What is the primary purpose of these new credit facilities?

The primary purpose of these new credit facilities is to provide liquidity and financial flexibility for NextEra Energy's subsidiaries. The $500 million facility for Capital Holdings is intended for general corporate purposes, including supporting its commercial paper program. The Canadian facility for the NextEra Energy Resources subsidiary is for general corporate purposes, with a focus on supporting the development and operation of Canadian electricity generating assets.

What are the maturity dates for these credit agreements?

Both the $500 million credit agreement for Capital Holdings and the Canadian $150 million credit agreement for the NextEra Energy Resources subsidiary mature in December 2013. The Canadian facility also has an option for a one-year extension with lender consent.

Are there any conditions or covenants associated with these credit agreements?

Yes, both credit agreements are subject to certain covenants. A key condition is that NextEra Energy, Inc. must maintain a ratio of funded debt to total capitalization at or below a specified level. Failure to meet this ratio, among other conditions, can lead to default and acceleration of the debt.

Has NextEra Energy already borrowed under these new facilities?

Yes, as of December 15, 2010, approximately Canadian $82 million had already been borrowed under the Canadian $150 million revolving credit agreement.

NEXTERA ENERGY INC 8-K: Financial Events

Summary

NextEra Energy, Inc. (NEE) reported in this 8-K filing the execution of two new credit agreements by its subsidiaries. These agreements are designed to provide significant financial flexibility and liquidity. Specifically, NextEra Energy Capital Holdings, Inc. secured a $500 million, three-year revolving credit facility maturing in December 2013, intended for general corporate purposes, including back-up liquidity for its commercial paper program and short-term borrowings. This facility is backed by a guarantee from NextEra Energy, Inc. itself. Additionally, an indirect subsidiary of NextEra Energy Resources, LLC entered into a Canadian $150 million revolving credit agreement, also with a three-year term (expiring December 2013), with an option for a one-year extension and potential conversion to a term loan. This facility will support the borrower's general corporate needs, particularly for the purchase, development, construction, and operation of Canadian electricity generating assets. Both credit agreements are subject to certain financial covenants, primarily related to NextEra Energy's funded debt to total capitalization ratio, and include standard default and acceleration provisions. Notably, Canadian $82 million was already drawn under the Canadian facility as of December 15, 2010.

Key Highlights

1NextEra Energy Capital Holdings, Inc. entered into a new $500 million, three-year bank revolving credit agreement expiring in December 2013.
2The $500 million credit facility is available for Capital Holdings' general corporate purposes, including back-up liquidity for commercial paper and short-term borrowings.
3NextEra Energy, Inc. provides a guarantee for Capital Holdings' debt obligations under the $500 million credit agreement.
4An indirect subsidiary of NextEra Energy Resources, LLC secured a Canadian $150 million, three-year revolving credit agreement expiring in December 2013.
5The Canadian credit facility can be used for general corporate purposes, with a specific focus on Canadian electricity generating asset development and operations.
6Both credit agreements are guaranteed by NextEra Energy, Inc. (directly or indirectly) and are subject to covenants regarding NextEra Energy's funded debt to total capitalization ratio.
7As of December 15, 2010, Canadian $82 million had already been borrowed under the Canadian credit facility.

NEXTERA ENERGY INC 8-K Report, Financial Obligation (Dec 16, 2010)

Summary

Key Highlights

Frequently Asked Questions