FORM
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10-Q
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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06-0842255
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer Identification No.)
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1201 Louisiana Street,
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Suite 3100,
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Houston,
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TX
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77002
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading symbol
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Name of each exchange on which registered
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Common stock, par value $0.01 per share
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TELL
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NASDAQ
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Capital Market
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Large accelerated filer
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☒
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Page
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Item 1.
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Condensed Consolidated Financial Statements
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Condensed Consolidated Balance Sheets
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Condensed Consolidated Statements of Operations
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Condensed Consolidated Statement of Changes in Stockholders’ Equity
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Condensed Consolidated Statements of Cash Flows
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Notes to Condensed Consolidated Financial Statements
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Item 2.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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Item 3.
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Quantitative and Qualitative Disclosures about Market Risk
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Item 4.
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Controls and Procedures
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Item 1.
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Legal Proceedings
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Item 1A.
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Risk Factors
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Item 2.
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Unregistered Sales of Equity Securities and Use of Proceeds
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Item 5.
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Other Information
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Item 6.
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Exhibits
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|||
|
•
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our businesses and prospects and our overall strategy;
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•
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planned or estimated capital expenditures;
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•
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availability of liquidity and capital resources;
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•
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our ability to obtain additional financing as needed and the terms of financing transactions, including at Driftwood Holdings LP;
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•
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revenues and expenses;
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•
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progress in developing our projects and the timing of that progress;
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•
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future values of the Company’s projects or other interests, operations or rights; and
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•
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government regulations, including our ability to obtain, and the timing of, necessary governmental permits and approvals.
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•
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the uncertain nature of demand for and price of natural gas and LNG;
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•
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risks related to shortages of LNG vessels worldwide;
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•
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technological innovation which may render our anticipated competitive advantage obsolete;
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•
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risks related to a terrorist or military incident involving an LNG carrier;
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•
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changes in legislation and regulations relating to the LNG industry, including environmental laws and regulations that impose significant compliance costs and liabilities;
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•
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governmental interventions in the LNG industry, including increases in barriers to international trade;
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•
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uncertainties regarding our ability to maintain sufficient liquidity and attract sufficient capital resources to implement our projects;
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•
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our limited operating history;
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•
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our ability to attract and retain key personnel;
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•
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risks related to doing business in, and having counterparties in, foreign countries;
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•
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our reliance on the skill and expertise of third-party service providers;
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•
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the ability of our vendors to meet their contractual obligations;
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•
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risks and uncertainties inherent in management estimates of future operating results and cash flows;
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•
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our ability to maintain compliance with our debt arrangements and other agreements;
|
•
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the potential discontinuation of the London Inter-Bank Offered Rate;
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•
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changes in competitive factors, including the development or expansion of LNG, pipeline and other projects that are competitive with ours;
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•
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development risks, operational hazards and regulatory approvals;
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•
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our ability to enter into and consummate planned financing and other transactions;
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•
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risks related to pandemics or disease outbreaks; and
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•
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risks and uncertainties associated with litigation matters.
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ASU
|
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Accounting Standards Update
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Bcf
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Billion cubic feet of natural gas
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Bcf/d
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Bcf per day
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DD&A
|
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Depreciation, depletion and amortization
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DES
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Delivered ex-ship
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EPC
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Engineering, procurement and construction
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FASB
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Financial Accounting Standards Board
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FID
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Final investment decision as it pertains to the Driftwood Project
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GAAP
|
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Generally accepted accounting principles in the U.S.
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JKM
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Platts Japan Korea Marker index price for LNG
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LNG
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Liquefied natural gas
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LSTK
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Lump sum turnkey
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MMBtu
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|
Million British thermal units
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Mtpa
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Million tonnes per annum
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Nasdaq
|
|
Nasdaq Capital Market
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SEC
|
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U.S. Securities and Exchange Commission
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Train
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An industrial facility comprised of a series of refrigerant compressor loops used to cool natural gas into LNG
|
U.S.
