AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 8, 2004
REGISTRATION STATEMENT NOS. 333-______, 333-______-01 AND 333-______-02
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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FLORIDA POWER & LIGHT COMPANY FLORIDA 59-0247775
FLORIDA POWER & LIGHT COMPANY TRUST I DELAWARE 20-6218709
FLORIDA POWER & LIGHT COMPANY TRUST II DELAWARE 20-6218713
(Exact name of each registrant as (State or other jurisdiction of (I.R.S. Employer
specified in its charter) incorporation or organization) Identification No.)
----------------
700 Universe Boulevard
Juno Beach, Florida 33408
(561) 694-4000
(Address, including zip code, and telephone number, including area code, of
registrants' principal executive office)
----------------
Dennis P. Coyle, Esq. Thomas R. McGuigan, P.A. Robert J. Reger, Jr., Esq.
General Counsel and Secretary Steel Hector & Davis LLP Thelen Reid & Priest LLP
Florida Power & Light Company 1900 Phillips Point West 875 Third Avenue
700 Universe Boulevard 777 South Flagler Drive New York, New York 10022
Juno Beach, Florida 33408 West Palm Beach, Florida 33401 (212) 603-2000
(561) 694-4000 (561) 650-7200
(Names and addresses, including zip codes, and telephone numbers, including area
codes, of agents for service)
----------------
It is respectfully requested that the Commission also send copies of all
notices, orders and communications to:
Richard L. Harden, Esq.
Hunton & Williams LLP
200 Park Avenue
New York, New York 10166
(212) 309-1000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after the effective date of this registration statement as
determined by market conditions and other factors.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. |_|
CALCULATION OF REGISTRATION FEE
===============================================================================================================================
PROPOSED MAXIMUM AGGREGATE
TITLE OF EACH CLASS OF SECURITIES TO BE REGISTERED OFFERING PRICE (1)(2) AMOUNT OF REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------------------------------
Florida Power & Light Company First Mortgage Bonds
Florida Power & Light Company Guarantee of Florida Power & Light
Company Trust I and Florida Power & Light Company Trust II
Preferred Trust Securities (3)(5) (4)
Florida Power & Light Company Junior Subordinated Debentures (5)(7)
Florida Power & Light Company Trust I and Florida Power & Light
Company Trust II Preferred Trust Securities (5)(7)
Florida Power & Light Company Preferred Stock
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Total $1,000,000,000 (6) $126,700
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(1) The aggregate amount of all such securities or combinations of such
securities offered by Florida Power & Light Company, Florida Power & Light
Company Trust I and Florida Power & Light Company Trust II under this
registration statement may not exceed $1,000,000,000.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(o) under the Securities Act of 1933, as amended (the
"Securities Act").
(3) The value attributable to the Florida Power & Light Company guarantee, if
any, is reflected in the market price of the Florida Power & Light Company
Trust I and Florida Power & Light Company Trust II Preferred Trust
Securities.
(4) Pursuant to Rule 457(n) under the Securities Act, no separate fee for the
Florida Power & Light Company guarantee is payable.
(5) This registration statement is deemed to include the rights of the holders
of the Preferred Trust Securities of Florida Power & Light Company Trust I
and Florida Power & Light Company Trust II under the Junior Subordinated
Debentures, the Subordinated Indenture and the Agreement as to Expenses and
Liabilities, each as described in this registration statement.
(6) If any securities are issued at an original issue discount, then the
aggregate initial offering price as so discounted shall not exceed
$1,000,000,000, notwithstanding that the stated principal amount of such
securities may exceed such amount.
(7) Florida Power & Light Company Junior Subordinated Debentures may be
purchased by Florida Power & Light Company Trust I and/or Florida Power &
Light Company Trust II with the proceeds from the sale of their respective
Preferred Trust Securities. No separate consideration will be received for
the Florida Power & Light Company Junior Subordinated Debentures.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
================================================================================
SUBJECT TO COMPLETION, DATED JUNE 8, 2004
PROSPECTUS
$1,000,000,000
FLORIDA POWER & LIGHT COMPANY
FIRST MORTGAGE BONDS
PREFERRED STOCK
JUNIOR SUBORDINATED DEBENTURES
-------------------------------------
FLORIDA POWER & LIGHT COMPANY TRUST I
FLORIDA POWER & LIGHT COMPANY TRUST II
PREFERRED TRUST SECURITIES
GUARANTEED AS DESCRIBED IN THIS PROSPECTUS BY
FLORIDA POWER & LIGHT COMPANY
-------------------------------------
Each of Florida Power & Light Company, Florida Power & Light Company
Trust I and Florida Power & Light Company Trust II may offer from time to time
up to $1,000,000,000 of securities provided that the aggregate amount of
securities offered by all such issuers may not exceed $1,000,000,000.
Florida Power & Light Company, Florida Power & Light Company Trust I
and Florida Power & Light Company Trust II will provide specific terms of the
securities, including the offering prices, in supplements to this prospectus.
The supplements may also add, update or change information contained in this
prospectus. You should read this prospectus and any supplements carefully before
you invest.
Florida Power & Light Company, Florida Power & Light Company Trust I
and Florida Power & Light Company Trust II may offer these securities directly
or through underwriters, agents or dealers. The supplements to this prospectus
will describe the terms of any particular plan of distribution, including any
underwriting arrangements. The "Plan of Distribution" section beginning on page
39 of this prospectus also provides more information on this topic.
SEE "RISK FACTORS" BEGINNING ON PAGE 2 OF THIS PROSPECTUS TO READ
ABOUT CERTAIN FACTORS YOU SHOULD CONSIDER BEFORE MAKING AN INVESTMENT IN THESE
SECURITIES.
Florida Power & Light Company's, Florida Power & Light Company Trust
I's and Florida Power & Light Company Trust II's principal executive offices are
located at 700 Universe Boulevard, Juno Beach, Florida 33408, telephone number
(561) 694-4000, and their mailing address is P.O. Box 14000, Juno Beach, Florida
33408-0420.
-------------------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
----------, -----
- --------------------------------------------------------------------------------
The information in this prospectus is not complete and may be changed. Florida
Power & Light Company, Florida Power & Light Company Trust I and Florida Power &
Light Company Trust II may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any jurisdiction where the offer or sale is not
permitted.
TABLE OF CONTENTS
Page
----
ABOUT THIS PROSPECTUS..........................................................2
RISK FACTORS...................................................................2
FPL............................................................................4
FLORIDA POWER & LIGHT COMPANY TRUST I AND
FLORIDA POWER & LIGHT COMPANY TRUST II......................................4
USE OF PROCEEDS................................................................5
RATIO OF EARNINGS TO FIXED CHARGES AND
RATIO OF EARNINGS TO FIXED CHARGES PLUS PREFERRED DIVIDENDS.................5
WHERE YOU CAN FIND MORE INFORMATION............................................6
INCORPORATION BY REFERENCE.....................................................6
CAUTIONARY STATEMENTS..........................................................6
DESCRIPTION OF THE BONDS.......................................................7
DESCRIPTION OF PREFERRED STOCK.................................................2
DESCRIPTION OF PREFERRED TRUST SECURITIES.....................................15
DESCRIPTION OF THE PREFERRED TRUST SECURITIES GUARANTEE.......................23
DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES.............................26
INFORMATION CONCERNING THE TRUSTEES...........................................38
PLAN OF DISTRIBUTION..........................................................39
EXPERTS.......................................................................40
LEGAL OPINIONS................................................................40
i
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that Florida Power
& Light Company ("FPL"), Florida Power & Light Company Trust I and Florida Power
& Light Company Trust II have filed with the Securities and Exchange Commission
("SEC") using a "shelf" registration process. Florida Power & Light Company
Trust I and Florida Power & Light Company Trust II are each referred to in this
prospectus as the "Trust."
Under this shelf registration process, FPL may offer from time to
time, in one or more offerings, up to a total of $1,000,000,000 of first
mortgage bonds, junior subordinated debentures and preferred stock and the Trust
may offer from time to time, in one or more offerings, up to a total of
$1,000,000,000 of preferred trust securities, provided that the aggregate amount
of all such securities or combinations of such securities offered by FPL and the
Trust under the registration statement may not exceed $1,000,000,000.
This prospectus provides you with a general description of the
securities that FPL and/or the Trust may offer. Each time FPL and/or the Trust
sells securities, FPL and/or the Trust will provide a prospectus supplement that
will contain specific information about the terms of that offering. The
prospectus supplement may also add, update or change information contained in
this prospectus. You should read both this prospectus and any prospectus
supplement together with additional information described under the headings
"Where You Can Find More Information" and "Incorporation by Reference."
For more detailed information about the securities, you can read the
exhibits to the registration statement. Those exhibits have been either filed
with the registration statement or incorporated by reference to earlier SEC
filings listed in the registration statement.
RISK FACTORS
Before purchasing the securities, investors should carefully consider
the following risk factors together with the other information incorporated by
reference or provided in this prospectus or in a prospectus supplement in order
to evaluate an investment in the securities.
FPL IS SUBJECT TO COMPLEX LAWS AND REGULATIONS AND TO CHANGES IN LAWS AND
REGULATIONS, INCLUDING INITIATIVES REGARDING RESTRUCTURING OF THE ENERGY
INDUSTRY. FPL HOLDS FRANCHISE AGREEMENTS WITH LOCAL MUNICIPALITIES AND COUNTIES,
AND MUST RENEGOTIATE EXPIRING AGREEMENTS. THESE FACTORS MAY HAVE A NEGATIVE
IMPACT ON THE BUSINESS AND RESULTS OF OPERATIONS OF FPL.
FPL is subject to changes in laws or regulations, including the Public
Utility Regulatory Policies Act of 1978 and the Public Utility Holding Company
Act of 1935, changing governmental policies and regulatory actions, including
those of the Federal Energy Regulatory Commission, the Florida Public Service
Commission, and the U.S. Nuclear Regulatory Commission, with respect to, among
other things, allowed rates of return, industry and rate structure, operation of
nuclear power facilities, operation and construction of plant facilities,
operation and construction of transmission facilities, acquisition, disposal,
depreciation and amortization of assets and facilities, recovery of fuel and
purchased power costs, decommissioning costs, return on common equity and equity
ratio limits, and present or prospective wholesale and retail competition
(including but not limited to retail wheeling and transmission costs). The
Florida Public Service Commission has the authority to disallow recovery by FPL
of costs that it considers excessive or imprudently incurred. The regulatory
process generally restricts FPL's ability to grow earnings and does not provide
any assurance as to achievement of earnings levels.
FPL is subject to extensive federal, state and local environmental
statutes, rules and regulations relating to air quality, water quality, waste
management, wildlife mortality, natural resources and health and safety that
could, among other things, restrict or limit the output of certain facilities or
the use of certain fuels required for the production of electricity and/or
increase costs. There are significant capital, operating and other costs
associated with compliance with these environmental statutes, rules and
regulations, and those costs could be even more significant in the future.
2
FPL operates in a changing market environment influenced by various
legislative and regulatory initiatives regarding deregulation, regulation or
restructuring of the energy industry, including deregulation of the production
and sale of electricity. FPL will need to adapt to these changes and may face
increasing competitive pressure.
FPL's results of operations could be affected by its ability to
renegotiate franchise agreements with municipalities and counties in Florida.
THE OPERATION OF POWER GENERATION FACILITIES, INCLUDING NUCLEAR FACILITIES,
INVOLVES SIGNIFICANT RISKS THAT COULD ADVERSELY AFFECT THE RESULTS OF OPERATIONS
AND FINANCIAL CONDITION OF FPL.
The operation of power generation facilities involves many risks,
including start up risks, breakdown or failure of equipment, transmission lines
or pipelines, use of new technology, the dependence on a specific fuel source or
the impact of unusual or adverse weather conditions (including natural disasters
such as hurricanes), as well as the risk of performance below expected or
contracted levels of output or efficiency. This could result in lost revenues
and/or increased expenses. Insurance, warranties or performance guarantees may
not cover any or all of the lost revenues or increased expenses, including the
cost of replacement power. In addition to these risks, FPL's nuclear units face
certain risks that are unique to the nuclear industry including the ability to
dispose of spent nuclear fuel, as well as additional regulatory actions up to
and including shutdown of the units stemming from public safety concerns,
whether at FPL's plants or at the plants of other nuclear operators.
THE CONSTRUCTION OF, AND CAPITAL IMPROVEMENTS TO, POWER GENERATION FACILITIES
INVOLVE SUBSTANTIAL RISKS. SHOULD CONSTRUCTION OR CAPITAL IMPROVEMENT EFFORTS BE
UNSUCCESSFUL, THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION OF FPL COULD BE
NEGATIVELY AFFECTED.
FPL's ability to successfully and timely complete its power generation
facilities currently under construction, those projects yet to begin
construction or capital improvements to existing facilities is contingent upon
many variables and subject to substantial risks. Should any such efforts be
unsuccessful, FPL could be subject to additional costs, termination payments
under committed contracts and/or the write-off of its investment in the project
or improvement.
THE USE OF DERIVATIVE CONTRACTS BY FPL IN THE NORMAL COURSE OF BUSINESS COULD
RESULT IN FINANCIAL LOSSES THAT NEGATIVELY IMPACT THE RESULTS OF OPERATIONS OF
FPL.
FPL uses derivative instruments, such as swaps, options, futures and
forwards to manage its commodity and financial market risks. FPL could recognize
financial losses if a counterparty fails to perform. In the absence of actively
quoted market prices and pricing information from external sources, the
valuation of these derivative instruments involves management's judgment or use
of estimates. As a result, changes in the underlying assumptions or use of
alternative valuation methods could affect the reported fair value of these
contracts. In addition, FPL's use of such instruments could be subject to
prudency challenges and if found imprudent, cost recovery could be disallowed by
the Florida Public Service Commission.
BECAUSE FPL AND FPL GROUP RELY ON ACCESS TO CAPITAL MARKETS, THE INABILITY TO
ACCESS CAPITAL MARKETS ON FAVORABLE TERMS MAY LIMIT THE ABILITY OF FPL TO GROW
ITS BUSINESS AND WOULD LIKELY INCREASE INTEREST COSTS.
FPL as well as FPL Group, Inc., which owns all of the common stock of
FPL, rely on access to capital markets as a significant source of liquidity for
capital requirements not satisfied by operating cash flows. The inability of FPL
and FPL Group to maintain their current credit ratings could affect FPL's
ability to raise capital on favorable terms, particularly during times of
uncertainty in the capital markets which, in turn, could impact FPL's ability to
grow its business and would likely increase its interest costs.
WEATHER CONDITIONS CAN AFFECT FPL'S RESULTS OF OPERATIONS.
FPL's results of operations can be affected by changes in the weather.
Weather conditions directly influence the demand for electricity and natural gas
and affect the price of energy commodities. In addition, severe weather can be
3
destructive, causing outages and/or property damage, which could require
additional costs to be incurred.
FPL IS SUBJECT TO COSTS AND OTHER EFFECTS OF LEGAL PROCEEDINGS, CHANGES IN TAX
AND INFLATION RATES, AND CHANGES IN OR ADDITIONS TO APPLICABLE TAX POLICIES,
RATES OF INFLATION, ACCOUNTING STANDARDS, SECURITIES LAWS AND CORPORATE
GOVERNANCE REQUIREMENTS.
FPL is subject to costs and other effects of legal and administrative
proceedings, settlements, investigations and claims; as well as the effect of
new, or changes in, tax rates or policies, rates of inflation, accounting
standards, securities laws or corporate governance requirements.
THREATS OF TERRORISM AND CATASTROPHIC EVENTS THAT COULD RESULT FROM TERRORISM
MAY IMPACT THE OPERATIONS OF FPL IN UNPREDICTABLE WAYS.
FPL is subject to direct and indirect effects of terrorist threats and
activities. Generation and transmission facilities, in general, have been
identified as potential targets. The effects of terrorist threats and activities
include, among other things, terrorist actions or responses to such actions or
threats, the inability to generate, purchase or transmit power, the risk of a
significant slowdown in growth or a decline in the U.S. economy, delay in
economic recovery in the U.S., and the increased cost and adequacy of security
and insurance.
THE ABILITY OF FPL TO OBTAIN INSURANCE AND THE TERMS OF ANY AVAILABLE INSURANCE
COVERAGE COULD BE AFFECTED BY NATIONAL AND COMPANY-SPECIFIC EVENTS.
FPL's ability to obtain insurance, and the cost of and coverage
provided by such insurance, could be affected by national events as well as
company-specific events.
FPL IS SUBJECT TO EMPLOYEE WORKFORCE FACTORS THAT COULD AFFECT THE BUSINESS AND
FINANCIAL CONDITION OF FPL.
FPL is subject to employee workforce factors, including loss or
retirement of key executives, availability of qualified personnel, collective
bargaining agreements with union employees or work stoppage that could affect
the business and financial condition of FPL.
FPL
FPL was incorporated under the laws of Florida in 1925 and is a
rate-regulated utility engaged in the generation, transmission, distribution and
sale of electric energy. FPL supplies electric service throughout most of the
east and lower west coasts of the State of Florida, serving a population of more
than 8 million. During 2003, FPL served approximately 4.1 million customer
accounts. FPL Group, Inc. owns all of FPL's common stock. FPL Group is a public
utility holding company, as defined in the Public Utility Holding Company Act of
1935. FPL Group is exempt from substantially all of the provisions of the Public
Utility Holding Company Act of 1935.
FLORIDA POWER & LIGHT COMPANY TRUST I AND
FLORIDA POWER & LIGHT COMPANY TRUST II
Florida Power & Light Company Trust I and Florida Power & Light
Company Trust II are Delaware statutory trusts created pursuant to separate
trust agreements among FPL as depositor of the Trust, The Bank of New York as
the Property Trustee, The Bank of New York (Delaware) as the Delaware Trustee
and one or more Administrative Trustees appointed by FPL. The trust agreements
will be amended and restated substantially in the form filed as an exhibit to
the registration statement. Each trust agreement, as so amended and restated, is
referred to in this prospectus as the "Trust Agreement." The Trust exists only
to issue its preferred trust securities and common trust securities and to hold
the junior subordinated debentures of FPL as trust assets. All of the common
trust securities will be owned by FPL. The common trust securities will
represent at least 3% of the total capital of the Trust. Payments on any
distribution payment date or redemption date will be made on the common trust
securities pro rata with the preferred trust securities, except that the common
trust securities' right to payment will be subordinated to the rights of the
4
preferred trust securities if there is a default under the trust agreement. The
Trust has a term of approximately 50 years, but may dissolve earlier as provided
in the Trust Agreement.
The Trust's business and affairs will be conducted by its
Administrative Trustees. The office of the Delaware Trustee in the State of
Delaware is White Clay Center, Route 273, Newark, Delaware 19711. The principal
place of business of the Trust is 700 Universe Boulevard, Juno Beach, Florida
33408, and the telephone number is (561) 694-4000.
USE OF PROCEEDS
Unless otherwise stated in a prospectus supplement, FPL will add the
net proceeds from the sale of its securities to its general funds. FPL uses its
general funds for corporate purposes, including to repay, redeem or purchase
outstanding debt and preferred stock, to repay short-term borrowings and to
finance the acquisition or construction of additional electric facilities and
capital improvements to and maintenance of existing facilities. FPL will
temporarily invest any proceeds that it does not need to use immediately in
short-term instruments.
