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| RGA > SEC Filings for RGA > Form 8-K on 5-Jun-2008 | All Recent SEC Filings |
5-Jun-2008
Entry into a Material Definitive Agreement
The class A common stock and class B common stock will vote together as a
single class, except with respect to certain limited matters required by
Missouri law, and except that:
• the holders of RGA class A common stock, voting together as a single class,
will be entitled to elect no more than 20% of the directors of RGA;
• the holders of RGA class B common stock, voting together as a single class,
will be entitled to elect at least 80% of the directors of RGA; and
• holders of 15% or more of the RGA class B common stock will have reduced
voting power with respect to directors if they do not also hold an equal or
greater proportion of RGA class A common stock.
Additionally, as part of the Recapitalization, the articles of incorporation
of RGA will be amended to adopt stock ownership limitations, which would
generally limit RGA shareholders from owning 5% or more (by value) of RGA stock
for a period of 36 months and one day from the closing of the Split-Off (it
being understood that such limitation, among other things, (i) would not apply
to MetLife or its subsidiaries, (ii) would not apply to any participating banks
that may participate in any debt exchanges related to the Split-Off and
(iii) would not prohibit a person from receiving 5% or more (by value) of RGA
stock as a result of the divestiture). Any person permitted to acquire or own 5%
or more (by value) of RGA stock pursuant to the three exceptions described in
the immediately preceding sentence will not be permitted to acquire any
additional RGA stock at any time during the 36 month and one day restrictive
period, unless and until such person owns less than 5% (by value) of RGA stock,
at which point such person may acquire RGA stock only to the extent that, after
such acquisition, such person owns less than 5% (by value) of RGA stock.
In addition, as previously reported in the Company's Current Report on Form
8-K filed on June 2, 2008, RGA has adopted a Section 382 shareholder rights
plan, the ratification of which is proposed in connection with the
Recapitalization.
The Split-Off
Immediately following the Recapitalization, MetLife and its subsidiaries will
divest all or substantially all of their shares of RGA class B common stock
through the Split-Off. The Split-Off will be effected through an exchange offer
(the "Offer") in which MetLife will offer to acquire outstanding shares of
MetLife common stock from MetLife stockholders to exchange, in a tax-free
transaction, all of the shares of RGA class B common stock held by MetLife and
its subsidiaries. The Offer will be made by MetLife only during customary
trading periods, provided that at least 25 business days remain available during
such a period (subject to MetLife's market-related delay right and three
discretionary delay rights, and both parties' ability to delay commencement or
to suspend the Offer under certain circumstances).
Commencement of the Offer is subject to certain conditions (the "Commencement
Conditions"), including: (1) satisfaction of the conditions to completion of the
Recapitalization (the completion of the Recapitalization and the Split-Off being
cross-conditioned on the other); (2) no adverse change, revocation or amendment
to the IRS ruling, as supplemented, with respect to the Divestiture; (3) the
effectiveness of the registration statement on Form S-4 for the Recapitalization
and Split-Off, (4) the accuracy of representations and warranties,
(5) performance in all material respects of all obligations under the
Recapitalization and Distribution Agreement, (6) no person qualifying or
otherwise becoming an "acquiring person" under RGA's Section 382 Shareholders
Rights Plan (discussed in Item 3.01 below); and (7) the absence of certain laws
or orders of governmental authorities prohibiting the Divestiture. In addition,
it is a condition to MetLife's obligation to complete the Offer that, if the
Offer is not completed by November 11, 2008, MetLife will have received a
supplemental IRS private letter ruling to the effect that it either may exchange
the Recently Acquired Shares for RGA class B common stock and distribute such
shares in the Divestiture or retain the Recently Acquired Shares as RGA class A
common stock.
MetLife has the ability to delay commencement of the Offer under certain
circumstances due to market conditions or on three separate occasions in its
discretion. Both parties have the ability to delay commencement or to suspend
the Offer due to disclosure considerations.
