Compensation Committee Report
Compensation Committee Report
This report is furnished by the Compensation Committee of the MetLife, Inc. (
MetLife
or the
Company
) Board of Directors. The Compensation Committee has
reviewed and discussed with management the Compensation Discussion and Analysis that is set forth on pages 41 through 71 of the Company’s 2017 Proxy Statement and, based on such review and discussion, the Compensation Committee recommended to
the Board of Directors that such Compensation Discussion and Analysis be included in the 2017 Proxy Statement.
No portion of this Compensation Committee Report
shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the
Securities Act
), or the Securities Exchange Act of 1934, as amended (the
Exchange Act
), through any general statement
incorporating by reference in its entirety the proxy statement in which this Report appears, except to the extent that the Company specifically incorporates this report or a portion of it by reference. In addition, this report shall not be deemed to
be “soliciting material” or to be “filed” under either the Securities Act or the Exchange Act.
Respectfully,
James M. Kilts, Chair
Cheryl W. Grisé
Edward J. Kelly, III
Denise M. Morrison
Kenton J. Sicchitano
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2017 Proxy Statement
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40
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Compensation Discussion and Analysis
Compensation Discussion and Analysis
The Compensation Discussion and Analysis describes the objectives and policies underlying MetLife’s executive compensation program for the Named
Executive Officers and the rest of the Executive Group. It also describes the key factors that the Compensation Committee (in this discussion, also referred to as the
Committee
) considered in determining the compensation of the members of the
Executive Group.
Key Highlights
MetLife:
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✓
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launched
new enterprise strategy and brand
with significant progress on transformation to a
simpler company
with less market sensitivity and
higher, sustainable Free Cash Flow
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✓
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generated
Free Cash Flow
(as adjusted) that
continued to increase
(77% in 2016 vs. 26% in 2012) and exceeded the mid-point of the Business Plan
range.
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✓
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announced the
largest share repurchase program
in MetLife’s history at $3 billion.
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✓
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sold its U.S. retail advisor force,
generating expected cost savings
while reducing regulatory risk.
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✓
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prevailed in U.S. District Court litigation to
rescind systemically important financial institution (SIFI) designation
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✓
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experienced below target 2016 Operating Earnings, driven by lower underwriting, reserve updates, and the anticipated
Separation of Brighthouse Financial
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MetLife’s Compensation Committee:
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✓
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approved a
CEO annual incentive award for 2016
down $500,000 (decrease of 11%)
from 2015.
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✓
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approved a
lower annual incentive award
for 2016 than for 2015 for 3 of the 4 other Named Executive Officers.
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✓
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approved 2014-2016 Performance Shares distribution at
44.4% of target
, a below target payout resulting largely from Total Shareholder Return relative to peers.
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MetLife’s compensation programs:
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provide the largest portion of executives’ Total Compensation in
variable, performance-dependent awards
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✓
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align executives with shareholders
through Share-based awards and Share ownership requirements.
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✓
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incorporate risk management
through appropriate financial metrics, non-formulaic performance assessment, and Chief Risk Officer program review.
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2017 Proxy Statement
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41
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Compensation Discussion and Analysis
Table of Contents
for the Compensation Discussion and Analysis
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2017 Proxy Statement
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42
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Compensation Discussion and Analysis
Highlights of 2016 Business Results
In 2016, under the leadership of Chief Executive Officer Steven A. Kandarian, the Company continued to execute its 2012 enterprise strategy of reducing risks by
refocusing the U.S. business, growing in emerging markets, extending the reach of MetLife’s market-leading group benefits business beyond the U.S., and embracing customer-centricity and a global brand.
At the same time, MetLife embarked upon an ambitious business transformation in 2016, informed by the Accelerating Value initiative. This initiative ensures a
consistent capital allocation approach across the enterprise, and now covers 98% of MetLife’s allocated capital for new business. For example, through this initiative MetLife has:
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improved the risk return profile of the Retirement and Income Solutions business;
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shifted focus to grow our non-Yen denominated and accident and health businesses in Japan while dramatically reducing the interest-rate sensitive Yen whole life business;
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begun to extend its accident and health presence from the public to the private sector in Mexico; and
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continued to optimize its investment portfolio asset mix.
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MetLife’s most important Accelerating Value decision to
date has been to separate a substantial portion of its former U.S.
Retail business, now known as Brighthouse Financial. The Company’s Accelerating Value work also led to MetLife’s refreshed enterprise strategy and portfolio approach to managing five
clusters of businesses, and to a commitment to invest $1 billion by 2020 to generate $800 million in pre-tax annual run rate savings, net of stranded overhead costs primarily due to the anticipated Separation
. See pages 2-4 for a description
of these initiatives.
MetLife also launched a new brand in 2016 to reflect the trusted partnership the Company’s customers want from MetLife. MetLife’s
new logo, the partnership M, and its new tagline, “navigating life together,” embody this commitment.
All of the Company’s major decisions are
informed by the need to generate Free Cash Flow and return capital to shareholders. To that end, MetLife’s Board of Directors authorized a $3 billion share repurchase program in 2016, and management began implementing the program during the
year. The Company also announced its intention to keep MetLife’s common stock dividend constant after a Separation even though it will be shedding approximately 20% of its Operating Earnings capacity.
The Compensation Committee’s decisions on the active Named Executive Officers’ compensation for 2016 reflected its view of the Company’s performance and
each executive’s performance relative to his goals and other challenges and opportunities that arose in 2016.
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2017 Proxy Statement
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43
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Compensation Discussion and Analysis
In 2016, under the leadership of Mr. Kandarian and the Executive Group, the Company achieved the results shown on
pages 45-46 compared to its Business Plan, as reviewed by the Compensation Committee and Board. The Company’s 2015 results and 2015 Business Plan are included for reference.
The 2016 Business Plan anticipated a decline in Operating Earnings, flat Operating ROE, and a slight increase in Operating Earnings Per Share from the 2015 Business
Plan.
The Board determined that the Business Plan was appropriate in light of several macroeconomic factors, including:
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strengthening of the U.S. dollar on consensus foreign currency exchange rates;
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continued low long-term interest rates; and
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narrowing of the spread between short-term and long-term interest rates within consensus interest rates.
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The 2016 Business Plan also included planned expense reductions and higher Share repurchases that increased Operating
Earnings Per Share and Operating ROE Business Plan targets, partially mitigating the anticipated Operating Earnings decline.
Two events negatively impacted the
Company’s results in 2016. Second quarter reserve charges, influenced in part by the anticipated Separation, negatively impacted Net Income and Operating Earnings. The fourth quarter derivatives loss negatively impacted Net Income, primarily
driven by significantly higher interest rates; the Company uses derivatives almost exclusively to protect against market fluctuations in interest rates, equities, and currencies.
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2017 Proxy Statement
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44
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Compensation Discussion and Analysis
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1
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The 2016 results of Operating Earnings, Operating EPS and Operating ROE have been adjusted to reflect the results reviewed by the Compensation Committee and Board for incentive compensation purposes. The adjustments
excluded certain non-cash charges totaling $469 million, net of income tax, and Separation costs of $232 million, net of income tax. See “Annual Incentive Awards” beginning on page 58, and the discussion of “Performance
Shares” beginning on page 61, for further information on these items. Unadjusted, these amounts would be $5,089 million, $4.59 and 8.9%, respectively.
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The Compensation Committee and Board used the same 2016 Business Plan goals in its assessment of the Chief Executive Officer’s 2016 performance. For
that purpose, 2016 results for Operating Earnings, Operating EPS and Operating ROE were adjusted for
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2017 Proxy Statement
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45
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Compensation Discussion and Analysis
total Notable Items and foreign currency translation. These adjustments produced results of $6,041 million, $5.45, and 10.5%, respectively. For other key aspects of Mr. Kandarian’s
performance, see “Aspects of Individual Performance” beginning on page 48.
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The 2016 Operating Expense Ratio has been adjusted to exclude a Notable Item of $44 million related to the Company’s unit cost initiative expenses. Unadjusted, the Operating Expense Ratio would be 22.4%.
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3
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The 2016 Free Cash Flow as a Percentage of Operating Earnings has been adjusted to exclude $2.3 billion, net of income tax, of Separation-related items, which reduced holding companies’ liquid assets as well as
MetLife Free Cash Flow. These Separation-related items consisted of Separation-related outflows comprised of an incremental capital contribution to Brighthouse Insurance, capital contributions to intended Brighthouse Financial subsidiaries and
Separation-related costs, forgone subsidiary dividends from Brighthouse Insurance and forgone incremental debt at MetLife, net of Separation-related inflows comprised of incremental subsidiary dividends from New England Life Insurance Company and
Brighthouse Insurance. In addition, the 2016 Free Cash Flow as a Percentage of Operating Earnings also excludes total Notable Items, primarily related to the actuarial assumption review and other insurance adjustments, of $1.0 billion, net of income
tax, and Separation-related costs of $15 million, net of income tax, both of which negatively impacted Operating Earnings. Unadjusted, the Free Cash Flow as a Percentage of Operating Earnings would be 48%. The 2016 Free Cash Flow as a Percentage of
Operating Earnings was adjusted to exclude total Notable Items and items related to the Separation since these items were not anticipated at the time the 2016 Business Plan was approved.
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4
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The 2015 results of Operating Earnings, Operating EPS, Operating ROE, Operating Expense Ratio, Book Value Per Share and Free Cash Flow as a Percentage of Operating Earnings have been adjusted to exclude a non-cash
charge of $792 million, net of income tax, related to an uncertain tax position comprised of a $557 million charge included in provision for income tax expense and a $362 million charge ($235 million net of income tax) included in other expenses.
This non-cash charge is related to tax years 2000 to 2009 for a wholly-owned U.K. subsidiary of MLIC, as disclosed by the Company on Form 8-K on September 16, 2015. The charge was the result of the Company’s consideration of court decisions
upholding the U.S. Internal Revenue Service’s disallowance of foreign tax credits claimed by corporate entities not affiliated with the Company. Resolution of the Company’s own foreign tax credits awaits filing of (and determinations
regarding) refund claims. Unadjusted, these amounts would be $5,484 million, $4.86, 9.7%, 24.1%, $51.15 and 73%, respectively.
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5
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The percentages presented for the Business Plans are the mid-point of the Business Plans’ respective ranges.
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The
performance measures above are not calculated based on GAAP. They should be read in conjunction with the information in “Non-GAAP and Other Financial Disclosures” in Appendix B of this Proxy Statement, which includes non-GAAP financial
information, definitions and/or reconciliations to the most directly comparable measures that are based on GAAP.
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2017 Proxy Statement
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46
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Compensation Discussion and Analysis
Highlights of Executive Performance and Compensation
MetLife maintained its commitment to its pay for performance philosophy for 2016. The Compensation Committee’s decisions on the active Named
Executive Officers’ compensation reflected the Committee’s view of the Company’s overall strategic direction and financial performance, and each executive’s performance relative to his goals and other challenges and opportunities
that arose in 2016. The Named
Executive
Officers in this Proxy Statement are:
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Chairman of the Board, President and Chief Executive Officer Steven A. Kandarian;
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Executive Vice President and Chief Financial Officer John C. R. Hele;
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Executive Vice President, Global Technology & Operations Martin J. Lippert;
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Executive Vice President and Chief Investment Officer Steven J. Goulart; and
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President, Asia Christopher G. Townsend.
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Under the leadership of Mr. Kandarian and his Executive Group, the Company delivered on multiple important goals relating
to the strategic transformation underway at MetLife. However, the Company did not meet all of its annual financial objectives. The anticipated Separation is the most significant strategic initiative the Company has undertaken since the acquisition
of Alico more than six years ago. The Company’s 2016 shortfall relative to its Operating Earnings target was influenced by steps taken to effect the Separation, which the Company believes is essential to creating long-term shareholder value.
The Committee approved an Annual Variable Incentive Plan (
AVIP
) Performance Funding Level of 87% of target as described on page A-2. The aspects of
individual performance the Committee considered in making individual incentive decisions are discussed below. The Committee also approved a performance factor of 44.4% for the 2014 - 2016 Performance Shares and Performance Units that vested at the
end of 2016. This below target payout resulted largely from Total Shareholder Return relative to the Company’s peers, a measure which demonstrates continued alignment with shareholders. The Company’s performance for 2016 reflects multiple
strategic actions that impacted financial performance in the short-term. The Committee is confident that the bold decisions in 2016 provide a solid foundation for value creation and superior shareholder returns in the future.
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2017 Proxy Statement
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47
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Compensation Discussion and Analysis
Aspects of Individual Performance
The Compensation Committee determined the Executive Group members’ 2016 AVIP awards and stock-based long-term incentive awards by considering the Company’s key
financial performance goals and results as discussed in “Highlights of 2016 Business Results” beginning on page 43. The Compensation Committee also considered aspects of each executive’s performance in relation to the
executive’s and the Company’s strategic goals.
Steven A. Kandarian, Chairman of the Board, President and Chief
Executive Officer
2016 was one of the most transformative years in the history of MetLife. Mr. Kandarian is leading strategic changes to
forge a clear path to the enterprise MetLife intends to become: a simpler company with less market sensitivity and higher, sustainable Free Cash Flow.
In early
2016, the Company announced its intention to separate a substantial portion of its U.S. retail business. In 2016, the Company took risk-management actions to safeguard its ability to execute the anticipated Separation regardless of the asymmetrical
and non-economic accounting losses the interest rate environment generated. These accounting losses were the result of actions necessary to ensure MetLife’s transformation into a company with higher, sustained Free Cash Flow generation.
The Company believes Free Cash Flow is the most important metric to driving shareholder value over time. Each dollar of Free Cash Flow is available for dividends, Share
repurchases, and acquisitions. In terms of Free Cash flow, 2016 was a strong year. The Company’s ratio of Free Cash Flow to Operating Earnings in 2016 was 77% (after adjusting for Notable Items and excluding the impact of related items and
costs associated with the anticipated Separation), up from 63% in 2015 (after adjusting for a non-cash charge related to uncertain tax positions) and well above the mid-point of the Business Plan range of 55-65%. In 2012, Mr. Kandarian’s first
full year as CEO, the Free Cash Flow ratio was only 26%.
2016 Key Achievements include:
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Introduced refreshed enterprise strategy
to transform MetLife into a company where capital allocation decisions
drive lower market sensitivity, higher
internal rates of return, shorter payback periods, and higher, sustainable Free Cash Flow.
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Announced
the largest share repurchase program in
Company
history at $3 billion.
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Initiated an ambitious expense management program which has already moved higher so the Company can
deliver $800 million in pre-tax annual run-rate savings to the bottom line by 2020
,
net of stranded overhead costs.
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Succeeded in U.S. District Court litigation to rescind MetLife’s designation as a systemically important financial institution (SIFI)
; as of the date of this Proxy Statement, the
Company awaited a decision on the government’s appeal.
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Sold the U.S. retail advisor force,
the MetLife Premier Client Group, to MassMutual to generate
significant
savings and
substantially reduce the Company’s potential regulatory risk
from current or future efforts to impose fiduciary liability in the sale of financial products to consumers.
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Launched a refreshed brand
that positions MetLife as a trusted partner to our business and consumer clients across the globe.
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Earned Company recognition in the Dow Jones Sustainability Index
— North America, which recognizes the top 20% of sustainability performers across large U.S. and Canadian
companies, and also in
Newsweek magazine’s 2016 Green Rankings
, which named MetLife the number 1 insurance company in the world and the number 1 financial services company in the U.S. for
environmental performance.
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Earned Company recognition for its commitment to gender equality
, appearing on Bloomberg’s inaugural “Financial Services Gender-Equality Index” and being named one of
the “Top 50 Companies for Executive Women” by the U.S. National Association for Female Executives (NAFE).
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2017 Proxy Statement
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48
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Compensation Discussion and Analysis
Compensation:
The Committee reviewed Mr. Kandarian’s achievements as well as market data and approved an AVIP award for 2016 that was
down 11% from last year (decrease of $500,000)
, reflecting the Company’s financial performance. This is the second year of declining AVIP awards aligned
with short-term Company performance; Mr. Kandarian’s award for 2015 performance was also $500,000 less than for 2014, making his 2016 award $1,000,000 less than for 2014. His stock-based long-term incentive award value for 2016 was the same as
it was for 2015, reflecting progress toward long-term strategic objectives. The Committee approved no base salary increase for Mr. Kandarian for 2017.
The
Committee believes Mr. Kandarian’s total compensation appropriately reflects the Company’s performance at this point in the Company’s transformation which is laying the foundation for significant improvement in future financial
performance.
John C.R. Hele, Executive Vice President and Chief Financial Officer
2016 Key Achievements:
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Maintained key capital adequacy ratios
above minimum targets based on current regulations,
exceeded
Free Cash
Flow
goals
(adjusted as described on page 45), and
achieved Operating Expense Ratio
within Business Plan Range. Mr. Hele
enhanced the
capital budgeting process
to give priority to businesses with high risk-adjusted internal
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rates of return, lower capital intensity, and maximum cash generation.
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Created the Separation Management Office to oversee the
Separation of Brighthouse Financial
. He co-lead the Company’s
Accelerating Value strategy
initiative
, leading a work stream to
focus on businesses with high risk-adjusted internal rates of return, lower capital intensity and maximum cash generation.
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Established a Unit Cost Office and
created an enterprise expense savings plan to drive savings through 2020.
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Drove the Company’s largest-ever share repurchase program at $3 billion.
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Recognized as
Institutional Investor Magazine’s 2017 Top Chief Financial Officer
for buy-side for the third year in a row. Investor Relations team was recognized as 2017’s
Number 1 for the Best Analyst Days
and 2nd Best Insurance Investor Relations Program overall.
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Compensation:
Mr. Kandarian recommended, and the Committee approved, an AVIP
award for 2016 that was
down 9% from last year
(
decrease of
$200,000)
to reflect the Company’s financial performance. Mr. Hele’s
stock-based long-term incentive award for 2016 is the same as for last year, reflecting progress toward long-term strategic objectives.
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2017 Proxy Statement
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49
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Compensation Discussion and Analysis
Martin J. Lippert, Executive Vice President, Global Technology & Operations
2016 Key Achievements:
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Exceeded goals across all cost savings initiatives
through prudent expense management by consolidating operations and real estate around the world, streamlining processes, and
re-negotiating information technology vendor contracts.
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Drove MetLife’s enterprise digital strategy across all regions for
consistent digital standards across marketing, sales, and service. Launched the industry’s first fully Digital
end-to-end platform
for U.S. Auto and
configurable sales platform
for the Japan business.
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Achieved top quartile performance
for U.S. call centers’ Customer Satisfaction and Net Promoter Score metrics based on third-party benchmarks. MetLife’s Corporate Benefit
Funding Customer Solutions Center team was
recognized by J.D. Power for Outstanding Customer Service
following third-party audit of 100+ customer practices.
Completed the consolidation of
over 93 data facilities
into 3 regional data centers to improve MetLife’s underlying risk profile.
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Delivered new capabilities on the MetLife Investment Management platform to
support over 70 institutional clients
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Compensation:
Mr. Kandarian recommended, and the Committee approved, an AVIP award for 2016 that was
down 9% from last year
(decrease of $200,000)
to reflect the Company’s financial performance. Mr. Lippert’s stock-based long-term incentive award value for 2016 was higher than it was for 2015, reflecting
significant progress advancing the Company’s global digital strategy, which provides the foundation for the Company’s strategy refresh.
Steven J. Goulart, Executive Vice President and Chief Investment Officer
2016 Key Achievements:
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Achieved 2016 Plan Net Investment Income
,
implementing initiatives to counter low interest rates
and lower variable investment income; remained on
schedule to
reduce hedge fund investments
; and
took thoughtful credit actions to reduce risk
in MetLife’s portfolio.
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Continued growth in MetLife Investment Management (MIM) assets under management and pre-tax profit;
completed Accelerating Value analysis
for MIM,
showing
attractive Value of New Business and Internal Rates of Return
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Implemented regional
portfolio optimizations
to reduce regulatory capital use as well as
improve cash flow
and Net Investment Income.
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Enhanced the Company’s
corporate social responsibility report
(“Global Impact”) outlining a vigorous risk management discipline to address Environmental, Social and
Governance (ESG) risks and opportunities for investments that provide social and/or environmental benefits along with economic returns.
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Compensation:
Mr. Kandarian recommended, and the Committee approved, an
AVIP award for 2016 that was
up 7% from last year (increase of $100,000)
. This reflected a promotion to recognize the criticality of Mr. Goulart’s role in leading the Company’s Investments organization and the growth in the
MIM
business. Mr. Goulart’s stock-based long-term incentive award value for 2016 was the same as it was for 2015, reflecting progress toward long-term strategic objectives.
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2017 Proxy Statement
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50
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Compensation Discussion and Analysis
Christopher G. Townsend, President, Asia
2016 Key Achievements
:
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Led the Asia region to deliver
Operating Earnings of $1.2 billion
, down 10% as reported (down five percent excluding Notable Items, on a constant currency basis) versus 2015.
Tangible ROE for Asia was 19.4% in 2016
, compared to 20.6% in 2015. These results reflect trade-offs under the enterprise strategy, as sales of lower-value products are slowed to focus on higher-value products.
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Continued to lead the
shift of products in Japan from interest rate sensitive products to higher margin foreign currency denominated life products, sales of which increased 48%
over
the prior year. Those changes, coupled with similar actions in other markets such as improving product mix in Korea, are integral to the new strategy.
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Continued to
expand MetLife’s capabilities in health, digital, data analytics, and innovation
to drive differentiation and enhance long-term competitiveness in Asia.
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Compensation
:
Mr. Kandarian recommended, and the Committee approved, an AVIP award for 2016 that was
down 9% from last
year
(decrease of $100,000)
to reflect the Company’s financial performance. Mr. Townsend’s
stock-based long-term incentive award value for 2016 was the same as it was for 2015, reflecting progress towards long-term strategic objectives.
The amounts in the chart above, and in the charts for the other NEOs in this section entitled “Aspects of Individual
Performance” reflect the base salary earned in 2016 as reported in the Summary Compensation Table on page 72 and the incentive compensation award amounts reported for performance year 2016 in the Compensation Committee Incentive Decisions table
on page 52.
Some of the performance measures in this section entitled “Aspects of Individual Performance” are not calculated based on GAAP. They should
be read in conjunction with the information in “Non-GAAP and Other Financial Disclosures” in Appendix B of this Proxy Statement, which includes non-GAAP financial information, definitions and/or reconciliations to the most directly
comparable measures that are based on GAAP.
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2017 Proxy Statement
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51
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Compensation Discussion and Analysis
Incentive Compensation Decisions for 2016 Performance
The following table reflects the incentive compensation decisions (AVIP and stock-based long-term incentive (
LTI
) awards) the Compensation Committee approved for
each NEO in February 2017 based on 2016 performance. For additional detail on the specific performance criteria used to determine these awards, see pages 48-51 and 58-60 for AVIP and 48-51 and 61-64 for LTI.
AVIP awards for all but one NEO were lower than last year, in alignment with 2016 Company performance. The exception was Mr. Goulart, whose AVIP award was seven percent
higher to reflect a promotion to recognize the criticality of his role leading the Company’s Investments organization and the growth in the MetLife Investment Management business. LTI awards for all but one NEO were flat to last year to reflect
sustained progress toward long-term shareholder value creation. The exception was Mr. Lippert whose LTI award value was seven percent higher than last year. This reflected strong progress across Mr. Lippert’s areas of responsibility, including
cost savings initiatives, driving customer centricity, and advancing the Company’s global digital strategy, which is core to the strategy refresh.
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Compensation Committee Performance-Year Incentive Decisions
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2016
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2016 versus 2015(3)
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|
Name
|
|
|
|
|
|
|
|
AVIP Award(1)
|
|
|
|
|
|
|
|
|
LTI(2)
|
|
|
|
|
|
|
|
|
AVIP Award
|
|
|
|
|
|
|
|
LTI
|
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|
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|
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|
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|
|
Steven A. Kandarian
|
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|
|
|
|
|
|
|
|
$4,000,000
|
|
|
|
|
|
|
|
|
|
|
|
$10,500,000
|
|
|
|
|
|
|
|
|
|
|
(11)%
|
|
|
|
|
|
|
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
John C.R.
Hele
|
|
|
|
|
|
|
|
|
|
|
$2,000,000
|
|
|
|
|
|
|
|
|
|
|
|
$3,000,000
|
|
|
|
|
|
|
|
|
|
|
(9)%
|
|
|
|
|
|
|
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
|
|
|
|
|
$2,100,000
|
|
|
|
|
|
|
|
|
|
|
|
$3,000,000
|
|
|
|
|
|
|
|
|
|
|
(9)%
|
|
|
|
|
|
|
|
|
|
|
7
|
%
|
|
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
|
|
|
|
|
$1,500,000
|
|
|
|
|
|
|
|
|
|
|
|
$2,500,000
|
|
|
|
|
|
|
|
|
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
|
|
|
|
|
$1,000,000
|
|
|
|
|
|
|
|
|
|
|
|
$1,800,000
|
|
|
|
|
|
|
|
|
|
|
(9)%
|
|
|
|
|
|
|
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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1
|
Reflects the 2016 AVIP award paid in 2017. Each is as reported in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table on page 72, except that the award to Mr. Townsend reported in the
Summary Compensation Table differs because it reflects local currency conversion rate.
|
|
2
|
Reflects the 2017 LTI award value, not the grant date fair value calculated in accordance with the applicable accounting standard, ASC 718. The grant date fair values will be disclosed for Named Executive Officers
reported in the Grants of Plan-Based Awards Table in the Company’s 2018 Proxy Statement. This table is not a substitute for the Summary Compensation Table on page 72, but provides a holistic view of incentive compensation decisions for
performance year 2016.
|
|
3
|
Reflects AVIP Award and LTI as described in notes 1 and 2 compared to amounts for 2015 determined in the same manner.
|
In addition to each executive’s accomplishments against individual goals for the year, all compensation decisions were made within the context of MetLife’s
executive compensation programs and framework and internal equity considerations, as well as alignment and appropriate competitive positioning against external market peers. LTI awards reflect individual performance as well as expectations of
contributions to future performance.
Additional details on individual performance and 2016 incentive decisions are provided under “Aspects of Individual
Performance” on page 48.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
52
|
Compensation Discussion and Analysis
Most of the Total Compensation for 2016 performance for the CEO, and the other Named Executive Officers, was variable and
depended on performance. In addition, the Committee allocated a greater portion of the Named Executive Officers’ variable compensation to stock-based LTI than to cash AVIP. These long-term incentives align executive and shareholder interests
and encourage future contributions to performance. Ultimately, the value of LTI depends on future Company performance, including stock price performance.
The
Company’s LTI awards are comprised of Performance Shares, Restricted Stock Units, Stock Options, and, in some cases with respect to Executive Group members outside the United States, cash payable equivalents. MetLife determines the number of
Performance Shares and Restricted Stock Units (and cash payable equivalents) in each award by dividing that portion of the LTI award value by the Share closing price on the grant date. If the Share closing price on the grant date is outside a 15%
range (higher or lower) of the average Share closing price for the year to date, MetLife uses that average closing price instead of the
closing price on the grant date. The number of Stock Options (and cash-payable equivalents) in the award is determined by dividing that portion of the LTI award value by one-third of the Share
closing price on the grant date. The exercise price of Stock Options is the closing price on the grant date.
The Company’s long-term performance, including
changes in the price of Shares, has a significant impact on the Named Executive Officers’ compensation. In early 2016, the Board of Directors approved payouts for Performance Share and Performance Unit awards for 2013-2015 that reflected a
performance factor of 86.2%. The payout for Performance Share and Performance Unit awards for 2014-2016 reflected a performance factor of 44.4%, below target due primarily to Total Shareholder Return (
TSR
) performance relative to the
Company’s global peer group. The Committee believes that the realized value of these awards — along with Share ownership requirements — appropriately aligns management with Company performance as well as shareholder interests
over time.