|
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United States
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USACE
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U.S. Army Corps of Engineers
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TELLURIAN INC. AND SUBSIDIARIES
|
|||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||||
(in thousands, except share and per share amounts, unaudited)
|
|||||||
|
|
|
|
||||
|
March 31, 2020
|
|
December 31, 2019
|
||||
ASSETS
|
|
||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
55,452
|
|
|
$
|
64,615
|
|
Accounts receivable
|
3,195
|
|
|
5,006
|
|
||
Accounts receivable due from related parties
|
1,316
|
|
|
1,316
|
|
||
Prepaid expenses and other current assets
|
8,145
|
|
|
11,298
|
|
||
Total current assets
|
68,108
|
|
|
82,235
|
|
||
Property, plant and equipment, net
|
146,898
|
|
|
153,040
|
|
||
Deferred engineering costs
|
109,040
|
|
|
106,425
|
|
||
Non-current restricted cash
|
3,570
|
|
|
3,867
|
|
||
Other non-current assets
|
36,683
|
|
|
36,755
|
|
||
Total assets
|
$
|
364,299
|
|
|
$
|
382,322
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
27,022
|
|
|
$
|
21,048
|
|
Accrued and other liabilities
|
37,387
|
|
|
33,003
|
|
||
Senior secured term loan
|
—
|
|
|
78,528
|
|
||
Total current liabilities
|
64,409
|
|
|
132,579
|
|
||
Long-term liabilities:
|
|
|
|
||||
Borrowings
|
128,589
|
|
|
58,121
|
|
||
Other non-current liabilities
|
24,657
|
|
|
25,337
|
|
||
Total long-term liabilities
|
153,246
|
|
|
83,458
|
|
||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.01 par value, 100,000,000 authorized:
6,123,782 and 6,123,782 shares outstanding, respectively
|
61
|
|
|
61
|
|
||
Common stock, $0.01 par value, 400,000,000 authorized:
255,462,543 and 242,207,522 shares outstanding, respectively
|
2,344
|
|
|
2,211
|
|
||
Additional paid-in capital
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790,599
|
|
|
769,639
|
|
||
Accumulated deficit
|
(646,360
|
)
|
|
(605,626
|
)
|
||
Total stockholders’ equity
|
146,644
|
|
|
166,285
|
|
||
Total liabilities and stockholders’ equity
|
$
|
364,299
|
|
|
$
|
382,322
|
|
TELLURIAN INC. AND SUBSIDIARIES
|
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||
(in thousands, unaudited)
|
|||||||
|
|
||||||
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(40,734
|
)
|
|
$
|
(34,126
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation, depletion and amortization
|
5,832
|
|
|
2,985
|
|
||
Amortization of debt issuance costs, discounts and fees
|
3,231
|
|
|
268
|
|
||
Share-based compensation
|
683
|
|
|
2,093
|
|
||
Share-based payments
|
111
|
|
|
—
|
|
||
Interest elected to be paid-in-kind
|
130
|
|
|
—
|
|
||
Gain on financial instruments not designated as hedges
|
(101
|
)
|
|
1,241
|
|
||
Other
|
1,163
|
|
|
(1,826
|
)
|
||
Net changes in working capital (Note 14)
|
9,191
|
|
|
(3,670
|
)
|
||
Net cash used in operating activities
|
(20,494
|
)
|
|
(33,035
|
)
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
||||
Development of natural gas properties
|
(269
|
)
|
|
(21,502
|
)
|
||
Deferred engineering costs
|
—
|
|
|
(6,000
|
)
|
||
Purchase of property, plant and equipment
|
—
|
|
|
(1,366
|
)
|
||
Net cash used in investing activities
|
(269
|
)
|
|
(28,868
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from common stock issuance
|
13,324
|
|
|
—
|
|
||
Principal payments
|
(2,000
|
)
|
|
—
|
|
||
Tax payments for net share settlement of equity awards (Note 14)
|
—
|
|
|
(5,395
|
)
|
||
Other
|
(21
|
)
|
|
—
|
|
||
Net cash provided by/(used in) financing activities
|
11,303
|
|
|
(5,395
|
)
|
||
|
|
|
|
||||
Net (decrease) increase in cash, cash equivalents and restricted cash
