
Governing Law
. This Assignment shall be governed by and construed in accordance with the laws of the State of New York (United States of America) without regard to principles of conflict of laws that would specify the use of other laws.
|
8.
|
Dispute Resolution; Immunity
. The provisions of Section 21.1 (
Dispute Resolution
) and Section 21.4 (
Immunity
) of the LNG SPA shall apply in this Assignment as if incorporated herein
mutatis mutandis
on the basis that references therein to the LNG SPA are to this Assignment.
|
9.
|
Amendments and Waiver
. Subject to the rights of CCL and Assignee to supplement, amend, modify or change the LNG SPA (including Section 24.8 thereof) without the consent or approval of Assignor following the assignment and assumption made in Clauses 1 and 2 of this Assignment (but at all times in accordance with the LNG SPA), this Assignment may not be supplemented, amended, modified or changed except by an instrument in writing signed by all Parties. A Party shall not be deemed to have waived any right or remedy under this Assignment by reason of such Party’s failure to enforce such right or remedy.
|
10.
|
Successors
. The terms and provisions of this Assignment shall inure to the benefit of and shall be binding upon the Parties and their respective successors and permitted assigns.
|
11.
|
Severability
. If a court of competent jurisdiction or arbitral tribunal determines that any clause or provision of this Assignment is void, illegal, or unenforceable, the other clauses and provisions of the Assignment shall remain in full force and effect and the clauses and provisions which are determined to be void, illegal, or unenforceable shall be limited so that they shall remain in effect to the maximum extent permissible by law.
|
12.
|
No Third Party Beneficiaries
. Except as expressly contemplated by the LNG SPA, nothing in this Assignment shall entitle any party other than the Parties to this Assignment to any claim, cause of action, remedy or right of any kind.
|
13.
|
Counterparts
. This Assignment may be executed by signing the original or a counterpart thereof (including by facsimile or email transmission). If this Assignment is executed in counterparts, all counterparts taken together shall have the same effect as if the undersigned parties hereto had signed the same instrument.
|
ASSIGNOR:
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
ENDESA GENERACION S.A.
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
||||
By:
|
/s/ Alvaro Quiralte
|
|
By:
|
/s/ Alberto Hernandez
|
||||||||
Name:
|
Alvaro Quiralte
|
|
Name:
|
Alberto Hernandez
|
||||||||
Title:
|
Executive Vice President Energy Management
|
|
Title:
|
Vice President Gas Supply
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSIGNEE:
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
ENDESA S.A.
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Andrea Brentan
|
|
|
|
|
|
|
|
||||
Name:
|
Andrea Brentan
|
|
|
|
|
|
|
|
||||
Title:
|
Chief Executive Officer
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CCL:
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
Corpus Christi Liquefaction, LLC
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Meg A. Gentle
|
|
|
|
|
|
|
|
||||
Name:
|
Meg A. Gentle
|
|
|
|
|
|
|
|
||||
Title:
|
Senior Vice President, Marketing
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
on the Termination Date (or, if such date is not a business day, on the next succeeding business day), pay Mr. Thames his base salary through and including the Termination Date, subject to, and reduced by, the amount of all federal, state and local income, employment and other taxes required to be withheld by Cheniere in connection with such payments (at the minimum withholding tax rate required by the Internal Revenue Code of 1986 as amended (“Code”));
|
(b)
|
on the Termination Date (or, if such date is not a business day, on the next succeeding business day), waive any and all conditions to vesting for, and pay to Mr. Thames, the 2012 Unvested Cash subject to, and reduced by, the amount of all federal, state and local income, employment and other taxes required to be withheld by Cheniere in connection with such payments (at the minimum withholding tax rate required by the Code);
|
(c)
|