CEO Value Realized From Performance Shares Vested
in 2016
The table below illustrates that Company performance below target resulted in the CEO realizing 54% (almost $2.4 million) less than the LTI award value
at grant from the 2014-2016 Performance Share award, resulting from below threshold TSR performance combined with modest increases in Share price.
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|
|
|
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|
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|
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|
|
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|
|
|
|
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|
|
|
|
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|
|
|
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|
|
|
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|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014-2016 Performance Shares (Granted February 25, 2014)
|
|
|
|
|
|
Target Award
Value at Grant(1)
|
|
|
|
|
|
Company Performance
|
|
|
|
|
|
Realized Value
at Distribution
|
|
|
|
|
|
Change in Value
from Target to Realized
|
|
|
|
|
|
|
|
|
|
Operating ROE
Goal
(Versus Business Plan)
|
|
|
|
|
|
TSR Goal
(Relative to Peers)
|
|
|
|
|
|
Performance
Factor(2)
|
|
|
|
|
|
Share Price
Appreciation(3)
|
|
|
|
|
|
|
|
|
|
|
($)
|
|
|
|
|
|
(%)
|
|
|
|
|
|
$4,396,110
|
|
|
|
|
|
97%
|
|
|
|
|
|
<25th percentible
|
|
|
|
|
|
44.4%
(average of components)
|
|
|
|
|
|
3.8%
|
|
|
|
|
|
$2,025,652
|
|
|
|
|
|
$(2,370,458)
|
|
|
|
|
|
(54)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance Factor Components
|
|
|
|
|
|
88.8%
|
|
|
|
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Reflects the LTI award value using target performance, not the grant date fair value calculated in accordance with the applicable accounting standard, ASC 718. The grant date fair value was disclosed in the Grants of
Plan-Based Awards Table in the Company’s 2015 Proxy Statement.
|
|
2
|
See “Performance Shares” on pages 61-64 for how the performance factor is tied to Company performance.
|
|
3
|
Reflects change in Share price from grant on February 25, 2014 to distribution at February 28, 2017.
|
The CEO’s 2015 and later Performance Share awards continue to vest, subject to the same performance metrics. In addition, the CEO exceeds his Share
ownership requirement of 7 times his annual base salary rate, further ensuring shareholder alignment.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
53
|
Compensation Discussion and Analysis
Compensation Philosophy and Objectives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provide competitive Total Compensation opportunities to attract, retain, engage, and motivate high-performing executives
|
|
|
|
|
|
|
|
|
|
|
|
Align compensation plans with short- and long-term business strategies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Align the financial interests of executives with shareholders’ through stock-based incentives and Share ownership
requirements
|
|
|
|
|
|
|
|
|
|
|
|
Make a significant portion of Total Compensation variable and subject to Company and individual performance.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Key Features of MetLife’s Executive Compensation Program
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MetLife’s compensation program has multiple features
that promote the Company’s success, including:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
paying for performance
:
most compensation is variable without guarantee, and dependent on achievement of business
results.
|
|
|
|
|
|
|
|
aligning executives’ interests with those of shareholders
:
most incentive compensation is
stock-based, and executives are expected to meet Share ownership requirements.
|
|
|
|
|
|
|
|
encouraging long-term decision-making
:
Stock Options and Restricted Stock Units vest over three
years, Stock Options may normally be exercised over 10 years, and the ultimate value of Performance Shares is determined by the Company’s performance over three years.
|
|
|
|
|
|
|
|
rewarding achievement of the Company’s business goals
:
amounts available for annual incentive
awards are based on Company performance compared to its Business Plan; individual awards take account of individual performance relative to individual goals.
|
|
|
|
|
|
|
|
avoiding incentives to take excessive risk
:
the Company does not make formulaic awards as part of
its normal program, uses Operating Earnings (which excludes net investment gains and losses and net derivative gains and losses) as a key performance indicator, and uses multi-year performance to determine the ultimate value of stock-based
awards.
|
|
|
|
|
|
|
|
maintaining a performance-based compensation recoupment (clawback) policy
:
the Company may seek
recovery for employee fraudulent or other wrongful conduct that harmed MetLife.
|
|
|
|
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|
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|
|
The
Company’s compensation program excludes practices
that would be contrary to the Company’s
compensation
philosophy and contrary to shareholders’ interests.
For example, the Company:
|
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|
|
|
|
|
|
|
|
|
does not
offer Executive Group members a supplemental executive retirement plan that provides benefits under a
different formula than the generally-applicable pension plan, or that adds to years of service or includes long-term incentive compensation in the benefits formula.
|
|
|
|
|
|
|
|
does not
provide excessive perquisites.
|
|
|
|
|
|
|
|
does not
allow repricing or replacing of Stock Options without prior shareholder approval.
|
|
|
|
|
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|
|
does not
provide any “single trigger” change-in-control severance pay, or “single
trigger” vesting of stock-based awards upon a change-in-control without the opportunity for the Company or a successor to substitute alternative awards that remain subject to vesting.
|
|
|
|
|
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|
|
does not
provide any change-in-control severance pay beyond two times average pay.
|
|
|
|
|
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|
|
does not
provide for any excise tax payment or tax gross-up for change-in-control related
payments, or for tax gross-up for any perquisites or benefits, other than in connection with relocation or other transitionary arrangements when an Executive Group member begins employment.
|
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|
does not
allow directors, executives, or other associates, to engage in pledging, hedging, short
sales, or trading in put and call options with respect to the Company’s securities.
|
|
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|
|
does not
offer employment contracts to U.S.-based Executive Group members.
|
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|
|
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|
|
|
2017 Proxy Statement
|
|
54
|
Compensation Discussion and Analysis
Overview of Compensation Program
MetLife uses a competitive total compensation framework that consists of base salary, annual incentive awards and stock-based long-term incentive award opportunities.
The Compensation Committee considers and recommends the amount of each of these three elements together. It submits its recommendations for the Company’s Chief Executive Officer for approval by the Independent Directors, and for each of the
other Executive Group members for approval by the Board of Directors. For purposes of this discussion and MetLife’s compensation program,
Total Compensation
for an Executive Group member means the total of only these three
elements. Items such as sign-on payments and others that are not determined under the Company’s general executive compensation framework are approved by the Committee, but are generally not included in descriptions of Total Compensation.
The Committee’s Total Compensation decisions are driven by performance. Each Executive Group member’s Total Compensation reflects the Committee’s
assessment of the Company’s and the executive’s performance as well as competitive market data based on peer compensation comparisons. Decisions on the award or payment amount of one element of Total Compensation impact the decisions on
the amount of other elements. The Committee’s Total Compensation approach means that it does not structure particular elements of Total Compensation to relate to separate individual goals or performance.
The Committee allocates a greater portion of the Executive Group members’ Total Compensation to variable components that depend on performance or the value of
Shares rather than a fixed component. It also allocates a greater portion of the
Executive Group members’ variable compensation to stock-based long-term incentives than it allocates to annual cash incentives. Given this mix of pay and other features of MetLife’s
compensation programs, Executive Group members’ interests are aligned with those of shareholders. The Company’s Share ownership requirements further align executives’ interests with those of shareholders and reinforce the focus on
long-term shareholder value.
The Committee also reviews annually the other compensation and benefit programs, such as retirement benefits and potential payments
that would be made if an Executive Group member’s employment were to end. However, benefits such as retirement and medical programs do not impact Total Compensation decisions since they apply to substantially all employees. Decisions about
those benefits do not vary based on decisions about an Executive Group member’s base salary or annual or stock-based awards, or the amount realizable from prior awards.
The Committee’s independent executive compensation consultant, Meridian, assisted it in its design and review of the Company’s compensation program. For more
information on the role of Meridian regarding the Company’s executive compensation program, see “Corporate Governance —Board and Committee Information — Compensation Committee” beginning on page 28.
Generally, the forms of compensation and benefits provided to Executive Group members in the United States are similar to those provided to other U.S.-based
officer-level employees. None of the Executive Group members based in the United States is a party to any agreement with the Company that governs the executive’s employment.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
55
|
Compensation Discussion and Analysis
Components of Compensation and Benefits
The primary components of the Company’s regular executive compensation and benefits program play various strategic roles:
|
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Description
|
|
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|
|
|
Strategic
Role
|
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|
Total Compensation
|
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|
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|
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|
|
|
|
|
|
Base Salary
is determined based on position, scope of responsibilities, individual performance,
and competitive data.
|
|
|
|
|
|
Provides fixed compensation for services during the year.
|
|
|
|
|
|
Annual Incentive Awards
are:
• variable based on performance relative to Company and individual goals and additional business challenges or
opportunities that arose during the year.
• determined through the Compensation Committee assessment of all
of these factors as a whole.
|
|
|
|
|
|
• Serve as the primary compensation vehicle for recognizing and
differentiating individual performance each year.
• Motivate Executive Group members and other employees to
achieve strong annual business results that will contribute to the Company’s long-term success, without creating an incentive to take excessive risk.
|
|
|
|
|
|
Stock-Based Long-Term Incentive Awards
are:
• based on the Compensation Committee’s assessment of individual responsibility, performance, relative
contribution, and potential for assuming increased responsibilities and future contributions.
• dependent on
the value of Shares (Restricted Stock Units), increases in the price of Shares (Stock Options), or a combination of MetLife’s performance as well as the value of Shares (Performance Shares). Cash-paid equivalents are used outside the U.S.
• granted each year to provide overlapping vesting and performance cycles.
• for awards to Executive Group members made as part of Total Compensation for prior year performance and in
expectation of contributions to future performance granted in these proportions:
|
|
|
|
|
|
• Ensure that Executive Group members have a significant continuing stake in
the long-term financial success of the Company (see “Executive Share Ownership” on page 71).
• Align executives’ interests with those of shareholders.
• Encourage decisions and reward performance that contribute to the long- term growth of the Company’s
business and enhance shareholder value.
• Motivate Executive Group members to outperform MetLife’s
competition.
• Encourage executives to remain with MetLife.
|
|
|
|
|
|
Stock-Based
Long-Term
Incentive Mix for Executive Group Members
|
|
|
|
|
|
|
|
|
|
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|
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|
|
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|
|
Benefits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retirement Program and Other Benefits
include post-retirement income (pension) or the opportunity
to save a portion of current compensation for retirement and other future needs (savings and investment program and nonqualified deferred compensation).
|
|
|
|
|
|
Attract and retain executives and other employees.
|
|
|
|
|
|
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|
|
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|
|
|
|
|
|
|
Potential Payments
|
|
|
|
|
|
Severance Pay and Related Benefits
include transition assistance if employment ends due to job elimination or, in limited circumstances, performance.
|
|
|
|
|
|
Encourage focus on transition to other opportunities and allow the Company to obtain a release of employment-related claims.
|
|
|
|
|
|
Change-in-Control Benefits
include:
• double-trigger severance pay and related benefits, if the Executive Group member’s employment is
terminated without cause or the Executive Group member resigns with good reason following a change-in-control.
• replacement or vesting of stock-based long-term incentive awards.
|
|
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|
|
|
• Retain Executive Group members during a change-in-control.
• Promote the unbiased efforts of the Executive Group members to maximize shareholder value during and after a
change-in-control.
• Keep executives whole in situations where Shares may no longer exist or awards otherwise
cannot or will not be replaced.
|
|
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|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
56
|
Compensation Discussion and Analysis
Determining Total
Compensation for 2016 Performance
In determining executive compensation for performance year 2016, the Compensation Committee considered the
Executive Group’s performance both as a whole and individually. The Committee also reviewed reports and analyses on competitive compensation for comparable positions at peer companies and in the broader market where the Company competes for
executive talent.
A description of the process for determining Total Compensation follows.
Process for Determining Chief Executive Officer Compensation
Early in 2016,
Mr. Kandarian and the Committee established goals and objectives that were designed to drive Company performance. The Committee assessed Mr. Kandarian’s 2016 performance against these goals in early 2017. The Committee approved Mr.
Kandarian’s Total Compensation, including annual and stock-based long-term incentives, based on this assessment, and recommended it to the Independent Directors for their approval. For a description of these goals, and the performance the
Committee and Board reviewed, see “Highlights of 2016 Business Results” beginning on page 43 and “Aspects of Individual Performance” beginning on page 48.
Mr. Kandarian’s compensation is higher than other Executive Group members due to Mr. Kandarian’s broader responsibilities and higher levels of
accountability as the most senior executive in the Company, as well as competitive market data.
Process for Determining Compensation of Other Executive Group
Members
Early in 2016, Mr. Kandarian and each Executive Group member agreed on the respective executive’s goals for 2016. In early
2017, Mr. Kandarian provided to the Committee an assessment of each of the Executive Group members’ performance during 2016 relative to their goals and the additional business challenges and opportunities that arose during the year. He
also recommended Total Compensation amounts for each Executive Group member, other than himself. The Committee reviewed these recommendations. It approved and endorsed the components of each Executive
Group member’s Total Compensation for the Board of Directors’ approval. In each case, Mr. Kandarian and the Committee considered the executive’s performance, future potential,
available competitive data, compensation opportunities for each position, retention needs, and fit within the executive talent market, aligned with MetLife’s compensation philosophy and objectives.
The Executive Vice President and Chief Human Resources Officer of the Company (the
CHRO
) provided the Committee with advice and recommendations
on the form and overall level of executive compensation. He also provided guidance and information to Mr. Kandarian to assist him in this process, other than with respect to the CHRO’s own compensation. The CHRO also provided guidance to
the Committee on its general administration of the programs and plans in which Executive Group members, as well as other employees, participate.
Other than as
described above, no Executive Group member played a role in determining the compensation of any of the other Executive Group members. No Executive Group member took part in the Board’s consideration of his or her own compensation. The Chief
Executive Officer does not have any authority to grant Share-based awards of any kind to any Executive Group members, the Chief Accounting Officer, the Chief Risk Officer, or Directors of the Company.
2016 Say-on-Pay Vote and Shareholder Engagement
In 2016, the Company’s shareholders voted by over 97% to approve the Company’s executive compensation programs and policies and the resulting
compensation described in the 2016 Proxy Statement. The prior two years’ results were 98% and 97% positive.
Because the vote was advisory, the result was not
binding on the Compensation Committee. However, the Committee considered the vote to be an endorsement of the Company’s executive compensation programs and policies, and took into account that support in reviewing those programs and policies.
The Company has also discussed the vote, along with aspects of its executive compensation and corporate governance practices, with a number of shareholders to gain a deeper understanding of their perspectives. None of these discussions raised
shareholder concerns about the Company’s current compensation practices.
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2017 Proxy Statement
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57
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Compensation Discussion and Analysis
Base Salary
The base salaries earned by the Named Executive Officers in 2016 are reported in the Summary Compensation Table on page 72. The Compensation Committee approved
annual base salary rate increases of $100,000 for each of Mr. Kandarian and Mr. Goulart, $75,000 for each of Mr. Hele and Mr. Lippert, and the equivalent of approximately $75,000 for Mr. Townsend. See footnote 1 on page 72 regarding currency
exchange rate. Each increase was effective April 1, 2016. These adjustments were made to bring each executive’s salary in line with competitive market data for our peers (described on page 68) and the executive’s level of sustained
relative contribution to the Company.
Annual Incentive Awards
The MetLife Annual Variable Incentive Plan (
AVIP
) provides eligible employees, including the Executive Group members, the opportunity to earn annual cash
incentive awards. For awards for 2016 performance, AVIP was administered as a Cash-Based Awards program under the MetLife, Inc. 2015 Stock and Incentive Compensation Plan (
2015 Stock and Incentive
Plan
). The 2016 AVIP awards are
reported in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table on page 72.
AVIP Performance Funding
Each year, the Committee approves the maximum aggregate amount available for all AVIP awards for substantially all
administrative (non-sales) employees around the world, approximately 31,000 employees for 2016.
Consistent with past practice, this approach uses an
AVIP Performance
Funding Level,
based on the Company’s Operating Earnings compared to the
Company’s 2016 Business Plan, multiplied by the total annual incentive compensation planning targets for all eligible employees, subject to the Committee’s assessment of overall performance and other relevant factors.
The Committee uses Operating Earnings as a key metric because doing so allows it to analyze the Company’s performance relative to its Business Plan. That aligns
compensation with bottom-line performance that generates shareholder value over time. Using Operating Earnings, rather than GAAP net income, focuses on the Company’s primary businesses excluding the impact of market volatility, which could
distort results, and revenues and costs related to areas such as non-core products, divested businesses, and discontinued operations. Operating Earnings excludes the impact of net investment gains and losses and net derivative gains and losses,
which helps mitigate the potential for excessive risk-taking.
For purposes of determining the AVIP Performance Funding Level, the Company’s Operating Earnings
is adjusted to eliminate the impact (if any) of variable investment income on an after-tax basis that was higher or lower than the Business Plan goal by 10% or more (
Adjusted
AVIP Operating Earnings
).
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2017 Proxy Statement
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58
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Compensation Discussion and Analysis
The Committee’s methodology to determine the AVIP Performance Funding Level is outlined in
the following chart, indicating how the Performance Funding Level changes relative to Adjusted Operating Earnings performance:
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Total AVIP Funding for Awards to All Eligible Employees
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See Appendix A for further details.
This approach avoids providing incentives for employees to take excessive risk through several of its features. Operating Earnings excludes net investment gains and losses and net derivative gains and
losses.
The exclusion of after-tax variable investment income outside the 10% range higher or lower than the Business Plan goal also avoids providing rewards or penalties for volatile investment returns. As
a result, this approach does not provide an incentive to take excessive risk in the Company’s investment portfolio and so facilitates prudent risk management. Nor is this approach an unlimited function of revenues. Rather, this approach caps
the amount that can be generated for AVIP awards, and is a function of financial measures that account for the Company’s costs and liabilities.
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2017 Proxy Statement
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59
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Compensation Discussion and Analysis
For 2016 AVIP, the Committee excluded certain items from Operating Earnings:
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($ in millions)
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Costs related to the anticipated Separation
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$
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232
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Non-cash charges:
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Reserve charges:
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Reserve system enhancements
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257
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Actuarial assumption update for variable annuities
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168
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Australia reinsurance claim
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44
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Total
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$
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701
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The Committee excluded Separation costs because the plan for the anticipated Separation was still in development when the
2016 Business Plan was devised. As a result, the costs were not included in the 2016 Business Plan as they were not contemplated or known at the time the Business Plan was established. The Separation is a unique event in which the Company
anticipates spinning-off approximately one-fifth of its business (based on Operating Earnings). Further, the Committee and Board believe that the Separation will produce significant benefits for Company shareholders, such as allowing MetLife to
operate with greater focus, increasing MetLife’s ability to generate distributable cash flows while reducing its balance sheet and income statement volatility, and making MetLife more globally diversified. The Separation may also improve
MetLife’s operating return on equity, after the costs of the Separation are eliminated, and reduce MetLife’s cost of capital and exposure to market risk. Because of these many benefits, the Committee concluded that it was not appropriate
to penalize all 31,000 employees covered under this plan for taking the necessary steps to effect the change
.
The Committee also excluded three non-cash
items, two of which were excluded because they were not the consequence of current management decisions and management did not meaningfully benefit from earlier related outcomes. The other item was excluded because the outcome of a past reinsurance
claim was not yet certain. All of these adjustments represent events that were not known or anticipated at the time the 2016 Business Plan was approved. In addition, the Committee believes that adjusting for these items provides a more accurate view
of management’s performance in 2016. Further details on these three items follow.
First, the Committee excluded a non-cash charge to increase reserves for
products introduced more than 10 years ago, primarily resulting from modeling improvements in the reserving process for universal life products with secondary guarantees. The Company’s reserve charges in prior years were consistent
with its Business Plans and actuarial and accounting practices at the time. As a result, those outcomes did not benefit management’s incentive compensation in those prior years.
Second, the Committee excluded a non-cash charge related to the actuarial assumption review for variable annuities. This reserve increase reflects changes to
policyholder behavior and long-term economic assumptions relating to guaranteed minimum income benefits in certain variable annuity policies. The Company could not previously update assumptions for the related products, which were first offered over
10 years ago. Accounting rules prohibited the Company from updating these assumptions until 2016, when management had sufficient and credible data. As a result, management could not anticipate these charges when establishing the 2016 Business Plan.
The Committee concluded that adjustments for these two non-cash charges were appropriate in light of the circumstances. Over a decade ago, management had used its
best judgment, utilizing relevant experience, to set appropriate reserves for the (now discontinued) products at issue. The Committee concluded that, in order to encourage strong risk management, it should not penalize executives for these
reserve-setting decisions made years before.
Third, the Committee excluded a non-cash charge related to a Company reinsurance claim in Australia for a policy last
renewed in 2011. The Company incurred a charge for the entire amount in dispute after the initial court determination on some of its claims. The Committee determined to defer reflecting the initial court determination until after there was a final
resolution of the dispute.
Individual Annual Incentive Awards
The Committee determined the Executive Group members’ 2016 AVIP awards in consideration of the Company’s key financial performance goals and results described
on pages 44-46 and key aspects of each of the Named Executive Officers’ performance relative to their objectives as discussed on pages 48-51.
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2017 Proxy Statement
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60
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Compensation Discussion and Analysis
Stock-Based Long-Term Incentive Awards
The Company awards Performance Shares, Restricted Stock Units, Stock Options and, in some cases outside the United States, cash-payable equivalents. The Committee
determines the amount of such awards in consideration of the Company’s key financial performance goals and results as part of MetLife’s Total Compensation program. For information about the specific grants of stock-based long-term
incentive awards to the Named Executive Officers in 2016, see the table entitled “Grants of Plan-Based Awards in 2016” on page 78.
Stock Options
The Company grants Stock Options with an exercise price equal to the closing price of Shares on the grant date. The value of Stock Options depends exclusively
on increases in the price of Shares. One-third of each award of Stock Options becomes exercisable on each of the first three anniversaries of the date of grant.
Restricted Stock Units
The Company delivers Shares for Restricted Stock
Units after the end of a predetermined vesting period. Awards generally vest in thirds, and Shares are delivered, after each of the first three anniversaries of the grant date, assuming that the Company meets goals set for purposes related to
Section 162(m) of the United States Internal Revenue Code
(Section 162(m))
(see “Tax Considerations” on page 71).
From time to time, the
Company grants Restricted Stock Units that vest in their entirety on the third or later anniversary of their grant date. It does so in order to encourage a candidate to begin employment with MetLife (especially where the candidate would forfeit
long-term compensation awards from another employer by doing so) or as a means of reinforcing retention efforts, particularly in cases of exceptional performance, critical skills, or talent.
Performance Shares
The Company delivers Shares for Performance Shares after
the end of a three-year performance period. The number of Shares depends on Company performance.
The Compensation Committee approves performance metrics for Performance Share awards based on:
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the Company’s Operating ROE compared to its Business Plan goals; and
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Total shareholder return (
TSR
), which reflects total return on Shares including change in Share price and imputed reinvested dividends, compared to the custom group of competitors listed on page 62.
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The Committee chose Operating ROE because it directly supports the Company’s strategy to achieve superior shareholder returns. Operating ROE
focuses employees on the efficient use of capital, which will drive TSR over time. The use of TSR ensures that final awards are aligned with our shareholder’s experience. The metrics include one
absolute
measure (Operating ROE) to directly link to the Company’s Business Plan and one
relative
measure (TSR) based on a peer group that reflects our business model and global reach.
Each of these two factors is measured over
the three-year performance period and each is weighted equally. Payment is subject to the satisfaction of the applicable Section 162(m) goals and the overall limit of 175% as the maximum performance factor.
The performance factor scales for these measures are shown below. The performance goal for Operating ROE is established at the beginning of each three-year performance
period and is based on a rigorous long-range business plan vetted and approved by the Board of Directors. This Business Plan is informed by macro-economic forecasts as well as industry and peer performance.
The goal for 2016-2018 Performance Share awards will be disclosed after the end of that performance period.
Importantly, the Committee set a rigorous goal that
requires a meaningful stretch above current levels of performance. In addition, as an overall safeguard to ensure alignment with shareholders, the Committee intends to cap the Performance Factor at 100% if the Company’s TSR for the performance
period is zero or negative. This applies even if the Company’s Operating ROE exceeds the performance goal and the Company’s TSR outperforms its peers.
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2017 Proxy Statement
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61
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Compensation Discussion and Analysis
The goal for the 2014-2016 Performance Shares is included at the bottom of the performance factor
chart below.
With respect to the TSR component of the Performance Factor, the Committee assesses the Company’s performance against competitors around the
world. As a result, the TSR metric reflects a group of competitors that is more globally diverse than the Comparator Group the Committee uses for peer Total Compensation purposes.
See Appendix A for further details.
The Committee
may consider how events such as significant unplanned acquisitions or dispositions, unplanned tax, accounting and accounting presentation changes, and unplanned restructuring or reorganization costs affect the Company’s Operating ROE.
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2017 Proxy Statement
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62
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Compensation Discussion and Analysis
The following charts show the metrics the Committee uses to determine the Performance Factor, and
how the outcome is tied to Company performance. The charts also reflect the Committee’s determination of the Performance Factor for the 2014-2016 performance period; this award vested at the end of 2016.
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Operating ROE: 50% Component of
Performance Factor
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TSR: 50% Component of
Performance Factor
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For this purpose the Committee excluded from Operating ROE the same items as it did for purposes of determining the total
funding for 2016 AVIP awards, and for the same reasons. See “Annual Incentive Awards,” beginning on page 58.
The Committee also excluded the same
items from Operating ROE as it has in the past.
For 2015, the Company recorded a non-cash charge of $792 million, net of income tax, related to tax years 2000 to
2009 for a wholly-owned U.K. subsidiary of MLIC. The charge resulted from the Company’s consideration of court decisions upholding the U.S. Internal Revenue Service’s disallowance of foreign tax credits claimed by corporate entities not
affiliated with the Company. The Compensation Committee chose to exclude this
item because it did not relate to the consequences of any current
management decisions and management did not meaningfully benefit from the tax credit in past compensation determinations. Resolution of the Company’s own foreign tax credits awaits filing of
(and determinations regarding) refund claims. The Company expects that, if the charge is later reversed, it will exclude that reversal from its determination of Operating Earnings for applicable executive compensation purposes so that executives do
not benefit.
In 2014, the Company increased its reserves for asbestos litigation. The litigation relates to alleged activities in the 1920’s through the
1950’s, and the reserve increase of $117 million, net of income tax, reflected the fact that the frequency and severity of claims against MLIC relating to asbestos increased. MLIC is named as a defendant in asbestos litigation. MLIC has never
engaged in the business of manufacturing, producing, distributing or selling asbestos or asbestos-containing products.
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2017 Proxy Statement
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Compensation Discussion and Analysis
Nor has MLIC issued liability or workers’ compensation insurance to companies in the business of manufacturing, producing, distributing or selling asbestos or asbestos-containing products.
The lawsuits principally have focused on allegations with respect to certain research, publication and other activities during the period from the 1920’s through approximately the 1950’s and allege that MLIC learned or should have learned
of certain health risks posed by asbestos and, among other things, improperly publicized or failed to disclose those health risks. MLIC believes that it should not have legal liability in these cases. The outcome of most asbestos litigation matters,
however, is uncertain.
Finally, the Company did not engage in as much merger and acquisition activity in 2015 or 2016 as anticipated for the Business Plan
Operating ROE goal. The Committee determined that management had exercised appropriate restraint in pursuing only those acquisitions that were likely to result in profitable growth.
See Appendix A for further details.
For more information, see the
table entitled “Option Exercises and Stock Vested in 2016” on page 83.
Phantom Stock-Based Awards
The Company grants cash-settled stock-based awards (
Phantom Awards
) to employees outside the United States, if paying cash is more appropriate than delivering
Shares in light of tax and other regulatory circumstances. Each vehicle has the same LTI award value, performance metrics, and vesting requirements as its Share-payable equivalent.
