What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-03-11 compared with 2023-03-10 · 440 added, 763 removed, 230 unchanged (84% of the section changed)

5 unchanged sentences

Consolidated Statements of Operations

Consolidated Statements of Stockholders’

Equity and Convertible Preferred Stock

Consolidated Statements of Stockholders’ Equity and Convertible Preferred Stock

Consolidated Statements of Cash Flows

4 unchanged sentences

Opinion on the financial statements

We have audited the accompanying consolidated balance sheets of NextDecade Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2022 and 2021, the related consolidated statements of operations, stockholders’

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

We have audited the accompanying consolidated balance sheets of NextDecade Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations, stockholders’ 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, 2023 and 2022, 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.

The accompanying financial statements have been prepared assuming 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.

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

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

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

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

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

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

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

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

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

Accordingly, we express no such opinion.

7 unchanged sentences

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 9 to the consolidated financial statements, the Company had $4 million of common stock warrant liabilities as of December 31, 2022.

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.

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

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

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

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

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

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

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

Risk-free interest rate

Warrant terms

Consolidation of Rio Grande LNG Intermediate Holdings, LLC under the variable interest entity model

As described further in note 2 to the financial statements, when the Company has a variable interest in another legal entity, management evaluates whether that legal entity is within the scope of the variable interest entity ("VIE") model and, if so, whether the Company is the primary beneficiary of the VIE.

Management consolidates a VIE if the Company's involvement indicates that it is the primary beneficiary.

The Company is the primary beneficiary of a VIE if it has both (i) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE.

We identified the consolidation of Rio Grande LNG Intermediate Holdings, LLC under the VIE model (“consolidation under the VIE model”) as a critical audit matter.

The principal considerations for our determination are (i) the significant judgment by management when determining whether the Company is the primary beneficiary of the VIE based on whether the Company has the power to direct the activities of the VIE that most significantly impact the VIE's economic performance, and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE and (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures when evaluating audit evidence related to the purpose of the VIE, rights and obligations of the variable interest holders, mechanisms for the resolution of disputes among variable interest holders, and other executed agreements with the legal entity and its variable interest holders.

Our audit procedures related to the consolidation under the VIE model included the following, among others:

• We compared the rights of each party to underlying executed legal documents and discussed with management the purpose and design of the VIE.

• We evaluated management's analysis of significant activities of the VIE such as capital decisions, financing decisions and operating decisions, and which variable interest holder has the power to direct such activities.

In our evaluation, we considered the purpose and design of the entity, the composition of the board of directors and other legal rights of the parties, including the significance of the decision-making rights of each party in assessing which party has power to direct the activities that most significantly affect the economic performance of the VIE, as well as the substance of the arrangements.

• We tested the initial determination of non-controlling interests in Rio Grande LNG Intermediate Holdings, LLC, and the allocation of subsequent profits and losses in Rio Grande LNG Intermediate Holdings, LLC for controlling and non-controlling interest holders based on what the holders of these interests may legally claim at the end of each reporting period.

/s/ GRANT THORNTON LLP

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

Houston, Texas

March 11, 2024

NextDecade Corporation and Subsidiaries

NextDecade Corporation

Consolidated Balance Sheets

(in thousands, except share data)

(in thousands, except per share data)

Current assets:

Cash and cash equivalents $ 38,241 $ 62,789

$ 62,789  

$ 25,552  

Restricted cash 256,237 —

Derivative asset 17,958 —

Prepaid expenses and other current assets 2,089 1,149

Total current assets 314,525 63,938

63,938  

26,387  

Property, plant and equipment, net 2,437,733 218,646

218,646  

173,816  

Operating lease right-of-use assets, net

Operating lease right-of-use assets 170,827 1,474

Debt issuance costs 389,695 —

Other non-current assets 11,021 28,372

28,372  

21,312  

$ 312,430  

$ 222,105  

Liabilities, Convertible Preferred Stock and Stockholders’

Total assets $ 3,323,801 $ 312,430

Liabilities, Convertible Preferred Stock and Stockholders’ Equity

Current liabilities:

Accounts payable $ 243,129 $ 1,084

$ 1,084  

Accrued liabilities and other current liabilities

23,184  

Current Common Stock Warrant liabilities

Current operating lease liabilities

Accrued and other current liabilities 299,264 23,184

Common stock warrant liabilities 6,851 —

Operating lease liabilities 3,143 1,093

Total current liabilities 552,387 25,361

25,361  

Non-current Common Stock Warrant liabilities

Non-current operating lease liabilities

Common stock warrant liabilities 1,818 6,790

Operating lease liabilities 145,962 465

Derivative liability 66,899 —

Debt, net 1,816,301 —

Other non-current liabilities — 23,000

23,000  

Total liabilities 2,583,367 55,616

55,616  

33,813  

Commitments and contingencies (Note 16)

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

82,948 shares and 73,713 shares at December 31, 2022 and 2021, respectively

73,026  

63,791  

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

79,239 shares and 70,433 shares at December 31, 2022 and 2021, respectively

73,408  

64,602  

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

59,366 shares and 42,490 shares at December 31, 2022 and 2021, respectively

56,009  

40,007  

Stockholders’

Common stock, $ 0.0001 par value Authorized:

480.0 million shares at December 31, 2022 and 2021, Issued and outstanding:

143.5 million shares and 120.8 million shares at December 31, 2022 and 2021, respectively

Series A-C convertible preferred stock (Note 10) — 202,443

Stockholders’ equity:

Common stock, $ 0.0001 par value, 480.0 million authorized:

256.5 million and 143.5 million outstanding, respectively

Treasury stock:

991,089 shares and 346,126 shares at December 31, 2022 and 2021, respectively, at cost

( 4,587 )  

Preferred stock, $ 0.0001 par value Authorized:

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

none at December 31, 2022 and 2021

2.2 million and 1.0 million respectively, at cost

( 14,214 ) ( 4,587 )

Preferred stock, $ 0.0001 par value, 0.5 million authorized after designation of the convertible preferred stock:

none outstanding

Additional paid-in-capital 693,883 289,084

289,084  

191,264  

Accumulated deficit ( 391,772 ) ( 230,140 )

( 230,140 )  

Total stockholders’

54,371  

19,892  

Total liabilities, Convertible Preferred Stock and stockholders’

$ 312,430  

$ 222,105  

Total stockholders' equity 287,923 54,371

Non-controlling interest 452,511 —

Total equity 740,434 54,371

Total liabilities, convertible preferred stock and stockholders’ equity $ 3,323,801 $ 312,430

The accompanying notes are an integral part of these consolidated financial statements.

NextDecade Corporation and Subsidiaries

Consolidated Statements of Operations 

NextDecade Corporation

Consolidated Statements of Operations

(in thousands, except per share data)

Year Ended December 31,

Revenues $ — $ —

Operating expenses:

General and administrative expenses

General and administrative expense 111,468 49,093

Development expense, net 4,891 4,101

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Loss on common stock warrant liabilities ( 1,879 ) ( 5,747 )

Derivative loss, net ( 44,803 ) —

Interest expense, net of capitalized interest ( 50,285 ) —

Loss on debt extinguishment ( 9,531 ) —

Other income, net 7,526 151

Total other expense ( 98,972 ) ( 5,596 )

Net loss attributable to NextDecade Corporation ( 221,640 ) ( 60,071 )

net loss attributable to non-controlling interest ( 59,379 ) —

preferred stock dividends 20,484 24,282

Deemed dividends on Series A Convertible Preferred Stock

Net loss attributable to common stockholders $ ( 182,745 ) $ ( 84,353 )

Net loss per common share - basic and diluted

Weighted average shares outstanding - basic and diluted

Net loss per common share - basic & diluted $ ( 0.94 ) $ ( 0.65 )

Weighted average shares outstanding - basic & diluted 194,595 130,136

The accompanying notes are an integral part of these consolidated financial statements.

