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Item 8. Financial Statements and Supplementary Data

2021-03-25 compared with 2020-03-03 · 559 added, 199 removed, 353 unchanged (68% of the section changed)

5 unchanged sentences

Consolidated Statements of Operations

Consolidated Statements of Stockholders’ Equity, Series A and Series B Convertible Preferred Stock

Consolidated Statements of Stockholders’

Equity, Series A and Series B Convertible Preferred Stock

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Supplemental Information to Consolidated Financial Statements – Summarized Quarterly Financial Data

Supplemental Information to Consolidated Financial Statements –

Summarized Quarterly Financial Data

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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Opinion on the financial statements

We have audited the accompanying consolidated balance sheets of NextDecade Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2019 and 2018, the related consolidated statements of operations, stockholders’ equity, series A and series B convertible preferred stock, and cash flows for the years then ended, and the related notes (collectively referred to as the “financial statements”).

We have audited the accompanying consolidated balance sheets of NextDecade Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2020 and 2019, the related consolidated statements of operations, stockholders’

equity, series A and series B convertible preferred stock, and cash flows for the years then ended, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Change in accounting principle

As discussed in Note 6 to the consolidated financial statements, the Company has changed its method of accounting for leases as of January 1, 2019 due to the adoption of Accounting Standards Codification Topic 842, Leases.

Basis for opinion

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provides a reasonable basis for our opinion.

We believe that our audits provide a reasonable basis for our opinion.

Critical audit matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Valuation of common stock warrant liabilities

As described further in Note 10 to the financial statements, the Company had $4.2 million of common stock warrant liabilities as of December 31, 2020.

At each balance sheet date, management determines the estimated fair value of common stock warrant liabilities using a Monte Carlo valuation method.

The following qualitative information is used by management to determine the fair value measurement of the common stock warrant liabilities:

stock price, exercise price, risk-free rate, volatility, and the warrants term in years, among other inputs.

We identified the valuation of common stock warrant liabilities as a critical audit matter.

The principal considerations for our determination that the valuation of common stock warrant liabilities is a critical audit matter are that (i) there was significant judgment by management when determining the estimated volatility, risk-free interest rate, and the expected life of the common stock warrants, and (ii) the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing procedures and evaluating the audit evidence obtained from these procedures.

Our audit procedures related to the valuation of common stock warrant liabilities included the following, among others.

We tested the design of controls over the valuation of common stock warrant liabilities and gained an understanding of the valuation credentials and industry expertise of the third-party valuation group and valuation methodologies used.

We tested the schedule of fully dilutive shares used to value common stock warrants by confirming outstanding common stock with the third-party transfer agent and testing the conversion value of preferred stock and dividend issuances.

With the assistance of Grant Thornton internal valuation specialists, we tested management’s and the third-party’s process for determining the fair value of common stock warrants, including evaluating significant assumptions used, testing supporting documents, and assessing reasonableness by comparing to historical trends and industry expectations.

Certain key inputs/assumptions tested by us included the following:

Risk-free interest rate

Warrant terms

Sale of Rio Bravo accounting treatment

As described further in Note 5 to the financial statements, on March 2, 2020, the Company completed the sale of Rio Bravo Pipeline Company, LLC (“Rio Bravo”) to Spectra Energy Transmission II, LLC, a wholly owned subsidiary of Enbridge, Inc ("Enbridge").

In connection with the closing of the sale, the Company entered into a precedent agreement where Rio Bravo agreed to provide the Company with firm natural gas transportation services on the proposed interstate natural gas pipeline in a quantity sufficient to match the full operational capacity of each proposed liquefaction train of the liquefied natural gas terminal.

Additionally, if the Company fails to issue a full notice to proceed to the terminal contractor on or prior to December 31, 2023, Enbridge has the right to sell the equity interests back to the Company, and the Company has the right to repurchase the equity interests from Enbridge.

Due to the aforementioned terms of the agreement, the proceeds from the sale of the equity interests and additional costs incurred by Enbridge are presented as a non-current liability and the assets of Rio Bravo have not been de-recognized in the consolidated balance sheet at December 31, 2020.

We identified the sale of Rio Bravo accounting treatment as a critical audit matter.

The principal considerations for our determination that the sale of Rio Bravo accounting treatment is a critical audit matter are (i) the complexity of the terms of the sale agreement, (ii) the complexity and judgment involved in the determination of the applicable accounting authoritative guidance, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing procedures and evaluating the audit evidence obtained from these procedures.

Our audit procedures related to the sale of Rio Bravo accounting treatment included the following, among others.

We read the sale agreement.

We tested management’s process for concluding on the accounting treatment of the sale of the equity interest in Rio Bravo, including management’s assumptions used to determine the accounting treatment in accordance with the sale agreement.

We used our firm specialist resources to assist in auditing management’s conclusions through an accounting consultation.

/s/ GRANT THORNTON LLP

We have served as the Company’s auditor since 2018.

Houston, Texas

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Cash and cash equivalents

$ 22,608  

$ 15,736  

Investment securities

62,207  

Prepaid expenses and other current assets

Total current assets

23,278  

78,802  

Property, plant and equipment, net

161,662  

134,591  

Operating lease right-of-use assets, net

Other non current assets

Liabilities, Series A and Series B Convertible Preferred Stock and Stockholders’ Equity

16,299  

$ 201,668  

$ 221,195  

Liabilities, Series A and Series B Convertible Preferred Stock and Stockholders’

Current liabilities

Accounts payable

$ 11,912  

Share-based compensation liability

Accrued liabilities and other current liabilities

Current Common Stock Warrant liabilities  

Current operating lease liabilities

Total current liabilities

21,543  

Non-current Common Stock Warrant liabilities

12,034  

Non-current operating lease liabilities

Other non-current liabilities  

22,916  

Total liabilities

28,933  

33,580  

Commitments and contingencies (Note 14)

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65,507 shares and 58,197 shares at December 31, 2020 and December 31, 2019, respectively

55,522  

48,084  

Series B Convertible Preferred Stock, $ 1,000 per share liquidation preference, Issued and outstanding:

62,612 shares and 55,645 shares at December 31, 2020 and December 31, 2019, respectively

Stockholders’ equity

56,781  

49,814  

Stockholders’

Common stock, $ 0.0001 par value Authorized:

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249,742 shares and 137,860 shares at December 31, 2020 and December 31, 2019, respectively, at cost

( 1,031 )  

Preferred stock, $ 0.0001 par value Authorized:

0.9 million, after designation of the Series A and Series B Convertible Preferred Stock, Issued and outstanding:

none at December 31, 2019 and December 31, 2018, respectively

none at December 31, 2020 and December 31, 2019

Additional paid-in-capital

209,481  

224,091  

Accumulated deficit

Total stockholders’ equity

Total liabilities, Series A and Series B Convertible Preferred Stock and stockholders’ equity

( 148,030 )  

Total stockholders’

60,432  

89,717  

Total liabilities, Series A and Series B Convertible Preferred Stock and stockholders’

$ 201,668  

$ 221,195  

The accompanying notes are an integral part of these Consolidated Financial Statements.

NextDecade Corporation and Subsidiaries

Consolidated Statements of Operations

(in thousands, except per share data)

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Other income (expense)

(Loss) gain on Common Stock Warrant liabilities

Gain (loss) on Common Stock Warrant liabilities

Loss on redemption of investment securities

Interest income, net

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NextDecade Corporation and Subsidiaries

Consolidated Statements of Stockholders’ Equity, Series A and Series B Convertible Preferred Stock

Consolidated Statements of Stockholders’

Equity, Series A and Series B Convertible Preferred Stock

(in thousands)

Treasury Stock

Comprehensive

Stockholders’

Preferred Stock

1 unchanged sentence

Balance at January 1, 2019

Adoption of ASC Topic 842

Adoption of ASU 2018-07

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Restricted stock vesting

Issuance of common stock net of equity issuance costs

Shares repurchased related to share-based compensation

Issuance of Series A preferred stock

Issuance of Series B preferred stock

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Balance at December 31, 2019

Adoption of ASC Topic 842

Adoption of ASU 2018-07

Share-based compensation

Restricted stock vesting

Issuance of common stock net of equity issuance costs

Shares repurchased related to share-based compensation

Issuance of Series B preferred stock

Preferred stock dividends

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Share-based compensation expense

Loss (gain) on Common Stock Warrant liabilities

(Gain) loss on investment securities

Realized gain on investment securities

(Gain) loss on Common Stock Warrant liabilities

Gain on investment securities

Realized loss (gain) on investment securities

Amortization of right-of-use assets

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Prepaid expenses

Other current assets

Accounts payable

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Acquisition of property, plant and equipment

Acquisition of other non-current assets

Proceeds from sale of investment securities

Purchase of investment securities

Acquisition of other non-current assets

Net cash used in investing activities

Net cash provided by (used in) investing activities

Financing activities:

Proceeds from sale of Rio Bravo Pipeline Company, LLC

Proceeds from equity issuance

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Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents – beginning of period

Cash and cash equivalents – end of period

Net increase in cash and cash equivalents

Cash and cash equivalents –

beginning of period

Cash and cash equivalents –

end of period

Non-cash investing activities:

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Accrued liabilities for acquisition of property, plant and equipment

Pipeline assets obtained in exchange for other non-current liabilities

Common stock issued in lieu of cash

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NextDecade Corporation and Subsidiaries

Notes to Consolidated Financial Statements

Note 1 — Background and Basis of Presentation

NextDecade Corporation engages in development activities related to the liquefaction and sale of liquefied natural gas (“LNG”).

