What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2022-03-28 compared with 2021-03-25 · 897 added, 222 removed, 690 unchanged (62% of the section changed)

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NextDecade Corporation and Subsidiaries

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm (PCAOB ID Number 248 )

Consolidated Balance Sheets

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Consolidated Statements of Stockholders’

Equity, Series A and Series B Convertible Preferred Stock

Equity and Convertible Preferred Stock

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Supplemental Information to Consolidated Financial Statements –

Summarized Quarterly Financial Data

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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We have audited the accompanying consolidated balance sheets of NextDecade Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2021 and 2020, 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”).

equity and 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, 2021 and 2020, 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.

Going concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 1 to the financial statements, the Company has incurred operating losses since its inception and management expects operating losses and negative cash flows to continue for the foreseeable future.

These conditions, along with other matters as set forth in Note 1, raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans in regard to these matters are also described in Note 1.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for opinion

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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.

Critical audit matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates 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 matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

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.

As described further in Note 9 to the consolidated financial statements, the Company had $4 million of common stock warrant liabilities as of December 31, 2021.

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.

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

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

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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

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$ 22,608  

Investment securities

62,207  

Prepaid expenses and other current assets

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$ 222,105  

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

$ 201,668  

Liabilities, 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

Other non-current liabilities

23,000  

Non-current operating lease liabilities

Other non-current liabilities  

22,916  

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

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

73,713 shares and 65,507 shares at December 31, 2021 and 2020, respectively

63,791  

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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

70,433 shares and 62,612 shares at December 31, 2021 and 2020, respectively

64,602  

56,781  

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

42,490 shares and no shares at December 31, 2021 and 2020, respectively

40,007  

Stockholders’

Common stock, $0.0001 par value Authorized:

480 .0 million shares at December 31, 2020 and December 31, 2019, Issued and outstanding:

117.8 million shares and 117.3 million shares at December 31, 2020 and December 31, 2019, respectively

480.0 million shares at December 31, 2021 and 2020, Issued and outstanding:

120.8 million shares and 117.8 million shares at December 31, 2021 and 2020, respectively

Treasury stock:

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

346,126 shares and 249,742 shares at December 31, 2021 and 2020, respectively, at cost

( 1,315 )  

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, 2020 and December 31, 2019

0.5 million, after designation of the Convertible Preferred Stock, Issued and outstanding:

none at December 31, 2021 and 2020

Additional paid-in-capital

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60,432  

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

Total liabilities, Convertible Preferred Stock and stockholders’

$ 222,105  

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General and administrative expenses

Invitation to Bid Contract Costs

16,803  

20,213  

Development expense

Land option and lease expenses

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Total operating expenses

19,507  

22,012  

Total operating loss

( 19,507 )  

Other income (expense)

Gain (loss) on Common Stock Warrant liabilities

(Loss) gain on Common Stock Warrant liabilities

( 2,533 )  

Loss on redemption of investment securities

Interest income, net

Total other income

Total other (expense) income

( 2,532 )  

Net loss attributable to NextDecade Corporation

( 22,039 )  

Preferred stock dividends

( 18,294 )  

Deemed dividends on Series A Convertible Preferred Stock

( 63 )  

Net loss attributable to common stockholders

$ ( 40,396 )  

Net loss per common share - basic and diluted

$ ( 0.34 )  

Weighted average shares outstanding - basic and diluted

119,201  

117,524  

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

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Consolidated Statements of Stockholders’

Equity, Series A and Series B Convertible Preferred Stock

Equity and Convertible Preferred Stock

(in thousands)

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Preferred Stock

Balance at January 1, 2020

Adoption of ASC Topic 842

Adoption of ASU 2018-07

117,329  

$ ( 685 )  

$ 224,091  

$ ( 133,701 )  

$ 89,717  

$ 48,084  

$ 49,814  

Share-based compensation

( 155 )  

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

( 112 )  

( 346 )  

Preferred stock dividends

( 14,327 )  

Deemed dividends - accretion of beneficial conversion feature

( 128 )  

( 14,329 )  

Balance at December 31, 2020

117,829  

$ ( 1,031 )  

$ 209,481  

$ ( 148,030 )  

$ 60,432  

$ 55,522  

$ 56,781  

Share-based compensation

( 4,541 )  

Restricted stock vesting

Shares repurchased related to share-based compensation

( 97 )  

( 284 )  

Issuance of common stock, net

Stock dividend

Exercise of common stock warrants

Issuance of Series C Convertible Preferred Stock

37,807  

Preferred stock dividends

( 18,294 )  

Deemed dividends - accretion of beneficial conversion feature

( 63 )  

( 22,039 )  

Balance at December 31, 2021

120,838  

$ ( 1,315 )  

$ 191,264  

$ ( 170,069 )  

$ 19,892  

$ 63,791  

$ 64,602  

$ 40,007  

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

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Net loss attributable to NextDecade Corporation

$ ( 22,039 )  

Adjustment to reconcile net loss to net cash used in operating activities

Share-based compensation expense

(Gain) loss on Common Stock Warrant liabilities

Gain on investment securities

Realized loss (gain) on investment securities

Share-based compensation expense (forfeiture)

( 4,313 )  

Loss (gain) on Common Stock Warrant liabilities

Realized loss on investment securities

Amortization of right-of-use assets

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Prepaid expenses

( 186 )  

Accounts payable

( 26 )  

Operating lease liabilities

( 548 )  

Accrued expenses and other liabilities

Net cash used in operating activities

( 17,960 )  

Investing activities:

Acquisition of property, plant and equipment

( 12,105 )  

Acquisition of other non-current assets

( 6,429 )  

Proceeds from sale of investment securities

61,972  

Purchase of investment securities

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities

( 18,534 )  

18,521  

Financing activities:

Proceeds from sale of Rio Bravo Pipeline Company, LLC

Proceeds from equity issuance

Preferred stock dividends

15,000  

Proceeds from sale of Series C Convertible Preferred Stock

39,500  

Proceeds from sale of common stock

Equity issuance costs

( 268 )  

Preferred stock dividends

( 67 )  

Shares repurchased related to share-based compensation

( 284 )  

Net cash provided by financing activities

39,438  

14,604  

Net increase in cash and cash equivalents

1 unchanged sentence

beginning of period

22,608  

15,736  

Cash and cash equivalents –

end of period

$ 25,552  

$ 22,608  

Non-cash investing activities:

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Pipeline assets obtained in exchange for other non-current liabilities

Common stock issued in lieu of cash

Non-cash financing activities:

Paid-in-kind dividends on Series A Convertible Preferred Stock

Paid-in-kind dividends on Convertible Preferred Stock

18,227  

14,277  

Accretion of deemed dividends on Series A Convertible Preferred Stock

Accrued liabilities for equity issuance costs

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

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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”). 

NextDecade Corporation engages in development activities related to the liquefaction and sale of liquefied natural gas (“LNG”) and the capture and storage of CO 2  emissions.

We have focused our development activities on the Rio Grande LNG terminal facility at the Port of Brownsville in southern Texas (the “Terminal”), a carbon capture and storage project at the Terminal (the “Terminal CCS project”) and other carbon capture and storage projects (“CCS projects”) with third -party industrial source facilities. 

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.

The Company has incurred operating losses since its inception and management expects operating losses and negative cash flows to continue for the foreseeable future and, as a result, the Company will require additional capital to fund its operations and execute its business plan.

As of December 31, 2021, the Company had $ 25.6 million in cash and cash equivalents, which are not sufficient to fund the Company's planned operations through one year after the date the consolidated financial statements are issued.

Accordingly, there is substantial doubt about the Company's ability to continue as a going concern.

The analysis used to determine the Company's ability to continue as a going concern does not include cash sources outside of the Company's direct control that management expects to be available within the next twelve months.

The Company plans to alleviate the going concern issue by obtaining sufficient funding through additional equity, equity-based or debt instruments or any other means and managing certain operating and overhead costs.

The Company may not be able to obtain sufficient funding through additional equity or debt instruments or any other means, and if it is able to do so, they may not be on satisfactory terms.

The Company's ability to raise additional capital in the equity and debt markets, should the Company choose to do so, is dependent on a number of factors, including, but not limited to, the market demand for the Company's equity or debt securities, which itself is subject to a number of business risks and uncertainties, as well as the uncertainty that the Company would be able to raise such additional capital at a price or on terms that are favorable to the Company.

In the event the Company is unable to obtain sufficient additional funding, there can be no assurance that it will be able to continue as a going concern.

These consolidated financial statements have been prepared on a going concern basis and do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary in the event the Company can no longer continue as a going concern.

Note 2 —

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Financial instruments that potentially subject us to a concentration of credit risk consist principally of cash and cash equivalents.

We maintain cash balances with a single financial institution, which may at times be in excess of federally insured levels.

We maintain cash and cash equivalent balances with a single financial institution, which may at times be in excess of federally insured levels.

We have not incurred losses related to these cash and cash equivalent balances to date.

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We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Investment Securities

We define investment securities as investments in marketable securities that can be readily converted to cash.

We determine the appropriate classification of investment securities at the time of purchase and reevaluate such classification at each balance sheet date.

Investment securities are initially recorded at cost and remeasured to fair value, with changes presented in other income in our Consolidated Statements of Operations.

Property, Plant and Equipment

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Property, plant and equipment is carried at historical cost and depreciated using the straight-line method over their estimated useful lives.

Leasehold improvements are depreciated over the lesser of the economic life of the leasehold improvement or the term of the lease, without regard to extension/renewal rights.

Leasehold improvements are depreciated over the lesser of the economic life of the leasehold improvement or the term of the lease, without regard to extension or renewal rights.

Management tests property, plant and equipment for impairment whenever events or changes in circumstances have indicated that the carrying amount of property, plant and equipment might not be recoverable.

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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 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.

The Company utilizes its incremental borrowing rate in determining the present value of the future lease payments.

The incremental borrowing rate is derived from information available at the lease commencement date and represents the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term and amount equal to the lease payments in a similar economic environment.

The right-of-use assets and lease liabilities may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

The Company has lease arrangements that include both lease and non-lease components.

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

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”

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.

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 must or may require settlement by issuing a variable number of shares.

If warrants do not meet liability classification under ASC 480, the Company assesses the requirements under ASC 815 - 40, which states that contracts that require or may require the issuer to settle the contract for cash or a variable number of shares are liabilities recorded at fair value, irrespective of the likelihood of the transaction occurring that triggers the net cash settlement feature.

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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 10  

Recurring fair-value measurements are performed for Common Stock Warrant liabilities as disclosed in Note 9  

Preferred Stock and Common Stock Warrants .

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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.

The Company's chief operating decision maker allocates resources and assesses financial performance on a consolidated basis.

As such, for purposes of financial reporting under GAAP during the years ended December 31, 2021 and 2020, the Company operated as a single operating segment.

Smaller Reporting Company

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Total prepaid expenses and other current assets

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 4  —

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(“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.

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 positive FID, 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”).

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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, 2021.

Note 6 —

Note 5  —

Property, Plant and Equipment

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Depreciation expense for the years ended 

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

December 31, 2021 and 2020 was $ 184 thousand and $ 196  thousand, respectively.

Note 6  —

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.

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 December 31, 2022.

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.

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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.

The Company elected not to apply Topic 842 to arrangements with original lease terms of 12 months or less.

At lease commencement date, the Company estimated the lease liability and the right-of-use assets at present value, at inception, of $ 2.3 million.

On January 1, 2019, upon adoption of Topic 842, the Company recorded right-of-use assets of $ 1.6 million, lease liabilities of $ 1.9 million, eliminated deferred rent of $ 0.1 million and recorded a cumulative-effect adjustment of $ 0.2 million.

