MetLife 2005 Annual Report Download - page 119

METLIFE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Company as of the date of the dividend without prior regulatory approval, and an additional $873 million in special dividends, as approved by the
Delaware Superintendent. On October 8, 2004, Metropolitan Insurance and Annuity Company (‘‘MIAC’’) was merged into MTL. Prior to the merger, MIAC
paid the Holding Company $65 million in dividends for which prior insurance regulatory clearance was not required and paid no special dividends for the
year ended December 31, 2004. For the year ended December 31, 2003, MIAC paid to the Holding Company $104 million in dividends for which prior
insurance regulatory clearance was not required and $94 million in special dividends. MTL, exclusive of MIAC, paid no dividends to the Holding Company
during the years ended December 31, 2004 and 2003. The maximum amount of dividends that may be paid to the Holding Company from MTL in 2006,
without prior regulatory approval, is $85 million, for dividends with a scheduled date of payment subsequent to May 25, 2006.
Stock Compensation Plans
The MetLife, Inc. 2000 Stock Incentive Plan, as amended (the ‘‘Stock Incentive Plan’’), authorized the granting of awards in the form of non-qualified
or incentive stock options qualifying under Section 422A of the Internal Revenue Code. The MetLife, Inc. 2000 Directors Stock Plan, as amended (the
‘‘Directors Stock Plan’’), authorized the granting of awards in the form of stock awards, non-qualified stock options, or a combination of the foregoing to
outside Directors of the Holding Company. Under the MetLife, Inc. 2005 Stock and Incentive Compensation Plan, as amended (the ‘‘2005 Stock Plan’’),
awards granted may be in the form of non-qualified stock options or incentive stock options qualifying under Section 422A of the Internal Revenue Code,
Stock Appreciation Rights, Restricted Stock or Restricted Stock Units, Performance Shares or Performance Share Units, Cash-Based Awards, and
Stock-Based Awards (each as defined in the 2005 Stock Plan). Under the MetLife, Inc. 2005 Non-Management Director Stock Compensation Plan (the
‘‘2005 Directors Stock Plan’’), awards granted may be in the form of non-qualified stock options, Stock Appreciation Rights, Restricted Stock or
Restricted Stock Units, or Stock-Based Awards (each as defined in the 2005 Directors Stock Plan). The Stock Incentive Plan, Directors Stock Plan, 2005
Stock Plan, the 2005 Directors Stock Plan and the Long-Term Performance Compensation Plan (‘‘LTPCP’’), as described below, are hereinafter
collectively referred to as the ‘‘Incentive Plans.’’
The aggregate number of shares reserved for issuance under the 2005 Stock Plan is 68,000,000 plus those shares available but not utilized under
the Stock Incentive Plan and those shares utilized under the Stock Incentive Plan that are recovered due to forfeiture of stock options. At the
commencement of the 2005 Stock Plan, additional shares carried forward from the Stock Incentive Plan and available for issuance under the 2005 Stock
Plan were 11,917,472. Each share issued under the 2005 Stock Plan in connection with a stock option or Stock Appreciation Right reduces the number
of shares remaining for issuance under that plan by one, and each share issued under the 2005 Stock Plan in connection with awards other than stock
options or Stock Appreciation Rights reduces the number of shares remaining for issuance under that plan by 1.179 shares. The number of shares
reserved for issuance under the 2005 Directors Stock Plan is 2,000,000.
All stock options granted have an exercise price equal to the fair market value price of the Holding Company’s common stock on the date of grant,
and a maximum term of ten years. Certain stock options granted under the Stock Incentive Plan and the 2005 Stock Plan become exercisable over a
three year period commencing with the date of grant, while other stock options become exercisable three years after the date of grant. Stock options
issued under the Directors Stock Plan are exercisable immediately. Exercise dates for stock options issued under the 2005 Directors Stock Plan will be
determined at the time they are granted.
A summary of the status of stock options issued pursuant to the Incentive Plans is presented below:
Weighted Weighted
Average Options Average
Options Exercise Price Exercisable Exercise Price
Outstanding at January 1, 2003 *************************************** 16,259,630 $30.10 1,357,034 $30.01
Granted *********************************************************** 5,634,439 $26.13 — $ —
Exercised ********************************************************** (20,054) $30.02 — $ —
Cancelled/Expired*************************************************** (1,578,987) $29.45 — $ —
Outstanding at December 31, 2003 *********************************** 20,295,028 $29.05 4,566,265 $30.15
Granted *********************************************************** 5,074,206 $35.28 — $ —
Exercised ********************************************************** (1,464,865) $29.70 — $ —
Cancelled/Expired*************************************************** (642,268) $30.27 — $ —
Outstanding at December 31, 2004 *********************************** 23,262,101 $30.33 12,736,500 $29.57
Granted *********************************************************** 4,318,325 $38.70 — $ —
Exercised ********************************************************** (2,464,190) $29.68 — $ —
Cancelled/Expired*************************************************** (734,453) $32.26 — $ —
Outstanding at December 31, 2005 *********************************** 24,381,783 $31.83 15,375,005 $29.85
The following table summarizes additional information about stock options outstanding at December 31, 2005:
Weighted
Number Average Weighted Number Weighted
Outstanding at Remaining Average Exercisable at Average
December 31, Contractual Exercise December 31, Exercise
Range of Exercise Prices 2005 Life (Years) Price 2005 Price
$26.00 — $31.23********************************************** 15,515,008 5.93 $28.94 13,850,856 $29.26
$31.24 — $37.33********************************************** 4,629,250 8.12 $35.22 1,512,148 $35.19
$37.34 — $43.43********************************************** 4,140,325 9.23 $38.41 12,001 $38.00
$43.44 — $49.53********************************************** 87,100 9.63 $48.15 — $ —
$49.54 — $50.38********************************************** 10,100 9.87 $50.35 — $ —
24,381,783 15,375,005 $29.85
MetLife, Inc. F-57