We have focused and continue to focus our development activities on the Rio Grande LNG terminal facility at the Port of Brownsville in southern Texas (the “Terminal”) and an associated 137-mile Rio Bravo pipeline to supply natural gas to the Terminal (the “Pipeline”).

We also lease a 994-acre site near Texas City, Texas for another potential LNG terminal (the “Galveston Bay Terminal”) that expires December 31, 2020.

Our Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Notes to Consolidated Financial Statements

1  —

Background and Basis of Presentation

NextDecade Corporation engages in development activities related to the liquefaction and sale of liquefied natural gas (“LNG”).

We have focused and continue to focus our development activities on the Rio Grande LNG terminal facility at the Port of Brownsville in southern Texas (the “Terminal”). 

Our Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

All intercompany accounts and transactions have been eliminated in consolidation.

Certain reclassifications have been made to conform prior period information to the current presentation.

The reclassifications did not have a material effect on our consolidated financial position, results of operations or cash flows.

Note 2 — Summary of Significant Accounting Policies

Note 2 —

Summary of Significant Accounting Policies

Use of Estimates

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regulatory approval is probable;

construction financing is expected to be available at the time of a final investment decision (“FID”);

prospective customers have been identified and the FID is probable;

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If the carrying value of the asset is not recoverable, the amount of impairment loss is measured as the excess, if any, of the carrying value of the asset over its estimated fair value.

The Company determines the accounting classification of warrants that are issued, as either liability or equity, by first assessing whether the warrants meet liability classification in accordance with Accounting Standards Codification (“ASC”) 480 Distinguishing Liabilities from Equity (“ASC 480”), and then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock (“ASC 815-40”).

), and then in accordance with ASC 815 - 40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock (“ASC 815 - 40”

Under ASC 480, warrants are considered liability classified if the warrants are mandatorily redeemable, obligate the issuer to settle the warrants or the underlying shares by paying cash or other assets, or warrants that must or may require settlement by issuing a variable number of shares.

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In determining fair value, we use observable market data when available, or models that incorporate observable market data.

In addition to market information, we incorporate transaction-specific details that, in management’s judgment, market participants would take into account in measuring fair value.

We maximize the use of observable inputs and minimize our use of unobservable inputs in arriving at fair value estimates.

Recurring fair-value measurements are performed for investment securities as disclosed in Note 4 – Investment Securities and for Common Stock Warrant liabilities as disclosed in Note 9 – Preferred Stock and Common Stock Warrants .

Recurring fair-value measurements are performed for investment securities as disclosed in Note 4 –

Investment Securities and for Common Stock Warrant liabilities as disclosed in Note 10  

Preferred Stock and Common Stock Warrants .

The carrying amount of cash and cash equivalents and accounts payable reported on the Consolidated Balance Sheets approximates fair value due to their short-term maturities.

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Net Loss Per Share

Net loss per share (“EPS”) is computed in accordance with GAAP.

Basic EPS excludes dilution and is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period.

1 unchanged sentence

The dilutive effect of unvested stock and warrants is calculated using the treasury-stock method and the dilutive effect of convertible securities is calculated using the if-converted method.

Basic and diluted EPS for all periods presented are the same since the effect of our potentially dilutive securities are anti-dilutive to our net loss per share, as disclosed in Note 10 – Net Loss Per Share Attributable to Common Stockholders .

Basic and diluted EPS for all periods presented are the same since the effect of our potentially dilutive securities are anti-dilutive to our net loss per share, as disclosed in Note 11  –

Net Loss Per Share Attributable to Common Stockholders .

Share-based Compensation

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For equity-classified share-based compensation awards, compensation cost is recognized based on the grant-date fair value using the quoted market price of our common stock and not subsequently remeasured.

The fair value is recognized as expense, net of any capitalization, using the straight-line basis for awards that vest based on service conditions and using the graded-vesting attribution method for awards that vest based on performance conditions.

The fair value is recognized as expense, net of any capitalization, using the straight-line basis for awards that vest based on service conditions and using the graded-vesting attribution method for awards that vest based on performance conditions.

We estimate the service periods for performance awards utilizing a probability assessment based on when we expect to achieve the performance conditions.

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We account for forfeitures as they occur.

Provisions for income taxes are based on taxes payable or refundable for the current year and deferred taxes on temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements.

Provisions for income taxes are based on taxes payable or refundable for the current year and deferred taxes on temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements.

Deferred tax assets and liabilities are included in the Consolidated Financial Statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled.

As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the current period’s provision for income taxes.

A valuation allowance is recorded to reduce the carrying value of our net deferred tax assets when it is more likely than not that a portion or all of the deferred tax assets will expire before realization of the benefit or future deductibility is not probable.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the tax position.

Emerging Growth Company and Smaller Reporting Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

An “emerging growth company” may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We may take advantage of these reporting exemptions until we are no longer an emerging growth company.

Further, section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until such time as those standards apply to private companies.

The Company has elected to “opt-out” of this exemption and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Additionally, under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company qualifies as a “smaller reporting company” because the value of its common stock held by non-affiliates as of the end of its most recently completed second fiscal quarter was less than $250 million.

For as long as the Company remains a smaller reporting company, it may take advantage of certain exemptions from the SEC’s reporting requirements that are otherwise applicable to public companies that are not smaller reporting companies.

Note 3 — Prepaid Expenses and Other Current Assets

Smaller Reporting Company

Under Rule 12b - 2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company qualifies as a “smaller reporting company”

because the value of its common stock held by non-affiliates as of the end of its most recently completed second fiscal quarter was less than $250 million.

Note 3 —

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):

Rio Grande LNG site option

Prepaid subscriptions

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Total prepaid expenses and other current assets

During the years ended December 31, 2019 and 2018 , we recognized $486 thousand and $572 thousand, respectively, of lease option expense related to the Rio Grande LNG site option which expired November 5, 2019.

Note 4 — Investment Securities

We have invested in Class L shares of the JPMorgan Managed Income Fund.

The JPMorgan Managed Income Fund has an average maturity of approximately one year, duration of approximately six months, and approximately 24% of such fund’s holdings are AAA-rated with 0% non-investment grade rated.

Note 4 —

Investment Securities

We previously invested in Class L shares of the JPMorgan Managed Income Fund.

In March 2020, we redeemed the balance of the JPMorgan Managed Income Fund and realized a loss of $0.4 million.

Investment securities are included in Level 1 of the fair value hierarchy and consisted of the following (in thousands):

JPMorgan Managed Income Fund

Note 5 — Property, Plant and Equipment

Note 5  —

Sale of Equity Interests in Rio Bravo Pipeline Company, LLC

On March 2, 2020, NextDecade LLC closed the transactions (the “Closing”) contemplated by that certain Omnibus Agreement, dated February 13, 2020, with Spectra Energy Transmission II, LLC, a wholly owned subsidiary of Enbridge Inc.

(“Buyer”), pursuant to which NextDecade LLC sold one hundred percent of the equity interests (the “Equity Interests”) in Rio Bravo Pipeline Company, LLC (“Rio Bravo”) to Buyer for consideration of approximately $ 19.4 million.

Buyer paid $ 15.0 million of the purchase price to NextDecade LLC at the Closing and the remainder will be paid within five business days after the date that Rio Grande has received, after a final positive investment decision, the initial funding of financing for the development, construction and operation of the Terminal.

In connection with the Closing, Rio Grande LNG Gas Supply LLC, an indirect wholly-owned subsidiary of the Company (“Rio Grande Gas Supply”), entered into (i) a Precedent Agreement for Firm Natural Gas Transportation Service for the Rio Bravo Pipeline (the “RBPL Precedent Agreement”) with Rio Bravo and (ii) a Precedent Agreement for Natural Gas Transportation Service (the “VCP Precedent Agreement”) with Valley Crossing Pipeline, LLC (“VCP”).

VCP and, as of the Closing, Rio Bravo are wholly owned subsidiaries of Enbridge Inc.

The Valley Crossing Pipeline is owned and operated by VCP.

Pursuant to the RBPL Precedent Agreement, Rio Bravo agreed to provide Rio Grande Gas Supply with firm natural gas transportation services on the Pipeline in a quantity sufficient to match the full operational capacity of each proposed liquefaction train of the Terminal.

Rio Bravo’s obligation to construct, install, own, operate and maintain the Pipeline is conditioned on its receipt, no later than December 31, 2023, of notice that Rio Grande Gas Supply or its affiliate has issued a full notice to proceed to the engineering, procurement and construction contractor (the “EPC Contractor”) for the construction of the Terminal.