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.

The Company utilizes its incremental borrowing rate in determining the present value of the future lease payments.

The right-of-use assets and lease liabilities may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

The Company has lease arrangements that include both lease and non-lease components.

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

On April 28, 2021, Rio Grande delivered a notice to BND electing to extend the Effective Date of the Rio Grande Site Lease Amendment to May 6, 2022.

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

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Total operating lease right-of-use assets, net

$ 1,054  

Operating lease liabilities are as follows (in thousands):

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$ 1,603  

$ 2,039  

Maturity of operating lease liabilities as of 

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$ 1,004  

$ 1,844  

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

Adoption of Topic 842

In exchange for new operating lease liabilities during the period

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Enterprise resource planning system, net

Rio Grande Site Lease initial direct costs  

Total other non-current assets, net  

Rio Grande Site Lease initial direct costs

13,314  

Total other non-current assets, net

$ 21,312  

$ 16,299  

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

4 unchanged sentences

Employee compensation expense

Terminal and Pipeline asset costs

$ 4,358  

Terminal asset costs

Accrued legal services

1 unchanged sentence

Total accrued liabilities and other current liabilities

$ 5,791  

$ 1,032  

9  —

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Preferred Stock

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.

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.

As of December 31, 2019, the Company had outstanding 58,197 shares of Series A Convertible Preferred Stock, par value $ 0.0001 per share (the “Series A Preferred Stock”) and 55,645 shares of Series B Convertible Preferred Stock, par value $ 0.0001 per share (the “Series B Preferred Stock”).

March 2021, 

the Company sold an aggregate of 

24,500  shares of Series C Convertible Preferred Stock, par value $ 0.0001  per share (the “Series C Preferred Stock”

and, together with the Series A Preferred Stock and the Series B Preferred Stock, the “Convertible Preferred Stock”), at $ 1,000  per share for an aggregate purchase price of $ 24.5  million and issued an additional 

490  shares of Series C Preferred Stock in aggregate as origination fees to the purchasers of the Series C Preferred Stock.

April 2021, 

the Company sold 

10,000  shares of Series C Preferred Stock, at $ 1,000  per share for a purchase price of $ 10  million and issued an additional 

200  shares of Series C Preferred Stock as an origination fee to the purchaser of the Series C Preferred Stock.

July 2021, 

the Company sold 

5,000  shares of Series C Preferred Stock, at $ 1,000  per share for a purchase price of $ 5  million and issued an additional 

100  shares of Series C Preferred Stock as an origination fee to the purchaser of the Series C Preferred Stock.

Warrants, exercisable for Company common stock, were issued together with the shares of Series C Preferred Stock (“Series C Warrants”).

Net proceeds from the sales of Series C Preferred Stock during 

2021 were allocated on a fair value basis to the Series C Warrants and on a relative fair value basis to the Series C Preferred Stock. 

The allocation of net cash proceeds from the sales of Series C Preferred Stock during 2021 is as follows (in thousands):

Year Ended December 31, 2021

Gross proceeds

$ 39,500  

Equity issuance costs

( 62 )  

Net proceeds - Initial Fair Value Allocation

$ 39,438  

$ 1,631  

$ 37,807  

Per balance sheet upon issuance

$ 1,631  

$ 37,807  

December 31, 2021 ,  shares of Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock were convertible into shares of Company common stock at a weighted average conversion price of $ 6.53  per share, $ 6.57  per share and $ 3.28  per share, respectively (with respect to each series, the “Conversion Price”).

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 the applicable 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 Series B 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.

The shares of Convertible Preferred Stock bear dividends at a rate of 12 % per annum, which are cumulative and accrue daily from the date of issuance on the $ 1,000 stated value.

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

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.

During the years ended December 31, 2021 and 2020  the Company paid-in-kind $ 18.2  million and $ 14.3  million of dividends, respectively, to holders of the Convertible Preferred Stock.

On January 13, 2022, the Company declared dividends to holders of the Convertible Preferred Stock as of the close of business on December 15, 2021.

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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.

Shares of 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, 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.

equity in the Company's 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, the Company re-evaluates whether the Convertible Preferred Stock continue to qualify for equity classification.

Common Stock Warrants

The Series A Warrants issued to the Series A 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 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.

Warrants, exercisable for Company common stock, were issued together with the shares of Convertible Preferred Stock (collectively, “Common Stock Warrants”). 

As of December 31, 2021 and 2020, the outstanding Common Stock Warrants represented the right to acquire in the aggregate a number of shares of Company common stock equal to approximately 86 basis points ( 0.86 %) and 142 basis points ( 1.42 %), respectively, of all outstanding shares of Company common stock, measured on a fully diluted basis, on the applicable exercise date with an exercise price of $ 0.01 per share.

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

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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 gain of $ 7.9 million and a loss of $ 2.7 million as of December 31, 2020 and 2019 , respectively.

The Company revalues the Common Stock Warrants at each balance sheet date and recognized a loss of $ 2.5 million and a gain of $ 7.9  million as of December 31, 2021 and 2020 , 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, 2020 are as follows:

December 31, 2021  and 2020 are as follows:

$ 2.85  

$ 2.09  

Exercise price

$ 0.01  

Risk-free rate

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

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.

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 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.

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.

62.6 %  

Note 10  —

Stockholders' Equity

Common Stock Purchase Agreement

October 24, 2019, 

the Company entered into a Common Stock Purchase Agreement with Ninteenth Investment Company LLC, an affiliate of Mubadala Investment Company PJSC (the “Purchaser”). 

During the year ended 

December 31, 2021 ,  the Company issued an additional 797,450 shares of Company common stock to the Purchaser pursuant to the terms of the Common Stock Purchase Agreement.

At-the-Market Program

August 2021, 

the Company entered into an at-the-market sales agreement with Virtu Americas LLC (“Virtu”) pursuant to which the Company 

sell shares of Company common stock from time to time through Virtu acting as sales agent, for aggregate proceeds of up to $ 50  million. 

During the year ended 

December 31, 2021 ,  the Company sold approximately 

0.2 million shares for proceeds, net of placement fees, of approximately $ 0.6 million.

Common Stock Warrants

During the year ended 

December 31, 2021 ,  Common Stock Warrants were exercised by certain holders of Series A Preferred Stock and Series B Preferred Stock. 

In connection with the exercises of Common Stock Warrants, the Company issued an aggregate of approximately 1.5 million shares of Company common stock.

11  —

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Weighted average common shares outstanding:

119,201  

117,524  

Dilutive unvested stock, convertible preferred stock, Common Stock Warrants and IPO Warrants

119,201  

117,524  

Basic and diluted net loss per share attributable to common stockholders

$ ( 0.34 )  

Potentially dilutive securities that were not included in the diluted net loss per share computations because their effect would have been anti-dilutive were as follows (in thousands):

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31,609  

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  

Does not include 8.3 million shares and 2.1 million shares of unvested restricted stock and restricted stock units for the years ended 

December 31, 2021 and 2020 because the performance conditions had not yet been satisfied as of 

December 31, 2021 and 2020 , respectively.

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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 12 —

12  —

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.

We have granted shares of Company common stock, restricted Company common stock and restricted stock units to employees, consultants and non-employee directors under our 2017 Omnibus Incentive Plan.

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

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Capitalized share-based compensation

( 186 )  

Total share-based compensation expense

$ ( 4,313 )  

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.

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

In January 2018, the Compensation Committee of the Board of Directors approved, and certain employees party to such arrangements accepted, an amendment to such arrangements 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 is included in share-based compensation liability in our Consolidated Balance Sheets at each of 

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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.

December 31, 2021 relating to equity-classified awards were $ 25.1 million, which is expected to be recognized over a weighted average period of 3  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.

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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 

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

December 31, 2021 and changes during the year ended 

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$ 5.88  

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

December 31, 2021 and changes during the year ended 

December 31, 2021 (in thousands, except for per share information):

Weighted Average Grant Date Fair Value Per Share

Non-vested at January 1, 2021

( 50 )  

Non-vested at December 31, 2021

$ 3.31  

13  —

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$ 20,698  

Employee compensation

Share-based compensation expense

Property, plant and equipment

Common stock warrant liabilities  

Operating lease liabilities  

Common stock warrant liabilities

Operating lease liabilities

valuation allowance

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Deferred tax liabilities

Common stock warrant liabilities  

( 1,129 )  

Operating lease Right-of-use assets  

Common stock warrant liabilities

Operating lease Right-of-use assets

( 2,920 )  

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Commitments and Contingencies

Other Commitments

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

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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.

Other Commitments

On April 28, 2021, Rio Grande delivered a notice to BND electing to extend the Effective Date of the Rio Grande Site Lease Amendment to May 6, 2022.

In the fourth quarter of 2021, Rio Grande entered into an amended agreement for wetland mitigation measures. 

In connection with the amended agreement, Rio Grande is committed to spend approximately $ 0.5 million in 2022.

Legal Proceedings

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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.

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January 1, 2022

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

We adopted this standard using the modified retrospective approach, which did not have an effect 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.

Series C Preferred Stock

On March 3, 2022, pursuant to the Series C Convertible Preferred Stock Agreement, dated as of February 28, 2022, by and between the Company and TEP Next Decade, LLC (“TEP Next Decade”), the Company issued to TEP Next Decade (i) 

5,000 shares of Series C Preferred Stock at $ 1,000 per share for a purchase price of $ 5.0 million, (ii) an additional 100 shares of Series C Preferred Stock as an origination fee and (iii) warrants representing the right to acquire in the aggregate a number of shares of the Company's common stock equal to approximately 7.1 basis points ( 0.071 %) of all outstanding shares of common stock, measured on a fully diluted basis, on the exercise date for an exercise price of $ 0.01 per share.

On March 14, 2022, pursuant to the Series C Convertible Preferred Stock Agreement, dated as of March 10, 2022, by and between the Company and Avenue Energy Opportunities Fund II, L.P.

(“Avenue”), the Company issued to Avenue (i) 

5,500 shares of Series C Preferred Stock at $ 1,000 per share for a purchase price of $ 5.5 million, (ii) an additional 110 shares of Series C Preferred Stock as an origination fee and (iii) warrants representing the right to acquire in the aggregate a number of shares of the Company's common stock equal to approximately 7.81  basis points ( 0.0781 %) of all outstanding shares of common stock, measured on a fully diluted basis, on the exercise date for an exercise price of $ 0.01 per share.

We have evaluated subsequent events through March 28, 2022, 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.

NextDecade Corporation and Subsidiaries

Supplemental Information to Consolidated Financial Statements

Summarized Quarterly Financial Data

Summarized Quarterly Financial Data –

(in thousands, except per share amounts)

Year ended December 31, 2020:

Total operating loss

Net loss attributable to common stockholders

Basic and diluted loss per share (1)

Year ended December 31, 2019:

Total operating loss

Net loss attributable to common stockholders

Basic and diluted loss per share (1)

The sum of the quarterly basic and diluted loss per share may not equal the full year amount as the computation of the weighted average common shares outstanding for basic and diluted shares outstanding for each quarter and the full year are performed independently.

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

Changes in and Disagreements with Accountants

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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.

At the Company’s 2021 Annual Meeting of Stockholders, the Company’s stockholders voted on, among other matters, a proposal regarding the frequency of holding advisory votes on executive compensation.

As previously reported in the Company’s Form 8-K filed on June 16, 2021, and consistent with the recommendation of the Company’s Board of Directors, the stockholders approved, on an advisory basis, an annual advisory vote on compensation for the Company’s named executive officers.

In connection with the board recommendation and the stockholder vote results, the Company will hold an advisory vote on executive compensation on an annual basis until the next stockholder advisory vote on this matter.