NextDecade Corporation and Subsidiaries

Consolidated Statements of Stockholders’

Equity and Convertible Preferred Stock

NextDecade Corporation

Consolidated Statement of Stockholders’ Equity and Convertible Preferred Stock

(in thousands)

Year Ended December 31,

Total stockholders' equity, beginning balances $ 54,371 $ 19,892

Common stock:

Beginning balances 14 12

Issuance of common stock 6 2

Preferred stock conversion 6 —

Ending balances 26 14

Treasury Stock:

Stockholders’

Preferred Stock

Balance at January 1, 2021

Share-based compensation

Restricted stock vesting

Beginning balance ( 4,587 ) ( 1,315 )

Shares repurchased related to share-based compensation ( 9,627 ) ( 3,272 )

Issuance of common stock, net

Stock dividend

Exercise of common stock warrants

Issuance of Series C Convertible Preferred Stock

Preferred stock dividends

Deemed dividends - accretion of beneficial conversion feature

Balance at December 31, 2021

Ending balance ( 14,214 ) ( 4,587 )

Additional paid-in-capital:

Beginning balances 289,084 191,264

Share-based compensation 26,600 7,472

Restricted stock vesting

Shares repurchased related to share-based compensation

Issuance of common stock, net 254,394 111,066

Sale of equity in subsidiary ( 78,579 ) —

Exercise of common stock warrants — 3,564

Issuance of Series C Convertible Preferred Stock

Preferred stock dividends ( 20,484 ) ( 24,282 )

Balance at December 31, 2022

Preferred stock conversion 222,868 —

Ending balances 693,883 289,084

Accumulated deficit:

Beginning balances ( 230,140 ) ( 170,069 )

Subsidiary deconsolidation due to sale 629 —

Net loss ( 162,261 ) ( 60,071 )

Ending balances ( 391,772 ) ( 230,140 )

Total stockholders' equity 287,923 54,371

Non-controlling interest:

Beginning balance — —

Sale of equity in subsidiary 511,890 —

Net loss ( 59,379 ) —

Ending balance 452,511 —

Total equity, ending balances $ 740,434 $ 54,371

Preferred Stock, Series A-C:

Beginning balance $ 202,443 $ 168,400

Preferred stock dividends 20,431 24,207

Preferred stock conversion ( 222,874 ) —

Issuance of preferred stock — 9,836

Ending balance $ — $ 202,443

The accompanying notes are an integral part of these consolidated financial statements.

NextDecade Corporation and Subsidiaries

NextDecade Corporation

Consolidated Statements of Cash Flows

(in thousands)

Year Ended December 31,

Operating activities:

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

Share-based compensation expense (forfeiture)

Depreciation 168 162

Share-based compensation expense 26,553 7,472

Loss on common stock warrant liabilities 1,879 5,747

Derivative loss, net 44,803 —

Net cash provided by settlement of derivative instruments 4,138 —

Amortization of right-of-use assets 2,980 756

Gain on sale of assets ( 5,712 ) —

Amortization of debt issuance costs 41,390 —

Loss on debt extinguishment 9,531 —

Interest expense 26,432 —

Amortization of other non-current assets — 354

Changes in operating assets and liabilities:

Prepaid expenses

Prepaid expenses and other current assets ( 940 ) ( 314 )

Accounts payable 4,057 684

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Financing activities:

Proceeds from sale of Series C Convertible Preferred Stock

Proceeds from debt issuance 2,083,000 —

Proceeds from sale of equity in subsidiaries 457,659 —

Proceeds from sale of preferred stock — 10,500

Proceeds from sale of common stock 254,400 115,000

Equity issuance costs

Repayment of debt ( 233,000 ) —

Debt and equity issuance costs ( 494,270 ) ( 3,952 )

Preferred stock dividends ( 53 ) ( 75 )

1 unchanged sentence

Net cash provided by financing activities 2,058,109 118,201

Net increase in cash and cash equivalents

Cash and cash equivalents –

beginning of period

Cash and cash equivalents –

end of period

Non-cash investing activities:

Accounts payable for acquisition of property, plant and equipment

Accrued liabilities for acquisition of property, plant and equipment

Accrued liabilities for acquisition of other non-current assets

Pipeline assets obtained in exchange for other non-current liabilities

Non-cash financing activities:

Paid-in-kind dividends on Convertible Preferred Stock

Accretion of deemed dividends on Series A Convertible Preferred Stock

Accrued liabilities for equity issuance costs

Net increase in cash, cash equivalents and restricted cash 231,689 37,237

Cash, cash equivalents and restricted cash – beginning of period 62,789 25,552

Cash, cash equivalents and restricted cash – end of period $ 294,478 $ 62,789

Balance per Consolidated Balance Sheet:

December 31, 2023

Cash and cash equivalents $ 38,241

Restricted cash 256,237

Total cash, cash equivalents and restricted cash $ 294,478

The accompanying notes are an integral part of these consolidated financial statements.

NextDecade Corporation and Subsidiaries

Notes to Consolidated Financial Statements

1  —

Background and Basis of Presentation

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

NextDecade Corporation

Notes to Consolidated Financial Statements

Note 1 — Background and Basis of Presentation

NextDecade Corporation (“we” or the “Company”) is primarily engaged in construction and development activities related to the liquefaction of natural gas and sale of liquefied natural gas (“LNG”) and the capture and storage of CO 2 emissions.

We are constructing and developing a natural gas liquefaction and export facility located in the Rio Grande Valley in Brownsville, Texas (the “Rio Grande LNG Facility”), which currently has three liquefaction trains and related infrastructure under construction (“Phase 1”).

Construction commenced on Phase 1 of the Rio Grande LNG Facility in July 2023, following a positive final investment decision (“FID”) and the closing of project financing by our subsidiary, Rio Grande LNG, LLC (“Rio Grande”).

The Rio Grande LNG Facility has received Federal Energy Regulatory Commission approval and Department of Energy FTA and non-FTA authorizations for the construction of up to five liquefaction trains and LNG exports totaling 27 million tonnes per annum (“MTPA”).

We are also developing liquefaction trains 4 and 5 at the Rio Grande LNG Facility, a planned carbon capture and storage (“CCS”) project at the Rio Grande LNG Facility, and other potential CCS projects that would be located at third-party industrial source facilities.

Basis of Presentation

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

All intercompany accounts and transactions have been eliminated in consolidation.

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

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

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, 2022 , the Company had $ 62.8  million in cash and cash equivalents, which may not be sufficient to fund the Company's planned operations through one year after the date the consolidated financial statements are issued.

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

The reclassifications did not have a material effect on the Company's financial position, results of operations or cash flows.

The Company has incurred operating losses since its inception and management expects operating losses and negative cash flows to continue until the commencement of operations at the Rio Grande LNG Facility and, as a result, the Company will require additional capital to fund its operations and execute its business plan.

As of December 31, 2023, the Company had $ 38.2 million in cash and cash equivalents, which may not be sufficient to fund the Company's planned operations and development activities for future phases of the Rio Grande LNG Facility and CCS projects 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.

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 by managing certain operating and overhead costs.

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 —

Summary of Significant Accounting Policies

Note 2 — Summary of Significant Accounting Policies

Variable Interest Entities (“VIEs”)

The Company makes a determination at the inception of each arrangement whether an entity in which the Company has made an investment, sold equity in a subsidiary or in which it has other variable interests is considered a VIE.

Generally, an entity is a VIE if either (1) the entity does not have sufficient equity at risk to finance its activities without additional subordinated financial support from other parties, (2) the entity's investors lack any characteristics of a controlling financial interest or (3) the entity was established with non-substantive voting rights.

The Company consolidates VIEs when it is deemed to be the primary beneficiary.

The primary beneficiary of a VIE is generally the party that has the power to make decisions that most significantly affect the economic performance of the VIE and has the obligation to absorb losses or the right to receive benefits that in either case, could be potentially significant to the VIE.

If the Company is not deemed to be the primary beneficiary of a VIE, the Company accounts for the investment or other variable interests in a VIE in accordance with other applicable GAAP.

NextDecade Corporation

Notes to Consolidated Financial Statements

Non-controlling interests

When the Company consolidates an entity, 100% of the assets, liabilities, revenues and expenses of the entity are included in the Company's Consolidated Financial Statements.

For those consolidated entities in which the Company owns less than 100%, the Company records a non-controlling interest as a component of equity in the Consolidated Balance Sheets, which represent the third party ownership in the net assets of the respective consolidated subsidiary.

Additionally, the portion of the net income or loss attributable to the non-controlling interest is reported as net loss attributable to non-controlling interest on the Consolidated Statements of Operations.

Changes in the Company's ownership interests in an entity that do not result in deconsolidation are generally recognized within equity.

