Summary
NextEra Energy Inc. (NEE), through its subsidiary FPL Group Capital Inc., announced on June 6, 2006, the establishment of three two-year term loan facilities totaling $400 million. The company drew down $250 million on June 8, 2006, and $150 million on June 9, 2006. These borrowings mature in June 2008 and carry variable interest rates. The proceeds are intended for general corporate purposes, indicating flexibility in how the funds will be deployed within the company's operations.
Key Highlights
- 1FPL Group Capital Inc. secured $400 million in new term loan facilities.
- 2The loans are for a two-year term, maturing in June 2008.
- 3Total borrowings amounted to $400 million ($250 million on June 8 and $150 million on June 9, 2006).
- 4Interest rates on the loans are variable.
- 5The borrowings are guaranteed by the parent company, FPL Group, Inc.
- 6The parent company, FPL Group, Inc., must maintain a minimum funded debt to total capitalization ratio.
- 7Proceeds are designated for general corporate purposes.
Frequently Asked Questions
The proceeds from these term loan facilities are intended for general corporate purposes, which can include funding ongoing operations, capital expenditures, or other general business needs of the company.
The principal amounts borrowed under these term loan facilities are due in June 2008, making them two-year loans.
Yes, the loans contain default provisions and covenants. Specifically, FPL Group, Inc. (the parent company) is required to maintain a minimum ratio of funded debt to total capitalization under the terms of these facilities.
While FPL Group Capital Inc. entered into the term loan facilities, FPL Group, Inc. (the parent company) has guaranteed the payment of these loans, meaning the parent company is ultimately responsible for their repayment.