D IRECTORS , E XECUTIVE O FFICERS AND C ORPORATE G OVERNANCE

Corporate Governance

Role of the Board

The Board oversees the Chief Executive Officer and other senior management in the management of the Company’s business and affairs.

The Company’s key governance documents, including the Company’s Second Amended and Restated Corporate Governance Guidelines (the “Corporate Governance Guidelines”), may be found on the “Corporate Governance”

page under the “Investors”

section of our corporate website.

Our governance structure is designed to foster principled actions, effective decision-making, and appropriate monitoring of compliance and performance.

Board Leadership Structure

The Board does not have a policy requiring the combination or separation of leadership positions and the Company’s governing documents do not mandate a particular structure.

This provides the Board with the flexibility to select its leadership structure, from time to time, based on the criteria that it deems in the best interests of the Company and its stockholders.

The Board recognizes that the leadership structure and the combination or separation of the Chief Executive Officer and the Chairman positions are driven by the Company’s needs at any point in time.

Currently, the Chief Executive Officer and Chairman positions are held by Matthew Schatzman.

The Company also has a Lead Independent Director, William Vrattos, who was appointed by the Board as Lead Independent Director in April 2020.

The Lead Independent Director has broad responsibility and authority, including to:

preside at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent directors;

call meetings of independent directors;

serve as the principal liaison between the Chairman and the independent directors;

approve all information sent to the Board, including the quality, quantity, appropriateness and timeliness of such information;

retain outside advisors and consultants who report directly to the Board on Board-wide issues;

on an annual basis, review his responsibility and authority and recommend to the Board for approval any modifications or changes;

perform such other duties as the Board may delegate from time to time.

The Board has determined that its current structure, with combined Chief Executive Officer and Chairman roles and a Lead Independent Director, is in the best interests of the Company and its stockholders at this time.

A number of factors support a combined Chief Executive Officer and Chairman role, counterbalanced by a Lead Independent Director, including, among others:

the Chief Executive Officer has extensive knowledge of all aspects of the Company and its business and risks, its industry and its customers;

the Chief Executive Officer is intimately involved in the day-to-day operations of the Company and is best positioned to elevate the most critical business issues for consideration by the Board;

the Board believes the Chief Executive Officer serving in both capacities allows him to more effectively execute the Company’s strategic initiatives and business plans and confront its challenges;

a combined Chief Executive Officer and Chairman role provides the Company with decisive and effective leadership with clearer accountability to the Company’s stockholders;

the combined role is both counterbalanced and enhanced by the effective oversight and independence of the Board and the leadership provided by the Lead Independent Director and committee chairs;

the Board believes that the appointment of a strong Lead Independent Director and the use of regular executive sessions of the non-management directors, along with all directors being independent except for the Chief Executive Officer, allow it to maintain effective oversight of management;

in the Board’s view, splitting the Chief Executive Officer and Chairman roles could potentially make our management and governance processes less effective through undesirable duplication of work and possibly lead to a blurring of clear lines of accountability and responsibility.

The Board periodically reviews the leadership structure to determine whether it continues to best serve the Company and its stockholders.

Board Role in Risk Oversight

Risk is inherent in any business, and the Company’s management is responsible for the day-to-day management of risks that the Company faces.

The Board, on the other hand, has responsibility for the oversight of risk management.

In its risk oversight role, the Board has the responsibility to evaluate the risk management process to ensure its adequacy and that it is implemented properly by management.

The Board believes that full and open communication between management and the Board is essential for effective risk management and oversight.

The Board meets regularly with senior management, including the executive officers, to discuss strategy and risks facing the Company.

Senior management attends the quarterly meetings of the Board, as well as certain committee meetings, in order to address any questions or concerns raised by directors on risk management and any other matters.

Each quarter, or more frequently if the business requires, the Board receives presentations from senior management on business operations, financial results and strategic issues.

The Board is also assisted by committees in fulfilling its oversight responsibilities in certain areas of risk, as described further under the section below titled “Committees of the Board.”  All of the committees report back to the full Board as to the committees’

activities and matters discussed and reviewed at the committees’

Identification of Directors

Currently, the board of directors (the “Board”) of the Company consists of nine members. The Certificate of Incorporation and the Bylaws provide that the Board be classified into three classes.

These classes are designated as Class A directors, Class B directors and Class C directors, with members of each class holding office for staggered three-year terms.

Newly created directorships or vacancies on the Board resulting from death, resignation, disqualification, removal or other causes may be filled by the affirmative vote of a majority of the remaining directors then in office, even if less than a quorum of the Board is present, or by a sole remaining director.

Each such director so chosen shall hold office until the Company’s next annual meeting of stockholders or until such director’s successor is duly elected and qualified or until such director’s earlier death, resignation or removal in accordance with the Bylaws. 

There are currently three Class A directors, three Class B directors and three Class C directors. Each of the Class A directors has a term that expires at the 2024 Annual Meeting of Stockholders or until such date that his successor is duly elected and qualified or until his earlier death, resignation or removal in accordance with the Bylaws. 

Each of the Class B directors has a term that expires at the 2022 Annual Meeting of Stockholders or until such date that his successor is duly elected and qualified or until his earlier death, resignation or removal in accordance with the Bylaws.

Each of the Class C directors, has a term that expires at the 2023 Annual Meeting of Stockholders or until such date that his successor is duly elected and qualified or until his earlier death, resignation or removal in accordance with the Bylaws.

The name, age as of March 22, 2022, principal occupation, and other information highlighting the particular experience, qualifications, attributes and skills concerning of each director are set forth below.

Class A Directors

Schatzman , 56, is the Company’s Chief Executive Officer and has served in such position since February 2018.

Schatzman has served as a member of the Board since September 2017 and, in June 2019, Mr.

Schatzman was appointed Chairman of the Board.

From September 2017 until his appointment as Chairman of the Board, Mr.

Schatzman served as the Company’s President.

Prior to joining the Company, Mr.

Schatzman served as President at MKS Energy, LLC, an advisory and consulting firm focused on LNG, natural gas and crude oil markets, logistics and risk management from March 2017 until September 2017.

He was previously Executive Vice President, Global Energy Marketing and Shipping at BG Group, plc (“BG Group”), a British multinational oil and gas company, from January 2012 until May 2014 and served as Senior Vice President, Energy Marketing from March 2007 until December 2011.

Prior to that, he served in various roles at Dynegy Inc.

(“Dynegy”), including President and Chief Executive Officer of Dynegy’s wholesale business.

Schatzman is a member of the National Petroleum Council.

Schatzman holds a Bachelor of Arts in Political Science from Yale University.

The Board believes Mr.

Schatzman’s marketing, logistics, risk management and operational leadership experience of over 32 years with companies in the LNG, natural gas, oil and power generation industries, including BG Group and Dynegy, make him well-qualified to serve as the Company’s Chairman and Chief Executive Officer.

Avinash Kripalani,  38, has served as a Company director since July 2017 and was originally appointed to the Board pursuant to the terms of the Harmony Merger Agreement.

Kripalani served as a member of the board of managers of NextDecade LLC from April 2016 until July 2017.

Kripalani is a Partner at Bardin Hill Investment Partners LP (“Bardin Hill”), where he has worked since April 2008.

Prior to Bardin Hill, he was a Consultant at IBM.

Kripalani earned a Bachelor of Science in Economics and a Bachelor of Science and a Master of Science in Systems and Information Engineering from the University of Virginia.

The Board believes Mr.

Kripalani’s experience as a private equity principal and in other senior executive leadership roles and relevant experience in private financing and strategic planning, as well as extensive industry knowledge, provides him with the qualifications and skills necessary to serve as a Company director.

William Vrattos , 52, has served as a Company director since July 2017, as Lead Independent Director since April 2020, and was originally appointed to the Board pursuant to the terms of the Harmony Merger Agreement.

Vrattos served as a member of the board of managers of NextDecade from June 2015 until July 2017.

Vrattos joined York Capital Management, L.P.

(“York”) in January 2002 and is the Co-Chief Investment Officer and a Managing Partner of York.

Vrattos is a Co-Portfolio Manager of the York Credit Opportunities, York Distressed Asset, York Global Credit Income, York Insurance Dedicated, and York Tactical Energy funds and a member of York’s executive committee.

Prior to joining York, he worked at Georgica Advisors LLC as a Portfolio Manager specializing in media and communications equities and distressed securities and at Morgan Stanley & Co., Inc.

as an investment banker.

Vrattos is currently a member of the board of directors or advisory board, as applicable and in his capacity as a York employee, of (i) all entities related to Entropy Investments, (ii) all entities incorporated pursuant to York’s partnerships with Costamare, Inc., and (iii) India 2021.

In addition, Mr.

Vrattos is the Chairman of the Board of Trustees of the Museum of the City of New York and a member of the Board of Trustees of Groton School, and the Investment Committee of the Dartmouth College Endowment.

Vrattos received a Bachelor of Arts in English from Dartmouth College and a Master of Business Administration from Harvard Business School.

Class B Directors

Khalifa Abdulla Al Romaithi , 43, has served as a Company director since December 2019 and was originally appointed to the Board pursuant to the terms of that certain Purchaser Rights Agreement, dated as of October 28, 2019 (the “NIC Purchaser Rights Agreement”), by and between the Company and Ninteenth Investment Company LLC (“Ninteenth”).

Since May 2017, Mr.

Al Romaithi has served as the Executive Director, Midstream, in the Petroleum and Petrochemicals business at Mubadala Investment Company (“Mubadala”) where he is responsible for pursuing attractive investment opportunities across the entire oil and gas infrastructure value chain with a primary focus on natural gas and crude gathering, treating, compression, processing and storage, pipeline, natural gas liquefaction and regasification.

Prior to Mubadala, from June 2003 until August 2015, Mr.

Al Romaithi held various senior managerial positions, including Director of Downstream Investments and Head of Portfolio Management, at the International Petroleum Investment Company.

Al Romaithi serves on the board of directors of several companies including Borealis AG, Sumed, Gulf Energy Maritime PJSC, Arabtec Holding Co.

PJSC, Depa United Group, and Abu Dhabi National Takaful Co.

Al Romaithi received a Bachelor of Business Administration with a major in Finance from the University of Portland.

The Board believes Mr.

Al Romaithi’s extensive energy industry experience and experience overseeing investments in such industry provide him with the qualifications and skills to serve as a Company director.

Sir Frank Chapman , 68, has served as a Company director since November 2019.

Since November 2011, Sir Frank has served on the board of directors of Rolls-Royce Holdings, plc.

Sir Frank served as the Chairman of Golar LNG Ltd from September 2014 to September 2015.

Sir Frank has spent over 40 years in the oil and gas industry, beginning his career with BP plc in 1974 before moving to Royal Dutch Shell plc in 1978 where he worked for 18 years.

Sir Frank then moved to British Gas as Managing Director Exploration and Production in 1996.

Sir Frank was appointed Chief Executive of BG Group in 2000 and was a member of its board of directors for over 16 years.

Sir Frank retired from BG Group in June 2013.

He was named in the 2011 Queen’s Birthday Honours List and knighted for services to the oil and gas industry.

Sir Frank graduated with first class honors in Mechanical Engineering from Queen Mary College, London University.

The Board believes Sir Frank’s extensive leadership experience of over 40 years in the oil and gas industry make him well-qualified to serve as a Company director.

Seokwon Ha , 45, has served as a Company director since February 2022 and and was appointed to the Board pursuant to the terms of that certain Purchaser Rights Agreement, dated as of August 3, 2018 (the “2018 HGC Series A Purchaser Rights Agreement”), by and between the Company and HGC NEXT INV LLC (“HGC”). 