Under the RBPL Precedent Agreement, in consideration for the provision of such firm transportation services, Rio Bravo will be remunerated on a dollar-per-dekatherm, take-or-pay basis, subject to certain adjustments, over a term of at least twenty years, all in compliance with the federal and state authorizations associated with the Pipeline.

Pursuant to the VCP Precedent Agreement, VCP agreed to provide Rio Grande Gas Supply with natural gas transportation services on the Valley Crossing Pipeline in a quantity sufficient to match the commissioning requirements of each proposed liquefaction train of the Terminal.

VCP’s obligation to construct, install, own, operate and maintain the necessary interconnection to the Terminal and the Pipeline is conditioned on its receipt, no later than December 31, 2023, of notice that Rio Grande Gas Supply or its affiliate has issued a full notice to proceed to the EPC Contractor for the construction of the Terminal.

VCP will be responsible, at its sole cost and expense, to construct, install, own, operate and maintain the tap, riser and valve facilities (the “VCP Transporter Facilities”), which shall connect to Rio Grande Gas Supply’s custody transfer meter and such other facilities as necessary in order for the Terminal to receive gas from the VCP Transporter Facilities (the “Rio Grande Gas Supply Facilities”).

Rio Grande Gas Supply will be responsible, at its sole cost and expense, to construct, install, own, operate and maintain the Rio Grande Gas Supply Facilities.

Under the VCP Precedent Agreement, in consideration for the provision of the commissioning transportation services, VCP will be remunerated on the same dollar-per-dekatherm, take-or-pay basis as set forth in the RBPL Precedent Agreement for the duration of such commissioning services, all in compliance with the federal and state authorizations associated with the Valley Crossing Pipeline.

If Rio Grande or its affiliate fail to issue a full notice to proceed to the EPC Contractor on or prior to December 31, 2023, Buyer has the right to sell the Equity Interests back to NextDecade LLC and NextDecade LLC has the right to repurchase the Equity Interests from Buyer, in each case at a price not to exceed $ 23 million.

Accordingly, the proceeds from the sale of the Equity Interests and additional costs incurred by Buyer are presented as a non-current liability and the assets of Rio Bravo have not been de-recognized in the consolidated balance sheet at December 31, 2020.

Note 6 —

Property, Plant and Equipment

Property, plant and equipment consisted of the following (in thousands):

3 unchanged sentences

accumulated depreciation

( 660 )  

Total fixed assets, net

Terminal and Pipeline Assets (not placed in service)

140,253  

121,081  

21,017  

12,798  

Total Terminal and Pipeline assets

161,270  

133,879  

Total property, plant and equipment, net

Depreciation expense for the years ended December 31, 2019 and 2018 was $251 thousand and $171 thousand, respectively.

Note 6 — Leases

$ 161,662  

$ 134,591  

Depreciation expense for the years ended 

December 31, 2020 and 2019 was $ 196 thousand and $ 251 thousand, respectively.

Note 7  —

We currently lease approximately 25,600 square feet of office space for general and administrative purposes in Houston, Texas under a lease agreement that expires on September 30, 2021.

In January 2017, NextDecade LLC executed surface lease agreements with the City of Texas City and the State of Texas for a 994-acre site for the Galveston Bay Terminal (collectively, the “Galveston Bay Leases”).

The term of the Galveston Bay Leases is 36 months with an option to extend for an additional 12 months.

Such option was included in the measurement of Operating lease right-of-use assets and Operating lease liabilities and was exercised in the fourth quarter of 2019.

On March 6, 2019, Rio Grande entered into a lease agreement (the “Rio Grande Site Lease”) with the Brownsville Navigation District of Cameron County, Texas (“BND”) pursuant to which it has agreed to lease approximately 984 acres of land situated in Brownsville, Cameron County, Texas for the purposes of constructing, operating, and maintaining the Terminal and gas treatment and gas pipeline facilities.

The initial term of the Rio Grande Site Lease is for 30 years (the “Primary Term”), which will commence on the date specified in a written notice by Rio Grande to BND (the “Effective Date Notice”), if given, confirming that Rio Grande or a Rio Grande affiliate has made a positive FID for the first phase of the Terminal.

Under the Rio Grande Site Lease, the Effective Date Notice was to be delivered no later than November 6, 2019 (the “Outside Effective Date”) unless Rio Grande was unable to deliver the Effective Date Notice prior to the Outside Effective Date due to reasons unrelated to its own acts or omissions or its inability to secure one or more of the required permits for the Terminal.

In such a case, the Outside Effective Date would be automatically extended on a month-to-month basis (the “Effective Date Notice Extension Period”).

Rio Grande has the option to renew and extend the term of the Rio Grande Site Lease beyond the Primary Term for up to two consecutive renewal periods of ten years each provided that Rio Grande has not caused an event of default under the Rio Grande Site Lease.

Rio Grande did not deliver the Effective Date Notice prior to the Outside Effective Date due to not having obtained the required permits for the Terminal prior to the Outside Effective Date and, therefore, the Outside Effective Date has been automatically extended on a month-to-month basis.

In adopting Topic 842, the Company has elected the “package of practical expedients,” which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs.

On March 6, 2019, Rio Grande entered into a lease agreement (the “Rio Grande Site Lease”) with the Brownsville Navigation District of Cameron County, Texas (“BND”) pursuant to which it has agreed to lease approximately 984 acres of land situated in Brownsville, Cameron County, Texas for the purposes of constructing, operating, and maintaining the Terminal and gas treatment and gas pipeline facilities.

Under the Rio Grande Site Lease, the Effective Date Notice was to be delivered no later than November 6, 2019 ( the “Outside Effective Date”) unless Rio Grande was unable to deliver the Effective Date Notice prior to the Outside Effective Date due to reasons unrelated to its own acts or omissions or its inability to secure one or more of the required permits for the Terminal.

In such a case, the Outside Effective Date would be automatically extended on a month-to-month basis (the “Effective Date Notice Extension Period”).

On April 30, 2020, Rio Grande and the BND amended the Rio Grande Site Lease (the “Rio Grande Site Lease Amendment”) to extend the effective date for commencing the Rio Grande Site Lease to May 6, 2021 ( the “Effective Date”).

The Rio Grande Site Lease Amendment further provides that Rio Grande has the right, exercisable in its sole discretion, to extend the Effective Date to May 6, 2022 by providing the BND with written notice of its election no later than the close of business on the Effective Date.

In January 2017, NextDecade LLC executed surface lease agreements with the City of Texas City and the State of Texas for a 994 -acre site for a potential second U.S.

LNG project (collectively, the “Galveston Bay Leases”).

The term of the Galveston Bay Leases is 36 months with an option to extend for an additional 12 months.  Such option was included in the measurement of Operating lease right-of-use assets and Operating lease liabilities and was exercised in the fourth quarter of 2019.

The Galveston Bay Leases were not renewed upon expiration on December 31, 2020.

In adopting Topic 842, the Company has elected the “package of practical expedients,”

which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs.

The Company also elected the use-of-hindsight and the practical expedient pertaining to land easements.

3 unchanged sentences

The Company determines if a contractual arrangement represents or contains a lease at inception.

Operating leases with lease terms greater than twelve months are included in Operating lease right-of-use assets and Operating lease liabilities in the Consolidated Balance Sheets.

Operating lease right-of-use assets and lease liabilities are recognized at the commencement date based on the present value of the future lease payments over the lease term.

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The Company accounts for non-lease components separately from the lease component.

Operating lease right-of-use assets as of December 31, 2019 are as follows (in thousands):

Operating lease right-of-use assets are as follows (in thousands):

December 31,  

Office leases

Total operating lease right-of-use assets, net

Operating lease liabilities as of December 31, 2019 are as follows (in thousands):

$ 1,054  

Operating lease liabilities are as follows (in thousands):

December 31,  

Office leases

3 unchanged sentences

Total lease liabilities

Operating lease expense for the year ended December 31, 2019 is as follows (in thousands):

Operating lease expense is as follows (in thousands):

December 31,  

Office leases

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Total land option and lease expense

Maturity of operating lease liabilities as of December 31, 2019 are as follows (in thousands):

$ 1,603  

$ 2,039  

Maturity of operating lease liabilities as of 

December 31, 2020 are as follows (in thousands):

Total undiscounted lease payments

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Present value of lease liabilities

Other information related to our operating leases as of December 31, 2019 is as follows (in thousands):

Other information related to our operating leases as of 

December 31, 2020 is as follows (in thousands):

December 31,  

Cash paid for amounts included in the measurement of operating lease liabilities:

Cash flows from operating activities

$ 1,004  

$ 1,844  

Noncash right-of-use assets recorded for operating lease liabilities:

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In exchange for new operating lease liabilities during the period

Note 7 — Other Non-Current Assets

Note 8  —

Other Non-Current Assets

Other non-current assets consisted of the following (in thousands):

Permitting costs (1)

Enterprise resource planning system

Rio Grande Site Lease initial direct costs

Total other non-current assets

$ 7,385  

$ 2,637  

Enterprise resource planning system, net

Rio Grande Site Lease initial direct costs  

Total other non-current assets, net  

$ 16,299  

$ 6,748  

Permitting costs primarily represent costs incurred in connection with our permit applications to the United States Army Corps of Engineers and the U.S.

