SEC Company Response from Brighthouse Financial, (BHF) — Jun 22, 2017
Brighthouse Financial, Inc.
Date: June 22, 2017 · CIK: 0001685040 · Accession: 0001193125-17-210858
AI Filing Summary & Sentiment
File numbers found in text: 001-37905
Letter
Via EDGAR and E-mail Division of Corporation Finance Attention: Suzanne Hayes Office of Healthcare and Insurance Re: Brighthouse Financial, Inc. Amendment No. 3 to Form 10-12B Filed June 2, 2017 File No. 001-37905
Dear Ms. Hayes:
This letter responds to the comments set forth in the letter, dated June 13, 2017, to Anant Bhalla, Chief Financial Officer of Brighthouse Financial, Inc. (the “Company” or “we”), from the staff of the Division of Corporation Finance (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) regarding the above-referenced Amendment No. 3 to the registration statement on Form 10 filed with the Commission on June 2, 2017 (the “Registration Statement”).
Concurrently with this letter, the Company is electronically transmitting Amendment No. 4 to the Registration Statement (the “Amendment”), which Amendment includes an amended Information Statement as Exhibit 99.1 (the “Information Statement”), for filing under the Securities Exchange Act of 1934, as amended. The Amendment includes revisions made in response to the comments of the Staff as well as other changes. We have enclosed for your convenience one copy of the Amendment that has been marked to show changes made to Amendment No. 3 to the Registration Statement.
Each of the Staff’s comments is set forth in bold, followed by the Company’s response to each comment. As a result of the revisions to the Registration Statement, some page references have changed. The page references in the comments refer to the page numbers of the third amendment to the Information Statement and the page references in the responses refer to page numbers in the fourth amendment to the Information Statement. Capitalized terms used herein but not otherwise defined have the meanings assigned to them in the Amendment.
Exhibit 99.1 — Information Statement
Forward-Looking Statements
1. Please note that the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995 (PSLRA) applies to issuers that are subject to the reporting requirements of section 13(a) or section 15(d) of the Securities Exchange Act of 1934 at the time the statements are made. Please revise to remove the implication that the statements in both letters to shareholders are within the protection of the PSLRA or tell us why you believe that the safe harbor is available to you.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 2
Response: The Company has revised the text of each of the Chief Executive Officers’ letters to shareholders as highlighted below (changes from the previous text in bold, underlined or struckthrough text):
Letter from Steven A. Kandarian to MetLife shareholders:
Forward-Looking Statements
This letter may contain or incorporate by reference information that includes or is based upon forward-looking statements [within the meaning of the Private Securities Litigation Reform Act of 1995]. Forward-looking statements give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words such as “will,” “expect,” “become,” “remain,” “believe,” “plan,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.
Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of MetLife, Inc., its subsidiaries and affiliates. These statements are based on current expectations and the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors identified in MetLife, Inc.’s most recent Annual Report on Form 10-K (the “Annual Report”) filed with the U.S. Securities and Exchange Commission (the “SEC”), any Quarterly Reports on Form 10-Q filed by MetLife, Inc. with the SEC after the date of the Annual Report under the captions “Note Regarding Forward-Looking Statements” and “Risk Factors,” and other filings MetLife, Inc. makes with the SEC. MetLife, Inc. does not undertake any obligation to publicly correct or update any forward-looking statement if MetLife, Inc. later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures MetLife, Inc. makes on related subjects in reports to the SEC.
Letter from Eric T. Steigerwalt to Future Brighthouse Financial Shareholders:
Forward-Looking Statements
This letter may contain or incorporate by reference information that includes or is based upon forward-looking statements [within the meaning of the Private Securities Litigation Reform Act of 1995]. Forward-looking statements give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words such as “will,” “seek,” “intend,” “over time,” “aim,” “believe,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.
Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of Brighthouse Financial, Inc., its subsidiaries and affiliates. These statements are based on current expectations and the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors identified in Brighthouse Financial, Inc.’s disclosures filed with the U.S. Securities and Exchange Commission (the “SEC”). Brighthouse Financial, Inc. does not undertake any obligation to publicly correct or update any forward-looking statement if Brighthouse Financial, Inc. later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures Brighthouse Financial, Inc. makes on related subjects in reports to the SEC.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 3
MetLife U.S. Retail Separation Business
Notes to Combined Financial Statements
1. Business, Basis of Presentation and Summary of Significant Accounting Policies
Stock-Based Compensation, page F-32
2. We note your response to revised comment 6, as provided to you by the staff on a call on May 23, 2017, and the revised disclosures in the filing. Regarding stock-compensation expense, please tell us the expected impact on your financial statements upon the separation and, if material, quantify in the notes to the pro forma information and elsewhere as appropriate pursuant to Rule 11-02(b)(5) of Regulation S-X.