Use of Estimates

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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.

Restricted Cash

Restricted cash consists of funds that are contractually or legally restricted to usage or withdrawal and have been presented separately from cash and cash equivalents on our Consolidated Balance Sheets.

Property, Plant and Equipment

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• regulatory approval is probable;

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

• construction financing is expected to be available at the time of a FID;

• prospective customers have been identified and the FID is probable;

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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.

NextDecade Corporation

Notes to Consolidated Financial Statements

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.

Derivative Instruments

The Company uses derivative instruments to hedge its exposure to cash flow variability from interest rate risk.

Derivative instruments are recorded at fair value and included in the Consolidated Balance Sheets as current or non-current assets or liabilities depending on the derivative position and the expected timing of settlement.

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

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

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

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

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

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 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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Equity classified warrants are accounted for at fair value on the issuance date with no changes in fair value recognized after the issuance date.

Our debt consists of long-term secured debt securities and credit agreements with banks and other lenders.

Debt issuances are placed directly by us or through securities dealers, underwriters, or lead arrangers and are held by institutional investors, banks and other lenders.

Debt is recorded on our Consolidated Balance Sheets at outstanding principal value, net of unamortized debt issuance costs related to term notes and loans.

Debt issuance costs consist primarily of arrangement fees, professional fees, legal fees and in certain cases, commitment fees.

If debt issuance costs are incurred in connection with a line of credit arrangement or on undrawn funds, the debt issuance costs are presented as an asset on our Consolidated Balance Sheets.

Discounts, premiums and debt issuance costs directly related to the issuance of debt are amortized over the life of the debt and are recorded in interest expense, net of capitalized interest using the effective interest method.

NextDecade Corporation

Notes to Consolidated Financial Statements

We classify debt as current or non-current on our Consolidated Balance Sheets based on contractual maturity;

however, long-term debt extinguished after the balance sheet date but before the financial statements are issued would be classified based on facts and circumstances existing as of the balance sheet date.

Fair Value of Financial Instruments

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

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

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

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

Preferred Stock and Common Stock Warrants .

Recurring fair-value measurements are performed for derivatives and common stock warrant liabilities as disclosed in Note 5 — Derivatives and Note 10 — Preferred Stock and Common Stock Warrants, respectively.

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

4 unchanged sentences

Net Earnings (Loss) Per Share

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

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

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

1 unchanged sentence

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

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

Net Loss Per Share Attributable to Common Stockholders .

Basic and diluted EPS for all periods presented are the same since the effect of our potentially dilutive securities are anti-dilutive to our net loss per share, as disclosed in Note 13 — Net Loss Per Share.

Share-based Compensation

2 unchanged sentences

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

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

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

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

2 unchanged sentences

We account for forfeitures as they occur.

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

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

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

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

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

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

NextDecade Corporation

Notes to Consolidated Financial Statements

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, 2022 and 2021 , the Company operated as a single operating segment.

As such, for purposes of financial reporting under GAAP during the years ended December 31, 2023 and 2022, the Company operated as a single operating segment.

Smaller Reporting Company

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

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

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

Note 3 —

Prepaid Expenses and Other Current Assets

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

Prepaid subscriptions

Prepaid insurance

Prepaid marketing and sponsorships

Total prepaid expenses and other current assets

$ 1,149  

Note 4  —

Sale of Equity Interests in Rio Bravo Pipeline Company, LLC

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

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

Buyer paid $ 15.0 million of the purchase price to NextDecade LLC at the Closing and the remainder will be paid within five business days after the date that Rio Grande has received, after a 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”).

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

The Valley Crossing Pipeline is owned and operated by VCP.

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

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

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

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

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

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

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

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

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

Accordingly, the proceeds from the sale of the Equity Interests and additional costs incurred by Buyer are presented as a non-current liability and the assets of Rio Bravo have not been de-recognized in the consolidated balance sheet at December 31, 2022 .

Note 5  —

Property, Plant and Equipment

Under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company qualifies as a “smaller reporting company” because it had less than $100.0 million in revenue during the year ended December 31, 2023 and the value of its common stock held by non-affiliates as of the end of its most recently completed second fiscal quarter was less than $700.0 million.

Note 3 — Sale of Equity Interests in Rio Bravo

In March 2020 the Company sold its’ equity interests in Rio Bravo Pipeline Company, LLC (“Rio Bravo”) to a third party for approximately $ 19.4 million.

Under the terms of the agreement, if the Company or its affiliate failed to issue a full notice to proceed to its’ EPC contractor prior to December 31, 2024, the purchaser had the right to sell the equity interests back to the Company and the Company had the right to repurchase the equity interests from Buyer.

Of the transaction price of approximately $ 19.4 million, $ 15.0 million was received by the Company in March 2020 and the remaining approximate $ 4.4 million was received in July 2023 upon Rio Grande’s issuance of the full notice to proceed to its’ EPC contractor.

Accordingly, the assets of Rio Bravo have been de-recognized in the consolidated balance sheet as of December 31, 2023.

Note 4 — Property, Plant and Equipment

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

Furniture, fixtures, and equipment

Leasehold improvements

Total fixed assets

Rio Grande LNG Facility (not placed in service) $ 2,431,389 $ 197,144

Rio Bravo pipeline (not placed in service) — 21,017

Corporate and other 7,518 1,491

Total property, plant and equipment, at cost 2,438,907 219,652

accumulated depreciation ( 1,174 ) ( 1,006 )

( 1,006 )  

Total fixed assets, net

Terminal and Pipeline Assets (not placed in service)

197,144  

152,445  

21,017  

Total Terminal and Pipeline assets

218,161  

173,462  

Total property, plant and equipment, net $ 2,437,733 $ 218,646

$ 218,646  

$ 173,816  

Depreciation expense for the years ended 

December 31, 2022 and 2021 was $ 162 thousand and $ 184  thousand, respectively.

Note 6  —

We currently lease approximately 33,800 square feet of office space for general and administrative purposes in Houston, Texas under a lease agreement that expires on December 31, 2023. 

We also lease approximately 2,500 square feet of office space for marketing purposes in Singapore under a lease agreement that expires on October 31, 2025. 

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

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

Rio Grande has the option to renew and extend the term of the Rio Grande Site Lease beyond the Primary Term for up to two consecutive renewal periods of ten years each provided that Rio Grande has not caused an event of default under the Rio Grande Site Lease. Under the Rio Grande Site Lease, the Effective Date Notice was to be delivered no later than November 6, 2019 ( the “Outside Effective Date”) unless Rio Grande was unable to deliver the Effective Date Notice prior to the Outside Effective Date due to reasons unrelated to its own acts or omissions or its inability to secure one or more of the required permits for the Terminal.

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

April 20, 2022 ,  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, 2023  ( 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, 2024 

by providing the BND with written notice of its election 

no  later than the close of business on the Effective Date.

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

December 31,  

Office leases

$ 1,474  

Total operating lease right-of-use assets, net

$ 1,474  

Operating lease liabilities are as follows (in thousands):

December 31,  

Office leases

$ 1,093  

Total current lease liabilities

Non-current office leases

Total lease liabilities

$ 1,558  

Operating lease expense is as follows (in thousands):

December 31,  

Office leases

Total operating lease expense

Short-term lease expense

Total lease expense

$ 1,119  

Maturity of operating lease liabilities as of 

December 31, 2022 are as follows (in thousands):

$ 1,300  

Note 5 — Derivatives

In July 2023, Rio Grande entered into interest rate swaps agreements (the “Swaps”) to protect against interest rate volatility by hedging a portion of the floating-rate interest payments associated with the credit facilities described in Note 9 — Debt .

As of December 31, 2023, Rio Grande has the following Swaps outstanding (in thousands):

Initial Notional Amount Maximum Notional Amount Maturity Weighted Average Fixed Interest Rate Paid Variable Interest Rate Received

$ 123,000 $ 8,500,000 July 12, 2030 3.4 % USD - SOFR

The Swaps are not designated as cash flow hedging instruments, and changes in fair value are recorded within our Consolidated Statements of Operations.

The Company values the Swaps using an income-based approach based on observable inputs to the valuation model including interest rate curves, risk adjusted discount rates, credit spreads and other relevant data.

The fair value of the Swaps is approximately $ 48.9 million as of December 31, 2023, and is classified as Level 2 in the fair value hierarchy.

