Exhibit 10.2

 

Personal and Confidential

 

THE SHARES OF COMMON STOCK, $0.003 PER SHARE (“SHARES”), OF CHENIERE ENERGY,
INC. (“CHENIERE”) CONSTITUTE SECURITIES THAT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE APPLICABLE SECURITIES
LAWS OF ANY STATE (“STATE LAWS”). THE SHARES MAY NOT, AT ANY TIME, BE OFFERED
FOR SALE, SOLD OR OTHERWISE TRANSFERRED WITHOUT REGISTRATION UNDER THE ACT AND
STATE LAWS, OR DELIVERY TO CHENIERE OF AN OPINION OF LEGAL COUNSEL SATISFACTORY
TO CHENIERE THAT SUCH REGISTRATION IS NOT REQUIRED. RESTRICTIONS ON TRANSFER
WILL BE IMPRINTED ON THE DOCUMENTS EVIDENCING THE SHARES TO THE FOREGOING
EFFECTS.

 

THE PURCHASE OF SHARES INVOLVES A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED
ONLY BY PERSONS WHO CAN BEAR THE RISK OF LOSING THEIR ENTIRE INVESTMENT.

 

SUBSCRIPTION AGREEMENT

 

Cheniere Energy, Inc.

c/o Don A. Turkleson

333 Clay Street, Suite 3400

Houston, Texas 77002

 

Ladies and Gentlemen:

 

The undersigned (the “Subscriber”) hereby subscribes for the number of shares of
common stock, $0.003 per share (the “Shares”), of Cheniere Energy, Inc.
(“Cheniere”) specified in Section 13. The Subscriber understands that the Shares
have not been registered under the Act or any State Law and is being made only
to “accredited investors” (as defined in Rule 501 of Regulation D under the
Act).

 

1. Subscription. Subject to the terms and conditions hereof, the Subscriber
hereby irrevocably subscribes for the number of Shares and makes the purchase
payment set forth in Sections 13 and 14 (the “Subscription”). The total amount
due for such purchase shall be payable in full in readily available funds, as
described in Section 3. The Subscriber acknowledges that the Shares will be
subject to restrictions on transfer pursuant to applicable law and the terms set
forth in this Subscription Agreement.

 

2. Acceptance of Subscription and Issuance of Shares. It is understood and
agreed that Cheniere shall have the sole right, at its complete discretion, to
accept or reject this Subscription, in whole or in part, for any reason and that
the same shall be deemed to be accepted by Cheniere only when it is signed by a
duly authorized officer of Cheniere. It is understood and agreed that, upon
execution of this Subscription Agreement, Cheniere has, in reliance upon the
representations and warranties of the Subscriber and against payment for the

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Shares, accepted this Subscription. Notwithstanding anything in this
Subscription Agreement to the contrary, there shall be no obligation to issue
any Shares if such issuance would constitute a violation of the Act or State
Laws.

 

3. Payment for Shares. Payment for the Shares shall be received by Cheniere from
the Subscriber on or before execution of this Subscription Agreement by the
Subscriber, in cash, cashier’s check or by wire transfer.

 

4. Representations, Warranties and Covenants of the Subscriber. The Subscriber
hereby represents, warrants and covenants to Cheniere and each officer, director
and agent of Cheniere that:

 

(a) General:

 

(i) If the Subscriber is a natural person, he or she has the legal capacity and
all requisite authority to enter into, execute and deliver this Subscription
Agreement, to purchase the Shares and to perform all of the obligations required
to be performed by the Subscriber hereunder. If the Subscriber is a corporation,
partnership, trust or other entity, it is authorized to purchase the Shares and
otherwise to comply with its obligations under this Subscription Agreement. The
person signing this Subscription Agreement on behalf of such entity is duly
authorized by such entity to do so. This Subscription Agreement is the valid and
binding agreement of the Subscriber and enforceable against the Subscriber in
accordance with its terms.

