Exhibit 10.12

 

FORM OF CONSENT AGREEMENT NO. 7

TO CREDIT AGREEMENT

 

This CONSENT AGREEMENT NO. 7 TO CREDIT AGREEMENT (this “Consent”), dated as of
August 30, 2005, is made among Sabine Pass LNG, L.P., a Delaware limited
partnership (the “Borrower”), Société Générale, in its capacity as
administrative agent for the Lenders (the “Agent”), HSBC Bank USA, National
Association, in its capacity as collateral agent for the Lenders (the
“Collateral Agent”) and the Lenders party to the Credit Agreement (as defined
below).

 

W I T N E S S E T H

 

WHEREAS, the Borrower, the Agent and the Collateral Agent are party to a Credit
Agreement dated as of February 25, 2005 (as amended, modified and supplemented
and in effect from time to time, the “Credit Agreement”), pursuant to which the
lenders from time to time party thereto (the “Lenders”) have agreed to make
loans to the Borrower in an aggregate principal amount of $822,000,000;

 

WHEREAS, the Borrower and Bechtel Corporation (the “EPC Contractor”) have
entered into an Engineering, Procurement and Construction Agreement (as amended,
modified and supplemented and in effect from time to time, the “EPC Contract”)
relating to the Project;

 

WHEREAS, pursuant to Section 8.20(a)(v) of the Credit Agreement, consent of the
Majority Lenders is required for the Borrower to enter into any Change Order for
an amount greater than $35 million which causes any material component or
material design feature or aspect of the Project to deviate in a fundamental
manner from the specifications set forth in the EPC Contract;

 

WHEREAS, pursuant to the consent request letter (the “Consent Request Letter”),
attached hereto as Exhibit A, the Borrower has requested the Lenders’ consent
for a Change Order with respect to an increase in the Project’s send-out
pressure (the “Change Order”) which will result in an increase in the price of
the EPC Contract of not more than $50 million (as more fully described in the
Consent Request Letter).

 

NOW THEREFORE, in consideration of the mutual agreements herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound hereby,
agree as follows:

 

Section 1. Definitions. Capitalized terms (including those used in the preamble
and the recitals above) not otherwise defined herein shall have the meanings
assigned to such terms in the Credit Agreement and the principles of
interpretation set forth therein shall apply herein.

 

Section 2. Consent. Subject to the satisfaction of the conditions set forth in
Section 3 and Section 4 hereof, the Agent, acting with the consent of the
Majority Lenders,

 

Consent and Amendment No. 7

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hereby consents, pursuant to Section 8.20(a)(v) of the Credit Agreement, to the
Borrower entering into the Change Order solely to the extent such Change Order
conforms to the description thereof set forth in the Consent Request Letter. As
further described in Section 4(c) below, this Consent shall not be deemed to be
an approval of the terms and conditions of any long-term services contract or
lease engine agreement referred to in the Consent Request Letter.

 

Section 3. Conditions Precedent. This Consent shall become effective on the date
on which the Agent has received counterparts of this Consent duly executed and
delivered by the Borrower.

 

Section 4. Conditions Subsequent. This Consent shall be conditioned upon the
satisfaction of the following conditions:

 

(a) upon execution of the Change Order, receipt by the Collateral Agent from the
Borrower of the amount of the Change Order in cash for deposit to the
Construction Account in accordance with Section 8.20(a)(i)(C) of the Credit
Agreement. For the avoidance of doubt, funds deposited to the Construction
Account pursuant to this Section 4(a) shall (i) not constitute part of, and
shall be in addition to, the Equity Contribution Amount and (ii) shall, together
with the Equity Contribution Amount, be used to pay Project Costs prior to the
Funding Date;

 

(b) receipt by Agent of an execution form of the Change Order satisfactory to
the Independent Engineer and consistent in all material respects with the
purchase order and the Change Order in each case as described in the Consent
Request Letter and, in the case of the Change Order, which shall not be greater
than $50 million; and

 

(c) receipt by the Agent of an executed copy of each document or instrument
executed in connection with the Change Order and, to the extent such documents
or instruments constitute Additional Project Documents, the Borrower shall
obtain the necessary consent of the Lenders and shall deliver all required
Ancillary Documents related thereto.

 

Section 5. Miscellaneous.

 

(a) Limited Consent.

 

(i) Except as expressly consented to hereby, all of the representations,
warranties, terms, covenants, conditions and other provisions of the Credit
Agreement and the other Financing Documents shall remain unchanged and unwaived
and shall continue to be and shall remain in full force and effect in accordance
with their respective terms.

 

(ii) The consent set forth herein shall be limited precisely as provided for
herein to the provisions expressly consented to and shall not be deemed to be a
waiver of any right, power or remedy of any Lender, the Agent or the Collateral
Agent under, or a waiver of, consent to or modification of, any other term or
provision of the Credit Agreement, any other Financing Document referred to
therein or herein or of any transaction or further or future action on the part
of the Borrower which would require the consent of the Lenders under the Credit
Agreement or any of the other Financing Documents.

 

Consent and Amendment No. 7

 

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(iii) Except as provided in Section 2 hereof, nothing contained in this Consent
shall abrogate, prejudice, diminish or otherwise affect any powers, rights,
remedies or obligations of any Person arising before the date of this Consent.

 

(b) Financing Document. This Consent shall be deemed to be a Financing Document
referred to in the Credit Agreement and shall be construed, administered and
applied in accordance with the terms and provisions thereof.

 

(c) Counterparts; Integration; Effectiveness. This Consent may be executed in
any number of counterparts, all of which taken together shall constitute one and
the same instrument and any party hereto may execute this Consent by signing any
such counterpart.

 

(d) Costs and Expenses. The Borrower agrees to pay and reimburse the Agent for
all its reasonable costs and out-of-pocket expenses (including, without
limitation, the reasonable fees and expenses of counsel to the Agent and the
Lenders) incurred in connection with the preparation and delivery of this
Consent and such other related documents.

 

(e) Governing Law. THIS CONSENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

 

[Signature Pages Follow]

 

Consent and Amendment No. 7

 

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IN WITNESS WHEREOF, the parties hereto have caused this Consent to be duly
executed and delivered as of the day and year first above written.

 

SABINE PASS LNG, L.P.,     as Borrower By:   Sabine Pass LNG – GP, Inc.,     its
General Partner By:  

/s/ Graham McArthur

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Name:   Graham McArthur Title:   Treasurer Address for Notices: 717 Texas
Avenue, Suite 3100 Houston, TX 77002 Attn: Treasurer

 

Consent and Amendment No. 7

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SOCIÉTÉ GÉNÉRALE,     as Agent By:  

/s/ Deepa Dadlani

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Name:   Deepa Dadlani Title:   Vice President Address for Notices: 1221 Avenue
of the Americas New York, NY 10020 Attn: Robert Preminger

 

Consent and Amendment No. 7

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HSBC BANK USA, NATIONAL ASSOCIATION,     as Collateral Agent By:  

/s/ Deirdra N. Ross

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Name:   Deirdra N. Ross Title:   Assistant Vice President Address for Notices:
HSBC Bank USA, National Association 452 Fifth Avenue New York, NY 10018 Attn:
Corporate Trust With a copy to: DLA Piper Rudnick Gray Cary US LLP One Liberty
Place 1650 Market Street, Suite 4900 Philadelphia, PA 19103 Attn: Peter Tucci,
Esq.

 

Consent and Amendment No. 7

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Exhibit A

to Consent and Amendment No. 6

 

Consent Request Letter

 

(see attached)

 

Consent and Amendment No. 7