NextDecade Corporation

Notes to Consolidated Financial Statements

Note 6 — Leases

The Company commenced the Rio Grande LNG Facility site lease on July 12, 2023 and it has an initial term of 30 years.

The Company has the option to renew and extend the term of the lease for up to two consecutive renewal periods of ten years each, but as the Company is not reasonably certain that those options will be exercised, none are recognized as part of our right of use assets and lease liabilities.

The Company has also entered into an office space lease which expires on December 31, 2035, and does not include any options for renewal.

For the years ended December 31, 2023 and 2022, our operating lease costs were $ 6.1 million and $ 1.1 million, respectively.

Maturity of operating lease liabilities as of December 31, 2023 are as follows (in thousands, except lease term and discount rate):

Thereafter 199,241

Total undiscounted lease payments 243,581

1 unchanged sentence

Present value of lease liabilities $ 149,105

$ 1,558  

Other information related to our operating leases as of 

December 31, 2022 is as follows (in thousands):

December 31,  

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

Cash flows from operating activities

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

In exchange for new operating lease liabilities during the period

Note 7  —

Other Non-Current Assets

Weighted average remaining lease term - years 27.9

Weighted average discount rate - percent 4.0

Other information related to our operating leases is as follows (in thousands):

Year Ended December 31,

Operating cash flows for amounts paid included in the measurement of operating lease liabilities $ 3,122 $ 678

Noncash right-of-use assets recorded for new operating lease liabilities during the period 147,727 1,640

Note 7 — Other Non-Current Assets

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

December 31,  

Contributions in aid of construction (1)

Permitting costs (2)

$ 8,575  

$ 7,609  

Enterprise resource planning system, net

Rio Grande Site Lease initial direct costs (3)

19,612  

13,314  

Deposits and other 3,487 185

Total other non-current assets, net

$ 28,372  

$ 21,312  

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

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

Note 8  —

Accrued Liabilities and Other Current Liabilities

Total other non-current assets $ 11,021 $ 28,372

(1) Contributions in aid of construction relate to amounts paid to third parties to begin construction of utilities required for the Rio Grande LNG Facility.

(2) Permitting costs were reclassified to property, plant and equipment in July 2023 with the positive final investment decision on Phase 1 of the Rio Grande LNG Facility.

(3) Rio Grande Site Lease initial direct costs were reclassified to operating lease right-of-use asset in July 2023 upon commencement of the Rio Grande site lease.

NextDecade Corporation

Notes to Consolidated Financial Statements

Note 8 — Accrued and Other Current Liabilities

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

Rio Grande LNG Facility costs $ 268,821 $ 12,046

Accrued interest 20,392 —

Employee compensation expense 9,270 6,650

$ 6,650  

$ 4,358  

Terminal asset costs

12,046  

Permitting costs

Accrued legal services

Share-based compensation liability

Other accrued liabilities 781 4,488

Total accrued liabilities and other current liabilities

$ 23,184  

$ 5,973  

9  —

Preferred Stock and Common Stock Warrants

Total accrued and other current liabilities $ 299,264 $ 23,184

Note 9 — Debt

Debt consisted of the following (in thousands):

December 31, 2023

Senior Secured Notes and Loans:

6.67 % Senior Secured Notes due 2033

6.72 % Senior Secured Loans due 2033

7.11 % Senior Secured Loans due 2047

Total Senior Secured Notes and Loans 1,307,000

Credit Facilities:

CD Credit Facility 484,000

TCF Credit Facility 59,000

Total debt 1,850,000

Unamortized debt issuance costs ( 33,699 )

Total non-current debt, net of unamortized debt issuance costs $ 1,816,301

Senior Secured Notes and Loans

The 6.67 % Senior Secured Notes (the “Senior Secured Notes”), 6.72 % Senior Secured Loans (the “ 6.72 % Senior Secured Loans”) and 7.11 % Senior Secured Loans (the “ 7.11 % Senior Secured Loans” and, together with the 6.72 % Senior Secured Loans, the “Senior Secured Loans”) are senior secured obligations of Rio Grande, ranking senior in right of payment to any and all of Rio Grande’s future indebtedness that is subordinated to the Senior Secured Notes and the Senior Secured Loans, and equal in right of payment with Rio Grande’s other existing and future indebtedness that is senior and secured by the same collateral securing the Senior Secured Notes and Senior Secured Loans.

The Senior Secured Notes and Senior Secured Loans are secured on a first-priority basis by a security interest in all of the membership interests in Rio Grande and substantially all of Rio Grande’s assets, pari passu with the CD Credit Agreement and the loans made under the TCF Credit Facility.

Debt Maturities

Years Ending December 31, Principal Payments

2024 - 2028 $ —

Thereafter 1,850,000

Total $ 1,850,000

NextDecade Corporation

Notes to Consolidated Financial Statements

Credit Facilities

Below is a summary of our committed credit facilities as of December 31, 2023 (in thousands):

CD Senior Working Capital Facility (1)

CD Credit Facility (1)

TCF Credit Facility (2)

Total facility size $ 500,000 $ 9,730,000 $ 800,000

Outstanding balance — 484,000 59,000

Letters of credit issued 47,662 — —

Available commitment $ 452,338 $ 9,246,000 $ 741,000

Priority ranking Senior secured Senior secured Senior secured

Interest rate on outstanding balance SOFR plus margin of 2.25 %

SOFR plus margin of 2.25 %

Commitment fees on undrawn balance 0.68 % 0.68 % 0.68 %

Maturity date July 12, 2030 July 12, 2030 July 12, 2030

(1) The obligations of Rio Grande under the CD Senior Working Capital Facility and CD Credit Facility are secured by substantially all of the assets of Rio Grande as well as a pledge of all of the membership interests in Rio Grande on a first-priority basis, pari passu with the Senior Secured Notes, the Senior Secured Loans and the loans made under the TCF Credit Facility.

(2) The obligations of Rio Grande under the TCF Credit Agreement are secured by substantially all of the assets of Rio Grande as well as a pledge of all of the membership interests in Rio Grande on a first-priority basis, pari passu with the Senior Secured Notes, the Senior Secured Loans and the loans made under the CD Credit Agreement.

Total Energies Holdings SAS (“Total Holdings”) provides contingent credit support to the lenders under the TCF Credit Agreement to pay past due amounts owing from Rio Grande under the agreement upon demand.

Restrictive Debt Covenants

The CD Credit Facility and the TCF Credit Facility (collectively, the “Facilities”) include certain covenants and events of default that are supplemental to the covenants and events of default set forth in the P1 Common Terms Agreement and that are customary for project financing facilities of this type, including a requirement that interest rates for a minimum of 75 % of the projected principal amount of Senior Secured Debt outstanding be hedged or have fixed interest rates.

In addition, certain covenants and events of default in the Facilities are more restrictive than the corresponding covenants and events of default in the P1 Common Terms Agreement, including covenants limiting Rio Grande’s ability to incur additional indebtedness, make certain investments or pay dividends (which are subject to customary conditions set out in the Facilities and certain related financing documents) or distributions on equity interests or subordinated indebtedness or purchase, redeem, or retire equity interests, sell or transfer assets, incur liens, dissolve, liquidate, consolidate, merge, sell, or lease all or substantially all of Rio Grande’s assets or enter into certain LNG sales contracts.

The Facilities include a requirement for Rio Grande to maintain a historical debt service coverage ratio of at least 1.10 :1.00 at the end of each fiscal quarter starting from the initial principal payment date, a default of which may be cured with equity contributions.

The Senior Secured Notes and Senior Secured Loans contain customary terms and events of default and certain covenants that, among other things, limit Rio Grande’s ability to incur additional indebtedness, make certain investments or pay dividends or distributions on equity interests or subordinated indebtedness or purchase, redeem, or retire equity interests, sell or transfer assets, incur liens, dissolve, liquidate, consolidate, merge, or sell or lease all or substantially all of Rio Grande’s assets.

The Senior Secured Notes and Senior Secured Loans further require Rio Grande to submit certain reports and information and maintain certain LNG offtake agreements.

With respect to certain events, including a change of control event and receipt of certain proceeds from asset sales, events of loss or liquidated damages, the Senior Secured Notes and Senior Secured Loans require Rio Grande to make an offer to repurchase or offer to prepay, respectively, at 101 % (with respect to a change of control event) or par (with respect to each other event).

