8-KMaterial Agreements

NEXTERA ENERGY INC 8-K Report, Agreement Terminated (Nov 3, 2017)

Filed November 3, 2017For Securities:NEENEE-PNNEE-PSNEE-PTNEE-PWNEE-PVNEE-PU

Summary

NextEra Energy, Inc. (NEE) announced on October 31, 2017, that it received a notice of termination for a previously agreed-upon merger agreement with Texas Transmission Holdings Corporation (TTHC). This agreement, dated October 30, 2016, involved NEE's subsidiary, WSS Acquisition Company, merging with TTHC, which holds a 20 percent interest in Oncor Electric Delivery Company LLC. The termination notice was issued by TTHC and certain primary stockholders, citing specific sections of the merger agreement. TTHC asserts it is owed a $72.3 million termination fee as a result of this action. However, NextEra Energy and its subsidiary dispute the validity of the termination and the claim for the termination fee. The company does not believe the termination is valid under the terms of the agreement, nor that the specified fee is payable. This development represents a significant shift in NEE's potential involvement with Oncor Electric Delivery Company and highlights a material dispute with TTHC regarding contractual obligations and financial penalties.

Key Highlights

  • 1NextEra Energy (NEE) received a notice of termination for its merger agreement with Texas Transmission Holdings Corporation (TTHC).
  • 2The merger agreement, dated October 30, 2016, involved NEE's subsidiary merging with TTHC, an entity with a 20% interest in Oncor Electric Delivery Company LLC.
  • 3TTHC and certain primary stockholders issued the termination notice.
  • 4TTHC claims a termination fee of $72.3 million is due from NEE as a result of the termination.
  • 5NextEra Energy disputes the validity of the termination and the obligation to pay the termination fee.
  • 6The dispute centers on the interpretation and application of specific sections within the merger agreement.

Frequently Asked Questions

This filing is to report that NextEra Energy (NEE) received a notice of termination from Texas Transmission Holdings Corporation (TTHC) regarding a previously announced merger agreement. NEE disputes the validity of this termination and any associated termination fee.

TTHC is claiming a termination fee of $72.3 million. However, NEE disputes this claim, so the immediate financial impact is uncertain and contingent on the resolution of the dispute.

TTHC indirectly owns approximately a 20 percent interest in Oncor Electric Delivery Company LLC. The terminated merger agreement was intended for NEE's subsidiary to merge with TTHC, which would have likely altered the ownership structure or control related to TTHC's stake in Oncor.

NextEra Energy is disputing the validity of the termination and the payment of the termination fee. The company will likely engage in legal or contractual discussions to resolve this dispute. Further filings may be required depending on the outcome.