| Item 2.03 |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
On March 4, 2025 (the “Closing Date”), pursuant to the Purchase Agreement among MetLife, Inc. (the “Company”), 200 Park Funding Trust, a Delaware statutory trust (the “Trust”), and TD Securities (USA) LLC, Barclays Capital Inc., BofA Securities, Inc., Goldman Sachs & Co. LLC and Wells Fargo Securities, LLC, as representatives of the several initial purchasers, the Trust completed the issuance and sale of 1,250,000 of its Pre-Capitalized Trust Securities redeemable February 15, 2055 (the “P-Caps”) for an aggregate purchase price of $1,250,000,000 in private placements pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), as a contingent funding arrangement that provides the Company the right at any time over a thirty-year period to issue its 5.740% Senior Notes due 2055 (the “Senior Notes”) to the Trust, at its election, as described below. The P-Caps do not carry registration rights and may be held only by “qualified institutional buyers”, as defined in Rule 144A under the Securities Act, that are also “qualified purchasers” for purposes of Section 3(c)(7) of the Investment Company Act of 1940, as amended (the “Act”). The Trust invested the proceeds from the sale of the P-Caps in a portfolio of principal and interest strips of U.S. Treasury securities (the “Eligible Assets”).
On the Closing Date, the Company entered into a facility agreement (the “Facility Agreement”) with the Trust and The Bank of New York Mellon Trust Company, N.A., as notes trustee for the Senior Notes. The Facility Agreement provides that the Trust grants the Company the right to require the Trust to purchase, on one or more occasions, from the Company (the “Issuance Right”) Senior Notes in an aggregate principal amount at any one time outstanding and held by the Trust, of up to $1,250,000,000 aggregate principal amount. The Company has agreed to pay to the Trust a semi-annual facility fee calculated at a rate of 1.2373% per annum, applied to the unexercised portion of the Issuance Right. The Company may direct the Trust to grant the right to exercise the Issuance Right with respect to all or a designated amount of the Senior Notes to one or more assignees (who are consolidated subsidiaries of the Company or persons to whom the Company has an obligation) (each, an “Issuance Right Assignee”), who may cause the Senior Notes to be issued to the Trust and receive the corresponding portion of Eligible Assets that would otherwise have been delivered to the Company pursuant to the exercise of such Issuance Right. On the Closing Date, the Company also entered into a trust expense reimbursement agreement with the Trust, pursuant to which the Company agreed to reimburse the Trust for its expenses in connection with the transaction, including trustees’ fees.
The Issuance Right will be exercised automatically in full if (1) the Company fails to pay the facility fee under the Facility Agreement when due or any amount due and owing under the trust expense reimbursement agreement on any distribution date or fails on any distribution date to purchase and pay for any Eligible Assets that are due and unpaid on such distribution date and are required to be purchased at their face amount from the Trust pursuant to the terms of the Facility Agreement and such failure is not cured (including payment in full of the special facility fee due as a result of such failure) within 30 days of such distribution date or (2) upon certain bankruptcy events involving the Company. The Company will be required to exercise the Issuance Right in full if (1) it reasonably believes that its consolidated net worth, determined in accordance with U.S. GAAP, but excluding accumulated other comprehensive income (or loss) and equity of non-controlling interests attributable thereto, has fallen below $10 billion, which amount may be adjusted from time to time upon the occurrence of certain specified events, (2) an event of default under the indenture that governs the Senior Notes has occurred or would have occurred had the Senior Notes been outstanding, or (3)(A) certain events relating to the Trust’s status as an “investment company” under the Act, are reasonably likely to occur or have occurred and (B)(x) within five business days of such determination, the transaction agreements have not been amended to prevent or cease such event or (y) it has been reasonably determined that no such amendment is possible. In addition, at any time following exercise of the Issuance Right in whole or in part, other than upon a redemption, an automatic exercise or a required exercise as described in this paragraph, the Company will have the right to repurchase any or all of the Senior Notes then held by the Trust in exchange for Eligible Assets that entitle the Trust to receive payments of principal and interest in the same amounts as the Trust would have received on the Eligible Assets that it delivered to the Company or any Issuance Right Assignee upon the exercise of the Issuance Right in respect of the Senior Notes to be so repurchased.