The Trust will use the proceeds from the sale of preferred trust
securities and common trust securities to invest in junior subordinated
debentures issued by FPL. FPL will add the net proceeds from the sale of such
junior subordinated debentures to its general funds, which will be used as
described above.
RATIO OF EARNINGS TO FIXED CHARGES
AND RATIO OF EARNINGS TO FIXED CHARGES PLUS PREFERRED DIVIDENDS
The following table shows FPL's ratio of earnings to fixed charges for
each of its last five fiscal years:
Years Ended December 31,
------------------------
2003 2002 2001 2000 1999
------ ------ ------ ------ ------
7.23 7.47 6.44 6.02 6.26
The following table shows FPL's ratio of earnings to combined fixed
charges and preferred stock dividends for each of its last five fiscal years:
Years Ended December 31,
------------------------
2003 2002 2001 2000 1999
------ ------ ------ ------ ------
6.52 6.61 5.77 5.37 5.53
FPL's ratio of earnings to fixed charges and ratio of earnings to
combined fixed charges and preferred stock dividends for the three months ended
March 31, 2004 was 4.14.
5
WHERE YOU CAN FIND MORE INFORMATION
FPL files annual, quarterly and other reports and other information
with the SEC. You can read and copy any information filed by FPL with the SEC at
the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. You can obtain additional information about the Public Reference Room by
calling the SEC at 1-800-SEC-0330.
In addition, the SEC maintains an Internet site (http://www.sec.gov)
that contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC, including FPL. FPL also
maintains an Internet site (http://www.fpl.com).
No separate financial statements of the Trust are included in this
prospectus. FPL and the Trust do not consider those financial statements to be
material to holders of the preferred trust securities because (1) the Trust is a
newly formed special purpose entity and has no operating history or independent
operations, and (2) the Trust is not engaged in and does not propose to engage
in any activity other than holding as trust assets the junior subordinated
debentures of FPL and issuing its preferred trust securities and common trust
securities. FPL and the Trust do not expect the Trust to file periodic reports
under Sections 13 or 15(d) of the Securities Exchange Act of 1934.
INCORPORATION BY REFERENCE
The SEC allows FPL and the Trust to "incorporate by reference" the
information that FPL files with the SEC, which means that FPL and the Trust may,
in this prospectus, disclose important information to you by referring you to
those documents. The information incorporated by reference is an important part
of this prospectus. Information that FPL files in the future with the SEC will
automatically update and supersede this information. FPL and the Trust are
incorporating by reference the documents listed below and any future filings FPL
makes with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 between the date of the initial filing of the registration
statement of which this prospectus is a part and the effectiveness of that
registration statement, as well as after the date of this prospectus, until FPL
and/or the Trust sell all of these securities:
(1) FPL's Annual Report on Form 10-K for the year ended December 31, 2003;
(2) FPL's Quarterly Report on Form 10-Q for the quarter ended March 31,
2004; and
(3) FPL's Current Report on Form 8-K filed with the SEC on March 1, 2004.
You may request a copy of these documents, at no cost to you, by
writing or calling Robert J. Reger, Jr., Esq., Thelen Reid & Priest LLP, 875
Third Avenue, New York, New York, 10022, (212) 603-2000. FPL will provide to
each person, including any beneficial owner, to whom this prospectus is
delivered, a copy of any or all of the information that has been incorporated by
reference in this prospectus but not delivered with this prospectus.
CAUTIONARY STATEMENTS
In connection with the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, FPL and the Trust are hereby filing
cautionary statements identifying important factors that could cause FPL's
actual results to differ materially from those projected in forward-looking
statements (as such term is defined in the Private Securities Litigation Reform
Act of 1995) made by or on behalf of FPL and the Trust in this prospectus or any
supplement to this prospectus, in presentations, in response to questions or
otherwise. Any statements that express, or involve discussions as to
expectations, beliefs, plans, objectives, assumptions or future events or
performance (often, but not always, through the use of words or phrases such as
"will likely result," "are expected to," "will continue," "is anticipated,"
"believe," "could," "estimated," "may," "plan," "potential," "projection,"
"target," "outlook") are not statements of historical facts and may be
forward-looking. Forward-looking statements involve estimates, assumptions and
uncertainties. Accordingly, any such statements are qualified in their entirety
by reference to, and are accompanied by, the specific factors discussed in "Risk
Factors" herein and in the reports that are incorporated herein by reference (in
addition to any assumptions and other factors referred to specifically in
6
connection with such forward-looking statements) that could cause FPL's actual
results to differ materially from those contained in forward-looking statements
made by or on behalf of FPL or the Trust.
Any forward-looking statement speaks only as of the date on which that
statement is made, and neither FPL nor the Trust undertakes any obligation to
update any forward-looking statement to reflect events or circumstances after
the date on which that statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time and it is not
possible for management to predict all of those factors, nor can it assess the
impact of each of those factors on the business or the extent to which any
factor, or combination of factors, may cause actual results to differ materially
from those contained in any forward-looking statement.
The issues and associated risks and uncertainties discussed in "Risk
Factors" herein and in the reports that are incorporated by reference herein are
not the only ones FPL may face. Additional issues may arise or become material
as the energy industry evolves. The risks and uncertainties associated with
those additional issues could impair FPL's business in the future.
DESCRIPTION OF THE BONDS
GENERAL. FPL will issue these first mortgage bonds, in one or more
series, under its Mortgage and Deed of Trust dated as of January 1, 1944, with
Deutsche Bank Trust Company Americas, as Trustee, which has been amended and
supplemented in the past, may be supplemented prior to the issuance of these
first mortgage bonds, and which will be supplemented again by one or more
supplemental indentures relating to these first mortgage bonds. This Mortgage
and Deed of Trust, as amended and supplemented, is referred to in this
prospectus as the "Mortgage." These first mortgage bonds are referred to in this
prospectus as the "Bonds." All first mortgage bonds issued or to be issued under
the Mortgage, including the Bonds, are referred to herein as "First Mortgage
Bonds."
This section briefly summarizes some of the terms of the Bonds and
some of the provisions of the Mortgage and uses some terms that are not defined
in this prospectus but that are defined in the Mortgage. This summary is not
complete. You should read this summary together with the Mortgage and the
supplemental indenture establishing the Bonds for a complete understanding of
all the provisions. The Mortgage and the form of supplemental indenture have
been previously filed with the SEC, and are exhibits to the registration
statement filed with the SEC of which this prospectus is a part. In addition,
the Mortgage is qualified as an indenture under the Trust Indenture Act of 1939
and is therefore subject to the provisions of the Trust Indenture Act of 1939.
You should read the Trust Indenture Act of 1939 for a complete understanding of
its provisions.
Each series of Bonds may have different terms. FPL will include some
or all of the following information about a specific series of Bonds in the
prospectus supplement relating to those Bonds:
(1) the designation and series of those Bonds,
(2) the aggregate principal amount of those Bonds,
(3) the offering price of those Bonds,
(4) the date(s) on which those Bonds will mature,
(5) the interest rate(s) for those Bonds, or how the interest rate(s) will
be determined,
(6) the dates on which FPL will pay the interest on those Bonds,
(7) the denominations in which FPL may issue those Bonds, if other than
denominations of $1,000 or multiples of $1,000,
(8) the place where the principal of and interest on those Bonds will be
payable, if other than at Deutsche Bank Trust Company Americas in New
York City,
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(9) the currency or currencies in which payment of the principal of and
interest on those Bonds may be made, if other than U.S. dollars,
(10) the terms pursuant to which FPL may redeem any of those Bonds,
(11) whether all or a portion of those Bonds will be in global form, and
(12) any other terms or provisions relating to those Bonds that are not
inconsistent with the provisions of the Mortgage.
FPL will issue the Bonds in fully registered form without coupons,
unless otherwise stated in a prospectus supplement. A holder of Bonds may
exchange those Bonds, without charge, for an equal aggregate principal amount of
Bonds of the same series, having the same issue date and with identical terms
and provisions, unless otherwise stated in a prospectus supplement. A holder of
Bonds may transfer those Bonds without cost to the holder, other than for
applicable stamp taxes or other governmental charges, unless otherwise stated in
a prospectus supplement. FPL may issue all or some of the Bonds in "book-entry"
form, which means that they will be represented by global notes, instead of
certificates. If FPL issues global notes representing any Bonds, then a
depository selected by FPL will keep a record of the beneficial interests in
those global notes and record any transfers of those beneficial interests and
the depository, or its custodian, will hold those global notes. Any additional
requirements as to the form and method of exchange of Bonds will be described in
a prospectus supplement.
SPECIAL PROVISIONS FOR RETIREMENT OF BONDS. If, during any 12 month
period, any governmental body orders FPL to dispose of mortgaged property, or
buys mortgaged property from FPL, and FPL receives $10 million or more from the
sale or disposition, then, in most cases, FPL must use that money to redeem
First Mortgage Bonds. If this occurs, FPL may redeem First Mortgage Bonds of any
series that are redeemable at the redemption prices applicable to those First
Mortgage Bonds. If any Bonds are redeemable, the redemption prices applicable to
those Bonds will be set forth in a prospectus supplement.
SECURITY. The Mortgage secures the Bonds as well as all other First
Mortgage Bonds already issued under the Mortgage and still outstanding. FPL may
issue more First Mortgage Bonds in the future and those First Mortgage Bonds
will also be secured by the Mortgage. The Mortgage constitutes a first mortgage
lien on all of the properties and franchises that FPL owns, except as discussed
below.
The lien of the Mortgage is or may be subject to the following:
(1) leases of minor portions of FPL's property to others for uses that do
not interfere with FPL's business,
(2) leases of certain property that is not used in FPL's electric
business,
(3) Excepted Encumbrances, which include certain tax and real estate
liens, and specified rights, easements, restrictions and other
obligations, and
(4) vendors' liens, purchase money mortgages and liens on property that
already exist at the time FPL acquires that property.
The Mortgage does not create a lien on the following "excepted
property":
(1) cash and securities,
(2) certain equipment, materials or supplies and fuel (including nuclear
fuel unless it is expressly subjected to the lien of the Mortgage),
(3) automobiles and other vehicles,
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(4) receivables, contracts, leases and operating agreements,
(5) materials or products, including electric energy, that FPL generates,
produces or purchases for sale or use by FPL, and
(6) timber, minerals, mineral rights and royalties.
The Mortgage will generally also create a lien on property that FPL
acquires after the date of this prospectus, other than "excepted property."
However, if FPL consolidates or merges with, or sells substantially all of its
assets to, another corporation, the lien created by the Mortgage will generally
not cover the property of the successor company, other than the property that it
acquires from FPL and improvements, replacements and additions to that property.
The Mortgage provides that the Trustee has a lien on the mortgaged
property for the payment of its reasonable compensation and expenses and for
indemnity against certain liabilities. This lien takes priority over the lien
securing the Bonds.
ISSUANCE OF ADDITIONAL BONDS. FPL may issue an unlimited amount of
First Mortgage Bonds under the Mortgage so long as it meets the issuance tests
set forth in the Mortgage, which are generally described below. FPL may issue
Bonds from time to time in an amount equal to:
(1) 60% of unfunded Property Additions after adjustments to offset
retirements,
(2) the amount of retired First Mortgage Bonds or Qualified Lien Bonds,
and
(3) the amount of cash that FPL deposits with the Trustee.
Property Additions generally include the following:
(1) plants, lines, pipes, mains, cables, machinery, boilers, transmission
lines, pipe lines, distribution systems, service systems and supply
systems,
(2) nuclear fuel that has been expressly subjected to the lien of the
Mortgage,
(3) railroad cars, barges and other transportation equipment (other than
trucks) for the transportation of fuel, and
(4) other property, real or personal, and improvements, extensions,
additions, renewals or replacements located within the United States
of America or its coastal waters.
FPL may use any property of the type described in (1) through (4)
above as Property Additions whether or not that property is in operation and
prior to obtaining permits or licenses relating to that property. Securities,
fuel (including nuclear fuel unless expressly subjected to the lien of the
Mortgage), automobiles or other vehicles, or property used principally for the
production or gathering of natural gas will not qualify as Property Additions.
The Mortgage contains restrictions on the issuance of First Mortgage Bonds based
on Property Additions that are subject to other liens and upon the increase of
the amount of those liens.
In most cases, FPL may not issue Bonds unless it meets the "net
earnings" test set forth in the Mortgage, which requires, generally, that FPL's
adjusted net earnings (before income taxes) for 12 consecutive months out of the
15 months preceding the issuance must have been either:
(1) at least twice the annual interest requirements on all First Mortgage
Bonds at the time outstanding, including the Bonds that FPL proposes
to issue at the time, and all indebtedness of FPL that ranks prior or
equal to the First Mortgage Bonds, or
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(2) at least 10% of the principal amount of all First Mortgage Bonds at
the time outstanding, including the Bonds that FPL proposes to issue
at the time, and all indebtedness of FPL that ranks prior or equal to
the First Mortgage Bonds.
The Mortgage requires FPL to replace obsolete or worn out property and
specifies certain deductions to FPL's adjusted net earnings for property
repairs, retirement, additions and maintenance. With certain exceptions, FPL
does not need to meet the "net earnings" test to issue Bonds if the issuance is
based on retired First Mortgage Bonds or Qualified Lien Bonds.
As of March 31, 2004, FPL could have issued under the Mortgage in
excess of $4.5 billion of additional First Mortgage Bonds based on unfunded
Property Additions and in excess of $5.5 billion of additional First Mortgage
Bonds based on retired First Mortgage Bonds.
RELEASE AND SUBSTITUTION OF PROPERTY. FPL may release property from
the lien of the Mortgage if it does any of the following in an aggregate amount
equal to the fair value of the property to be released:
(1) deposits with the Trustee, cash or, to a limited extent, purchase
money mortgages,
(2) uses unfunded Property Additions acquired by FPL in the last five
years, or
(3) waives its right to issue First Mortgage Bonds
in each case without satisfying any net earnings requirement.
If FPL deposits cash so that it may release property from the lien of
the Mortgage or so that it may issue additional First Mortgage Bonds, it may
withdraw that cash if it uses unfunded Property Additions or waives its right to
issue First Mortgage Bonds without satisfying any net earnings requirement in an
amount equal to the cash that FPL seeks to withdraw.
When property released from the lien of the Mortgage is not Funded
Property, then, if FPL acquires new Property Additions within two years:
(1) Property Additions used for the release of that property will not
(subject to some exceptions) be considered Funded Property, and
(2) any waiver by FPL of its right to issue First Mortgage Bonds, which is
used for the release of that property, will cease to be an effective
waiver and FPL will regain the right to issue those First Mortgage
Bonds.
The Mortgage contains provisions relating to cash proceeds of property
that is not Funded Property that are similar to the provisions relating to
release of that property. The Mortgage contains special provisions relating to
pledged Qualified Lien Bonds and the disposition of money received on those
Qualified Lien Bonds.
FPL does not need a release from the Mortgage in order to use its
nuclear fuel even if that nuclear fuel has been expressly subjected to the lien
and operation of the Mortgage.
DIVIDEND RESTRICTIONS. In some cases, the Mortgage restricts the
amount of retained earnings that FPL can use to pay cash dividends on its common
stock. The restricted amount may change depending on factors set out in the
Mortgage. Other than this restriction on the payment of common stock dividends,
the Mortgage does not restrict FPL's use of retained earnings. As of March 31,
2004, no retained earnings were restricted by these provisions of the Mortgage.
MODIFICATION OF THE MORTGAGE. Generally the rights of all of the
holders of First Mortgage Bonds may be modified with the consent of the holders
of 66-2/3% of the principal amount of all of the outstanding First Mortgage
Bonds. However, if less than all series of First Mortgage Bonds are affected by
a modification, that modification also requires the consent of the holders of
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66-2/3% of the principal amount of all of the outstanding First Mortgage Bonds
of each series affected.
FPL has reserved the right to amend the Mortgage without the consent
of the holders of any series of First Mortgage Bonds created after April 30,
1992 (including the Bonds) to permit modification of the Mortgage generally with
the consent of the holders of only a majority of the First Mortgage Bonds
affected by the modification. Since all of the First Mortgage Bonds issued on or
prior to April 30, 1992 have matured or have been redeemed and are no longer
outstanding under the Mortgage, FPL may exercise this right to amend the
Mortgage at any time.
In most cases, the following modifications will not be effective
against any holder of First Mortgage Bonds affected by the modification unless
that holder consents:
(1) modification of the terms of payment of principal and interest payable
to that holder,
(2) modification creating an equal or prior lien on the mortgaged property
or depriving that holder of the benefit of the lien of the Mortgage,
and
(3) modification reducing the percentage vote required for modification
(except as described above).
DEFAULT AND NOTICE THEREOF. The following are defaults under the
Mortgage:
(1) failure to pay the principal of any First Mortgage Bond,
(2) failure to pay interest on any First Mortgage Bond for 60 days after
that interest is due,
(3) failure to pay principal of or interest on any Qualified Lien Bond
beyond any applicable grace period for the payment of that principal
or interest,
(4) failure to pay any installments of funds for retirement of First
Mortgage Bonds for 60 days after that installment is due,
(5) certain events in bankruptcy, insolvency or reorganization, and
(6) the expiration of 90 days following notice by the Trustee or the
holders of 15% of the First Mortgage Bonds relating to other covenants
of FPL.
Except in the case of failure to pay principal, interest or any
installment for retirement of First Mortgage Bonds, the Trustee may withhold
notice of default if it believes that withholding the notice is in the interests
of the holders of First Mortgage Bonds.
Holders of 25% of the First Mortgage Bonds may declare the principal
and the interest due on default. A majority of the holders of First Mortgage
Bonds may annul that declaration if the default has been cured. No holder of
First Mortgage Bonds may enforce the lien of the Mortgage unless the following
things have occurred:
(1) the holder has given the Trustee written notice of a default,
(2) the holders of 25% of the First Mortgage Bonds have requested the
Trustee to act and offered it reasonable opportunity to act and
indemnity satisfactory to the Trustee for the costs, expenses and
liabilities that the Trustee may incur by acting, and
(3) the Trustee has failed to act.
Notwithstanding the foregoing, a holder of First Mortgage Bonds has
the right to sue FPL if FPL fails to pay, when due, interest or principal on
those First Mortgage Bonds, unless that holder gives up that right.
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The Trustee is not required to risk its funds or incur personal
liability if there is reasonable ground for believing that the repayment is not
reasonably assured. The holders of a majority of the First Mortgage Bonds may
direct the time, method, and place of conducting any proceedings for any remedy
available to the Trustee, or exercising any of the Trustee's powers.
SATISFACTION AND DISCHARGE OF MORTGAGE. The Mortgage may be satisfied
and discharged if and when FPL provides for the payment of all of the First
Mortgage Bonds and all other sums due under the Mortgage.
EVIDENCE TO BE FURNISHED TO THE TRUSTEE. FPL furnishes written
statements of FPL's officers, or persons selected or paid by FPL, annually (and
when certain events occur) to the Trustee to show that FPL is in compliance with
Mortgage provisions and that there are no defaults under the Mortgage. In some
cases, these written statements must be provided by an independent accountant,
appraiser, engineer or counsel.