 

(ii) The principal residence of the Subscriber is at the address listed on page
6 of this Subscription Agreement, or if the Subscriber is a corporation,
partnership, trust or other entity, such Subscriber is organized and qualified
under the law of the state listed in its applicable organizational document
provided herewith.

 

(iii) The Subscriber is subscribing to invest in Cheniere solely for his, her or
its own account, and is not acquiring the Shares as an agent or otherwise for
any other person.

 

(b) Information Concerning the Offering:

 

(i) The Subscriber has had access to all of the reports filed by Cheniere with
the Securities and Exchange Commission (“SEC”) since December 31, 2002
(including, without limitation, Cheniere’s annual report on Form 10-K for the
year ended December 31, 2002, all quarterly reports on Form 10-Q filed after
December 31, 2002, reports on Form 8-K filed on March 7, 2003, June 11, 2003,
August 4, 2003, December 22, 2003 and January 14, 2004, and the registration
statement on Form S-3 filed on December 22, 2003) (collectively, the “SEC
Documents”). In connection with the Subscription, the Subscriber has had access
to, and has relied solely upon, the SEC Documents.

 

(ii) In formulating a decision to invest in the Shares, the Subscriber has been
furnished by Cheniere with all of the information regarding the Company which
the

 

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Subscriber has requested or desired to know, has been afforded the opportunity
to ask questions of and receive answers from duly authorized officers or other
representatives of the Company concerning the Shares and has received any
additional information which the Subscriber has requested. The Subscriber has
not relied or acted on the basis of any information purported to be given on
behalf of Cheniere, except as set forth in the SEC Documents (it being
understood that no person has been authorized by Cheniere to furnish any
information except as set forth in the SEC Documents).

 

(iii) The Subscriber understands that the purchase of the Shares involves
various risks, including those outlined in the SEC Documents and in this
Subscription Agreement. Investment in the Shares being offered should be
regarded as speculative and involving a high degree of risk. The Subscriber is
fully aware of the nature of his, her or its investment in the Shares and the
lack of liquidity of his, her or its investment in the Shares.

 

(iv) The Subscriber understands that no federal or state agency has passed upon
the Shares or made any finding or determination concerning the fairness or
advisability of this Subscription Agreement.

 

(v) The undersigned understands that estimates and projections like those
contained in the SEC Documents, by their nature, involve significant elements of
subjective judgment and analysis that may or may not be correct; that there can
be no assurance that such projections or goals will be attained; and that the
projections and estimates contained in the SEC Documents should not be relied
upon as a promise or representation of the future performance of Cheniere.

 

(c) Status of Subscriber; Additional Information:

 

(i) The Subscriber has such knowledge, skill and experience in business,
financial and investment matters so that he, she or it is capable of evaluating
the merits and risks of an investment in the Shares. To the extent necessary,
the undersigned has retained, at his, her or its own expense, and relied upon,
appropriate professional advice regarding the investment, tax and legal merits
and consequences of this Subscription Agreement and owning the Shares.

 

(ii) The Subscriber represents and warrants that he, she or it has read the
definition of “accredited investor” as defined in Rule 501 of Regulation D under
the Act, and acknowledges by his, her or its signature that he, she or it is an
“accredited investor,” fully capable of subscribing for the Shares by means of
meeting the requirements for an accredited investor.

 

(iii) The Subscriber agrees to furnish any additional information requested to
assure compliance with the Act and State Laws in connection with the purchase
and sale of the Shares.

 

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(d) Restrictions on Transfer or Sale of Shares:

 

(i) The Subscriber is acquiring the Shares solely for his, her or its own
beneficial account, for investment purposes, and not with a view to, or for
resale in connection with, any distribution of the Shares. The Subscriber
understands that the Shares have not been registered under the Act or any State
Law by reason of specific exemptions under the provisions thereof, which depend
in part upon the investment intent of the Subscriber and of the other
representations made by the Subscriber in this Subscription Agreement. The
Subscriber understands that Cheniere is relying upon the representations and
agreements contained in this Subscription Agreement (and any supplemental
information) for the purpose of determining whether this transaction meets the
requirements for such exemptions.