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Each
Unit Option
represents the right to receive a cash payment equal to the closing price of a Share on the surrender date chosen by the employee, less the closing price on the grant date. One-third of each
award of Unit Options becomes exercisable on each of the first three anniversaries of the date of grant.
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Performance Units
are units that, if they vest, are multiplied by the same performance factor used for Performance Shares for the applicable period and payable in cash equal to the closing price of a Share.
Payment for Performance Units is contingent on Company achievement of goals set for Section 162(m) purposes.
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Restricted Units
are units that vest on the same schedules as Restricted Stock Units and, if they vest, each is payable in cash equal to the closing price of a Share on the vesting date. Payment for
Restricted Units that vest and pay out in three annual installments is contingent on Company achievement of goals set for Section 162(m) purposes.
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Vesting
For awards granted in 2015 and later, the Company has used an
approach that is simpler and more global than for previous awards. Employees whose combined age and years of MetLife employment is 65 or more, with at least 5 years of MetLife employment (the
Rule of 65
), will retain their awards following
the end of their employment. For awards granted through 2014, employees had to meet age and service criteria related to the U.S. pension program or to U.S. post-retirement medical benefits eligibility to retain their awards following employment.
Restrictive Covenants
In order to protect the Company, stock-based
long-term incentive awards provide that Executive Group members who leave MetLife and provide services to a competitor, or any employee who violates MetLife’s agreement to protect corporate property, may lose those awards. The agreement to
protect corporate property protects MetLife’s ownership of its property and information (including intellectual property) and prohibits the employee from interfering with MetLife’s business or soliciting MetLife’s employees or certain
of its agents to leave MetLife until 18 months following the end of employment.
Retirement and Other Benefits
MetLife recognizes the importance of providing comprehensive, cost-effective benefits to attract, retain, engage, and motivate talented employees. The
Company reviews its benefits program from time to time and makes adjustments to the design of the program to meet these objectives and to remain competitive with other employers.
Pension Program for U.S.-Based Executives
The Company sponsors a pension
program in which all eligible U.S. employees, including the Executive Group members employed in the U.S., participate after one year of service. The program rewards employees for the length of their service and, indirectly, for their job
performance, because the amount of benefits increases with the length of employees’ service with the Company and the salary and annual incentive awards they earn.
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2017 Proxy Statement
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Compensation Discussion and Analysis
The program includes the Metropolitan Life Retirement Plan for United States Employees (the
Retirement Plan
) and
the MetLife Auxiliary Pension Plan (
Auxiliary Pension Plan
), an unfunded nonqualified plan. The Auxiliary Pension Plan provides pension benefits for any Executive Group members that would apply under the (qualified) Retirement Plan if U.S.
tax limits on eligible compensation did not apply. It provides no additional or special benefits for Executive Group members. The same compensation formulae were used for benefits accrued in both plans in 2016.
For additional information about pension benefits for the Named Executive Officers, see the table entitled “Pension Benefits at 2016 Fiscal Year-End” on
page 84.
Mr. Townsend did not participate in a defined benefit pension plan in 2016.
Mandatory Provident Fund Applicable to Mr. Townsend
Mr. Townsend participates in the Mandatory Provident Fund program for employees in Hong Kong. Applicable law requires employers and employees to contribute a fixed
portion of employees’ earnings to the program, and allows employer and employees to make additional contributions. Because the rate and vesting of employer contributions are based on length of service, the program encourages employees to remain
with the Company.
Savings and Investment Program for U.S.-Based Executives
The Company sponsors a savings and investment program for U.S. employees in which each Executive Group member employed in the U.S. is eligible to contribute a portion of
eligible compensation. U.S. employees are also eligible for Company contributions after one year of employee service in order to encourage and reward such savings.
The program includes the Savings and Investment Plan for Employees of Metropolitan Life and Participating Affiliates (
Savings and Investment Plan
), a
tax-qualified defined contribution plan that includes pre-tax deferrals under Internal Revenue Code Section 401(k), and the Metropolitan Life Auxiliary Savings and Investment Plan (
Auxiliary Savings and
Investment Plan
), an
unfunded nonqualified deferred compensation plan. The Auxiliary Savings and Investment Plan provides Company contributions for employees who elect to
contribute to the Savings and Investment Plan and who have compensation beyond Internal Revenue Code limits.
Company contributions for the Named Executive Officers are included in the “All Other Compensation” column of the Summary Compensation Table on page 72.
Because the Auxiliary Savings and Investment Plan is a nonqualified deferred
compensation plan, the Company’s contributions to the Named Executive
Officers’ accounts, and the Named Executive Officers’ accumulated account balances and any payouts made during 2016, are reported in the table entitled “Nonqualified Deferred Compensation at 2016 Fiscal Year-End” on page 86.
Nonqualified Deferred Compensation Program for U.S.-Based Executives
The Company sponsors a nonqualified deferred compensation program for employees at the Assistant Vice-President level and above in the United States, including the
Executive Group members employed in the U.S. The continued deferral of income taxation and pre-tax simulated investment earnings credited to participants through the employee’s chosen payment dates encourage employees to remain with the
Company.
See the table entitled “Nonqualified Deferred Compensation at 2016 Fiscal Year-End” on page 86 for amounts of nonqualified deferred
compensation reported for the Named Executive Officers.
Perquisites
The Company provides its Executive Group members with limited perquisites.
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To maximize the accessibility of Executive Group members, the Company makes leased vehicles and drivers and outside car services available to U.S.-based executives for commuting and personal use.
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The Company leases an aircraft for purposes of efficient business travel by the Company’s executives. While the Chief Executive Officer may occasionally use the Company’s aircraft for personal travel, Company
policy does not require him to use the Company’s aircraft for all personal and business travel. The Company also does not pay, or gross-up any compensation to cover, the CEO’s income taxes on this or other perquisites.
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For recordkeeping and administrative convenience of the Company, the Company pays certain other costs, such as those for travel and meals for family members accompanying Executive Group members on business functions.
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2017 Proxy Statement
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Compensation Discussion and Analysis
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The Company holds events to facilitate and strengthen its relationship with customers, potential customers, and other business partners, such as events at MetLife Stadium. The Company occasionally allows employees,
including the Executive Group members, and their family members, personal use of its facilities at MetLife Stadium, to the extent space at such events is available or the facilities are not in use for business purposes.
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• The Company provides benefits to Mr. Townsend in connection with his overseas assignment that are common for senior
management in such circumstances, such as a subsidy of children’s education expenses, tax return preparation assistance, and benefits related to housing.
Aside from limited business travel tax equalization for Executive Group members based outside the United States, each Executive Group member is responsible for any
personal income taxes due as a result of receiving these benefits.
The incremental cost of perquisites provided to the Named Executive Officers in respect of 2016
is included in the “All Other Compensation” column of the Summary Compensation Table on page 72, if the total cost of those perquisites for that executive exceeded $10,000.
Sign-On Payments
From time to time, the Company offers newly-hired Executive Group members sign-on payments and/or relocation benefits in order to encourage them to come to MetLife. On
such occasions, the Company typically either delays the date the payment is earned and paid or requires repayment if the executive leaves MetLife before the first anniversary (or, in some cases, second or third anniversary) of beginning employment.
Business Travel Income Tax Equalization
As executives of a
global enterprise, MetLife Executive Group members are engaged in international business travel. Some executives are required by the demands of their roles to travel to jurisdictions that impose additional taxes on them beyond what they owe in
their home jurisdiction. MetLife has established business travel income tax equalization arrangements with its Executive Group members based outside the United States. Providing such executives with “income tax equalization” to
their home jurisdiction, by paying or reimbursing the executive for any excess income taxes the executive owes in other jurisdictions as a result of business travel, is a prevalent business
practice. Doing so allows the executive to engage in business travel that is necessary to lead MetLife’s business efforts and perform job responsibilities without being financially penalized. It also prevents the additional personal income tax
liability from being a disincentive to engage with employees, customers, or others outside of the executive’s home jurisdiction. The arrangements do not provide for equalizing taxes the executive owes as a result of travel taken solely for
personal purposes. Mr. Townsend had such an agreement in 2016.
Potential Payments
Severance Pay and Related Benefits
The following describes the
Company’s standard severance program and how it was applied in 2016. The Company may, in the future, enter into severance agreements that differ from the general terms of the program where business circumstances warrant.
If the employment of a U.S.-based Executive Group member ends involuntarily due to job elimination or, in limited circumstances, due to performance, he or she may be
eligible for the severance program available to substantially all salaried employees. The program generally provides employees with severance pay, outplacement services and other benefits. Employees terminated for cause, as defined under the
program, are not eligible. The amount of severance pay reflects the employees’ salary grade, base salary rate, and length of service. The severance pay formula for officer-level employees is potentially higher than that for other employees.
Longer-service employees receive greater payments and benefits than shorter-service employees, given the same salary grade and base salary. Depending on the terms of the particular award, employees who meet the Rule of 65 or other
applicable age and service criteria, retain their outstanding stock-based long-term incentive awards. Otherwise, employees who receive severance pay also receive a pro rata cash payment in consideration of certain unretained Performance Shares,
Performance Units, Restricted Stock Units, and Restricted Units (generally, those awards granted at least one year earlier).
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2017 Proxy Statement
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Compensation Discussion and Analysis
Change-in-Control Arrangements
The Company has adopted arrangements that would impact the Executive Group members’ compensation and benefits upon a change-in-control of MetLife. None of the
Executive Group members is entitled to any excise tax gross-up either on severance pay or on any other benefits payable in connection with a change-in-control of the Company.
The Company established the MetLife Executive Severance Plan (
Executive Severance Plan
) in 2007 to apply to all Executive Group members and replace individual
change-in-control agreements.
The Compensation Committee determined the terms of the plan based on its judgment of what is necessary to maximize shareholder value
should a change-in-control occur. The Company designed the elements of its change-in-control definition to include circumstances where effective control over the Company would be captured by interests that differ substantially from those of the
broad shareholder base the Company now has, without impinging on the Company’s flexibility to engage in transactions that are unlikely to involve such a transformation. An Executive Group member who receives benefits under the Executive
Severance Plan would not
also be eligible to receive severance pay under the Company’s severance plan that is available to substantially all salaried employees.
The Executive Severance Plan does not provide for any payments or benefits based solely on a change-in-control of MetLife.
Rather, the Plan provides for severance pay and related benefits only if the executive’s employment also ends under certain circumstances.
The Company’s stock-based long-term agreements also include change-in-control arrangements. Under these arrangements, MetLife or its successor may substitute an
alternative award of equivalent value and vesting provisions no less favorable than the award being replaced. Only if such substitution does not occur would the awards vest immediately upon a change-in-control.
For additional information about change-in-control arrangements, including the Company’s definition of change-in-control for these purposes, see “Potential
Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End” beginning on page 91.
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|
|
|
2017 Proxy Statement
|
|
67
|
Compensation Discussion and Analysis
The Compensation Committee periodically reviews the competitiveness of MetLife’s Total Compensation framework using data
reflecting a comparator group of companies in the insurance and broader financial services industries with which MetLife competes for executive talent (the
Comparator Group
).
The Committee chose the members of the Comparator Group based on the size of the firms relative to MetLife and the extent of their global presence or their similarity to
MetLife in the importance of investment and risk management to their businesses, as well as their being competitors for executive talent. It reviews the composition of the Comparator Group from time to time to ensure that the group remains an
appropriate comparator group for the Company. The Committee changed the group in 2016, eliminating ING Groep and Aegon because regulatory requirements in the Netherlands make these companies no longer representative of the competitive market for
MetLife’s executives. The resulting Comparator Group consists of the 17 financial services companies shown below.
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|
|
|
2017 Proxy Statement
|
|
68
|
Compensation Discussion and Analysis
|
1
|
MetLife is excluded from the Comparator Group when determining its percentile rank.
|
See Appendix A for
further details.
In determining the Executive Group member’s Total Compensation for 2016, the Committee considered
the
increasingly global nature of the Company’s business and the Company’s size, scope, and complexity relative to its peers, the challenges the Executive Group faces, and the Committee’s expectations for the executive’s and the
Company’s performance
. MetLife’s competitive compensation philosophy is
generally to provide Total Compensation around the size-adjusted median for like positions at Comparator Group companies, taking into account
MetLife’s assets, revenue, and market capitalization relative to other companies in the Comparator Group.
As a result, the Committee considered an Executive Group member’s Total Compensation to be
competitive if it fell
within a reasonable range of that size-adjusted median
. The Committee reviewed individual elements of the Executive Group members’ Total Compensation in
comparison to available Comparator Group data, with a primary focus on Total Compensation.
For 2016 performance, each Named Executive Officer’s Total Compensation fell between 80% and 120% of the point representing the size-adjusted
median for his position. While the comparison to the range is a part of the compensation framework, the ultimate determinations vary based on individual factors such as performance, expectations of contributions to future performance, experience,
and retention considerations.
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|
|
|
2017 Proxy Statement
|
|
69
|
Compensation Discussion and Analysis
Risk Management
MetLife’s compensation program leverages best practices and has a number of features that contribute to prudent decision making and do not incent executives to
take excessive risks.
|
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Incentive compensation aligned with risk
management
|
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|
|
•
Operating Earnings – an important incentive compensation metric –
excludes net investment gains and losses and net derivative gains and losses
•
Removes incentives not to hedge exposures to various risks inherent in a number of
products, or to harvest capital gains for the sole purpose of enhancing incentive compensation
•
Aligned with Company policy not to use derivatives for speculative purposes
•
Company
assesses Executives’ performance in risk management and governance practices
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|
Long-term focus
|
|
|
|
•
Three-year overlapping performance periods and vesting for long-term incentive
compensation
•
Time horizons for compensation reflect the extended time horizons for the results
of many business decisions.
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|
|
Performance-based
compensation recoupment
policy
|
|
|
|
•
Applies to all employees, including Executive Group members
•
Company may
seek recovery of performance-based compensation with respect to period of misconduct
•
Misconduct is fraudulent or other wrongful conduct that causes the Company or its
business financial or reputational harm
•
Reinforces the Company intent to consider recovering compensation where the policy applies
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|
|
Hedging and pledging policies
|
|
|
|
•
Directors and employees, including Executive Group members, may not short-sell,
hedge, trade in put and call options in, or pledge their Company securities
•
Intended to prevent a misalignment, or appearance of misalignment, of interests
with shareholders
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|
|
Annual risk-review of incentive compensation
programs
|
|
|
|
•
Chief Risk Officer reviews programs and reports to the Compensation Committee
•
Intended to
ensure that programs do not encourage excessive risk-taking
•
Analyzes performance measures, performance periods, payment determination
processes, management controls, and risk management processes
•
Chief Risk Officer concluded that compensation programs did not encourage
excessive risk-taking and, as a result, are not reasonably likely to have a material adverse effect on the Company
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Share ownership
requirements
|
|
|
|
•
Ensure that executives’ interests are aligned with those of shareholders
•
Encourages
prudent risk-taking to the long-term benefit of shareholders
•
Applies to employees at Senior Vice-President level and above, including Executive
Group members
•
Requires retention of all net Shares acquired from compensation awards, unless the
employee’s ownership is above the requirement
|
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|
2017 Proxy Statement
|
|
70
|
Compensation Discussion and Analysis
Executive Share Ownership
The Share ownership of the Named Executive Officers as of December 31, 2016 was:
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Name
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|
Requirement
|
|
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|
|
|
Ownership
at or Above
Requirement
|
|
|
|
|
|
|
|
Compliant with
100% Net
Share Retention
Requirements
|
|
|
|
|
|
|
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|
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|
|
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|
|
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|
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|
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|
|
|
|
|
|
Steven A.
Kandarian
|
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|
|
|
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|
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|
|
|
7
|
|
|
|
|
|
|
|
✓
|
|
|
|
|
|
|
|
✓
|
|
|
|
|
|
|
|
|
|
|
|
John C. R. Hele
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
✓
|
|
|
|
|
|
|
|
|
|
|
|
Martin J.
Lippert
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
✓
|
|
|
|
|
|
|
|
|
|
|
|
Steven J.
Goulart
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
✓
|
|
|
|
|
|
|
|
|
|
|
|
Christopher G.
Townsend
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
✓
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
The Company does not allow employees to count outstanding Share awards toward these requirements. Employees may count the
value of Shares they or their immediate family members own directly or in trust. They may also count Shares held in the Company’s savings and investment program, Shares deferred under the Company’s nonqualified deferred compensation
program and deferred cash compensation or auxiliary benefits measured in Share value. Mr. Lippert joined the Company in 2011, and Mr. Hele and Mr. Townsend joined the Company in 2012. Each of them, and each of the other Named Executive
Officers, also has significant outstanding awards deliverable in Shares (or payment in cash equivalent to Share value) that align his interests with those of shareholders.
Stock-Based Award Timing Practices
The Compensation Committee grants stock-based long-term incentive awards to the Executive Group members at its regularly scheduled meeting in February of
each year. The exercise price of Stock Options or Unit Options is the closing price of a Share on the grant date. On the rare occasions when the Committee grants awards in connection with the hiring or change in responsibilities of an Executive
Group member, or in order to encourage the executive to remain employed, it does so coincident with (or shortly after) the hiring, change in responsibilities, or other related changes. The Company has never granted, and has no plans to grant, any
stock-based awards to current or new employees in anticipation of the release of non-public information about the Company or any other company.
Tax Considerations
Section 162(m) of the United States Internal Revenue Code
limits the deductibility of compensation paid to certain executives, but exempts certain
“performance-based” compensation from those limits. For 2016, the Compensation Committee established limits and performance goals in order for AVIP awards to the Company’s Executive Group members to be eligible for this exemption. As
part of the Section 162(m) goal-setting process for 2016, the Committee set the maximum amount that any Executive Group member could be paid as an AVIP award at $10 million. See “Non-Equity Incentive Plan Awards” on page 78
for more information about the individual maximums set for 2016 AVIP awards. The Company has also designed Performance Shares, Stock Options and (with respect to regular awards to Executive Group members) Restricted Stock Units with the intention of
making them eligible for the “performance-based compensation” exemption from Section 162(m) limits. However, the Committee reserves the right to grant compensation that does not meet Section 162(m) requirements if it determines
it is appropriate to do so.
Accounting Considerations
Stock Options and Restricted Stock Units qualify as equity-classified instruments whose fair value for determining compensation expense under current accounting rules is
fixed on the date of grant. The Compensation Committee approved metrics to determine the performance factor applicable to Performance Shares granted in 2013 and later, and retained the ability to adjust them, or to consider other factors, should it
find that it is appropriate to do so. As a result, these awards qualify for expense reporting on a variable basis. Phantom Awards qualify for expense reporting on a liability basis because they are paid in cash.
|
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|
|
|
|
|
|
2017 Proxy Statement
|
|
71
|
Summary Compensation Table
Summary Compensation Table
|
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|
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|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and
Principal
Position
|
|
|
|
|
|
|
|
Year
|
|
|
|
|
|
Salary
($)
|
|
|
|
|
|
|
|
|
Bonus
($)
|
|
|
|
|
|
|
|
|
Stock
Awards
($)
|
|
|
|
|
|
|
|
|
Option
Awards
($)
|
|
|
|
|
|
|
|
|
Non-Equity
Incentive Plan
Compensation
($)
|
|
|
|
|
|
|
|
|
Change in
Pension
Value
and
Nonqualified
Deferred
Compensation
Earnings
($)
|
|
|
|
|
|
|
|
|
All Other
Compensation
($)
|
|
|
|
|
|
|
|
|
Total
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A.
Kandarian
Chairman of the
Board, President
and Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
2016
2015
2014
|
|
|
|
|
|
|
$1,525,000
$1,425,000
$1,325,000
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
$ 0
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$6,874,761
$6,837,430
$6,027,795
|
|
|
|
|
|
|
|
|
|
|
|
$1,897,550
$1,939,582
$1,806,120
|
|
|
|
|
|
|
|
|
|
|
|
$4,000,000
$4,500,000
$5,000,000
|
|
|
|
|
|
|
|
|
|
|
|
$705,651
$724,960
$709,963
|
|
|
|
|
|
|
|
|
|
|
|
$278,977
$273,909
$294,924
|
|
|
|
|
|
|
|
|
|
|
|
$15,281,939
$15,700,881
$15,163,802
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John C. R. Hele
Executive Vice President and
Chief
Financial Officer
|
|
|
|
|
|
|
|
|
|
2016
2015
2014
|
|
|
|
|
|
|
$ 781,250
$ 706,250
$ 637,500
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
$ 0
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$1,964,270
$2,051,234
$1,870,695
|
|
|
|
|
|
|
|
|
|
|
|
$ 542,164
$ 581,876
$ 560,409
|
|
|
|
|
|
|
|
|
|
|
|
$2,000,000
$2,200,000
$2,200,000
|
|
|
|
|
|
|
|
|
|
|
|
$313,841
$297,271
$213,406
|
|
|
|
|
|
|
|
|
|
|
|
$104,275
$101,741
$ 75,123
|
|
|
|
|
|
|
|
|
|
|
|
$ 5,705,800
$ 5,938,372
$ 5,557,133
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Martin J. Lippert
Executive Vice
President, Global
Technology & Operations
|
|
|
|
|
|
|
|
|
|
2016
2015
2014
|
|
|
|
|
|
|
$ 756,250
$ 681,250
$ 625,000
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
$ 0
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$1,833,297
$1,846,125
$1,732,125
|
|
|
|
|
|
|
|
|
|
|
|
$ 506,013
$ 523,692
$ 518,903
|
|
|
|
|
|
|
|
|
|
|
|
$2,100,000
$2,300,000
$2,200,000
|
|
|
|
|
|
|
|
|
|
|
|
$328,378
$301,478
$245,080
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
$ 0
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 5,523,938
$ 5,652,545
$ 5,321,108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven J. Goulart
Executive Vice
President and Chief
Investment Officer
|
|
|
|
|
|
|
|
|
|
2016
2015
|
|
|
|
|
|
|
$ 725,000
$ 637,500
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$1,636,886
$1,367,505
|
|
|
|
|
|
|
|
|
|
|
|
$ 451,805
$ 387,922
|
|
|
|
|
|
|
|
|
|
|
|
$1,500,000
$1,400,000
|
|
|
|
|
|
|
|
|
|
|
|
$242,190
$196,785
|
|
|
|
|
|
|
|
|
|
|
|
$ 85,000
$ 83,580
|
|
|
|
|
|
|
|
|
|
|
|
$ 4,640,881
$ 4,073,292
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christopher G.
|
|
|
|
|
|
|
|
|
|
2016
|
|
|
|
|
|
|
$ 656,493
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$1,178,562
|
|
|
|
|
|
|
|
|
|
|
|
$ 325,295
|
|
|
|
|
|
|
|
|
|
|
|
$1,001,552
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$672,215
|
|
|
|
|
|
|
|
|
|
|
|
$ 3,834,117
|
|
|
|
|
|
|
Townsend(1)
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
$ 587,236
|
|
|
|
|
|
|
|
|
|
|
|
$199,659
|
|
|
|
|
|
|
|
|
|
|
|
$1,093,994
|
|
|
|
|
|
|
|
|
|
|
|
$ 310,335
|
|
|
|
|
|
|
|
|
|
|
|
$1,099,172
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$508,035
|
|
|
|
|
|
|
|
|
|
|
|
$ 3,798,431
|
|
|
|
|
|
|
President, Asia
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
$ 537,532
|
|
|
|
|
|
|
|
|
|
|
|
$200,010
|
|
|
|
|
|
|
|
|
|
|
|
$1,039,275
|
|
|
|
|
|
|
|
|
|
|
|
$ 311,345
|
|
|
|
|
|
|
|
|
|
|
|
$ 951,838
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$629,052
|
|
|
|
|
|
|
|
|
|
|
|
$ 3,669,052
|
|
|
|
|
1
|
Mr. Townsend was paid a cash sign-on bonus in each of 2013, 2014, and 2015 on the first three anniversaries of the date his employment began, which is reported in the Bonus column. The final payment was made in 2015.
|
Mr. Townsend did not participate in a defined benefit pension plan in 2014, 2015, or 2016, which is reflected in the Change in Pension
Value and Nonqualified Deferred Compensation Earnings column.
The amount of tax equalization benefits is a component of the amount disclosed in the
All Other Compensation column for Mr. Townsend. The amount reported for tax equalization benefits for 2015 in the Company’s 2016 Proxy Statement was $292,438. That amount was based on an estimate of such benefits, as the amount could not
be determined due to differences between various jurisdictions’ tax years and the Company’s fiscal year. The amount of the benefit has now been determined to have been $202,187. This amount is reflected in the All Other Compensation and
Total columns for Mr. Townsend for 2015 in this table. Accordingly, the amounts disclosed in the All Other Compensation and Total columns for Mr. Townsend for 2015 in this table are different from the amounts in such columns in the Summary
Compensation Table in the Company’s 2016 Proxy Statement.
Amounts for Mr. Townsend for 2016 in this table, and other executive compensation
disclosure in this Proxy statement, that were denominated, accrued, earned, or paid in Hong Kong dollars have been converted to U.S. dollars at a rate of U.S.$1 = H.K.$7.759. In addition, the amounts in the Salary and Non-Equity
Incentive Plan Compensation columns for 2016 differ from the amounts reviewed by the Compensation Committee. See “Incentive Compensation Decisions for 2016 Performance” on page 52. Amounts reported for 2015 and 2014 have not been adjusted
from amounts reported in the Company’s 2016 Proxy Statement to reflect the change to the exchange rate used in this Proxy Statement compared to the Company’s 2016 Proxy Statement.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
72
|
Summary Compensation Table
Basis for the information in the Summary Compensation Table
The amounts reported in the table above for 2016 include several elements that were not paid to the Named Executive Officers in 2016. The table includes items such as
salary and cash incentive compensation that have been earned. It also includes the grant date fair value of Share-based long-term incentive awards granted in 2016 which may never become payable or be delivered, or may ultimately have a value that
differs substantially from the values reported in this table. The table also includes changes in the value of pension benefits from prior year-end to year-end 2016 which will become payable only after the Named Executive Officer ends employment. The
items and amounts reported in the table above for 2015 and 2014 bear a similar relationship to performance and amounts paid or payable in those years.
In addition,
the amounts in the Total column do not represent “Total Compensation” as defined for purposes of the Company’s compensation framework and philosophy, and include elements that do not relate to 2016 performance. For additional
information, see the Compensation Discussion and Analysis beginning on page 41.
The Company is required to include compensation in the Summary Compensation
Table for either of the two years prior to 2016 to the extent that it was disclosed in any of its prior Proxy Statements. Mr. Goulart was not a Named Executive Officer in the Company’s 2015
Proxy Statement. As a result,
his
compensation for
2014 is not reported in the table above.
The amounts in each of the columns of the Summary Compensation Table are further discussed
in the following.
Salary
The amount reported in the Salary column is
the amount of base salary earned by each Named Executive Officer in that year.
For the relationship of each Named Executive Officer’s 2016 base salary
earnings to that officer’s 2016 Total Compensation, see the Proxy Summary on page 5.
Stock Awards
Performance Shares and Performance Units.
The Company granted Performance Shares
and Performance Units in 2016 pursuant to the 2015 Stock and Incentive Plan. No monetary
consideration was paid by a Named Executive Officer for any awards. No dividends or dividend equivalents are earned on any awards. For a description of the effect on the awards of a termination
of employment or change-in-control of MetLife, see “Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End” beginning on page
91.
Performance Shares are delivered in Shares. Performance Units are paid in cash using the price of Shares.
On February 23, 2016, the Compensation Committee granted
Performance Shares to each Named Executive Officer, except that it granted Mr. Townsend
Performance Units. The Company may deliver Shares (or pay cash, in the case of Performance Units) after the end of the three-year performance period from January 1, 2016 to December 31, 2018. In order for these awards to be eligible to be
fully tax deductible under Section 162(m), the Compensation Committee established separate threshold goals. As a result, for the Company to deliver Shares (or pay cash, in the case of Performance Units), the Company must generate either
(1) positive income from continuing operations before provision for income tax, excluding net investment gains (losses) (defined in accordance with Section 3(a) of Article 7.04 of SEC Regulation
S-X),
which includes total net investment gains (losses) and net derivatives gains (losses), either for the third year of the performance period or for the performance period as a whole, or (2) positive
TSR either for the third year of the performance period or for the performance period as a whole.