Ha is the President of Hanwha Impact Partners, a holding company managing investment portfolio in U.S.

covering a wide range of sectors such as clean energy, data science, and life science and developing new business for sustainable growth.

From April 2017 until December 2021, Mr.

Ha served as a Senior Vice President leading New Business Development Team of Hanwha Impact in Seoul, Republic of Korea with an expertise related to cross border M&A. 

Hanwha Group is a business conglomerate with affiliates operating in various industries including chemicals, energy, petrochemicals, solar, aerospace, and defense as well as finance, asset management, and hotel and resorts.

Prior to joining Hanwha, Mr.

Ha held roles in several investment banks and financial advisory firms, including NH Investment & Securities and Ernst & Young.  Mr.

Ha received a Bachelor of Business Administration from Seoul National University and a Master of Business Administration from the Carnegie Mellon University Tepper School of Business.

The Board believes Mr.

Ha's leadership capabilities, banking and financial advisory experience and general business acumen as well as his broad understanding of business globally provide Mr.

Ha with the qualifications and skills to serve as a Company director.

Class C Directors

Brian Belke , 38, has served as a Company director since July 2017 and was originally appointed to the Board pursuant to the terms of that certain Agreement and Plan of Merger, dated as of April 17, 2017 (the “Harmony Merger Agreement”), by and among Harmony Merger Corp., Harmony Merger Sub, LLC, York Credit Opportunities Investments Master Fund, L.P., York Multi-Strategy Master Fund, L.P., York Select Master Fund, L.P., York Global Finance 43, LLC, Valinor Management, L.P., Valinor Capital Partners SPV XXI, LLC, Halcyon Capital Management LP, Halcyon Energy, Power, and Infrastructure Capital Fund Offshore LLC, Halcyon Energy, Power, and Infrastructure Capital Holdings Offshore LLC, Halcyon Energy, Power, and Infrastructure Capital Fund LP, and NextDecade LNG, LLC (formerly NextDecade, LLC (“NextDecade”).

Belke served as member of the board of managers of NextDecade from June 2015 until July 2017.

Since September 2020, Mr.

Belke has served as a Managing Partner of Heights Point Management, LP.

From June 2010 until June 2020, Mr.

Belke was a Partner at Valinor Management L.P.

(“Valinor”).

Prior to Valinor, Mr.

Belke was an Equity Research Associate at Fidelity Investments.

He is a Chartered Financial Analyst and is a member of the CFA Institute and the New York Society of Securities Analysts.

Belke earned a Bachelor of Science in Management with concentrations in Finance and Accounting, summa cum laude, from Boston College, and a Master of Business Administration from Harvard Business School, where he graduated with High Distinction as a Baker Scholar.

The Board believes Mr.

Belke’s experience as a partner of an investment firm and in other senior executive leadership roles as well as his extensive industry experience and experience overseeing investments in the LNG sector provide him with the qualifications and skills to serve as a Company director.

Spencer Wells , 51, has served as a Company director since July 2017 and was originally appointed to the Board pursuant to the terms of the Harmony Merger Agreement.

Wells has over 20 years of experience as a portfolio manager and financial analyst.

Wells co-founded Drivetrain Advisors, LLC, a firm providing fiduciary services to the alternate investment community (“Drivetrain”), in December 2013, where he currently serves as a Partner.

Prior to co-founding Drivetrain, Mr.

Wells was employed by TPG Special Situations Partners (“TPG”) from 2010 to 2013, where he first served as Partner from September 2010 to January 2012, and then as a Senior Advisor from January 2012 to July 2013.

Prior to TPG, Mr.

Wells served as a Partner/Portfolio Manager for Silverpoint Capital, as a Director at the Union Bank of Switzerland and as a Vice President of Deutsche Bank AG.

Wells has served as a member of the boards of directors of (i) Advanced Emissions Solutions, Inc.

since July 2014, (ii) Town Sports International Holdings, Inc.

since March 2015, (iii) Vantage Drilling International since February 2016, (iv) Samson Resources II, LLC since February 2018, (v) Treehouse Real Estate Investment Trust, Inc.

since January 2019, and (vi) Parker Drilling Company, Inc.

since March 2019.

Wells served as a member of the boards of directors of (i) each of CertusHoldings, Inc.

and CertusBank, N.A.

from August 2014 to April 2016, (ii) Global Geophysical Services, LLC from February 2015 to October 2016, (iii) Syncora Holdings Ltd.

from August 2015 to December 2016, (iv) Affinion Group, Inc.

from November 2015 to July 2017, (v) Lily Robotics.

from January 2017 to September 2017, (vi) Roust Corporation from February 2017 to December 2017, (vii) Jones Energy, Inc.

from November 2018 until May 2019, and (viii) Vanguard Natural Resources from February 2019 to July 2019.

Wells received a Bachelor of Arts in Psychology from Wesleyan University and a Master of Business Administration, with honors, from Columbia Business School.

Edward  

Andrew  

Scoggins , 

, 42, has served as a Company director since April 2021.

Scoggins is Founder and Managing Partner of Millennial Energy Partners (“Millennial”), an energy asset management firm, where he has worked since July 2012.

Prior to founding Millennial, Mr.

Scoggins led BG Group’s commercial and operations teams on upstream, midstream and liquefied natural gas (“LNG”) investments in the United States, Canada, Chile, Equatorial Guinea and Trinidad and Tobago from July 2008 to July 2012.

Prior to joining BG Group, Mr.

Scoggins was Strategic Planning Manager and Community and Public Relations Manager with Marathon Oil from August 2005 until July 2008.

Scoggins began his oil and gas career in 2004 with Bechtel Corporation as Project Controls Engineer residing in Equatorial Guinea, West Africa.

Scoggins served as a member of the board of directors of Ultra Petroleum Corp.

from October 2018 until August 2020.

Scoggins also served as a member of the board of directors of Amplify Energy Corp., where he was Chairman of the Audit Committee, from April 2017 until its merger with Midstates Petroleum Company, Inc.

in August 2019.

Scoggins is a member of Vanderbilt University’s College of Arts & Sciences Campaign Cabinet and an Advisory Board member of Georgetown University’s Master of Science in Foreign Service program.

Scoggins received his Bachelor of Science in Economics and History from Vanderbilt University, where he graduated Phi Beta Kappa and magna cum laude.

He earned his Master of Science in Foreign Service with a focus on international business and development from Georgetown University.

The Board believes Mr.

Scoggins’s significant financial and investment expertise as well as his operation and managerial experience in the upstream oil and gas exploration and production business provide him with the qualifications and skills to serve as a Company director.

The Board believes Mr.

Wells’s public company experience, financial expertise, extensive industry experience and experience overseeing investments in the LNG sector provides him with the qualifications and skills to serve as a Company director.

Identification of E XECUTIVE O FFICERS

The names, ages as of March 22, 2022, position and other information concerning our executive officers are set forth below.

Chairman and Chief Executive Officer

Chief Financial Officer

Ivan Van der Walt (2)

Chief Operating Officer

Vera de Gyarfas (3)

General Counsel and Corporate Secretary

On January 18, 2021, the Board appointed Brent Wahl as the Chief Financial Officer of the Company, effective February 1, 2021.

Benjamin Atkins served as the Chief Financial Officer of the Company until such date.

On June 17, 2021, the Board appointed Ivan Van der Walt as Chief Operating Officer of the Company, effective July 1, 2021.

On June 17, 2021, the Board appointed Vera de Gyarfas as General Counsel and Corporate Secretary of the Company, effective July 12, 2021. 

Krysta De Lima served as General Counsel and Corporate Secretary until such date.

Schatzman  is the Company’s Chief Executive Officer.

Schatzman previously served as the Company’s President from September 2017 until June 2019.

Please refer to the section titled “Identification of Directors”

for additional information with respect to Mr.

Schatzman’s background and experience.

Wahl  is the Company’s Chief Financial Officer and was appointed to such office in February 2021.

Wahl served as the Senior Vice President, Finance, of the Company from June 2019 until his appointment as Chief Financial Officer in February 2021.

Prior to joining the Company, Mr.

Wahl was a Senior Managing Director and Head of Midstream Investment Banking for North America at Macquarie Capital.  Mr.

Wahl has more than 20 years of experience in the banking and energy industries, having also worked at JPMorgan Chase & Co.

and Bank of America. 

Wahl holds a Bachelor’s Degree in Economics from the University of Western Ontario and a Master’s Degree in Business Administration from the Richard Ivey School of Business at the University of Western Ontario.

Ivan Van der Walt  is the Company’s Chief Operating Officer and was appointed to such office in July 2021.

Van der Walt served as the Senior Vice President, Engineering and Construction, of the Company from July 2018 until his appointment as Chief Operating Officer in July 2021. 

Prior to joining the Company, Mr.

Van der Walt was a Deputy Project Director at Chicago Bridge & Iron Company (now McDermott International (“McDermott”)) from May 2016 until May 2018.  Mr.

Van der Walt has nearly 30 years of experience in the oil and gas industry, including senior roles with McDermott and Chevron.

He also previously served as chief executive of the Australasian division of the KNM Group.

Van der Walt has management experience on multiple LNG projects including Darwin LNG, Woodside LNG Train 5, Pluto LNG, Gorgon LNG, and Cameron LNG.

Van der Walt has provided dynamic and motivational leadership with a demonstrated ability to deliver results in diverse and challenging business environments and has successfully managed cross‐country pipelines and compressor station projects in support of the LNG and power industries.

Van der Walt holds a Bachelor of Science in Engineering Technology.

Vera de Gyarfas is the Company's General Counsel and Corporate Secretary and was appointed to such office in July 2021.

de Gyarfas has nearly 30 years of legal experience in the global energy industry having responsibility for oversight of all legal, corporate governance, compliance, litigation, regulatory, and outside counsel management.

Prior to joining NextDecade, she was previously a partner in Mayer Brown LLP’s Houston office and a member of the firm’s Oil & Gas industry group from December 2019 to July 2021 and a partner in the Global Transactions practice group at King & Spalding LLP from January 2011 to December 2019.

de Gyarfas has extensive LNG industry experience, including having represented Anadarko Petroleum Corporation as operator of the Area 1 Block and developer of an LNG project in Mozambique, structuring, and negotiating investments agreements, commercial contracts, LNG Sale and Purchase Agreements, and other activities in support of LNG project developers, buyers, and investors.

de Gyarfas is U.S.

Regional Director for the Association of International Petroleum Negotiators and Vice Chair of the International Committee of the Institute for Energy Law.

Delinquent Section 16(a) Reports 

Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires Company directors, officers and persons owning more than ten percent (10%) of a registered class of Company equity securities to file reports of ownership and changes of ownership with the SEC.

To our knowledge and based solely on the Company’s review of the Forms 3 and 4 and any amendments thereto and certain written representations from certain reporting persons that no other reports were required, the Company believes that directors, officers and stockholders owning more than ten percent (10%) of a registered class of Company equity securities complied with their Section 16(a) filing requirements applicable to them on a timely basis during the fiscal year ended December 31, 2021, except for Brent Wahl, who filed a late Form 4 with respect to the payment of withholding tax obligations associated with the vesting of a time-based restricted stock award on June 17, 2021.

Stockholder Nominees for Director

There have been no material changes to the procedures by which stockholders may recommend nominees to the Board.

Committees of the Board

The Board has an Audit Committee, a Nominating and Corporate Governance Committee, a Compensation Committee, a Finance and Risk Committee (the “F&R Committee”), and an Operations Committee.

Audit Committee

The Board has established the Audit Committee to assist in fulfilling the oversight responsibilities with respect to the Company’s accounting and financial reporting processes and its compliance with legal and financial regulatory requirements.

The Audit Committee is currently comprised of Messrs. Kripalani, Scoggins, and Wells, with Mr.

