| Item 1.01 | Entry into a Material Definitive Agreement. |
On March 11, 2021 (the “Issue Date”), Cheniere Energy Partners, L.P. (the “Partnership”) closed the sale of its previously announced offering of $1.5 billion aggregate principal amount of its 4.000% Senior Notes due 2031 (the “Notes”). The sale of the Notes was not registered under the Securities Act of 1933, as amended (the “Securities Act”), and the Notes were sold on a private placement basis in reliance on Section 4(a)(2) of the Securities Act and Rule 144A and Regulation S thereunder.
Fifth Supplemental Indenture
The Notes were issued on the Issue Date pursuant to the indenture, dated as of September 18, 2017 (the “Base Indenture”), by and among the Partnership, the Guarantors, and The Bank of New York Mellon, as Trustee under the Indenture (the “Trustee”), as supplemented by the Fifth Supplemental Indenture, dated as of the Issue Date, among the Partnership, the Guarantors and the Trustee, relating to the Notes (the “Fifth Supplemental Indenture”). The Base Indenture as supplemented by the Fifth Supplemental Indenture is referred to herein as the “Notes Indenture.”
Under the terms of the Fifth Supplemental Indenture, the Notes will mature on March 1, 2031 and will accrue interest at a rate equal to 4.000% per annum on the principal amount from the Issue Date, with such interest payable semi-annually, in cash in arrears, on March 1 and September 1 of each year, beginning on September 1, 2021.
The Notes are the Partnership’s senior obligations, ranking equally in right of payment with the Partnership’s other existing and future unsubordinated debt and senior to any of its future subordinated debt. The Notes are unconditionally guaranteed by each of the Partnership’s subsidiaries in existence on the Issue Date (including, for the avoidance of doubt, Sabine Pass LNG, L.P. (“SPLNG”) and Cheniere Creole Trail Pipeline, L.P.), with the exception of Sabine Pass Liquefaction, LLC and Sabine Pass LNG-LP, LLC.
The obligations under the Partnership’s senior secured credit facilities due 2024 (the “2019 CQP Credit Facilities”) are secured on a first-priority basis (subject to permitted encumbrances) with liens on (i) substantially all the existing and future tangible and intangible assets and rights of the Partnership and the Guarantors and equity interests in the Guarantors (except, in each case, for certain excluded properties set forth in the 2019 CQP Credit Facilities) and (ii) substantially all of the real property of SPLNG (except for excluded properties referenced in the 2019 CQP Credit Facilities). The Notes will be secured to the same extent as such obligations under our 2019 CQP Credit Facilities are so secured in the event that the aggregate amount of secured Indebtedness of the Partnership and the Guarantors (other than the Notes or any other series of notes issued under the Base Indenture) outstanding at any one time exceeds the greater of (i) $1.5 billion and (ii) 10% of net tangible assets (such period, the “Security Requirement Period”). The liens securing the Notes, if applicable, will be shared equally and ratably (subject to permitted liens) with the holders of other senior secured obligations, which include the 2019 CQP Credit Facilities obligations and any future additional senior secured debt obligations. As of the Issue Date, the Security Requirement Period will not be applicable, and the notes will be unsecured.
The Partnership may, at its option, redeem some or all of the Notes at any time on or after March 1, 2026, at the redemption prices set forth in the Fifth Supplemental Indenture. Prior to such time, the Partnership may redeem some or all of the Notes at a redemption price equal to 100% of the aggregate principal amount of the Notes redeemed, plus the “applicable premium” set forth in the Fifth Supplemental Indenture and accrued and unpaid interest, if any, to, but not including, the redemption date. In addition, before March 1, 2024, the Partnership may redeem up to 35% of the aggregate principal amount of the Notes with an amount of cash not greater than the net cash proceeds from certain equity offerings at a redemption price equal to 104.000% of the aggregate principal amount of the Notes redeemed, plus accrued and unpaid interest, if any, to, but not including, the redemption date.
The Notes Indenture also contains customary terms and events of default and certain covenants that, among other things, limit the ability of the Partnership and the Guarantors to incur liens and sell assets, the ability of the Partnership and its subsidiaries to enter into transactions with affiliates, the ability of the Partnership and the Guarantors to enter into
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