DESCRIPTION OF PREFERRED STOCK
GENERAL. The following statements describing FPL's preferred stock are
not intended to be a complete description but rather are a summary of certain
preferences, privileges, restrictions and distinguishing characteristics
relating to the preferred stock currently authorized by FPL's Restated Articles
of Incorporation, as amended ("Charter"). For additional information, please see
FPL's Charter and its bylaws. Each of these documents has been previously filed
with the SEC and each is an exhibit to the registration statement filed with the
SEC of which this prospectus is a part. You should read this summary together
with the articles of amendment to FPL's Charter which will describe the terms of
any preferred stock offered hereby for a complete understanding of all the
provisions. Reference is also made to the laws of the State of Florida.
FPL's Charter authorizes four classes of preferred stock. Shares of
two of such classes are presently outstanding: 4 1/2% Preferred Stock Series A,
$100 par value per share ("Series A Preferred Stock") and Preferred Stock, $100
par value per share ("Serial Preferred Stock"). The preferred stock offered
hereby will be one or more new series of FPL's Serial Preferred Stock and/or one
or more new series of FPL's Preferred Stock, without par value ("No Par
Preferred Stock"). Currently, 50,000 shares of the Series A Preferred Stock and
200,000 shares of the Serial Preferred Stock are outstanding. The shares of the
Serial Preferred Stock outstanding are owned by FPL Group. Under the Charter,
10,414,000 shares of Serial Preferred Stock and 5,000,000 shares of No Par
Preferred Stock are available for issuance. FPL's Charter also authorizes the
issuance of 5,000,000 shares of Subordinated Preferred Stock, without par value
("Preference Stock"), none of which are currently outstanding. References in
this "Description of Preferred Stock" section of this prospectus to preferred
stock do not include the Preference Stock.
Some terms of a series of preferred stock may differ from those of
another series. A prospectus supplement will describe the terms of any preferred
stock being offered. These terms will also be described in articles of amendment
to FPL's Charter, which will establish the terms of the preferred stock being
offered. These terms will include any of the following that apply to that
series:
(1) the class of preferred stock, the number of shares in the series and
the title of that series of preferred stock,
(2) the annual rate or rates of dividends payable and the date from which
such dividends shall commence to accrue,
(3) the terms and conditions, including the redemption price and the date
or dates, on which the shares of the series of preferred stock may be
redeemed or converted into another class of security, the manner of
effecting such redemption and any restrictions on such redemptions,
(4) any sinking fund or other provisions that would obligate FPL to redeem
or repurchase shares of the series of preferred stock, and
(5) with respect to the No Par Preferred Stock only, variations with
respect to whole or fractional voting rights and involuntary
liquidation values.
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VOTING RIGHTS. FPL Group, as the owner of all of FPL's common stock,
has sole voting power, except as indicated below or as otherwise required by
law. The Charter does not limit the right of any affiliate of FPL to vote any
shares of preferred stock owned by it. Subject to any rights which might be
given to holders of Preference Stock, if any four full quarterly dividends on
any of the outstanding preferred stock are in default, the holders of the
outstanding preferred stock become entitled, as one class, to elect a majority
of the Board of Directors, which right does not terminate until full dividends
have been provided for all past periods. No dividends on FPL preferred stock are
currently in default. When entitled to vote, the holders of the preferred stock,
other than the No Par Preferred Stock, shall have one vote for each share held
and the holders of No Par Preferred Stock shall have one vote for every $100
liquidation value established for such shares, provided that amounts less than
$100 shall be afforded their proportional fractional vote.
So long as any shares of the Series A Preferred Stock or Serial
Preferred Stock are outstanding, FPL shall not, without the consent of at least
two-thirds of the total number of (a) shares of the Series A Preferred Stock
then outstanding and (b) each series of shares of the Serial Preferred Stock
then outstanding,
(1) create or authorize any new stock ranking prior to such preferred
stock as to dividends, or in liquidation, dissolution, winding up or
other distribution, or create or authorize any security convertible
into shares of such prior ranking stock, or
(2) amend, alter, change or repeal any of the express terms of such
preferred stock in a manner substantially prejudicial to the holders
thereof,
provided that if any such amendment affects less than all of the aforementioned
classes or series of preferred stock then only the consent of two-thirds of the
shares of each such class or series so affected is required.
So long as any shares of the No Par Preferred Stock are outstanding,
FPL shall not, without the consent of at least two-thirds of the total number of
votes attributable to the outstanding shares of the No Par Value Preferred Stock
and all other preferred stock ranking on a parity as to dividends or
distributions (including the Series A Preferred Stock and the Serial Preferred
Stock), voting together as one class,
(1) create or authorize any new stock ranking prior to the No Par
Preferred Stock as to dividends or in liquidation, dissolution,
winding up or other distribution or any security convertible into
shares of such prior ranking stock, or
(2) amend, alter or repeal any of the rights, preferences or powers of any
series of outstanding No Par Preferred Stock so as to alter materially
any such rights, preferences or power,
provided that with respect to (2) above,
(1) the preferred stock other than the No Par Preferred Stock shall be
entitled to vote as a member of such voting class only if the same
right, preference or power of such preferred stock other than the No
Par Preferred Stock are proposed to be materially amended, altered or
repealed in substantially the same manner, and
(2) if any amendment, alteration or repeal would alter materially the
rights, preferences or powers of less than all the series of the No
Par Preferred Stock or such other preferred stock, the consent of only
the holders of at least two-thirds of the total number of votes
attributable to the outstanding shares of all series so affected,
voting as a class, shall be required.
Without the consent of the holders of at least (i) a majority of the
outstanding shares of the Series A Preferred Stock, (ii) a majority of the
outstanding shares of each series of the Serial Preferred Stock and (iii) a
majority of the total number of votes attributable to the outstanding shares of
No Par Preferred Stock and all other preferred stock ranking on a parity with
the No Par Preferred Stock as to dividends or distributions, voting together as
a class, FPL shall not
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(1) merge or consolidate with or into any other corporation or sell or
otherwise dispose of all or substantially all of the assets of FPL,
unless the merger, consolidation or disposition or the exchange,
issuance or assumption of all securities to be issued or assumed in
connection with any such merger or consolidation or other disposition
shall have been approved, ordered or permitted by the appropriate
governmental regulatory bodies;
(2) issue, assume or incur, for purposes other than (a) the refunding of
outstanding unsecured indebtedness; (b) the reacquisition, redemption
or other retirement of any indebtedness issued or assumed by FPL; or
(c) the reacquisition, redemption or other retirement of all
outstanding shares of FPL's outstanding preferred stock and all
outstanding shares of any other class or series of stock ranking on a
parity with the outstanding preferred stock, any unsecured
indebtedness if, immediately thereafter, the total principal amount of
all unsecured indebtedness would exceed 20% of the secured
indebtedness issued or assumed by FPL plus the capital and surplus of
FPL;
(3) issue any shares of preferred stock, or of any other class of stock
ranking prior to or on parity with the outstanding preferred stock as
to dividends or distributions, unless
(a) FPL's net income (after depreciation and taxes) for a period of
twelve consecutive months within the fifteen months immediately
preceding the issuance of such shares is at least equal to twice
the annual dividend requirements on all outstanding shares of
preferred stock, the shares proposed to be issued , and on all
other prior or parity stock; and
(b) FPL's gross income (after depreciation and taxes) for the same
period shall have been at least 1.5 times the sum of annual
interest charges on all indebtedness and annual dividend
requirements on the outstanding preferred stock, the shares
proposed to be issued, and on all other prior or parity stock;
provided, that (i) interest charges on all indebtedness and dividends
of all shares of stock which are to be retired in connection with the
issuance of additional shares shall be excluded from such computation
and (ii) in the event additional shares are to be issued in connection
with the acquisition of new property, the gross income and the net
income of the acquired property may be included in such computation on
a pro forma basis, or
(4) issue any additional shares of the outstanding preferred stock or of
any prior or parity stock unless the aggregate of FPL's common stock
capital and surplus shall be not less than the aggregate amount
payable on the involuntary liquidation, dissolution or winding up of
FPL in respect of such preferred stock, and other prior or parity
stock, to be outstanding immediately thereafter.
LIQUIDATION RIGHTS. In the event of any voluntary liquidation,
dissolution or winding up of FPL, the Series A Preferred Stock, Serial Preferred
Stock and No Par Preferred Stock will rank pari passu with all classes of
preferred stock then outstanding and shall have a preference over each series of
the Preference Stock (none of which has been issued or is currently outstanding)
and the common stock until an amount equal to the then current redemption price
shall have been paid. In the event of any involuntary liquidation, dissolution
or winding up of FPL,
(1) the Series A Preferred Stock and the Serial Preferred Stock will rank
pari passu with all classes of preferred stock then outstanding and
shall also have a preference over each series of the Preference Stock
and the common stock until $100 per share shall have been paid, and
(2) the No Par Preferred Stock will rank pari passu with all classes of
FPL's preferred stock then outstanding and shall also have a
preference over each series of Preference Stock and the common stock
until the full involuntary liquidation value thereof, as established
upon issuance of the applicable series of No Par Preferred Stock,
shall have been paid,
in each case, plus all accumulated and unpaid dividends thereon, if any.
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CHANGES TO TERMS OF PREFERRED STOCK. In the event FPL redeems the
shares of Series A Preferred Stock and Serial Preferred Stock which are
currently outstanding, all of which shares are currently redeemable according to
their terms, FPL may amend the Charter to change many of the provisions
discussed above, including voting and liquidation rights, related to the
preferred stock. Such amendments could also be made with the consent of FPL
Group, as the holder of the outstanding Serial Preferred Stock, if FPL has
redeemed the shares of Series A Preferred Stock. In such an event, any changes
to the terms of the Serial Preferred Stock and the No Par Preferred Stock will
be described in a prospectus supplement relating to any preferred stock being
offered.
DESCRIPTION OF PREFERRED TRUST SECURITIES
GENERAL. The Trust may issue preferred trust securities and common
trust securities under the Trust Agreement. The terms of the agreements pursuant
to which the Preferred Trust Securities of the Trust will be issued are
substantially the same; each of these agreements is referred to in this
prospectus as the "Trust Agreement." These preferred trust securities and common
trust securities issued by the Trust are referred to in this prospectus as
"Preferred Trust Securities" and "Common Trust Securities," respectively, and
collectively as "Trust Securities." These Trust Securities will represent
undivided beneficial interests in the assets of the Trust. The junior
subordinated debentures issued by FPL and held by the Trust are referred to in
this prospectus as the "Junior Subordinated Debentures." This section briefly
summarizes some of the provisions of the Trust Agreement. This summary does not
contain a complete description of the Trust Agreement. You should read this
summary together with the Trust Agreement for a complete understanding of all
the provisions. The form of the Trust Agreement has been previously filed with
the SEC and is an exhibit to the registration statement filed with the SEC of
which this prospectus is a part. In addition, each Trust Agreement will be
qualified as an indenture under the Trust Indenture Act of 1939 and is therefore
subject to the provisions of the Trust Indenture Act of 1939. You should read
the Trust Indenture Act of 1939 for a complete understanding of its provisions.
In this section, any discussion of the Trust, Preferred Trust
Securities and Common Trust Securities relate only to the applicable Trust.
Holders of Preferred Trust Securities of the Trust will be entitled to any of
the benefits and protections contained in the Trust Agreement applicable to the
particular Trust which issued the relevant Trust Securities and not with respect
to any other Trust.
The Preferred Trust Securities and Common Trust Securities issued by
the Trust will be substantially the same except that, if there is an event of
default under the Trust Agreement, as described below, that results from an
event of default under the Subordinated Indenture (as such term is defined below
under "Description of the Junior Subordinated Debentures--General"), the right
of FPL, as holder of the Common Trust Securities, to payment of distributions
and upon liquidation or redemption will be subordinated to the rights of the
holders of the Preferred Trust Securities. (Trust Agreement, Section 4.03). All
of the Common Trust Securities will be owned by FPL. (Trust Agreement, Section
5.10).
FPL will fully and unconditionally guarantee payments due on the
Preferred Trust Securities issued by the Trust through a combination of the
following:
(1) FPL's obligations under the Junior Subordinated Debentures;
(2) the rights of holders of Preferred Trust Securities to enforce those
obligations;
(3) FPL's agreement to pay the expenses of the Trust; and
(4) FPL's guarantee of payments due on the Preferred Trust Securities to
the extent of the Trust's legally available assets (referred to in
this prospectus as the "Preferred Trust Securities Guarantee").
No single one of the documents listed above standing alone or
operating in conjunction with fewer than all of the other documents constitutes
the guarantee by FPL. It is only the combined operation of these documents that
has the effect of providing a full and unconditional, but subordinated,
guarantee as to payment by FPL of the Preferred Trust Securities.
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The Trust will use the proceeds from the sale of the Trust Securities
to purchase Junior Subordinated Debentures from FPL. (Trust Agreement, Section
2.05). The Junior Subordinated Debentures will be issued under a Subordinated
Indenture between FPL and The Bank of New York, as trustee. The Junior
Subordinated Debentures will be held in trust for the benefit of holders of the
applicable Preferred Trust Securities and Common Trust Securities. (Trust
Agreement, Section 2.09).
A prospectus supplement relating to the Preferred Trust Securities
will include specific terms of those securities and of the Junior Subordinated
Debentures. Material United States federal income tax considerations applicable
to the Preferred Trust Securities will also be discussed in the related
prospectus supplement. For a description of some specific terms that will affect
both the Preferred Trust Securities and the Junior Subordinated Debentures, and
holders' rights under each, see "Description of the Junior Subordinated
Debentures" below.
DISTRIBUTIONS. The only income of the Trust available for distribution
to the holders of Preferred Trust Securities will be payments on the applicable
Junior Subordinated Debentures. (Trust Agreement, Section 8.01). If FPL does not
make interest payments on the Junior Subordinated Debentures, the Trust will not
have funds available to pay distributions on Preferred Trust Securities. The
payment of distributions, if and to the extent the Trust has sufficient funds
available for the payment of such distributions, is guaranteed on a limited
basis by FPL as described under "Description of the Preferred Trust Securities
Guarantee."
So long as no event of default under the Subordinated Indenture has
occurred and is continuing, FPL may extend the interest payment period from time
to time on the Junior Subordinated Debentures for one or more periods.
(Subordinated Indenture, Section 312). As a consequence, distributions on
Preferred Trust Securities would be deferred during any such period. Interest
would, however, continue to accrue. (Trust Agreement, Section 4.01). During any
extended interest period, or for so long as an "Event of Default" under the
Subordinated Indenture resulting from a payment default or any payment default
under the Preferred Trust Securities Guarantee has occurred and is continuing,
FPL may not:
(1) declare or pay any dividend or distribution on its capital stock;
(2) redeem, purchase, acquire or make a liquidation payment with respect
to any of its capital stock;
(3) pay any principal, interest or premium on, or repay, repurchase or
redeem any debt securities that are equal or junior in right of
payment with the Junior Subordinated Debentures; or
(4) make any payments with respect to any guarantee of debt securities if
such guarantee is equal or junior in right of payment to the Junior
Subordinated Debentures,
other than
(1) purchases, redemptions or other acquisitions of its capital stock in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of employees, officers, directors
or agents or a stock purchase or dividend reinvestment plan, or the
satisfaction of its obligations pursuant to any contract or security
outstanding on the date that the interest payment period is extended
requiring it to purchase, redeem or acquire its capital stock;
(2) any payment, repayment, redemption, purchase, acquisition or
declaration of dividend described in clauses (1) and (2) above as a
result of a reclassification of its capital stock or the exchange or
conversion of all or a portion of one class or series of its capital
stock for another class or series of its capital stock;
(3) the purchase of fractional interests in shares of its capital stock
pursuant to the conversion or exchange provisions of its capital stock
or the security being converted or exchanged, or in connection with
the settlement of stock purchase contracts;
16
(4) dividends or distributions paid or made in its capital stock (or
rights to acquire its capital stock), or repurchases, redemptions or
acquisitions of capital stock in connection with the issuance or
exchange of capital stock (or of securities convertible into or
exchangeable for shares of its capital stock and distributions in
connection with the settlement of stock purchase contracts);
(5) redemptions, exchanges or repurchases of, or with respect to, any
rights outstanding under a shareholder rights plan or the declaration
or payment thereunder of a dividend or distribution of or with respect
to rights in the future; or
(6) payments under any preferred trust securities guarantee or guarantee
of junior subordinated debentures executed and delivered by FPL
concurrently with the issuance by a trust of any preferred trust
securities, so long as the amount of payments made on any preferred
trust securities or junior subordinated debentures (as the case may
be) is paid on all preferred trust securities or junior subordinated
debentures (as the case may be) then outstanding on a pro rata basis
in proportion to the full distributions to which each series of
preferred trust securities or junior subordinated debentures (as the
case may be) is then entitled if paid in full.
Before an extension period ends, FPL may further extend the interest
payment period. No extension period as further extended may exceed 20
consecutive quarters. After any extension period and the payment of all amounts
then due, FPL may select a new extended interest payment period. No interest
period may be extended beyond the maturity of the Junior Subordinated
Debentures.
REDEMPTION. Whenever Junior Subordinated Debentures are repaid,
whether at maturity or earlier redemption, the Property Trustee will apply the
proceeds to redeem a like amount of Preferred Trust Securities and Common Trust
Securities. (Trust Agreement, Section 4.02(a)).
Preferred Trust Securities will be redeemed at the redemption price
plus accrued and unpaid distributions with the proceeds from the contemporaneous
redemption or repayment of Junior Subordinated Debentures. Redemptions of the
Preferred Trust Securities will be made on a redemption date only if the Trust
has funds available for the payment of the redemption price plus accrued and
unpaid distributions. (Trust Agreement, Section 4.02(c)).
Holders of Preferred Trust Securities will be given not less than 30
nor more than 60 days' notice of any redemption. (Trust Agreement, Section
4.02(b)). On or before the redemption date, the Trust will irrevocably deposit
with the paying agent for Preferred Trust Securities sufficient funds and will
give the paying agent irrevocable instructions and authority to pay the
redemption price plus accrued and unpaid distributions to the holders upon
surrender of their Preferred Trust Securities. Distributions payable on or
before a redemption date will be payable to the holders on the record date for
the distribution payment. If notice is given and funds are deposited as
required, then on the redemption date all rights of holders of the Preferred
Trust Securities called for redemption will cease, except the right of the
holders to receive the redemption price plus accrued and unpaid distributions,
and the Preferred Trust Securities will cease to be outstanding. No interest
will accrue on amounts payable on the redemption date. In the event that any
date fixed for redemption of Preferred Trust Securities is not a business day,
then payment will be made on the next business day, except that, if such
business day falls in the next calendar year, then payment will be made on the
immediately preceding business day. No interest will be payable because of any
such delay. If payment of Preferred Trust Securities called for redemption is
improperly withheld or refused and not paid either by the Trust or by FPL
pursuant to the Preferred Trust Securities Guarantee, distributions on such
Preferred Trust Securities will continue to accrue to the date of payment. In
that event, the actual payment date will be considered the date fixed for
redemption for purposes of calculating the redemption price plus accrued and
unpaid distributions. (Trust Agreement, Section 4.02(d)).
Subject to applicable law, including United States federal securities
law, FPL or its affiliates may at any time and from time to time purchase
outstanding Preferred Trust Securities by tender, in the open market or by
private agreement.
