of New York against the Company and certain of the Company’s directors and officers. The complaint alleges that the Company and certain of the Company’s directors and officers violated federal securities laws by, among other things, making materially false or misleading statements regarding the Company’s growth trends, including the execution on the Company’s fast liquified natural gas (“Fast LNG”) projects in Mexico. The complaint seeks unspecified compensatory damages on behalf of the Plaintiff and all other investors who purchased or otherwise acquired shares of the Company’s Class A common stock between February 29, 2024 and August 8, 2024. The Company believes these claims are without merit and intend to defend ourselves vigorously against these allegations.
Series B Convertible Preferred Stock
On October 1, 2024, the Company issued shares of its 4.8% Series B Convertible Preferred Stock (the “Series B Convertible Preferred Stock”) in exchange for all outstanding shares of its 4.8% Series A Convertible Preferred Stock as previously disclosed on its Current Report on Form 8-K filed on September 27, 2024.
Compliance with Financial Covenants
As previously disclosed, on August 31, 2024, the Company entered into the fourth amendment to its uncommitted letter of credit and reimbursement agreement (the “Fourth Amendment”), the first amendment to its term loan A credit agreement (the “First Amendment”), and the eighth amendment (the “Eighth Amendment”; and collectively with the Fourth Amendment and the First Amendment, the “Amendments”) to its revolving credit agreement (the “Revolving Credit Agreement”). On September 30, 2024, the Company amended and restated each of the Amendments (each such amendment and restatement, an “Amended and Restated Amendment”; the revolving credit facility, the term loan A facility, and the letter of credit facility, as amended by the respective Amended and Restated Amendments, the “Revolving Credit Facility,” the “Term Loan A Facility” and the “Letter of Credit Facility” and collectively, the “Amended Agreements”).
The Company expects that it will be in compliance with the financial covenants that were not suspended as part of the Amended Agreements through the end of the fiscal year ending December 31, 2025. The Company’s expectations regarding its covenant compliance is based, in part, on its ability to complete anticipated sales of certain assets, the receipt of certain payments related to cost savings recognized by PREPA, revenues from the commencement of operations in Brazil and Nicaragua and revenues from certain contracts expected to be received in future periods, as well as the achievement of certain expected cost savings and a reduction in SG&A. The Company’s ability to remain in compliance is subject to a number of risks, some of which are outside the Company’s control, and there can be no assurances that the Company will be able to comply with its financial covenants in future periods. See “Cautionary Statement Regarding Forward-Looking Statements.”
Controlled Company Status
Following this offering, we will no longer be a “controlled company” within the meaning of Nasdaq corporate governance standards and, as a result, will no longer qualify for exemptions from certain corporate governance requirements. Accordingly, on September 30, 2024, Messrs. Edens and Nardone resigned from the Compensation Committee of the Company’s Board of Directors, effective as of such date and the Board made related changes to the Compensation Committee, the members of which are now David G. Grain, Timothy W. Jay and C. William Griffin. Furthermore, the Board adopted amended corporate governance guidelines and amended the compensation committee charter to comply with the Nasdaq corporate governance standards.
Corporate Information
NFE LLC was formed as a Delaware limited liability company by New Fortress Energy Holdings on August 6, 2018. On August 7, 2020, effective as of the Conversion Effective Time, NFE LLC was converted from a Delaware limited liability company to NFE Inc., a Delaware corporation.
Our principal executive office is located at 111 W. 19th Street, 8th Floor, New York, NY 10011 and our telephone number is (516) 268-7400. We maintain a website at www.newfortressenergy.com. We have included our website address in this prospectus supplement solely as an inactive textual reference. The information on or otherwise accessible through our website does not constitute a part of, and is not incorporated by reference into, this prospectus supplement or the accompanying prospectus.