Wells serving as Chairman.

The Audit Committee operates under a written charter adopted by the Board.

The Board has determined that each director currently serving on the Audit Committee qualifies as an independent director under the rules and regulations of the SEC and Nasdaq with respect to audit committee membership.

The Board has also determined that Mr.

Wells qualifies as an “audit committee financial expert”

as defined in Item 407(d)(5)(ii) of Regulation S-K of the Exchange Act and possesses the requisite accounting or related financial management expertise as required under the Nasdaq listing standards.

The Audit Committee met four times in 2021.

Nominating and Corporate Governance Committee

The Board has established the NCG Committee to assist in fulfilling oversight responsibilities with respect to the management of the Board’s organization, membership and structure, and corporate governance.

The NCG Committee is currently comprised of Sir Frank and Messrs.

Al Romaithi, Vrattos, and Wells.

The NCG Committee operates under a written charter adopted by the Board.

The Board has determined each director currently serving on the NCG Committee qualifies as an independent director under the Nasdaq listing rules.

The NCG Committee met twice in 2021.

Compensation Committee

The Board has established the Compensation Committee to assist in fulfilling the oversight responsibilities with respect to the Company’s employee compensation policies and practices and reviewing and approving incentive compensation and equity compensation policies and programs.

The Compensation Committee is currently comprised of Messrs.

Belke, Al Romaithi, and Kripalani, with Mr.

Belke serving as Chairman.

The Compensation Committee operates under a written charter adopted by the Board.

The Board has determined each director currently serving on the Compensation Committee qualifies as an independent director under the Nasdaq listing rules.

The Compensation Committee met ten times in 2021.

F&R Committee

The Board has established the F&R Committee to assist in fulfilling the oversight responsibilities with respect to the Company’s financial planning, capital structure, liquidity, financings and other capital markets transactions, and risk management strategy, policies, procedures, measurement, and mitigation efforts, including insurance programs.

The F&R Committee is currently comprised of Messrs.

Belke, Al Romaithi, Kripalani, and Schatzman.

The F&R Committee is charged, under its written charter, to assist the Board in fulfilling its responsibilities to oversee the Company’s capital plan, capital structure and management, risks and insurance programs.

Operations Committee

The Board has established the Operations Committee to assist in fulfilling oversight responsibilities with respect to the strategy and execution of the Company’s business plans.

The Operations Committee is currently comprised of Sir Frank and Messrs.

Belke, Kripalani, Schatzman, and Vrattos.

Other Board members have standing invitations to attend all meetings of the Operations Committee.

The Operations Committee is charged, under its written charter, to assist the Board and executive management in fulfilling its responsibilities to oversee the strategy and execution of the Company’s business plans.

Availability of Certain Committee Charters and Other Information  

The charters for the Audit Committee, the NCG Committee, Compensation Committee, the Operations Committee, and the F&R Committee, as well as the Corporate Governance Guidelines, Code of Conduct and Ethics (the “Code of Conduct”), and Whistleblower Policy can be found, free of charge, on the Corporate Governance page under the “Investors”

section of the Company’s website, 

www.next-decade.com .

The Code of Conduct is applicable to all directors, officers and employees.

The Company intends to disclose any changes to, or waivers from, the provisions of the Code of Conduct that would otherwise be required to be disclosed under Item 5.05 of a Form 8-K on the Company’s website.

The Company will also provide printed copies of these materials to any stockholder or other interested person upon request to NextDecade Corporation, Attention:

Vera de Gyarfas, General Counsel and Corporate Secretary, 1000 Louisiana Street, Suite 3900, Houston, Texas 77002.

The information on the Company’s website is not, and shall not be deemed to be, a part of this Annual Report on Form 10-K or incorporated into this Annual Report on Form 10-K.

E XECUTIVE C OMPENSATION

As a “smaller reporting company”, we have opted to comply with the executive compensation disclosure rules applicable to “smaller reporting companies.”

2021 Summary Compensation Table

The following table sets forth all compensation paid, payable, awarded, granted, given, or otherwise provided, directly or indirectly, by the Company or its subsidiaries, in U.S.

dollars, to the Company’s named executive officers.

Bonus ($) (1)

Chairman and Chief Executive Officer

Chief Financial Officer

Ivan Van der Walt

Chief Operating Officer

Annual bonuses are paid in the first quarter following the applicable year of service.

The amount noted reflects the grant date fair value, based on the closing price of Company common stock on the date of grant, of (i) 123,500 shares that vest on the first anniversary of January 25, 2021, (ii) 225,800 RSUs (defined below) and (iii) 2,032,000 PSUs (defined below).

The amount noted reflects a voluntary ten percent reduction in base salary effective June 1, 2020 through the end of 2020 in connection with the 2019 novel coronavirus pandemic and its impact on the Company’s business and operating results.

The amount noted reflects the grant date fair value, based on the closing price of Company common stock on the date of grant, of (i) 32,000 shares that vest on the first anniversary of January 25, 2021, (ii) 50,000 shares that vest upon the FID Milestone, (iii) 65,600 RSUs (defined below) and (iv) 590,600 PSUs (defined below).

The amount noted reflects the grant date fair value, based on the closing price of Company common stock on the date of grant, of (i) 45,000 shares that vest in equal installments on the first, second and third anniversaries of January 4, 2021, (ii) 45,000 shares that vest upon the FID Milestone, (iii) 52,500 shares that vest on the first anniversary of January 25, 2021, (iv) 70,900 RSUs (defined below) and (iv) 637,900 PSUs (defined below).

Narrative Disclosure

2021 Employee Retention Incentive Plan

During 2021, the Board, following its review of an analysis of the compensation arrangements of the Company’s executive officers and employees performed by the Company’s independent compensation consultant, Meridian Compensation Partners, LLC, on the recommendation of the Compensation Committee, adopted an employee retention incentive plan (the “2021 ERIP”) under the Company's 2017 Omnibus Incentive Plan, as amended (the “2017 Equity Plan”), designed to enhance the Company’s ability to retain key employees and align executive compensation with performance to the Company’s stockholders. 

Under the 2021 ERIP, the Company’s employees, including the named executive officers, received grants of two types of restricted stock units under the 2017 Equity Plan:

time-based restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”). 

Each restricted stock unit entitles the recipient to receive one share of the Company’s common stock upon satisfaction of the relevant conditions established pursuant to the applicable award.

The RSUs vest ratably over a three-year period, with a third of the RSUs granted to an individual vesting on the successive anniversaries of the grant date. 

The PSUs become earned to the recipient, but remain unvested, upon the achievement of either of two performance criteria:

achievement of a final investment decision by the Board with respect to the first two trains of RGLNG (the “FID Trigger”) or achievement of certain trading prices of the Company’s common stock (the “Trading Price Triggers”).

PSUs that become earned to the recipient vest ratably over a three-year period, with a third of such PSUs vesting on the successive anniversaries of the FID Trigger or Trading Price Trigger, as applicable.

The forms of award agreement of the RSUs and PSUs are filed as Exhibits 10.32 and 10.33 to this Annual Report on Form 10-K.

The Company issued an aggregate of 7,153,500 restricted stock units in connection with the 2021 ERIP, of which 775,900 were RSUs and 6,377,600 were PSUs.

The Company expects to utilize restricted stock units of both types as a key, long-term component of executive compensation going forward, in amounts and subject to the conditions to be established by the Compensation Committee. 

The Company may also, from time to time, grant additional, similar time-based or performance-based awards to its employees, which may include its executive officers, with different vesting schedules or performance criteria, as appropriate, in any given year based on performance, retention needs or other factors that the Compensation Committee deems relevant.

Overview of Compensation for Matthew K.

Schatzman, Chairman of the Board and Chief Executive Officer 

Schatzman has served as Chief Executive Officer of the Company since February 2018.

In June 2019, Mr.

Schatzman was appointed Chairman of the Board.

From September 2017 until his appointment as Chairman of the Board, Mr.

Schatzman served as the Company’s President.

The Schatzman Employment Agreement provided for a term through June 30, 2022 and will be automatically extended for additional one-year periods unless and until the Company or Mr.

Schatzman gives to the other written notice at least one-hundred and eighty (180) days prior to the applicable renewal date of a decision not to renew for an additional year. 

On September 27, 2021, the Nominating and Corporate Governance Committee approved an extension of the Schatzman Employment Agreement to June 30, 2023.

Effective January 1, 2019, the Schatzman Employment Agreement was amended to reflect (i) an increase in his annual base salary to $617,500 from $550,000 and (ii) an increase in his target annual bonus to 100% from 90% of his base salary based upon the achievement of performance targets established by the Board from time to time. Effective June 1, 2021, the Schatzman Employment Agreement was amended to reflect (i) an increase in his annual base salary to $650,000 and (ii) an increase in his target annual bonus to 110% of base salary based upon the achievement of performance targets established by the Board from time to time.

The Schatzman Employment Agreement entitled him to an incentive grant of restricted shares of Common Stock.

Pursuant to a restricted stock award agreement dated January 8, 2018 (the “Schatzman Award Agreement”), the Company granted Mr.

(i) 48,450 fully vested shares of Common Stock and (ii) 1,052,492 shares of Common Stock with vesting terms set forth in the Schatzman Award Agreement (the “Restricted Incentive Stock”).

Pursuant to the Schatzman Employment Agreement, (i) an aggregate of 210,498 shares of the Restricted Incentive Stock vested in three equal annual installments beginning on September 18, 2019, (ii) 52,625 shares of Restricted Incentive Stock vested upon execution by the Company of a final agreement with an engineering, procurement and construction (EPC) contractor for an LNG facility, (iii) 210,498 shares of Restricted Incentive Stock will vest upon execution of one or more binding tolling or LNG sales and purchase agreements, with customary conditions precedent, providing for an aggregate of at least 3.825 million tons per annum, and (iv) 578,871 shares of Restricted Incentive Stock will vest upon a positive Final Investment Decision for an LNG project providing for an aggregate of at least 4 million tonnes per annum, in each case subject to continued service.

The Schatzman Employment Agreement also provides that if the Company at any time terminates Mr.

Schatzman’s employment without Cause (as defined in the Schatzman Employment Agreement), or if Mr.

Schatzman voluntarily terminates the agreement with Good Reason (as defined in the Schatzman Employment Agreement), Mr.

Schatzman will be entitled to (i) a lump sum cash payment equal to the sum of his then current base salary for a period of 12 months, (ii) a pro-rata portion of his annual bonus for the fiscal year in which the termination occurs (based on an amount equal to his then applicable annual bonus target percentage multiplied by his then applicable base salary) and (iii) the full vesting of unvested Restricted Incentive Stock.

If the Company elects not to renew the Schatzman Employment Agreement by providing notice of non-renewal at least 180 days before the end of the then current term, Mr.

Schatzman will be entitled to a lump sum cash payment equal to the sum of his then current base salary for a period of 12 months and a pro-rata portion of his annual bonus for the fiscal year in which the termination occurs (based on an amount equal to his then applicable annual bonus target percentage multiplied by his then applicable base salary).

Schatzman’s prior grant of Restricted Incentive Stock, to the extent then vested, shall remain outstanding in accordance with their terms and any unvested Restricted Incentive Stock shall lapse and be forfeited.

Additionally, upon a Change in Control (as defined in the Schatzman Employment Agreement), any unvested portion of his Restricted Incentive Stock shall immediately vest.

The Schatzman Employment Agreement also provides that Mr.

Schatzman is eligible for health insurance and disability insurance and other customary employee benefits.

The Schatzman Employment Agreement also contains customary non-competition and non-solicitation covenants and covenants regarding the treatment of confidential information.