|
(9,460
|
)
|
|
(67,298
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of period
|
68,482
|
|
|
183,589
|
|
||
Cash, cash equivalents and restricted cash, end of period
|
$
|
59,022
|
|
|
$
|
116,291
|
|
Supplementary disclosure of cash flow information:
|
|
|
|
||||
Interest paid
|
$
|
2,905
|
|
|
$
|
1,171
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Prepaid expenses
|
$
|
888
|
|
|
$
|
1,234
|
|
Deposits
|
357
|
|
|
364
|
|
||
Tradable equity securities
|
2,362
|
|
|
5,069
|
|
||
Derivative asset (Note 6)
|
3,482
|
|
|
3,121
|
|
||
Other current assets
|
1,056
|
|
|
1,510
|
|
||
Total prepaid expenses and other current assets
|
$
|
8,145
|
|
|
$
|
11,298
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Land
|
$
|
13,808
|
|
|
$
|
13,808
|
|
Proved properties
|
142,289
|
|
|
142,494
|
|
||
Wells in progress
|
—
|
|
|
57
|
|
||
Corporate and other
|
5,285
|
|
|
5,285
|
|
||
Total property, plant and equipment at cost
|
161,382
|
|
|
161,644
|
|
||
Right of use asset — finance leases (Note 13)
|
13,371
|
|
|
13,437
|
|
||
Accumulated DD&A
|
(27,855
|
)
|
|
(22,041
|
)
|
||
Total property, plant and equipment, net
|
$
|
146,898
|
|
|
$
|
153,040
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Land lease and purchase options
|
$
|
4,882
|
|
|
$
|
4,320
|
|
Permitting costs
|
13,092
|
|
|
12,838
|
|
||
Right of use asset — operating leases (Note 13)
|
15,272
|
|
|
15,832
|
|
||
Other
|
3,437
|
|
|
3,765
|
|
||
Total other non-current assets
|
$
|
36,683
|
|
|
$
|
36,755
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Project development activities
|
$
|
2,577
|
|
|
$
|
3,851
|
|
Payroll and compensation
|
17,803
|
|
|
18,773
|
|
||
Severance and reorganization
|
5,888
|
|
|
—
|
|
||
Accrued taxes
|
997
|
|
|
1,018
|
|
||
Professional services (e.g., legal, audit)
|
1,868
|
|
|
2,906
|
|
||
Warrant liability (Note 10)
|
2,384
|
|
|
—
|
|
||
Lease liabilities (Note 13)
|
3,755
|
|
|
3,729
|
|
||
Other
|
2,115
|
|
|
2,726
|
|
||
Total accrued and other liabilities
|
$
|
37,387
|
|
|
$
|
33,003
|
|
|
|
|
March 31, 2020
|
||||||||||
|
|
|
Principal repayment obligation (1)
|
|
Unamortized DFC and discounts
|
|
Carrying value
|
||||||
Amended 2019 Term Loan, due November 2021
|
|
$
|
73,130
|
|
|
$
|
(2,931
|
)
|
|
$
|
70,199
|
|
|
2018 Term Loan, due September 2021
|
|
60,000
|
|
|
(1,610
|
)
|
|
58,390
|
|
||||
Total borrowings
|
|
$
|
133,130
|
|
|
$
|
(4,541
|
)
|
|
$
|
128,589
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
December 31, 2019
|
||||||||||
|
|
|
Principal repayment obligation and
other fees (2) |
|
Unamortized DFC and discounts
|
|
Carrying value
|
||||||
2019 Term Loan, due May 2020
|
|
$
|
84,955
|
|
|
$
|
(6,427
|
)
|
|
$
|
78,528
|
|
|
2018 Term Loan, due September 2021
|
|
60,000
|
|
|
(1,879
|
)
|
|
58,121
|
|
||||
Total borrowings
|
|
$
|
144,955
|
|
|
$
|
(8,306
|
)
|
|
$
|
136,649
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
(1) Includes paid-in-kind interest on the 2019 Term loan of $0.1 million
|
|||||||||||||
(2) Includes paid-in-kind interest on the 2019 Term loan of $1.8 million as well as a final payment fee equal to 20% of the principal amount less financing costs and cash interest amounts paid.
|
•
|
Extended the maturity date from May 23, 2020 to November 23, 2021;
|
•
|
Modified the frequency of interest payments from quarterly to monthly;
|
•
|
Modified the interest rate from 12%, with the ability to defer 4% per quarter as paid-in-kind, to 16%, with the ability to defer 8% per month as paid-in-kind;
|
•
|
Required a principal payment of $3.0 million by April 22, 2020; and
|
•
|
Reduced the required month-end collateral amount from $30.0 million to $12.0 million.