The Senior Secured Notes Senior and Secured Loans covenants are subject to a number of important limitations and exceptions, including the terms and covenants contained in the P1 Common Terms Agreement.

NextDecade Corporation

Notes to Consolidated Financial Statements

The Senior Secured Notes require Rio Grande to maintain a debt service coverage ratio of at least 1.10 :1.00 at the end of each fiscal quarter starting from the initial principal payment date.

The Senior Secured Loans require Rio Grande to maintain a debt service coverage ratio of at least 1.10 :1.00 at the end of each fiscal quarter starting from the first quarterly payment date to occur on or after the date that is ninety days following the project completion date.

As of December 31, 2023, Rio Grande was in compliance with all covenants related to its respective debt agreements.

Debt Extinguishment

On December 28, 2023, the Company repaid $ 233.0 million of the outstanding principal balance of the CD Credit Facility.

As a result of the repayment, the Company recognized an approximate $ 9.5 million loss on extinguishment for the year ended December 31, 2023.

Interest Expense

Total interest expense, net of capitalized interest, consisted of the following (in thousands):

Year Ended December 31,

Interest cost of non-current debt

Interest per contractual rate $ 43,268

Amortization of debt issuance costs 41,390

Total interest cost 84,658

Capitalized interest ( 34,373 )

Total interest expense, net of capitalized interest $ 50,285

Fair Value Disclosures

The following table shows the carrying amount and estimated fair value of our debt (in thousands):

December 31, 2023

Carrying Value Fair Value

Senior Secured Notes $ 700,000 $ 743,593

Senior Secured Loans 607,000 632,998

The fair value of the Company's Senior Secured Notes and Senior Secured Loans was calculated based on inputs that are observable in the market or that could be derived from, or corroborated with, observable market data, including interest rates on debt issued by parties with comparable credit ratings.

The fair value of the Company’s CD Credit Facility and TCF Credit Facility approximates its' carrying amount due to its variable interest rate, which approximates a market interest rate.

Note 10 — Preferred Stock and Common Stock Warrants

Preferred Stock

December 31, 2020 ,  the Company had outstanding 

65,507  shares of Series A Convertible Preferred Stock, par value $ 0.0001  per share (the “Series A Preferred Stock”) and 

62,612 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.

In 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.

In 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.

March 2022 ,  the Company sold an aggregate of 

10,500  shares of Series C Preferred Stock (the 

“2022  Series C Preferred Stock”), together with associated warrants to purchase Company common stock (the 

“2022  Series C Warrants”) at $ 1,000  per share for an aggregate purchase price of $ 10.5  million and issued an additional 

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

December 31, 2022 ,  the Company had outstanding 

82,948 shares of Series A Convertible Preferred Stock, par value $ 0.0001  per share (the “Series A Preferred Stock”), 

79,239 shares of Series B Convertible Preferred Stock, par value $ 0.0001  per share (the “Series B Preferred Stock”) and 59,366  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”).

Net proceeds from the sales of the 

2022  Series C Preferred Stock were allocated on a fair value basis to the 

2022  Series C Warrants and on a relative fair value basis to the 

2022  Series C Preferred Stock. 

The allocation of net cash proceeds is as follows (in thousands):

Allocation of Proceeds

2022 Series C

Gross proceeds

$ 10,500  

Equity issuance costs

( 20 )  

Net proceeds - Initial Fair Value Allocation

$ 10,480  

$ 9,836  

Per balance sheet upon issuance

$ 9,836  

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):

Allocation of Proceeds

2021 Series C

Gross proceeds

$ 39,500  

Equity issuance costs

Net proceeds - Initial Fair Value Allocation

$ 39,438  

$ 1,631  

$ 37,807  

Per balance sheet upon issuance

 $ 1,631  

 $ 37,807  

December 31, 2022 ,  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 $ 5.48  per share, $ 5.53  per share and $ 2.98  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 years ended December 31, 2022 and 2021  the Company paid-in-kind $ 24.3  million and $ 18.3  million of dividends, respectively, to holders of the Convertible Preferred Stock.

On January 12, 2023, the Company declared dividends to holders of the Convertible Preferred Stock as of the close of business on December 15, 2022.

On January 17, 2023, the Company paid-in-kind $ 6.7  million of dividends to holders of the Convertible Preferred Stock.

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

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

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

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 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.

As of December 31, 2022, the Company had outstanding 82,948 shares of Series A Convertible Preferred Stock, par value $ 0.0001 per share (the “Series A Preferred Stock”), 79,239 shares of Series B Convertible Preferred Stock, par value $ 0.0001 per share (the “Series B Preferred Stock”) and 59,366 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”).

The shares of Convertible Preferred Stock bore dividends at a rate of 12 % per annum, which were cumulative and accrued daily from the respective dates of issuance on the $ 1,000 stated value per share.

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

During the year ended December 31, 2023 and 2022, the Company paid-in-kind $ 20.5 million and $ 24.3 million of dividends, respectively, to the holders of the Convertible Preferred Stock.

On July 26, 2023, the Convertible Preferred Stock was converted into 59,542,066 shares of common stock.

NextDecade Corporation

Notes to Consolidated Financial Statements

Common Stock Warrants

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

As of December 31, 2022 and 2021 , the outstanding Common Stock Warrants represented the right to acquire in the aggregate a number of shares of Company common stock equal to approximately 71 basis points ( 0.71 %) and 86 basis points ( 0.86 %), 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.

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

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

The Company revalues the Common Stock Warrants at each balance sheet date and recognized a loss of $ 5.7 million and $ 2.5  million for the years ended 

December 31, 2022 and 2021 , 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, 2022  and 2020 are as follows:

$ 4.94  

$ 2.85  

The Company issued warrants exercisable to purchase Company common stock in connection with its issuances of Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock (collectively, the “Common Stock Warrants”).

The Company revalues the Common Stock Warrants at each balance sheet date and are included in Level 3 of the fair value hierarchy.

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

Stock price $ 4.77 $ 4.94

Exercise price $ 0.01 $ 0.01

$ 0.01  

Risk-free rate 4.7 % 4.6 %

52.5 %  

Note 10  —

Stockholders' Equity

Volatility 78.4 % 52.5 %

Term (years) 0.5 1.5

The following table shows a reconciliation of changes in the fair value of the Common Stock Warrants which are classified as Level 3 in the fair value hierarchy (in thousands):

Beginning balance $ 6,790 $ 3,963

Increase in fair value 1,879 5,747

Exercise — ( 3,564 )

Issuance — 644

Ending balance $ 8,669 $ 6,790

Note 11 — Variable Interest Entity

Intermediate Holdings and its wholly owned subsidiaries, including Rio Grande, have been formed to undertake Phase 1 of the construction and operation of the Rio Grande LNG Facility.

The Company is not obligated to fund losses of Intermediate Holdings, however, the Company's capital account, which would be considered in allocating the net assets of Intermediate Holdings were it to be liquidated, continues to share in losses of Intermediate Holdings.

Further, Rio Grande has granted the Company decision-making rights regarding the construction of Phase 1 of the Rio Grande LNG Facility and key aspects of its operation, which may only be terminated by equity holders for cause, via agreements with NextDecade LLC.

Due to the foregoing, the Company determined that it holds a variable interest in Rio Grande through Intermediate Holdings and is its primary beneficiary, and therefore consolidates Intermediate Holdings in these Consolidated Financial Statements.

The following table presents the summarized assets and liabilities (in thousands) of Intermediate Holdings, which are included in the Company's Consolidated Balance Sheets.

The assets in the table below may only be used to settle the obligations of Rio Grande.

In addition, there is no recourse to us for the consolidated VIE’s liabilities.

The assets and liabilities in the table below include assets and liabilities of Intermediate Holdings and its subsidiaries only and exclude intercompany balances between Intermediate Holdings and NextDecade, which are eliminated in the Consolidated Financial Statements of NextDecade.

