Summary
MetLife Inc. (MET) filed an 8-K on December 30, 2008, to report two significant agreements. The first, an Amended and Restated Credit Agreement dated December 23, 2008, revises an existing credit facility. The total available amount is now $2.85 billion, down from $3 billion, with the reduction attributed to Lehman Brothers Bank's withdrawal. This facility is primarily for general corporate purposes and supporting commercial paper programs, with a maturity initially set for June 20, 2012, but with potential extension options. The second key event is the entry into a Replacement Capital Covenant on December 30, 2008. This covenant, effective until December 31, 2018, restricts MetLife and its subsidiaries from repaying, redeeming, or purchasing certain unsecured long-term indebtedness unless funded by specific replacement capital. This aims to ensure the company maintains a certain level of unsecured long-term debt to support its financial structure.
Key Highlights
- 1MetLife amended and restated its Five-Year Credit Agreement, reducing the facility size to $2.85 billion.
- 2The credit facility is for general corporate purposes and to support commercial paper programs.
- 3Borrowings under the credit agreement must be repaid by June 20, 2012, with potential extensions up to June 20, 2014.
- 4The credit agreement includes covenants such as a consolidated net worth requirement of $27.6 billion (excluding AOCI).
- 5MetLife entered into a Replacement Capital Covenant effective until December 31, 2018.
- 6The covenant restricts the repayment, redemption, or purchase of designated 'Covered Debt' unless funded by specific replacement capital.