If any of the above income or TSR goals are met, the number of
Shares the Company delivers (or amount of cash it pays, in the case of Performance Units) at the end of the performance period is calculated by multiplying the number of Performance Shares or Performance Units by a performance factor (from 0% to
175%). The performance factor is to be determined by the Compensation Committee in consideration of the Company’s annual Operating ROE compared to its three-year business plan and TSR during the performance period compared to the Company’s
peers and other factors the Compensation Committee determines relevant.
For a further discussion of the performance goals applicable to the Performance Share and
Performance Unit awards in 2016, see the Compensation Discussion and Analysis beginning on page 41. For a discussion of the 2015 and 2014 Performance
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
73
|
Summary Compensation Table
Share
and Performance Unit
awards, see the Company’s 2016 and 2015 Proxy Statements, respectively.
Restricted Stock Units and Restricted Units.
The Company granted Restricted Stock
Units and Restricted Units in 2016 pursuant to the 2015 Stock and Incentive Plan
. No monetary consideration was paid by a Named Executive Officer for any awards. No dividends or dividend equivalents are earned on any awards. For a description
of the effect on the awards of a termination of employment or change-in-control of MetLife, see “Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End” beginning on page 91.
Restricted Stock Units are delivered in Shares. Restricted Units are paid in cash using the price of Shares.
On February 23, 2016, the Compensation Committee granted Restricted Stock Units to each Named Executive Officer, except that it granted Mr. Townsend Restricted Units.
One-third of each of these awards vests on the first business day of March following each of the first three anniversaries of the grant date. In order for each tranche of these awards to be eligible to be fully tax deductible under
Section 162(m), the Compensation Committee established separate threshold goals. As a result, for the Company to deliver Shares (or pay cash, in the case of Restricted Units), the Company must generate either (1) positive income from
continuing operations before provision for income tax, excluding net investment gains (losses) (defined in accordance with Section 3(a) of Article 7.04 of SEC Regulation
S-X),
which includes total net
investment gains (losses) and net derivatives gains (losses) in the calendar year immediately preceding the anniversary date on which the tranche vests, or (2) positive TSR either for the calendar year immediately preceding the anniversary date
on which the tranche vests.
For a discussion of the 2015 and 2014 Restricted Stock Unit
and Restricted Unit
awards, see the Company’s 2016 and
2015 Proxy Statements.
Method for Determining Amounts Reported.
The
amounts reported in this column for Stock Awards
were calculated by multiplying the number of Shares or units by their respective grant date fair value:
|
•
|
|
$33.54 for February 23, 2016.
|
|
•
|
|
$46.85 for February 24, 2015.
|
|
•
|
|
$46.19 for February 25, 2014.
|
Those amounts represent the aggregate grant date fair value of the awards under ASC 718 consistent with the estimate of
aggregate compensation cost to be recognized over the service period.
For Performance Shares and Performance Units, the amounts are based on target performance, which is a total performance factor of 100%. This is the “probable
outcome” of the performance conditions to which those awards are subject, determined under ASC 718. The grant date fair values of the Performance Shares and Performance Units assuming the highest level of performance conditions would be 1.75
times the amounts included in this column, rounded down to the nearest whole Share (or Share equivalent), because the same grant date fair value per share would be used but the total performance factor used would be 175%. For 2016 Performance Share
and Performance Unit awards, that would produce the following hypothetical Grant Date Fair Values:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
|
|
Hypothetical Grant
Date Fair
Value of 2016
Performance Shares and
Performance Units at
Maximum Performance Level
|
|
|
|
|
|
Steven A. Kandarian
|
|
|
|
|
|
$8,020,554
|
|
|
|
|
|
John C. R. Hele
|
|
|
|
|
|
$2,291,621
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
$2,138,846
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
$1,909,701
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
$1,374,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For a description of the assumptions made in determining the expenses of Share awards, see Notes
1 and 16
to the
Consolidated Financial Statements in the 2016, 2015, and 2014 Forms 10-K. In determining these expenses, it was assumed that each Named Executive Officer would satisfy any service requirements for vesting of the award. As a result, while a
discount for the possibility of forfeiture of the award for this reason was applied to determine the expenses of these awards as reported in the Company’s Annual Reports on Form 10-K, no such discount was applied in determining the expenses
reported in this column.
Option Awards
Stock Option awards were granted
in 2016 pursuant to the 2015 Stock and Incentive Plan. No monetary consideration was paid by a Named Executive Officer for any awards. For a description of the effect on the awards of a termination of
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
74
|
Summary Compensation Table
employment or change-in-control of MetLife, see “Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End” beginning on page 91.
On February 23, 2016, the Compensation Committee granted Stock Options to each Named Executive Officer. Each of these awards had a per option exercise price equal
to the closing price of a Share on the grant date: $38.42. The Stock Options will normally become exercisable at the rate of one-third of each grant on each of the first three anniversaries of the grant date, and expire on the day before the tenth
anniversary of that grant date.
For a discussion of the 2015 and 2014 Stock Options, see the Company’s 2016 and 2015 Proxy Statements, respectively.
Method for Determining Amounts Reported.
The amounts reported in this column
were calculated by multiplying the number of Stock Options by a grant date fair value per option of:
|
•
|
|
$9.26 for February 23, 2016.
|
|
•
|
|
$13.29 for February 24, 2015.
|
|
•
|
|
$13.84 for February 25, 2014.
|
Those amounts represent the aggregate grant date fair value of the Stock Options
granted in each year under ASC 718, consistent with the estimate of aggregate compensation cost to be recognized over the service period.
For a description of the
assumptions made in determining the expenses of Stock Option awards, see Notes
1 and 16
to the Consolidated Financial Statements in the 2016, 2015, and 2014 Forms 10-K. In determining these expenses, it was assumed that each Named
Executive Officer would satisfy any service requirements for vesting of the award. As a result, while a discount for the possibility of forfeiture of the award was applied to determine the expenses of these awards as reported in the Company’s
Annual Reports on Form 10-K, no such discount was applied in determining the expenses reported in this column. In each case, the grant date of the awards was the date that the Compensation Committee approved the awards.
Non-Equity Incentive Plan Compensation
The amounts reported in the
Non-Equity Incentive Plan Compensation column for each Named Executive Officer include the 2016 AVIP awards made in February 2017 by the
Compensation Committee to each of the Named Executive Officers, which are based on 2016 performance. The awards were made pursuant to the 2015 Stock and Incentive Plan and are payable in cash by
March 15, 2017. The factors considered and analyzed by the Compensation Committee in determining the awards are discussed in the Compensation Discussion and Analysis. For a description of the maximum award formula that applied to the awards for
tax deductibility purposes, see the table entitled “Grants of Plan-Based Awards in 2016” on page 78.
Amounts reported in this column for 2015 and
2014 are AVIP awards with a similar relationship to performance in those years. The basis of these awards to the Named Executive Officers who appear in the Company’s 2016 and 2015 Proxy Statements, respectively, is discussed further in those
Proxy Statements.
Change in Pension Value and Nonqualified Deferred Compensation Earnings
The amounts reported in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column for 2016 represent any aggregate increase during 2016 in the
present value of accumulated pension benefits for each of the Named Executive Officers who participates in a defined benefit pension plan. The increase in the present value of these benefits reflects additional service in 2016, base salary
compensation earned in 2016 (reflecting any increases in base salary rate), annual incentive awards payable in March 2016 for 2015 performance. The U.S.-based Named Executive Officers participate in the same retirement program that applies to other
administrative employees in the U.S. For a description of pension benefits, including the formula for determining benefits, see the table entitled “Pension Benefits at 2016 Fiscal Year-End” on page 84.
None of the Named Executive Officers’ earnings on their nonqualified deferred compensation in
2016, 2015, or 2014 were above-market or preferential. As a
result, earnings credited on their nonqualified deferred compensation are not required to be, nor are they, reflected in this column. For a description of the Company’s nonqualified deferred compensation plans and the simulated investments used
to determine earnings, see the table entitled “Nonqualified Deferred Compensation at 2016 Fiscal Year-End” on page 86.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
75
|
Summary Compensation Table
All Other Compensation
The amounts reported in this column for 2016 include all other items of compensation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
Employer
Savings and
Investment
Program and
Mandatory
Provident Fund
Contributions
|
|
|
|
|
|
Perquisites
and
Other
Personal
Benefits(1)
|
|
|
|
|
|
|
Life
Insurance
Above
Standard
Formula
|
|
|
|
|
|
|
|
|
Health
Insurance
Above
Standard
Formula
|
|
|
|
|
|
|
|
|
Tax
Equalization
Benefits
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A. Kandarian
|
|
|
|
|
|
|
|
$241,000
|
|
|
|
|
|
|
$ 37,977
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$278,977
|
|
|
|
|
|
John C. R. Hele
|
|
|
|
|
|
|
|
$ 89,437
|
|
|
|
|
|
|
$ 14,838
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$104,275
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
|
|
$ 85,000
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 85,000
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
|
|
$ 39,383
|
|
|
|
|
|
|
$248,437
|
|
|
|
|
|
|
|
$1,737
|
|
|
|
|
|
|
|
|
|
|
|
$23,585
|
|
|
|
|
|
|
|
|
|
|
|
$359,073
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$672,215
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
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|
|
|
1
|
Each of Mr. Lippert’s and Mr. Goulart’s aggregate amounts of perquisites and other personal benefits in 2016 were less than $10,000 and are therefore reported at $0.
|
Employer Savings and Investment Program and Mandatory Provident Fund
Contributions.
U.S. based eligible employees may make contributions to the Savings and Investment Plan, which is a tax-qualified 401(k) plan. Employer matching contributions are also made to that plan. In
2016, matching contributions to that plan of $
10,600 were made for Mr. Kandarian and Mr. Goulart, and contributions of $7,950 were made for Mr. Hele.
Employer contributions are made to the Auxiliary Savings and Investment Plan due to U.S. Internal Revenue Code limits on the amount of compensation that is eligible for
contributions to the Savings and Investment Plan.
Employer contributions are also made to the Mandatory Provident Fund, in which Mr. Townsend and other
eligible employees in Hong Kong participate. These contributions match contributions made by employees up to limits determined under that fund.
The amount of
contributions for each Named Executive Officer, other than those made to the Savings and Investment Plan, is also reflected in the “Registrant Contributions in Last FY” column of the Nonqualified Deferred Compensation table on
page 86.
Perquisites and Other Personal Benefits.
Goods or services
provided to the Named Executive Officers are perquisites or personal benefits only if they confer a personal benefit on the executive. However, goods or services that are directly and
integrally related to the executive’s job duties, or are offered generally to all employees, or for which the executive fully reimbursed the Company, are not perquisites or personal
benefits. Perquisites and other personal benefits are reported at the Company’s aggregate incremental cost. The following describes each type of perquisite or other personal benefit.
Personal Car Service
. The Company used its own vehicles to provide limited personal travel, incurring the cost of tolls, fuel, and driver overtime
compensation reported in the table above.
Personal Company Aircraft Use.
The reported amounts include the variable costs for personal use of aircraft
that were charged to the Company by the vendor that operates the Company’s leased aircraft for trip-related crew hotels and meals, landing and ground handling fees, hangar and parking costs, in-flight catering and telephone usage, and similar
items. Fuel costs were calculated based on average fuel cost per flight hour for each hour of personal use. Because the aircraft is leased primarily for business use, fixed costs such as lease payments are not included in these amounts. The Company
does not require the Chief Executive Officer to use the Company’s aircraft for all personal and business travel.
Personal Conference, Event, and
Travel.
The reported amounts include the costs incurred by the Company for personal items for the Named Executive Officer at a Company business conference
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
76
|
Summary Compensation Table
or meeting, at MetLife Stadium or at other events, and for personal guests of the Named Executive Officer at such events. Costs paid to a vendor to make personal travel reservations for the Named
Executive Officers or their family members, and the cost of corporate credit card fees, are also included.
Overseas Assignment Benefits.
The Company
provided Mr. Townsend, in connection with his assignment in Hong Kong, $114,933 in housing and $99,896 in subsidy of children’s education. The Company also provided Mr. Townsend personal tax return preparation services at a cost of
$25,736. The Company’s incremental costs to provide these items are included in the table above.
Life and Health Insurance Above Standard Formula.
Employees in Hong Kong, including Mr. Townsend, are provided life and health insurance at levels that vary based on position. The cost of providing such coverage to Mr. Townsend in 2016 is reported in the table above.
Tax Equalization Benefits.
The Company will pay any income taxes
Mr. Townsend owes as a result of 2016 travel on Company business in excess of what he would have owed had he provided the services in his home jurisdiction. The amount reported in the table above is an estimate of such taxes, as
Mr. Townsend‘s precise liability has not yet been determined. The estimate is based on extensive travel to multiple jurisdictions in furtherance of MetLife’s business. For further information, see “Business Travel Income Tax
Equalization” on page 66.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
77
|
Grants of Plan-Based Awards in 2016
Grants of Plan-Based Awards in 2016
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Name
|
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|
|
Grant Date
|
|
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|
|
|
Estimated
Possible
Payouts Under
Non-Equity
Incentive Plan
Awards
Maximum
($)
|
|
|
|
|
|
|
|
|
Estimated Future Payouts Under
Equity Incentive Plan Awards
|
|
|
|
|
|
|
|
|
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(#)
|
|
|
|
|
|
|
|
|
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)
|
|
|
|
|
|
|
Exercise
or Base
Price of
Options
($/Sh)
|
|
|
|
|
Grant Date
Fair Value of
Stock and
Option Awards
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Threshold
(#)
|
|
|
|
|
|
|
|
|
Target
(#)
|
|
|
|
|
|
|
|
|
Maximum
(#)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
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|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$10,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kandarian
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
34,162
|
|
|
|
|
|
|
|
|
|
|
|
136,648
|
|
|
|
|
|
|
|
|
|
|
|
239,134
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$4,583,174
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
68,324
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$2,291,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
204,919
|
|
|
|
|
|
|
|
|
|
|
|
$38.42
|
|
|
|
|
|
|
|
|
|
|
|
$1,897,550
|
|
|
|
|
|
|
John C. R.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$10,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
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|
|
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|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hele
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,761
|
|
|
|
|
|
|
|
|
|
|
|
39,043
|
|
|
|
|
|
|
|
|
|
|
|
68,325
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,309,502
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,522
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 654,768
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
58,549
|
|
|
|
|
|
|
|
|
|
|
|
$38.42
|
|
|
|
|
|
|
|
|
|
|
|
$ 542,164
|
|
|
|
|
|
|
Martin J.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$10,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lippert
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,110
|
|
|
|
|
|
|
|
|
|
|
|
36,440
|
|
|
|
|
|
|
|
|
|
|
|
63,770
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,222,198
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,220
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 611,099
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
54,645
|
|
|
|
|
|
|
|
|
|
|
|
$38.42
|
|
|
|
|
|
|
|
|
|
|
|
$ 506,013
|
|
|
|
|
|
|
Steven J.
Goulart
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$10,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,134
|
|
|
|
|
|
|
|
|
|
|
|
32,536
|
|
|
|
|
|
|
|
|
|
|
|
56,938
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,091,257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,268
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 545,629
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
48,791
|
|
|
|
|
|
|
|
|
|
|
|
$38.42
|
|
|
|
|
|
|
|
|
|
|
|
$ 451,805
|
|
|
|
|
|
|
Christopher
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$10,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
G. Townsend
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,857
|
|
|
|
|
|
|
|
|
|
|
|
23,426
|
|
|
|
|
|
|
|
|
|
|
|
40,995
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 785,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11,713
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 392,854
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 23, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
35,129
|
|
|
|
|
|
|
|
|
|
|
|
$38.42
|
|
|
|
|
|
|
|
|
|
|
|
$ 325,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity Incentive Plan Awards
In February, 2016, the Compensation Committee made each Named Executive Officer eligible for an AVIP award for 2016 performance of up to $10 million, if the Company
attained either of two Section 162(m) performance goals in 2016. Those goals were: (1) positive income from continuing operations before provision for income tax, excluding net investment gains (losses) (defined in accordance with
Section 3(a) of Article 7.04 of SEC Regulation S-X), which includes total net investment gains (losses) and net derivatives gains (losses); or (2) positive TSR. These goals were established for the purpose of making AVIP awards to certain
of the Company’s executives for 2016 eligible for the “performance-based” exemption from the limits on tax deductibility under Section 162(m). This limit is labeled “maximum” in this table. No amounts were established
as minimum or target awards.
The amounts of the 2016 AVIP awards paid to the Named Executive Officers are reflected in the “Non-Equity Incentive
Plan Compensation” column of the Summary Compensation Table on page 72 and further described in the text accompanying that table. The factors and analysis of results considered by the Compensation Committee in determining the 2016 AVIP
awards are discussed in the Compensation Discussion and Analysis.
Equity Incentive Plan Awards
The amounts in these columns reflect a range of Shares the Company may deliver for Performance Shares, or Share equivalents it may pay in cash for
Performance
Units
, granted to each Named Executive Officer in 2016. In each case, it is also possible that no Shares will be delivered or cash paid.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
78
|
Grants of Plan-Based Awards in 2016
If the 25% threshold performance factor in the metrics approved by the Compensation Committee applies, each Named
Executive Officer would receive the number of Performance Shares or Performance Units reflected in the Threshold column of this table. If the target performance factor applies, each Named Executive Officer would receive the number of Performance
Shares or Performance Units reflected in the Target column of the table. The maximum performance factor of 175% is reflected in the Maximum column of the table, rounded down to the nearest whole Share (or Share equivalent).
For a more detailed description of the material terms and conditions of these awards, see the Summary Compensation Table on page 72 and the text accompanying that
table.
All Other Stock Awards
The
amounts in these columns reflect the potential number of Shares the Company may deliver for Restricted Stock Units, or cash it may pay for
Restricted Units
,
granted to each Named Executive Officer in 2016. In each case, it is
also possible that no Shares will be delivered or cash paid.
For a more detailed description of the material terms and conditions of these awards, see the Summary
Compensation Table on page 72 and the text accompanying that table.
All Other Option Awards
For a description of the material terms and conditions of these awards, see the Summary Compensation Table on page 72 and the text accompanying that table.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
79
|
Outstanding Equity Awards at 2016 Fiscal Year-End
Outstanding Equity Awards at 2016 Fiscal
Year-End
This table presents information about:
|
•
|
|
Stock Options granted to the Named Executive Officers that were outstanding on December 31, 2016 because they had not been exercised or forfeited as of that date.
|
|
•
|
|
Performance Shares and Performance Units
granted to the Named Executive Officers that were outstanding on December 31, 2016 because they had not vested as of that date.
|
|
•
|
|
Restricted Stock Units
and Restricted Units
granted to the Named Executive Officers that were outstanding on December 31, 2016 because they had not vested as of that date.
|
The awards reported in this table include awards granted in 2016, which are also reported in the Summary Compensation Table on page 72 and the table entitled
“Grants of Plan-Based Awards in 2016” on page 78.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option
Awards(1)(2)(3)
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
|
|
Option
Exercise
Price
($)
|
|
|
Option
Expiration
Date
|
|
|
Number of
Shares or
Units of
Stock That
Have Not
Vested(4)
(#)
|
|
|
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested(5)
($)
|
|
|
Equity Incentive
Plan Awards:
Number of
Unearned Shares,
Units or Other
Rights That Have
Not Vested(6)
(#)
|
|
|
Equity Incentive
Plan Awards:
Market or Payout
Value of Unearned
Shares, Units or
Other Rights
That Have Not
Vested(7)
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A.
Kandarian
|
|
|
45,000
|
|
|
|
0
|
|
|
$
|
62.80
|
|
|
|
February 26, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
43,500
|
|
|
|
0
|
|
|
$
|
60.51
|
|
|
|
February 25, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
53,400
|
|
|
|
0
|
|
|
$
|
23.30
|
|
|
|
February 23, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
106,800
|
|
|
|
0
|
|
|
$
|
23.30
|
|
|
|
February 23, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
76,000
|
|
|
|
0
|
|
|
$
|
34.84
|
|
|
|
February 22, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
80,000
|
|
|
|
0
|
|
|
$
|
45.79
|
|
|
|
February 22, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
150,000
|
|
|
|
0
|
|
|
$
|
44.59
|
|
|
|
March 20, 2021
|
|
|
|
|
|
|
|
|
|
|
|
409,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
328,125
|
|
|
|
0
|
|
|
$
|
38.29
|
|
|
|
February 27, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
181,818
|
|
|
|
0
|
|
|
$
|
34.86
|
|
|
|
February 25, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
87,000
|
|
|
|
43,500
|
|
|
$
|
50.53
|
|
|
|
February 24, 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
48,647
|
|
|
|
97,296
|
|
|
$
|
51.39
|
|
|
|
February 23, 2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
204,919
|
|
|
$
|
38.42
|
|
|
|
February 22, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
115,256
|
|
|
|
$6,211,146
|
|
|
|
|
|
|
|
$22,062,566
|
|
|
|
|
|
|
John C.R.
Hele
|
|
|
98,383
|
|
|
|
0
|
|
|
$
|
34.00
|
|
|
|
September 3, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,182
|
|
|
|
0
|
|
|
$
|
34.86
|
|
|
|
February 25, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26,994
|
|
|
|
13,498
|
|
|
$
|
50.53
|
|
|
|
February 24, 2024
|
|
|
|
|
|
|
|
|
|
|
|
119,405
|
|
|
|
|
|
|
|
|
|
|
|
|
14,594
|
|
|
|
29,189
|
|
|
$
|
51.39
|
|
|
|
February 23, 2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
58,549
|
|
|
$
|
38.42
|
|
|
|
February 22, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,752
|
|
|
|
$1,818,895
|
|
|
|
|
|
|
|
$6,434,735
|
|
|
|
|
|
|
Martin J.
|
|
|
37,500
|
|
|
|
0
|
|
|
$
|
29.50
|
|
|
|
September 5, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lippert
|
|
|
32,800
|
|
|
|
0
|
|
|
$
|
38.29
|
|
|
|
February 27, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
54,545
|
|
|
|
0
|
|
|
$
|
34.86
|
|
|
|
February 25, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,995
|
|
|
|
12,498
|
|
|
$
|
50.53
|
|
|
|
February 24, 2024
|
|
|
|
|
|
|
|
|
|
|
|
109,742
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,135
|
|
|
|
26,270
|
|
|
$
|
51.39
|
|
|
|
February 23, 2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
54,645
|
|
|
$
|
38.42
|
|
|
|
February 22, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31,144
|
|
|
|
$1,678,350
|
|
|
|
|
|
|
|
$5,913,996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
80
|
Outstanding Equity Awards at 2016 Fiscal Year-End
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option
Awards(1)(2)(3)
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
|
|
Option
Exercise
Price
($)
|
|
|
Option
Expiration
Date
|
|
|
Number of
Shares or
Units of
Stock That
Have Not
Vested(4)
(#)
|
|
|
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested(5)
($)
|
|
|
Equity Incentive
Plan Awards:
Number of
Unearned Shares,
Units or Other
Rights That Have
Not Vested(6)
(#)
|
|
|
Equity Incentive
Plan Awards:
Market or Payout
Value of Unearned
Shares, Units or
Other Rights
That Have Not
Vested(7)
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven
J.
Goulart
|
|
|
10,500
|
|
|
|
0
|
|
|
$
|
62.80
|
|
|
|
February 26, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,500
|
|
|
|
0
|
|
|
$
|
60.51
|
|
|
|
February 25, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,000
|
|
|
|
0
|
|
|
$
|
23.30
|
|
|
|
February 23, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,100
|
|
|
|
0
|
|
|
$
|
34.84
|
|
|
|
February 22, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,300
|
|
|
|
0
|
|
|
$
|
45.79
|
|
|
|
February 22, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
70,300
|
|
|
|
0
|
|
|
$
|
38.29
|
|
|
|
February 27, 2022
|
|
|
|
|
|
|
|
|
|
|
|
90,991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,364
|
|
|
|
0
|
|
|
$
|
34.86
|
|
|
|
February 25, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,996
|
|
|
|
7,999
|
|
|
$
|
50.53
|
|
|
|
February 24, 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,729
|
|
|
|
19,460
|
|
|
$
|
51.39
|
|
|
|
February 23, 2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
48,791
|
|
|
$
|
38.42
|
|
|
|
February 22, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,422
|
|
|
|
$1,369,992
|
|
|
|
|
|
|
|
$4,903,505
|
|
|
|
|
|
|
Christopher G.
Townsend
|
|
|
44,365
|
|
|
|
0
|
|
|
$
|
30.43
|
|
|
|
July 31, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,545
|
|
|
|
0
|
|
|
$
|
34.86
|
|
|
|
February 25, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,997
|
|
|
|
7,499
|
|
|
$
|
50.53
|
|
|
|
February 24, 2024
|
|
|
|
|
|
|
|
|
|
|
|
68,237
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,783
|
|
|
|
15,568
|
|
|
$
|
51.39
|
|
|
|
February 23, 2025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
35,129
|
|
|
$
|
38.42
|
|
|
|
February 22, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,403
|
|
|
|
$1,045,628
|
|
|
|
|
|
|
|
$3,677,292
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Each of these Option Awards is a Stock Option. Each has an expiration date that is the day before the tenth anniversary of its grant date.
Except as described in note 2 to this table, each of the
Stock Options for each Named Executive Officer will become exercisable at a rate of one-third of each annual grant on each of the first three anniversaries of the grant date, subject to conditions
.
|
|
2
|
Mr. Kandarian’s Stock Options that expire on March 20, 2021, and 106,800 of Mr. Kandarian’s Stock Options that expire on February 23, 2019, became exercisable on the third anniversary of their
grant date, subject to conditions.
|
|
3
|
Portions of Mr. Kandarian’s outstanding Stock Options have been effectively transferred other than for value under a
|
|
|
domestic relations order: 19,125 of those expiring in 2017 and 11,310 of those expiring in 2018.
|
|
4
|
Each of these Stock Awards is comprised of Restricted Stock Units, except for Mr. Townsend’s Stock Awards, which are Restricted Units.
|
|
5
|
The hypothetical amount reflected in this column for each Named Executive Officer is equal to the number of Restricted Stock Units and Restricted Units reflected in the column entitled “Number of Shares or Units of
Stock That Have Not Vested” multiplied by the closing price of a Share on December 31, 2016, the last business day of that year.
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
81
|
Outstanding Equity Awards at 2016 Fiscal Year-End
|
6
|
Each of these Stock Awards is comprised of Performance Shares, except for Mr. Townsend’s Stock Awards which are Performance Units. The number of Stock Awards reported is the maximum number of Shares that the
Company could deliver (or pay the equivalent in cash) for the following performance periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maximum Performance
Shares or Performance
Units
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
2015-2017
|
|
|
|
|
|
|
|
|
2016-2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A. Kandarian
|
|
|
|
|
|
|
|
|
170,266
|
|
|
|
|
|
|
|
|
|
|
|
239,134
|
|
|
|
|
|
|
John C.R. Hele
|
|
|
|
|
|
|
|
|
51,080
|
|
|
|
|
|
|
|
|
|
|
|
68,325
|
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
|
|
|
45,972
|
|
|
|
|
|
|
|
|
|
|
|
63,770
|
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
|
|
|
34,053
|
|
|
|
|
|
|
|
|
|
|
|
56,938
|
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
|
|
|
27,242
|
|
|
|
|
|
|
|
|
|
|
|
40,995
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company has not yet delivered any Shares or paid any cash for these Performance Shares and Performance Units. The number of Shares the Company delivers or cash it pays may be lower than the amounts reflected in this
table. Under the terms of the awards, the number of Shares the Company delivers, or cash it pays, if any, will depend on a performance factor that the Compensation Committee determines based upon a three-year performance period. The maximum
performance factor has been used to report these outstanding awards because it was not possible to determine the Company’s performance in 2017 or 2018 at the time this Proxy Statement was filed. See the Summary Compensation Table on
page 72 for a description of the terms of the Performance Share
and Performance Unit
awards.
|
|
7
|
The hypothetical amount reflected in this column for each Named Executive Officer is equal to the number of Performance Shares
and Performance Units
reflected in the column entitled “Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested” multiplied by the closing price of a Share on December 31, 2016, the last business day of that year.