NextDecade Corporation

Notes to Consolidated Financial Statements

Current assets

Cash $ 256,237 $ —

Current derivative asset 17,958 —

Prepaid expenses and other current assets 108 24

Total current assets 274,303 24

Property, plant and equipment, net 2,428,583 194,289

Operating lease right-of-use assets, net 157,053 —

Debt issuance costs, net of amortization 389,695 —

Non-current derivative assets — —

Other non-current assets 9,374 28,187

Total assets $ 3,259,008 $ 222,500

Current liabilities

Accounts payable $ 238,582 $ 108

Accrued liabilities and other current liabilities 288,779 15,457

Current operating lease liabilities 2,554 —

Total current liabilities 529,915 15,565

Non-current operating lease liabilities 131,901 —

Non-current derivative liability 66,899 —

Non-current debt, net of unamortized debt issuance costs 1,816,301 —

Total liabilities $ 2,545,016 $ 15,565

Note 12 — Stockholders' Equity

Common Stock Purchase Agreements

April 6, 2022 ,  the Company entered into a common stock purchase agreement (the “Stock Purchase Agreement”) with HGC NEXT INV LLC (the “Purchaser”), pursuant to which the Company sold 

4,618,226  shares of the Company's common stock to the Purchaser, at a purchase price of $ 6.496  per share for an aggregate purchase price of approximately $ 30  million. 

The consummation of the transactions contemplated by the Stock Purchase Agreement occurred on 

April 7, 2022 .

September 14, 2022 ,  the Company entered into a common stock purchase agreement for a private placement (the “Private Placement”) with several institutional investors (collectively, the “Purchasers”), pursuant to which the Company agreed to sell, and the Purchasers severally agreed to purchase, an aggregate of 

15,454,160  shares of the Company’s common stock at a purchase price of $ 5.50  per share for an aggregate purchase price of approximately $ 85.0  million. 

The Private Placement closed on 

September 19, 2022 .

Common Stock Warrants

During the year ended 

December 31, 2022 ,  Common Stock Warrants were exercised by certain holders of Series B Preferred Stock. 

In connection with the exercises of Common Stock Warrants, the Company issued an aggregate of approximately 0.5 million shares of Company common stock.

11  —

Net Loss Per Share Attributable to Common Stockholders

The following table (in thousands, except for loss per share) reconciles basic and diluted weighted average common shares outstanding for the years ended December 31, 2022 and 2021 :

Weighted average common shares outstanding:

130,136  

119,201  

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

130,136  

119,201  

Basic and diluted net loss per share attributable to common stockholders

$ ( 0.65 )  

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):

Unvested stock (1)

On February 3, 2023, the Company entered into a common stock purchase agreement (the “Stock Purchase Agreement”) for a private placement with HGC NEXT INV LLC and Ninteenth Investment Company LLC, pursuant to which the Company sold an aggregate of 5.8 million shares of the Company common stock for aggregate proceeds of $ 35.0 million.

On June 13, 2023, the Company entered into a common stock purchase agreement for three private placements with Global LNG North America Corp., an affiliate of TotalEnergies SE pursuant to which we agreed to sell an aggregate of 17.5 % of the Company's common stock outstanding by the closing of third private placement.

In aggregate, the Company sold approximately 44.9 million shares for aggregate proceeds of approximately $ 219.4 million.

The details of the three private placements are as follows:

• Approximately 8.0 million shares were sold for proceeds of $ 40.0 million on June 14, 2023.

• Approximately 22.1 million shares were sold for proceeds of $ 110.0 million on July 26, 2023.

• Approximately 14.8 million shares were sold for proceeds of $ 69.4 million on September 8, 2023.

NextDecade Corporation

Notes to Consolidated Financial Statements

Note 13 — Net Loss Per Share

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

Year Ended December 31,

Unvested stock and stock units (1)

Convertible preferred stock — 46,533

46,533  

30,754  

Common Stock Warrants 1,548 1,382

IPO Warrants (2)

12,082  

Total potentially dilutive common shares 6,390 49,819

49,819  

46,705  

Does not include 9.4 million shares and 8.3 million shares of unvested restricted stock and restricted stock units for the years ended 

December 31, 2022 and 2021 because the performance conditions had not yet been satisfied as of 

December 31, 2022 and 2021 , respectively.

The IPO Warrants were issued in connection with our initial public offering in 2015 and expired July 24, 2022. 

12  —

Share-based Compensation

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.

____________________________

(1) Includes the impact of unvested shares containing performance conditions to the extent that the underlying performance conditions are satisfied based on actual results as of the respective dates.

Note 14 — Share-based Compensation

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):

Share-based compensation expense (forfeiture):

Year Ended December 31,

Share-based compensation expense:

Equity awards $ 26,039 $ 7,472

$ 7,472  

Liability awards 514 —

Total share-based compensation (forfeiture)

Capitalized share-based compensation

Total share-based compensation expense (forfeiture)

$ 7,472  

Certain employee arrangements provided for cash bonuses upon a positive FID on 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 accrued liabilities and other current liabilities in our Consolidated Balance Sheets at each of 

December 31, 2022 and 2021 .

The total unrecognized compensation costs at 

December 31, 2022 relating to equity-classified awards were $ 48.1  million, which is expected to be recognized over a weighted average period of 1.5 years.

Total share-based compensation expense 26,553 7,472

The total unrecognized compensation costs at December 31, 2023 relating to equity-classified awards were $ 52.5 million, which is expected to be recognized over a weighted average period of 1.8 years.

Restricted Stock Awards

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.

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

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

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

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

December 31, 2022 and changes during the year ended 

December 31, 2022 (in thousands, except for per share information): 

Weighted Average Grant Date Fair Value Per Share

The table below provides a summary of our restricted stock awards outstanding as of December 31, 2023 and changes during the year ended December 31, 2023 (in thousands, except for per share information):

Shares Weighted Average Grant Date Fair Value Per Share

Non-vested at January 1, 2023 1,083 $ 7.51

$ 5.88  

( 1,507 )  

( 665 )  

Granted 107 5.99

Vested ( 1,161 ) 8.55

Forfeited ( 16 ) 6.39

Non-vested at December 31, 2023 13 $ 2.24

$ 7.51  

NextDecade Corporation

Notes to Consolidated Financial Statements

Restricted Stock Units and Performance Stock Units

Restricted stock units are stock awards that vest over a service period of 

one , two , or three years and entitle the holder to receive shares of our common stock upon vesting, subject to restrictions on transfer and to a risk of forfeiture if the recipient terminates employment with us prior to the lapse of the restrictions.

Certain performance stock units provide for cliff vesting after a period of 

three years with payouts based upon market conditions achieved over the defined performance period compared to pre-established performance targets.

The settlement amounts of the awards are based on market conditions consisting of total shareholder return (“TSR”) and relative total shareholder return (“RTSR”) of our common stock. 

Where applicable, the compensation for performance stock units containing market conditions of TSR and RTSR are based on a fair value using a Monte Carlo simulation as of the grant date, which utilizes level 3 inputs such as projected stock volatility and projected risk-free rates and remains constant through the vesting period.

The number of shares that may be earned at the end of the vesting period ranges from 

0 % up to 

100 % of the target award amount.

Restricted stock units are stock awards that vest over a service period of one , two , or three years and entitle the holder to receive shares of our common stock upon vesting, subject to restrictions on transfer and to a risk of forfeiture if the recipient terminates employment with us prior to the lapse of the restrictions.

Certain performance stock units provide for cliff vesting after a period of three years with payouts based upon market conditions achieved over the defined performance period compared to pre-established performance targets.

The settlement amounts of the awards are based on market conditions consisting of total shareholder return (“TSR”) and relative total shareholder return (“RTSR”) of our common stock.

Where applicable, the compensation for performance stock units containing market conditions of TSR and RTSR are based on a fair value using a Monte Carlo simulation as of the grant date, which utilizes level 3 inputs such as projected stock volatility and projected risk-free rates and remains constant through the vesting period.

The number of shares that may be earned at the end of the vesting period ranges from 0 % up to 100 % of the target award amount.

Both restricted stock units and performance stock units will be settled in Company common stock (on a one-for-one basis) and are classified as equity awards.