If Preferred Trust Securities are partially redeemed on a redemption
date, a corresponding percentage of the Common Trust Securities will be
redeemed. The particular Preferred Trust Securities to be redeemed will be
17
selected not more than 60 days prior to the redemption date by the Property
Trustee by such method as the Property Trustee shall deem fair, taking into
account the denominations in which they were issued. The Property Trustee will
promptly notify the Preferred Trust Security registrar in writing of the
Preferred Trust Securities selected for redemption and, where applicable, the
partial amount to be redeemed. (Trust Agreement, Section 4.02(f)).
SUBORDINATION OF COMMON TRUST SECURITIES. Payment of distributions on,
and the redemption price, plus accrued and unpaid distributions, of, the
Preferred Trust Securities and Common Trust Securities shall be made pro rata
based on the liquidation preference amount of such securities. However, if on
any distribution payment date or redemption date an event of default under the
Trust Agreement resulting from an event of default under the Subordinated
Indenture has occurred and is continuing, no payment on any Common Trust
Security shall be made until all payments due on the Preferred Trust Securities
have been made. In that case, funds available to the Property Trustee shall
first be applied to the payment in full of all distributions on, or the
redemption price plus accrued and unpaid distributions of, Preferred Trust
Securities then due and payable. (Trust Agreement, Section 4.03(a)).
If an event of default under the Trust Agreement results from an event
of default under the Subordinated Indenture, the holder of Common Trust
Securities cannot take action with respect to the Trust Agreement default until
the effect of all defaults with respect to the Preferred Trust Securities has
been cured, waived or otherwise eliminated. Until the event of default under the
Trust Agreement with respect to Preferred Trust Securities has been cured,
waived or otherwise eliminated, the Property Trustee shall, to the fullest
extent permitted by law, act solely on behalf of the holders of Preferred Trust
Securities and not the holder of the Common Trust Securities, and only the
holders of Preferred Trust Securities will have the right to direct the Property
Trustee to act on their behalf. (Trust Agreement, Section 4.03(b)).
LIQUIDATION DISTRIBUTION UPON DISSOLUTION. The Trust will be dissolved
and liquidated by the Property Trustee on the first to occur of:
(1) the expiration of the term of the Trust;
(2) the bankruptcy, dissolution or liquidation of FPL;
(3) the redemption of all of the Preferred Trust Securities of the Trust;
(4) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction; or
(5) at any time, at the election of FPL. (Trust Agreement, Sections 9.01
and 9.02).
If a dissolution of the Trust occurs, the Trust will be liquidated by
the Property Trustee as expeditiously as the Property Trustee determines to be
appropriate. If a dissolution of the Trust occurs other than by redemption of
all the Preferred Trust Securities, the Property Trustee will provide for the
satisfaction of liabilities of creditors, if any, and distribute to each holder
of the Preferred Trust Securities and Common Trust Securities a proportionate
amount of Junior Subordinated Debentures. If a distribution of Junior
Subordinated Debentures is determined by the Property Trustee not to be
practical, holders of Preferred Trust Securities will be entitled to receive,
out of the assets of the Trust after adequate provision for the satisfaction of
liabilities of creditors, if any, an amount equal to the aggregate liquidation
preference of the Preferred Trust Securities plus accrued and unpaid
distributions thereon to the date of payment. If this liquidation distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate liquidation distribution, then the amounts payable by
the Trust on the Preferred Trust Securities shall be paid on a pro rata basis.
FPL, as holder of the Common Trust Securities, will be entitled to receive
distributions upon any dissolution pro rata with the holders of the Preferred
Trust Securities, except that if an event of default (or event that, with the
lapse of time or giving of notice, would become such an event of default) has
occurred and is continuing under the Subordinated Indenture, the Preferred Trust
Securities will have a preference over the Common Trust Securities. (Trust
Agreement, Section 9.04).
18
EVENTS OF DEFAULT; NOTICE. Any one of the following events will be an
event of default under the Trust Agreement whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body:
(1) the occurrence of an event of default as described in the Subordinated
Indenture;
(2) default by the Trust in the payment of any distribution when it
becomes due and payable, and continuation of that default for a period
of 30 days;
(3) default by the Trust in the payment of any redemption price, plus
accrued and unpaid distributions, of any Preferred Trust Security or
Common Trust Security when it becomes due and payable;
(4) default in the performance, or breach, in any material respect, of any
covenant or warranty of the trustees in the Trust Agreement which is
not dealt with above, and continuation of that default or breach for a
period of 90 days after written notice to the Trust, the defaulting
trustee under the Trust Agreement and FPL by the holders of Preferred
Trust Securities having at least 33% of the total liquidation
preference amount of the outstanding Preferred Trust Securities.
However, the holders of Preferred Trust Securities will be deemed to
have agreed to an extension of the 90 day period if corrective action
is initiated by any of the trustees within such period and is
diligently pursued in good faith; or
(5) the occurrence of certain events of bankruptcy or insolvency with
respect to the Trust. (Trust Agreement, Section 1.01).
Within 90 days after the occurrence of any default known to the
Property Trustee, the Property Trustee shall transmit to the holders of
Preferred Trust Securities, FPL and the Administrative Trustees notice of any
such default, unless that default shall have been cured or waived. (Trust
Agreement, Section 8.02).
A holder of Preferred Trust Securities may directly institute a
proceeding to enforce payment when due to the holder of the Preferred Trust
Securities of the principal of or interest on Junior Subordinated Debentures
having a principal amount equal to the aggregate liquidation preference amount
of the holder's Preferred Trust Securities. The holders of Preferred Trust
Securities have no other rights to exercise directly any other remedies
available to the holder of the Junior Subordinated Debentures unless the
trustees under the Trust Agreement fail to do so. (Trust Agreement, Section
6.01(a)).
REMOVAL OF TRUSTEES. Unless an event of default under the Subordinated
Indenture has occurred and is continuing, the holder of the Common Trust
Securities may remove any trustee under the Trust Agreement at any time. If an
event of default under the Subordinated Indenture has occurred and is
continuing, the holders of a majority of the total liquidation preference amount
of the outstanding Preferred Trust Securities may remove the Property Trustee or
the Delaware Trustee, or both of them. The holder of the Common Trust Securities
may remove any Administrative Trustee at any time. Any resignation or removal of
a trustee under the Trust Agreement will take effect only on the acceptance of
appointment by the successor trustee. (Trust Agreement, Section 8.10).
Holders of Preferred Trust Securities will have no right to appoint or
remove the Administrative Trustees of the Trust, who may be appointed, removed
or replaced solely by FPL as the holder of the Common Trust Securities. (Trust
Agreement, Section 8.10).
VOTING RIGHTS. Except as provided below and under "Description of the
Preferred Trust Securities Guarantee--Modification and Assignment," and as
otherwise required by law or the Trust Agreement, the holders of Preferred Trust
Securities will have no voting rights.
While Junior Subordinated Debentures are held by the Property Trustee,
the Property Trustee shall not:
(1) direct the time, method and place to conduct any proceeding for any
remedy available to the Subordinated Indenture Trustee (as such term
is defined below under "Description of the Junior Subordinated
19
Debentures--General"), or execute any trust or power conferred on the
Subordinated Indenture Trustee with respect to the Junior Subordinated
Debentures;
(2) waive any past default under the Subordinated Indenture;
(3) exercise any right to rescind or annul a declaration that the
principal of all the Junior Subordinated Debentures will be due and
payable; or
(4) consent to any amendment, modification or termination of the
Subordinated Indenture or the Junior Subordinated Debentures, where
that consent will be required,
without, in each case, obtaining the prior approval of the holders of Preferred
Trust Securities having at least a majority of the aggregate liquidation
preference amount of all outstanding Preferred Trust Securities of the Trust.
Where a consent of each holder of Junior Subordinated Debentures affected is
required, no consent shall be given by the Property Trustee without the prior
consent of each holder of the Preferred Trust Securities affected. The Property
Trustee shall not revoke any action previously authorized or approved by a vote
of the holders of Preferred Trust Securities, except pursuant to the subsequent
vote of the holders of Preferred Trust Securities. (Trust Agreement, Section
6.01(b)). If the Property Trustee fails to enforce its rights, as holder, under
the Junior Subordinated Debentures or the Trust Agreement, a holder of the
Preferred Trust Securities may institute a legal proceeding directly against FPL
to enforce the Property Trustee's rights under the Junior Subordinated
Debentures or the Trust Agreement without first instituting any legal proceeding
against the Property Trustee or anyone else. (Trust Agreement, Section 6.01(a)).
The Property Trustee shall notify all holders of Preferred Trust Securities of
any notice of default received from the Subordinated Indenture Trustee. The
Property Trustee shall not take any action approved by the consent of the
holders of Preferred Trust Securities without an opinion of counsel experienced
in those matters to the effect that the Trust will be classified as a grantor
trust and not as an association taxable as a corporation for United States
federal income tax purposes on account of that action. (Trust Agreement, Section
6.01(b)).
Holders of Preferred Trust Securities may give any required approval
at a meeting convened for such purpose or by written consent without prior
notice. (Trust Agreement, Section 6.06). The Administrative Trustees will give
notice of any meeting at which holders of Preferred Trust Securities are
entitled to vote. (Trust Agreement, Section 6.02).
No vote or consent of the holders of Preferred Trust Securities will
be required for the Trust to redeem and cancel Preferred Trust Securities in
accordance with the Trust Agreement.
Notwithstanding that holders of Preferred Trust Securities are
entitled to vote or consent under any of the circumstances described above, any
Preferred Trust Securities that are owned by FPL, any Administrative Trustee or
any affiliate of any of them, shall be treated as if they were not outstanding
for purposes of such vote or consent. (Trust Agreement, Section 1.01).
AMENDMENTS. The Trust Agreement may be amended from time to time by a
majority of its Administrative Trustees and FPL, without the consent of any
holders of Preferred Trust Securities or the other trustees under the Trust
Agreement in order to:
(1) cure any ambiguity; correct or supplement any provision that may be
inconsistent with any other provision of the Trust Agreement or
amendment to the Trust Agreement; or make any other provisions with
respect to matters or questions arising under the Trust Agreement;
(2) change the name of the Trust; or
(3) modify, eliminate or add to any provisions of the Trust Agreement to
the extent necessary to ensure that the Trust will not be classified
for United States federal income tax purposes other than as a grantor
trust (and not an association taxable as a corporation) at any time
that any Preferred Trust Securities and Common Trust Securities are
20
outstanding or to ensure the Trust's exemption from the status of an
"investment company" under the Investment Company Act of 1940.
No amendment described above may materially adversely affect the
interests of any holder of Preferred Trust Securities or Common Trust Securities
without the applicable consents required pursuant to the following two
paragraphs. Any of the amendments of the Trust Agreement described in paragraph
(1) above shall become effective when notice of the amendment is given to the
holders of Preferred Trust Securities and Common Trust Securities in accordance
with the provisions of the Trust Agreement. (Trust Agreement, Section 10.03(a)).
Except as provided below, any provision of the Trust Agreement may be
amended by the Administrative Trustees and FPL with:
(1) the consent of holders of Preferred Trust Securities and Common Trust
Securities representing not less than a majority in aggregate
liquidation preference amount of the Preferred Trust Securities and
Common Trust Securities then outstanding; and
(2) receipt by the trustees of an opinion of counsel to the effect that
such amendment or the exercise of any power granted to the trustees in
accordance with the amendment will not affect the Trust's status as a
grantor trust for federal income tax purposes (and not an association
taxable as a corporation) or affect the Trust's exemption from the
status of an "investment company" under the Investment Company Act of
1940. (Trust Agreement, Section 10.03(b)).
Each affected holder of Preferred Trust Securities must consent to any
amendment to the Trust Agreement that:
(1) adversely changes the amount or timing of any distribution with
respect to Preferred Trust Securities or otherwise adversely affects
the amount of any distribution required to be made in respect of
Preferred Trust Securities as of a specified date;
(2) restricts the right of a holder of Preferred Trust Securities to
institute suit for the enforcement of any such payment on or after
that date; or
(3) modify the provisions described in clauses (1) and (2) above. (Trust
Agreement, Section 10.03(c)).
FORM, EXCHANGE AND TRANSFER. Preferred Trust Securities may be
exchanged for other Preferred Trust Securities in any authorized denomination
and of like tenor and aggregate liquidation preference. (Trust Agreement,
Section 5.04).
Subject to the terms of the Trust Agreement, Preferred Trust
Securities may be presented for exchange as provided above or for registration
of transfer, duly endorsed or accompanied by a duly executed instrument of
transfer, at the office of the Preferred Trust Security registrar. The
Administrative Trustees may designate FPL or any affiliate of FPL as the
Preferred Trust Security registrar. The Property Trustee will initially act as
the Preferred Trust Security registrar and transfer agent. (Trust Agreement,
Section 5.08). No service charge will be made for any registration of transfer
or exchange of Preferred Trust Securities, but the Preferred Trust Security
registrar may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection with the transfer or exchange. A
transfer or exchange will be made when the Preferred Trust Security registrar
and Administrative Trustees are satisfied with the documents of title and
identity of the person making the request. (Trust Agreement, Section 5.04). The
Administrative Trustees may at any time designate another transfer agent and
registrar or rescind the designation of any transfer agent and registrar or
approve a change in the office through which any transfer agent and registrar
acts, except that FPL will, or will cause the Preferred Trust Security registrar
to, maintain an office or agency in The City of New York where Preferred Trust
Securities may be transferred or exchanged. (Trust Agreement, Sections 2.07(a)
and 5.08).
The Trust will not be required to:
21
(1) issue, register the transfer of, or exchange any Preferred Trust
Securities during the period beginning at the opening of business 15
calendar days before the mailing of a notice of redemption of any
Preferred Trust Securities called for redemption and ending at the
close of business on the day the notice is mailed; or
(2) register the transfer of or exchange any Preferred Trust Securities so
selected for redemption, in whole or in part, except the unredeemed
portion of any Preferred Trust Securities being redeemed in part.
(Trust Agreement, Section 5.04).
PAYMENT ON PREFERRED TRUST SECURITIES AND PAYING AGENT. Unless
otherwise stated in a prospectus supplement, payments in respect of the
Preferred Trust Securities will be made on the applicable distribution dates by
check mailed to the address of the holder entitled thereto as such address
appears on the Preferred Trust Security register. (Trust Agreement, Section
4.04). The paying agent shall initially be the Property Trustee and any
co-paying agent chosen by the Property Trustee that is acceptable to the
Administrative Trustees and FPL. The paying agent may resign upon 30 days'
written notice to the Administrative Trustees, the Property Trustee and FPL. In
the event that the Property Trustee shall no longer be the paying agent, the
Administrative Trustees shall appoint a successor, which shall be a bank, trust
company or affiliate of FPL reasonably acceptable to the Property Trustee and
FPL, to act as paying agent. (Trust Agreement, Section 5.09).
DUTIES OF THE TRUSTEES. The Delaware Trustee will act as the resident
trustee in the State of Delaware and will have no other significant duties. The
Property Trustee will hold the Junior Subordinated Debentures on behalf of the
Trust and will maintain a payment account with respect to the Preferred Trust
Securities and Common Trust Securities, and will also act as trustee under the
Trust Agreement for the purposes of the Trust Indenture Act of 1939. (Trust
Agreement, Sections 2.06 and 2.07(b)).
The Administrative Trustees of the Trust are authorized and directed
to conduct the affairs of the Trust and to operate the Trust so that
(1) the Trust will not be deemed to be an "investment company" required to
be registered under the Investment Company Act of 1940,
(2) the Trust will not be taxed as a corporation, and
(3) the Junior Subordinated Debentures will be treated as indebtedness of
FPL for United States federal income tax purposes.
In this regard, FPL and the Administrative Trustees are authorized to take any
action, not inconsistent with applicable law, the certificate of trust or the
Trust Agreement, that FPL and the Administrative Trustees determine in their
discretion to be necessary or desirable for those purposes, as long as the
action does not materially adversely affect the interests of the holders of the
Preferred Trust Securities. (Trust Agreement, Section 2.07(d)).
MISCELLANEOUS. Holders of the Preferred Trust Securities have no
preemptive or similar rights. (Trust Agreement, Section 5.13).
NOTICES. Notices to holders of Preferred Trust Securities will be sent
by mail to the addresses of those holders as they appear in the security
register for those Preferred Trust Securities. (Trust Agreement, Section 6.02).
TITLE. The Property Trustee, the Delaware Trustee, the Administrative
Trustees, and the Preferred Trust Security registrar and transfer agent, and any
agent of the Property Trustee, the Delaware Trustee, the Administrative
Trustees, or the Preferred Trust Security registrar and transfer agent, may
treat the person in whose name a Preferred Trust Security is registered as the
absolute owner of that Preferred Trust Security for the purpose of receiving
distributions and all other purposes, regardless of any notice to the contrary.
(Trust Agreement, Section 5.06).
GOVERNING LAW. The Trust Agreement, the Preferred Trust Securities and
the Common Trust Securities will be governed by and construed in accordance with
the laws of the State of Delaware, without regard to conflict of laws principles
22
thereunder, except to the extent that the law of any other jurisdiction is
mandatorily applicable. (Trust Agreement, Section 10.05).
DESCRIPTION OF THE PREFERRED TRUST SECURITIES GUARANTEE
GENERAL. This section briefly summarizes some of the provisions of the
Preferred Trust Securities Guarantee Agreement that FPL will execute and deliver
for the benefit of the holders of the Preferred Trust Securities issued by the
Trust. The terms of these agreements are substantially the same, and they are
referred to in this prospectus as the "Preferred Trust Securities Guarantee
Agreement." This summary does not contain a complete description of the
Preferred Trust Securities Guarantee Agreement. You should read this summary
together with the Preferred Trust Securities Guarantee Agreement for a complete
understanding of all the provisions. The form of the Preferred Trust Securities
Guarantee Agreement has been previously filed with the SEC and is an exhibit to
the registration statement filed with the SEC of which this prospectus is a
part. In addition, the Preferred Trust Securities Guarantee Agreement will be
qualified as an indenture under the Trust Indenture Act of 1939 and is therefore
subject to the provisions of the Trust Indenture Act of 1939. You should read
the Trust Indenture Act of 1939 for a complete understanding of its provisions.
The Bank of New York will act as Preferred Trust Securities Guarantee
Trustee under the Preferred Trust Securities Guarantee Agreement and will hold
the Preferred Trust Securities Guarantee for the benefit of the holders of the
Preferred Trust Securities.