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
82
|
Option Exercises and Stock Vested in 2016
Option Exercises and Stock Vested in 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
Number of Shares
Acquired on Vesting
(#)
|
|
|
|
|
|
|
|
Value Realized
on Vesting
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A.
Kandarian
|
|
|
|
89,546
|
|
|
|
|
|
|
|
|
|
$4,088,440
|
|
|
|
|
|
John C.R. Hele
|
|
|
|
23,373
|
|
|
|
|
|
|
|
|
|
$1,092,001
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
25,706
|
|
|
|
|
|
|
|
|
|
$1,174,243
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
17,055
|
|
|
|
|
|
|
|
|
|
$ 775,022
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
15,037
|
|
|
|
|
|
|
|
|
|
$ 689,097
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Awards
Restricted Stock Units and Restricted Units.
These amounts include Shares the Company delivered for Restricted Stock Units, or equivalent in cash it paid for Restricted Units, that vested in
2016. The value realized on vesting was determined using the closing price of a Share on the vesting date. None of the Named Executive Officers had the opportunity to defer the Shares that they might receive for these awards.
2014-2016 Performance Shares and Performance Units.
These amounts also include Shares deliverable for Performance Shares, or equivalent in cash payable for Performance Units, for the 2014-2016 performance period, which vested on December 31, 2016. The value
realized on vesting was determined using the number of Shares deliverable, or Share equivalent payable in
cash, multiplied by the closing price of Shares on the vesting date. The number of Shares deliverable for this award (or cash equivalent) was calculated by
multiplying the number of Performance Shares by the performance factor that pertained to the awards, which was 44.4%. For more information, see pages 53.
Each Named Executive Officer who had a Performance Share award for the 2014-2016 performance period had the opportunity to defer Shares deliverable for that award. None
of them chose to defer any of those Shares.
Option Awards
None of the
Named Executive Officers exercised any Option Awards in 2016.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
83
|
Pension Benefits at 2016 Fiscal Year-End
Pension Benefits at 2016 Fiscal Year-End
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name(1)
|
|
|
|
|
|
|
|
Plan
Name
|
|
|
|
|
|
|
|
Number of Years
Credited Service
(#)
|
|
|
|
|
|
|
|
|
|
|
|
Present Value of
Accumulated Benefit
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A. Kandarian
|
|
|
|
|
|
|
|
Retirement Plan
|
|
|
|
|
|
|
|
11.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 207,050
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary Pension Plan
|
|
|
|
|
|
|
|
11.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$3,698,510
|
|
|
|
|
|
|
|
John C. R. Hele
|
|
|
|
|
|
|
|
Retirement Plan
|
|
|
|
|
|
|
|
4.333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 75,074
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary Pension Plan
|
|
|
|
|
|
|
|
4.333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 758,776
|
|
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
|
|
Retirement Plan
|
|
|
|
|
|
|
|
5.333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 97,878
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary Pension Plan
|
|
|
|
|
|
|
|
5.333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 976,395
|
|
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
|
|
Retirement Plan
|
|
|
|
|
|
|
|
10.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ 219,856
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary Pension Plan
|
|
|
|
|
|
|
|
10.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,065,953
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Mr. Townsend did not participate in a defined benefit pension plan in 2016.
|
The U.S.-based Named Executive Officers are eligible to participate in the Retirement Plan and the Auxiliary Pension Plan.
Eligible employees qualify for pension benefits after one year of service and become vested in their benefits after three years of service. The discussion below relates to those benefits.
Pension Plans
Pension benefits are
paid under two separate plans, primarily due to tax requirements. The Retirement Plan is a tax-qualified defined benefit pension plan that provides benefits for eligible employees on the United States payroll. The U.S. Internal Revenue Code
imposes limitations on eligible compensation and on the amounts that can be paid under the Retirement Plan. The purpose of the Auxiliary Pension Plan is to provide benefits which eligible employees would have received under the Retirement Plan if
these limitations were not imposed. Benefits under the Auxiliary Pension Plan are calculated in substantially the same manner as they are under the Retirement Plan. The Auxiliary Pension Plan is unfunded, and benefits under that plan are general
promises of payment not secured by any rights to Company property.
Determination of Benefits
Each U.S.-based Named Executive Officer’s benefit will be determined under the
Personal Retirement Account
Formula
, which is based on monthly contributions for each employee based on the employee’s compensation, plus interest.
This formula is the standard formula that applies to all similarly-situated employees.
Each of the U.S.-based NEO’s had sufficient service as of year-end 2016 to be fully vested in
his Personal Retirement Account Formula benefit.
Under the Personal Retirement Account Formula, an employee is credited each month with an amount equal to five
percent of eligible compensation up to the Social Security wage base (for 2016, $118,500), plus 10% of eligible compensation in excess of that wage base. Eligible compensation includes base salary and eligible annual incentive awards. In addition,
amounts credited to each employee earn interest at an approximation of the U.S. government’s 30-year Treasury securities rate.
For pension benefit purposes,
the 2009 annual incentive awards, which were paid outside of AVIP, are considered on the same basis as AVIP awards.
Form and
Timing of Payment of Benefits
An employee may choose to receive vested Personal Retirement Account Formula
benefits from the Retirement Plan as a single lump-sum payment or as one of several forms of annuity at termination of employment or deferred until no later than age 65. Amounts accrued under the Auxiliary Pension Plan that are determined by the
Personal Retirement Account Formula are paid in a lump sum at termination of employment, subject to any delays under Code Section 409A.
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|
|
|
|
|
2017 Proxy Statement
|
|
84
|
Pension Benefits at 2016 Fiscal Year-End
Retirement Eligibility
Normal Retirement Eligibility applies at age 65 with at least one year of service. An employee is eligible for early Retirement Eligibility beginning at age 55 with 15
years of service. Each year of age over age 57 1/2 reduces the number of years of service required to qualify for early retirement, until normal Retirement Eligibility at age 65 and at least one year of service.
However, attaining Retirement Eligibility does not affect Personal Retirement Account benefits. Personal Retirement Account participants qualify to be paid their full
vested benefit when their employment ends. Because Personal Retirement Account benefits are based on total amounts credited for the employee and not final average compensation, those benefits are not reduced for any early retirement.
Attaining Retirement Eligibility does effect whether an employee retains stock-based long-term incentive awards granted in 2014 or earlier. See the text accompanying
the table entitled “Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End” on page 91 for a discussion of these effects as of 2016 year-end.
Of the Named Executive Officers based in the U.S.,
only
Mr. Kandarian was Retirement Eligible during 2016.
Code Section 409A Requirements
Personal Retirement Account balances in the Auxiliary Pension Plan are subject to the requirements of U.S. Internal Revenue Code Section 409A
(Section 409A)
.
Participants had the opportunity in 2008 to choose their form of payment (including a lump sum or annuity) for their accrued benefit, so long as they did not begin receiving payments in the year of the election. Payments of amounts that are subject
to the requirements of Section 409A to the top 50 highest paid officers in the Company that are due upon separation from service are delayed for six months following their separation, as required by Section 409A.
Present Value Calculation Assumptions
The present value of each
Named Executive Officer participant’s accumulated pension benefits is reported in the table above using certain assumptions.
The present value of each Named
Executive Officer’s benefit as of December 31, 2016 is equal to his Personal Retirement Account balance. Each U.S.-based NEO was vested in such benefit as of that date.
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|
2017 Proxy Statement
|
|
85
|
Nonqualified Deferred Compensation at 2016 Fiscal Year-End
Nonqualified Deferred Compensation at 2016
Fiscal Year-End
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Name(1)
|
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|
|
Plan Name
|
|
|
|
|
|
Executive
Contributions
in Last FY(2)
($)
|
|
|
|
|
|
Registrant
Contributions
in Last FY(3)
($)
|
|
|
|
|
|
Aggregate
Earnings
in Last FY(4)
($)
|
|
|
|
|
|
Aggregate
Withdrawals/
Distributions
($)
|
|
|
|
|
|
Aggregate
Balance at
Last FYE(5)
($)
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Steven A. Kandarian
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leadership Plan
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,003,552
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
7,422,948
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary SIP
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
230,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
42,944
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,486,745
|
|
|
|
|
|
|
|
John C. R. Hele
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary SIP
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
81,487
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
14,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
236,752
|
|
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leadership Plan
Auxiliary SIP
|
|
|
|
|
|
|
|
|
|
|
|
|
$
$
|
0
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
$
|
0
74,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
$
|
16,266
48,196
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
$
|
51,763
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
$
|
118,062
514,190
|
|
|
|
|
|
|
|
Christopher G.
Townsend
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mandatory
Provident Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
2,320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
39,383
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
2,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
155,128
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
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1
|
Mr. Lippert did not participate in a nonqualified deferred compensation plan in 2016.
|
|
2
|
The amount in this column for Mr. Townsend reflects salary payments that were credited as contributions to the Mandatory Provident Fund. These amounts were reported as salary in the Summary Compensation
Table for 2016. No employee contributions are made under the Auxiliary SIP.
|
|
3
|
Amounts in this column are reported as components of Employer Savings and Investment Program
and Mandatory Provident Fund
Contributions for 2016 in the “All Other Compensation” column of the
Summary Compensation Table on page 72.
|
|
4
|
None of the amounts in this column are reported for 2016 in the Summary Compensation Table. See the text pertaining to the “Change in Pension Value and Nonqualified Deferred Compensation Earnings”
column of that table beginning on page 72. The amount in this column for Mr. Townsend includes the effect of the change in foreign currency exchange rate from Hong Kong dollars to United States dollars used for this table (U.S.$1 = H.K.$7.759)
compared to that used for the same table in the Company’s 2016 Proxy Statement (U.S.$1 = H.K. $7.765).
|
|
5
|
A portion of the amounts reported in this column is attributable to Employer Savings and Investment Program
and
|
|
|
Mandatory Provident Fund
Contributions. These contributions are reflected in the “All Other Compensation” column of the Summary Compensation Tables in the Company’s previous
Proxy Statements (beginning in 2007) for Named Executive Officers who appeared in those Proxy Statements: $1,197,917 for Mr. Kandarian, $155,062 for Mr. Hele, $123,067 for Mr. Goulart, and $97,709 for Mr. Townsend.
|
Deferred Compensation Program for U.S.-Based Employees
The Company’s nonqualified deferred compensation program offers savings opportunities to the U.S.-based Named Executive Officers, as well as hundreds of other
eligible employees.
The program for U.S.-based employees includes the MetLife Leadership Deferred Compensation Plan, or
Leadership Plan
. Under the
Leadership Plan, employees may elect to defer receipt of their base salary and incentive compensation. Income taxation on such compensation is delayed until the employee receives payment. Amounts deferred under the Leadership Plan are subject to the
requirements of Section 409A.
Employees may also receive Company contributions under the Auxiliary Savings and Investment Plan. In the table above, the Auxiliary
Savings and Investment Plan is referred to as the
Auxiliary SIP
.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
86
|
Nonqualified Deferred Compensation at 2016 Fiscal Year-End
Leadership Plan.
Under the
Leadership Plan, Named Executive Officers based in the U.S. may elect to defer receipt of up to 75% of their base salary, all of their AVIP awards, and any Shares deliverable for Performance Share awards. These deferrals are voluntary contributions
of the Named Executive Officers’ own earnings.
Compensation that would have been made in Shares, but is deferred, remains deliverable in Shares. This
includes Shares deliverable for Performance Shares, Restricted Stock Units, and the Shares deliverable under the Long Term Performance Compensation Plan formerly maintained by the Company. Cash awards under the Long Term Performance Compensation
Plan that were irrevocably deferred in the form of Shares are also delivered in Shares. All other deferred compensation is payable in cash.
Participants may elect
to receive compensation they have deferred at a specified date before, upon or after retirement. In addition, participants may elect to receive payments in a single lump sum or in up to 15 annual installments. However, MetLife pays out the deferred
compensation in a single lump sum when the employee leaves MetLife, except under certain circumstances. With respect to compensation that would otherwise have been paid in 2014 and earlier but is instead deferred, the employee’s choice of form
and timing of payment is honored if the employee becomes Retirement Eligible or
Bridge
Eligible
(meet the requirements for age and service and have a final separation agreement under a particular severance plan, making the employee
eligible for post-retirement medical benefits despite not being Retirement Eligible). With respect to compensation that would have been paid in 2015 or later but was instead deferred, the employee’s choice of form and timing of payment is
honored if the employee has completed five or more years of service or is at least age 60 when employment ends. Payments to the top 50 highest paid officers that are due upon separation from service are delayed for six months following their
separation, in compliance with Section 409A.
The Company offers a number of simulated investments under the Leadership Plan. Participants may generally choose
the simulated investments for their deferred cash compensation at the time they elect to defer compensation, and may change the simulated investment selections for their existing account balances up to six times each calendar year.
The rate set for the Auxiliary Fixed Income Fund cannot exceed 120% of the applicable federal long term rate under U.S. Internal Revenue Code Section 1274(d) at the time that rate is set.
The MetLife Deferred Shares Fund is available exclusively for compensation payable in Shares that the employee has deferred (
Deferred Shares
). The MetLife Common
Stock Fund is available for deferred cash compensation. Each of these two funds reflects changes in value of Shares plus the value of imputed reinvested dividends.
The following table reflects the simulated investment returns for 2016 on each of the alternatives offered under the Leadership Plan.
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Simulated Investment
|
|
|
|
|
|
|
|
2016 Returns
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary Fixed Income
Fund
|
|
|
|
|
|
|
|
3.13%
|
|
|
|
|
|
Lord Abbett Bond Debenture
Fund
|
|
|
|
|
|
|
|
(3.28)%
|
|
|
|
|
|
Western Asset Management Strategic
Bond Opportunities
|
|
|
|
|
|
|
|
8.55%
|
|
|
|
|
|
Oakmark Fund
|
|
|
|
|
|
|
|
18.35%
|
|
|
|
|
|
Small Cap Equity
Fund
|
|
|
|
|
|
|
|
16.82%
|
|
|
|
|
|
Oakmark International
Fund
|
|
|
|
|
|
|
|
7.91%
|
|
|
|
|
|
S&P 500
©
Index
|
|
|
|
|
|
|
|
11.96%
|
|
|
|
|
|
Russell 2000
©
Index
|
|
|
|
|
|
|
|
21.31%
|
|
|
|
|
|
MSCI EAFE
©
Index
|
|
|
|
|
|
|
|
1.00%
|
|
|
|
|
|
Barclays U.S. Aggregate Bond
Index
|
|
|
|
|
|
|
|
2.65%
|
|
|
|
|
|
BofA Merrill Lynch U.S. High Yield
Index
|
|
|
|
|
|
|
|
17.49%
|
|
|
|
|
|
MSCI Emerging Markets
Index
|
|
|
|
|
|
|
|
11.19%
|
|
|
|
|
|
MetLife Deferred Shares
Fund
|
|
|
|
|
|
|
|
15.63%
|
|
|
|
|
|
MetLife Common Stock
Fund
|
|
|
|
|
|
|
|
15.63%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Lord Abbett Bond Debenture Fund was available as a simulated investment through April 29, 2016, and the table above reports the
return for that period. Simulated investments in that fund as of that date were transferred to the Western Asset Management Strategic Bond Opportunities fund, unless and until a participant changed the simulated investment for those deferrals.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
87
|
Nonqualified Deferred Compensation at 2016 Fiscal Year-End
Auxiliary Savings and Investment
Plan.
Eligible U.S.-based Named Executive Officers and other eligible U.S.-based employees who elected to contribute a portion of their eligible compensation under the tax-qualified Savings and Investment Plan
in 2016 received a Company contribution of their eligible compensation in that plan in 2016:
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|
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|
|
|
|
|
|
Employee
Contribution
(as a percentage of eligible
compensation)
|
|
|
|
|
|
Company Contribution
(as a percentage of eligible
compensation)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3%
|
|
|
|
|
|
3.0%
|
|
|
|
|
|
4%
|
|
|
|
|
|
3.5%
|
|
|
|
|
|
5% or more
|
|
|
|
|
|
4.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The employee’s eligible compensation under the Savings and Investment Plan includes base salary and eligible annual incentive
awards.
The U.S. Internal Revenue Code limits compensation that is eligible for employer contributions under the Savings and Investment Plan. In 2016, the Company
could not make contributions based on compensation over $265,000. Named Executive Officers and other eligible employees who elected to participate in the Savings and Investment Plan during 2016 were credited with a percentage of their eligible
compensation beyond that limit. The Company contribution was determined using the same employee contribution rate as applied under the Savings and Investment Plan. This Company contribution is credited to an account established for the employee
under the nonqualified Auxiliary Savings and Investment Plan.
If the employee makes no election otherwise, Auxiliary Savings and Investment Plan balances are paid
in a lump sum one year after termination of employment. Employees can elect to receive their Auxiliary Savings and Investment Plan balances in up to 15
annual installments and/or may elect to delay their payment, or the beginning of their annual payments, for up to 10 years after termination of employment.
Amounts in the Auxiliary Savings and Investment Plan are subject to the requirements of Section 409A. Participants were able to elect the time and form of their
payments through 2008, which was within the time period permitted for such elections under Section 409A. Participants may change the time and form of their payments after 2008, but the election must be made during employment, is not effective
until 12 months after it is made, and must delay the start of benefit payments by at least five years. Payments to the top 50 highest paid officers that are due upon separation from service are delayed for six months following their separation, in
compliance with Section 409A.
Employees may choose from a number of simulated investments for their Auxiliary Savings and Investment Plan accounts. These
simulated investments were identical to the core funds offered under the Savings and Investment Plan in 2016, except that the rate set for the Auxiliary Fixed Income Fund available under the Auxiliary Savings and Investment Plan cannot exceed 120%
of the applicable federal long term rate under U.S. Internal Revenue Code Section 1274(d) at the time that rate is set. Employees may change the simulated investments for new Company contributions to their Auxiliary Savings and Investment Plan
accounts at any time.
Employees could change the simulated investments for their existing Auxiliary Savings and Investment Plan accounts up to four times a month
in 2016. Beginning in 2010, employees could not allocate more than 10% of their existing Auxiliary Savings and Investment Plan account balances to the MetLife Company Stock Fund (except for any account balance already in the MetLife Company Stock
Fund as of January 1, 2010), and could not allocate more than 10% of future contributions to that fund. Fees are charged to employees for moving existing balances out of certain international simulated investments prior to the expiration of
pre-established holding periods.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
88
|
Nonqualified Deferred Compensation at 2016 Fiscal Year-End
The following table reflects the simulated investment returns for 2016 on each of the alternatives offered under the
Auxiliary Savings and Investment Plan.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Simulated Investment
|
|
|
|
|
|
|
|
2016 Returns
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auxiliary Fixed Income
Fund
|
|
|
|
|
|
|
|
3.13%
|
|
|
|
|
|
Bond Index Fund
|
|
|
|
|
|
|
|
2.50%
|
|
|
|
|
|
Balanced Index
Fund
|
|
|
|
|
|
|
|
7.26%
|
|
|
|
|
|
Large Cap Equity Index Fund
|
|
|
|
|
|
|
|
11.88%
|
|
|
|
|
|
Large Cap Value Index
Fund
|
|
|
|
|
|
|
|
17.20%
|
|
|
|
|
|
Large Cap Growth Index Fund
|
|
|
|
|
|
|
|
6.99%
|
|
|
|
|
|
Mid Cap Equity Index
Fund
|
|
|
|
|
|
|
|
20.62%
|
|
|
|
|
|
Small Cap Equity
Fund
|
|
|
|
|
|
|
|
16.82%
|
|
|
|
|
|
International Equity
Fund
|
|
|
|
|
|
|
|
5.63%
|
|
|
|
|
|
MetLife Company Stock Fund
|
|
|
|
|
|
|
|
15.53%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The MetLife Company Stock Fund includes a limited proportion of simulated investments in instruments other than Shares.
Each simulated investment was available for the entirety of 2016.
Mandatory
Provident Fund Applicable to Mr. Townsend
Under the Mandatory Provident Fund available to employees in Hong Kong, including Mr. Townsend, eligible
employees must defer five percent of their salary and other compensation, subject
to a monthly limit. The monthly employer contribution is based on the employee’s years of service: six percent of salary if the employee has less than five years of service, eight percent of
salary if the employee has between five and 10 years of service, 10% of salary if the employee has between 10 and 15 years of service, and 12% of salary if the employee has 15 or more years of service. An employee may make additional, voluntary
contributions of between one and five percent of monthly salary. If the employee does so, the employer must make additional matching contributions equal to the employee’s contributions up to two percent of monthly salary.
The matching contribution vests at 10% per year of completed service and is completely vested at ten years of service. An employee who is dismissed due to fraud,
dishonesty, or gross misconduct (or resigns to avoid such a dismissal) may forfeit the employer’s voluntary contributions.
Payments of the employee and
mandatory employer contributions are generally made in a single lump sum at age 65 or when the employee leaves employment after age 60. If an employee leaves employment before age 60, the employee’s mandatory contributions, and the mandatory
contributions the employer made to match those contributions, generally remain in the program and may be transferred to another employer’s Mandatory Provident Fund. When an employee leaves employment, regardless of age, the employee receives
the employee’s voluntary contributions and the vested voluntary contributions the employer made to match those contributions.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
89
|
Nonqualified Deferred Compensation at 2016 Fiscal Year-End
The program offers a number of funds from among which participants may choose to invest some or all of their accounts.
Participants may generally change the investments for their new contributions at any time. The following table reflects the investment returns for 2016 on each of the funds offered under the program.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constituent Fund
|
|
|
|
|
|
|
|
|
|
|
2016
Returns
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Manulife MPF Japan Equity Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.01%
|
|
|
|
|
|
Manulife MPF North American Equity
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8.07%
|
|
|
|
|
|
Manulife MPF Healthcare Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7.31)%
|
|
|
|
|
|
Manulife MPF International Equity Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.38%
|
|
|
|
|
|
Manulife MPF Hong Kong Bond Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.44)%
|
|
|
|
|
|
Manulife MPF Conservative Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.02%
|
|
|
|
|
|
Manulife MPF Stable Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.11)%
|
|
|
|
|
|
Manulife MPF European Equity Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.91%
|
|
|
|
|
|
Manulife MPF 2035 Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.04%
|
|
|
|
|
|
Manulife MPF 2025 Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.53)%
|
|
|
|
|
|
Manulife MPF 2020 Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.10)%
|
|
|
|
|
|
Manulife MPF 2030 Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.08)%
|
|
|
|
|
|
Manulife MPF 2045 Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.08%
|
|
|
|
|
|
Manulife MPF 2040 Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.04%
|
|
|
|
|
|
Manulife MPF Aggressive
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.32%
|
|
|
|
|
|
Manulife MPF Growth
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.50)%
|
|
|
|
|
|
Manulife MPF Smart Retirement
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.33)%
|
|
|
|
|
|
Manulife MPF Fidelity Growth
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.20%
|
|
|
|
|
|
Manulife MPF Interest
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.01%
|
|
|
|
|
|
Manulife MPF International Bond Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.43%
|
|
|
|
|
|
Manulife MPF Fidelity Stable Growth
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.61%
|
|
|
|
|
|
Manulife MPF Pacific Asia Bond
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.39%
|
|
|
|
|
|
Manulife MPF China Value
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2.60)%
|
|
|
|
|
|
Manulife MPF RMB Bond
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.29)%
|
|
|
|
|
|
Manulife MPF Hang Seng Index Tracking
Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2.26%
|
|
|
|
|
|
Manulife MPF Hong Kong Equity Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.06)%
|
|
|
|
|
|
Manulife MPF Pacific Asia Equity Fund
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.53%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Each investment was available for the entirety of 2016.
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
90
|
Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End
Potential Payments upon Termination
or Change-in-Control at 2016 Fiscal Year-End
The following table reflects estimated additional payments or benefits that would have been earned or
accrued, or that would have vested or been delivered or paid out earlier than normal, had any Named Executive Officer been terminated from employment or had a change-in-control of the Company occurred on the last business day of 2016 (the
Trigger
Date
), and using the closing price of a Share on that date as applicable. The table reflects hypothetical payments and benefits. None of the payments or benefits has actually been made.
The table and accompanying discussion also do not include payments or benefits under arrangements available on the same basis generally to all salaried employees in the
jurisdiction in which the Named Executive Officer is employed. The Named Executive Officers’ pension benefits and nonqualified deferred compensation are described in the tables entitled “Pension Benefits at 2016 Fiscal Year-End” on
page 84 and “Nonqualified Deferred Compensation at 2016 Fiscal Year-End” on page 86, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary
Resignation
|
|
|
|
|
|
Death
|
|
|
|
|
|
Severance-Eligible Termination
(No Change-in-Control)
|
|
|
|
|
|
Change-in-Control
(Assuming No
Alternative Award)
|
|
|
|
|
|
Change-in-Control
Severance Eligible
Termination
|
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
Stock
Options
|
|
|
|
|
|
Delivery
of Shares (or
Cash
Equivalent)
for
Share
Awards
|
|
|
|
|
|
Severance
Pay
|
|
|
|
|
|
Outplace-
ment
|
|
|
|
|
|
Pro-Rata
Delivery
of Shares (or
Payment
of
Cash
Equivalent)
for Share
Awards
|
|
|
|
|
|
Accelerated
Stock
Options
|
|
|
|
|
|
Delivery
of Shares (or
Payment
of
Cash
Equivalent)
for Share
Awards
|
|
|
|
|
|
Severance
Pay
|
|
|
|
|
|
Benefits
Continuation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A.
Kandarian
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0
|
|
|
|
|
|
$3,559,497
|
|
|
|
|
|
$18,036,929
|
|
|
|
|
|
$1,162,500
|
|
|
|
|
|
$16,250
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
$3,559,497
|
|
|
|
|
|
$18,036,929
|
|
|
|
|
|
$12,406,139
|
|
|
|
|
|
$199,404
|
|
|
|
|
|
|
|
John C. R.
Hele
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0
|
|
|
|
|
|
$1,024,079
|
|
|
|
|
|
$ 5,253,413
|
|
|
|
|
|
$ 492,308
|
|
|
|
|
|
$16,250
|
|
|
|
|
|
$1,500,000
|
|
|
|
|
|
$1,024,079
|
|
|
|
|
|
$ 5,253,413
|
|
|
|
|
|
$ 2,819,931
|
|
|
|
|
|
$147,567
|
|
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0
|
|
|
|
|
|
$ 953,026
|
|
|
|
|
|
$ 4,833,232
|
|
|
|
|
|
$ 491,827
|
|
|
|
|
|
$16,250
|
|
|
|
|
|
$1,366,700
|
|
|
|
|
|
$ 953,026
|
|
|
|
|
|
$ 4,833,232
|
|
|
|
|
|
$ 3,076,594
|
|
|
|
|
|
$126,015
|
|
|
|
|
|
|
|
Steven J. Goulart
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0
|
|
|
|
|
|
$ 830,323
|
|
|
|
|
|
$ 4,028,278
|
|
|
|
|
|
$ 548,077
|
|
|
|
|
|
$16,250
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
$ 830,323
|
|
|
|
|
|
$ 4,028,278
|
|
|
|
|
|
$ 3,248,162
|
|
|
|
|
|
$100,909
|
|
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0
|
|
|
|
|
|
$ 607,562
|
|
|
|
|
|
$ 3,012,235
|
|
|
|
|
|
$ 415,385
|
|
|
|
|
|
$ 0
|
|
|
|
|
|
$ 833,300
|
|
|
|
|
|
$ 607,562
|
|
|
|
|
|
$ 3,012,235
|
|
|
|
|
|
$ 2,972,513
|
|
|
|
|
|
$ 83,764
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary Resignation
None of
the Named Executive Officers has a preferential arrangement that calls for any severance pay in connection with a voluntary resignation from employment prior to a change-in-control. Nor in such a case would any additional preferential payments or
benefits have been earned or accrued, or have vested or been delivered or paid out earlier than normal, in favor of any Named Executive Officer. Mr. Townsend would receive payments determined on the same basis as applies to all other employees
in Hong Kong.