The exchange ratio for the Offer will be set by MetLife, provided that
MetLife has agreed to select an exchange ratio that it believes in good faith,
after consultation with its financial advisors, is reasonably likely to result
in the minimum tender condition being satisfied. The minimum tender condition
established by MetLife is the number of shares of MetLife common stock that,
when tendered, would result in at least 90% of the RGA class B common stock held
by MetLife being distributed in the Split-Off.
The completion of the Recapitalization and the Split-Off are cross
conditioned on each other, so neither the Recapitalization nor the Split-Off
will occur unless both occur. In addition, the completion of the
Recapitalization and the Split-Off are subject the satisfaction or waiver of the
conditions set forth in the Recapitalization and Distribution Agreement,
including (1) continued satisfaction of the conditions to commencing the Offer;
(2) approval of the Recapitalization and certain related RGA governance
proposals by the RGA shareholders (including by holders of a majority of the RGA
common stock present at the meeting not held by MetLife and its subsidiaries);
(3) the tender of a number of shares of Metlife common stock satisfying the
minimum tender condition (no set forth above); and (4) delivery of certain legal
opinions and tax opinions from counsel to the parties to the Agreement.
In addition, it is a condition to RGA's obligation to complete the
Recapitalization that, if the Offer is not completed by November 11, 2008,
MetLife will have received a supplemental IRS private letter ruling to the
effect that MetLife can continue to retain the Recently Acquired Shares as RGA
class A common stock. If MetLife receives a supplemental IRS private letter
ruling providing that it may exchange the Recently Acquired Shares and
distribute such shares in the Divestiture (but not that it may retain the
Recently Acquired Shares), RGA can decide whether or not to waive the condition
set forth in the immediately preceding sentence.
Additional Divestiture Transactions
To the extent that MetLife holds any RGA class B common stock after the
Split-Off, MetLife will dispose of such RGA class B common stock in one or more
public or private Debt Exchanges and/or one or more Subsequent Split-Offs, thus
completing the Divestiture on or prior to the first anniversary of the
completion of the Split-Off. The shares of RGA class B common stock distributed
by MetLife pursuant to the Split-Off, any Debt Exchanges and any Subsequent
Split-offs will constitute 100% of the RGA class B common stock that MetLife and
its subsidiaries will receive in connection with the Recapitalization.
Covenants
Each of RGA and MetLife has agreed to various covenants under the
Recapitalization and Distribution Agreement. In particular, RGA has undertaken
covenants in respect of its interim operations, including with respect to
amendments to its organizational documents, adoption of certain plans of
liquidation or dissolution, making certain changes to its line of business or
effecting certain issues, sales, grants, purchases, redemptions or other
acquisitions or disposals of its own securities, or granting certain options
over them. In addition, RGA has granted MetLife certain registration rights with
respect to the Recently Acquired Shares.
Further, RGA and MetLife have each agreed, subject to an exception, prior to
approval of the Recapitalization and transactions contemplated thereby by RGA
shareholders, not to (i) solicit proposals relating to certain alternative
business combination transactions or (ii) subject to certain exceptions, enter
into discussions or negotiations concerning, or providing confidential
information in connection with, certain alternative business combination
transactions. MetLife is permitted to submit such an alternative proposal to
acquire all of RGA's equity securities or consolidated assets pursuant to which
all RGA shareholders would be entitled to receive the same consideration on a
per share basis on the same terms and conditions.
MetLife has agreed to certain standstill limitations until completion of the
Split-Off. MetLife has also agreed to vote its shares of RGA stock in favor of
the Recapitalization and transactions contemplated thereby at the RGA
shareholder meeting and, after completion of the Split-Off, to vote in any
election of directors, its shares of class A common stock or class B common
stock in proportion to the other holders of that class, and, in all other
matters, in proportion to the votes cast by the other holders, taken together as
a whole.