Fish and Wildlife Service for wetlands and habitat mitigation measures that may be caused by the construction of the Terminal and the Pipeline.

Note 8 — Accrued Liabilities and Other Current Liabilities

Fish and Wildlife Service for wetlands and habitat mitigation measures for potential impacts to wetlands and habitat that may be caused by the construction of the Terminal.

Note 9  —

Accrued Liabilities and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

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Terminal and Pipeline asset costs

Valve installation incentive (1)

Accrued legal services

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Total accrued liabilities and other current liabilities

In April 2018, we entered into an agreement with an intrastate pipeline company with assets near the Terminal which incentivizes the pipeline company to procure, permit and install a valve on an intrastate pipeline near the Terminal.

We agreed that, upon the later of (i) March 31, 2019 and (ii) thirty days after the date on which the valve was installed, we would reimburse the pipeline company a cash amount equal to 50% of the costs incurred in connection with the valve, up to a maximum payment of $2.0 million..

Such valve was installed in 2018 and we reimbursed the pipeline company $2.0 million in the first quarter of 2019 .

Note 9 — Preferred Stock and Common Stock Warrants

10  —

Preferred Stock and Common Stock Warrants

Preferred Stock

In August 2018, we sold an aggregate of 50,000 shares of Series A Convertible Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock), at $1,000 per share for an aggregate purchase price of $50 million and we issued an additional 1,000 shares of Series A Preferred Stock in aggregate as origination fees to (i) York Capital Management Global Advisors, LLC, severally on behalf of certain funds or accounts managed by it or its affiliates (“York”), (ii) Valinor Management, L.P., severally on behalf of certain funds or accounts for which it is investment manager (“Valinor”), (iii) Bardin Hill Investment Partners LP (formerly known as Halcyon Capital Management LP), severally on behalf of certain funds or accounts managed by it or its affiliates (“Bardin Hill,” and together with York and Valinor, the “Fund Purchasers”) and (iv) HGC NEXT INV LLC (“HGC” and, together with the Fund Purchasers, the “Series A Preferred Stock Purchasers”).

Warrants were issued together with the shares of Series A Preferred Stock (the “Series A Warrants”).

Each Fund Purchaser is a Company stockholder and, pursuant to that certain Agreement and Plan of Merger, dated as of April 17, 2017, by and among the Company, each Fund Purchaser and/or one or more of its affiliates, and the other parties named therein, three individuals, two individuals, and one individual from York, Valinor, and Bardin Hill, respectively, were appointed to the Company’s board of directors.

In September 2018, we sold an aggregate of 29,055 shares of Series B Convertible Preferred Stock, par value $0.0001 per share (the “Series B Preferred Stock” and, together with the Series A Preferred Stock, the “Convertible Preferred Stock”), at $1,000 per share for an aggregate purchase price of $29.055 million and we issued an additional 581 shares of Series B Preferred Stock in aggregate as origination fees to certain funds managed by BlackRock (“BlackRock”).

In May 2019, we sold an aggregate of 20,945 shares of Series B Preferred Stock, at $1,000 per share for an aggregate purchase price of $20.945 million and we issued an additional 418 shares of Series B Preferred Stock in aggregate as origination fees to York Tactical Energy Fund, L.P.

In August 2018, the Company sold an aggregate of 50,000 shares of Series A Convertible Preferred Stock, par value $ 0.0001 per share (the “Series A Preferred Stock), at $ 1,000  per share for an aggregate purchase price of $ 50 million and issued an additional 1,000 shares of Series A Preferred Stock in aggregate as origination fees to (i) York Capital Management Global Advisors, LLC, severally on behalf of certain funds or accounts managed by it or its affiliates (“York”), (ii) Valinor Management, L.P., severally on behalf of certain funds or accounts for which it is investment manager (“Valinor”), (iii) Bardin Hill Investment Partners LP (formerly known as Halcyon Capital Management LP), severally on behalf of certain funds or accounts managed by it or its affiliates (“Bardin Hill,”

and together with York and Valinor, the “Fund Purchasers”) and (iv) HGC NEXT INV LLC (“HGC”

and, together with the Fund Purchasers, the “Series A Preferred Stock Purchasers”).

Warrants were issued together with the shares of Series A Preferred Stock (the “Series A Warrants”). 

In connection with the issuance of Series A Preferred Stock and pursuant to backstop commitment agreements with the Fund Purchasers dated April 11, 2018, as subsequently amended on August 3, 2018 ( as amended, the “Backstop Agreements”), the Company also issued a total of 413,658 shares of Company common stock as fees to the Fund Purchasers.  Each Fund Purchaser is a Company stockholder and, pursuant to that certain Agreement and Plan of Merger, dated as of April 17, 2017, by and among the Company, each Fund Purchaser and/or one or more of its affiliates, and the other parties named therein, three individuals, two individuals, and one individual from York, Valinor, and Bardin Hill, respectively, were appointed to the Company’s board of directors. 

In September 2018, the Company sold an aggregate of 29,055 shares of Series B Convertible Preferred Stock, par value $ 0.0001 per share (the “Series B Preferred Stock”

and, together with the Series A Preferred Stock, the “Convertible Preferred Stock”), at $ 1,000 per share for an aggregate purchase price of $ 29.055 million and the Company issued an additional 581 shares of Series B Preferred Stock in aggregate as origination fees to certain funds managed by BlackRock, Inc.

(“BlackRock”).

In May 2019, the Company sold an aggregate of 20,945 shares of Series B Preferred Stock, at $ 1,000 per share for an aggregate purchase price of $ 20.945 million and we issued an additional 418 shares of Series B Preferred Stock in aggregate as origination fees to York Tactical Energy Fund, L.P.

and York Tactical Energy Fund PIV-AN, L.P.

(the “York Tactical Funds” and, together with BlackRock, Bardin Hill, Valinor and HGC, the “Series B Preferred Stock Purchasers”), (ii) Bardin Hill, (iii) Valinor and (iv) HGC.

Warrants were issued together with the shares of Series B Preferred Stock (the “Series B Warrants” and, together with the Series A Warrants, the “Common Stock Warrants”).

The Company has the option to convert all, but not less than all, of the Convertible Preferred Stock into shares of Company common stock at a strike price of $7.34 per share of Company common stock (the “Conversion Price”) on any date on which the volume weighted average trading price of shares of Company common stock for each trading day during any 60 of the prior 90 trading days is equal to or greater than 175% of the Conversion Price, in each case subject to certain terms and conditions.

(the “York Tactical Funds”

and, together with BlackRock, Bardin Hill, Valinor and HGC, the “Series B Preferred Stock Purchasers”), (ii) Bardin Hill, (iii) Valinor and (iv) HGC.

Warrants were issued together with the shares of Series B Preferred Stock (the “Series B Warrants”

and, together with the Series A Warrants, the “Common Stock Warrants”).

The Company has the option to convert all, but not less than all, of the Convertible Preferred Stock into shares of Company common stock at a strike price of $ 7.34 per share of Company common stock (the “Conversion Price”) on any date on which the volume weighted average trading price of shares of Company common stock for each trading day during any 60 of the prior 90 trading days is equal to or greater than 175 % of the Conversion Price, in each case subject to certain terms and conditions.

Furthermore, the Company must convert all of the Convertible Preferred Stock into shares of Company common stock at the Conversion Price on the earlier of (i) ten ( 10 ) business days following a FID Event (as defined in the certificates of designations of the Convertible Preferred Stock) and (ii) the date that is the tenth ( 10th ) anniversary of the closings of the issuances of the Convertible Preferred Stock, as applicable.

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Such dividends are payable quarterly and may be paid in cash or in-kind.

During 2019 , the Company paid-in-kind $11.2 million of dividends to holders of the Convertible Preferred Stock.

During the 

twelve months ended December 31, 2020 and 2019  the Company paid-in-kind $ 14.3 million and $ 11.2  million of dividends, respectively, to holders of the Convertible Preferred Stock.

On January 12, 2021, the Company declared dividends to holders of the Convertible Preferred Stock as of the close of business on December 15, 2020.

On January 15, 2021, the Company paid-in-kind $ 3.9 million of dividends to holders of the Convertible Preferred Stock.

The holders of Convertible Preferred Stock vote on an “as-converted” basis with the holders of the Company common stock on all matters brought before the holders of Company common stock.

The holders of Convertible Preferred Stock vote on an “as-converted”

basis with the holders of the Company common stock on all matters brought before the holders of Company common stock.

In addition, the holders of Convertible Preferred Stock have separate class voting rights with respect to certain matters affecting their rights.

The Convertible Preferred Stock do not qualify as liability instruments under ASC 480, because they are not mandatorily redeemable.

However, as SEC Regulation S-X, Rule 5-02-27 does not permit a probability assessment for a change of control provision, the Convertible Preferred Stock must be presented as mezzanine equity between liabilities and stockholders’ equity in our Consolidated Balance Sheets because a change of control event, although not considered probable, could force the Company to redeem the Convertible Preferred Stock for cash or assets of the Company.

equity in our Consolidated Balance Sheets because a change of control event, could force the Company to redeem the Convertible Preferred Stock for cash or assets of the Company.