A Named Executive Officer who had resigned but was Retirement Eligible (for awards granted in 2014 or earlier) or met the
Rule of 65 (for awards granted in 2015) as of the Trigger Date would have continued to receive the benefit of the executive’s existing stock-based awards. The Company would have delivered Shares for each of the executive’s Performance
Shares, or paid cash for each of the executive’s Performance Units, after the conclusion of the performance period, and would have delivered Shares or paid cash for the executive’s Restricted Stock Units and Restricted Units after the
conclusion of the restriction period, and all of the executive’s unexercised Stock Options would have continued to vest and remain exercisable for
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
91
|
Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End
the remainder of their full ten-year term. These terms apply to all employees who meet the age and service qualifications to become Retirement Eligible and have received such awards. See the
table entitled “Outstanding Equity Awards at 2016 Fiscal Year-End” on page 80 for details on the Performance Shares and Stock Options. Of the Named Executive Officers only Mr. Kandarian was Retirement Eligible as of the Trigger
Date, and only Mr. Kandarian and Mr. Goulart met the Rule of 65 as of the Trigger Date.
An executive terminated for “cause” would not have continued
to receive the benefit of existing stock-based awards describe din the previous paragraph.
For this purpose, “cause” is defined as engaging in a serious
infraction of Company policy, theft of Company property or services or other dishonest conduct, conduct otherwise injurious to the interests of the Company, or demonstrated unacceptable lateness or absenteeism.
Any other Named Executive Officer who had resigned on the Trigger Date would nevertheless have received any 2014-2016 Performance Shares previously granted to him,
because these awards vested on December 31, 2016. The executive would have had 30 days from the Trigger Date to exercise any Stock Options that had vested as of the Trigger Date. Such a Named Executive Officer would have forfeited all other
outstanding stock-based compensation awards.
Under the terms of Mr. Townsend’s employment offer letter, the Company could have imposed a
Garden
Leave
on Mr. Townsend as of the Trigger Date. During such a period, which could not have exceeded three months, Mr. Townsend would have been excluded from working for the Company and would have been prohibited from working for any
third party and from competing with the Company. The Company would have had to continue paying Mr. Townsend his compensation during the Garden Leave. Had the Company exercised its right to impose a three month Garden Leave on Mr. Townsend as of
the Trigger Date, Mr. Townsend’s salary and housing allowance payments would have cost the equivalent of $197,487.
Death
In the unlikely event that a Named Executive Officer had died on the Trigger Date, that executive’s stock-based awards would have vested and Shares would have
become immediately
deliverable, or cash become immediately payable. The Company would have delivered Shares for the executive’s unvested Performance Shares, or paid cash for the executive’s Performance
Units, using 100% of Performance Shares granted (
Target Performance
), and would have delivered Shares or paid cash for the executive’s unvested Restricted Stock Units and/or Restricted Units. All of the executive’s Stock Options
would have become immediately exercisable. These terms apply to all employees of the Company who have been granted such awards. The Share delivery or cash payment for stock-based awards reflected in the table above was calculated using the closing
price of Shares on the Trigger Date (the
Trigger Date Closing Price
).
Severance-Eligible Termination
(No Change-in-Control)
None of the Named Executive Officers has an employment
agreement or other arrangement that calls for any severance pay in connection with a termination of employment for cause. If one of these Named Executive Officers had been terminated for cause, the executive’s unvested Performance Shares,
Performance Units, and Restricted Stock Units, and all of the executive’s Stock Options, would have been forfeited and the executive would have received no annual award for 2016 performance. For the definition of cause for this purpose, see
above under “Voluntary Resignation.”
Had such a Named Executive Officer been terminated from employment due to job elimination without a
change-in-control having occurred, the executive would have been eligible for severance pay under a severance program for all officer-level employees (or, in Mr. Townsend’s case, equivalent terms promised to him in his employment offer
letter). The severance pay would have been equal to 28 weeks base salary plus one week for every year of service, up to 52 weeks base salary. In order to receive any severance pay, the executive would have had to enter into a separation agreement
that would have included a release of employment-related claims against the Company (a
Separation Agreement
). Each executive would also have been entitled to outplacement services. The cost of these payments and services is reflected in the
table above.
If such a Named Executive Officer’s termination had been due to performance, the amount of severance pay would have been one-half of what it
would have been in the case of job elimination.
|
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|
|
|
|
|
|
2017 Proxy Statement
|
|
92
|
Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End
An employee who would have been Bridge Eligible had the employee been involuntarily terminated with severance pay on the
Trigger Date would have received the benefit of all stock-based awards made in 2005 through 2014 on the same basis as those who were Retirement Eligible. In order to be Bridge Eligible, an employee must enter into a Separation Agreement. None of the
Named Executive Officers had the requisite age and service to qualify for Bridge Eligibility as of the Trigger Date.
Any of the Named Executive Officers whose
employment was terminated with severance pay and who was not Retirement Eligible, had not met the Rule of 65, and was not Bridge Eligible as of the Trigger Date would have had 30 days from the Trigger Date to exercise any Stock Options that had
vested as of the Trigger Date. Such a Named Executive Officer would have received Shares (or cash equivalent) for his 2014-2016 Performance Shares and Performance Units, because these awards vested at the end of the performance period on
December 31, 2016. Such a Named Executive Officer would have been offered pro rata cash payments in consideration of any
2015-2017
and 2016-2018 Performance Shares and Performance Units, contingent on a
Separation Agreement. The amount of payment for these Performance Shares and Performance Units would have been determined using the amount of time that had passed in the performance period through the date of the termination of employment, the
number of Performance Shares or Performance Units granted, the lesser of the performance factor ultimately determined for that three-year performance period or target performance (100%), and the lesser of the closing price of Shares on the date of
grant and the closing price of Shares on the date the Compensation Committee determined the performance factor for that performance period. Such payments would not have been made until after the end of the applicable performance period.
Such an Named Executive Officer would also have been offered a pro rata cash payment for any outstanding Restricted Stock Units or Restricted Units that were to have
vested in their entirety on the third or later anniversary of their grant date, and that had been granted before December 31, 2015. Such a payment would have been based on the amount of time that had passed in the restriction period through the date
of termination of employment.
The estimated cost of these Share-award-related pro rata payments for each Named Executive Officer is reflected in the
table above, using the closing price of Shares on the date of grant and a hypothetical 100% performance factor.
Change-in-Control (Assuming No Alternative Award)
The Company’s
definition of change-in-control is: any person acquires beneficial ownership of 25% or more of MetLife’s voting securities (for this purpose, persons include any group under Rule 13d-5(b) under the Exchange Act, not including MetLife, any
affiliate of MetLife, any Company employee benefit plan, or the MetLife Policyholder Trust); a change in the majority of the membership of MetLife’s Board of Directors (other than any director nominated or elected by other directors) occurs
within any 24-month period; or a completed transaction after which the previous shareholders of MetLife do not own the majority of the voting shares in the resulting company, or do not own the majority of the voting shares in each company that holds
more than 25% of the assets of MetLife prior to the transaction.
Had a change-in-control occurred on the Trigger Date, the Company could have chosen to substitute
an award with at least the same value and at least equivalent material terms that complies with Section 409A (an
Alternative Award
), rather than accelerate the vesting of, and deliver Shares or pay cash for, the existing stock-based
award. Otherwise, the Company would have delivered Shares for the executive’s unvested Performance Shares, or paid cash for the executive’s unvested Performance Units, using Target Performance and the change-in-control price of Shares, and
would have delivered Shares or paid cash for the executive’s unvested Restricted Stock Units and Restricted Units using the change-in-control price of Shares. The Company would have made delivery or payment within 30 days after the
change-in-control, except that if the event did not qualify as a change-in-control as defined in Section 409A, then delivery or payment would have been made following the end of the three-year performance period originally applicable to the
Performance Shares or Performance Units, or following the end of the restriction period applicable to the Restricted Stock Units or Restricted Units.
In addition,
if no Alternative Award had been made, each executive’s unvested Stock Options would have become immediately exercisable, and the Compensation Committee could have chosen to cancel each option in exchange for a cash payment equal to the
difference between the exercise price of the Stock Option and the change-in-control price.
|
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|
2017 Proxy Statement
|
|
93
|
Potential Payments upon Termination or Change-in-Control at 2016 Fiscal Year-End
The estimated cost of these payments and benefits (assuming no Alternative Award) is reflected in the table above. The
payment related to unvested stock-based awards was calculated using the Trigger Date Closing Price.
Change-in-Control Severance-Eligible Termination
In addition to being eligible to receive the payments described above under “Change-in-Control,” each of the Named Executive Officers is eligible to
participate in the Executive Severance Plan. Under this plan, had a change-in-control occurred on the Trigger Date, and had such a Named Executive Officer’s terms and conditions of employment during the three-year period beginning with the
Trigger Date (
Employment Period
) not satisfied specified standards, the Named Executive Officer could have terminated employment and received severance pay and related benefits. These standards include:
|
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|
base pay no lower than the level paid before the change-in-control;
|
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•
|
|
annual bonus opportunities at least as high as other Company executives;
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•
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participation in all long-term incentive compensation programs for key executives at a level at least as high as for other executives of the Company of comparable rank;
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•
|
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aggregate annual bonus and long-term compensation awards at least equal to the aggregate value of such awards for any of the three years prior to the change-in-control;
|
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•
|
|
a pro rata annual bonus for any fiscal year that extends beyond the end of the three-year period at least equal to the same pro rata portion of any of the three annual bonuses granted prior to the change-in-control;
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|
•
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participation in all Company pension, deferred compensation, savings, and other benefit plans at the same level as or better than those made available to other similarly-situated officers;
|
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•
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vacation, indemnification, fringe benefits, and reimbursement of expenses on the same basis as other similarly-situated officers; and
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•
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|
a work location at the same office as the executive had immediately prior to the change-in-control, or within 50 miles of that location.
|
In addition, if the Company had terminated a Named Executive Officer’s employment without cause during the Employment Period, the executive would have received
severance pay and related benefits. For these purposes, cause is defined as the executive’s conviction or plea of
nolo contendere
to a felony, dishonesty or gross misconduct which results or is intended to result in material damage to
the Company’s business or reputation, or repeated, material, willful and deliberate violations by the executive of the executive’s obligations.
Had a
Named Executive Officer listed in the table above qualified for severance pay as of the Trigger Date, the amount would have been two times the sum of the executive’s annual salary rate plus the average of the executive’s annual incentive
awards for the three fiscal years prior to the change-in-control. If the executive would have received a greater net after-tax benefit by reducing the amount of severance pay below the U.S. Internal Revenue Code’s change-in-control excise tax
threshold, the severance pay would have been reduced to an amount low enough to avoid that excise tax.
The executive’s related benefits would have included up
to three years continuation of existing medical, dental, and long-term disability plan benefits.
The estimated cost of these payments and benefits is reflected in
the table above, using the Trigger Date Closing Price and the actuarial present value of continuation of benefits using the same assumptions or principles that are used by the Company for financial reporting purposes under GAAP.
If severance pay and related benefits had become due because the executive voluntarily terminated employment because the Company failed to provide the terms and
conditions specified above during the Employment Period, payment would have been delayed for six months in order to comply with Section 409A.
|
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|
2017 Proxy Statement
|
|
94
|
Proposal 4 — Advisory vote on the Frequency of Future Advisory Votes to
Approve the Compensation Paid to the Company’s
Named Executive Officers
OTHER INFORMATION
Security Ownership of Directors and Executive Officers
The table below shows the number of MetLife equity securities beneficially owned by each of the Directors and Named Executive Officers of MetLife and all the Directors
and Executive Officers as a group. Other than as disclosed in note (6) below, information in this table is reported as of April 14, 2017.
Securities
beneficially owned include, to the extent applicable to a Director, Named Executive Officer, or Executive Officer:
|
•
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|
securities held in each individual’s name;
|
|
•
|
|
securities held by a broker for the benefit of the individual;
|
|
•
|
|
securities which the individual could acquire within the following 60 days (as described in notes (3) and (4) below);
|
|
•
|
|
securities held indirectly in the Savings and Investment Plan; and
|
|
•
|
|
other securities for which the individual may directly or indirectly have or share voting power or investment power (including the power to direct the disposition of the securities).
|
As of April 14, 2017, none of the Directors or Executive Officers of the Company beneficially owned the Company’s Floating Rate Non-Cumulative Preferred Stock,
Series A, or 5.25% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series C.
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Common
Stock
|
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|
|
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|
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|
|
|
|
|
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Name
|
|
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|
|
|
|
|
Amount and
Nature of
Beneficial
Ownership
(1)(2)(3)(4)
|
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|
Percent of
Class
|
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|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steven A.
Kandarian
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,537,749
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Steven J.
Goulart
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
288,218
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Cheryl W.
Grisé
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,705
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Carlos M.
Gutierrez
|
|
|
|
|
|
|
|
|
|
|
|
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12,478
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
John C. R.
Hele
|
|
|
|
|
|
|
|
|
|
|
|
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255,128
|
|
|
|
|
|
|
|
|
|
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*
|
|
|
|
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David L.
Herzog
|
|
|
|
|
|
|
|
|
|
|
|
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2,175
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
R. Glenn
Hubbard
|
|
|
|
|
|
|
|
|
|
|
|
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41,062
|
|
|
|
|
|
|
|
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|
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*
|
|
|
|
|
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Alfred F.
Kelly, Jr.
|
|
|
|
|
|
|
|
|
|
|
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15,141
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|
|
|
|
|
|
|
|
|
|
*
|
|
|
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Edward J.
Kelly, III
|
|
|
|
|
|
|
|
|
|
|
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1,364
|
|
|
|
|
|
|
|
|
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|
*
|
|
|
|
|
|
William E.
Kennard
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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10,826
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
James M.
Kilts(5)
|
|
|
|
|
|
|
|
|
|
|
|
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|
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28,262
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Catherine
R. Kinney
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,966
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Martin J.
Lippert
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
269,497
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Denise M.
Morrison
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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9,037
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Kenton J.
Sicchitano
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,707
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
123,682
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
|
|
Lulu C. Wang
|
|
|
|
|
|
|
|
|
|
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|
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27,339
|
|
|
|
|
|
|
|
|
|
|
*
|
|
|
|
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|
Board of Directors of MetLife, but not in each Director’s individual capacity(6)
|
|
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|
|
|
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|
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162,077,300
|
|
|
|
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14.90%
|
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|
All
Directors and Executive Officers, as a group(7)
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3,242,280
|
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|
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|
|
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|
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|
*
|
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*
|
Number of Shares represents less than one percent of the number of Shares outstanding as of April 14, 2017.
|
|
1
|
Each Director and Named Executive Officer has sole voting and investment power over the Shares shown in this column opposite his or her name, except as indicated in notes (2), (3) and (4) below.
|
|
2
|
Includes, in the case of William E. Kennard, 10 Shares held by the MetLife Policyholder Trust allocated to him in his individual capacity as a beneficiary of the MetLife Policyholder Trust. Directors and Executive
Officers as of April 14, 2017, as a group, were allocated 10 Shares as beneficiaries of the MetLife Policyholder Trust in their individual capacities. The beneficiaries have sole investment power and shared voting power with respect to such Shares.
Note (6) below describes additional beneficial ownership attributed to the Board of Directors as an entity, but not to any Director in an individual capacity, of Shares held by the MetLife Policyholder Trust.
|
|
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|
|
|
|
|
2017 Proxy Statement
|
|
96
|
Security Ownership of Directors and Executive Officers
|
3
|
Includes Shares that are subject to Stock Options which were granted under the MetLife, Inc. 2005 Stock and Incentive Plan and the 2015 Stock and Incentive Plan and are exercisable within 60 days following April 14,
2017. The number of such Stock Options held by each Named Executive Officer is shown in the following table:
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|
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|
Name
|
|
|
|
|
|
|
|
Number
of
Stock Options
Exercisable
Within 60 Days
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
Number of
Stock Options
Exercisable
Within 60 Days
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
Number of
Stock Options
Exercisable
Within 60 Days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
Steven A. Kandarian
|
|
|
|
|
|
|
|
1,285,309
|
|
|
|
|
|
John C. R. Hele
|
|
|
|
|
|
|
|
205,761
|
|
|
|
|
|
Christopher G. Townsend
|
|
|
|
|
|
|
|
123,682
|
|
|
|
|
|
Steven J.
Goulart
|
|
|
|
|
|
|
|
226,281
|
|
|
|
|
|
Martin J. Lippert
|
|
|
|
|
|
|
|
206,823
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
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|
All Executive Officers as of April 14, 2017, as a group, held 2,465,586 Stock Options exercisable within 60 days following April 14, 2017. None of the Directors, except for Mr. Kandarian, held any Stock
Options as of April 14, 2017.
|
|
4
|
Includes Shares deferred under the Company’s nonqualified deferred compensation program (
Deferred Shares
) that the Director or Named Executive Officer could acquire within 60 days following April 14, 2017,
such as by ending employment or service as a Director, or by taking early distribution of the Shares (in some cases with a 10% reduction as provided under the applicable deferred compensation plan). The number of such Deferred Shares held by
individual Directors and Named Executive Officers is shown in the following table:
|
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|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
Number
of
Deferred Shares
That Can
Be Acquired
Within 60 Days
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
Number of
Deferred Shares
That Can
Be Acquired
Within 60 Days
|
|
|
|
|
|
Name
|
|
|
|
|
|
|
|
Number of
Deferred Shares
That Can
Be Acquired
Within 60 Days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cheryl W.
Grisé
|
|
|
|
|
|
|
|
9,997
|
|
|
|
|
|
Edward J. Kelly, III
|
|
|
|
|
|
|
|
1,364
|
|
|
|
|
|
Catherine R. Kinney
|
|
|
|
|
|
|
|
20,114
|
|
|
|
|
|
R. Glenn Hubbard
|
|
|
|
|
|
|
|
33,284
|
|
|
|
|
|
William E. Kennard
|
|
|
|
|
|
|
|
10,816
|
|
|
|
|
|
Kenton J. Sicchitano
|
|
|
|
|
|
|
|
1,368
|
|
|
|
|
|
Alfred F. Kelly, Jr.
|
|
|
|
|
|
|
|
4,804
|
|
|
|
|
|
James M. Kilts
|
|
|
|
|
|
|
|
7,748
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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The number of Deferred Shares reflected in the table immediately above does not include Deferred Shares to the extent the Company would delay delivery of Shares in order to comply with Section 409A. All Directors
and Executive Officers as of April 14, 2017, as a group, held 96,174 Deferred Shares that could be acquired within 60 days following April 14, 2017.
|
|
5
|
Includes 236 Shares held by a limited partnership in which Mr. Kilts and members of his family hold indirect interests.
|
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6
|
This information is reported as of February 23, 2017. The Board of Directors of MetLife, as an entity, but not any Director in his or her individual capacity, is deemed to beneficially own the Shares held by the
MetLife Policyholder Trust because the Board will direct the voting of those Shares on certain matters submitted to a vote of shareholders. This number of Shares deemed owned by the Board of Directors is reflected in Amendment No. 68 to
Schedule 13D referred to under the heading “Security Ownership of Certain Beneficial Owners” on page 99.
|
|
7
|
Does not include Shares held by the MetLife Policyholder Trust that are beneficially owned by the Board of Directors, as an entity, as described in note (6). Includes the Shares in the MetLife Policyholder Trust
allocated to the Directors and Executive Officers in their individual capacities, as described in note (2). Includes 2,465,586 Shares that are subject to Stock Options that are exercisable, and 96,174 Deferred Shares that could be acquired, within
60 days following April 14, 2017, by all Directors and Executive Officers of the Company, as a group, as described in notes (3) and (4), respectively.
|
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|
|
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|
|
|
|
2017 Proxy Statement
|
|
97
|
Deferred Shares Not Beneficially Owned and Deferred Share Equivalents /
Section 16(a) Beneficial Ownership Reporting Compliance
Deferred Shares Not Beneficially Owned and
Deferred Share Equivalents
The following table presents additional items that align the Directors’ and Named Executive Officers’ interests
with those of the Company’s shareholders because their values depend on the price of Shares, but do not represent beneficial ownership of Shares. Deferred Shares that could not be acquired within 60 days following April 14, 2017 are not
considered beneficially owned. Deferred cash compensation or auxiliary cash benefits measured in Share value (
Deferred Share Equivalents
) are not considered Shares beneficially owned because their payment is not made in Shares. The following
table sets forth information on Deferred Shares that could not be acquired within 60 days following April 14, 2017 and Deferred Share Equivalents as of April 14, 2017.
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Name
|
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|
Deferred Shares
Not Beneficially Owned
and/or Deferred Share Equivalents
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Steven A. Kandarian
|
|
|
|
138,759
|
|
|
|
|
|
|
|
Cheryl W.
Grisé
|
|
|
|
28,488
|
|
|
|
|
|
|
|
R. Glenn
Hubbard
|
|
|
|
14,876
|
|
|
|
|
|
|
|
Alfred F. Kelly,
Jr.
|
|
|
|
20,868
|
|
|
|
|
|
|
|
Edward J. Kelly, III
|
|
|
|
5,453
|
|
|
|
|
|
|
|
James M.
Kilts
|
|
|
|
41,083
|
|
|
|
|
|
|
|
Kenton J. Sicchitano
|
|
|
|
5,006
|
|
|
|
|
|
|
|
|
|
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Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company’s Directors, certain officers of the Company, and beneficial owners of more than 10% of
the Shares to file with the SEC initial reports of ownership and reports of changes in ownership of Shares and other equity securities of the Company. Based solely upon a review of the filings furnished to the Company during 2016 or written
representations that no Form 5 was required, the Company believes that all filings required to be made by reporting persons were timely made in accordance with the requirements of the Exchange Act.
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|
2017 Proxy Statement
|
|
98
|
Security Ownership of Certain Beneficial Owners
Security Ownership of Certain Beneficial Owners
The following persons have reported to the SEC beneficial ownership of more than five percent of the Shares:
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Name and Address of Beneficial Owner
|
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|
Amount and
Nature of
Beneficial
Ownership
|
|
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|
Percent of
Class
|
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Beneficiaries of the MetLife
Policyholder Trust(1)
c/o Wilmington Trust Company, as Trustee, Rodney Square North, 1100 North
Market Street Wilmington, DE 19890
|
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|
|
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|
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162,077,300
|
|
|
|
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|
14.9%
|
|
|
|
|
|
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|
BlackRock, Inc.(2)
55 East 52nd Street
New York, NY 10055
|
|
|
|
|
|
|
|
70,977,937
|
|
|
|
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|
6.5%
|
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|
|
|
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|
The Vanguard Group(3)
100 Vanguard Blvd.
Malvern, PA 19355
|
|
|
|
|
|
|
|
63,479,374
|
|
|
|
|
|
5.77%
|
|
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|
|
|
|
|
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1
|
The Board of Directors of the Company has reported to the SEC that, as of February 23, 2017, it, as an entity, had shared voting power over 162,077,300 Shares held in the MetLife Policyholder Trust. The Board’s
report is in Amendment No. 68, filed on February 28, 2017, to the Board’s Schedule 13D. MetLife created the trust when MLIC, a wholly-owned subsidiary of MetLife, converted from a mutual insurance company to a stock insurance company
in April 2000. At that time, eligible MLIC policyholders received beneficial ownership of Shares, and MetLife transferred these Shares to a trust, which is the record owner of the Shares. Wilmington Trust Company serves as trustee. The trust
beneficiaries have sole investment power over the Shares, and can direct the trustee to vote their Shares on matters identified in the trust agreement that governs the trust. However, the trust agreement directs the trustee to vote the Shares held
in the trust on some shareholder matters as recommended or directed by MetLife’s Board of Directors and, on that account, the Board, under SEC rules, shares voting power with the trust beneficiaries and the SEC has considered the Board, as an
entity, a beneficial owner under the rules.
|
|
2.
|
This information is based solely on a Schedule 13G/A filed with the SEC on January 25, 2017 by BlackRock, Inc., which reported beneficial ownership as of December 31, 2016 of 70,977,937 Shares, constituting 6.5% of the
Shares, with sole voting power with respect to 60,970,976 of the Shares, sole dispositive power with respect to 70,929,937 of the Shares, shared voting power with respect to 48,000 of the Shares, and shared dispositive power with respect to 48,000
of the Shares.
|
|
3.
|
This information is based solely on a Schedule 13G/A filed with the SEC on February 10, 2017 by The Vanguard Group, which reported beneficial ownership as of December 31, 2016 of 63,479,374 Shares, constituting 5.77% of
the Shares, with sole voting power with respect to 1,653,980 of the Shares, sole dispositive power with respect to 61,669,972 of the Shares, shared voting power with respect to 171,076 of the Shares, and shared dispositive power with respect to
1,809,402 of the Shares.
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
99
|
Information About the Annual Meeting, Proxy Voting, and Other Information
Information About the Annual Meeting, Proxy Voting, and Other
Information
The Board is not aware of any matters to be presented for a vote at the Annual Meeting other than those described in this Proxy Statement.
If any other matters properly arise at the meeting, your proxy, together with the other proxies received, will be voted at the discretion of the proxy holders designated on the proxy card.
Accessing your proxy materials
MetLife is using “notice and
access” procedures to distribute its proxy materials to its shareholders. MetLife is mailing a Notice of Internet Availability of Proxy Materials (
Notice
) to shareholders. Shareholders who received the Notice may access the proxy
materials over the Internet or, on request, receive a paper copy of the materials by mail or an e-mail copy. The Notice includes instructions on how to access the materials over the Internet and how to request a paper or e-mail copy. The Notice
further provides instructions on how shareholders may elect to receive proxy materials in the future in printed form or by electronic mail.
Some of our
shareholders, including shareholders who previously asked to receive paper copies of the proxy materials, will receive paper copies of the proxy materials.
Electronic delivery of the proxy statement and annual report to shareholders
If you are a shareholder of record, you may choose to receive future proxy statements and annual reports to shareholders electronically by consenting to electronic
delivery online at: www.computershare.com/metlife. If you choose to receive your proxy materials electronically, your choice will remain in effect until you notify MetLife that you wish to discontinue electronic delivery of these documents. You may
provide your notice to MetLife via the Internet at www.computershare.com/metlife.
If you hold your Shares in street name in a stock brokerage account or at a bank
or other nominee, refer to the information provided by that entity for instructions on how to elect this option.
Attending the Annual Meeting
MetLife shareholders of record or their duly appointed proxies are entitled to attend the Annual Meeting.
Holders of record.
If you are
a MetLife shareholder of record and wish to attend the meeting, please so indicate on the proxy card (if you received printed copies of the proxy materials) or as prompted by the telephone or Internet voting systems and an admittance card will be
sent to you. On the day of the meeting, please bring your admittance card, together with photo identification such as a driver’s license, which you will be asked to present to gain entrance to the meeting at 200 Park Avenue, New York, New
York.
Holders in street name.
Beneficial owners whose Shares are
held in street name in a stock brokerage account or by a bank or other nominee also are entitled to attend the meeting. However, because the Company may not have evidence that you are a beneficial owner, you will need to bring proof of your
ownership, together with photo identification such as a driver’s license, to be admitted to the meeting. A recent statement or letter from the record owner (your bank, broker or other nominee) confirming your beneficial ownership, together with
such photo identification, will be acceptable proof.