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

December 31, 2022 and changes during the year ended 

December 31, 2022 (in thousands, except for per share information):

Weighted Average Grant Date Fair Value Per Share

The table below provides a summary of our restricted stock units outstanding as of December 31, 2023 and changes during the year ended December 31, 2023 (in thousands, except for per share information):

Shares Weighted Average Grant Date Fair Value Per Share

Non-vested at January 1, 2023 10,304 4.82

( 1,261 )  

( 1,645 )  

Granted 5,680 5.72

Vested ( 2,782 ) 7.82

Forfeited ( 403 ) 5.06

Non-vested at December 31, 2023 12,799 $ 4.72

10,304  

$ 4.82  

13  —

Note 15 — Income Taxes

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

Year Ended December 31,

federal statutory rate, beginning of year 21 % 21 %

Common stock warrant liabilities  

Non-controlling interest ( 6 ) —

Officers' compensation ( 2 ) ( 1 )

Other — ( 1 )

Valuation allowance ( 13 ) ( 19 )

( 17 )  

Effective tax rate as reported — % — % — %

Significant components of our deferred tax assets and liabilities at 

December 31, 2022 and 2021 are as follows (in thousands):

NextDecade Corporation

Notes to Consolidated Financial Statements

Significant components of our deferred tax assets and liabilities at December 31, 2023 and 2022 are as follows (in thousands):

Deferred tax assets

Net operating loss carryforwards and credits $ 54,839 $ 36,835

$ 36,835  

$ 25,742  

Employee compensation

Share-based compensation expense

Development costs

Investment in Intermediate Holdings 31,782 —

Property, plant and equipment — 749

Operating lease liabilities 2,972 187

Other 4,996 3,179

valuation allowance ( 91,465 ) ( 36,642 )

( 36,642 )  

Total deferred tax assets 3,124 4,308

1 unchanged sentence

Operating lease right-of-use assets ( 2,809 ) ( 4,308 )

( 4,308 )  

Other ( 315 ) —

Total deferred tax liabilities ( 3,124 ) ( 4,308 )

( 4,308 )  

Net deferred tax assets (liabilities) $ — $ —

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

At December 31, 2022 , we had federal net operating loss (“NOL”) carryforwards of approximately $ 175.4  million.

At December 31, 2023, we had federal net operating loss (“NOL”) carryforwards of approximately $ 260.7 million.

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

1 unchanged sentence

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

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

December 31, 2022 or 2021 . 

Due to our full valuation allowance, we have not recorded a provision for federal or state income taxes during the years ended December 31, 2023 or 2022.

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

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

382 of the Internal Revenue Code (“Section 382”

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

The Company has not completed a detailed Section 

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

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

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

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

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

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

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

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

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

1 unchanged sentence

The federal tax returns for the years beginning 2019 remain open for examination.

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

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

For the year ended December 31, 2022, there were no material tax impacts to our consolidated financial statements from the CARES Act, the CAA or other COVID- 19 measures. 

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

Treasury Department, the Internal Revenue Service and others.

14  —

Commitments and Contingencies

Obligation under LNG Sale and Purchase Agreement

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

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

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

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

The Company is party to other SPAs which will become effective upon the occurrence of certain conditions precedent, including completion of the construction of the Terminal.

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.

April 20, 2022 ,  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, 2023 ( 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, 2024 

by providing the BND with written notice of its election 

no  later than the close of business on the Effective Date. 

In connection with the Rio Grande Site Lease Amendment, Rio Grande is committed to pay approximately $ 1.6 million per quarter to the BND through the earlier of the Effective Date and lease commencement.

Note 16 — Commitments and Contingencies

Legal Proceedings

From time to time the Company may be subject to various claims and legal actions that arise in the ordinary course of business.

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

As of December 31, 2022 , management was not aware of any claims or legal actions that, separately or in the aggregate, are likely to have a material adverse effect on the Company’s financial position, results of operations or cash flows, although the Company cannot guarantee that a material adverse event will not occur.

Note 15  —

Recent Accounting Pronouncements 

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

Date of Adoption

Effect on our Consolidated Financial Statements or Other Significant Matters

2020 - 06,  Debt - Debt with Conversion and Other Options ( Subtopic  

470 - 20 ) and Derivatives and Hedging - Contracts in Entity's Own Equity ( Subtopic  

Accounting for Convertible Instruments and Contracts in Entity's Own Equity  

This standard simplifies the accounting for convertible instruments primarily by eliminating the existing cash conversion and beneficial conversion models within Subtopic 

470 - 20,  which will result in fewer embedded conversion options being accounted for separately from the host. 

This standard also amends and simplifies the calculation of earnings per share relating to convertible instruments.

January 1, 2022

The Company adopted this standard using the modified retrospective approach, which did 

not  have an effect on the Company's Consolidated Financial Statements.

Note 16  —

Subsequent Events

On February 3, 2023, 

we entered into a common stock purchase agreement (the “Stock Purchase Agreement”) for a private placement (the “Private Placement”) with HGC NEXT INV LLC and Ninteenth Investment Company LLC (the “Purchasers”), pursuant to which we agreed to sell, and the Purchasers severally agreed to purchase, an aggregate of 5,835,277 shares of the Company’s common stock at a purchase price of $ 5.998 per share, representing the average closing trading price of the Common Stock for the five trading days immediately preceding signing the Stock Purchase Agreement, for an aggregate purchase price of $ 35.0 million.

We have evaluated subsequent events through March 10, 2023, 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 consolidated financial statements.

Changes in and Disagreements with Accountants

Item 9A.

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

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

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

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

as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the fiscal year ended December 31, 2022.

Based on this evaluation, our principal executive officer and principal financial officer have concluded that, as of December 31, 2022, our disclosure controls and procedures were effective.

Management’s Report on Internal Controls Over Financial Reporting

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

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

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

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

Based on our assessment, we have concluded that the Company maintained effective internal control over financial reporting as of December 31, 2022, based on criteria in Internal Control—Integrated Framework (2013) issued by the COSO.

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

Management’s report on internal control over financial reporting for the year ended December 31, 2022 was not required to be attested by the Company’s registered public accounting firm pursuant to Item 308(b) of Regulation S-K.

Changes in Internal Control over Financial Reporting

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

Item 9B.

Other Information

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Directors, Executive Officers and Corporate Governance

The information required by this Item is incorporated by reference to the applicable information in 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, 2022.

Executive Compensation

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Certain Relationships and Related Transactions, and Director Independence

Principal Accounting Fees and Services

Item 15.

Exhibit and Financial Statement Schedules

Financial Statements, Schedules and Exhibits

Financial Statements –

NextDecade Corporation and Subsidiaries:

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets

Consolidated Statements of Operations 

Consolidated Statements of Stockholders’

Consolidated Statements of Cash Flows

As of December 31, 2023, management is not aware of any claims or legal actions that, separately or in the aggregate, are likely to have a material adverse effect on the Company’s financial position, results of operations or cash flows, although the Company cannot guarantee that a material adverse effect will not occur.

NextDecade Corporation

Notes to Consolidated Financial Statements

Financial Statement Schedules:

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

Exhibit No.

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

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

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

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

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

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

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

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

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

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

Certificate of Amendment to Certificate of Designations of Series A Convertible Preferred Stock, dated July 12, 2019 (Incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K, filed July 15, 2019)

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

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

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

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

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

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

Amendment No.

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

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

Specimen Common Share Certificate 

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

Specimen IPO Warrant Certificate 

(Incorporated by reference to Exhibit 4.3 of the Amendment No.

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

Form of Warrant Agreement between Harmony Merger Corp.

and Continental Stock Transfer & Trust Company 

(Incorporated by reference to Exhibit 4.4 of the Amendment No.

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

Form of Warrant Agreement for the Series A Warrants 

(I ncorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K, filed August 7, 2018)

Form of Warrant Agreement for the Series B Warrants 

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

Form of Warrant Agreement for the Series C Warrants 

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

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

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

10.1 †

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

Schatzman 

(Incorporated by reference to Exhibit 10.1 of the Company ’

s Form 8-K, filed September 11, 2017)

10.2 †

NextDecade Corporation 2017 Omnibus Incentive Plan 

(Incorporated by reference to Exhibit 10.1 of the Company ’

s Registration Statement on Form S-8, filed December 15, 2017)

10.3 †

Form of Restricted Stock Award Agreement  

(Incorporated by reference to Exhibit 10.2 of the 

Company’s Form  

8-K, filed December 20, 2017)

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

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

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

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

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

(Incorporated by reference to Exhibit 10.2 of the Company ’

s Form 8-K, filed August 24, 2018)

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

(Incorporated by reference to Exhibit 10.3 of the Company ’

s Form 8-K, filed August 24, 2018)

Amendment No.