At each balance sheet date, we must re-evaluate whether the Convertible Preferred Stock continue to qualify for equity classification.

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The Series B Warrants issued to the Series B Preferred Stock Purchasers represent the right to acquire in the aggregate a number of shares of common stock equal to approximately 71 basis points ( 0.71 %) of all outstanding shares of Company common stock, measured on a fully diluted basis on the exercise date with a strike price of $ 0.01 per share.

The Common Stock Warrants have a fixed three-year term commencing on the closings of the issuances of the associated Convertible Preferred Stock.

The Common Stock Warrants have a fixed three -year term that commenced on the closings of the issuances of the associated Convertible Preferred Stock.

The Common Stock Warrants may only be exercised by holders of the Common Stock Warrants at the expiration of such three -year term, except that the Company can force the exercise of the Common Stock Warrants prior to expiration of such term if the volume weighted average trading price of shares of Common Stock for each trading day during any 60 of the prior 90 trading days is equal to or greater than 175% of the of the applicable Convertible Preferred Stock conversion price and, with respect to the Series B Warrants, the Company simultaneously elects to force a mandatory exercise of all other warrants then outstanding and un-exercised and held by any holder of parity stock.

Pursuant to ASC 815 - 40 , the fair value of the Common Stock Warrants was recorded as a non-current liability on our Consolidated Balance Sheet on the issuance dates.

The Company revalues the Common Stock Warrants at each balance sheet date and recognized a loss of $2.7 million and a gain of $0.2 million as of December 31, 2019 and 2018, respectively.

The Company revalues the Common Stock Warrants at each balance sheet date and recognized a gain of $ 7.9 million and a loss of $ 2.7 million as of December 31, 2020 and 2019 , respectively.

The Common Stock Warrant liabilities are included in Level 3 of the fair value hierarchy.

The assumptions used in the Monte Carlo simulation to estimate the fair value of the Common Stock Warrants as of December 31, 2019 are as follows:

The assumptions used in the Monte Carlo simulation to estimate the fair value of the Common Stock Warrants as of 

December 31, 2020 are as follows:

Exercise price

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Initial Fair Value Allocation

Net proceeds in 2019 were allocated on a fair value basis to the Series B Warrants and on a relative fair value basis to the Series B Preferred Stock.

The allocation of net cash proceeds from the sale of Series B Preferred Stock in 2019 is as follows (in thousands):

Year Ended December 31, 2019

Gross proceeds

Equity issuance costs

Net proceeds - Initial Fair Value Allocation

Per balance sheet upon issuance

Net cash proceeds in 2018 were allocated on a fair value basis to the Series A Warrants and the Series B Warrants and on a relative fair value basis to the Company common stock, the Series A Preferred Stock and the Series B Preferred Stock.

As described below, $2.5 million of the $41.1 million allocated to the Series A Preferred Stock was allocated to additional paid-in capital to give effect to the intrinsic value of a beneficial conversion feature (“BCF”).

The allocation of net cash proceeds from the sale of Series A Preferred Stock and Series B Preferred Stock in 2018 is as follows (in thousands):

Net proceeds in 2019 were allocated on a fair value basis to the Series B Warrants and on a relative fair value basis to the Series B Preferred Stock. 

The allocation of net cash proceeds from the sale of Series B Preferred Stock in 2019  is as follows (in thousands):

Year Ended December 31, 2019

Additional Paid-in Capital

Gross proceeds

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Net proceeds - Initial Fair Value Allocation

Allocation to BCF

Per balance sheet upon issuance

Beneficial Conversion Feature

ASC 470-20-20 – Debt – Debt with conversion and Other Options (“ASC 470-20”) defines a BCF as a nondetachable conversion feature that is in the money at the issuance date.

ASC 470 - 20 - 20 –

Debt –

Debt with conversion and Other Options (“ASC 470 - 20”

) defines a BCF as a nondetachable conversion feature that is in the money at the issuance date.

The Company was required by ASC 470 - 20 to allocate a portion of the proceeds from the Series A Preferred Stock equal to the intrinsic value of the BCF to additional paid-in capital.

The intrinsic value of the BCF is calculated at the issuance date as the difference between the “accounting conversion price” and the market price of shares of Company common stock multiplied by the number of shares of Company common stock into which the Series A Preferred Stock is convertible.

The intrinsic value of the BCF is calculated at the issuance date as the difference between the “accounting conversion price”

and the market price of shares of Company common stock multiplied by the number of shares of Company common stock into which the Series A Preferred Stock is convertible.

The accounting conversion prices of $ 5.58 per share and $ 6.24 per share for the Fund Purchasers and HGC, respectively, is different than the initial conversion price of $ 7.50 per share.

The “accounting conversion price” is derived by dividing the proceeds allocated to the Series A Preferred Stock by the number of shares of Company common stock into which the Series A Preferred Stock is convertible.

The “accounting conversion price”

is derived by dividing the proceeds allocated to the Series A Preferred Stock by the number of shares of Company common stock into which the Series A Preferred Stock is convertible.

We are recording the accretion of the $ 2.5 million Series A Preferred Stock discount attributable to the BCF as a deemed dividend using the effective yield method over the period prior to the expected conversion date.

Note 10 — Net Loss Per Share Attributable to Common Stockholders

11  —

Net Loss Per Share Attributable to Common Stockholders

The following table (in thousands, except for loss per share) reconciles basic and diluted weighted average common shares outstanding for the years ended December 31, 2020 and 2019 :

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Convertible preferred stock

16,635  

13,697  

Common Stock Warrants

IPO Warrants (2)

12,082  

Total potentially dilutive common shares

Does not include 3.6 million shares and 10.8 million shares of unvested stock for the year ended December 31, 2019 and 2018 because the performance conditions had not yet been satisfied as of December 31, 2019 and 2018 , respectively.

The IPO Warrants are exercisable at a price of $11.50 per share and expire July 24, 2022.

The Company may redeem the Warrants at a price of $0.01 per IPO Warrant upon 30 days’ notice only if the last sale price of our common stock is at least $17.50 per share for any 20 trading days within a 30-trading day period.

31,609  

28,302  

Does not include 2.1 million shares and 3.6 million shares of unvested stock for the year ended 

December 31, 2020 and 2019 because the performance conditions had not yet been satisfied as of  

December 31, 2020 and 2019 , respectively.

The IPO Warrants were issued in connection with our initial public offering and are exercisable at a price of $ 11.50 per share and expire July 24, 2022.

The Company may redeem the Warrants at a price of $ 0.01 per IPO Warrant upon 30 days’

notice only if the last sale price of our common stock is at least $ 17.50 per share for any 20 trading days within a 30 -trading day period.

If the Company redeems the IPO Warrants in this manner, the Company will have the option to do so on a cashless basis with the issuance of an economically equivalent number of shares of Company common stock.

Note 11 — Share-based Compensation

We have granted shares of Company common stock and restricted stock to employees, consultants and non-employee directors under our 2017 Omnibus Incentive Plan (the “2017 Plan”) and in connection with the special meeting of stockholders on July 24, 2017.

Note 12 —

Share-based Compensation

Total share-based compensation consisted of the following (in thousands):

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Equity awards

$ ( 155 )  

Liability awards

Total share-based compensation

( 155 )  

Capitalized share-based compensation

( 186 )  

Total share-based compensation expense

On January 1, 2019, we adopted Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock Compensation (“ASU 2018-07”).

$ ( 341 )  

On January 1, 2019, we adopted Accounting Standards Update (“ASU”) 2018 - 07, Compensation-Stock Compensation (“ASU 2018 - 07”

This standard simplifies aspects of share-based compensation issued to non-employees by making the guidance consistent with accounting for employee share-based compensation.

Upon adoption of this standard, we reclassified $ 2.1 million from Share-based compensation liability to Additional paid-in-capital in our Consolidated Balance Sheets.

Certain employee contracts provided for cash bonuses upon a positive FID in the Terminal (the “FID Bonus”).

In January 2018, the Compensation Committee (formerly the Nominating, Corporate Governance and Compensation Committee) of the board of directors approved, and certain employees party to such contracts accepted, an amendment to such contracts whereby the FID Bonuses would be settled in shares of Company common stock equal to 110 % of the FID Bonus.

The associated liability for FID Bonuses to be settled in shares of Company common stock of $0.2 million and $0.4 million is included in share-based compensation liability in our Consolidated Balance Sheets at December 31, 2019 and 2018 respectively.

The total unrecognized compensation costs at December 31, 2019 relating to equity-classified awards were $7.3 million, which is expected to be recognized over a weighted average period of 0.9 years.

Restricted stock awards are awards of Company common stock that are subject to restrictions on transfer and to a risk of forfeiture if the recipient’s employment with the Company is terminated prior to the lapse of the restrictions.

The associated liability for FID Bonuses to be settled in shares of Company common stock of $ 0.2  million is included in share-based compensation liability in our Consolidated Balance Sheets at each of 

December 31, 2020 and 2019 .

