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NextDecade sells US$50 million of convertible preferred stock

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Hydrocarbon Engineering,

NextDecade Corp. has agreed to sell US$50 million of convertible preferred stock to HGC NEXT INV LLC and to funds and accounts managed by each of York Capital Management Global Advisors LLC and its affiliates Valinor Management LP and Halcyon Capital Management LP.

HGC, a wholly owned subsidiary of a Korean petrochemical company, will invest US$35 million, and NextDecade’s three largest stockholders, York, Valinor, and Halcyon, will invest US$15 million pursuant to backstop agreements dated 11 April 2018. These investments will be made in series A convertible preferred stock pursuant to the company’s private offering approved at a special meeting of stockholders on 15 June 2018.

As part of its investment in NextDecade, HGC will receive one seat on the company’s board of directors, and will also have the right to contribute up to US$350 million of project-level equity upon the final investment decision of NextDecade’s Rio Grande LNG project.

The company intends to use the proceeds of the series A private offering to continue developing its Rio Grande LNG terminal facility and associated pipelines in South Texas and for general corporate purposes and working capital.

During the course of the offering, NextDecade received expressions of interest for convertible preferred stock in excess of the US$50 million authorised at the special meeting. NextDecade or any prospective investors may elect not to pursue any additional transactions. Should the company elect to pursue any transactions in excess of the US$50 million authorised at the special meeting, it would seek stockholder approval for the issuance of additional convertible preferred stock.

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