Shares outstanding and holders of record entitled to vote at the Annual Meeting
There were 1,080,448,287 Shares outstanding as of the April 14, 2017 record date. Each of those Shares is entitled to one vote on each matter to be voted on at the
Annual Meeting.
All holders of record of Shares at the close of business on the April 14, 2017 record date are entitled to vote at the Annual Meeting.
Your vote is important
Whether or not you plan to attend the Annual Meeting,
please take the time to vote your Shares as soon as possible. You may vote your Shares on the Internet, by using a toll-free telephone number or by mailing your proxy card (see your Notice or proxy card for complete instructions, or refer to the
instructions on page 1 of this Proxy Statement).
Voting your Shares
Holders of record.
If you are a shareholder of record or a duly appointed
proxy of a shareholder of record, you may vote by:
|
•
|
|
attending the Annual Meeting and voting in person;
|
|
•
|
|
voting on the Internet or by telephone no later than 11:59 p.m., Eastern Time, June 12, 2017; or
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|
|
|
|
|
|
|
2017 Proxy Statement
|
|
100
|
Information About the Annual Meeting, Proxy Voting, and Other Information
|
•
|
|
mailing your proxy card so that it is received by MetLife, c/o Computershare, P.O. Box 30202, College Station, TX 77842-9909 prior to the Annual Meeting.
|
Instructions about these ways to vote appear on your Notice or proxy card. If you vote on the Internet or by telephone, please have your Notice or proxy card available
for reference when you vote.
For shareholders of record, votes submitted by mail, on the Internet or by telephone will be voted by the individuals named on the
proxy card in the manner you indicate. If you do not specify how your Shares are to be voted, the proxies will vote your Shares FOR Proposal 1 (election of each Director nominee), Proposal 2 (ratification of appointment of independent auditor) and
Proposal 3 (advisory vote to approve compensation paid to the Company’s Named Executive Officers), vote your Shares in favor of a ONE YEAR frequency for future advisory votes on executive compensation on Proposal 4, and vote your Shares AGAINST
Proposal 5 (shareholder proposal to reduce the ownership required for shareholders to call a special meeting).
Holders in street name.
If you are a beneficial owner whose Shares are held
in street name and you wish to vote in person at the Annual Meeting, you must contact your bank, broker or other nominee to obtain its proxy. Bring that document with you to the meeting.
If you do not instruct your broker how to vote on Proposals 1, 3, 4, or 5, your Shares will not be voted (a
Broker Non-Vote
). See “Tabulation of abstentions
and Broker Non-Votes” on page 102 for additional details. Contact your bank, broker or other nominee directly if you have questions.
Changing your
vote or revoking your proxy after it is submitted
Holders of
record.
You may change your vote or revoke your proxy by:
|
•
|
|
subsequently voting on the Internet or by telephone no later than 11:59 p.m., Eastern Time, June 12, 2017;
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|
•
|
|
signing another proxy card with a later date and returning it so that it is received by MetLife, c/o Computershare, P.O. Box 30202, College Station, TX 77842-9909 prior to the Annual Meeting;
|
|
•
|
|
sending your notice of revocation so that it is received by MetLife, c/o Computershare, P.O. Box 30202, College Station, TX 77842-9909 prior to the Annual Meeting or sending your notice of revocation to MetLife via the
Internet at www.investorvote.com/MET no later than 11:59 p.m., Eastern Time, June 12, 2017; or
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|
•
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|
attending the Annual Meeting and voting in person.
|
Holders in street
name.
If you hold your shares in street name in a stock brokerage account or at a bank or other nominee, please contact the brokerage firm, bank or other nominee for instructions on how to change your
vote.
Voting by participants in retirement and savings plans
The
Bank of New York Mellon is trustee for the portion of the Savings and Investment Plan for Employees of Metropolitan Life and Participating Affiliates which is invested in the MetLife Company Stock Fund. It is also the trustee for the portion of the
New England Life Insurance Company Agents’ Retirement Plan and Trust which is invested in the MetLife Company Stock Fund. As trustee, it will vote the Shares in these plans in accordance with the voting instructions given by plan participants
to the trustee. Instructions on voting appear on the voting instruction form distributed to plan participants. The trustee must receive the voting instructions of a plan participant no later than 6:00 p.m., Eastern Time, June 9, 2017. The trustee
will generally vote the Shares held by each plan for which it does not receive voting instructions in the same proportion as the Shares held by such plan for which it does receive voting instructions.
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|
2017 Proxy Statement
|
|
101
|
Information About the Annual Meeting, Proxy Voting, and Other Information
Voting of Shares held in the MetLife Policyholder Trust
The beneficiaries of the MetLife Policyholder Trust may direct Wilmington Trust Company, as trustee, to vote their Shares held in the trust on certain matters that are
identified in the trust agreement governing the trust, including approval of mergers and contested Directors’ elections. On all other matters, the trust agreement directs the trustee to vote the Shares held in the trust as recommended or
directed by the Company’s Board of Directors. The beneficiaries of the trust may not direct the trustee to vote their shares on any matters to be presented at the Annual Meeting.
Vote required to elect Directors
Under the Company’s By-laws, in an
uncontested election, such as the election of Directors at the Annual Meeting, the vote of a majority of the votes cast with respect to a Director’s election at a meeting at which a quorum is present will determine the election of the Director.
Under Delaware law, a Director holds office until the Director’s successor is elected and qualified or until the Director’s earlier resignation or
removal. The Company’s By-Laws provide that, following the certification of the shareholder vote in an uncontested election, such as the election of Directors at the Annual Meeting, any incumbent Director who is a nominee for election as
Director who receives a greater number of votes “against” his or her election than votes “for” his or her election will promptly tender his or her resignation. The Governance and Corporate Responsibility Committee of the Board
will promptly consider the offer to resign and recommend to the Board whether to accept or reject it. The Board of Directors will decide within 90 days following certification of the shareholder vote whether to accept or reject the resignation. The
Board’s decision and, if applicable, the reasons for rejecting the resignation, will be disclosed in a Current Report on Form 8-K filed with the SEC.
Vote required to approve matters other than the election of Directors
The
affirmative vote of the holders of a majority of the Shares voting will be sufficient to ratify the appointment of Deloitte as MetLife’s independent auditor for 2017 (Proposal 2), to approve the advisory vote to approve the compensation
paid to the Company’s Named Executive Officers (Proposal 3), and to approve the shareholder proposal to reduce the ownership
required for shareholders to call a special meeting (Proposal 5). The results of the advisory vote on the frequency of future advisory votes to approve the compensation paid to the
Company’s Named Executive Officers (Proposal 4) will reflect all of the votes cast for each alternative presented, including any abstentions. The alternative receiving the most votes cast will receive a plurality of the votes cast.
Tabulation of abstentions and Broker Non-Votes
If a shareholder abstains
from voting as to the election of Directors (Proposal 1), the ratification of the appointment of Deloitte as MetLife’s independent auditor for 2017 (Proposal 2), the approval of the advisory vote to approve the compensation paid to
the Company’s Named Executive Officers (Proposal 3), the advisory vote on the frequency of future advisory votes (Proposal 4), or the shareholder proposal to reduce the ownership required for shareholders to call a special meeting
(Proposal 5), the shareholder’s Shares will not be counted as voting for or against that matter or, in the case of Proposal 4, any of the alternatives.
If you are a beneficial owner whose Shares are held in street name and you do not submit voting instructions to your broker, your broker may generally vote your Shares
in its discretion on routine matters. Proposal 2 is considered routine and may be voted upon by your broker if you do not submit voting instructions. However, brokers do not have the discretion to vote their clients’ Shares on non-routine
matters, unless the broker receives voting instructions from the beneficial shareholder. Proposals 1, 3, 4 and 5 are considered non-routine matters. Consequently, if your Shares are held in street name, you must provide your broker with
instructions on how to vote your Shares in order for your Shares to be voted on these proposals. If a broker does not cast a vote as to Proposal 1, Proposal 3, Proposal 4 or Proposal 5, the absence of a vote will have the same effect on
those proposals as an abstention, and will not affect the outcome of the vote.
Quorum
To conduct business at the Annual Meeting, a quorum must be present. A quorum will be present if shareholders of record of one-third or more of the Shares entitled to
vote at the meeting are present in person or are represented by proxies. Abstentions and Broker Non-Votes will be counted to determine whether a quorum is present.
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2017 Proxy Statement
|
|
102
|
Information About the Annual Meeting, Proxy Voting, and Other Information
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Proposal
|
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Vote Required
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Effect
of
Abstentions
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Effect of Broker
Non-Votes
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1.
|
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Election of 11 Directors to one-year terms
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Majority of Shares voted
(1)
|
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No effect
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No effect
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2.
|
|
Ratification of the appointment of Deloitte & Touche LLP as MetLife’s independent auditor for 2017
|
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Majority of Shares voted
|
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No effect
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Not applicable
|
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3.
|
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Advisory (non-binding) vote to approve compensation paid to the Company’s Named Executive Officers
|
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Majority of Shares voted
|
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No effect
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|
No effect
|
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4.
|
|
Advisory (non-binding) vote on the frequency of future advisory votes to approve the compensation paid to the Company’s Named Executive
Officers
|
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Plurality of Shares voted
|
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Vote Reflected
in Results
|
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No effect
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5.
|
|
Shareholder proposal to reduce the ownership required for shareholders to call a special meeting
|
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Majority of Shares voted
|
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No effect
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No effect
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1
|
See “Vote required to elect Directors” on page 102.
|
Inspector of Election and confidential voting.
The Board of Directors has appointed IVS Associates, Inc. Inspector of Election at the Annual Meeting. The Company’s By-Laws provide for confidential voting.
Directors’ attendance at annual meetings of shareholders
Directors are
expected to attend annual meetings of shareholders, and 10 out of 12 Directors serving at that time attended MetLife’s 2016 annual meeting of shareholders.
Cost of soliciting proxies for the Annual Meeting
The Company has retained
Georgeson Inc. to assist with the solicitation of proxies from the Company’s shareholders of record. For these services, the Company will pay Georgeson Inc. a fee of approximately $15,000, plus expenses. The Company also will reimburse banks,
brokers or other nominees for their costs of sending the Company’s proxy materials to beneficial owners. Directors, officers or other MetLife employees also may solicit proxies from shareholders in person, or by telephone, facsimile
transmission or other electronic means of communication, but will not receive any additional compensation for such services.
Deadline for submission of
shareholder proposals and nominations for the 2018 annual meeting of shareholders
Rule 14a-8 under the Exchange Act establishes the eligibility requirements and
the procedures that must be followed for a
shareholder’s proposal to be included in a public company’s proxy materials. Under the Rule, proposals submitted for inclusion in MetLife’s 2018 proxy materials must be received by
MetLife, Inc. at 200 Park Avenue, New York, NY 10166, Attention: Corporate Secretary, on or before the close of business on December 28, 2017. If the Company changes this deadline, it will disclose that fact and the new deadline in a Quarterly
Report on
Form 10-Q
or a Current Report on
Form 8-K.
Proposals must comply with all the requirements of Rule 14a-8.
MetLife’s By-Laws permit a shareholder, or a group of up to 20 shareholders, owning Shares continuously for at least three years representing an aggregate of at
least three percent of the voting power entitled to vote in the election of Directors, to nominate and include in MetLife’s proxy materials Director nominees constituting up to the greater of two nominees or 20% of MetLife’s Board,
provided that the shareholders and the Director nominees satisfy the requirements in the By-Laws. Notice of Director nominees for inclusion in the proxy materials must be received by our Corporate Secretary at the address below no earlier than the
close of business on January 14, 2018 and no later than the close of business on February 13, 2018.
A shareholder may present a matter for consideration at
MetLife’s 2018 annual meeting of shareholders (including any shareholder proposal not submitted under Rule 14a-8 or any Director nomination) without requesting that the matter be included in the Company’s Proxy Statement. To do so, the
shareholder must deliver to the MetLife Corporate Secretary no
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|
2017 Proxy Statement
|
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103
|
Information About the Annual Meeting, Proxy Voting, and Other Information
earlier than the close of business on January 14, 2018 and no later than the close of business on February 13, 2018 or such other date as may be announced by the Company in accordance with its
By-Laws a notice and accompanying disclosure questionnaire containing the information required by the advance notice and other provisions of the Company’s By-Laws. Copies of the By-Laws and disclosure questionnaire may be obtained by written
request to MetLife, Inc., 200 Park Avenue, New York, NY 10166, Attention: Corporate Secretary. The By-Laws and disclosure questionnaire also are available on MetLife’s website at www.metlife.com/corporategovernance by selecting the appropriate
category under the heading “Related Links.”
Where to find the voting results of the Annual Meeting
The Company will announce preliminary voting results at the Annual Meeting and publish preliminary or final voting results in a Form 8-K within four business days
following the meeting. If only preliminary voting results are available for reporting in the Form 8-K, the Company will amend the Form 8-K to report final voting results within four business days after the final voting results are known.
Principal executive offices
The principal executive offices of MetLife are
at 200 Park Avenue, New York, NY 10166.
Trademark Information
DOW JONES
is a registered trademark of Dow Jones Trademark Holdings LLC. NATIONAL ASSOCIATION FOR FEMALE EXECUTIVES and NAFE are registered trademarks of Bonnier Working Mother Media, Inc. BLOOMBERG is a registered trademark of Bloomberg Finance One L.P.
INSTITUTIONAL INVESTOR is a registered trademark of Institutional Investor, LLC. NEWSWEEK and GREEN RANKINGS are registered trademarks of Newsweek LLC. All other trademarks are the property of their respective owners.
Communications with the Company’s Directors
The Board of Directors
provides procedures through which security holders may send written communications to individual Directors or the Board of Directors, and procedures through which interested parties may submit communications to the Non-Management
Directors. In addition, the Audit Committee of the Board of Directors provides procedures through which interested parties may submit communications regarding accounting, internal accounting controls or auditing matters to the Audit Committee.
Information about these procedures is available on MetLife’s
website at www.metlife.com/
corporategovernance by selecting “Corporate Conduct” and then the appropriate
link under the “Corporate Conduct” section.
Forward-Looking Statements
This Proxy Statement 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 “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will,” “drive over time,” “become,” “transform,” 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, 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 herein (including that no assurance can be given regarding the form that a separation transaction may take or the specific terms thereof or that a separation will
in fact occur) and in MetLife’s most recent Annual Report on Form 10-K (the
Annual Report on
Form 10-K
) filed with the SEC, any Quarterly Reports on Form 10-Q filed by MetLife with the SEC
after the date of the Annual Report on
Form 10-K
under the captions “Note Regarding Forward-Looking Statements” and “Risk Factors,” and other filings MetLife makes with the SEC.
MetLife does not undertake any obligation to publicly correct or update any forward-looking statement if MetLife later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures MetLife makes on related
subjects in reports to the SEC.
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2017 Proxy Statement
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104
|
Information About the Annual Meeting, Proxy Voting, and Other Information
PROPOSAL 5 —SHAREHOLDER PROPOSAL TO REDUCE THE OWNERSHIP REQUIRED FOR SHAREHOLDERS TO CALL A SPECIAL MEETING
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The Board of Directors recommends that you vote AGAINST this proposal to reduce the ownership requirement
for shareholders to call a special meeting.
|
Shareholder Proposal
William Steiner, 112 Abbottsford Gate, Piermont, New York, 10968, has advised that he is the beneficial owner of no less than 100 shares of voting common stock and that
he intends to introduce the following resolution:
Proposal 5 — Special Shareowner Meetings
Resolved, Shareowners ask our board to take the steps necessary (unilaterally if possible) to amend our bylaws and each appropriate governing document to give holders
in the aggregate of 15% of our outstanding common stock the power to call a special shareowner meeting. This proposal does not impact our board’s current power to call a special meeting.
Dozens of Fortune 500 companies allow 10% of shares to call a special meeting and this proposal is only asking that 15% of our shares be enabled to call a special
meeting. Special meetings allow shareowners to vote on important matters, such as electing new directors that can arise between annual meetings. Shareowner input on the timing of shareowner meetings is especially important when events unfold quickly
and issues may become moot by the next annual meeting. This is important because there could be 15-months or more between annual meetings.
This proposal is
particularly important because we do not have the opportunity to act by written consent. A majority of Fortune 500 companies provide for shareholders to call special meetings and to act by written consent. If our management adopts this proposal it
will be one sign that management values our shareholder input.
Please vote to enhance shareholder value:
Special Shareowner Meetings — Proposal 5
Board of Directors Statement in Opposition
The Board has carefully considered the foregoing shareholder proposal and unanimously recommends a vote AGAINST it because:
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•
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Our By-Laws already permit shareholders owning 25% of the Company’s Shares to call a special meeting. Lowering the ownership threshold may permit a small group of shareholders to misuse this right to serve their
narrow interest.
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•
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Convening a special shareholder meeting is very costly and time consuming. The current 25% threshold strikes the appropriate balance between giving shareholders the ability to call special meetings and protecting the
Company’s resources.
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•
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MetLife’s overall governance framework facilitates ongoing shareholder access to the Board, which has demonstrated accountability and responsiveness.
|
Following our regular investor outreach in 2016, the Board proactively amended and restated the By-Laws to grant shareholders owning 25% of the Company’s Shares to
call a special meeting. The Board believes that this 25% threshold best serves our shareholders’ interests by striking the right balance between giving shareholders the ability to call special meetings and protecting against the risk that a
small group of shareholders could call a special meeting that addresses only a narrow agenda not favored by the majority of the shareholders. The 25% threshold observed by the Company is also the most commonly used threshold for S&P 500
companies that grant shareholders a right to call a special meeting.
Convening a special shareholder meeting is a significant undertaking that involves substantial
expenses and time commitments. The Company must bear the costs associated with the preparation, printing and distribution of the legal disclosure documents and the administration of the meeting. The Board and management must also devote significant
time away from business to prepare and conduct the meeting. Given such administrative and financial burden that a special meeting imposes
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2017 Proxy Statement
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106
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Proposal 5 — Shareholder Proposal to
Reduce the Ownership Required for Shareholders to Call a Special Meeting
on our Company and our shareholders, special shareholder meetings should be convened only to address
pressing matters that a substantial percentage of our shareholders believe must be addressed before the next regular annual meeting.
We believe that if less than
25% of our shareholders want to call a meeting, such lack of support is a good indicator that a given matter should be handled at an annual meeting rather than at a special meeting that would impose unnecessary costs and divert management’s
time and resources away from managing MetLife’s business. Lowering the threshold to 15% would mean that a small minority of shareholders, including those with special interests, can force the Company to incur significant costs and cause
management distraction to call a special meeting when as much as 85% of the shareholders do not want to call a meeting. (The By-Laws also permit the Lead Director, the CEO or the majority of the Board to call a special meeting. Unlike shareholders,
however, each Director is obligated to exercise fiduciary duty to all shareholders when determining whether a special meeting is necessary.) As such, the Board believes that the proposal if implemented would undermine the Company’s ability to
efficiently use its resources and promote the interests of all shareholders.
Moreover, the Board believes this proposal should be evaluated in light of
MetLife’s overall governance framework and the Board’s demonstrated responsiveness. Since 2015, the Board proactively amended the By-Laws to allow eligible stockholders to nominate directors for inclusion in the Company’s proxy
statement and to permit shareholders to call a special meeting,
both in response to investor feedback. The Board also amended the Corporate Governance Guidelines to enhance the Lead Director responsibilities, has held a shareholder say-on-pay vote annually,
and remains committed to shareholder outreach.
Laws and rules applicable to the Company also afford shareholders opportunities to express their view on key
corporate actions. For example, under Delaware law and NYSE rules, MetLife must submit significant matters, such as mergers and consolidations, large share issuances and equity compensation plans, to a shareholder vote. In addition, the Board has
established procedures for shareholders to communicate directly with our Directors outside the annual meeting cycle, which is described on page 104 of this Proxy Statement.
In light of the existing right of MetLife’s shareholders to call a special meeting, as well as the Company’s governance framework, the Board believes this
proposal is unnecessary. Furthermore, the current ownership threshold of 25% of the Company’s Shares for shareholders to call a special meeting strikes the right balance between giving shareholders the ability to call special meetings and
mitigating the risk of unnecessary expenses, business disruptions and misuse of such right by small group of special interest shareholders.
Accordingly, the Board
of Directors recommends that you vote
AGAINST
this proposal to reduce the ownership required for shareholders to call a special meeting.
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2017 Proxy Statement
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107
|
Appendix A – Compensation Discussion and Analysis Supplementary Information
APPENDIX A — COMPENSATION DISCUSSION AND ANALYSIS
SUPPLEMENTARY INFORMATION
Comparator Group and MetLife Revenues,
Total Assets and Market Capitalization
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Comparator Group Company
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|
Revenues(1)(3)
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Total Assets(1)(4)
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Market
Capitalization(2)(4)
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Aflac
Incorporated
|
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|
$ 22,559
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|
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|
$ 129,819
|
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$ 28,404
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|
American International Group,
Inc.
|
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|
$ 52,367
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$ 498,264
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$ 67,082
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The Allstate
Corporation
|
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|
|
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|
$ 36,534
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|
|
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|
$ 108,610
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|
|
|
|
$ 27,294
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|
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|
American Express
Company(6)
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|
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|
$ 32,119
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|
|
|
|
$ 158,893
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|
|
|
|
$ 67,802
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|
AXA
S.A.(5)(7)
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$133,746
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$ 937,422
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$ 61,301
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Bank of America
Corporation(6)
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|
$ 83,701
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$2,187,702
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|
$223,322
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Citigroup
Inc.(6)
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|
$ 69,875
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|
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|
$1,792,077
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|
|
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$169,359
|
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|
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|
The Hartford Financial
Services Group, Inc.
|
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|
$ 18,300
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|
|
|
|
$ 223,432
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|
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|
$ 17,999
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|
HSBC Holdings
plc(5)(6)
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|
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|
$ 47,966
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|
|
$2,374,986
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|
|
|
|
$159,641
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|
JPMorgan Chase &
Co.(6)
|
|
|
|
|
|
$ 95,668
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|
|
|
$2,490,972
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|
|
|
|
|
$308,768
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|
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|
Manulife Financial
Corporation(5)(8)
|
|
|
|
|
|
$ 39,469
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|
|
|
|
|
$ 533,304
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|
|
|
|
$ 35,181
|
|
|
|
|
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Morgan
Stanley(6)
|
|
|
|
|
|
$ 34,631
|
|
|
|
|
|
$ 814,949
|
|
|
|
|
|
$ 79,127
|
|
|
|
|
|
Prudential Financial,
Inc.
|
|
|
|
|
|
$ 58,779
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|
|
|
|
$ 783,962
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|
|
|
|
|
$ 44,746
|
|
|
|
|
|
Sun Life Financial
Inc.(5)(8)
|
|
|
|
|
|
$ 21,144
|
|
|
|
|
|
$ 191,096
|
|
|
|
|
|
$ 23,563
|
|
|
|
|
|
The Travelers Companies,
Inc.
|
|
|
|
|
|
$ 27,625
|
|
|
|
|
|
$ 100,245
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|
|
|
|
|
$ 34,774
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|
|
|
|
|
U.S.
Bancorp(6)
|
|
|
|
|
|
$ 21,308
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|
|
|
|
|
$ 445,964
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|
|
$ 87,312
|
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|
Wells Fargo & Company(6)
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|
|
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|
$ 88,267
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|
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|
$1,930,115
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|
|
|
|
$276,779
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|
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|
|
MetLife
|
|
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|
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|
$ 63,476
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|
|
$ 898,764
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|
|
$ 59,232
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1
|
Source (other than AXA S.A.): 2016 Annual Reports on Forms 10-K, 20-F, or 40-F as applicable. Source for AXA S.A.: 2016 Annual Report.
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|
3
|
Amounts in millions for fiscal year ended December 31, 2016.
|
|
4
|
Amounts in millions as of December 31, 2016.
|
|
5
|
Amounts reported for “Revenues and “Total Assets” under International Financial Reporting Standards. Amount reported for “Revenues” combines financial statement lines for Revenues and Net
Investment Result for comparability to GAAP Revenues. All other companies’ information reported under GAAP.
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6
|
For these companies with banking operations, revenues are shown net of the interest expense associated with deposits, short-term borrowings, trading account liabilities, long-term debt, etc. This is consistent with the
presentation in each company’s financial statements.
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7
|
Amounts converted from Euros at
€
1 = U.S.$1.05, the exchange rate as of December 31, 2016.
|
|
8
|
Amounts converted from Canadian dollars at CAD1 = U.S.$0.74, the exchange rate as of December 31, 2016.
|
|
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|
|
2017 Proxy Statement
|
|
A-1
|
Appendix A – Compensation Discussion and Analysis Supplementary Information
AVIP Performance Funding Level and 2016 Calculation
The calculation has the following features:
|
•
|
|
Operating Earnings is adjusted to eliminate the impact (if any) of variable investment income on an after-tax basis that was higher or lower than the Business Plan goal by 10% or more (
Adjusted AVIP Operating
Earnings
).
|
|
•
|
|
For each one percent deviation in Adjusted AVIP Operating Earnings within three percent above or below Business Plan, the AVIP Performance Funding Level moves one percent up or down. For each one percent deviation
outside of that three percent corridor, the Performance Funding Level moves 2.5% up or down, to a threshold funding level of 50% or maximum funding level of 150%.
|
|
•
|
|
If Adjusted AVIP Operating Earnings were less than 50% of the Business Plan Goal, the Committee would expect to set the AVIP Performance Funding Level at zero – generating no funds for AVIP awards.
|
The Company’s Adjusted AVIP Operating Earnings produced the AVIP Performance Funding Level and resulting amount available for all AVIP awards
for 2016 shown below.
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($ in millions)
|
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|
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|
|
|
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|
|
Operating Earnings
(1)
|
|
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|
|
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|
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$
|
5,790
|
|
|
|
|
|
|
Add shortfall of variable investment income, to the extent more than 10% lower than the Business Plan target
|
|
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$
|
35
|
|
|
|
|
|
|
Sum is Adjusted AVIP Operating Earnings
|
|
|
|
|
|
|
|
|
$
|
5,825
|
|
|
|
|
|
|
Business Plan Operating Earnings goal
|
|
|
|
|
|
|
|
|
$
|
6,265
|
|
|
|
|
|
|
Adjusted AVIP Operating Earnings as a percentage of Business Plan Operating Earnings goal
|
|
|
|
|
|
|
|
|
|
93
|
%
|
|
|
|
|
|
AVIP Performance Funding Level (for Adjusted AVIP Operating Earnings of 93% of Business Plan goal):
100%-3%-(4 x 2.5%) = 87%
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|
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|
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|
|
|
87
|
%
|
|
|
|
|
|
Total target-performance planning amount of all employees’ AVIP (the
AVIP Planning Target
)
|
|
|
|
|
|
|
|
|
$
|
475
|
|
|
|
|
|
|
Total amount available for all AVIP equals AVIP Performance Funding Level times AVIP Planning Target
|
|
|
|
|
|
|
|
|
$
|
413
|
|
|
|
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|
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1
|
The 2016 results of Operating Earnings have been adjusted to exclude Separation costs of $232 million, net of income tax, and certain non-cash charges of $469 million, net of income tax. The Compensation Committee
determined to so adjust Operating Earnings for this purpose. See “Annual Incentive Awards” on page 58.