The total unrecognized compensation costs at 

December 31, 2020 relating to equity-classified awards were $ 3.1 million, which is expected to be recognized over a weighted average period of 1.0 years.

Restricted stock awards vest based on service conditions and/or performance conditions.

The amortization of the value of restricted stock grants is accounted for as a charge to compensation expense, or capitalized, depending on the nature of the services provided by the employee, with a corresponding increase to additional-paid-in-capital over the requisite service period.

Grants of restricted stock to employees, non-employees and non-employee directors that vest based on service and/or performance conditions are measured at the closing quoted market price of our common stock on the grant date.

The table below provides a summary of our restricted stock outstanding as of December 31, 2019 and changes during the year ended December 31, 2019 (in thousands, except for per share information):

The table below provides a summary of our restricted stock outstanding as of 

December 31, 2020 and changes during the year ended 

December 31, 2020 (in thousands, except for per share information):

Weighted Average Grant Date Fair Value Per Share

Non-vested at January 1, 2020

$ 7.95  

( 612 )  

( 874 )  

Non-vested at December 31, 2020

Note 12 — Income Taxes

$ 8.05  

13  —

The reconciliation of the federal statutory income tax rate to our effective income tax rate is as follows:

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Valuation allowance

( 20 )  

Effective tax rate as reported

Significant components of our deferred tax assets and liabilities at December 31, 2019 and 2018 are as follows (in thousands):

Significant components of our deferred tax assets and liabilities at 

December 31, 2020 and 2019 are as follows (in thousands):

Deferred tax assets

Net operating loss carryforwards and credits

$ 20,698  

$ 15,064  

Share-based compensation expense

Property, plant and equipment

Common stock warrant liabilities

Operating lease liabilities

Common stock warrant liabilities  

Operating lease liabilities  

valuation allowance

( 22,669 )  

Total deferred tax assets

Deferred tax liabilities

Operating lease right-of-use assets

Common stock warrant liabilities  

( 1,129 )  

Operating lease Right-of-use assets  

( 1,583 )  

Total deferred tax liabilities

( 2,712 )  

Net deferred tax assets (liabilities)

The federal deferred tax assets presented above do not include the state tax benefits as our net deferred state tax assets are offset with a full valuation allowance.

At December 31, 2019 , we had federal net operating loss (“NOL”) carryforwards of approximately $71.7 million.

At December 31, 2020 , we had federal net operating loss (“NOL”) carryforwards of approximately $ 98.6  million.

Approximately $ 26.1 million of these NOL carryforwards will expire between 2034 and 2038.

1 unchanged sentence

We will continue to evaluate our ability to release the valuation allowance in the future.

Due to our full valuation allowance, we have not recorded a provision for federal or state income taxes during the years ended December 31, 2019 or 2018 .

Due to our full valuation allowance, we have not recorded a provision for federal or state income taxes during the years ended 

December 31, 2020 or 2019 . 

Deferred tax assets and deferred tax liabilities are classified as non-current in our Consolidated Balance Sheets.

The Tax Reform Act of 1986 (as amended) contains provisions that limit the utilization of NOL and tax credit carryforwards if there has been a change in ownership as described in Section 382 of the Internal Revenue Code (“Section 382”).

Substantial changes in the Company's ownership have occurred that may limit or reduce the amount of NOL carryforwards that the Company could utilize in the future to offset taxable income.

The Company has not completed a detailed Section 382 study at this time to determine what impact, if any, that ownership changes may have had on its NOL carryforwards.

In each period since its inception, the Company has recorded a valuation allowance for the full amount of its deferred tax assets, as the realization of the deferred tax asset is uncertain.

As a result, the Company has not recognized any federal or state income tax benefit in its Consolidated Statement of Operations.

The Tax Reform Act of 1986 (as amended) contains provisions that limit the utilization of NOL and tax credit carryforwards if there has been a change in ownership as described in Section 

382 of the Internal Revenue Code (“Section 382”

Substantial changes in the Company's ownership have occurred that may limit or reduce the amount of NOL carryforwards that the Company could utilize in the future to offset taxable income.

The Company has not completed a detailed Section 

382 study at this time to determine what impact, if any, that ownership changes may have had on its NOL carryforwards. 

In each period since its inception, the Company has recorded a valuation allowance for the full amount of its deferred tax assets, as the realization of the deferred tax asset is uncertain.

As a result, the Company has not recognized any federal or state income tax benefit in its Consolidated Statement of Operations.

We remain subject to periodic audits and reviews by taxing authorities;

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The federal tax returns for the years beginning 2015 remain open for examination.

Note 13 — Commitments and Contingencies

In response to the global pandemic related to COVID- 19, the President signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) on March 27, 2020 and the Consolidated Appropriations Act, 2021 (the “CAA”) on December 27, 2020. 

The CARES Act and the CAA provide numerous relief provisions for corporate taxpayers, including modification of the utilization limitations on NOLs, favorable expansions of the deduction for business interest expense under Internal Revenue Code Section 163 (j), and the ability to accelerate timing of refundable alternative minimum tax credits. 

For the year ended December 31, 2020, there were no material tax impacts to our consolidated financial statements from the CARES Act, the CAA or other COVID- 19 measures. 

The Company continues to monitor additional guidance issued by the U.S.

Treasury Department, the Internal Revenue Service and others.

14  —

Commitments and Contingencies

Other Commitments

During the third quarter of 2019 , we entered into agreements with third parties for wetland and habitat mitigation measures.

In connection with the wetland and habitat mitigation measures, we are committed to spend approximately $5.5 million in 2020.

On March 6, 2019, Rio Grande entered into a lease agreement (the “Rio Grande Site Lease”) with the Brownsville Navigation District of Cameron County, Texas (“BND”) for the lease by Rio Grande of approximately 984 acres of land situated in Brownsville, Cameron County, Texas for the purposes of constructing, operating, and maintaining (i) a liquefied natural gas facility and export terminal and (ii) gas treatment and gas pipeline facilities.

In connection with the Rio Grande Site Lease Amendment, Rio Grande is committed to pay approximately $ 1.5 million per quarter to the BND through the earlier of the Effective Date and lease commencement.

Obligation under LNG Sale and Purchase Agreement

In March 2019, we entered into a 20 -year sale and purchase agreement (the “SPA”) with Shell NA LNG LLC (“Shell”) for the supply of approximately two million tonnes per annum of liquefied natural gas from the Terminal.

Pursuant to the SPA, Shell will purchase LNG on a free-on-board (“FOB”) basis starting from the date the first liquefaction train of the Terminal that is commercially operable, with approximately three -quarters of the purchased LNG volume indexed to Brent and the remaining volume indexed to domestic United States gas indices, including Henry Hub.

In the first quarter of 2020, pursuant to the terms of the SPA, the SPA became effective upon the conditions precedent in the SPA being satisfied or waived.

The SPA obligates Rio Grande to deliver the contracted volumes of LNG to Shell at the FOB delivery point, subject to the first liquefaction train at the Terminal being commercially operable.

Legal Proceedings

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We regularly analyze current information and, as necessary, provide accruals for liabilities we deem probable and estimable.

As of December 31, 2019 , management was not aware of any claims or legal actions that, separately or in the aggregate, are likely to have a material adverse effect on the Company’s financial position, results of operations or cash flows, although the Company cannot guarantee that a material adverse event will not occur.

Note 14 — Recent Accounting Pronouncements

The following table provides a brief description of recent accounting standards that were adopted by the Company during the reporting period:

As of December 31, 2020 , management was not aware of any claims or legal actions that, separately or in the aggregate, are likely to have a material adverse effect on the Company’s financial position, results of operations or cash flows, although the Company cannot guarantee that a material adverse event will not occur.

Note 15 —

Recent Accounting Pronouncements 

The following table provides a brief description of recent accounting standards that have not been adopted by the Company during the reporting period:

Date of Adoption

Effect on our Consolidated Financial Statements or Other Significant Matters

ASU 2016-02, Leases

This standard requires a lessee to recognize leases on its balance sheet by recording a lease liability representing the obligation to make future lease payments and a right-of-use asset representing the right to use the underlying asset for the lease term.

A lessee is permitted to make an election not to recognize lease assets and liabilities for leases with a term of 12 months or less.

The standard also modifies the definition of a lease and requires expanded disclosures.

This standard may be early adopted, and must be adopted using a modified retrospective approach with certain available practical expedients.

January 1, 2019

We have adopted this accounting standard using a prospective transition approach, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented.

Upon adoption of this standard, we recognized operating lease right-of use assets of $1.6 million and operating lease liabilities of $1.9 million.

See Note 6 - Leases of our Notes to Consolidated Financial Statements for additional details.

Compensation-Stock

Compensation (Topic

This standard simplifies aspects of share-based compensation issued to non-employees by making the guidance consistent with accounting for employee share-based compensation.

The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor's own operations by issuing share-based payment awards.

This standard may be early adopted, and must be adopted using a modified retrospective approach.

Effect on our Consolidated Financial Statements or Other Significant Matters

ASU 2020 - 06,  

Accounting for Convertible Instruments and Contracts in Entity's Own Equity (Subtopic 815 - 40 )

This standard requires entities to provide expanded disclosures about the terms and features of convertible instruments.