The Recapitalization and Distribution Agreement provides for reciprocal
indemnification and contribution, as well as provisions for indemnification and
contribution with respect to disclosure-related matters. Except in certain
specified circumstances, RGA has agreed to indemnify MetLife for any taxes and
tax-related losses (including losses resulting from certain claims by MetLife
stockholders that exchange shares of MetLife common stock in the Split-Off) that
MetLife incurs as a result of the Divestiture failing to qualify as tax-free
under Section 355 of the Internal Revenue Code (such taxes and tax-related
losses, "RGA Section 355 Taxes"), if the taxes and tax-related losses result
solely from any breach of, or inaccuracy in, any representation, covenant or
obligation of RGA under the Recapitalization and Distribution Agreement or the
RGA tax certificate to be delivered in connection with the tax opinion. MetLife
is responsible for, and will indemnify RGA for, any taxes or tax-related losses
that result from the Divestiture failing to qualify as tax-free under
Section 355 of the Internal Revenue Code other than the RGA Section 355 Taxes.
Regardless of whether or not any of the transactions contemplated by the
Recapitalization and Distribution Agreement are completed, MetLife has agreed to
reimburse RGA for its out-of-pocket expenses incurred in connection with or
arising out of the transactions contemplated by the Recapitalization and
Distribution Agreement; provided that, in the event that the divestiture is
completed, MetLife's reimbursement obligation will be subject to any limit set
forth in the IRS ruling, as it may be amended by any supplemental IRS ruling.
Additionally, MetLife has agreed to reimburse RGA for certain increases in
shareholder servicing costs over an agreed-upon threshold for a period of four
years following completion of the Split-Off.
Termination
The Recapitalization and Distribution Agreement may be terminated prior to
completion of the Recapitalization and Split-Off by either party upon, among
other things, their mutual written consent, the failure of the RGA shareholders
to approve the Recapitalization and Distribution Agreement, the Recapitalization
or the related RGA proposals or the failure of the Split-Off conditions to be
satisfied by December 31, 2009. MetLife may also terminate the Recapitalization
and Distribution Agreement to execute a binding written agreement with a
specific third party providing for certain transactions that the MetLife board
of directors determines in good faith, after consultation with MetLife's
financial and outside legal advisors, are more favorable to MetLife than the
transactions contemplated by the Recapitalization and Distribution Agreement.
The foregoing description of the Recapitalization, Split-Off and the
Recapitalization and Distribution Agreement does not purport to be complete and
is qualified in its entirety by reference to the complete text of the
Recapitalization and Distribution Agreement, which is attached as Exhibit 2.1
hereto and incorporated herein by reference.
The Recapitalization and Distribution Agreement has been included to provide
investors and shareholders with information regarding its terms. It is not
intended to provide any other factual information about RGA or MetLife. The
Recapitalization and Distribution Agreement contains representations and
warranties that the parties to the Recapitalization and Distribution Agreement
made to and solely for the benefit of each other. The assertions embodied in
such representations and warranties are qualified by information contained in
confidential disclosure letters that the parties exchanged in connection with
signing the Recapitalization and Distribution Agreement. These disclosure
letters contain information that modifies, qualifies and creates exceptions to
the representations and warranties set forth in the Recapitalization and
Distribution Agreement. Moreover, the representations and warranties in the
Recapitalization and Distribution Agreement (1) are subject to a contractual
standard of materiality or material adverse effect contained in the
Recapitalization and Distribution Agreement which may differ from that generally
applicable to public disclosures to shareholders, (2) in certain cases, were
used for the purpose of allocating risk among the parties rather than
establishing matters as facts, and (3) were only made as of the date of the
Recapitalization and Distribution Agreement and are modified in important part
by the underlying disclosure letters. Accordingly, investors and shareholders
should not rely on such representations and warranties as characterizations of
the actual state of facts or circumstances. Moreover, information concerning the
subject matter of such representations and warranties may change after the date
of the Recapitalization and Distribution Agreement, which subsequent information
may or may not be fully reflected in RGA's or MetLife's public disclosures. The
representations and warranties in the Recapitalization and Distribution
Agreement and the description of them in this document should be read in
conjunction with the other information contained in the reports, statements and
filings that the parties publicly file with the SEC.
The disclosure in Item 3.03 regarding the Rights Agreement (defined in
Item 3.03) is incorporated by reference into this Item 1.01.