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

(Incorporated by reference to Exhibit 10.28 of the Company ’

s Annual Report on Form 10-K, filed March 6, 2019)

Amendment No.

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

(Incorporated by reference to Exhibit 10.29 of the Company ’

s Annual Report on Form 10-K, filed March 6, 2019)

Amendment No.

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

(Incorporated by reference to Exhibit 10.30 of the Company ’

s Annual Report on Form 10-K, filed March 6, 2019)

10.11 †

Amendment No.

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

Schatzman 

(Incorporated by reference to Exhibit 10.31 of the Company ’

s Annual Report on Form 10-K, filed March 6, 2019)

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

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

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

as Contractor, dated as of May 24, 2019  

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

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

as Contractor, dated as of May 24, 2019  

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

10.15 †

Form of Non-Affiliate Director Restricted Stock Award Agreement  

(Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q, filed November 5, 2019)

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

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

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

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

10.18 †

Director Compensation Policy 

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

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

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

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

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

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

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

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

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

Second Amendment to Lease Agreement, made and entered into as of April 20, 2022, by and between Brownsville Navigation District of Cameron County, Texas and Rio Grande LNG, LLC (Incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed August 11, 2022)

First Amendment to the Fixed Priced Turnkey Agreement for the Engineering, Procurement and Construction of Trains 1 and 2 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of April 22, 2020, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc. (Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q, filed August 6, 2020)

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

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

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

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

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. 

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

10.28 †

Amendment No.

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

Schatzman 

(Incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form 10-Q, filed August 2, 2021)

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. 

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

Third Amendment to the Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of March 5, 2021, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc. (Incorporated by reference to Exhibit 10.36 of the Company's Annual Report on Form 10-K filed March 25, 2021)

Fourth 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 April 29, 2022, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc. (Incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed August 11, 2022)

Fourth Amendment to the Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of April 29, 2022, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

(Incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed August 11, 2022)

Fifth 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 September 14, 2022, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

(Incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed November 10, 2022)

Fifth Amendment to the Fixed Price Turnkey Agreement for the Engineering, Procurement and Construction of Train 3 of the Rio Grande Natural Gas Liquefaction Facility, made and executed as of September 15, 2022, by and between Rio Grande LNG, LLC and Bechtel, Oil, Gas and Chemicals, Inc.

(Incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed November 10, 2022)

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

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

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

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

10.37* †

Form of time-based restricted stock unit agreement

10.38* †

Form of performance-based restricted stock unit agreement

Common Stock Purchase Agreement, dated as of April 6, 2022, by and between the Company and HGC NEXT INV LLC (Incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed April 7, 2022)

Registration Rights Agreement, dated as of April 6, 2022, by and between the Company and HGC NEXT INV LLC (Incorporated by reference to Exhibit 10.2 of the Company's Form 8-K, filed April 7, 2022)

Common Stock Purchase Agreement, dated as of September 14, 2022, by and between the Company and the various investors party thereto (Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K, filed September 19, 2022)

Registration Rights Agreement, dated as of September 19, 2022, by and between the Company and the various investors party thereto (Incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K, filed September 19, 2022)

Subsidiaries of the Company

Consent of Grant Thornton LLP

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

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

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

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

Inline XBRL Instance Document (the Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Inline XBRL Taxonomy Extension Definition Linkbase Document.

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

Filed herewith.

Furnished herewith.

Indicates management contract or compensatory plan.

Certain portions of this exhibit have been omitted.

Form 10-K Summary

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

Note 17 — Supplemental Cash Flows

The following table provides supplemental disclosure of cash flow information (in thousands):

Year Ended December 31,

Cash paid for interest, net of amounts capitalized $ 23,365 $ —

Non-cash investing activities:

Accounts payable for acquisition of property, plant and equipment $ 238,105 $ 162

Accrued liabilities for acquisition of property, plant and equipment 268,821 12,046

Accrued liabilities for acquisition of other non-current assets — 279

Non-cash financing activities:

Paid-in-kind dividends on Convertible Preferred Stock $ 20,431 $ 24,207

Accrued liabilities for debt and equity issuance costs 764 —

Note 18 — Subsequent Events

NextDecade LLC Revolver

On January 4, 2024, NextDecade LLC entered into a Credit and Guaranty Agreement by and among NextDecade LLC, as borrower, Rio Grande LNG Super Holdings, LLC and Rio Grande LNG Intermediate Super Holdings, LLC, as subsidiary guarantors, MUFG Bank, Ltd., as the administrative agent (the “Administrative Agent”), Wilmington Trust, National Association, as the collateral agent (the “Collateral Agent”), MUFG Bank, Ltd., as coordinating lead arranger and bookrunner and the financial institutions party thereto as lenders.

The Credit and Guarantee Agreement provides for the following facilities:

• a revolving loan facility (the “Revolving Loans”) in an amount up to $ 50 million available to NextDecade LLC to be used for (a) general corporate purposes and working capital requirements of NextDecade LLC and its subsidiaries, including development costs related to the fourth liquefaction train and related common facilities at the Rio Grande LNG Facility, and (b) certain permitted payments on behalf of the Company and its subsidiaries;

• an interest loan facility (the “Interest Loans” and together with the Revolving Loans, the “Loans”) in an amount up to $ 12.5 million available to NextDecade LLC to pay interest obligations, fees, and expenses due and payable under the Credit Agreement and the other finance documents.

The principal amount of the Loans must be repaid on the maturity date, which is the earlier of (a) the second anniversary of the Closing Date or such later anniversary of the Closing Date as may be determined by a unanimous decision of the lenders following a written request from NextDecade LLC and (b) ten business days after the date a final investment decision is taken by the board of directors of the Company in respect of the development of the fourth liquefaction train and related common facilities at the Rio Grande LNG Facility.

NextDecade LLC may extend the maturity to the date that is ninety days after the date in clause (b) if it delivers written notice to the lenders specifying in reasonable detail its expected source of liquidity to repay all outstanding obligations under the Credit Agreement and the other finance documents on the last day of the requested ninety-day extension.

NextDecade LLC may make borrowings based on SOFR plus the applicable margin ( 4.50 %) or the base rate plus the applicable margin ( 3.50 %).

NextDecade LLC will pay commitment fees on the undrawn amount of the loan commitments.

Additional Rio Grande Senior Notes

On February 9, 2024, Rio Grande issued and sold $ 190 million aggregate principal amount of 6.85 % Senior Secured Notes due 2047 (the “ 6.85 % Senior Notes”) pursuant to an indenture between Rio Grande and Wilmington Trust, National Association, as Trustee (the “Indenture”).

The issuance and sale of the 6.85 % resulted in a reduction in the commitments under Rio Grande's existing term loan facilities for Phase 1 from approximately $ 10.5 billion to approximately $ 10.3 billion.

The 6.85 % Senior Notes will be amortized over a period of approximately 18 years beginning in mid-2029, with a final maturity in June 2047, and will accrue interest from February 9, 2024 at a rate equal to 6.85 % per annum on the outstanding principal amount, with such interest payable semi-annually, in cash in arrears, on June 30 and December 30 of each year, beginning on June 30, 2024.

NextDecade Corporation

/s/ Matthew K.

Chairman of the Board and Chief Executive Officer

(Principal Executive Officer)

March 10, 2023

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

/s/ Matthew K.

Chairman of the Board and Chief Executive Officer

March 10, 2023

(Principal Executive Officer)

Chief Financial Officer

March 10, 2023

(Principal Financial Officer)

/s/ Eric Garcia

Senior Vice President and Chief Accounting Officer

March 10, 2023

(Principal Accounting Officer)

/s/ Giovanni Oddo

March 10, 2023

Giovanni Oddo

/s/ Brian Belke

March 10, 2023

/s/ Frank Chapman

March 10, 2023

Frank Chapman

/s/ Seokwon Ha

March 10, 2023

/s/ Avinash Kripalani

March 10, 2023

Avinash Kripalani

/s/ Edward Andrew Scoggins, Jr.

March 10, 2023

Edward Andrew Scoggins, Jr.

/s/ William Vrattos

March 10, 2023

William Vrattos

/s/ Spencer Wells

March 10, 2023

Spencer Wells

Notes to Consolidated Financial Statements

Changes in and Disagreements with Accountants

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