GENERAL TERMS OF THE PREFERRED TRUST SECURITIES GUARANTEE. FPL will
absolutely, irrevocably and unconditionally agree to make the guarantee payments
listed below in full to the holders of the Preferred Trust Securities if they
are not made by the Trust, as and when due, regardless of any defense, right of
set-off or counterclaim that the Trust may have or assert. (Preferred Trust
Securities Guarantee Agreement, Section 5.01). The following payments will be
subject to the Preferred Trust Securities Guarantee (without duplication):
(1) any accrued and unpaid distributions required to be paid on Preferred
Trust Securities, to the extent the Trust has funds in the payment
account maintained by the Property Trustee legally available for these
payments at such time;
(2) the redemption price, plus all accrued and unpaid distributions to the
redemption date, for any Preferred Trust Securities called for
redemption by the Trust, to the extent the Trust has funds in the
payment account maintained by the Property Trustee legally available
for these payments at such time; and
(3) upon a voluntary or involuntary dissolution, winding-up or termination
of the Trust (except in connection with the distribution of Junior
Subordinated Debentures to the holders in exchange for Preferred Trust
Securities as provided in the Trust Agreement or upon a redemption of
all of the Preferred Trust Securities upon maturity or redemption of
the Junior Subordinated Debentures as provided in the Trust
Agreement), the lesser of:
(a) the aggregate of the liquidation preference amount and all
accrued and unpaid distributions on Preferred Trust Securities to
the date of payment, to the extent the Trust has funds in the
payment account maintained by the Property Trustee legally
available for these payments at such time; and
(b) the amount of assets of the Trust remaining available for
distribution to holders of Preferred Trust Securities in
liquidation of the Trust after satisfaction of liabilities to
creditors of the Trust as required by applicable law.
(Preferred Trust Securities Guarantee Agreement, Section 1.01). FPL's obligation
to make a guarantee payment may be satisfied by either making a direct payment
of the required amounts by FPL to the holders of Preferred Trust Securities or
causing the Trust to pay such amounts to those holders. (Preferred Trust
Securities Guarantee Agreement, Section 5.01).
23
The Preferred Trust Securities Guarantee will be a guarantee, subject
to certain subordination provisions, as to payment with respect to the Preferred
Trust Securities, but will not apply to any payment of distributions if and to
the extent that the Trust does not have funds legally available to make those
payments. (Preferred Trust Securities Guarantee Agreement, Sections 1.01 and
5.05). If FPL does not make interest payments on the Junior Subordinated
Debentures held by a Trust, the applicable Trust will not have funds available
to pay distributions on the Preferred Trust Securities.
FPL will fully and unconditionally guarantee payments due on the
Preferred Trust Securities issued by the Trust through a combination of the
following:
(1) FPL's obligations under Junior Subordinated Debentures;
(2) the rights of holders of Preferred Trust Securities to enforce those
obligations;
(3) FPL's agreement to pay the expenses of the Trust; and
(4) the Preferred Trust Securities Guarantee.
No single one of the documents listed above standing alone or
operating in conjunction with fewer than all of the other documents constitutes
the guarantee by FPL. It is only the combined operation of these documents that
has the effect of providing a full and unconditional, but subordinated,
guarantee as to payment by FPL of the Preferred Trust Securities.
Except as otherwise stated in the related prospectus supplement, the
covenants in the Preferred Trust Securities Guarantee Agreement would not give
holders of the Preferred Trust Securities protection in the event of a
highly-leveraged transaction involving FPL.
SECURITY AND RANKING. The Preferred Trust Securities Guarantee will be
an unsecured obligation of FPL and will rank:
(1) subordinate and junior in right of payment to all other liabilities of
FPL (except those made pari passu or subordinate by their terms);
(2) equal in right of payment with the most senior preferred or preference
stock that may be issued by FPL and with any guarantee that may be
entered into by FPL in respect of any preferred or preference stock of
any affiliate of FPL; and
(3) senior to FPL common stock. (Preferred Trust Securities Guarantee
Agreement, Section 6.01).
The Preferred Trust Securities Guarantee Agreement does not limit the
amount of other indebtedness, including guarantees, that FPL may issue or incur
or the amount of preferred or preference stock it may issue.
The Trust Agreement provides that by accepting Preferred Trust
Securities, a holder agrees to the subordination provisions and other terms of
the Preferred Trust Securities Guarantee. (Trust Agreement, Section 5.02).
The Preferred Trust Securities Guarantee will be a guarantee of
payment and not of collection, that is, the guaranteed party may institute a
legal proceeding directly against FPL to enforce its rights under the Preferred
Trust Securities Guarantee without first instituting a legal proceeding against
anyone else. (Preferred Trust Securities Guarantee Agreement, Sections 5.04 and
5.05).
EVENTS OF DEFAULT. An event of default under the Preferred Trust
Securities Guarantee Agreement will occur upon failure of FPL to perform any of
its payment obligations under the Preferred Trust Securities Guarantee
Agreement, which failure has not been cured within 90 days of receipt of notice
thereof. (Preferred Trust Securities Guarantee Agreement, Section 1.01). Upon an
24
event of default, the holders of the Preferred Trust Securities having a
majority of the aggregate liquidation preference of the Preferred Trust
Securities have the right to:
(1) direct the time, method and place of conducting any proceeding for any
remedy available to the Preferred Trust Securities Guarantee Trustee
under the Preferred Trust Securities Guarantee Agreement, or
(2) direct the exercise of any trust or power conferred upon the Preferred
Trust Securities Guarantee Trustee under the Preferred Trust
Securities Guarantee Agreement. (Preferred Trust Securities Guarantee
Agreement, Section 5.04).
Any holder of the Preferred Trust Securities may enforce the Preferred
Trust Securities Guarantee, or institute a legal proceeding directly against FPL
to enforce the Preferred Trust Securities Guarantee Trustee's rights under the
Preferred Trust Securities Guarantee Agreement without first instituting a legal
proceeding against the Trust, the Preferred Trust Securities Guarantee Trustee
or anyone else. (Preferred Trust Securities Guarantee Agreement, Section 5.04).
The holders of the Preferred Trust Securities having a majority of the aggregate
liquidation preference of the Preferred Trust Securities may waive any past
event of default and its consequences. (Preferred Trust Securities Guarantee
Agreement, Section 2.06).
FPL will be required to deliver to the Preferred Trust Securities
Guarantee Trustee an annual statement as to its compliance with all conditions
under the Preferred Trust Securities Guarantee Agreement. (Preferred Trust
Securities Guarantee Agreement, Section 2.04).
MODIFICATION AND ASSIGNMENT. No consent of holders of Preferred Trust
Securities is required for changes to the Preferred Trust Securities Guarantee
Agreement that do not materially adversely affect their rights. Except as
provided below, changes to the Preferred Trust Securities Guarantee Agreement
that materially adversely affect the rights of Preferred Trust Securities
require the prior approval of the holders of Preferred Trust Securities having
at least a majority of the aggregate liquidation preference amount of the
outstanding Preferred Trust Securities. Each affected holder of Preferred Trust
Securities must consent to any amendment to the Preferred Trust Securities
Guarantee Agreement that impairs the right of such holder to receive guarantee
payments under the Preferred Trust Securities Guarantee Agreement or to
institute suit for enforcement of any such payment. (Preferred Trust Securities
Guarantee Agreement, Section 8.01).
All guarantees and agreements contained in the Preferred Trust
Securities Guarantee Agreement will bind the successors, assigns, receivers,
trustees and representatives of FPL and will inure to the benefit of the holders
of the Preferred Trust Securities then outstanding. (Preferred Trust Securities
Guarantee Agreement, Section 8.02).
TERMINATION OF THE PREFERRED TRUST SECURITIES GUARANTEE. The Preferred
Trust Securities Guarantee Agreement will terminate and be of no further force
and effect upon:
(1) full payment of the redemption price, plus accrued and unpaid
distributions to the redemption date, for all the Preferred Trust
Securities;
(2) the distribution of Junior Subordinated Debentures to holders of the
Preferred Trust Securities in exchange for all of the Preferred Trust
Securities; or
(3) full payment of the amounts payable upon liquidation of the Trust.
However, the Preferred Trust Securities Guarantee will continue to be effective
or will be reinstated, as the case may be, if at any time, as result of the
subordination provisions or any mistake or any judicial proceeding or otherwise,
any holder of Preferred Trust Securities must return any sums paid under the
Preferred Trust Securities or the Preferred Trust Securities Guarantee.
(Preferred Trust Securities Guarantee Agreement, Section 7.01).
GOVERNING LAW. The Preferred Trust Securities Guarantee Agreement
provides that it is to be governed by and construed in accordance with the laws
of the State of New York, without regard to conflict of laws principles
25
thereunder, except to the extent that the law of any other jurisdiction is
mandatorily applicable. (Preferred Trust Securities Guarantee Agreement, Section
8.06).
DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES
GENERAL. The Junior Subordinated Debentures, which the Property
Trustee will hold on behalf of the Trust as trust assets, will be issued by FPL
in one or more series under an Indenture between FPL and The Bank of New York,
as trustee. This Indenture, as it may be amended and supplemented from time to
time, is referred to in this prospectus as the "Subordinated Indenture." The
Bank of New York, as trustee under the Subordinated Indenture, is referred to in
this prospectus as the "Subordinated Indenture Trustee." The Subordinated
Indenture provides for the issuance from time to time of subordinated debt in an
unlimited amount. The Junior Subordinated Debentures and all other subordinated
debt issued previously or hereafter under the Subordinated Indenture are
collectively referred to in this prospectus as the "Subordinated Indenture
Securities."
This section briefly summarizes some of the terms of the Junior
Subordinated Debentures and some of the provisions of the Subordinated
Indenture. This summary does not contain a complete description of the Junior
Subordinated Debentures. You should read this summary together with the
Subordinated Indenture and the officer's certificates or other documents
establishing the Junior Subordinated Debentures for a complete understanding of
all the provisions and for the definitions of some terms used in this summary.
The form of Subordinated Indenture, the form of officer's certificate that may
be used to establish a series of Junior Subordinated Debentures and a form of
the Junior Subordinated Debentures have been previously filed with the SEC, and
are exhibits to the registration statement. In addition, the Subordinated
Indenture will be qualified under the Trust Indenture Act of 1939 and is
therefore subject to the provisions of the Trust Indenture Act of 1939. You
should read the Trust Indenture Act of 1939 for a complete understanding of its
provisions.
The Junior Subordinated Debentures issued by FPL to the Trust will
constitute a separate series under the Subordinated Indenture and will be
limited in aggregate principal amount to the sum of the aggregate liquidation
preference amount of the related Preferred Trust Securities and the
consideration paid by FPL for the related Common Trust Securities.
The Junior Subordinated Debentures will be unsecured, subordinated
obligations of FPL which rank junior to all of FPL's Senior Indebtedness (as
defined herein). All Junior Subordinated Debentures issued under the
Subordinated Indenture will rank equally and ratably with all other Junior
Subordinated Debentures issued under the Subordinated Indenture, except to the
extent that FPL elects to provide security with respect to any Junior
Subordinated Debenture without providing that security to all outstanding Junior
Subordinated Debentures as allowed under the Subordinated Indenture.
Each series of Junior Subordinated Debentures may have different
terms. FPL will include some or all of the following information about a
specific series of Junior Subordinated Debentures in the prospectus supplement
relating to those Junior Subordinated Debentures:
(1) the title of those Junior Subordinated Debentures,
(2) any limit upon the aggregate principal amount of those Junior
Subordinated Debentures,
(3) the date(s) on which FPL will pay the principal of those Junior
Subordinated Debentures,
(4) the rate(s) of interest on those Junior Subordinated Debentures, or
how the rate(s) of interest will be determined, the date(s) from which
interest will accrue, the dates on which FPL will pay interest and the
record date for any interest payable on any interest payment date,
(5) the person to whom FPL will pay interest on those Junior Subordinated
Debentures on any interest payment date, if other than the person in
whose name those Junior Subordinated Debentures are registered at the
close of business on the record date for that interest payment,
26
(6) the place(s) at which or methods by which FPL will make payments on
those Junior Subordinated Debentures and the place(s) at which or
methods by which the registered owners of those Junior Subordinated
Debentures may transfer or exchange those Junior Subordinated
Debentures and serve notices and demands to or upon FPL,
(7) the security registrar and any paying agent or agents for those Junior
Subordinated Debentures,
(8) any date(s) on which, the price(s) at which and the terms and
conditions upon which FPL may, at its option, redeem those Junior
Subordinated Debentures, in whole or in part, and any restrictions on
those redemptions,
(9) any sinking fund or other provisions or options held by the registered
owners of those Junior Subordinated Debentures that would obligate FPL
to repurchase or redeem those Junior Subordinated Debentures,
(10) the denominations in which FPL may issue those Junior Subordinated
Debentures, if other than denominations of $25 and any integral
multiple of $25,
(11) the currency or currencies in which FPL may pay the principal of or
premium, if any, or interest on those Junior Subordinated Debentures
(if other than in U.S. dollars),
(12) if FPL or a registered owner may elect to pay, or receive, principal
of or premium, if any, or interest on those Junior Subordinated
Debentures in a currency other than that in which those Junior
Subordinated Debentures are stated to be payable, the terms and
conditions upon which that election may be made,
(13) if FPL will, or may, pay the principal of or premium, if any, or
interest on those Junior Subordinated Debentures in securities or
other property, the type and amount of those securities or other
property and the terms and conditions upon which FPL or a registered
owner may elect to pay or receive those payments,
(14) if the amount payable in respect of principal of or premium, if any,
or interest on those Junior Subordinated Debentures may be determined
by reference to an index or other fact or event ascertainable outside
of the Subordinated Indenture, the manner in which those amounts will
be determined,
(15) the portion of the principal amount of the Junior Subordinated
Debentures that FPL will pay upon declaration of acceleration of the
maturity of those Junior Subordinated Debentures, if other than the
entire principal amount of those Junior Subordinated Debentures,
(16) any events of default with respect to those Junior Subordinated
Debentures and any covenants of FPL for the benefit of the registered
owners of those Junior Subordinated Debentures, other than those
specified in the Subordinated Indenture,
(17) the terms, if any, pursuant to which those Junior Subordinated
Debentures may be exchanged for shares of capital stock or other
securities of any other entity,
(18) a definition of "Eligible Obligations" under the Subordinated
Indenture with respect to the Junior Subordinated Debentures
denominated in a currency other than U.S. dollars, and any other
provisions for the reinstatement of FPL's indebtedness in respect of
those Junior Subordinated Debentures after their satisfaction and
discharge,
(19) if FPL will issue those Junior Subordinated Debentures in global form,
necessary information relating to the issuance of those Junior
Subordinated Debentures in global form,
27
(20) if FPL will issue those Junior Subordinated Debentures as bearer
securities, necessary information relating to the issuance of those
Junior Subordinated Debentures as bearer securities,
(21) any limits on the rights of the registered owners of those Junior
Subordinated Debentures to transfer or exchange those Junior
Subordinated Debentures or to register their transfer, and any related
service charges,
(22) any exceptions to the provisions governing payments due on legal
holidays or any variations in the definition of business day with
respect to those Junior Subordinated Debentures,
(23) any collateral security, assurance, or guarantee for those Junior
Subordinated Debentures,
(24) the designation of the trust to which the Junior Subordinated
Debentures are to be issued,
(25) the terms relating to any additional interest that may be payable as a
result of any tax, assessment or governmental charges, and
(26) any other terms of those Junior Subordinated Debentures that are not
inconsistent with the provisions of the Subordinated Indenture.
(Subordinated Indenture, Section 301).
Except as otherwise stated in the related prospectus supplement, the
covenants in the Subordinated Indenture would not give registered owners of
Junior Subordinated Debentures protection in the event of a highly-leveraged
transaction involving FPL.
SUBORDINATION. The Junior Subordinated Debentures will be subordinate
and junior in right of payment to all Senior Indebtedness of FPL. (Subordinated
Indenture, Article Fourteen). No payment of the principal (including redemption
and sinking fund payments) of, or interest, or premium, if any, on the Junior
Subordinated Debentures may be made by FPL until all holders of Senior
Indebtedness of FPL have been paid in full (or provision has been made for such
payment), if any of the following occurs:
(1) certain events of bankruptcy, insolvency or reorganization of FPL;
(2) any Senior Indebtedness of FPL is not paid when due (after the
expiration of any applicable grace period) and that default continues
without waiver; or
(3) any other default has occurred and continues without waiver (after the
expiration of any applicable grace period) pursuant to which the
holders of Senior Indebtedness of FPL are permitted to accelerate the
maturity of such Senior Indebtedness. (Subordinated Indenture, Section
1402).
Upon any distribution of assets of FPL to creditors in connection with
any insolvency, bankruptcy or similar proceeding, all principal of, and premium,
if any, and interest due or to become due on all Senior Indebtedness of FPL must
be paid in full before the holders of the Junior Subordinated Debentures are
entitled to receive or retain any payment from such distribution. (Subordinated
Indenture, Section 1402).
"Senior Indebtedness" means all of FPL's obligations, whether
presently existing or from time to time hereafter incurred, created, assumed or
existing, to pay principal, premium, interest, penalties, fees and any other
payment in respect of any of the following:
(1) obligations for borrowed money, including without limitation, such
obligations as are evidenced by credit agreements, notes, debentures,
bonds or other securities or instruments;
(2) capitalized lease obligations;
28
(3) all obligations of the types referred to in clauses (1) and (2) of
others which FPL has assumed, endorsed, guaranteed, contingently
agreed to purchase or provide funds for the payment of, or otherwise
becomes liable for, under any agreement; or
(4) all renewals, extensions or refundings of obligations of the kinds
described in any of the preceding categories.
Any such indebtedness, renewal, extension or refunding, however, will not be
Senior Indebtedness if the instrument creating or evidencing it or the
assumption or guarantee of it provides that it is not superior in right of
payment to or is equal in right of payment with the Junior Subordinated
Debentures. Furthermore trade accounts payable or long-term purchase obligations
will not be Senior Indebtedness. Senior Indebtedness will be entitled to the
benefits of the subordination provisions in the Subordinated Indenture
irrespective of the amendment, modification or waiver of any term of the Senior
Indebtedness. (Subordinated Indenture, Section 101).
PAYMENT AND PAYING AGENTS. Except as stated in the related prospectus
supplement, on each interest payment date FPL will pay interest on each Junior
Subordinated Debenture to the person in whose name that Junior Subordinated
Debenture is registered as of the close of business on the record date relating
to that interest payment date. However, on the date that the Junior Subordinated
Debentures mature, FPL will pay the interest to the person to whom it pays the
principal. Also, if FPL has defaulted in the payment of interest on any Junior
Subordinated Debenture, it may pay that defaulted interest to the registered
owner of that Junior Subordinated Debenture:
(1) as of the close of business on a date that the Subordinated Indenture
Trustee selects, which may not be more than 15 days or less than 10
days before the date that FPL proposes to pay the defaulted interest,
or
(2) in any other lawful manner that does not violate the requirements of
any securities exchange on which that Junior Subordinated Debenture is
listed and that the Subordinated Indenture Trustee believes is
acceptable. (Subordinated Indenture, Section 307).
Unless otherwise stated in the related prospectus supplement, the
principal, premium, if any, and interest on the Junior Subordinated Debentures
at maturity will be payable when such Junior Subordinated Debentures are
presented at the main corporate trust office of The Bank of New York, as paying
agent, in The City of New York. FPL may change the place of payment on the
Junior Subordinated Debentures, appoint one or more additional paying agents,
including itself, and remove any paying agent. (Subordinated Indenture, Section
602).
TRANSFER AND EXCHANGE. Unless otherwise stated in the related
prospectus supplement, Junior Subordinated Debentures may be transferred or
exchanged at the main corporate trust office of The Bank of New York, as
security registrar, in The City of New York. FPL may change the place for
transfer and exchange of the Junior Subordinated Debentures and may designate
one or more additional places for that transfer and exchange.
Except as otherwise stated in the related prospectus supplement, there
will be no service charge for any transfer or exchange of the Junior
Subordinated Debentures. However, FPL may require payment of any tax or other
governmental charge in connection with any transfer or exchange of the Junior
Subordinated Debentures.
