Debt

9 Months Ended

Sep. 30, 2023

Significant long-term debt issuances and borrowings by subsidiaries of NEP during the nine months ended September 30, 2023 were as follows:

Date Issued/Borrowed

Debt Issuances/Borrowings

Interest
Rate

Principal
Amount

Maturity
Date

(millions)

February 2023 – September 2023

NEP OpCo credit facility

Variable(a)

865

(b)

2028

March 2023

Other long-term debt

Fixed(c)

(c)

April 2023 – September 2023

STX Holdings revolving credit facility

Variable(a)

177

(d)

2024

June 2023

Senior secured limited-recourse debt

Variable(a)

330

(e)

2028

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

(b)At September 30, 2023, approximately $545 million of borrowings were outstanding and $53 million of letters of credit were issued under the NEP OpCo credit facility. Approximately $11 million of the outstanding borrowings have a maturity date in 2025. In October 2023, $85 million was drawn under the NEP OpCo credit facility and $35 million was repaid. See Note 8 – Class B Noncontrolling Interests regarding Class B membership interests in STX Midstream.

(c)See Note 9 – Related Party Long-term Debt.

(d)Borrowings used to fund a portion of the cash used for NEP's repurchase of the Class B noncontrolling membership interests in STX Midstream (see Note 8 – Class B Noncontrolling Interests regarding Class B membership interests in STX Midstream). At September 30, 2023, approximately $177 million of borrowings were outstanding under the STX Holdings revolving credit facility. In October 2023, approximately $60 million was drawn under the STX Holdings revolving credit facility.

(e)Borrowings used to provide funds to repay a portion of the amount outstanding under the revolving credit facility in July 2023.

In February 2023, the loan parties extended the maturity date from February 2027 to February 2028 for essentially all of the NEP OpCo credit facility.

NEP OpCo and its subsidiaries' secured long-term debt agreements are secured by liens on certain assets and contain provisions which, under certain conditions, could restrict the payment of distributions or related party fee payments. At September 30, 2023, NEP and its subsidiaries were in compliance with all financial debt covenants under their financings.

Convertible Notes – In August 2023, as a result of NEP's distribution to common unitholders on August 14, 2023, the conversion ratio of NEP's 2020 convertible notes was adjusted. At September 30, 2023, the conversion rate, which is subject to certain adjustments, was 13.4422 NEP common units per $1,000 of the 2020 convertible notes, which is equivalent to a conversion price of approximately $74.3926 per NEP common unit. At September 30, 2023, the 2020 capped call options have a strike price of $74.3926 and a cap price of $117.7886, subject to certain adjustments. In November 2023, as a result of NEP's distribution authorized by the board of directors (see Note 8 – Distributions), the conversion ratio of NEP's 2021 convertible notes was adjusted. At November 6, 2023, the conversion rate, which is subject to certain adjustments, was 11.3323 NEP common units per $1,000 of the 2021 convertible notes, which is equivalent to a conversion price of approximately $88.2433 per NEP common unit. At November 6, 2023, the 2021 capped call options have a strike price of $88.2433 and a cap price of $110.3038, subject to certain adjustments.

In connection with the issuance of the 2022 convertible notes, NEP entered into a registration rights agreement pursuant to which, among other things, NEP has agreed to file a shelf registration statement with the SEC and use its commercially reasonable efforts to cause such registration statement to become effective on or prior to December 12, 2023, covering resales of NEP common units, if any, issuable upon a conversion of the 2022 convertible notes.

Upon conversion of NEP's convertible notes, NEP will pay cash up to the aggregate principal amount of the notes to be converted and pay or deliver, as the case may be, cash, NEP common units or a combination of cash and common units, at NEP's election, in respect of the remainder, if any, of NEP's conversion obligation in excess of the aggregate principal amount of the notes being converted. At September 30, 2023, NEP does not anticipate issuing common units in connection with a conversion of any of the convertible notes due to the current conversion price of each of the respective convertible notes and NEP having control of how to settle its conversion obligation.