 

(ii) The Subscriber shall not sell, assign, pledge, give, transfer or otherwise
dispose of any Shares or any interest therein, or make any offer or attempt to
do any of the foregoing, except pursuant to a registration of the Shares under
the Act and State Laws or in a transaction that is exempt from the registration
provisions of the Act and any applicable State Laws. The Company agrees that,
within 60 days after the date hereof, it shall file with the SEC on Form S-3 (or
any successor form) a shelf registration statement (the “Shelf Registration”)
pursuant to Rule 415 of the Act covering the offer and resale by the Subscriber
of all of the Shares and shall use its reasonable best efforts to cause the
Shelf Registration to be declared effective by the SEC as promptly thereafter as
possible; provided, however, that if the Company is engaged in, or has
definitive plans to engage in, within 90 days after the date hereof, any
activity or negotiations that, in the good faith determination of the Board of
Directors of the Company, would be adversely affected by disclosure that would
be required in connection with the registration to the material detriment of the
Company, then the Company may delay such registration for a period of 80 days
from the date of termination or disclosure of such activity or negotiations. The
Company agrees to use its commercially reasonable best efforts to cause the
Shelf Registration to remain effective for a period of two years from its
initial effectiveness.

 

(iii) The Subscriber has not offered or sold any portion of his, her or its
Shares and has no present intention of dividing his, her or its Shares with
others or of reselling or otherwise disposing of any portion of the Subscriber’s
Shares either currently or after the passage of a fixed or determinable period
of time or upon the occurrence or nonoccurrence of any predetermined event or
circumstance.

 

5. Condition to Obligations. The Subscription made hereby may be accepted or
rejected by Cheniere at any time after the execution hereof by the Subscriber.
No Subscriber shall have the right to demand a return of his, her or its
Subscription under any circumstances.

 

6. Waiver, Amendment, Binding Effect. Neither this Subscription Agreement nor
any provisions hereof shall be modified, changed, discharged or terminated
except by an instrument in writing, signed by the party against whom any waiver,
change, discharge or termination is sought. The provisions of this Subscription
Agreement shall be binding upon and accrue to the benefit of the parties hereto
and their respective heirs, legal representatives, successors and assigns.

 

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7. Assignability. Neither this Subscription Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by Cheniere or the Subscriber without the prior written consent of
the other.

 

8. Applicable Law. This Subscription Agreement shall be governed by and
construed in accordance with the laws of Texas, without regard to the conflict
of laws provisions thereof.

 

9. Counterparts. This Subscription Agreement may be executed in any number of
counterparts and by facsimile, each of which when so executed and delivered
shall be deemed to be an original and all of which together shall be deemed to
be one and the same agreement.

 

10. Notices. All notices and other communications provided for herein shall be
in writing and shall be deemed to have been duly given if delivered personally
or sent by registered or certified mail, return receipt requested, postage
prepaid:

 

(a) If to Cheniere, to it at the following address:

 

Cheniere Energy, Inc.

c/o Don A. Turkleson

333 Clay Street, Suite 3400

Houston, Texas 77002

 

(b) If to the Subscriber, to him, her or it at the address set forth on the
signature page hereto; or at such other address as either party shall have
specified by notice in writing to the other.

 

11. Survival. All representations, warranties and covenants contained in this
Subscription Agreement shall survive (i) the acceptance of the Subscription by
Cheniere and (ii) the death or disability of the Subscriber.

 

12. Notification of Changes. The Subscriber hereby covenants and agrees to
notify Cheniere upon the occurrence of any event prior to the closing of the
purchase of the Shares pursuant to this Subscription Agreement which would cause
any representation, warranty or covenant of the Subscriber contained in this
Subscription Agreement to be false or incorrect.

 

13. Number of Shares Purchased. The undersigned hereby subscribes to purchase
the following number of shares of Securities:

 

            Shares at $             per Share for an aggregate purchase price of
$                    .