FPL will not be required to transfer or exchange any Junior
Subordinated Debenture selected for redemption. Also, FPL will not be required
to transfer or exchange any Junior Subordinated Debenture during a period of 15
days before selection of Junior Subordinated Debentures to be redeemed.
(Subordinated Indenture, Section 305).
Unless otherwise stated in the related prospectus supplement, if
Junior Subordinated Debentures are distributed to holders of Preferred Trust
Securities in a dissolution of the Trust, the Junior Subordinated Debentures
will be issued in fully registered certificated form in the denominations and
integral multiples thereof in which the Preferred Trust Securities have been
issued, and they may be transferred or exchanged as described above. (Trust
Agreement, Section 9.04).
29
DEFEASANCE. FPL may, at any time, elect to have all of its obligations
discharged with respect to all or a portion of any Subordinated Indenture
Securities (including the Junior Subordinated Debentures). To do so, FPL must
irrevocably deposit with the Subordinated Indenture Trustee or any paying agent,
in trust:
(1) money in an amount that will be sufficient to pay all or that portion
of the principal, premium, if any, and interest due and to become due
on those Subordinated Indenture Securities, on or prior to their
maturity, or
(2) in the case of a deposit made prior to the maturity of that series of
Subordinated Indenture Securities,
(a) direct obligations of, or obligations unconditionally guaranteed
by, the United States and entitled to the benefit of its full
faith and credit that do not contain provisions permitting their
redemption or other prepayment at the option of their issuer, and
(b) certificates, depositary receipts or other instruments that
evidence a direct ownership interest in those obligations or in
any specific interest or principal payments due in respect of
those obligations that do not contain provisions permitting their
redemption or other prepayment at the option of their issuer, the
principal of and the interest on which, when due, without any
regard to reinvestment of that principal or interest, will
provide money that, together with any money deposited with or
held by the Subordinated Indenture Trustee, will be sufficient to
pay all or that portion of the principal, premium, if any, and
interest due and to become due on those Subordinated Indenture
Securities, on or prior to their maturity, or
(3) a combination of (1) and (2) that will be sufficient to pay all or
that portion of the principal, premium, if any, and interest due and
to become due on those Subordinated Indenture Securities, on or prior
to their maturity. (Subordinated Indenture, Section 701).
OPTION TO EXTEND INTEREST PAYMENT PERIOD. So long as no event of
default under the Subordinated Indenture has occurred and is continuing, FPL may
extend the interest payment period from time to time on the Junior Subordinated
Debentures for one or more periods. (Subordinated Indenture, Section 312). As a
consequence, distributions on the Preferred Trust Securities would be deferred
during any extension period. Interest would, however, continue to accrue on the
Junior Subordinated Debentures. During any extended interest period, or for so
long as an "Event of Default" under the Subordinated Indenture resulting from
any payment default or a payment default under the Preferred Trust Securities
Guarantee has occurred and is continuing, FPL may not:
(1) declare or pay any dividend or distribution on its capital stock;
(2) redeem, purchase, acquire or make a liquidation payment with respect
to any of its capital stock;
(3) pay any principal, interest or premium on, or repay, repurchase or
redeem any debt securities that are equal or junior in right of
payment with the Junior Subordinated Debentures; or
(4) make any payments with respect to any guarantee of debt securities if
such guarantee is equal or junior in right of payment to the Junior
Subordinated Debentures,
other than
(1) purchases, redemptions or other acquisitions of its capital stock in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of employees, officers, directors
or agents or a stock purchase or dividend reinvestment plan, or the
satisfaction of its obligations pursuant to any contract or security
outstanding on the date that the interest payment period is extended
requiring it to purchase, redeem or acquire its capital stock;
(2) any payment, repayment, redemption, purchase, acquisition or
declaration of dividend described in clauses (1) and (2) above as a
result of a reclassification of its capital stock or the exchange or
30
conversion of all or a portion of one class or series of its capital
stock for another class or series of its capital stock;
(3) the purchase of fractional interests in shares of its capital stock
pursuant to the conversion or exchange provisions of its capital stock
or the security being converted or exchanged, or in connection with
the settlement of stock purchase contracts;
(4) dividends or distributions paid or made in its capital stock (or
rights to acquire its capital stock), or repurchases, redemptions or
acquisitions of capital stock in connection with the issuance or
exchange of capital stock (or of securities convertible into or
exchangeable for shares of its capital stock and distributions in
connection with the settlement of stock purchase contracts);
(5) redemptions, exchanges or repurchases of, or with respect to, any
rights outstanding under a shareholder rights plan or the declaration
or payment thereunder of a dividend or distribution of or with respect
to rights in the future; or
(6) payments under any preferred trust securities guarantee or guarantee
of junior subordinated debentures executed and delivered by FPL
concurrently with the issuance by a trust of any preferred trust
securities, so long as the amount of payments made on any preferred
trust securities or junior subordinated debentures (as the case may
be) is paid on all preferred trust securities or junior subordinated
debentures (as the case may be) then outstanding on a pro rata basis
in proportion to the full distributions to which each series of
preferred trust securities or junior subordinated debentures (as the
case may be) is then entitled if paid in full. (Subordinated
Indenture, Section 608).
Any extension period with respect to any securities of FPL similar to
the Junior Subordinated Debentures or any other securities issued under the
Subordinated Indenture will also apply to payments of interest on the Junior
Subordinated Debentures.
Any extension period with respect to payment of interest on the Junior
Subordinated Debentures will, except as provided in (6) above, also apply to:
(1) payments of interest on all junior subordinated debt securities of
FPL, including all other securities issued under the Subordinated
Indenture;
(2) distributions on the related preferred trust securities; and
(3) distributions on all other securities of the Trust or any other
subsidiary trust of FPL with terms substantially the same as those of
the Trust Agreement.
Before an extension period ends, FPL may further extend the interest
payment period. No extension period as further extended may exceed 20
consecutive quarters. After any extension period and the payment of all amounts
then due, FPL may select a new extended interest payment period. No interest
period may be extended beyond the maturity of the Junior Subordinated
Debentures. FPL will give the Trust and the Subordinated Indenture Trustee
notice of its election of an extension period prior to the earlier of (i) one
business day before the record date for the distribution on the Preferred Trust
Securities which would occur if FPL did not make the election to extend or (ii)
the date the Administrative Trustees are required to give notice to any
securities exchange or any other applicable self-regulatory organization of the
record date for such a distribution. The Property Trustee shall send notice of
that election to the holders of Preferred Trust Securities.
ADDITIONAL INTEREST. So long as any Preferred Trust Securities remain
outstanding, if the Trust is required to pay any taxes, duties, assessments or
governmental charges imposed by the United States or any other taxing authority
on income derived from the interest payments on the Junior Subordinated
Debentures, then FPL will pay as interest on the Junior Subordinated Debentures
any additional interest that may be necessary in order that the net amounts
received and retained by the Trust after the payment of those taxes, duties,
assessments or governmental charges will be the same as the Trust would have had
31
in the absence of such payment. (Subordinated Indenture, Section 313).
REDEMPTION. For so long as the Trust is the holder of all of the
related Junior Subordinated Debentures, the proceeds of any redemption of Junior
Subordinated Debentures will be used by the Trust to redeem Preferred Trust
Securities and Common Trust Securities in accordance with their terms. (Trust
Agreement, Section 4.02(a)).
The redemption terms of the Junior Subordinated Debentures, if any,
will be set forth in a prospectus supplement. Unless set forth differently in a
prospectus supplement, and except with respect to Junior Subordinated Debentures
redeemable at the option of the holder, Junior Subordinated Debentures will be
redeemable upon notice between 30 and 60 days prior to the redemption date. If
less than all of the Junior Subordinated Debentures of any series or any tranche
thereof are to be redeemed, the Subordinated Indenture Trustee will select the
Junior Subordinated Debentures to be redeemed. In the absence of any provision
for selection, the Subordinated Indenture Trustee will choose a method of random
selection as it deems fair and appropriate. (Subordinated Indenture, Sections
403 and 404).
Junior Subordinated Debentures selected for redemption will cease to
bear interest on the redemption date. The paying agent will pay the redemption
price and any accrued interest once the Junior Subordinated Debentures are
surrendered for redemption. (Subordinated Indenture, Section 405). If only part
of a Junior Subordinated Debenture is redeemed, the Subordinated Indenture
Trustee will deliver a new Junior Subordinated Debenture of the same series for
the remaining portion without charge. (Subordinated Indenture, Section 406).
Any redemption at the option of FPL may be conditional upon the
receipt by the paying agent, on or prior to the date fixed for redemption, of
money sufficient to pay the redemption price. If the paying agent has not
received such money by the date fixed for redemption, FPL will not be required
to redeem such Junior Subordinated Debentures. (Subordinated Indenture, Section
404).
Subject to applicable law, including United States federal securities
law, FPL or its affiliates may at any time and from time to time purchase
outstanding Junior Subordinated Debentures by tender, in the open market or by
private agreement.
CONSOLIDATION, MERGER, AND SALE OF ASSETS. Under the Subordinated
Indenture, FPL may not consolidate with or merge into any other entity or
convey, transfer or lease its properties and assets substantially as an entirety
to any entity, unless:
(1) the entity formed by that consolidation, or the entity into which FPL
is merged, or the entity that acquires or leases FPL's property and
assets, is an entity organized and existing under the laws of the
United States, any state or the District of Columbia and that entity
expressly assumes FPL's obligations on all Subordinated Indenture
Securities and under the Subordinated Indenture,
(2) immediately after giving effect to the transaction, no event of
default under the Subordinated Indenture and no event that, after
notice or lapse of time or both, would become an event of default
under the Subordinated Indenture exists, and
(3) FPL delivers an officer's certificate and an opinion of counsel to the
Subordinated Indenture Trustee, as provided in the Subordinated
Indenture. (Subordinated Indenture, Section 1101).
The Subordinated Indenture does not prevent or restrict:
(1) any consolidation or merger after the consummation of which FPL would
be the surviving or resulting entity;
(2) any consolidation of FPL with any entity all of the outstanding voting
securities of which are owned, directly or indirectly, by FPL, or any
merger of any such entity into any other of such entities, or any
conveyance or other transfer, or lease, of properties or assets by any
thereof to any other thereof;
32
(3) any conveyance or other transfer, or lease, of any part of the
properties or assets of FPL which does not constitute the entirety, or
substantially the entirety, thereof; or
(4) the approval by FPL of, or the consent by FPL to any consolidation or
merger to which any direct or indirect subsidiary or affiliate of FPL
may be a party, or any conveyance, transfer or lease by any such
subsidiary or affiliate of any or all of its properties or assets.
(Subordinated Indenture, Section 1103).
EVENTS OF DEFAULT. Each of the following is an event of default under
the Subordinated Indenture with respect to the Subordinated Indenture Securities
of any series:
(1) failure to pay interest on the Subordinated Indenture Securities of
that series within 30 days after it is due (provided, however, that a
valid extension of the interest period by FPL will not constitute an
event of default),
(2) failure to pay principal or premium, if any, on the Subordinated
Indenture Securities of that series when it is due,
(3) failure to comply with any other covenant in the Subordinated
Indenture, other than a covenant that does not relate to that series
of Subordinated Indenture Securities, that continues for 90 days after
FPL receive written notice of such failure to comply from the
Subordinated Indenture Trustee, or FPL and the Subordinated Indenture
Trustee receive written notice of such failure to comply from the
registered owners of at least 33% in principal amount of the
Subordinated Indenture Securities of that series,
(4) certain events of bankruptcy, insolvency or reorganization of FPL and
(5) any other event of default specified with respect to the Subordinated
Indenture Securities of that series. (Subordinated Indenture, Section
801).
In the case of the third event of default listed above, the
Subordinated Indenture Trustee may extend the grace period. In addition, if
holders of a particular series have given a notice of default, then holders of
at least the same percentage of Junior Subordinated Debentures of that series,
together with the Subordinated Indenture Trustee, may also extend the grace
period. The grace period will be automatically extended if FPL has initiated and
is diligently pursuing corrective action in good faith. (Subordinated Indenture,
Section 801). An event of default with respect to the Subordinated Indenture
Securities of a particular series will not necessarily constitute an event of
default with respect to Subordinated Indenture Securities of any other series
issued under the Subordinated Indenture.
REMEDIES. If an event of default applicable to the Subordinated
Indenture Securities of one or more series, but not applicable to all
outstanding Subordinated Indenture Securities, exists, then either the
Subordinated Indenture Trustee or the registered owners of at least 33% in
aggregate principal amount of the Subordinated Indenture Securities of each of
the affected series may declare the principal of and accrued but unpaid interest
on all the Subordinated Indenture Securities of that series to be due and
payable immediately. (Subordinated Indenture, Section 802).
If the event of default is applicable to all outstanding Subordinated
Indenture Securities, then only the Subordinated Indenture Trustee or the
registered owners of at least 33% in aggregate principal amount of all
outstanding Subordinated Indenture Securities of all series, voting as one
class, and not the registered owners of any one series, may make a declaration
of acceleration. (Subordinated Indenture, Section 802). However, the event of
default giving rise to the declaration relating to any series of Subordinated
Indenture Securities will be automatically waived, and that declaration and its
consequences will be automatically rescinded and annulled, if, at any time after
that declaration and before a judgment or decree for payment of the money due
has been obtained:
(1) FPL deposits with the Subordinated Indenture Trustee a sum sufficient
to pay:
(a) all overdue interest on all Subordinated Indenture Securities of
that series,
32
(b) the principal of and any premium on any Subordinated Indenture
Securities of that series that have become due for reasons other
than that declaration, and interest that is then due,
(c) interest on overdue interest for that series, and
(d) all amounts due to the Subordinated Indenture Trustee under the
Subordinated Indenture, and
(2) any other event of default with respect to the Subordinated Indenture
Securities of that series has been cured or waived as provided in the
Subordinated Indenture. (Subordinated Indenture, Section 802).
Other than its obligations and duties in case of an event of default
under the Subordinated Indenture, the Subordinated Indenture Trustee is not
obligated to exercise any of its rights or powers under the Subordinated
Indenture at the request or direction of any of the registered owners of the
Subordinated Indenture Securities, unless those registered owners offer
reasonable indemnity to the Subordinated Indenture Trustee. (Subordinated
Indenture, Section 903). If they provide this reasonable indemnity, the
registered owners of a majority in principal amount of any series of
Subordinated Indenture Securities will have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the
Subordinated Indenture Trustee, or exercising any trust or power conferred on
the Subordinated Indenture Trustee, with respect to the Subordinated Indenture
Securities of that series. However, if an event of default under the
Subordinated Indenture relates to more than one series of Subordinated Indenture
Securities, only the registered owners of a majority in aggregate principal
amount of all affected series of Subordinated Indenture Securities, considered
as one class, will have the right to make that direction. Also, the direction
must not violate any law or the Subordinated Indenture, and may not expose the
Subordinated Indenture Trustee to personal liability in circumstances where its
indemnity would not, in the Subordinated Indenture Trustee's sole discretion, be
adequate. (Subordinated Indenture, Section 812).
No registered owner of Subordinated Indenture Securities of any series
will have any right to institute any proceeding under the Subordinated
Indenture, or exercise any remedy under the Subordinated Indenture, unless:
(1) that registered owner has previously given to the Subordinated
Indenture Trustee written notice of a continuing event of default with
respect to the Subordinated Indenture Securities of that series,
(2) the registered owners of a majority in aggregate principal amount of
the outstanding Subordinated Indenture Securities of all series in
respect of which an event of default under the Subordinated Indenture
exists, considered as one class, have made written request to the
Subordinated Indenture Trustee, and have offered reasonable indemnity
to the Subordinated Indenture Trustee to institute that proceeding in
its own name as trustee, and
(3) the Subordinated Indenture Trustee has failed to institute any
proceeding, and has not received from the registered owners of a
majority in aggregate principal amount of the outstanding Subordinated
Indenture Securities of all series in respect of which an event of
default under the Subordinated Indenture exists, considered as one
class, a direction inconsistent with that request, within 60 days
after that notice, request and offer. (Subordinated Indenture, Section
807).
However, these limitations do not apply to a suit instituted by a
registered owner of a Subordinated Indenture Security for the enforcement of
payment of the principal of or any premium, if any, or interest on that
Subordinated Indenture Security on or after the applicable due date specified in
that Subordinated Indenture Security. (Subordinated Indenture, Section 808).
FPL is required to deliver to the Subordinated Indenture Trustee an
annual statement as to its compliance with all conditions and covenants
applicable to it under the Subordinated Indenture. (Subordinated Indenture,
Section 606).
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF PREFERRED TRUST
SECURITIES. If there is an event of default with respect to Junior Subordinated
Debentures held by the Trust, then the holders of Preferred Trust Securities
issued by the Trust will rely on the Property Trustee or the Subordinated
Indenture Trustee, acting for the benefit of the Property Trustee, to enforce
34
the Property Trustee's rights against FPL as a holder of the Junior Subordinated
Debentures. However, a holder of Preferred Trust Securities may enforce the
Subordinated Indenture directly against FPL to the same extent, and upon the
same conditions, as if the holder of Preferred Trust Securities held a principal
amount of Junior Subordinated Debentures equal to the aggregate liquidation
amount of its Preferred Trust Securities. (Subordinated Indenture, Section 610).
Subject to their right to bring suit to enforce their right to
payment, the holders of Preferred Trust Securities would not be able to
institute any proceeding with respect to the Subordinated Indenture unless the
Subordinated Indenture Trustee has failed to do so for 60 days after a request
of the holders of at least a majority of the aggregate liquidation amount of
outstanding Preferred Trust Securities. Upon such failure, the holders of a
majority of the aggregate liquidation amount of the outstanding Preferred Trust
Securities would have the right to directly institute proceedings for
enforcement of all other rights of the Subordinated Indenture Trustee against
FPL to the fullest extent permitted by law. (Subordinated Indenture, Sections
807, 808 and 812).
MODIFICATION AND WAIVER. Without the consent of any registered owner
of Subordinated Indenture Securities, FPL and the Subordinated Indenture Trustee
may amend or supplement the Subordinated Indenture for any of the following
purposes:
(1) to provide for the assumption by any permitted successor to FPL of
FPL's obligations with respect to the Subordinated Indenture and the
Subordinated Indenture Securities in the case of a merger or
consolidation or a conveyance, transfer or lease of its properties and
assets substantially as an entirety,
(2) to add covenants of FPL or to surrender any right or power conferred
upon FPL by the Subordinated Indenture,
(3) to add any additional events of default,
(4) to change, eliminate or add any provision of the Subordinated
Indenture, provided that if that change, elimination or addition will
materially adversely affect the interests of the registered owners of
Subordinated Indenture Securities of any series or tranche, that
change, elimination or addition will become effective with respect to
that series or tranche only
(a) when the required consent of the registered owners of
Subordinated Indenture Securities of that series or tranche has
been obtained, or
(b) when no Subordinated Indenture Securities of that series or
tranche remain outstanding under the Subordinated Indenture,
(5) to provide collateral security for all but not a part of the
Subordinated Indenture Securities,
(6) to establish the form or terms of Subordinated Indenture Securities of
any other series or tranche,
(7) to provide for the authentication and delivery of bearer securities
and the related coupons and for other matters relating to those bearer
securities,
(8) to accept the appointment of a successor Subordinated Indenture
Trustee or co-trustee with respect to the Subordinated Indenture
Securities of one or more series and to change any of the provisions
of the Subordinated Indenture as necessary to provide for the
administration of the trusts under the Subordinated Indenture by more
than one trustee,
(9) to add procedures to permit the use of a non-certificated system of
registration for the Subordinated Indenture Securities of all or any
series or tranche,
(10) to change any place where
35
(a) the principal of and premium, if any, and interest on all or any
series or tranche of Subordinated Indenture Securities are
payable,
(b) all or any series or tranche of Subordinated Indenture Securities
may be transferred or exchanged, and
(c) notices and demands to or upon FPL in respect of Subordinated
Indenture Securities and the Subordinated Indenture may be
served, or
(11) to cure any ambiguity or inconsistency or to add or change any other
provisions with respect to matters and questions arising under the
Subordinated Indenture, provided those changes or additions may not
materially adversely affect the interests of the registered owners of
Subordinated Indenture Securities of any series or tranche.
(Subordinated Indenture, Section 1201).
The registered owners of a majority in aggregate principal amount of
the Subordinated Indenture Securities of all series then outstanding may waive
compliance by FPL with certain restrictive provisions of the Subordinated
Indenture. (Subordinated Indenture, Section 607). The registered owners of a
majority in principal amount of the outstanding Subordinated Indenture
Securities of any series may waive any past default under the Subordinated
Indenture with respect to that series, except a default in the payment of
principal, premium, if any, or interest and a default with respect to certain
restrictive covenants or provisions of the Subordinated Indenture that cannot be
modified or amended without the consent of the registered owner of each
outstanding Subordinated Indenture Security of that series affected.
(Subordinated Indenture, Section 813). If the Trust holds Subordinated Indenture
Securities of any series, the Trust may not waive compliance, or any default in
compliance, by FPL with any covenant or term contained in, or any past default
under, the Subordinated Indenture or the Subordinated Indenture Securities of
such series, without the approval of at least a majority (or such greater
percentage required by the Trust Agreement) in aggregate liquidation preference
amount of the outstanding Preferred Trust Securities. (Subordinated Indenture,
Sections 607 and 813).
In addition to any amendments described above, if the Trust Indenture
Act of 1939 is amended after the date of the Subordinated Indenture in a way
that requires changes to the Subordinated Indenture or in a way that permits
changes to, or the elimination of, provisions that were previously required by
the Trust Indenture Act of 1939, the Subordinated Indenture will be deemed to be
amended to conform to that amendment of the Trust Indenture Act of 1939 or to
make those changes, additions or eliminations. FPL and the Subordinated
Indenture Trustee may, without the consent of any registered owners, enter into
supplemental indentures to make that amendment. (Subordinated Indenture, Section
1201).
Except for any amendments described above, the consent of the
registered owners of a majority in aggregate principal amount of the
Subordinated Indenture Securities of all series then outstanding, considered as
one class, is required for all other modifications to the Subordinated
Indenture. However, if less than all of the series of Subordinated Indenture
Securities outstanding are directly affected by a proposed supplemental
indenture, then the consent only of the registered owners of a majority in
aggregate principal amount of outstanding Subordinated Indenture Securities of
all directly affected series, considered as one class, is required. But, if FPL
issues any series of Subordinated Indenture Securities in more than one tranche
and if the proposed supplemental indenture directly affects the rights of the
registered owners of Subordinated Indenture Securities of less than all of those
tranches, then the consent only of the registered owners of a majority in
aggregate principal amount of the outstanding Subordinated Indenture Securities
of all directly affected tranches, considered as one class, will be required.
However, none of those amendments or modifications may:
(1) change the dates on which the principal of or interest (except as
described above under "--Option to Extend Interest Payment Period") on
a Subordinated Indenture Security is due without the consent of the
registered owner of that Subordinated Indenture Security,
(2) reduce any Subordinated Indenture Security's principal amount or rate
of interest (or the amount of any installment of that interest) or
change the method of calculating that rate without the consent of the
registered owner of that Subordinated Indenture Security,
36
(3) reduce any premium payable upon the redemption of a Subordinated
Indenture Security without the consent of the registered owner of that
Subordinated Indenture Security,
(4) change the currency (or other property) in which a Subordinated
Indenture Security is payable without the consent of the registered
owner of that Subordinated Indenture Security,
(5) impair the right to sue to enforce payments on any Subordinated
Indenture Security on or after the date that it states that the
payment is due (or, in the case of redemption, on or after the
redemption date) without the consent of the registered owner of that
Subordinated Indenture Security,
(6) reduce the percentage in principal amount of the outstanding
Subordinated Indenture Securities of any series or tranche whose
owners must consent to an amendment, supplement or waiver without the
consent of the registered owner of each outstanding Subordinated
Indenture Security of that series or tranche,
(7) reduce the requirements for quorum or voting of any series or tranche
without the consent of the registered owner of each outstanding
Subordinated Indenture Security of that series or tranche, or
(8) modify certain of the provisions of the Subordinated Indenture
relating to supplemental indentures, waivers of certain covenants and
waivers of past defaults with respect to the Subordinated Indenture
Securities of any series or tranche, without the consent of the
registered owner of each outstanding Subordinated Indenture Security
affected by the modification.
A supplemental indenture that changes or eliminates any provision of
the Subordinated Indenture that has expressly been included only for the benefit
of one or more particular series or tranches of Subordinated Indenture
Securities, or that modifies the rights of the registered owners of Subordinated
Indenture Securities of that series or tranche with respect to that provision,
will not affect the rights under the Subordinated Indenture of the registered
owners of the Subordinated Indenture Securities of any other series or tranche.
So long as any Preferred Trust Securities are outstanding, the Subordinated
Indenture Trustee may not consent to any supplemental indenture without the
prior consent of the holders of a majority in aggregate liquidation preference
of all outstanding Preferred Trust Securities affected or, in the case of
changes described in clauses (1) through (8) immediately above, 100% in
aggregate liquidation preference of all such outstanding Preferred Trust
Securities affected. (Subordinated Indenture, Section 1202).
The Subordinated Indenture provides that, in order to determine
whether the registered owners of the required principal amount of the
outstanding Subordinated Indenture Securities have given any request, demand,
authorization, direction, notice, consent or waiver under the Subordinated
Indenture, or whether a quorum is present at the meeting of the registered
owners of Subordinated Indenture Securities, Subordinated Indenture Securities
owned by FPL or any other obligor upon the Subordinated Indenture Securities or
any affiliate of FPL or of that other obligor (unless FPL, that affiliate or
that obligor owns all Subordinated Indenture Securities outstanding under the
Subordinated Indenture, determined without regard to this provision) will be
disregarded and deemed not to be outstanding. (Subordinated Indenture, Section
101).
If FPL solicits any action under the Subordinated Indenture from
registered owners of Subordinated Indenture Securities, FPL may, at its option,
by signing a written request to the Subordinated Indenture Trustee, fix in
advance a record date for determining the registered owners of Subordinated
Indenture Securities entitled to take that action. However, FPL will not be
obligated to do this. If FPL fixes such a record date, that action may be taken
before or after that record date, but only the registered owners of record at
the close of business on that record date will be deemed to be registered owners
of Subordinated Indenture Securities for the purposes of determining whether
registered owners of the required proportion of the outstanding Subordinated
Indenture Securities have authorized that action. For these purposes, the
outstanding Subordinated Indenture Securities will be computed as of the record
date. Any action of a registered owner of any Subordinated Indenture Security
under the Subordinated Indenture will bind every future registered owner of that
Subordinated Indenture Security, or any Subordinated Indenture Security
replacing that Subordinated Indenture Security, with respect to anything that
the Subordinated Indenture Trustee or FPL do, fail to do, or allow to be done in
reliance on that action, whether or not that action is noted upon that
Subordinated Indenture Security. (Subordinated Indenture, Section 104).
37
RESIGNATION AND REMOVAL OF SUBORDINATED INDENTURE TRUSTEE. The
Subordinated Indenture Trustee may resign at any time with respect to any series
of Subordinated Indenture Securities by giving written notice of its resignation
to FPL. Also, the registered owners of a majority in principal amount of the
outstanding Subordinated Indenture Securities of one or more series of
Subordinated Indenture Securities may remove the Subordinated Indenture Trustee
at any time with respect to the Subordinated Indenture Securities of that
series, by delivering an instrument evidencing this action to the Subordinated
Indenture Trustee and FPL. However, so long as any Preferred Trust Securities
remain outstanding, the Trust cannot deliver an instrument evidencing this
action without the consent of the holders of a majority in aggregate liquidation
preference of Preferred Trust Securities outstanding. (Subordinated Indenture,
Section 910). The resignation or removal of the Subordinated Indenture Trustee
and the appointment of a successor trustee will not become effective until a
successor trustee accepts its appointment.
Except with respect to a Subordinated Indenture Trustee appointed by
the registered owners of Subordinated Indenture Securities, the Subordinated
Indenture Trustee will be deemed to have resigned and the successor will be
deemed to have been appointed as trustee in accordance with the Subordinated
Indenture if:
(1) no event of default under the Subordinated Indenture or event that,
after notice or lapse of time, or both, would become an event of
default under the Subordinated Indenture exists, and
(2) FPL has delivered to the Subordinated Indenture Trustee resolutions of
its Board of Directors appointing a successor trustee and that
successor trustee has accepted that appointment in accordance with the
terms of the Subordinated Indenture. (Subordinated Indenture, Section
910).
NOTICES. Notices to registered owners of Subordinated Indenture
Securities will be sent by mail to the addresses of those registered owners as
they appear in the security register for those Subordinated Indenture
Securities. (Subordinated Indenture, Section 106).
TITLE. The person in whose name a Subordinated Indenture Security is
registered may be treated as the absolute owner of that Subordinated Indenture
Security, whether or not that Subordinated Indenture Security is overdue, for
the purpose of making payments and for all other purposes, regardless of any
notice to the contrary. (Subordinated Indenture, Section 308).
GOVERNING LAW. The Subordinated Indenture and the Subordinated
Indenture Securities will be governed by, and construed in accordance with, the
laws of the State of New York, without regard to New York's conflict of law
principles, except to the extent that the law of any other jurisdiction is
mandatorily applicable. (Subordinated Indenture, Section 112).
INFORMATION CONCERNING THE TRUSTEES
In the regular course of business, FPL may obtain short-term funds
from several banks, including Deutsche Bank Trust Company Americas.
FPL and its affiliates, including FPL Group and FPL Group Capital Inc,
also maintain various banking and trust relationships with The Bank of New York.
In addition to acting as Subordinated Indenture Trustee, security registrar and
paying agent under the Subordinated Indenture, The Bank of New York would act as
(i) Preferred Trust Securities Guarantee Trustee under the Preferred Trust
Securities Guarantee Agreement described under "Description of the Preferred
Trust Securities Guarantee" above and (ii) Property Trustee under the Trust
Agreement. The Bank of New York (Delaware) acts as the Delaware Trustee under
the Trust Agreement.
38
PLAN OF DISTRIBUTION
FPL and the Trust may sell the securities offered pursuant to this
prospectus ("Offered Securities"):
(1) through underwriters or dealers,
(2) through agents, or
(3) directly to one or more purchasers.
THROUGH UNDERWRITERS OR DEALERS. If FPL and/or the Trust uses
underwriters in the sale of the Offered Securities, the underwriters will
acquire the Offered Securities for their own account. The underwriters may
resell the Offered Securities in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The underwriters may sell the Offered Securities directly
or through underwriting syndicates represented by managing underwriters. Unless
otherwise stated in the prospectus supplement relating to the Offered
Securities, the obligations of the underwriters to purchase those Offered
Securities will be subject to certain conditions, and the underwriters will be
obligated to purchase all of those Offered Securities if they purchase any of
them. If FPL and/or the Trust uses a dealer in the sale, FPL and/or the Trust
will sell the Offered Securities to the dealer as principal. The dealer may then
resell those Offered Securities at varying prices determined at the time of
resale.
Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
THROUGH AGENTS. FPL and/or the Trust may designate one or more agents
to sell the Offered Securities. Unless otherwise stated in a prospectus
supplement, the agents will agree to use their best efforts to solicit purchases
for the period of their appointment.
DIRECTLY. FPL and/or the Trust may sell the Offered Securities
directly to one or more purchasers. In this case, no underwriters, dealers or
agents would be involved.
GENERAL INFORMATION. A prospectus supplement will state the name of
any underwriter, dealer or agent and the amount of any compensation,
underwriting discounts or concessions paid, allowed or reallowed to them. A
prospectus supplement will also state the proceeds to FPL and/or the Trust from
the sale of the Offered Securities, any initial public offering price and other
terms of the offering of those Offered Securities.
FPL and/or the Trust may authorize underwriters, dealers or agents to
solicit offers by certain institutions to purchase the Offered Securities from
FPL and/or the Trust at the public offering price and on the terms described in
the related prospectus supplement pursuant to delayed delivery contracts
providing for payment and delivery on a specified date in the future.
The Offered Securities may also be offered and sold, if so indicated
in the applicable prospectus supplement, in connection with a remarketing upon
their purchase, in accordance with a redemption or repayment pursuant to their
terms, or otherwise, by one or more firms, which are referred to herein as the
"remarketing firms," acting as principals for their own accounts or as our agent
or the applicable trust's agents, as applicable. Any remarketing firm will be
identified and the terms of its agreement, if any, with FPL and/or the Trust and
its compensation will be described in the applicable prospectus supplement.
Remarketing firms may be deemed to be underwriters, as that term is defined in
the Securities Act of 1933, in connection with the securities remarketed
thereby.
FPL and/or the Trust may enter into derivative transactions with third
parties, or sell securities not covered by this prospectus to third parties in
privately negotiated transactions. If the applicable prospectus supplement
indicates, in connection with those derivatives, the third parties may sell
securities covered by this prospectus and the applicable prospectus supplement,
including in short sale transactions. If so, the third party may use securities
pledged by FPL and/or the Trust or borrowed from any of them or others to settle
those sales or to close out any related open borrowings of securities, and may
39
use securities received from FPL and/or the Trust in settlement of those
derivatives to close out any related open borrowings of securities. The third
party in such sale transactions will be an underwriter and, if not identified in
this prospectus, will be identified in the applicable prospectus supplement.
FPL and/or the Trust may have agreements to indemnify underwriters,
dealers and agents against, or to contribute to payments which the underwriters,
dealers and agents may be required to make in respect of, certain civil
liabilities, including liabilities under the Securities Act of 1933.
EXPERTS
The consolidated financial statements incorporated by reference in
this prospectus from FPL's Annual Report on Form 10-K have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated by reference herein (which expresses an unqualified opinion and
includes an explanatory paragraph relating to FPL's changes in 2003 in its
methods of accounting for special purpose entities and for asset retirement
obligations), and have been so incorporated in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing.
LEGAL OPINIONS
Steel Hector & Davis LLP, Miami, Florida, and Thelen Reid & Priest
LLP, New York, New York, co-counsel to FPL, will pass upon the legality of the
Offered Securities for FPL and the Trust. Hunton & Williams LLP, New York, New
York, will pass upon the legality of the Offered Securities for any underwriter,
dealer or agent. Certain matters of Delaware law relating to the validity of the
Preferred Trust Securities, the enforceability of the Trust Agreement and the
creation of the Trust will be passed upon by Morris, James, Hitchens & Williams
LLP, special Delaware counsel to FPL and the Trust. Thelen Reid & Priest LLP and
Hunton & Williams LLP may rely as to all matters of Florida law upon the opinion
of Steel Hector & Davis LLP, and on the opinion of Morris, James, Hitchens &
Williams LLP, as to matters involving the law of the State of Delaware in
connection with the Preferred Trust Securities. Steel Hector & Davis LLP may
rely as to all matters of New York law upon the opinion of Thelen Reid & Priest
LLP, and on the opinion of Morris, James, Hitchens & Williams LLP, as to matters
involving the law of the State of Delaware in connection with the Preferred
Trust Securities.
--------------------------------------
YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR
PROVIDED IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT. NEITHER FPL NOR THE
TRUST HAS AUTHORIZED ANYONE ELSE TO PROVIDE YOU WITH ADDITIONAL OR DIFFERENT
INFORMATION. NEITHER FPL NOR THE TRUST IS MAKING AN OFFER OF THESE SECURITIES IN
ANY JURISDICTION WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT ASSUME THAT
THE INFORMATION IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT IS ACCURATE AS
OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THOSE DOCUMENTS OR THAT THE
INFORMATION INCORPORATED BY REFERENCE IS ACCURATE AS OF ANY DATE OTHER THAN THE
DATE OF THE DOCUMENT INCORPORATED BY REFERENCE.
40
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses in connection with the issuance and distribution of the securities
being registered, other than underwriting and/or agents compensation, are:
Filing Fee for Registration Statement................................................$126,700
Legal and Accounting Fees............................................................$600,000*
Printing (S-3, prospectus, prospectus supplement, etc.)...............................$50,000*
Fees of the trustees..................................................................$50,000*
Florida Taxes......................................................................$4,000,000*
Rating Agencies' Fees................................................................$300,000*
Miscellaneous........................................................................ $13,300*
--------
Total ..........................................................................$5,140,000*
==========
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 607.0850 of the Florida Statutes generally permits FPL to
indemnify its directors, officers, employees or other agents who are subject to
any third-party actions because of their service to FPL if such persons acted in
good faith and in a manner they reasonably believed to be in, or not opposed to,
the best interests of FPL. If the proceeding is a criminal one, such person must
also have had no reasonable cause to believe his conduct was unlawful. In
addition, FPL may indemnify its directors, officers, employees or other agents
who are subject to derivative actions against expenses and amounts paid in
settlement which do not exceed, in the judgment of the board of directors, the
estimated expense of litigating the proceeding to conclusion, including any
appeal thereof, actually and reasonably incurred in connection with the defense
or settlement of such proceeding, if such person acted in good faith and in a
manner such person reasonably believed to be in, or not opposed to, the best
interests of FPL. To the extent that a director, officer, employee or other
agent is successful on the merits or otherwise in defense of a third-party or
derivative action, such person will be indemnified against expenses actually and
reasonably incurred in connection therewith. This Section also permits FPL to
further indemnify such persons by other means unless a judgment or other final
adjudication establishes that such person's actions or omissions which were
material to the cause of action constitute (1) a crime (unless such person had
reasonable cause to believe his conduct was lawful or had no reasonable cause to
believe it unlawful), (2) a transaction from which he derived an improper
personal benefit, (3) an action in violation of Florida Statutes Section
607.0834 (unlawful distributions to shareholders), or (4) willful misconduct or
a conscious disregard for the best interests of FPL in a proceeding by or in the
right of FPL to procure a judgment in its favor or in a proceeding by or in the
right of a shareholder.
