Debt

9 Months Ended

Sep. 30, 2019

Significant long-term debt issuances and borrowings during the nine months ended September 30, 2019 were as follows:



	Principal Amount			Interest Rate						Maturity Date
	(millions)
FPL:
First mortgage bonds	$	1,400		3.15	%	-	3.99	%		2049
Senior unsecured notes	$	1,000		Variable					^(a)	2022
Gulf - Term loan	$	300		Variable					^(a)	2021
NEECH:
Debentures	$	550		Variable					^(a)	2020 - 2022
Debentures	$	3,500		2.90	%	-	3.50	%		2022 - 2029
Junior subordinated debentures	$	1,188		5.65				%	^(b)	2079
Debentures, related to NEE's equity units	$	1,500		2.10				%		2024
Other borrowings	$	1,200	^(c)	Variable					^(a)	2020 - 2022

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(a)	Variable rate is based on an underlying index plus a specified margin.


(b)	Beginning in May 2029, $500 million will bear interest at a variable rate based on an underlying index plus a specified margin.


(c)	$700 million was repaid in October 2019 with a portion of the proceeds from the NEECH 2.75% debentures discussed below.

In April 2019, NEECH repaid $4.5 billion of borrowings under the short-term term loan agreements that it entered into to finance a portion of the purchase price paid by NEE for the acquisition of Gulf Power. In addition, long-term debt was assumed in connection with the acquisitions of Gulf Power and Trans Bay. See Note 7.

In August 2019, NEECH completed a remarketing of $1.5 billion aggregate principal amount of its Series I Debentures due September 1, 2021 (Series I Debentures) that were issued in August 2016 as components of equity units issued concurrently by NEE (August 2016 equity units). The Series I Debentures are fully and unconditionally guaranteed by NEE. In connection with the remarketing of the Series I Debentures, the interest rate on the Series I Debentures was reset to 2.403% per year, and interest is payable on March 1 and September 1 of each year, commencing September 1, 2019. In connection with the settlement of the contracts to purchase NEE common stock that were issued as components of the August 2016 equity units, in the third quarter of 2019, NEE issued 9,543,000 shares of common stock in exchange for $1.5 billion.

In September 2019, NEE sold $1.5 billion of equity units (initially consisting of Corporate Units). Each equity unit has a stated amount of $50 and consists of a contract to purchase NEE common stock (stock purchase contract) and, initially, a 5% undivided beneficial ownership interest in a Series J Debenture due September 1, 2024, issued in the principal amount of $1,000 by NEECH. Each stock purchase contract requires the holder to purchase by no later than September 1, 2022 (the final settlement date) for a price of $50 in cash, a number of shares of NEE common stock (subject to antidilution adjustments) based on a price per share range of $224.12 to $280.15. If purchased on the final settlement date, as of September 30, 2019, the number of shares issued would (subject to antidilution adjustments) range from 0.2231 shares if the applicable market value of a share of common stock is less than or equal to $224.12 to 0.1785 shares if the applicable market value of a share is equal to or greater than $280.15, with applicable market value to be determined using the average closing prices of NEE common stock over a 20-day trading period ending August 29, 2022. Total annual distributions on the equity units are at the rate of 4.872%, consisting of interest on the debentures (2.10% per year) and payments under the stock purchase contracts (2.772% per year). The interest rate on the debentures is expected to be reset on or after March 1, 2022. A holder of an equity unit may satisfy its purchase obligation with proceeds raised from remarketing the NEECH debentures that are part of its equity unit. The undivided beneficial ownership interest in the NEECH debenture that is a component of each Corporate Unit is pledged to NEE to secure the holder's obligation to purchase NEE common stock under the related stock purchase contract. If a successful remarketing does not occur on or before the third business day prior to the final settlement date, and a holder has not notified NEE of its intention to settle the stock purchase contract with cash, the debentures that are components of the Corporate Units will be used to satisfy in full the holders' obligations to purchase NEE common stock under the related stock purchase contracts on the final settlement date. The debentures are fully and unconditionally guaranteed by NEE.

In October 2019, NEECH sold $1.0 billion principal amount of its 2.75% Debentures, Series due November 1, 2029, which are fully and unconditionally guaranteed by NEE. Also, in October 2019, NEECH sold $450 million principal amount of its 1.95% Debentures, Series due September 1, 2022, which are fully and unconditionally guaranteed by NEE.

During the second and third quarters of 2019, waivers related to events of default under certain financings caused by the bankruptcy filing of a counterparty to several PPAs were received, which, subject to certain conditions, waived the lenders' ability to accelerate the repayment of borrowings thereunder. As of September 30, 2019, all related debt amounts have been reclassified from current to long-term on NEE's condensed consolidated balance sheet.