|3 Months Ended|
Mar. 31, 2019
|Subsequent Events [Abstract]|
NOTE 14 — SUBSEQUENT EVENTS
Common Stock Purchase Agreement
On April 3, 2019, we entered into a Common Stock Purchase Agreement (the “CSPA”) with Total Delaware, Inc., a Delaware corporation and subsidiary of TOTAL S.A. (“Total”), pursuant to which Total agreed to purchase, and the Company agreed to issue and sell in a private placement to Total, approximately 19.9 million shares of our common stock in exchange for a cash purchase price of approximately $10.06 per share, resulting in aggregate gross proceeds of approximately $200.0 million (the “Private Placement”).
The closing of the Private Placement is subject to the satisfaction of certain closing conditions, including (i) obtaining the approval of the Company’s stockholders for the issuance and sale of our common stock pursuant to the CSPA; (ii) the Company reaching the affirmative final investment decision (“FID”) with respect to the Driftwood LNG Project — Phase I (as such term is defined in the CSPA) (the “Phase I Driftwood LNG Project”); (iii) the Company acquiring a 7.2% interest in Driftwood Holdings LP, the entity that will hold the Phase I Driftwood LNG Project, for $1.0 billion (the “Company Subsidiary Investment”); and (iv) certain other customary closing conditions. Furthermore, the CSPA contains customary representations, warranties and covenants of the Company and Total.
In addition, under the terms of the CSPA, the Company granted certain anti-dilution rights to Total that will entitle Total to purchase additional shares of the Company’s common stock under certain circumstances if all or a portion of the Company Subsidiary Investment is financed with securities convertible into the Company’s common stock (“Phase I Convertible Securities”). This anti-dilution right will entitle Total to buy additional shares of the Company’s common stock following any conversion of Phase I Convertible Securities to the extent necessary for Total to maintain an ownership percentage of 20% with respect to the outstanding shares of the Company’s common stock, as calculated in the manner provided in the CSPA. The purchase price for such shares will be equal to the lower of (i) $10.06 and (ii) the price per share of the Company’s common stock at which the applicable Phase I Convertible Securities were converted.
On April 23, 2019, in furtherance of our strategy of developing our LNG marketing activities, we entered into a master LNG sale and purchase agreement and related confirmation notices (the “SPA”) with an unrelated third-party LNG merchant. Pursuant to the SPA, we have committed to purchase one cargo of LNG per quarter beginning in June 2020 through October 2022. The quantity of each cargo is expected to range from 3.3 to 3.6 million MMBtu, and each cargo will be purchased under DES terms. The price for each cargo will be based on the JKM price in effect at the time of each purchase.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef