MetLife 2003 Annual Report Download - page 86

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METLIFE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
not required. As of December 31, 2003, the maximum amount of the dividend which may be paid to the Holding Company from Metropolitan Property
and Casualty Insurance Company in 2004, without prior regulatory approval, is $200 million.
Stock Compensation Plans
Under the MetLife, Inc. 2000 Stock Incentive Plan (the ‘‘Stock Incentive Plan’’), awards granted may be in the form of non-qualified or incentive stock
options qualifying under Section 422A of the Internal Revenue Code. Under the MetLife, Inc. 2000 Directors Stock Plan, as amended (the ‘‘Directors
Stock Plan’’), awards granted may be in the form of stock awards or non-qualified stock options or a combination of the foregoing to outside Directors of
the Company. The aggregate number of shares of stock that may be awarded under the Stock Incentive Plan is subject to a maximum limit of
37,823,333 shares for the duration of the plan. The Directors Stock Plan has a maximum limit of 500,000 share awards.
All options granted have an exercise price equal to the fair market value price of the Company’s common stock on the date of grant, and an option’s
maximum term is ten years. Certain options under the Stock Incentive Plan become exercisable over a three-year period commencing with the date of
grant, while other options become exercisable three years after the date of grant. Options issued under the Directors Stock Plan are exercisable
immediately.
The fair value of each option grant is estimated on the date of the grant using the Black-Scholes options-pricing model with the following weighted
average assumptions used for grants for the:
Years Ended December 31,
2003 2002 2001
Dividend yield*************************************************************** 0.68%-0.79% 0.68% 0.68%
Risk-free rate of return ******************************************************* 2.71%-4.03% 4.74%-5.52% 5.72%
Volatility ******************************************************************** 37.0%-38.7% 25.3%-30.3% 31.60%
Expected duration *********************************************************** 6 years 6 years 4-6 years
A summary of the status of options included in the Company’s Stock Incentive Plan and Directors Stock Plan is presented below:
Weighted Weighted
Average Options Average
Options Exercise Price Exercisable Exercise Price
Outstanding at December 31, 2000************************************* —$— —$—
Granted ************************************************************ 12,263,550 $29.93 — $ —
Exercised *********************************************************** —$— —$—
Canceled/Expired **************************************************** (1,146,866) $29.95 — $ —
Outstanding at December 31, 2001************************************* 11,116,684 $29.93 — $ —
Granted ************************************************************ 7,275,855 $30.35 — $ —
Exercised *********************************************************** (11,401) $29.95 — $ —
Canceled/Expired **************************************************** (2,121,508) $30.07 — $ —
Outstanding at December 31, 2002************************************* 16,259,630 $30.10 1,357,034 $30.01
Granted ************************************************************ 5,634,439 $26.13 — $ —
Exercised *********************************************************** (20,054) $30.02 — $ —
Canceled/Expired **************************************************** (1,578,987) $29.45 — $ —
Outstanding December 31, 2003 *************************************** 20,295,028 $29.05 4,566,265 $30.15
Years Ended December 31,
2003 2002 2001
Weighted average fair value of options granted **************************************************** $10.41 $10.48 $10.29
The following table summarizes information about stock options outstanding at December 31, 2003:
Number
Number Weighted Average Weighted Exercisable at Weighted
Outstanding at Remaining Contractual Average December 31, Average
Range of Exercise Prices December 31, 2003 Life (Years) Exercise Price 2003 Exercise Price
$23.75 – $26.75 5,180,950 9.12 $25.97 9,334 $23.75
$26.76 – $28.75 201,336 8.52 $27.41 2,336 $28.10
$28.76 – $30.75 14,707,077 7.28 $30.11 4,471,306 $30.12
$30.76 – $32.75 146,135 8.18 $31.86 58,759 $31.72
$32.76 – $33.64 59,530 9.27 $33.26 24,530 $33.64
20,295,028 7.77 $29.05 4,566,265 $30.15
MetLife, Inc. F-41