MetLife 2009 Annual Report Download - page 196

Benefit payments due under the non-qualified pension plans are funded from the Subsidiaries’ general assets as they become due under
the provision of the plans. These payments totaled $57 million and $43 million for the years ended December 31, 2009 and 2008,
respectively. These payments are expected to be at approximately the same level in 2010.
Postretirement benefits, other than those provided under qualified pension plans, are either: (i) not vested under law; (ii) a non-funded
obligation of the Subsidiaries; or (iii) both. Current regulations do not require funding for these benefits. The Subsidiaries use their general
assets, net of participant’s contributions, to pay postretirement medical claims as they come due in lieu of utilizing any plan assets. Total
payments equaled $158 million and $149 million for the years ended December 31, 2009 and 2008, respectively.
The Subsidiaries expect to make contributions of $119 million, net of participant’s contributions, towards benefit obligations (other than
those under qualified pension plans) in 2010. As noted previously, the Subsidiaries expect to receive subsidies under the Prescription Drug
Act to partially offset payment of such benefits.
Gross benefit payments for the next ten years, which reflect expected future service where appropriate, and gross subsidies to be
received under the Prescription Drug Act are expected to be as follows:
Pension
Benefits Gross
Prescription
Drug
Subsidies Net
Other Postretirement Benefits
(In millions)
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 436 $131 $(12) $119
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 413 $135 $(12) $123
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 430 $137 $(13) $124
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 441 $138 $(13) $125
2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 460 $140 $(14) $126
2015-2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,536 $733 $(77) $656
Additional Information
As previously discussed, the assets of the pension and other postretirement benefit plans are held in group annuity and life insurance
contracts issued by the Subsidiaries. Total revenue from these contracts recognized in the consolidated statements of operations was
$45 million, $42 million and $47 million for the years ended December 31, 2009, 2008 and 2007, respectively, and includes policy charges,
net investment income from investments backing the contracts and administrative fees. Total investment income (loss), including realized and
unrealized gains and losses, credited to the account balances were $725 million, ($1,090) million and $603 million for the years ended
December 31, 2009, 2008 and 2007, respectively. The terms of these contracts are consistent in all material respects with those the
Subsidiaries offer to unaffiliated parties that are similarly situated.
Savings and Investment Plans
The Subsidiaries sponsor savings and investment plans for substantially all Company employees under which a portion of employee
contributions are matched. The Subsidiaries contributed $93 million, $70 million and $76 million for the years ended December 31, 2009,
2008 and 2007, respectively.
18. Equity
Preferred Stock
In September 1999, the Holding Company adopted a stockholder rights plan (the “rights plan”). Under the rights plan, each outstanding
share of common stock issued between April 4, 2000 and the distribution date (as defined in the rights plan) is coupled with a stockholder
right. Each right will entitle the holder to purchase one one-hundredth of a share of Series A Junior Participating Preferred Stock. Each one
one-hundredth of a share of Series A Junior Participating Preferred Stock will have economic and voting terms equivalent to one share of
common stock. Until it is exercised, the right itself will not entitle the holder thereof to any rights as a stockholder, including the right to receive
dividends or to vote at stockholder meetings. Stockholder rights are not exercisable until the distribution date. The rights plan will expire at the
close of business on April 4, 2010, unless the rights are earlier redeemed or exchanged by the Holding Company. The Board of Directors of
the Holding Company does not currently intend to renew it.
The Holding Company has outstanding 24 million shares of Floating Rate Non-Cumulative Preferred Stock, Series A (the “Series A
preferred shares”) with a $0.01 par value per share, and a liquidation preference of $25 per share, for aggregate proceeds of $600 million.
The Holding Company has outstanding 60 million shares of 6.50% Non-Cumulative Preferred Stock, Series B (the “Series B preferred
shares”), with a $0.01 par value per share, and a liquidation preference of $25 per share, for aggregate proceeds of $1.5 billion.
The Series A and Series B preferred shares (the “Preferred Shares”) rank senior to the common stock with respect to dividends and
liquidation rights. Dividends on the Preferred Shares are not cumulative. Holders of the Preferred Shares will be entitled to receive dividend
payments only when, as and if declared by the Holding Company’s Board of Directors or a duly authorized committee of the board. If dividends
are declared on the Series A preferred shares, they will be payable quarterly, in arrears, at an annual rate of the greater of: (i) 1.00% above
3-month LIBOR on the related LIBOR determination date; or (ii) 4.00%. Any dividends declared on the Series B preferred shares will be
payable quarterly, in arrears, at an annual fixed rate of 6.50%. Accordingly, in the event that dividends are not declared on the Preferred
Shares for payment on any dividend payment date, then those dividends will cease to accrue and be payable. If a dividend is not declared
before the dividend payment date, the Holding Company has no obligation to pay dividends accrued for that dividend period whether or not
dividends are declared and paid in future periods. No dividends may, however, be paid or declared on the Holding Company’s common
stock — or any other securities ranking junior to the Preferred Shares — unless the full dividends for the latest completed dividend period on
all Preferred Shares, and any parity stock, have been declared and paid or provided for.
F-112 MetLife, Inc.
MetLife, Inc.
Notes to the Consolidated Financial Statements — (Continued)