 

14. Purchase Payment. The purchase price is being paid herewith by delivery of
either cash, cashier’s check or wire transfer payable to “Cheniere Energy, Inc.”
in the amount of $                     ($             per share). All payments
made as provided in this Section 14 shall be deposited as soon as practicable.

 

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This Subscription Agreement is executed effective as of the      day of January,
2004, at                         (city),                          (state).

 

BY: (CHECK ONE)

 

_______

 

INDIVIDUAL

_______

 

CORPORATION (Please include a copy and the filing date of the Articles of
Incorporation, bylaws and certified corporate resolution authorizing signature.)

_______

 

PARTNERSHIP (Please include a copy of the Partnership Agreement authorizing
signature.)

_______

 

TRUST (Please include name of trust, name of trustee, and date trust was formed
and a copy of the Trust Agreement or other authorization of signature.)

 

   

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        Please print the EXACT name (registration)         the purchaser desires
to appear in         the records of the Company.        

 

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        Address of Purchaser        

 

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        Social Security or Taxpayer Identification         Number of Purchaser  
 

 

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EXECUTION:

 

Please execute this Subscription Agreement by completing the appropriate section
below.

 

1. If the subscriber is an INDIVIDUAL, complete the following:

 

 

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Signature of Purchaser

 

 

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Name (Please type or print)

 

2. If the subscriber is a CORPORATION, complete the following:

 

The undersigned hereby represents, warrants and covenants that the undersigned
has been duly authorized by all requisite action on the part of the corporation
listed below (the “Corporation”) to acquire the Shares, that the Corporation has
all requisite authority to acquire such Shares, and that the Corporation was not
formed for the purposes of acquiring such Shares.

 

The officer signing below represents and warrants that each of the above
representations or agreements or understandings set forth herein has been made
by the Corporation and that he or she has authority under the Articles of
Incorporation, bylaws and resolutions of the Board of Directors of such
Corporation to execute and deliver this Subscription Agreement on behalf of the
Corporation. Such officer has enclosed a true copy of the Articles of
Incorporation, the bylaws and, as necessary, the resolutions of the Board of
Directors authorizing a purchase of the investment herein, in each case as
amended to date.

 

 

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Name of Corporation (Please type or print)

By:

 

 

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Name:

 

 

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Title:

 

 

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3. If the subscriber is a PARTNERSHIP, complete the following:

 

The undersigned hereby represents, warrants and covenants that the undersigned
is a general partner of the Partnership named below (the “Partnership”), the
undersigned has been duly authorized by the Partnership to acquire the Shares,
the Partnership has all requisite authority to acquire such Shares, and that the
Partnership was not formed for the purposes of acquiring such Shares.

 

The undersigned represents and warrants that each of the above representations
or agreements or understandings set forth herein has been made by the
Partnership and that he or she is authorized by such Partnership to execute and
deliver this Subscription Agreement. The undersigned has enclosed a true copy of
the Partnership Agreement of said Partnership, as amended to date, together with
a current and complete list of all partners thereof.

 

 

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Name of Partnership (Please type or print)

By:

 

 

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Name:

 

 

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Title:

 

 

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4. If the subscriber is a TRUST, complete the following:

 

The undersigned hereby represents, warrants and covenants that he or she is duly
authorized by the terms of the trust agreement described below (the “Trust
Instrument”) to acquire the Shares and that the undersigned, as trustee, has all
requisite authority to acquire such Shares for the Trust.

 

The undersigned, as trustee, executing this Subscription Agreement on behalf of
the Trust, represents and warrants that each of the above representations or
agreements or understandings set forth herein has been made by the Trust and
that he or she is authorized by such Trust to execute and deliver this
Subscription Agreement. Such trustee has enclosed a true copy of the Trust
Instrument, as amended to date.

 

 

 

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Name of Trust (Please type or print)

By:

 

 

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Name:

 

 

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Title:

 

 

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Accepted by Cheniere Energy, Inc. this          day of January, 2004.

 

CHENIERE ENERGY, INC.

By:

 

 

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Name:

 

 

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Title:

 

 

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