Furthermore, Florida Statutes Section 607.0831 provides, in general,
that no director shall be personally liable for monetary damages to a
corporation or any other person for any statement, vote, decision, or failure to
act, regarding corporate management or policy, unless: (a) the director breached
or failed to perform his duties as a director; and (b) the director's breach of,
or failure to perform, those duties constitutes (i) a violation of criminal law,
unless the director had reasonable cause to believe his conduct was lawful or
had no reasonable cause to believe his conduct was unlawful, (ii) a transaction
from which the director derived an improper personal benefit, either directly or
indirectly, (iii) a circumstance under which the liability provisions of Florida
Statutes Section 607.0834 are applicable, (iv) in a proceeding by or in the
right of a corporation to procure a judgment in its favor or by or in the right
of a shareholder, conscious disregard for the best interest of a corporation, or
willful misconduct, or (v) in a proceeding by or in the right of someone other
than a corporation or a shareholder, recklessness or an act or omission which
was committed in bad faith or with malicious purpose or in a manner exhibiting
wanton and willful disregard of human rights, safety, or property. The term
"recklessness," as used above, means the action, or omission to act, in
conscious disregard of a risk: (a) known, or so obvious that it should have been
known, to the director; and (b) known to the director, or so obvious that it
should have been known, to be so great as to make it highly probable that harm
would follow from such action or omission.
II-1
FPL's bylaws provide generally that FPL shall, to the fullest extent
permitted by law, indemnify all directors and officers of FPL, directors,
officers, or other employees serving as a fiduciary of an employee benefit plan
of FPL, as well as any employees or agents of FPL or other persons serving at
the request of FPL in any capacity with any entity or enterprise other than FPL
to whom FPL has agreed to grant indemnification (each, an "Indemnified Person")
to the extent that any such person is made a party or threatened to be made a
party or called as a witness or is otherwise involved in any action, suit, or
proceeding in connection with his status as an Indemnified Person. Such
indemnification covers all expenses incurred by any Indemnified Person
(including attorneys' fees) and all liabilities and losses (including judgments,
fines and amounts to be paid in settlement) incurred thereby in connection with
any such action, suit or proceeding.
In addition, FPL carries insurance permitted by the laws of Florida on
behalf of directors, officers, employees or agents which may cover, among other
things, liabilities under the Securities Act.
Pursuant to Section 10 of each Trust Agreement, FPL has agreed to
indemnify and hold harmless each Trustee, any affiliate of each Trustee and any
officer, director, shareholder, member, partner or employee of each Trustee, and
any employee of the Trust (each such person, an "Trust Agreement Indemnified
Person") from and against any loss, liability, expense, damage or claim incurred
by such Trust Agreement Indemnified Person without negligence (gross negligence,
in the case of any Administrative Trustee or the Delaware Trustee or other
person who is a Trust Agreement Indemnified Person by virtue of the relationship
thereto), bad faith or willful misconduct on the part of the Trust Agreement
Indemnified Person, or in the case of any such affiliate, officer, director,
shareholder, member, partner or employee, on the part of the related Trustee,
arising out of or in connection with the acceptance or administration of the
trust or trusts thereunder or by reason of any act or omission performed or
omitted by such Trust Agreement Indemnified Person in good faith on behalf of
the Trust and in a manner such Trust Agreement Indemnified Person reasonably
believed to be within the scope of authority conferred on such Trust Agreement
Indemnified Person by the Trust Agreement. In addition, the Board of Directors
of FPL has authorized FPL to indemnify each of the officers or employees of FPL
(or any of its affiliates) who serve as an Administrative Trustee of the Trust,
in accordance with the bylaws provisions described above, and each such person
will be an Indemnified Person as defined in the second preceding paragraph.
ITEM 16. EXHIBITS.
1(a) - Form of Underwriting Agreement with respect to Bonds.
1(b) - Form of Distribution Agreement with respect to Bonds.
1(c) - Form of Underwriting Agreement with respect to Preferred Trust
Securities and related securities.
1(d) - Form of Underwriting Agreement with respect to preferred stock.
*4(a) - Restated Articles of Incorporation of FPL dated March 23, 1992
(filed as Exhibit 3(i)a to Form 10-K for the year ended December 31,
1993, File No. 1-3545).
*4(b) - Amendment to FPL's Restated Articles of Incorporation dated March
23, 1992 (filed as Exhibit 3(i)b to Form 10-K for the year ended
December 31, 1993, File No. 1-3545).
*4(c) - Amendment to FPL's Restated Articles of Incorporation dated May 11,
1992 (filed as Exhibit 3(i)c to Form 10-K for the year ended December
31, 1993, File No. 1-3545).
*4(d) - Amendment to FPL's Restated Articles of Incorporation dated March
12, 1993 (filed as Exhibit 3(i)d to Form 10-K for the year ended
December 31, 1993, File No. 1-3545).
*4(e) - Amendment to FPL's Restated Articles of Incorporation dated June 16,
1993 (filed as Exhibit 3(i)e to Form 10-K for the year ended December
31, 1993, File No. 1-3545).
II-2
*4(f) - Amendment to FPL's Restated Articles of Incorporation dated August
31, 1993 (filed as Exhibit 3(i)f to Form 10-K for the year ended
December 31, 1993, File No. 1-3545).
*4(g) - Amendment to FPL's Restated Articles of Incorporation dated November
30, 1993 (filed as Exhibit 3(i)g to Form 10-K for the year ended
December 31, 1993, File No. 1-3545).
*4(h) - Amendment to FPL's Restated Articles of Incorporation dated January
20, 2004 (filed as Exhibit 3(i)j to Form 10-K for the year ended
December 31, 2003, File No. 1-3545).
*4(i) - Amendment to FPL's Restated Articles of Incorporation dated January
20, 2004 (filed as Exhibit 3(i)k to Form 10-K for the year ended
December 31, 2003, File No. 1-3545).
*4(j) - Bylaws of FPL dated May 11, 1992 (filed as Exhibit 3 to Form 8-K
dated May 1, 1992, File No. 1-3545).
*4(k) - Mortgage and Deed of Trust dated as of January 1, 1944, and One
hundred and five Supplements thereto, between FPL and Deutsche Bank
Trust Company Americas, Trustee (the "Mortgage") (filed as Exhibit
B-3, File No. 2-4845; Exhibit 7(a), File No. 2-7126; Exhibit 7(a),
File No. 2-7523; Exhibit 7(a), File No. 2-7990; Exhibit 7(a), File No.
2-9217; Exhibit 4(a)-5, File No. 2-10093; Exhibit 4(c), File No.
2-11491; Exhibit 4(b)-1, File No. 2-12900; Exhibit 4(b)-1, File No.
2-13255; Exhibit 4(b)-1, File No. 2-13705; Exhibit 4(b)-1, File No.
2-13925; Exhibit 4(b)-1, File No. 2-15088; Exhibit 4(b)-1, File No.
2-15677; Exhibit 4(b)-1, File No. 2-20501; Exhibit 4(b)-1, File No.
2-22104; Exhibit 2(c), File No. 2-23142; Exhibit 2(c), File No.
2-24195; Exhibit 4(b)-1, File No. 2-25677; Exhibit 2(c), File No.
2-27612; Exhibit 2(c), File No. 2-29001; Exhibit 2(c), File No.
2-30542; Exhibit 2(c), File No. 2-33038; Exhibit 2(c), File No.
2-37679; Exhibit 2(c), File No. 2-39006; Exhibit 2(c), File No.
2-41312; Exhibit 2(c), File No. 2-44234; Exhibit 2(c), File No.
2-46502; Exhibit 2(c), File No. 2-48679; Exhibit 2(c), File No.
2-49726; Exhibit 2(c), File No. 2-50712; Exhibit 2(c), File No.
2-52826; Exhibit 2(c), File No. 2-53272; Exhibit 2(c), File No.
2-54242; Exhibit 2(c), File No. 2-56228; Exhibits 2(c) and 2(d), File
No. 2-60413; Exhibits 2(c) and 2(d), File No. 2-65701; Exhibit 2(c),
File No. 2-66524; Exhibit 2(c), File No. 2-67239; Exhibit 4(c), File
No. 2-69716; Exhibit 4(c), File No. 2-70767; Exhibit 4(b), File No.
2-71542; Exhibit 4(b), File No. 2-73799; Exhibits 4(c), 4(d) and 4(e),
File No. 2-75762; Exhibit 4(c), File No. 2-77629; Exhibit 4(c), File
No. 2-79557; Exhibit 99(a) to Post-Effective Amendment No. 5 to Form
S-8, File No. 33-18669; Exhibit 99(a) to Post-Effective Amendment No.
1 to Form S-3, File No. 33-46076; Exhibit 4(b) to Form 10-K for the
year ended December 31, 1993, File No. 1-3545; Exhibit 4(i) to Form
10-Q for the quarter ended June 30, 1994, File No. 1-3545; Exhibit
4(b) to Form 10-Q for the quarter ended June 30, 1995, File No.
1-3545; Exhibit 4(a) to Form 10-Q for the quarter ended March 31,
1996, File No. 1-3545; Exhibit 4 to Form 10-Q for the quarter ended
June 30, 1998, File No. 1-3545; Exhibit 4 to Form 10-Q for the quarter
ended March 31, 1999, File No. 1-3545; Exhibit 4(f) to Form 10-K for
the year ended December 31, 2000, File No. 1-3545; Exhibit 4(g) to
Form 10-K for the year ended December 31, 2000, File No. 1-3545;
Exhibit 4(o), File No. 333-102169; Exhibit 4(k) to Post-Effective
Amendment No. 1 to Form S-3, File No. 333-102172; Exhibit 4(l) to
Post-Effective Amendment No. 2 to Form S-3, File No. 333-102172; and
Exhibit 4(m) to Post-Effective Amendment No. 3 to Form S-3, File No.
333-102172).
4(l) - Form of Supplemental Indenture relating to the Bonds.
4(m) - Trust Agreement and Certificate of Trust of Florida Power & Light
Company Trust I.
4(n) - Trust Agreement and Certificate of Trust of Florida Power & Light
Company Trust II.
4(o) - Form of Amended and Restated Trust Agreement.
4(p) - Form of Subordinated Indenture relating to the Junior Subordinated
Debentures.
II-3
4(q) - Form of Officer's Certificate relating to the Junior Subordinated
Debentures, including form of Junior Subordinated Debentures.
4(r) - Form of Preferred Trust Securities Guarantee Agreement relating to
the Preferred Trust Securities.
4(s) - Form of Agreement as to Expenses and Liabilities relating to the
Trust is contained in Exhibit D of Exhibit 4(o) hereto.
4(t) - Form of Preferred Trust Securities is contained in Exhibit C of
Exhibit 4(o) hereto.
4(u) - Form of Articles of Amendment to establish a series of preferred
stock.
5(a) - Opinion and Consent, dated June 8, 2004, of Steel Hector & Davis
LLP, counsel to FPL, Florida Power & Light Company Trust I and Florida
Power & Light Company Trust II.
5(b) - Opinion and Consent, dated June 8, 2004, of Thelen Reid & Priest
LLP, co-counsel to FPL, Florida Power & Light Company Trust I and
Florida Power & Light Company Trust II.
5(c) - Opinion and Consent, dated June 8, 2004, of Morris, James, Hitchens
& Williams LLP, special Delaware counsel to FPL and Florida Power &
Light Company Trust I.
5(d) - Opinion and Consent, dated June 8, 2004, of Morris, James, Hitchens
& Williams LLP, special Delaware counsel to FPL and Florida Power &
Light Company Trust II.
*12 - Computation of Ratio of Earnings to Fixed Charges and Ratio of
Earnings to Fixed Charges plus Preferred Dividends (filed as Exhibit
12(b) to Form 10-K for the year ended December 31, 2003, File No.
1-3545 and Exhibit 12(b) to Form 10-Q for the quarter ended March 31,
2004, File No. 1-3545).
23(a) - Independent Auditors' Consent of Deloitte & Touche LLP.
23(b) - Consent of Steel Hector & Davis LLP (included in opinion, attached
hereto as Exhibit 5(a)).
23(c) - Consent of Thelen Reid & Priest LLP (included in opinion, attached
hereto as Exhibit 5(b)).
23(d) - Consent of Morris, James, Hitchens & Williams LLP (included in
opinion, attached hereto as Exhibit 5(c)).
23(e) - Consent of Morris, James, Hitchens & Williams LLP (included in
opinion, attached hereto as Exhibit 5(d)).
24 - Power of Attorney (included on the signature page of this
registration statement).
25(a) - Statement of Eligibility on Form T-1 of Deutsche Bank Trust Company
Americas with respect to the Mortgage.
25(b) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Subordinated Indenture Trustee with respect to the Junior Subordinated
Debentures.
25(c) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Property Trustee, with respect to the Amended and Restated Trust
Agreement of Florida Power & Light Company Trust I.
25(d) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Property Trustee, with respect to the Amended and Restated Trust
Agreement of Florida Power & Light Company Trust II.
II-4
25(e) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Preferred Trust Securities Guarantee Trustee, with respect to the
Preferred Trust Securities Guarantee Agreement of Florida Power &
Light Company Trust I.
25(f) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Preferred Trust Securities Guarantee Trustee, with respect to the
Preferred Trust Securities Guarantee Agreement of Florida Power &
Light Company Trust II.
*Incorporated herein by reference as indicated.
ITEM 17. UNDERTAKINGS.
The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement,
provided, however, that the registrants need not file a post-effective amendment
to include the information required to be included by subsection (i) or (ii) if
such information is contained in periodic reports filed by a registrant pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, which are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of FPL's Annual Report pursuant to Section 13(a) of
the Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrants pursuant to the provisions described under Item 15 above, or
otherwise, the registrants have been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by any registrant of expenses
incurred or paid by a director, officer or controlling person of such registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant against which the claim is asserted will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
II-5
POWER OF ATTORNEY
Each director and/or officer of the registrant whose signature appears
below hereby appoints the agents for service named in this registration
statement, and each of them severally, as his attorney-in-fact to sign in his
name and behalf, in any and all capacities stated below and to file with the
Securities and Exchange Commission, any and all amendments, including
post-effective amendments, to this registration statement, and the registrant
hereby also appoints each such agent for service as its attorney-in-fact with
like authority to sign and file any such amendments in its name and behalf.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Florida
Power & Light Company certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Juno Beach, State of Florida on the 8th day of
June, 2004.
FLORIDA POWER & LIGHT COMPANY
By: /s/ Armando J. Olivera
------------------------------------
Armando J. Olivera
President and Director
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Lewis Hay, III Chairman of the Board, Chief June 8, 2004
- ----------------------------------- Executive Officer and Director
Lewis Hay, III (Principal Executive Officer)
/s/ Moray P. Dewhurst Senior Vice President, Finance June 8, 2004
- ----------------------------------- and Chief Financial Officer and
Moray P. Dewhurst Director (Principal Financial
Officer)
/s/ K. Michael Davis Vice President, Accounting, June 8, 2004
- ----------------------------------- Controller and Chief Accounting
K. Michael Davis Officer (Principal Accounting
Officer)
/s/ Dennis P. Coyle Director June 8, 2004
- -----------------------------------
Dennis P. Coyle
/s/ Lawrence J. Kelleher Director June 8, 2004
- -----------------------------------
Lawrence J. Kelleher
/s/ Armando J. Olivera Director June 8, 2004
- -----------------------------------
Armando J. Olivera
/s/ Antonio Rodriguez Director June 8, 2004
- -----------------------------------
Antonio Rodriguez
/s/ John A. Stall Director June 8, 2004
- -----------------------------------
John A. Stall
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Florida
Power & Light Company Trust I certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Juno Beach, State of
Florida on the 8th day of June, 2004.
FLORIDA POWER & LIGHT COMPANY TRUST I
By: /s/ Paul I. Cutler
------------------------------------
Name: Paul I. Cutler
Title: Administrative Trustee
II-7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Florida
Power & Light Company Trust II certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Juno Beach, State of
Florida on the 8th day of June, 2004.
FLORIDA POWER & LIGHT COMPANY TRUST II
By: /s/ Paul I. Cutler
-------------------------------------
Name: Paul I. Cutler
Title: Administrative Trustee
II-8
EXHIBIT INDEX
1(a) - Form of Underwriting Agreement with respect to Bonds.
1(b) - Form of Distribution Agreement with respect to Bonds.
1(c) - Form of Underwriting Agreement with respect to Preferred Trust
Securities and related securities.
1(d) - Form of Underwriting Agreement with respect to preferred stock.
4(l) - Form of Supplemental Indenture relating to the Bonds.
4(m) - Trust Agreement and Certificate of Trust of Florida Power & Light
Company Trust I.
4(n) - Trust Agreement and Certificate of Trust of Florida Power & Light
Company Trust II.
4(o) - Form of Amended and Restated Trust Agreement.
4(p) - Form of Subordinated Indenture relating to the Junior Subordinated
Debentures.
4(q) - Form of Officer's Certificate relating to the Junior Subordinated
Debentures, including form of Junior Subordinated Debentures.
4(r) - Form of Preferred Trust Securities Guarantee Agreement relating to
the Preferred Trust Securities.
4(s) - Form of Agreement as to Expenses and Liabilities relating to the
Trust is contained in Exhibit D of Exhibit 4(o) hereto.
4(t) - Form of Preferred Trust Securities is contained in Exhibit C of
Exhibit 4(o) hereto.
4(u) - Form of Articles of Amendment to establish a series of preferred
stock.
5(a) - Opinion and Consent, dated June 8, 2004, of Steel Hector & Davis
LLP, counsel to FPL, Florida Power & Light Company Trust I and Florida
Power & Light Company Trust II.
5(b) - Opinion and Consent, dated June 8, 2004, of Thelen Reid & Priest
LLP, co-counsel to FPL, Florida Power & Light Company Trust I and
Florida Power & Light Company Trust II.
5(c) - Opinion and Consent, dated June 8, 2004, of Morris, James, Hitchens
& Williams LLP, special Delaware counsel to FPL and Florida Power &
Light Company Trust I.
5(d) - Opinion and Consent, dated June 8, 2004, of Morris, James, Hitchens
& Williams LLP, special Delaware counsel to FPL and Florida Power &
Light Company Trust II.
23(a) - Independent Auditors' Consent of Deloitte & Touche LLP.
23(b) - Consent of Steel Hector & Davis LLP (included in opinion, attached
hereto as Exhibit 5(a)).
23(c) - Consent of Thelen Reid & Priest LLP (included in opinion, attached
hereto as Exhibit 5(b)).
23(d) - Consent of Morris, James, Hitchens & Williams LLP (included in
opinion, attached hereto as Exhibit 5(c)).
23(e) - Consent of Morris, James, Hitchens & Williams LLP (included in
opinion, attached hereto as Exhibit 5(d)).
24 - Power of Attorney (included on the signature page of this
registration statement).
25(a) - Statement of Eligibility on Form T-1 of Deutsche Bank Trust Company
Americas with respect to the Mortgage.
25(b) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Subordinated Indenture Trustee with respect to the Junior Subordinated
Debentures.
25(c) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Property Trustee, with respect to the Amended and Restated Trust
Agreement of Florida Power & Light Company Trust I.
25(d) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Property Trustee, with respect to the Amended and Restated Trust
Agreement of Florida Power & Light Company Trust II.
25(e) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Preferred Trust Securities Guarantee Trustee, with respect to the
Preferred Trust Securities Guarantee Agreement of Florida Power &
Light Company Trust I.
25(f) - Statement of Eligibility on Form T-1 of The Bank of New York, as
Preferred Trust Securities Guarantee Trustee, with respect to the
Preferred Trust Securities Guarantee Agreement of Florida Power &
Light Company Trust II.