Response: The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, the separation, being the disaffiliation of the Company from MetLife, will constitute the end of the Company’s employees’ employment with MetLife and its affiliates. Accordingly, Company employees who have satisfied MetLife service requirements on or before that date will retain their awards or otherwise will forfeit those awards according to their terms.
The Company intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation. Accordingly, the Company would incur costs for such compensation over time if and as employees satisfied such service requirements. The Company does not expect such costs to be material.
The Company has expanded the disclosures in the Information Statement as highlighted below (changes from the previous text in bold, underlined or struckthrough text):
Executive Compensation Program – Page 292
Our executive officers have participated in MetLife stock-based compensation plans, the costs of which have been allocated to the Company and recorded in the combined statements of operations. The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, [W]we anticipate that our separation from MetLife, being the disaffiliation of the Company from MetLife, will constitute the end of our employees’ employment with MetLife and its affiliates, and that their MetLife stock compensation awards will be retained or forfeited according to their terms. Accordingly, as of the separation those awards will have either been forfeited or fully expensed.
The Company intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation. The Company does not expect such costs to be material.
We also anticipate that, in accordance with the requirements of the plans, the MetLife Board or an appropriate committee will determine what adjustments, if any, to make to outstanding awards and the number of shares reserved for issuance under MetLife’s stock compensation plans in order to prevent the dilution or enlargement of participants’ rights under the plans.
Other Related Person Transactions – Page 311
Stock-Based Compensation Plans
Our employees have participated in MetLife, Inc. stock-based compensation plans, the costs of which have been allocated to us and recorded in the combined statements of operations. The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, [W]we anticipate that our separation from MetLife, being the disaffiliation of the Company from MetLife, will constitute the end of our employees’ employment with MetLife and its affiliates, and that their MetLife stock compensation awards will be retained or forfeited according to their terms. Accordingly, as of the separation those awards will have either been forfeited or fully expensed.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 4
The Company intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation. The Company does not expect such costs to be material.
We also anticipate that, in accordance with the requirements of the plans, the MetLife Board or an appropriate committee will determine what adjustments, if any, to make to outstanding awards and the number of shares reserved for issuance under MetLife’s stock compensation plans in order to prevent the dilution or enlargement of participants’ rights under the plans.
MetLife U.S. Retail Separation Business
Notes to the Interim Condensed Combined Financial Statements (Unaudited)
9. Related Party Transactions – Page F-226
Stock-Based Compensation Plans
The Company’s employees have participated in MetLife, Inc. stock-based compensation plans, the costs of which have been allocated to the Company and recorded in the combined statements of operations. The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, [T]the Company anticipates that its separation from MetLife, being the disaffiliation of the Company from MetLife, will constitute the end of its employees’ employment with MetLife and its affiliates, and that their MetLife stock compensation awards will be retained or forfeited according to their terms. Accordingly, as of the separation those awards will have either been forfeited or fully expensed.
The Company intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation.
The Company also anticipates that, in accordance with the requirements of the plans, the MetLife Board or an appropriate committee will determine what adjustments, if any, to make to outstanding awards and the number of shares reserved for issuance under MetLife’s stock compensation plans in order to prevent the dilution or enlargement of participants’ rights under the plans.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 5
Please contact me at (980) 949-3626 with any questions you may have regarding the Registration Statement. Electronic mail transmissions may be sent to me at cdebiase@brighthousefinancial.com and facsimile transmissions may be sent to my attention at (212) 251-1546.
Sincerely,
/s/ Christine M. DeBiase
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SEC Response Letter
Christine M. DeBiase
General
Counsel and Corporate Secretary
Brighthouse Financial, Inc.
Gragg Building
11225 North Community House Road
Charlotte, North Carolina 28277
Tel (980) 949-3626
Fax (212) 251-1546
June 22, 2017
Via EDGAR and E-mail
U.S. Securities and Exchange
Commission
Division of Corporation Finance
100 F Street
N.E.
Washington D.C. 20549
Attention:
Suzanne Hayes
Assistant Director
Office of Healthcare and Insurance
Re:
Brighthouse Financial, Inc.