Schatzman was awarded 2,257,800 restricted stock units pursuant to the 2021 ERIP, 90% of which were PSUs.

Overview of Compensation for Brent E.

Wahl, Chief Financial Officer

Wahl currently serves as Chief Financial Officer of the Company.

There is no employment agreement with Mr.

Wahl and his employment is “at will.”

Wahl’s annual base salary effective for the year ended December 31, 2021 was  $400,000.

Wahl is eligible for an annual bonus with a target of 90% of his annual base salary based upon the achievement of performance targets established by the Board from time to time.

There is no minimum threshold for any such bonus.

Wahl is eligible for health insurance and disability insurance and other customary employee benefits.

Wahl was awarded 656,200 restricted stock units pursuant to the 2021 ERIP, 90% of which were PSUs.

Overview of Compensation for Ivan Van der Walt, Chief Operating Officer

Van der Walt currently serves as Chief Operating Officer of the Company.

There is no employment agreement with Mr.

Van der Walt and his employment is “at will.”

Van der Walt’s annual base salary effective for the year ended December 31, 2021 

was $430,000.

Van der Walt is eligible for an annual bonus with a target of 90% of his annual base salary based upon the achievement of performance targets established by the Board from time to time.

There is no minimum threshold for any such bonus.

Van der Walt is eligible for health insurance and disability insurance and other customary employee benefits.

Van der Walt was awarded 708,800 restricted stock units pursuant to the 2021 ERIP, 90% of which were PSUs.

Termination and Change in Control

The Schatzman Employment Agreement provides for the payment of certain severance benefits upon termination.

For additional information about the payment of certain severance benefits upon termination, including in connection with a change of control, please see the overview of compensation for the Company’s named executive officers and the footnotes to the Outstanding Equity Awards Table.

Pension/Retirement Benefits

The Company does not provide a qualified defined benefit pension plan or any non-qualified supplemental executive retirement benefits to any of its executive officers or directors.

However, eligible executive officers and directors participate in a defined contribution retirement plan (the “401(k) Plan”) which allows them to contribute up to 100% of their compensation up to the maximum permitted by the Internal Revenue Code.

The Company does not make matching contributions.

The 401(k) Plan is sponsored and maintained by the Company.

Additional Benefit Programs

Certain officers and directors are entitled to the following benefits:

parking, health insurance, life insurance and accidental death and dismemberment.

Outstanding Equity Awards at Fiscal 2021 Year-End

The following table provides information concerning outstanding equity awards as of December 31, 2021 granted to the Company’s named executive officers.

Number of shares or units of stock that have not vested (#)

Market value of shares or units of stock that have not vested ($) 

Equity incentive plan awards:

Number of unearned shares, units or other rights that have not vested (#)

Equity incentive plan awards:

Market or payout value of unearned shares, units or other rights that have not vested ($) 

Ivan Van der Walt

The market value of the unvested stock awards is based on the closing price of Common Stock on December 31, 2021 ($2.85).

Reflects the unvested portion of restricted stock or stock-based awards that vests as follows:

(i) 123,500 shares vest on the first anniversary of January 25, 2021 and (ii) 225,800 RSUs that vest in three equal installments on the first, second and third anniversaries of August 2, 2021. 

Reflects the unvested portion of the Restricted Incentive Stock that vests as follows:

(i) 210,498 shares vest upon execution of one or more binding tolling or LNG sales and purchase agreements, with customary conditions precedent, providing for an aggregate of at least 3.825 million tons of LNG per annum (the “LNG SPA Milestone”) and (ii) 578,871 shares vest upon the affirmative vote of the Board to make a final investment decision on the Company's Rio Grande LNG project (the “FID Milestone”). 

Also reflects 2,032,000 PSUs that vest ratably over a three-year period beginning on the first anniversary of the occurrence of the FID Trigger or the Trading Price Triggers.

Reflects the unvested portion of a restricted stock award that vests as follows:

(i) 50,000 shares vest on the third anniversary of June 17, 2019, (ii) 32,000 shares vest on the first anniversary of January 25, 2021 and (iii) 65,600 RSUs that vest in three equal installments on the first, second and third anniversaries of August 2, 2021.

Reflects the unvested portion of restricted stock awards that vests as follows:

(i) 150,000 shares vest upon the FID Milestone and (ii) 590,600 PSUs that vest ratably over a three-year period beginning on the first anniversary of the occurrence of the FID Trigger or the Trading Price Triggers. 

Reflects the unvested portion of a restricted stock award that vests as follows:

(i) 45,000 shares vest in three equal installments on the first, second and third anniversaries of January 4, 2021, (ii) 52,500 shares vest on the first anniversary of January 25, 2021 and (iii) 70,900 RSUs that vest in three equal installments on the first, second and third anniversaries of August 2, 2021.

Reflects the unvested portion of the Restricted Incentive Stock that vests as follows:

(i) 14,400 shares vest upon the LNG SPA Milestone, (ii) 78,600 shares vest upon the FID Milestone and (iii) 637,900 PSUs that vest ratably over a three-year period beginning on the first anniversary of the occurrence of the FID Trigger or the Trading Price Triggers.

2017 Equity Plan

On December 15, 2017, the Company’s stockholders approved the 2017 Equity Plan and the 2017 Equity Plan became effective by its terms on such date.

On June 15, 2020, the Company’s stockholders approved an amendment to the 2017 Equity Plan to increase the amount of awards thereunder that can be granted to the Company’s non-employee directors in any calendar year.

On June 15, 2021, the Company's stockholders approved an amendment to the 2017 Equity Plan to increase the maximum number of shares available thereunder and remove certain individual limits on shares issuable under such plan during a calendar year.

The purpose of the 2017 Equity Plan is to further align the interests of eligible participants with those of the Company’s stockholders by providing long-term incentive compensation opportunities tied to the performance of the Company and its Common Stock.

Persons eligible to receive awards under the 2017 Equity Plan include our employees, non-employee members of the Board, consultants, or other personal service providers of the Company or any of its subsidiaries.

Currently, the 2017 Equity Plan authorizes the issuance of up to 15,262,461 shares of Common Stock, subject to certain adjustments under the 2017 Equity Plan.

Awards covering 8,465,332 shares of Common Stock were granted under the 2017 Equity Plan during the fiscal year 2021.

Equity Compensation Plan Information

The following provides certain aggregate information with respect to the Company’s equity compensation plans in effect as of December 31, 2021.

Plan Category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in first column)

Equity Compensation Plans Approved by Security Holders

Equity Compensation Plans Not Approved by Security Holders

Consists of shares of Common Stock issuable in respect of outstanding awards granted under the 2017 Equity Plan.

DIRECTOR COMPENSATION

The following table details the compensation received by each non-employee member of the Board who has not been appointed to the Board pursuant to any agreement or arrangement with the Company (“At-large Director”) and who served during the fiscal year ended December 31, 2021.

Fees Earned or paid in Cash ($)

Stock Awards ($)

Sir Frank Chapman

Edward Andrew Scoggins, Jr.

Spencer Wells

The amount noted consists of (i) $80,000 paid as annual retainer fees, (ii) $15,000 paid for his service as the Chairman of the Compensation Committee, and (iii) $15,000 paid for his service as Chairman of the F&R Committee, all of which were earned and paid pursuant to the Company’s director compensation policy described below.

The amount noted reflects the grant date fair value, based on the closing price of Common Stock on the date of grant of $2.33 per share, of 51,503 restricted shares of Common Stock granted on January 31, 2021, which vested in four installments on March 31, 2021, June 30, 2021, September 30, 2021 and December 31, 2021.

The amount noted consists of (i) $80,000 paid as annual retainer fees and (ii) $15,000 paid for his service as the Chairman of the Nominating and Governance Committee, all of which were earned and paid pursuant to the Company’s director compensation policy described below.

The amount noted consists of annual retainer fees, pro-rated for partial service during 2021, of which were earned and paid pursuant to the Company's director compensation policy described below.

The amount noted reflects the grant date fair value, based on the closing price of Common Stock on the date of grant of $2.03 per share, of 41,380 restricted shares of Common Stock granted on May 7, 2021, which vested in three installments on June 30, 2021, September 30, 2021 and December 31, 2021.

The amount noted consists of (i) $80,000 paid as annual retainer fees, (ii) $15,000 paid as ad hoc committee fees, and (iii) $20,000 paid for his service as Chairman of the Audit Committee, all of which were earned and paid pursuant to the Company’s director compensation policy described below.

Narrative Discussion

Effective October 2019, the Board, following its review of an analysis of a selected group of energy and general industry companies’

director compensation programs performed by the Company’s independent compensation consultant, Meridian Compensation Partners, LLC, on the recommendation of the Compensation Committee, adopted a director compensation policy (the “Director Compensation Policy”) designed to provide a total compensation package that enables the Company to attract and retain, on a long-term basis, highly qualified At-large Directors.

Under the Director Compensation Policy, which was amended in December 2019 to modify the form and timing of consideration paid thereunder, each At-large Director is paid an annual cash retainer of $80,000 (the “Annual Board Cash Retainer”), which At-large Directors may elect to receive in the form of shares of restricted stock in lieu of cash, and an annual cash retainer of $15,000 for each standing committee of the Board of which such director serves as the chairperson, except that the chairperson of the Audit Committee is entitled to receive an annual cash retainer of $20,000.

The annual cash retainers are prorated for partial years of service.

In addition, under the Director Compensation Policy, each At-large Director will be granted, in one or more installments, a number of shares of Common Stock equal to $120,000 divided by the closing price of the Common Stock on Nasdaq on the date of such grant or, if such grant date was not a trading day, then the last trading day occurring prior to such grant date.

The awards of shares of restricted Common Stock to be issued will be prorated based on the actual days of service on the Board and the terms and conditions of such awards, including vesting terms and transferability, will be as set forth in the Company’s standard award agreement, in the form adopted from time to time by the Board or the Compensation Committee, provided, that all such awards shall vest during the year in which they are granted.

The shares of Common Stock issued under the Director Compensation Policy are issued under and subject to the 2017 Equity Plan or any successor plan.

There are no per meeting attendance fees for At-large Directors for attending Board meetings.

Each director of the Company, including Board observers, are entitled to receive reimbursement of all reasonable out-of-pocket expenses incurred in connection with attending meetings of the Board.

Such reimbursement is in addition to the compensation provided for the Director Compensation Policy.

The Company adopted a stock ownership policy for At-large Directors in December 2019.

Pursuant to such policy, At-large Directors are expected to own a number of shares of Common Stock equal to five times the Annual Board Cash Retainer divided by the closing price of the Common Stock on Nasdaq on the date of calculation.

The number of shares of Common Stock to be held by At-large Directors will be calculated on the first trading day of each calendar year based on such shares’

fair market value.

Each At-large Director is expected to satisfy the stock ownership requirement within three years of the date such individual became subject to the policy or the date of any increase in the Annual Board Cash Retainer.

S ECURITY O WNERSHIP O F C ERTAIN B ENEFICIAL O WNERS AND M ANAGEMENT AND R ELATED S TOCKHOLDER M ATTERS

The following table sets forth certain information regarding the beneficial ownership of our voting securities as of March 22, 2022:

each person who is known to us to be the beneficial owner of more than 5% of our voting securities;

each of our directors;

each of our named executive officers and all executive officers and directors as a group.

Such table is based on information supplied by officers, directors, principal stockholders and the Company’s transfer agent, and information contained in Schedules 13D and 13G filed with the SEC.

Unless otherwise indicated, each person named below has an address in care of our principal executive offices and has sole power to vote and dispose of the shares of voting securities beneficially owned by them, subject to community property laws where applicable. 

Amounts in the table below do not include restricted stock units that do not include the right to vote shares of common stock that may be delivered at settlement thereof.