|
Vesting
|
|
Number of Shares
|
|
Immediately
|
|
3,000
|
|
September 23, 2020
|
|
2,000
|
|
March 23, 2021
|
|
2,000
|
|
June 23, 2021
|
|
2,000
|
|
Total
|
|
9,000
|
|
Maturity of lease liability
|
Operating
|
|
Finance
|
||||
2020
|
$
|
2,721
|
|
|
$
|
2,264
|
|
2021
|
3,496
|
|
|
1,019
|
|
||
2022
|
3,802
|
|
|
1,019
|
|
||
2023
|
4,070
|
|
|
1,019
|
|
||
2024
|
3,081
|
|
|
1,019
|
|
||
After 2024
|
4,980
|
|
|
47,667
|
|
||
Total lease payments
|
$
|
22,150
|
|
|
$
|
54,007
|
|
Less: discount
|
4,714
|
|
|
44,069
|
|
||
Present value of lease liability
|
$
|
17,436
|
|
|
$
|
9,938
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Accounts receivable
|
$
|
1,811
|
|
|
$
|
(2,166
|
)
|
Prepaid expenses and other current assets
|
2,262
|
|
|
(1,166
|
)
|
||
Accounts payable
|
3,280
|
|
|
(6,936
|
)
|
||
Accrued liabilities
|
2,500
|
|
|
7,141
|
|
||
Other, net
|
(662
|
)
|
|
(543
|
)
|
||
Net changes in working capital
|
$
|
9,191
|
|
|
$
|
(3,670
|
)
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Non-cash accruals of property, plant and equipment and other non-current assets
|
$
|
2,174
|
|
|
$
|
5,478
|
|
Non-cash settlement of Final Payment Fee (Note 8)
|
8,539
|
|
|
|
|||
Tradable equity securities
|
2,362
|
|
|
—
|
|
||
Non-cash settlement of withholding taxes associated with the 2018 bonus and vesting of certain awards, respectively
|
—
|
|
|
5,395
|
|
||
Non-cash settlement of the 2018 bonus
|
—
|
|
|
18,396
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Cash and cash equivalents
|
$
|
55,452
|
|
|
$
|
88,251
|
|
Non-current restricted cash
|
3,570
|
|
|
28,040
|
|
||
Total cash, cash equivalents and restricted cash shown in the statements of cash flows
|
$
|
59,022
|
|
|
$
|
116,291
|
|
•
|
Our Business
|
•
|
Overview of Significant Events
|
•
|
Liquidity and Capital Resources
|
•
|
Capital Development Activities
|
•
|
Results of Operations
|
•
|
Off-Balance Sheet Arrangements
|
•
|
Recent Accounting Standards
|
•
|
Extended the maturity date from May 23, 2020 to November 23, 2021;
|
•
|
Modified the frequency of interest payments from quarterly to monthly;
|
•
|
Modified the interest rate from 12%, with the ability to defer 4% per quarter as paid-in-kind, to 16%, with the ability to defer 8% per month as paid-in-kind;
|
•
|
Required a principal payment of $3.0 million by April 22, 2020; and
|
•
|
Reduced the required month-end collateral amount from $30.0 million to $12.0 million.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
|||||||
|
|
2020
|
|
2019
|
||||
Cash used in operating activities
|
|
$
|
(20,494
|
)
|
|
$
|
(33,035
|
)
|
Cash used in investing activities
|
|
(269
|
)
|
|
(28,868
|
)
|
||
Cash provided by/(used in) financing activities
|
|
11,303
|
|
|
(5,395
|
)
|
||
|
|
|
|
|
||||
Net (decrease) increase in cash, cash equivalents and restricted cash
|
|
(9,460
|
)
|
|
(67,298
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of the period
|
|
68,482
|
|
|
183,589
|
|
||
Cash, cash equivalents and restricted cash, end of the period
|
|
$
|
59,022
|
|
|
$
|
116,291
|
|
|
|
|
|
|
||||
Net working capital
|
|
$
|
3,699
|
|
|
$
|
67,715
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Natural gas sales
|
$
|
8,217
|
|
|
$
|
4,959
|
|
Cost of sales
|
2,879
|
|
|
1,112
|
|
||
Development expenses
|
11,183
|
|
|
11,875
|
|
||
Depreciation, depletion and amortization
|
5,832
|
|
|
2,531
|
|
||
General and administrative expenses
|
17,239
|
|
|
22,053
|
|
||
Severance and reorganization charges
|
5,505
|
|
|
—
|
|
||
Loss from operations
|
(34,421
|
)
|
|
(32,612
|
)
|
||
Interest expense, net
|
(6,396
|
)
|
|
(587
|
)
|
||
Other income (expense), net
|
83
|
|
|
(927
|
)
|
||
Income tax benefit
|
—
|
|
|
—
|
|
||
Net loss
|
$
|
(40,734
|
)
|
|
$
|
(34,126
|
)
|
•
|
Increases in Cost of sales and DD&A by approximately $1.8 million and $3.3 million, respectively, compared to the same period in 2019 were due to an increase in natural gas production and sales volumes.
