Cheniere Energy Inc. (NYSE: LNG) priced an offering of its 4.25% convertible senior notes due 2045 through a Securities and Exchange Commission registered direct offering. The aggregate principal amount of the offering was $625 million. The convertible notes will bear interest at a rate of 4.25% per year, paid semi-annually in arrears, and will mature on March 15, 2045. Before Dec. 15, 2044, the notes will be convertible upon the occurrence of certain conditions, and on and after that date will become freely convertible.

The convertible notes will be convertible into Cheniere common stock at an initial conversion price of $138.38 per share, representing about 170% of the last reported sale price of the common stock of Cheniere on March 3. Cheniere may have the ability under certain conditions to terminate the conversion rights of all or part of the notes. After March 15, 2020, Cheniere may also choose to redeem all or part of the notes at a price equal to the accreted amount of the notes to be redeemed, plus any accrued and unpaid interest up to but excluding the redemption date.

Net proceeds from the offering are expected to be about $500 million, before transaction fees and expenses. Cheniere plans to use the proceeds for general corporate purposes.

The offering is expected to close on March 9, subject to customary closing conditions, at which time Cheniere will have entered into a base indenture and a supplemental indenture pursuant to which the notes will be issued.

Lazard Frères & Co. LLC acted as placement agent in connection with the offering