Additional Information and Where to Find It
In connection with MetLife's proposed divestiture of its stake in RGA, RGA has
filed with the U.S. Securities and Exchange Commission (SEC) a registration
statement on Form S-4 (File No. 333-151390),
which includes a preliminary proxy statement/prospectus related to the
Recapitalization and a preliminary prospectus relating to the Split-Off. At the
appropriate time, MetLife will file with the SEC a statement on Schedule TO.
Investors and holders of RGA and MetLife securities are strongly encouraged to
read the registration statement and any other relevant documents filed with the
SEC, including the final proxy statement/prospectus relating to the
Recapitalization, the final prospectus relating to the Split-Off and related
Split-Off materials and the tender offer statement on Schedule TO (when
available), as well as any amendments and supplements to those documents,
because they will contain important information about RGA, MetLife, and the
proposed transactions. The final proxy statement/prospectus relating to the
Recapitalization and related transactions will be mailed to shareholders of RGA
and the final prospectus relating to the Split-Off, related split-off materials
and the tender offer statement on Schedule TO will be mailed to stockholders of
MetLife. Investors and security holders will be able to obtain free copies of
the registration statement, the final proxy statement/prospectus relating to the
Recapitalization and the final prospectus relating to the Split-Off and related
Split-Off materials and the tender offer statement on Schedule TO (when
available) as well as other filed documents containing information about MetLife
and RGA, without charge, at the SEC's web site (www.sec.gov). Free copies of
RGA's filings also may be obtained by directing a request to RGA, Investor
Relations, by phone to (636) 736-7243, in writing to Mr. John Hayden, Vice
President-Investor Relations, Reinsurance Group of America, Incorporated, 1370
Timberlake Manor Parkway, Chesterfield, Missouri, 63017, or by email to
investrelations@rgare.com. Free copies of MetLife's filings may be obtained by
directing a request to MetLife, Investor Relations, by phone to (212) 578-2211,
in writing to MetLife, Inc., 1 MetLife Plaza, Long Island City, NY 11101, or by
email to metir@metlife.com. Neither RGA, MetLife nor any of their respective
directors or executive officers or any dealer manager, if any, that may be
appointed with respect to the Split-Off makes any recommendation as to whether
you should participate in the Split-Off.
This communication shall not constitute an offer to sell or the solicitation of
an offer to buy securities, nor shall there be any sale of securities in any
jurisdiction in which such solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of such jurisdiction.
Such an offer may be made solely by a prospectus meeting the requirements of
Section 10 of the U.S. Securities Act of 1933, as amended. Accordingly, neither
the proxy solicitation for the Recapitalization nor the Offer for the
outstanding shares of MetLife common stock pursuant to the Split-Off described
in this communication has commenced. At the time that the contemplated Split-Off
is commenced, MetLife will file a statement on Schedule TO with the SEC. The
distribution of this communication may, in some countries, be restricted by law
or regulation. Accordingly, persons who come into possession of this document
should inform themselves of and observe these restrictions.
Participants in the Solicitation
RGA, MetLife and their respective directors and executive officers may be
deemed, under SEC rules, to be participants in the solicitation of proxies from
RGA's shareholders with respect to the proposed transaction. Information
regarding the directors and executive officers of RGA is included in its
definitive proxy statement for its 2008 Annual Meeting of Shareholders filed
with the SEC on April 9, 2008. Information regarding the directors and officers
of MetLife is included in the definitive proxy statement for MetLife's 2008
Annual Meeting of Shareholders filed with the SEC on March 18, 2008. More
detailed information regarding the identity of potential participants, and their
direct or indirect interests, by securities holdings or otherwise, is set forth
in the registration statement filed with the SEC on June 3, 2008, the proxy
statement/prospectus relating to the
Recapitalization, the prospectus relating to the Split-Off and other materials
to be filed with the SEC in connection with the proposed transactions.
Item 3.03. Material Modification to Rights of Security Holders.