|
•
|
Severance and reorganization charges of approximately $5.5 million were incurred during the period in connection with the Plan. For further information regarding the Plan, see Note 7, Accrued and Other Liabilities, of our Notes to the Condensed Consolidated Financial Statements.
|
•
|
Increase of approximately $5.8 million in interest expense, net, is primarily attributable to the 2019 Term Loan, which was not in place in the prior period.
|
Exhibit No.
|
|
Description
|
1.1
|
|
|
1.2
|
|
|
1.3
|
|
|
1.4‡
|
|
|
4.1*
|
|
|
4.2
|
|
|
4.3
|
|
|
4.4
|
|
|
4.5
|
|
|
4.6
|
|
|
10.1††*
|
|
|
10.2††*
|
|
|
10.3††*
|
|
|
10.4
|
|
|
10.5
|
|
|
10.6
|
|
|
10.7‡
|
|
|
10.8‡
|
|
Exhibit No.
|
|
Description
|
10.9
|
|
|
31.1*
|
|
|
31.2*
|
|
|
32.1**
|
|
|
32.2**
|
|
|
99.1*
|
|
|
101.INS*
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
101.SCH*
|
|
Inline XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
|
Inline XBRL Taxonomy Extension Labels Linkbase Document
|
101.PRE*
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
104
|
|
The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, formatted in Inline XBRL
|
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
†
|
Management contract or compensatory plan or arrangement.
|
††
|
Portions of this exhibit have been omitted in accordance with Item 601(b)(2) or 601(b)(10) of Regulation S-K. The omitted information is not material and would likely cause competitive harm to the registrant if publicly disclosed. The registrant hereby agrees to furnish supplementally an unredacted copy of this exhibit to the Securities and Exchange Commission upon request.
|
‡
|
Certain schedules or similar attachments to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K. The registrant hereby agrees to furnish supplementally to the Securities and Exchange Commission upon request a copy of any omitted schedule or attachment to this exhibit.
|
|
|
TELLURIAN INC.
|
|
|
|
|
|
Date:
|
May 4, 2020
|
By:
|
/s/ Kian Granmayeh
|
|
|
|
Kian Granmayeh
|
|
|
|
Executive Vice President & Chief Financial Officer
|
|
|
|
(as Principal Financial Officer)
|
|
|
|
Tellurian Inc.
|
|
|
|
|
Date:
|
May 4, 2020
|
By:
|
/s/ Khaled A. Sharafeldin
|
|
|
|
Khaled A. Sharafeldin
|
|
|
|
Chief Accounting Officer
|
|
|
|
(as Principal Accounting Officer)
|
|
|
|
Tellurian Inc.
|
d)
|
Mechanics of Exercise.
|
i.
|
The Company:
|
|
Tellurian Inc.