Amendment No. 3 to Form 10-12B
Filed June 2, 2017
File No. 001-37905
Dear Ms. Hayes:
This letter responds to the comments set forth in the letter, dated June 13, 2017, to Anant Bhalla, Chief Financial Officer of Brighthouse
Financial, Inc. (the “Company” or “we”), from the staff of the Division of Corporation Finance (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”)
regarding the above-referenced Amendment No. 3 to the registration statement on Form 10 filed with the Commission on June 2, 2017 (the “Registration Statement”).
Concurrently with this letter, the Company is electronically transmitting Amendment No. 4 to the Registration Statement (the
“Amendment”), which Amendment includes an amended Information Statement as Exhibit 99.1 (the “Information Statement”), for filing under the Securities Exchange Act of 1934, as amended. The Amendment includes
revisions made in response to the comments of the Staff as well as other changes. We have enclosed for your convenience one copy of the Amendment that has been marked to show changes made to Amendment No. 3 to the Registration Statement.
Each of the Staff’s comments is set forth in bold, followed by the Company’s response to each comment. As a result of the revisions
to the Registration Statement, some page references have changed. The page references in the comments refer to the page numbers of the third amendment to the Information Statement and the page references in the responses refer to page numbers in the
fourth amendment to the Information Statement. Capitalized terms used herein but not otherwise defined have the meanings assigned to them in the Amendment.
Exhibit 99.1 — Information Statement
Forward-Looking Statements
1.
Please note that the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995 (PSLRA) applies to issuers that are subject to the reporting requirements of section
13(a) or section 15(d) of the Securities Exchange Act of 1934 at the time the statements are made. Please revise to remove the implication that the statements in both letters to shareholders are within the protection of the PSLRA or tell us why you
believe that the safe harbor is available to you.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 2
Response: The Company has revised the text of each of the Chief Executive Officers’
letters to shareholders as highlighted below (changes from the previous text in bold, underlined or struckthrough text):
Letter from
Steven A. Kandarian to MetLife shareholders:
Forward-Looking Statements
This letter may contain or incorporate by reference information that includes or is based upon forward-looking statements [within
the meaning of the Private Securities Litigation Reform Act of 1995]. Forward-looking statements give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to
historical or current facts. They use words such as “will,” “expect,” “become,” “remain,” “believe,” “plan,” and other words and terms of similar meaning, or are tied to future periods, in
connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or
products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.
Any
or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of MetLife, Inc.,
its subsidiaries and affiliates. These statements are based on current expectations and the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future
performance. Actual results could differ materially from those expressed or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors
identified in MetLife, Inc.’s most recent Annual Report on Form 10-K (the “Annual Report”) filed with the U.S. Securities and Exchange Commission (the “SEC”), any Quarterly Reports on Form 10-Q filed by MetLife, Inc. with
the SEC after the date of the Annual Report under the captions “Note Regarding Forward-Looking Statements” and “Risk Factors,” and other filings MetLife, Inc. makes with the SEC. MetLife, Inc. does not undertake any obligation to
publicly correct or update any forward-looking statement if MetLife, Inc. later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures MetLife, Inc. makes on related subjects in reports to the SEC.
Letter from Eric T. Steigerwalt to Future Brighthouse Financial Shareholders:
Forward-Looking Statements
This
letter may contain or incorporate by reference information that includes or is based upon forward-looking statements [within the meaning of the Private Securities Litigation Reform Act of 1995]. Forward-looking statements
give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words such as “will,” “seek,” “intend,”
“over time,” “aim,” “believe,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include
statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in
operations and financial results.
Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate
assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of Brighthouse Financial, Inc., its subsidiaries and affiliates. These statements are based on current
expectations and the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed
or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors identified in Brighthouse Financial, Inc.’s disclosures filed with the
U.S. Securities and Exchange Commission (the “SEC”). Brighthouse Financial, Inc. does not undertake any obligation to publicly correct or update any forward-looking statement if Brighthouse Financial, Inc. later becomes aware that such
statement is not likely to be achieved. Please consult any further disclosures Brighthouse Financial, Inc. makes on related subjects in reports to the SEC.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 3
MetLife U.S. Retail Separation Business
Notes to Combined Financial Statements
1. Business,
Basis of Presentation and Summary of Significant Accounting Policies
Stock-Based Compensation, page F-32
2.
We note your response to revised comment 6, as provided to you by the staff on a call on May 23, 2017, and the revised disclosures in the filing. Regarding stock-compensation expense, please tell us the expected
impact on your financial statements upon the separation and, if material, quantify in the notes to the pro forma information and elsewhere as appropriate pursuant to Rule 11-02(b)(5) of Regulation S-X.
