By Abigail W. Adams
Portland., Me., June 1 – Tellurian Inc. entered into definitive agreements to sell $500 million 6% senior secured convertible notes due May 1, 2025 on Wednesday with an initial conversion price of $5.724, according to a 424B5 filing with the Securities and Exchange Commission.
Roth Capital Partners LLC and Citigroup Global Markets Inc. served as placement agents for the offering.
Holders may put up to $166,666,000 of the initial principal amount of the notes at par on May 1, 2023 and May 1, 2024.
The notes are also putable upon a fundamental change.
The company may force conversion of the notes if stock closes above 200% of the conversion price for 20 consecutive trading days.
The notes are callable at a cash purchase price of 120% of the principal amount, which holders will have the option to accept or reject.
The notes are secured by a pledge of equity interests in subsidiary Tellurian Production Holdings LLC.
The convertible notes are subject to covenants including limitations on future debt, a minimum cash covenant, and limitations on liens, investments, distributions and asset transfers.
Proceeds will be used for general corporate purposes.
Tellurian is a Houston-based natural gas company.
| Issuer: | Tellurian Inc.
|
| Amount: | $500 million
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| Issue: | Convertible senior secured notes
|
| Maturity: | May 1, 2025
|
| Placement agents: | Roth Capital Partners LLC and Citigroup Global Markets Inc.
|
| Counsel to issuer: | Kirkland & Ellis LLP and Davis Graham & Stubbs LLP
|
| Counsel to agents: | Porter Hedges LLP and Davis Polk & Wardwell LLP
|
| Coupon: | 6%
|
| Conversion price: | $5.724
|
| Conversion rate: | 174.703
|
| Call options: | Optional call at a cash purchase price of 120% of the principal amount
|
| Put options: | Up to $166,666,000 of the initial principal amount of the notes at par on May 1, 2023 and May 1, 2024 or upon a fundamental change
|
| Pricing date: | June 1
|
| Settlement date: | June 3
|
| Distribution: | Off shelf
|
| Stock symbol: | NYSE: TELL
|
| Stock price: | $4.77 at market close May 31
|
| Market capitalization: | $2.49 billion
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