1201 Louisiana St
Suite 3100
Houston, TX 77002
Attention: Legal
Email: legal.notices@tellurianinc.com
|
ii.
|
The Holder:
|
|
Nineteen77 Capital Solutions A LP
c/o UBS O’Connor LLC
787 7th Avenue, 13th Floor
New York, NY 10019
Attention: Rodrigo Trelles
Email: OL-OCS@ubs.com
|
with copies (which shall not constitute notice) to:
|
Nineteen77 Capital Solutions A LP
c/o UBS O’Connor LLC
UBS Tower
1 N. Wacker Drive
Chicago, IL 60606
Attention: Andrew Hollenbeck
Email: andrew.hollenbeck@ubs.com
|
with copies (which shall not constitute notice) to:
|
Latham & Watkins LLP
885 Third Avenue
New York, NY 10022
Attention: Matthew Henegar
Telephone No.: 212-906-1814
Email: matthew.henegar@lw.com
Latham & Watkins LLP
885 Third Avenue
New York, NY 10022
Attention: David E. Owen
Telephone No.: 212-906-4503
Email: david.owen@lw.com
|
TELLURIAN INC.
|
|
|
By:
|
Name:
|
Title:
|
Name:
|
|
|
(Please Print)
|
Address:
|
|
Phone Number:
|
|
Email Address:
|
|
Dated:
|
_______________ __, ______
|
Holder’s Signature:
|
|
Holder’s Address:
|
|
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***] INDICATES THAT INFORMATION HAS BEEN REDACTED.
|
PROJECT NAME: Driftwood LNG Phase 2
OWNER: Driftwood LNG LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: 10 November 2017
|
CHANGE ORDER NUMBER: CO-004
DATE OF CHANGE ORDER: January 21, 2020
|
I.
|
SCHEDULE REDUCTION
|
Limited Notice to Proceed
|
[***] Days prior to Owner’s issuance of Notice to Proceed
|
Notice to Proceed
|
Day Zero
|
Ready for Start Up
|
[***] Days following Owner’s issuance of Notice to Proceed
|
Target Substantial Completion Date
|
[***] Days from Owner’s issuance of Notice to Proceed
|
Guaranteed Substantial Completion Date
|
[***] Days from Owner’s issuance of Notice to Proceed
|
Final Completion
|
[***] Days after Guaranteed Substantial Completion Date
|
Adjustment to Contract Price
|
|
|
The original Contract Price was
|
USD 2,515,986,451
|
EUR 166,316,651
|
Net change by previously authorized Change Orders
|
USD 60,206,464
|
EUR 0
|
The Contract Price prior to this Change Order was
|
USD 2,576,192,915
|
EUR 166,316,651
|
The Contract Price will be increased (decreased) (unchanged)
|
|
|
by this Change Order in the amount of
|
USD 0
|
EUR 0
|
The new Contract Price including this Change Order will be
|
USD 2,576,192,915
|
EUR 166,316,651
|
|
|
|
|
|
|
The Aggregate Provisional Sum prior to this Change Order was
|
USD 165,239,413
|
EUR 0
|
The Aggregate Provisional Sum will be unchanged
|
|
|
by this Change Order in the amount of
|
USD 0
|
EUR 0
|
The new Aggregate Provisional Sum
|
|
|
including this Change Order will be
|
USD 165,239,413
|
EUR 0
|
|
|
|
/s/ [***]
|
|
/s/ [***]
|
Owner
|
|
Contractor
|
[***]
|
|
[***]
|
Name
|
|
Name
|
[***]
|
|
[***]
|
Title
|
|
Title
|
January 21, 2020
|
|
January 21, 2020
|
Date of Signing
|
|
Date of Signing
|
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***] INDICATES THAT INFORMATION HAS BEEN REDACTED.
|
PROJECT NAME: Driftwood LNG Phase 3
OWNER: Driftwood LNG LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: 10 November 2017
|
CHANGE ORDER NUMBER: CO-004
DATE OF CHANGE ORDER: January 21, 2020
|
I.