For convertible instruments, the instruments primarily affected are those issued with beneficial conversion features or cash conversion features because the accounting models for those specific features are removed.

January 1, 2022

Upon adoption of this standard, we reclassified $2.1 million from Share-based compensation liability to Additional paid-in-capital in our Consolidated Balance Sheets.

The fair value of share based compensation awards to non-employees will not be remeasured subsequent to December 31, 2018.

Intangibles, Goodwill

and Other Internal

(Subtopic 350-40 )

The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).

The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update.

Accordingly, the amendments in this update require an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense.

These amendments may be early adopted and are required to be applied retrospectively or prospectively to all implementation costs incurred after the date of adoption.

Upon adoption of this standard, we capitalized approximately $1.9 million of implementation costs incurred for our Enterprise Resource Planning system.

The capitalized costs will be amortized over the hosting period.

Note 15 — Subsequent Events

On February 13, 2020, NextDecade LLC entered into an Omnibus Agreement (the “Omnibus Agreement”) with Spectra Energy Transmission II, LLC, a wholly owned subsidiary of Enbridge Inc.

(“Buyer”), pursuant to which NextDecade LLC agreed to sell, and Buyer agreed to purchase, one hundred percent of the equity interests (the “Equity Interests”) in Rio Bravo.

The purchase price for the Equity Interests (the “Purchase Price”) will be the sum of (i) approximately $17.4 million plus (ii) the amount of direct and indirect costs incurred by Rio Bravo, the Company or any of its other affiliates in respect of the Pipeline from October 1, 2019 through closing of the sale of the Equity Interests (the “Closing”), provided, however, that the Purchase Price may not exceed $25 million.

At the Closing, Buyer will pay NextDecade LLC $15 million of the Purchase Price.

The carrying value of such Equity Interests was $12.6 million at December 31, 2019.

The remainder of the Purchase Price is to be paid within five business days after the date that Rio Grande has received, after a final positive investment decision, the initial funding for the development, construction and operation of the Terminal.

Additionally, the Omnibus Agreement provides that at the Closing, Rio Bravo and an indirect wholly owned subsidiary of the Company, will enter into a precedent agreement in a form negotiated by Buyer and NextDecade LLC pursuant to which the Company will retain its rights to the natural gas firm transportation capacity on the Pipeline for a term of at least twenty years and Rio Bravo will provide firm pipeline transportation service to the Company in order to supply natural gas to the Terminal.

On March 2, 2020, the Closing occurred and NextDecade LLC received proceeds of $15 million and Buyer received the Equity Interests in Rio Bravo.

In addition, Rio Grande LNG Gas Supply LLC (“Rio Grande Gas Supply”), an indirect wholly owned subsidiary of the Company, entered into precedent agreements with Rio Bravo and Valley Crossing Pipeline, LLC (“VCP”), pursuant to which Rio Grande Gas Supply will retain its rights to the natural gas firm transportation capacity on the Pipeline for a term of at least twenty years and Rio Bravo and VCP will provide firm pipeline transportation service to Rio Grande Gas Supply in order to supply natural gas to the Terminal.

VCP and, as of the Closing, Rio Bravo are wholly owned subsidiaries of Enbridge, Inc.

As a result of the sale of the Equity Interests, our commitment with respect to wetland and habitat mitigation measures, as disclosed in Note 13 - Commitments and Contingencies , is reduced from $5.5 million to $4.0 million.

We have evaluated subsequent events through March 3, 2020, the date the financial statements were issued.

We are currently evaluating the effect of this standard on our Consolidated Financial Statements.

Note 16  —

Subsequent Events

On March 17, 2021, the Company entered into a Series C Convertible Preferred Stock Purchase Agreement (collectively, the “Series C Stock Purchase Agreements”) with each of (i) York Capital Management, L.P.

and certain of its affiliates (“York”), (ii) certain affiliates of Bardin Hill Investment Partners LP (“Bardin Hill”), and (iii) Avenue Energy Opportunities Fund II, L.P (“Avenue”

and together with York and Bardin Hill, the “Purchasers”) pursuant to which the Company agreed to sell, and the Purchasers agreed to purchase shares of the Company’s Series C Convertible Preferred Stock, par value $ 0.0001 per share (the “Series C Preferred Stock”), together with associated warrants, for an aggregate purchase price of $ 24.5  million.  The consummation of the transactions contemplated by the Series C Stock Purchase Agreements occurred at multiple closings on or prior to March 22, 2021.

We have evaluated subsequent events through March 25, 2021, the date the financial statements were issued. 

Any material subsequent events that occurred during this time have been properly recognized and/or disclosed in these financial statements.

2 unchanged sentences

Summarized Quarterly Financial Data

Summarized Quarterly Financial Data – (in thousands, except per share amounts)

Summarized Quarterly Financial Data –

(in thousands, except per share amounts)

Year ended December 31, 2020:

8 unchanged sentences

Changes in and Disagreements with Accountants

Item 9A.

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of “our disclosure controls and procedures,”

as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the fiscal year ended December 31, 2020.

Based on this evaluation, our principal executive officer and principal financial officer have concluded that, as of December 31, 2020, our disclosure controls and procedures were effective.

Management’s Report on Internal Controls Over Financial Reporting

As management, we are responsible for establishing and maintaining adequate internal control over financial reporting for the Company.

In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002, we have conducted an assessment, including testing using the criteria in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

The Company’s system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and, even when determined to be effective, can only provide reasonable assurance with respect to financial statement preparation and presentation.

Based on our assessment, we have concluded that the Company maintained effective internal control over financial reporting as of December 31, 2020, based on criteria in Internal Control—Integrated Framework (2013) issued by the COSO.

The Company is neither an accelerated filer nor a large accelerated filer, as defined in Rule 12b-2 under the Exchange Act and, therefore, this Annual Report on Form 10-K does not include an audit report on internal control over financial reporting by the Company’s registered public accounting firm.

Management’s report on internal control over financial reporting for the year ended December 31, 2020 was not required to be attested by the Company’s registered public accounting firm pursuant to Item 308(b) of Regulation S-K.

Changes in Internal Control over Financial Reporting

During the most recent fiscal quarter, there were no changes in internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.

Other Information

Pursuant to paragraph 3 of General Instruction G to Form 10-K, the information required by Items 10 through 14 of Part III of this Report is incorporated by reference from NextDecade’s definitive proxy statement, which is to be filed pursuant to Regulation 14A of the Exchange Act within 120 days after the end of NextDecade’s fiscal year ended December 31, 2020.

Item 15.

Exhibit and Financial Statement Schedules

Financial Statements, Schedules and Exhibits

Financial Statements –

NextDecade Corporation and Subsidiaries:

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets

Consolidated Statements of Operations 

Consolidated Statements of Stockholders’

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Supplemental Information to Consolidated Financial Statements –

Summarized Quarterly Financial Data

Financial Statement Schedules:

All schedules are omitted because they are not applicable or the required information is shown in the financial statements or the notes thereto.

Exhibit No.

Second Amended and Restated Certificate of Incorporation of NextDecade Corporation, dated July 24, 2017

Amended and Restated Bylaws of NextDecade Corporation, dated July 24, 2017

Certificate of Designations of Series A Convertible Preferred Stock, dated August 9, 2018

Certificate of Designations of Series B Convertible Preferred Stock, dated September 28, 2018

Certificate of Designations of Series C Convertible Preferred Stock dated March 17, 2021

Certificate of Amendment to Certificate of Designations of Series A Convertible Preferred Stock, dated July 12, 2019

Certificate of Amendment to Certificate of Designations of Series B Convertible Preferred Stock, dated July 12, 2019

Certificate of Increase to Certificate of Designations of Series A Convertible Preferred Stock of NextDecade Corporation, dated July 15, 2019

Certificate of Increase to Certificate of Designations of Series B Convertible Preferred Stock of NextDecade Corporation, dated July 15, 2019

Amendment No.

1 to the Amended and Restated Bylaws of NextDecade Corporation

Specimen Common Share Certificate

Specimen 

IPO Warrant Certificate

Form of Warrant Agreement between Harmony Merger Corp.

and Continental Stock Transfer & Trust Company

Form of Warrant Agreement for the Series A Warrants

Form of Warrant Agreement for the Series B Warrants

Form of Warrant Agreement for the Series C Warrants

Description of Common Stock of NextDecade Corporation Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

10.1 (18)†

Employment Agreement, dated September 8, 2017, between NextDecade Corporation and Matthew K.

10.2 (19)†

NextDecade Corporation 2017 Omnibus Incentive Plan

10.3 (20)†

Form of Restricted Stock Award Agreement for Non-Executive Employees and Contractors

Form of Registration Rights Agreement

Purchaser Rights Agreement by and between NextDecade Corporation and HGC NEXT INV LLC

Form of Registration Rights Agreement.

Form of Purchaser Rights Agreement

Amendment No.

1 to Registration Rights Agreement, effective as of December 7, 2018, by and between NextDecade Corporation and York Capital Management Global Advisors, LLC, severally on behalf of certain funds or advised by it or its affiliates

Amendment No.