On June 1, 2008, the RGA Board of Directors of declared a dividend of one
preferred share purchase right (a "Right") for each outstanding share of common
stock, par value $.01 per share, of RGA (the "Common Stock"). The dividend
distribution is payable on June 12, 2008 (the "Record Date") to the shareholders
of record as of the close of business on that date. Each Right entitles the
registered holder to purchase from RGA one one-hundredth of a share of
Series A-1 Junior Participating Preferred Stock, par value $0.01 per share (the
"Preferred Stock"), of RGA at a price of $200 per one one-hundredth of a share
of Preferred Stock (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in a Section 382 Rights
Agreement, dated as of June 2, 2008, as the same may be amended from time to
time (the "Rights Agreement"), between RGA and Mellon Investor Services LLC, as
Rights Agent (the "Rights Agent").
The Rights Plan is intended to act as a deterrent to any person (other than
RGA, any subsidiary of RGA or any employee benefit plan of RGA) from becoming or
obtaining the right to become, a 5% Shareholder (as defined in Section 382 of
the Internal Revenue Code of 1986, as amended (the "Code")) without the approval
of at least a majority of the members of our Board of Directors then in office
(any such person who becomes a 5% Shareholder, other than as described below, an
"Acquiring Person"). Notwithstanding the foregoing, shareholders who own 5.0% or
more (by value) of outstanding RGA (i) Common Stock, (ii) preferred stock (other
than preferred stock described in Section 1504(a)(4) of the Code), and (iii) any
other interest that would be treated as "stock" pursuant to Treasury Regulation
§ 1.382-2T(f)(18), "Corporation Securities"), applying certain constructive
ownership and attribution rules, as of the close of business on June 2, 2008
will not be an Acquiring Person and therefore will not trigger the Rights Plan,
so long as they do not acquire any additional shares (other than acquisitions as
a result of the exercise of options or warrants granted by the RGA or certain
internal distributions between MetLife and its subsidiaries). In addition,
persons who become a 5% Shareholder in connection with certain transactions
taken pursuant to the Recapitalization and Distribution Agreement, dated as of
June 1, 2008 (the "Recapitalization and Distribution Agreement"), by and between
RGA and MetLife Inc. (together with its subsidiaries, "MetLife"), will not be an
Acquiring Person and will not trigger the Rights Plan, including persons who
become 5% Shareholders as a result of the distribution of RGA class B common
stock in the Split-Off, or in any debt exchanges or additional split-offs
("Additional Divestiture Transactions"), contemplated by the Recapitalization
and Distribution Agreement (although the Rights Plan does not exempt any future
acquisitions of Corporation Securities by such persons (other than in subsequent
Additional Divestiture Transactions or in acquisitions exempted by RGA).
Any Rights held by an Acquiring Person are void and may not be exercised. The
RGA Board of Directors may, in its sole discretion, exempt any person or group
from being deemed an Acquiring Person for purposes of the Rights Plan at any
time prior to the time the rights are no longer redeemable.
Until the earlier to occur of (i) the close of business on the tenth business
day following the date of public announcement or the date on which RGA first has
notice or determines that a person has become an Acquiring Person (as defined
above) without the prior express written consent of RGA executed on behalf of
RGA by a duly authorized officer of RGA following
express approval by action of at least a majority of the members of the Board of
Directors then in office (the "Stock Acquisition Date"), or (ii) the close of
business on the tenth business day (or such later date as may be determined by
action of the Board of Directors but not later than the Stock Acquisition Date)
following the commencement of a tender offer or exchange offer to acquire
Corporation Securities, without the prior written consent of RGA, by a person
(other than RGA, any subsidiary of RGA or an employee benefit plan of RGA)
which, upon consummation, would result in such party's becoming an Acquiring
Person (the earlier of the dates in clause (i) or (ii) above being called the
"Distribution Date"), the Rights will be evidenced, with respect to any of the
Common Stock certificates outstanding as of the Record Date, by such Common
Stock certificates.
The Rights Agreement provides that, until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights will be transferred with and
only with RGA's Common Stock. Until the Distribution Date (or earlier
. . .
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