Response: The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards.
Rather, the separation, being the disaffiliation of the Company from MetLife, will constitute the end of the Company’s employees’ employment with MetLife and its affiliates. Accordingly, Company employees who have satisfied MetLife service
requirements on or before that date will retain their awards or otherwise will forfeit those awards according to their terms.
The Company
intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service
requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation. Accordingly, the Company would incur costs for such compensation over time if and as employees satisfied such service requirements. The Company
does not expect such costs to be material.
The Company has expanded the disclosures in the Information Statement as highlighted below
(changes from the previous text in bold, underlined or struckthrough text):
Executive Compensation Program – Page 292
Our executive officers have participated in MetLife stock-based compensation plans, the costs of which have been allocated to the Company and
recorded in the combined statements of operations. The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, [W]we anticipate
that our separation from MetLife, being the disaffiliation of the Company from MetLife, will constitute the end of our employees’ employment with MetLife and its affiliates, and that their MetLife stock compensation awards will be
retained or forfeited according to their terms. Accordingly, as of the separation those awards will have either been forfeited or fully expensed.
The Company intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife
stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation. The Company does
not expect such costs to be material.
We also anticipate that, in accordance with the requirements of the plans, the MetLife Board
or an appropriate committee will determine what adjustments, if any, to make to outstanding awards and the number of shares reserved for issuance under MetLife’s stock compensation plans in order to prevent the dilution or enlargement of
participants’ rights under the plans.
Other Related Person Transactions – Page 311
Stock-Based Compensation Plans
Our employees have participated in MetLife, Inc. stock-based compensation plans, the costs of which have been allocated to us and recorded in
the combined statements of operations. The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, [W]we anticipate that our
separation from MetLife, being the disaffiliation of the Company from MetLife, will constitute the end of our employees’ employment with MetLife and its affiliates, and that their MetLife stock compensation awards will be retained
or forfeited according to their terms. Accordingly, as of the separation those awards will have either been forfeited or fully expensed.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 4
The Company intends to establish arrangements to pay cash compensation to its employees
related to their forfeiture of certain MetLife stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain
unfulfilled as of the separation. The Company does not expect such costs to be material.
We also anticipate that, in accordance
with the requirements of the plans, the MetLife Board or an appropriate committee will determine what adjustments, if any, to make to outstanding awards and the number of shares reserved for issuance under MetLife’s stock compensation plans in
order to prevent the dilution or enlargement of participants’ rights under the plans.
MetLife U.S. Retail Separation Business
Notes to the Interim Condensed Combined Financial Statements (Unaudited)
9. Related Party Transactions – Page F-226
Stock-Based Compensation Plans
The Company’s employees have participated in MetLife, Inc. stock-based compensation plans, the costs of which have been allocated to the
Company and recorded in the combined statements of operations. The separation will not lapse, accelerate, or waive any Company employee service requirements for MetLife stock compensation awards. Rather, [T]the
Company anticipates that its separation from MetLife, being the disaffiliation of the Company from MetLife, will constitute the end of its employees’ employment with MetLife and its affiliates, and that their MetLife stock
compensation awards will be retained or forfeited according to their terms. Accordingly, as of the separation those awards will have either been forfeited or fully expensed.
The Company intends to establish arrangements to pay cash compensation to its employees related to their forfeiture of certain MetLife
stock compensation caused by the separation. The Company service requirements for such compensation would mirror the service requirements for their forfeited MetLife stock compensation that remain unfulfilled as of the separation.
The Company also anticipates that, in accordance with the requirements of the plans, the MetLife Board or an appropriate committee will
determine what adjustments, if any, to make to outstanding awards and the number of shares reserved for issuance under MetLife’s stock compensation plans in order to prevent the dilution or enlargement of participants’ rights under the
plans.
Ms. Suzanne Hayes
United States Securities and Exchange Commission
June 22, 2017
Page 5
Please contact me at (980) 949-3626 with any questions you may have regarding the
Registration Statement. Electronic mail transmissions may be sent to me at cdebiase@brighthousefinancial.com and facsimile transmissions may be sent to my attention at (212) 251-1546.
Sincerely,
/s/ Christine M. DeBiase
Christine M. DeBiase
Copies to:
Anant Bhalla
Brighthouse Financial, Inc.
Stephen Gauster
MetLife, Inc.
John Schwolsky
Willkie Farr & Gallagher LLP
Benjamin Nixon
Willkie Farr & Gallagher LLP