1 to Registration Rights Agreement, effective as of December 7, 2018, by and between NextDecade Corporation and Valinor Management L.P., severally on behalf of certain funds or accounts for which it is investment manager

Amendment No.

1 to Registration Rights Agreement, effective as of December 7, 2018, by and between NextDecade Corporation and Bardin Hill Investment Partners LP (formerly Halcyon Capital Management LP), on behalf of the accounts it manages

Amendment No.

1 to Employment Agreement, effective January 1, 2019, by and between NextDecade Corporation and Matthew K.

Lease Agreement, made and entered into March 6, 2019, by and between Brownsville Navigation District of Cameron County, Texas and Rio Grande LNG, LLC

Series B Convertible Preferred Stock Purchase Agreement, dated as of May 17, 2019, entered into by and between NextDecade Corporation and York Tactical Energy Fund, L.P.

Series B Convertible Preferred Stock Purchase Agreement, dated as of May 17, 2019, entered into by and between NextDecade Corporation and the Valinor Funds

Series B Convertible Preferred Stock Purchase Agreement, dated as of May 17, 2019, entered into by and between NextDecade Corporation and the Bardin Hill Funds

Series B Convertible Preferred Stock Purchase Agreement, dated as of May 17, 2019, entered into by and between NextDecade Corporation and HGC NEXT INV LLC

Form of Registration Rights Agreement

Form of Purchaser Rights Agreement

Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Trains 1 and 2 of the Rio Grande Natural Gas Liquefaction Facility by and between Rio Grande LNG, LLC as Owner and Bechtel Oil, Gas and Chemicals, Inc.

as Contractor, dated as of May 24, 2019

Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility by and between Rio Grande LNG, LLC as Owner and Bechtel Oil, Gas and Chemicals, Inc.

as Contractor, dated as of May 24, 2019

10.21 (38)†

Form of Non-Affiliate Director Restricted Stock Award Agreement

Common Stock Purchase Agreement, dated October 24, 2019, by and between NextDecade Corporation and Ninteenth Investment Company

Purchaser Rights Agreement, dated October 28, 2019, by and between NextDecade Corporation and Ninteenth Investment Company

Registration Rights Agreement, dated October 28, 2019, by and between NextDecade Corporation and Ninteenth Investment Company

Lock-Up Agreement, dated October 28, 2019, by and between NextDecade Corporation and Ninteenth Investment Company

Director Compensation Policy

Omnibus Agreement, entered into as of February 13, 2020, between NextDecade LNG, LLC and Spectra Energy Transmission II, LLC.

Precedent Agreement for Firm Natural Gas Transportation Service, made and entered into as of March 2, 2020, by and between Rio Grande LNG Gas Supply LLC and Rio Bravo Pipeline Company, LLC.

Precedent Agreement for Natural Gas Transportation Service, made and entered into as of March 2, 2020, by and between Rio Grande LNG Gas Supply LLC and Valley Crossing Pipeline, LLC.

First Amendment to Lease Agreement, made and entered into as of April 30, 2020, by and between Brownsville Navigation District of Cameron County, Texas and Rio Grande LNG, LLC.

First Amendment to the Fixed Priced Turnkey Agreement for the Engineering, Procurement and Construction of Trains 1 and 2 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of April 22, 2020, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc .

First Amendment to the Fixed Priced Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of April 22, 2020, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

Second Amendment to the Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Trains 1and 2 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of October 5, 2020, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

Second Amendment to the Fixed Priced Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of October 5, 2020, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

Third Amendment to the Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Trains 1and 2 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of March 5, 2021, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

Third Amendment to the Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of March 5, 2021, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

Form of Series C Convertible Preferred Stock Purchase Agreement, dated as of March 17, 2021

Form of Registration Rights Agreement

Subsidiaries of the Company

Consent of Grant Thornton LLP

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Inline 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).

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Inline XBRL Taxonomy Extension Definition Linkbase Document.

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K, filed July 28, 2017.

Incorporated by reference to Exhibit 3.2 of the Company's Current Report on Form 8-K, filed July 28, 2017 .

Incorporated by reference to Exhibit 4.3 of the Company's Registration Statement on Form S-3, filed December 20, 2018 .

Incorporated by reference to Exhibit 3.4 of the Company's Quarterly Report on Form 10-Q, filed November 9, 2018.

Incorporated by reference to Exhibit 3.1 of the Company's Form 8-K, filed March 18, 2021.

Incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K, filed July 15, 2019.

Incorporated by reference to Exhibit 3.2 of the Company's Current Report on Form 8-K, filed July 15, 2019.

Incorporated by reference to Exhibit 3.7 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2019.

Incorporated by reference to Exhibit 3.8 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2019.

Incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K, filed March 4, 2021.

Incorporated by reference to Exhibit 4.1 of the Company's Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 4.3 of the Amendment No.

7 to the Company's Registration Statement on Form S-1, filed March 13, 2015.

Incorporated by reference to Exhibit 4.4 of the Amendment No.

7 to the Company's Registration Statement on Form S-1, filed March 13, 2015.

Incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K, filed August 7, 2018.

Incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K, filed August 24, 2018

Incorporated by reference to Exhibit 4.1 of the Company's Form 8-K, filed March 18, 2021.

Incorporated by reference to Exhibit 4.6 of the Company's Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K, filed September 11, 2017.

Incorporated by reference to Exhibit 10.1 of the Company’s Registration Statement on Form S-8, filed December 15, 2017.

Incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K, filed December 20, 2017.

Incorporated by reference to Exhibit 10.5 of the Company’s Form 8-K, filed August 7, 2018.

Incorporated by reference to Exhibit 10.6 of the Company’s Form 8-K, filed August 7, 2018.

Incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K, filed August 24, 2018.

Incorporated by reference to Exhibit 10.3 of the Company’s Form 8-K, filed August 24, 2018.

Incorporated by reference to Exhibit 10.28 of the Company’s Annual Report on Form 10-K, filed March 6, 2019.

Incorporated by reference to Exhibit 10.29 of the Company’s Annual Report on Form 10-K, filed March 6, 2019.

Incorporated by reference to Exhibit 10.30 of the Company’s Annual Report on Form 10-K, filed March 6, 2019 .

Incorporated by reference to Exhibit 10.31 of the Company’s Annual Report on Form 10-K, filed March 6, 2019.

Incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form 10-Q, filed May 7, 2019.

Incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K, filed May 20, 2019.

Incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K, filed May 20, 2019.

Incorporated by reference to Exhibit 10.3 of the Company’s Form 8-K, filed May 20, 2019.

Incorporated by reference to Exhibit 10.4 of the Company’s Form 8-K, filed May 20, 2019.

Incorporated by reference to Exhibit 10.5 of the Company’s Form 8-K, filed May 20, 2019.

Incorporated by reference to Exhibit 10.6 of the Company’s Form 8-K, filed May 20, 2019.

Incorporated by reference to Exhibit 10.7 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2019.

Incorporated by reference to Exhibit 10.8 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2019.

Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q, filed November 

Incorporated by reference to Exhibit 10.22 of the Company's Annual Report on Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 10.23 of the Company's Annual Report on Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 10.24 of the Company's Annual Report on Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 10.25 of the Company's Annual Report on Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 10.26 of the Company's Annual Report on Form 10-K, filed March 3, 2020.

Incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form 10-Q, filed May 18, 2020.

Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q, filed May 18, 2020

Incorporated by reference to Exhibit 10.3 of the Company's Quarterly Report on Form 10-Q, filed May 18, 2020.

Incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K, filed May 4, 2020.

Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2020.

Incorporated by reference to Exhibit 10.3 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2020.

Incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form 10-Q, filed November 4, 2020.

Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q, filed November 4, 2020.

Incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed March 18, 2021.

Incorporated by reference to Exhibit 10.2 of the Company's Form 8-K, filed March 18, 2021.

Filed herewith.

Furnished herewith.

Indicates management contract or compensatory plan.

Certain portions of this exhibit have been omitted.

Form 10-K Summary

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

NextDecade Corporation

/s/ Matthew K.

Chairman of the Board and Chief Executive Officer

(Principal Executive Officer)

March 25, 2021

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Matthew K.

Chairman of the Board and Chief Executive Officer

March 25, 2021

(Principal Executive Officer)

Chief Financial Officer

March 25, 2021

(Principal Financial Officer)

/s/ Eric Garcia

Vice President and Chief Accounting Officer

March 25, 2021

(Principal Accounting Officer)

/s/ Brian Belke

March 25, 2021

/s/ Frank Chapman

March 25, 2021

Frank Chapman

/s/ Taewon Jun

March 25, 2021

/s/ Avinash Kripalani

March 25, 2021

Avinash Kripalani

/s/ Khalifa Abdulla Al Romaithi

March 25, 2021

Khalifa Abdulla Al Romaithi

/s/ Thanasi Skafidas

March 25, 2021

Thanasi Skafidas

/s/ William Vrattos

March 25, 2021

William Vrattos

/s/ Spencer Wells

March 25, 2021

Spencer Wells

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data