Shares of common stock beneficially owned(**)

Percentage of common stock beneficially owned(%)

Shares of Series A Convertible Preferred Stock beneficially owned(**)

Percentage of Series A Convertible Preferred Stock beneficially owned(%)

Shares of Series B Convertible Preferred Stock beneficially owned(**)

Percentage of Series B Convertible Preferred Stock beneficially owned(%)

Shares of Series C Convertible Preferred Stock beneficially owned(**)

Percentage of Series C Convertible Preferred Stock beneficially owned(%)

Executive Officers and Directors:

Ivan Van der Walt

Avinash Kripalani

William Vrattos

Spencer Wells

Khalifa Abdulla Al Romaithi

Sir Frank Chapman

Edward Andrew Scoggins, Jr.

All directors and executive officers as a group (11 persons)

5% Stockholders:

Ninteenth Investment Company

YCMGA Entities

Valinor Entities

Bardin Hill Entities

HGC NEXT INV LLC (16)

BlackRock, Inc.

Avenue Energy Opportunities Fund II, L.P.

OGCI Climate Investments Holding LLP (20)

TEP Next Decade, LLC (21)

Indicates beneficial ownership of less than 1% of the total outstanding Common Stock.

“Beneficial ownership” is a term broadly defined by the SEC in Rule 13d-3 under the Exchange Act and includes more than typical forms of stock ownership, that is, stock held in the person’s name.

The term also includes what is referred to as “indirect ownership,” meaning ownership of shares as to which a person has or shares investment or voting power.

For purposes of this table, shares of Common Stock not outstanding that are subject to options, warrants, rights or conversion privileges exercisable within 60 days of March 22, 2022 are deemed outstanding for the purpose of calculating the number and percentage owned by such person, but not deemed outstanding for the purpose of calculating the percentage owned by each other person listed.

Since the Series A Preferred Stock, the Series B Preferred Stock, the Series C Preferred Stock, the warrants issued together with the Series B Preferred Stock (the “Series B Warrants”), and the Series C Warrants are not convertible into, or exercisable for, Common Stock within 60 days of March 22, 2022, shares of Common Stock issuable upon such conversion or exercise are not reflected as beneficially owned by the respective principal stockholders in the table above.

Includes 789,369 shares of restricted stock subject to performance-based vesting requirements issued under the 2017 Equity Plan.

Includes 50,000 shares of restricted stock subject to time-based vesting requirements and 150,000 shares of restricted stock subject to performance-based vesting requirements, in each case issued under the 2017 Equity Plan.

Includes 30,000 shares of restricted stock subject to time-based vesting requirements and 93,000 shares of restricted stock subject to performance-based vesting requirements, in each case issued under the 2017 Equity Plan.

Ninteenth is a limited liability company organized under the laws of the Emirate of Abu Dhabi.

Mubadala Investment Company PJSC, a public joint stock company established under the laws of the Emirate of Abu Dhabi, is the sole owner of Mamoura Diversified Global Holding PJSC, a public joint stock company established under the laws of the Emirate of Abu Dhabi, which owns 99% of Ninteenth.  Accordingly, Mubadala Investment Company PJSC and Mamoura Diversified Global Holding PJSC may be deemed to have shared voting and investment power over the shares held by Ninteenth. Ninteenth’s address is Al Mamoura A, P.O.

Box 45005, Abu Dhabi, United Arab Emirates. 

Consists of 12,628,348 shares of Common Stock held by York Credit Opportunities Investments Master Fund, L.P.; 2,522,723 shares of Common Stock held by York European Distressed Credit Fund II, L.P.;

13,567,803 shares of Common Stock held by York Multi-Strategy Master Fund, L.P.;

11,751,923 shares of Common Stock held by York Credit Opportunities Fund, L.P.;

5,705,260 shares of Common Stock held by York Capital Management, L.P.;

and 8,161,422 shares of Common Stock held by York Select Strategy Master Fund L.P.

(together with York Tactical Energy Fund, L.P.

(“York Tactical”) and York Tactical Energy Fund PIV-AN, L.P.

(“York Tactical PIV”), the “YCMGA Entities”).  York Capital Management Global Advisors, LLC (“YCMGA”) is the senior managing member of the general partner of each of the YCMGA Entities.  James G.

Dinan is the chairman of, and controls, YCMGA.

Each of YCMGA and James G.

Dinan has voting and investment power with respect to the securities owned by each of the YCMGA Entities and may be deemed to be beneficial owners thereof.

Each of YCMGA and James G.

Dinan disclaims beneficial ownership of the reported securities except to the extent of their pecuniary interests therein.

The business address of the YCMGA Entities is 767 Fifth Avenue, 17th Floor, New York, NY 10153.

Consists of 3,850 shares of Series A Preferred Stock held by York Credit Opportunities Investments Master Fund, L.P.;

770 shares of Series A Preferred Stock held by York European Distressed Credit Fund II, L.P.;

4,137 shares of Series A Preferred Stock held by York Multi-Strategy Master Fund, L.P.;

3,580 shares of Series A Preferred Stock held by York Credit Opportunities Fund, L.P.;

and 2,815 shares of Series A Preferred Stock held by York Capital Management, L.P.  None of such shares are convertible into shares of Common Stock within 60 days of March 22, 2022.

Consists of 2,309 shares of Series B Preferred Stock held by York Tactical and 4,624 shares of Series B Preferred Stock held by York Tactical PIV (together with York Tactical, the “York Tactical Energy Funds”).

None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

Consists of 2,235 shares of Series C Preferred Stock held by York European Distressed Credit Fund II, L.P.;

963 shares of Series C Preferred Stock held by York Capital Management, L.P.;

1,563 shares of Series C Preferred Stock held by York Credit Opportunities Fund, L.P.;

1,787 shares of Series C Preferred Stock held by York Credit Opportunities Investment Master Fund, L.P.;

1,270 shares of Series C Preferred Stock held by York Multi-Strategy Master Fund, L.P.;

1,863 shares of Series C Preferred Stock held by York Tactical;

and 3,728 shares of Series C Preferred Stock held by York Tactical PIV.

None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

Consists of 10,904,733 shares of Common Stock held by Valinor Capital Partners Offshore Master Fund, L.P.

(“Valinor Offshore Master”) and 3,832,630 shares of Common Stock held by Valinor Capital Partners, L.P. (“Valinor Capital” and, together with Valinor Offshore Master, the “Valinor Entities”).  Valinor serves as investment manager to each of the Valinor Entities.

David Gallo is the Founder, Managing Partner, and Portfolio Manager of Valinor and is the managing member of Valinor Associates, LLC (“Valinor Associates”), which serves as general partner to Valinor Capital Partners, L.P.

and Valinor Capital Partners Offshore Master Fund, L.P.. Each of Valinor Management, Valinor Associates and David Gallo may be deemed to beneficially own the securities held by such fund and each of Valinor Management, Valinor Associates and David Gallo disclaims beneficial ownership of the reported securities, except to the extent of its or his pecuniary interest.  The business address of the Valinor Entities is 510 Madison Avenue, 25th Floor, New York, NY 10022.

Consists of 3,836 shares of Series A Preferred Stock held by Valinor Capital Partners Offshore Master Fund, L.P.

and 1,345 shares of Series A Preferred Stock held by Valinor Capital Partners, L.P.

None of such shares are convertible into shares of Common Stock within 60 days of March 22, 2022.

Consists of 5,134 shares of Series B Preferred Stock held by Valinor Capital Partners Offshore Master Fund, L.P.

and 1,798 shares of Series B Preferred Stock held by Valinor Capital Partners, L.P.

None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

Consists of 332,852 shares of Common Stock held by Bardin Hill Event-Driven Master Fund LP;

4,113,065 shares of Common Stock held by HCN L.P.;

658,259 shares of Common Stock held by First Series of HDML Fund I LLC (“First Series HDML” and, together with Bardin Hill Event-Driven and First Series HDM, the “Bardin Hill Series B Purchasers”); 2,641,178 shares of Common Stock held by Halcyon Mount Bonnell Fund LP (“Halcyon Mount Bonnell”);

and 1,741,349 shares of Common Stock held by Halcyon Energy, Power, and Infrastructure Capital Holdings LLC (together with the Bardin Hill Series B Purchasers and Halcyon Mount Bonnell, the “Bardin Hill Entities”).

Beneficial ownership includes 107,500 shares of Common Stock issuable upon exercise of warrants held by Bardin Hill Event-Driven Master Fund LP.

Bardin Hill serves as the investment manager to each of the Bardin Hill Entities. Investment decisions of Bardin Hill are made by one or more of its portfolio managers, including Jason Dillow, Kevah Konner, John Greene and Pratik Desai, each of whom has individual decision-making authority.  Jason Dillow is the Chief Executive Officer and Chief Investment Officer of Bardin Hill. Each of Bardin Hill, HCN GP LLC (in the case of HCN LP), Bardin Hill Fund GP LLC (in the case of Bardin Hill Event-Driven Master Fund LP,  First Series of HDML Fund I LLC and Halcyon Mount Bonnell Fund LP), Jason Dillow, Kevah Konner, John Greene and Pratik Desai may be deemed to beneficially own the securities held by such Bardin Hill Entity and each of Bardin Hill, HCN GP LLC, Bardin Hill Fund GP LLC, Jason Dillow, Kevah Konner,  John Greene and Pratik Desai disclaims beneficial ownership of the reported securities, except to the extent of its or his pecuniary interest.  The business address of the Bardin Hill Entities is 299 Park Avenue, 24th Floor, New York, NY 10171.

Consists of 710 shares of Series A Preferred Stock held by First Series of HDML Fund I LLC;

224 shares of Series A Preferred Stock held by Bardin Hill Event-Driven Master Fund LP;

and 1,552 shares of Series A Preferred Stock held by HCN L.P.  None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

Consists of 2,772 shares of Series B Preferred Stock held by First Series of HDML Fund I LLC;

244 shares of Series B Preferred Stock held by Bardin Hill Event-Driven Master Fund LP;

and 1,548 shares of Series B Preferred Stock held by HCN L.P.

None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

Consists of 255 shares of Series C Preferred Stock held by Bardin Hill Event-Driven Master Fund LP and 2,538 shares of Series C Preferred Stock held by HCN L.P.

None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

HGC is a Delaware limited liability company.

Haeyoung Lee is the sole Manager and the President of HGC and may be deemed to have voting and investment power over the shares held by HGC.  HGC’s address is 300 Frank W.

Burr Blvd., Suite 52, Teaneck, New Jersey 07666.

None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

The registered holders of the referenced shares are the following funds and accounts under management by investment adviser subsidiaries of BlackRock, Inc.:  ABR PE Investments II, LP, BOPA1, L.P., Coastline Fund, L.P., Fair Lane Investment Partners, L.P., Multi-Alternative Opportunities Fund (A), L.P., Multi-Alternative Opportunities Fund (B), L.P., Investment Partners V (A), LLC and SUNROCK DISCRETIONARY CO-INVESTMENT FUND II, LLC.  BlackRock, Inc.

is the ultimate parent holding company of such investment adviser entities.  On behalf of such investment adviser entities, the applicable portfolio managers, as managing directors (or in other capacities) of such entities, and/or the applicable investment committee members of such funds and accounts, have voting and investment power over the shares held by the funds and accounts which are the registered holders of the reported securities.

Such portfolio managers and/or investment committee members expressly disclaim beneficial ownership of the reported securities held by such funds and accounts.

The address of such funds and accounts, such investment adviser subsidiaries and such portfolio managers and/or investment committee members is 55 East 52nd Street, New York, New York 10055.