on the Termination Date (or, if such date is not a business day, on the next succeeding business day), waive any and all conditions to vesting for, cause the forfeiture restrictions to lapse as to, and cause the immediate vesting of and, as soon as reasonably practicable thereafter, to cause the transfer agent for Cheniere’s common stock to post in an electronic DWAC format unconditionally available without restriction to Mr. Thames’ designated broker, the 2012 Unvested Restricted Stock less the Restricted Stock Withholding (as defined below). Cheniere shall withhold that number of shares of Common Stock having a Fair Market Value (as such term is defined under the Incentive Plan) equal to the amount of federal, state and local income, employment and other taxes required to be withheld by Cheniere with respect to the vesting of the 2012 Unvested Restricted Stock at the minimum withholding tax rate required by the Code (such amount the “Restricted Stock Withholding”); and
|
(d)
|
upon payment of the applicable premium for continued participation and election by Mr. Thames, continue for Mr. Thames and his family coverage in Cheniere’s medical and dental plan pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation Act, as amended
|
(a)
|
Mr. Thames hereby irrevocably agrees (for himself, his heirs, executors, administrators and assigns) to release, acquit and discharge and does hereby release, acquit and forever discharge Cheniere, its Affiliates and their respective directors, officers, managers, employees and representatives (such entities and individuals collectively, the “Cheniere Entities”) collectively and individually, from any and all claims whether known or unknown and from any and all causes of action whether known or unknown against any of the Cheniere Entities, of any kind or character, that Mr. Thames may have against any such Cheniere Entity, in any capacity, including, but not limited to, any claim for benefits, bonuses, compensation, costs, damages, expenses, remuneration, salary, or wages; and further including but not limited to all claims or causes of action arising from his employment, termination of employment, or any alleged unlawful employment practices, including claims under the Age Discrimination in Employment Act (“ADEA”) and any and all claims or causes of action arising under any other federal, state or local laws (collectively, the “Thames Released Claims”).
|
(b)
|
Mr. Thames hereby irrevocably covenants and agrees to refrain from asserting any claim or demand, or commencing, instituting or causing to be commenced any proceeding of any kind, against any of the Cheniere Entities based upon any Thames Released Claim. If Mr. Thames brings any claim, demand or other proceeding against any of the Cheniere Entities with respect to any Thames Released Claim, then Mr. Thames shall indemnify such Cheniere Entity or Cheniere Entities in the amount or value of any final judgment or settlement (monetary or other) and any related cost (including, without limitation, reasonable attorneys’ fees) entered against, paid or incurred by such Cheniere Entity or Cheniere Entities with respect to such claim, demand or other proceeding.
|
(c)
|
Cheniere and the Cheniere Entities agree to release, acquit and discharge and do hereby release, acquit and discharge Mr. Thames from any and all claims whether known or unknown and from any and all causes of action
|
(d)
|
Each of the Cheniere Entities hereby irrevocably covenants and agrees to refrain from asserting any claim or demand, or commencing, instituting or causing to be commenced any proceeding of any kind, against Mr. Thames based upon any Cheniere Entities Released Claim. If any of the Cheniere Entities brings any claim, demand or other proceeding against Mr. Thames with respect to any Cheniere Entities Released Claim, then Cheniere and such other Cheniere Entity or Cheniere Entities shall indemnify Mr. Thames in the amount or value of any final judgment or settlement (monetary or other) and any related cost (including, without limitation, reasonable attorneys’ fees) entered against, paid or incurred by Mr. Thames with respect to such claim, demand or other proceeding.
|
March 7, 2014
|
|
/s/ H. Davis Thames
|
Date
|
|
H. DAVIS THAMES
|
|
|
|
|
|
|
|
|
CHENIERE ENERGY, INC.
|
|
|
|
March 7, 2014
|
|
By /s/ Michael J. Wortley
|
Date
|
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Cheniere Energy, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Charif Souki
|
Charif Souki
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Cheniere Energy, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Michael J. Wortley
|
Michael J. Wortley
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
|
/s/ Charif Souki
|
Charif Souki
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
|
/s/ Michael J. Wortley
|
Michael J. Wortley
Chief Financial Officer
|