|
SCHEDULE REDUCTION
|
Limited Notice to Proceed
|
[***] Days prior to Owner’s issuance of Notice to Proceed
|
Notice to Proceed
|
Day Zero
|
Ready for Start Up
|
[***] Days following Owner’s issuance of Notice to Proceed
|
Target Substantial Completion Date
|
[***] Days from Owner’s issuance of Notice to Proceed
|
Guaranteed Substantial Completion Date
|
[***] Days from Owner’s issuance of Notice to Proceed
|
Final Completion
|
[***] Days after Guaranteed Substantial Completion Date
|
Adjustment to Contract Price
|
|
|
The original Contract Price was
|
USD 2,552,105,578
|
EUR 165,167,044
|
Net change by previously authorized Change Orders
|
USD 0
|
EUR 0
|
The Contract Price prior to this Change Order was
|
USD 2,552,105,578
|
EUR 165,167,044
|
The Contract Price will be increased (decreased) unchanged
|
|
|
by this Change Order in the amount of
|
USD 0
|
EUR 0
|
The new Contract Price including this Change Order will be
|
USD 2,552,105,578
|
EUR 165,167,044
|
|
|
|
|
|
|
The Aggregate Provisional Sum prior to this Change Order was
|
USD 215,573,207
|
EUR 0
|
The Aggregate Provisional Sum will be increased (decreased) unchanged
|
|
|
by this Change Order in the amount of
|
USD 0
|
EUR 0
|
The new Aggregate Provisional Sum
|
|
|
including this Change Order will be
|
USD 215,573,207
|
EUR 0
|
|
|
|
/s/ [***]
|
|
/s/ [***]
|
Owner
|
|
Contractor
|
[***]
|
|
[***]
|
Name
|
|
Name
|
[***]
|
|
[***]
|
Title
|
|
Title
|
January 21, 2020
|
|
January 21, 2020
|
Date of Signing
|
|
Date of Signing
|
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***] INDICATES THAT INFORMATION HAS BEEN REDACTED.
|
PROJECT NAME: Driftwood LNG Phase 4
OWNER: Driftwood LNG LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: 10 November 2017
|
CHANGE ORDER NUMBER: CO-004
DATE OF CHANGE ORDER: January 21, 2020
|
I.
|
SCHEDULE REDUCTION
|
Limited Notice to Proceed
|
[***] Days prior to Owner’s issuance of Notice to Proceed
|
Notice to Proceed
|
Day Zero
|
Ready for Start Up
|
[***] Days following Owner’s issuance of Notice to Proceed
|
Target Substantial Completion Date
|
[***] Days from Owner’s issuance of Notice to Proceed
|
Guaranteed Substantial Completion Date
|
[***] Days from Owner’s issuance of Notice to Proceed
|
Final Completion
|
[***] Days after Guaranteed Substantial Completion Date
|
Adjustment to Contract Price
|
|
|
The original Contract Price was
|
USD 1,925,058,672
|
EUR 148,365,834
|
Net change by previously authorized Change Orders
|
USD 0
|
EUR 0
|
The Contract Price prior to this Change Order was
|
USD 1,925,058,672
|
EUR 148,365,834
|
The Contract Price will be increased (decreased) unchanged
|
|
|
by this Change Order in the amount of
|
USD 0
|
EUR 0
|
The new Contract Price including this Change Order will be
|
USD 1,925,058,672
|
EUR 148,365,834
|
|
|
|
|
|
|
The Aggregate Provisional Sum prior to this Change Order was
|
USD 127,877,840
|
EUR 0
|
The Aggregate Provisional Sum will be increased (decreased) unchanged
|
|
|
by this Change Order in the amount of
|
USD 0
|
EUR 0
|
The new Aggregate Provisional Sum
|
|
|
including this Change Order will be
|
USD 127,877,840
|
EUR 0
|
|
|
|
/s/ [***]
|
|
/s/ [***]
|
Owner
|
|
Contractor
|
[***]
|
|
[***]
|
Name
|
|
Name
|
[***]
|
|
[***]
|
Title
|
|
Title
|
January 21, 2020
|
|
January 21, 2020
|
Date of Signing
|
|
Date of Signing
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Tellurian 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; and
|
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 (the registrant’s fourth fiscal quarter in the case of an annual report) 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/ Meg A. Gentle
|
Meg A. Gentle
|
Chief Executive Officer
|
(as Principal Executive Officer)
|
Tellurian Inc.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Tellurian 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; and
|
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 (the registrant’s fourth fiscal quarter in the case of an annual report) 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/ Kian Granmayeh
|
Kian Granmayeh
|
Executive Vice President & Chief Financial Officer
|
(as Principal Financial Officer)
|
Tellurian Inc.
|
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 results of operations of the Company.
|
/s/ Meg A. Gentle
|
Meg A. Gentle
|
Chief Executive Officer
|
(as Principal Executive Officer)
|
Tellurian Inc.
|
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 results of operations of the Company.
|
/s/ Kian Granmayeh
|
Kian Granmayeh
|
Executive Vice President & Chief Financial Officer
|
(as Principal Financial Officer)
|
Tellurian Inc.
|