Shares listed in the table as beneficially owned may not incorporate all shares deemed to be beneficially held by BlackRock, Inc. None of such shares are convertible into shares of Common Stock by the holder within 60 days of March 22, 2022.

Avenue Capital Management II, L.P., in its capacity as investment manager, trading advisor, and/or general partner, may be deemed the beneficial owners of the shares held by Avenue Energy Opportunities Fund II, L.P. Avenue Capital Management II GenPar, LLC is the general partner of Avenue Capital Management II, L.P.

Marc Lasry is the managing member of Avenue Capital Management II GenPar, LLC.

Lasry may be deemed to be the indirect beneficial owner of the securities reported by the Avenue Energy Opportunities Fund II, L.P. by reason of his ability to direct the vote and/or disposition of such securities, and his pecuniary interest in such shares (within the meaning of Rule 16a-1(a)(2) under the Exchange Act) is a fractional interest in such amount.

Lasry disclaims beneficial ownership of such shares.

The address of Avenue Energy Opportunities Fund II, L.P.

is 11 West 42nd Street, 9th Floor, New York, NY 10036.

The registered holder of the referenced shares is OGCI. OGCI Climate Investments LLP, a limited liability partnership organized under the laws of England and Wales (“OGCI Parent”), controls OGCI by ownership of more than 99% of its equity and the ability to direct its management, including investment decisions. Pratima Rangarajan, in her capacity as CEO of OGCI and of OGCI Parent, exercises control over certain of their voting and investment decisions, including with respect to the referenced shares.

Accordingly, OGCI Parent and Ms.

Rangarajan may each be deemed to have shared voting and investment power over, and beneficial ownership (as defined by SEC Rule 13d–3 under the Exchange Act) of, the referenced shares held by OGCI.  The address of each of OGCI, OGCI Parent and Ms.

Rangarajan is 11-12 St.

James’s Square, London SW1Y 4LB, United Kingdom.

TEP Next Decade, LLC (“TEP Next Decade”) is a Delaware limited liability company.

TEP Next Decade is an affiliate of Energy & Power Transition Partners, LLC (“EPTP”) and EPTP may be deemed to have voting and investment power over the shares held by TEP Next Decade. 

TEP Next Decade’s address is 321 N.

Clark Street, Suite 2440, Chicago, IL 60654.

Item 13. Certain Relationships and Related T RANSACTIONS , AND D IRECTOR I NDEPENDENCe

The Board undertook a review of the independence of our directors and considered whether any director has a material relationship with us that could compromise his ability to exercise independent judgment in carrying out his responsibilities.

The Board considered the relationships that each director has with us and all other facts and circumstances the Board deemed relevant in determining his independence, including the beneficial ownership of Voting Shares owned by each director.

Based upon information requested from and provided by each director concerning his background, employment, affiliations and stock ownership, the Board has determined that each of Sir Frank and Messrs.

Al Romaithi, Belke, Jun, Kripalani, Scoggins, Vrattos, and Wells is independent under the Nasdaq listing rules.

The Board also determined that Thanasi Skafidas, who resigned from the Board on April 16, 2021, was independent under the Nasdaq listing rules.

Schatzman is not an independent director under the Nasdaq listing rules because he currently serves as the Chief Executive Officer of the Company.

The Board adopted a written Related Person Transaction Policy in October 2017, which addresses the reporting, review and approval or ratification of transactions with related persons.

Although related person transactions can involve potential or actual conflicts of interest, the Company recognizes that such transactions may occur in the normal course of business or provide an opportunity that is in the best interests of the Company.

The Related Person Transaction Policy is not designed to prohibit related person transactions;

rather, it is to provide for timely internal review of prospective transactions, approval or ratification of transactions and appropriate oversight and public disclosure of transactions.

Pursuant to the Related Person Transaction Policy, any transaction or arrangement or series of transactions or arrangements between the Company, any subsidiary of the Company or any other company controlled by the Company participates, whether or not the Company is a party, and a “related person”

in which such person will have a material direct or indirect interest must be submitted to the disinterested members of the Board for review, approval or ratification.

A “related person”

means any director, director nominee or executive officer of the Company, any holder of more than 5% of the outstanding voting securities of the Company, or any immediate family member of the foregoing persons.

The disinterested members of the Board will consider all relevant factors when determining whether to approve or ratify a related person transaction, including whether such transaction is in, or not inconsistent with, the best interests of the Company, and whether such transaction is comparable to a transaction that could be available on an arms-length basis or is on terms that the Company offers generally to persons who are not related persons and whether such transaction.

Specific types of transactions are excluded from the Related Person Transaction Policy, such as, for example, transactions in which the related person’s interest arises solely from his or her service as a director of, or direct or indirect ownership of less than a ten percent (10%) equity interest in, another entity that is a party to the transaction.

In addition to the Related Person Transaction Policy, the Code of Conduct requires that conflicts of interests involving persons other than directors, director nominees and executive officers must be approved by the Operations Committee.

The following is a discussion of transactions since January 1, 2020 between the Company and its executive officers, directors and stockholders owning 5% or more of the Common Stock:

Series C Preferred Stock Offerings

In March 2021, the Company entered into a Series C Preferred Stock Purchase Agreement with each of (i) the York Series C Purchasers and (ii) the Bardin Hill Series C Purchasers (together with the York Series C Purchasers, the “Series C Fund Purchasers”) pursuant to which the Company sold an aggregate of 14,500 shares of Series C Preferred Stock at $1,000.00 per share for an aggregate purchase price of $14.5 million, issued the Series C Warrants and issued an additional 290 shares of Series C Preferred Stock in aggregate as origination fees to the Series C Fund Purchasers.

The terms of the Series C Warrants are set forth in Warrant Agreements delivered to each of the Series C Fund Purchasers.

Under such Warrant Agreements, the Series C Warrants issued to the Series C Fund Purchasers represent the right to acquire a number of shares of Common Stock equal to approximately 41 basis points (0.41%) in the aggregate of the fully diluted shares of all outstanding shares of Common Stock on the exercise date with a strike price of $0.01 per share.

The Series C Warrants have a fixed three-year term commencing on the closing date of the Series C Preferred Stock Offering.

The Series C Warrants may only be exercised by holders at the expiration of such three-year term;

however, the Company can force exercise of the Series C 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 then applicable conversion price of the Series A Preferred Stock and the Series B Preferred Stock and the Company simultaneously elects to force a mandatory exercise of all other warrants then-outstanding and unexercised and held by any holder of parity stock.

In connection with the closing of the Series C Preferred Stock Offering, the Company and the Series C Fund Purchasers entered into registration rights agreements (the “Series C Preferred Stock Registration Rights Agreements”).

Pursuant to the Series C Preferred Stock Registration Rights Agreements, the Company agreed to, among other things, file with the SEC a shelf registration statement to permit the public resale of shares of Common Stock underlying (i) the Series C Preferred Stock (including any Common Stock underlying the Series C Preferred Stock issued as payment-in-kind dividends) issued pursuant to the Series C Preferred Stock Purchase Agreements and (ii) the Series C Warrants (the securities described in clauses (i) and (ii), the “Series C Registrable Securities”).

Further, the Company agreed to keep such shelf registration statement effective until the earlier of (i) the date all such Series C Registrable Securities ceased to be Series C Registrable Securities and (ii) the date all such Series C Registrable Securities covered by such shelf registration statement can be sold publicly without restriction or limitation under Rule 144 of the Securities Act, and without the requirement to be in compliance with Rule 144(c)(1) under the Securities Act. 

Independence of Directors

The Company adheres to the Nasdaq listing rules in determining whether a director is independent.

The Board consults with its counsel to ensure that the Board’s determinations are consistent with such rules and all relevant securities and other laws and regulations regarding the independence of directors.

The Nasdaq listing rules define an “independent director”

as a person, other than an executive officer of a company or any other individual having a relationship which, in the opinion of the company’s board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

Item 14.

P RINCIPAL A CCOUNTING F EES AND S ERVICES

Grant Thornton was the Company’s independent registered public accounting firm for the years ended December 31, 2021 and 2020.

The following table presents fees for professional audit services rendered by Grant Thornton for the audit of the Company’s annual financial statements for the year ended December 31, 2021 and 2020:

Year Ended December 31,

Audit fees (1)

Audit-related fees

Consist of fees billed for professional services rendered for audits of the Company’s consolidated financial statements, for the review of the interim condensed consolidated financial statements included in quarterly reports, services that are normally provided in connection with statutory and regulatory filings or engagements and attest services, except those not required by statute or regulation.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors

The Audit Committee is responsible for the appointment, retention, termination, compensation and oversight of the independent auditors.

The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent auditors.

Requests for approval are generally submitted at a meeting of the Audit Committee.

The Audit Committee may delegate pre-approval authority to a committee member, provided that any decisions made by such member shall be presented to the full committee at its next scheduled meeting.

The Audit Committee pre-approved all audit services provided by Grant Thornton during 2021 pursuant to this policy.

Item 15.

9 unchanged sentences

Notes to Consolidated Financial Statements

Supplemental Information to Consolidated Financial Statements –

Summarized Quarterly Financial Data

Financial Statement Schedules:

12 unchanged sentences

Amendment No.

1 to the Amended and Restated Bylaws of NextDecade Corporation

1 to the Amended and Restated Bylaws of NextDecade Corporation, dated March 3, 2021

Specimen Common Share Certificate

12 unchanged sentences

10.3 (20)†

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

Form of Registration Rights Agreement

Form of Restricted Stock Award Agreement

Form of Registration Rights Agreement for purchasers of Series A Preferred Stock

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

Form of Registration Rights Agreement.

Form of Purchaser Rights Agreement

Form of Registration Rights Agreement for purchasers of Series B Preferred Stock

Form of Purchaser Rights Agreement for purchasers of Series B Preferred Stock

Amendment No.

4 unchanged sentences

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

10.11 (28)†

Amendment No.

1 unchanged sentence

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.

4 unchanged sentences

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

10.18 (35)†

Director Compensation Policy

7 unchanged sentences

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.

10.27 (44)†

Amendment No.

2 to Employment Agreement, dated June 2, 2021, by and between NextDecade Corporation and Matthew K.

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.

1 unchanged sentence

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

Form of Registration Rights Agreement

Form of Registration Rights Agreement for purchasers of Series C Preferred Stock

10.32* †

Form of time-based restricted stock unit agreement

10.33* †

Form of performance-based restricted stock unit agreement

Subsidiaries of the Company

42 unchanged sentences

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.

4 unchanged sentences

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 10.25 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.

6 unchanged sentences

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 10.1 of the Company's Quarterly Report on Form 10-Q, filed August 2, 2021.

Incorporated by reference to Exhibit 10.35 of the Company's Annual Report on Form 10-K filed March 25, 2021.

Incorporated by reference to Exhibit 10.36 of the Company's Annual Report on Form 10-K filed March 25, 2021.

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.

21 unchanged sentences

/s/ Eric Garcia

Vice President and Chief Accounting Officer

Senior Vice President and Chief Accounting Officer

March 28, 2022

(Principal Accounting Officer)

/s/ Khalifa Abdulla Al Romaithi

March 28, 2022

Khalifa Abdulla Al Romaithi

/s/ Brian Belke

3 unchanged sentences

Frank Chapman

/s/ Taewon Jun

/s/ Seokwon Ha

March 28, 2022

2 unchanged sentences

Avinash Kripalani

/s/ Khalifa Abdulla Al Romaithi

March 25, 2021

Khalifa Abdulla Al Romaithi

/s/ Thanasi Skafidas

/s/ Edward Andrew Scoggins, Jr.

March 28, 2022

Thanasi Skafidas

Edward Andrew Scoggins, Jr.

/s/ William Vrattos

5 unchanged sentences

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