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|
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|
|
|
|
2017 Proxy Statement
|
|
A-2
|
Appendix A – Compensation Discussion and Analysis Supplementary Information
Performance Share Performance Factor
|
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|
|
Operating
ROE
Performance
as a Percentage of
Business Plan Goal
|
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|
|
|
|
Performance
Factor
|
|
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|
|
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|
Below
Threshold
|
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|
|
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|
|
0-79%
|
|
|
|
|
|
0%
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|
Threshold
|
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|
80%
|
|
|
|
|
|
25%
|
|
|
|
|
|
Target
|
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|
|
|
|
|
|
100%
|
|
|
|
|
|
100%
|
|
|
|
|
|
Maximum
|
|
|
|
|
|
|
|
120%
|
|
|
|
|
|
175%
|
|
|
|
|
|
Above
Maximum
|
|
|
|
|
|
|
|
121%+
|
|
|
|
|
|
175%
|
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|
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|
|
TSR Performance as a
Percentile of Peers
|
|
|
|
|
|
Performance
Factor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Below
Threshold
|
|
|
|
|
|
|
|
0-24th %ile
|
|
|
|
|
|
0%
|
|
|
|
|
|
Threshold
|
|
|
|
|
|
|
|
25th %ile
|
|
|
|
|
|
25%
|
|
|
|
|
|
Target
|
|
|
|
|
|
|
|
50th %ile
|
|
|
|
|
|
100%
|
|
|
|
|
|
Maximum
|
|
|
|
|
|
|
|
87.5th %ile
|
|
|
|
|
|
175%
|
|
|
|
|
|
Above
Maximum
|
|
|
|
|
|
|
|
87.6th-99th %ile
|
|
|
|
|
|
175%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
If the Company’s TSR for the performance period is zero or negative, the Committee intends to cap the entire
performance factor at 100%.
Performance Share TSR Comparators
|
|
|
|
|
• Aegon N.V.
• Aflac Incorporated
• AIA Group Limited
• Allianz SE
• The Allstate Corporation
• American International Group, Inc.
• Assicurazioni Generali S.p.A.
• Aviva PLC
• AXA S.A.
• The Dai-ichi Life Insurance Company, Limited
• The Hartford Financial Services Group
Inc.
• Legal & General Group
PLC
|
|
• Lincoln National Corporation
• Manulife Financial Corporation
• Ping An Insurance (Group) Company of
China, Ltd.
• Principal Financial
Group, Inc.
• Prudential Financial,
Inc.
• Prudential plc
• The Travelers Companies, Inc.
• Unum Group
• Zurich Financial Services
AG
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
A-3
|
Appendix B – Non-GAAP and Other Financial Disclosures
APPENDIX B – NON-GAAP AND OTHER FINANCIAL DISCLOSURES
|
|
|
|
|
|
|
|
|
|
|
Any references in this Proxy Statement (except in this
section and the tables that accompany this section) to:
|
|
|
|
should be read as, respectively:
|
|
|
|
|
|
|
|
(i)
|
|
net income (loss);
|
|
|
|
(i)
|
|
net income (loss) available to MetLife, Inc.’s common shareholders;
|
|
|
|
|
|
|
|
(ii)
|
|
operating earnings;
|
|
|
|
(ii)
|
|
operating earnings available to common shareholders;
|
|
|
|
|
|
|
|
(iii)
|
|
operating earnings per share;
|
|
|
|
(iii)
|
|
operating earnings available to common shareholders per diluted common share;
|
|
|
|
|
|
|
|
(iv)
|
|
book value per share;
|
|
|
|
(iv)
|
|
book value per common share, excluding accumulated other comprehensive income (
AOCI
) other than foreign currency translation adjustment (
FCTA
);
|
|
|
|
|
|
|
|
(v)
|
|
premiums, fees and other revenues;
|
|
|
|
(v)
|
|
premiums, fees and other revenues (operating);
|
|
|
|
|
|
|
|
(vi)
|
|
operating return on equity; and
|
|
|
|
(vi)
|
|
operating return on MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA; and
|
|
|
|
|
|
|
|
(vii)
|
|
operating tangible return on equity
|
|
|
|
(vii)
|
|
operating return on MetLife, Inc.’s tangible common stockholders’ equity.
|
In this Proxy Statement, MetLife presents certain measures of its performance that are not calculated in accordance with accounting
principles generally accepted in the United States of America (
GAAP
). MetLife believes that these non-GAAP financial measures enhance the understanding of MetLife’s performance by highlighting the results of operations and the underlying
profitability drivers of the business.
The following non-GAAP financial measures should not be viewed as substitutes for the most directly comparable financial
measures calculated in accordance with GAAP:
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP financial measures:
|
|
|
|
Comparable GAAP financial measures:
|
|
|
|
|
|
|
|
(i)
|
|
operating premiums, fees and other revenues
|
|
|
|
(i)
|
|
premiums, fees and other revenues
|
|
|
|
|
|
|
|
(ii)
|
|
operating earnings available to common shareholders
|
|
|
|
(ii)
|
|
net income (loss) available to MetLife, Inc.’s common shareholders
|
|
|
|
|
|
|
|
(iii)
|
|
operating earnings available to common shareholders on a constant currency basis
|
|
|
|
(iii)
|
|
net income (loss) available to MetLife, Inc.’s common shareholders
|
|
|
|
|
|
|
|
(iv)
|
|
operating earnings available to common shareholders, adjusted for total Notable Items
|
|
|
|
(iv)
|
|
net income (loss) available to MetLife, Inc.’s common shareholders
|
|
|
|
|
|
|
|
(v)
|
|
operating earnings available to common shareholders, adjusted for total Notable Items, on a constant currency basis
|
|
|
|
(v)
|
|
net income (loss) available to MetLife, Inc.’s common shareholders
|
|
|
|
|
|
|
|
(vi)
|
|
operating earnings available to common shareholders per diluted common share
|
|
|
|
(vi)
|
|
net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share
|
|
|
|
|
|
|
|
(vii)
|
|
operating return on equity
|
|
|
|
(vii)
|
|
return on equity
|
|
|
|
|
|
|
|
(viii)
|
|
MetLife, Inc.’s tangible common stockholders’ equity
|
|
|
|
(viii)
|
|
MetLife, Inc.’s stockholders’ equity
|
|
|
|
|
|
|
|
(ix)
|
|
MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA
|
|
|
|
(ix)
|
|
MetLife, Inc.’s stockholders’ equity
|
|
|
|
|
|
|
|
(x)
|
|
free cash flow of all holding companies
|
|
|
|
(x)
|
|
MetLife, Inc.’s net cash provided by (used in) operating activities
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-1
|
Appendix B – Non-GAAP and Other Financial Disclosures
Reconciliations of these non-GAAP measures to the most directly comparable historical GAAP
measures are included in this section. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures is not accessible on a forward-looking basis because we believe it is not possible without unreasonable efforts to
provide other than a range of net investment gains and losses and net derivative gains and losses, which can fluctuate significantly within or outside the range and from period to period and may have a material impact on net income.
MetLife’s definitions of the various non-GAAP and other financial measures discussed in this Proxy Statement may differ from those used by other companies:
Operating earnings and related measures:
|
•
|
|
operating earnings available to common shareholders;
|
|
•
|
|
operating earnings available to common shareholders on a constant currency basis;
|
|
•
|
|
operating earnings available to common shareholders, adjusted for total Notable Items;
|
|
•
|
|
operating earnings available to common shareholders, adjusted for total Notable Items, on a constant currency basis; and
|
|
•
|
|
operating earnings available to common shareholders per diluted common share.
|
These measures are used by management to
evaluate performance and allocate resources. Consistent with GAAP guidance for segment reporting, operating earnings is also MetLife’s GAAP measure of segment performance. Operating earnings and other financial measures based on operating
earnings are also the measures by which MetLife senior management’s and many other employees’ performance is evaluated for the purposes of determining their compensation under applicable compensation plans. Operating earnings and other
financial measures based on operating earnings allow analysis of our performance relative to our business plan and facilitate comparisons to industry results.
Operating earnings is defined as operating revenues less operating expenses, both net of income tax. Operating earnings available to common shareholders is defined as
operating earnings less preferred stock dividends.
Operating revenues and operating expenses
These financial measures, along with the related operating premiums, fees and other revenues, focus on our primary businesses principally by excluding
the impact of market volatility, which could distort trends, and revenues and costs related to non-core products and divested businesses and certain entities required to be consolidated under GAAP. Also, these measures exclude results of
discontinued operations and other businesses that have been or will be sold or exited by MetLife and are referred to as divested businesses. In addition, for the year ended December 31, 2016, operating revenues and operating expenses exclude
the financial impact of converting MetLife’s Japan operations to calendar-year end reporting without retrospective application of this change to prior periods and is referred to as lag elimination. Operating revenues also excludes net
investment gains (losses) (
NIGL
) and net derivative gains (losses) (
NDGL
). Operating expenses also excludes goodwill impairments.
The
following additional adjustments are made to revenues, in the line items indicated, in calculating operating revenues:
|
|
•
|
|
Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to NIGL and NDGL and certain variable annuity guaranteed minimum income benefits (
GMIB
) fees (
GMIB
fees
);
|
|
|
•
|
|
Net investment income: (i) includes earned income on derivatives and amortization of premium on derivatives that are
hedges of investments or that are used to replicate certain investments but do not qualify for hedge accounting treatment, (ii) includes income from discontinued real estate operations, (iii) excludes post-tax operating earnings
adjustments relating to insurance joint ventures accounted for under the equity method, (iv) excludes certain amounts related to contractholder-directed unit-linked
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-2
|
Appendix B – Non-GAAP and Other Financial Disclosures
|
|
investments, and (v) excludes certain amounts related to securitization entities that are variable interest entities (
VIEs
) consolidated under GAAP; and
|
|
|
•
|
|
Other revenues are adjusted for settlements of foreign currency earnings hedges.
|
The following
additional adjustments are made to expenses, in the line items indicated, in calculating operating expenses:
|
|
•
|
|
Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to NIGL and NDGL, (ii) inflation-indexed benefit adjustments associated with
contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments, (iii) benefits and
hedging costs related to GMIBs (
GMIB costs
), and (iv) market value adjustments associated with surrenders or terminations of contracts (
Market value adjustments
);
|
|
|
•
|
|
Interest credited to policyholder account balances includes adjustments for earned income on derivatives and amortization of premium on derivatives that are hedges of policyholder account balances but do not qualify for
hedge accounting treatment and excludes amounts related to net investment income earned on contractholder-directed unit-linked investments;
|
|
|
•
|
|
Amortization of deferred policy acquisition costs (
DAC
) and value of business acquired (
VOBA
) excludes amounts related to: (i) NIGL and NDGL, (ii) GMIB fees and GMIB costs and (iii) Market
value adjustments;
|
|
|
•
|
|
Amortization of negative VOBA excludes amounts related to Market value adjustments;
|
|
|
•
|
|
Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and
|
|
|
•
|
|
Other expenses excludes costs related to: (i) noncontrolling interests, (ii) implementation of new insurance regulatory requirements, and (iii) acquisition, integration and other costs.
|
Operating earnings also excludes the recognition of certain contingent assets and liabilities that could not be recognized at acquisition or adjusted for during the
measurement period under GAAP business combination accounting guidance.
The tax impact of the adjustments mentioned above are calculated net of the U.S. or foreign
statutory tax rate, which could differ from the Company’s effective tax rate. Additionally, the provision for income tax (expense) benefit also includes the impact related to the timing of certain tax credits, as well as certain tax reforms.
Return on equity, allocated equity, tangible equity and related measures:
|
•
|
|
MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA: MetLife, Inc.’s common stockholders’ equity, excluding the net unrealized investment gains (losses) and defined benefit
plans adjustment components of AOCI, net of income tax.
|
|
•
|
|
MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA, adjusted for total Notable Items.
|
|
•
|
|
Operating return on MetLife, Inc.‘s common stockholders’ equity, excluding AOCI other than FCTA: operating earnings available to common shareholders divided by MetLife, Inc.‘s average common
stockholders’ equity, excluding AOCI other than FCTA.
|
|
•
|
|
Operating return on MetLife, Inc.‘s common stockholders’ equity: operating earnings available to common shareholders divided by MetLife, Inc.‘s average common stockholders’ equity.
|
|
•
|
|
Return on MetLife, Inc.‘s common stockholders’ equity, excluding AOCI other than FCTA: net income (loss) available to MetLife, Inc.’s common shareholders divided by MetLife, Inc.‘s average common
stockholders’ equity, excluding AOCI other than FCTA.
|
|
•
|
|
Return on MetLife, Inc.’s common stockholders’ equity: net income (loss) available to MetLife, Inc.’s common shareholders divided by MetLife, Inc.’s average common stockholders’ equity.
|
|
•
|
|
Allocated equity: portion of MetLife, Inc.’s common stockholders’ equity that management allocates to each of its
segments and sub-segments based on local capital requirements and economic capital. Economic capital is an internally developed risk capital model, the
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-3
|
Appendix B – Non-GAAP and Other Financial Disclosures
|
|
purpose of which is to measure the risk in the business and to provide a basis upon which capital is deployed. MetLife management periodically reviews this model to ensure that it remains
consistent with emerging industry practice standards and the local capital requirements; allocated equity may be adjusted if warranted by such review. Allocated equity excludes the impact of AOCI other than FCTA.
|
|
•
|
|
Operating return on allocated equity: operating earnings available to common shareholders divided by allocated equity.
|
|
•
|
|
Return on allocated equity: net income (loss) available to MetLife, Inc.’s common shareholders divided by allocated equity.
|
The above measures represent a level of equity consistent with the view that, in the ordinary course of business, we do not plan to sell most investments for the sole
purpose of realizing gains or losses. Also refer to the utilization of operating earnings and other financial measures based on operating earnings mentioned above.
|
•
|
|
MetLife, Inc.’s tangible common shareholders’ equity or tangible equity: MetLife, Inc.’s common stockholders’ equity, excluding the net unrealized investment gains (losses) and defined benefit plans
adjustment components of AOCI reduced by the impact of goodwill, value of distribution agreements (VODA) and value of customer relationships acquired (VOCRA), all net of income tax.
|
|
•
|
|
MetLife, Inc.’s tangible common stockholders’ equity, adjusted for total Notable Items.
|
|
•
|
|
Operating return on MetLife, Inc.‘s tangible common stockholders’ equity: operating earnings available to common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by MetLife,
Inc.‘s average tangible common stockholders’ equity.
|
|
•
|
|
Return on MetLife, Inc.’s tangible common stockholders’ equity: net income (loss) available to MetLife, Inc.’s common shareholders, excluding goodwill impairment and amortization of VODA and VOCRA, net of
income tax, divided by MetLife, Inc.‘s average tangible common stockholders’ equity.
|
|
•
|
|
Operating return on allocated tangible equity: operating earnings available to common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by allocated tangible equity.
|
|
•
|
|
Return on allocated tangible equity: net income (loss) available to MetLife, Inc.’s common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by allocated tangible equity.
|
The above measures are, when considered in conjunction with regulatory capital ratios, a measure of capital adequacy.
The following additional information is relevant to an understanding of MetLife’s performance results:
|
•
|
|
Operating expense ratio: calculated by dividing operating expenses (other expenses, net of capitalization of DAC) by operating premiums, fees and other revenues.
|
|
•
|
|
Statistical sales information for Asia is calculated using 10% of single-premium deposits (mainly from retirement products such as variable annuity, fixed annuity and pensions), 20% of single-premium deposits from
credit insurance and 100% of annualized full-year premiums and fees from recurring-premium policy sales of all products (mainly from risk and protection products such as individual life, accident & health and group). Sales statistics do not
correspond to revenues under GAAP, but are used as relevant measures of business activity.
|
|
•
|
|
All comparisons on a constant currency basis reflect the impact of changes in foreign currency exchange rates and are calculated using the average foreign currency exchange rates for the current period and are applied
to each of the comparable periods.
|
|
•
|
|
Asymmetrical and non-economic accounting refer to: (i) the portion of net derivative gains (losses) on embedded
derivatives attributable to the inclusion of MetLife’s credit spreads in the liability valuations, (ii) hedging activity that generates net derivative gains (losses) and creates fluctuations in net income because hedge accounting cannot be
achieved and the item being hedged does not a have an offsetting gain or loss recognized in earnings, (iii) inflation-indexed benefit adjustments associated with contracts
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-4
|
Appendix B – Non-GAAP and Other Financial Disclosures
|
|
backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass
through adjustments, and (iv) impact of changes in foreign currency exchange rates on the re-measurement of foreign denominated unhedged funding agreements and financing transactions to the U.S. dollar and the re-measurement of certain
liabilities from non-functional currencies to functional currencies. MetLife believes that excluding the impact of asymmetrical and non-economic accounting from total GAAP results enhances investor understanding of MetLife’s performance by
disclosing how these accounting practices affect reported GAAP results.
|
|
•
|
|
MetLife uses a measure of free cash flow to facilitate an understanding of its ability to generate cash for reinvestment into its businesses or use in non-mandatory capital actions. MetLife defines free cash flow as the
sum of cash available at MetLife’s holding companies from dividends from operating subsidiaries, expenses and other net flows of the holding companies (including capital contributions to subsidiaries), and net contributions from debt to be at
or below target leverage ratios. This measure of free cash flow is prior to capital actions, such as common stock dividends and repurchases, debt reduction and mergers and acquisitions. Free cash flow should not be viewed as a substitute for net
cash provided by (used in) operating activities calculated in accordance with GAAP. The free cash flow ratio is typically expressed as a percentage of annual operating earnings available to common shareholders.
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-5
|
Appendix B – Non-GAAP and Other Financial Disclosures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions, except per share data)
|
|
|
|
|
|
|
|
Total Company—Reconciliation of Net Income (Loss) Available to MetLife, Inc.’s Common Shareholders to Operating Earnings Available to Common Shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) available to MetLife, Inc.’s common shareholders
|
|
|
|
|
|
$
|
697
|
|
|
$
|
0.63
|
|
|
|
|
|
|
$
|
5,152
|
|
|
$
|
4.57
|
|
|
|
|
|
|
|
|
Adjustments from net income (loss) available to MetLife, Inc.’s common shareholders to operating
earnings available to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net investment gains (losses)
|
|
|
|
|
|
|
171
|
|
|
|
0.15
|
|
|
|
|
|
|
|
597
|
|
|
|
0.53
|
|
|
|
|
|
|
|
|
Less: Net derivative gains (losses)
|
|
|
|
|
|
|
(6,760
|
)
|
|
|
(6.10
|
)
|
|
|
|
|
|
|
38
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
Less: Goodwill impairment
|
|
|
|
|
|
|
(260
|
)
|
|
|
(0.23
|
)
|
|
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
Less: Other adjustments to continuing operations
|
|
|
|
|
|
|
80
|
|
|
|
0.07
|
|
|
|
|
|
|
|
(1,091
|
)
|
|
|
(0.96
|
)
|
|
|
|
|
|
|
|
Less: Provision for income tax (expense) benefit
|
|
|
|
|
|
|
2,381
|
|
|
|
2.15
|
|
|
|
|
|
|
|
178
|
|
|
|
0.16
|
|
|
|
|
|
|
|
|
Add: Net income (loss) attributable to noncontrolling interests
|
|
|
|
|
|
|
4
|
|
|
|
—
|
|
|
|
|
|
|
|
12
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
Add: Preferred stock repurchase premium
|
|
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
42
|
|
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders
(1)(2)
|
|
|
|
|
|
$
|
5,089
|
|
|
$
|
4.59
|
|
|
|
|
|
|
$
|
5,484
|
|
|
$
|
4.86
|
|
|
|
|
|
|
|
|
Less: Total Notable Items
|
|
|
|
|
|
|
(974
|
)
|
|
|
(0.88
|
)
|
|
|
|
|
|
|
(898
|
)
|
|
|
(0.80
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders, adjusted for total Notable Items
|
|
|
|
|
|
$
|
6,063
|
|
|
$
|
5.47
|
|
|
|
|
|
|
$
|
6,382
|
|
|
$
|
5.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding—diluted (In millions)
|
|
|
|
|
|
|
|
|
|
|
1,108.5
|
|
|
|
|
|
|
|
|
|
|
|
1,128.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia—Operating Earnings Available to Common Shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders
|
|
|
|
|
|
$
|
1,242
|
|
|
|
|
|
|
|
|
|
|
$
|
1,380
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Total Notable Items
|
|
|
|
|
|
|
(79
|
)
|
|
|
|
|
|
|
|
|
|
|
36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders, adjusted for total Notable
Items
|
|
|
|
|
|
$
|
1,321
|
|
|
|
|
|
|
|
|
|
|
$
|
1,344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders on a constant currency basis
|
|
|
|
|
|
$
|
1,242
|
|
|
|
|
|
|
|
|
|
|
$
|
1,426
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders, adjusted for total Notable Items,
on a constant currency basis
|
|
|
|
|
|
$
|
1,321
|
|
|
|
|
|
|
|
|
|
|
$
|
1,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Company—Premiums, Fees and Other Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total premiums, fees and other revenues
|
|
|
|
|
|
$
|
50,118
|
|
|
|
|
|
|
|
|
|
|
$
|
50,035
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Unearned revenue adjustments
|
|
|
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: GMIB fees
|
|
|
|
|
|
|
411
|
|
|
|
|
|
|
|
|
|
|
|
382
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Settlement of foreign currency earnings hedges
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
(37
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Less: Divested businesses and lag elimination
(3)
|
|
|
|
|
|
|
497
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating premiums, fees and other revenues
|
|
|
|
|
|
$
|
49,178
|
|
|
|
|
|
|
|
|
|
|
$
|
49,681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on MetLife, Inc.’s:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stockholders’ equity
|
|
|
|
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
|
|
|
7.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Common stockholders’ equity, excluding AOCI other than FCTA
|
|
|
|
|
|
|
1.2
|
%
|
|
|
|
|
|
|
|
|
|
|
9.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common stockholders’ equity
(4)
|
|
|
|
|
|
|
1.6
|
%
|
|
|
|
|
|
|
|
|
|
|
11.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Operating return on MetLife, Inc.’s:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stockholders’ equity
|
|
|
|
|
|
|
7.1
|
%
|
|
|
|
|
|
|
|
|
|
|
8.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Common stockholders’ equity, excluding AOCI other than FCTA
|
|
|
|
|
|
|
8.9
|
%
|
|
|
|
|
|
|
|
|
|
|
9.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common stockholders’ equity
(4)
|
|
|
|
|
|
|
10.8
|
%
|
|
|
|
|
|
|
|
|
|
|
11.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Return on Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on allocated equity
|
|
|
|
|
|
|
12.6
|
%
|
|
|
|
|
|
|
|
|
|
|
15.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Return on allocated tangible equity
(5)
|
|
|
|
|
|
|
21.7
|
%
|
|
|
|
|
|
|
|
|
|
|
26.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Operating return on allocated equity
|
|
|
|
|
|
|
11.2
|
%
|
|
|
|
|
|
|
|
|
|
|
12.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Operating return on allocated tangible equity
(5)
|
|
|
|
|
|
|
19.4
|
%
|
|
|
|
|
|
|
|
|
|
|
20.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-6
|
Appendix B – Non-GAAP and Other Financial Disclosure
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book Value(6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per common share
|
|
|
|
|
|
$
|
59.56
|
|
|
|
|
|
|
|
|
|
|
$
|
60.00
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net unrealized investment gains (losses), net of income tax
|
|
|
|
|
|
|
11.53
|
|
|
|
|
|
|
|
|
|
|
|
10.72
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Defined benefit plans adjustment, net of income tax
|
|
|
|
|
|
|
(1.80
|
)
|
|
|
|
|
|
|
|
|
|
|
(1.87
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per common share, excluding AOCI other than FCTA
(7)
|
|
|
|
|
|
$
|
49.83
|
|
|
|
|
|
|
|
|
|
|
$
|
51.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shares outstanding, end of period (In millions)
|
|
|
|
|
|
|
1,095.5
|
|
|
|
|
|
|
|
|
|
|
|
1,098.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MetLife, Inc.’s Common Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total MetLife, Inc.’s stockholders’ equity
|
|
|
|
|
|
$
|
67,309
|
|
|
|
|
|
|
|
|
|
|
$
|
67,949
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Preferred stock
|
|
|
|
|
|
|
2,066
|
|
|
|
|
|
|
|
|
|
|
|
2,066
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MetLife, Inc.’s common stockholders’ equity
|
|
|
|
|
|
|
65,243
|
|
|
|
|
|
|
|
|
|
|
|
65,883
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net unrealized investment gains (losses), net of income tax
|
|
|
|
|
|
|
12,631
|
|
|
|
|
|
|
|
|
|
|
|
11,773
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Defined benefit plans adjustment, net of income tax
|
|
|
|
|
|
|
(1,972
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,052
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than
FCTA
|
|
|
|
|
|
|
54,584
|
|
|
|
|
|
|
|
|
|
|
|
56,162
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Goodwill, net of income tax
|
|
|
|
|
|
|
9,112
|
|
|
|
|
|
|
|
|
|
|
|
9,314
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: VODA and VOCRA, net of income tax
|
|
|
|
|
|
|
404
|
|
|
|
|
|
|
|
|
|
|
|
494
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total MetLife, Inc.’s tangible common stockholders’ equity (excludes AOCI other than
FCTA)
|
|
|
|
|
|
$
|
45,068
|
|
|
|
|
|
|
|
|
|
|
$
|
46,354
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average common stockholders’ equity
|
|
|
|
|
|
$
|
71,634
|
|
|
|
|
|
|
|
|
|
|
$
|
68,674
|
|
|
|
|
|
|
|
|
|
|
|
|
Average common stockholders’ equity, excluding AOCI other than FCTA
|
|
|
|
|
|
$
|
57,291
|
|
|
|
|
|
|
|
|
|
|
$
|
56,412
|
|
|
|
|
|
|
|
|
|
|
|
|
Average tangible common stockholders’ equity (excludes AOCI other than
FCTA)
|
|
|
|
|
|
$
|
47,412
|
|
|
|
|
|
|
|
|
|
|
$
|
46,346
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allocated equity
|
|
|
|
|
|
$
|
11,045
|
|
|
|
|
|
|
|
|
|
|
$
|
11,509
|
|
|
|
|
|
|
|
|
|
|
|
|
Allocated tangible equity
|
|
|
|
|
|
$
|
6,431
|
|
|
|
|
|
|
|
|
|
|
$
|
6,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
The 2016 results of operating earnings available to common shareholders, operating earnings available to common shareholders per diluted common share and operating return on MetLife, Inc.’s common
stockholders’ equity, excluding AOCI other than FCTA, include certain non-cash charges totaling $469 million, net of income tax, and Separation costs of $232 million, net of income tax. Excluding these items, these results would be $5,790
million, $5.22 and 9.9%, respectively. See “Highlights of 2016 Business Results” on page 43 for additional information.
|
|
2
|
The 2015 results of operating earnings available to common shareholders, operating earnings available to common shareholders per diluted common share and operating return on MetLife, Inc.’s common
stockholders’ equity, excluding AOCI other than FCTA, include a non-cash charge of $792 million, net of income tax, related to an uncertain tax position. Excluding this charge, these results would have been $6,276 million, $5.56 and 11.1%,
respectively. See “Highlights of 2016 Business Results” on page 43 for additional information.
|
|
3
|
For the year ended December 31, 2016, divested businesses and lag elimination includes adjustments related to the financial impact of converting MetLife’s Japan operations to calendar year end reporting without
retrospective application of this change to prior periods.
|
|
4
|
Operating earnings available to common shareholders and net income available to common shareholders, used to calculate returns on tangible equity, exclude the impact of amortization of VODA and VOCRA, net of income tax,
for the years ended December 31, 2016 and 2015 of $47 million and $48 million, respectively.
|
|
5
|
Operating earnings available to common shareholders and net income available to common shareholders, used to calculate returns on allocated tangible equity, exclude the impact of amortization of VODA and VOCRA, net of
income tax, for both years ended December 31, 2016 and 2015 of $4 million.
|
|
6
|
Book value excludes $2,066 million of equity related to preferred stock at both December 31, 2016 and 2015.
|
|
7
|
The 2015 result of book value per common share, excluding AOCI other than FCTA, includes a non-cash charge of $792 million, net of income tax, related to an uncertain tax position. Excluding this charge, the result
would have been $51.87. See “Highlights of 2016 Business Results” on page 43 for additional information.
|
|
|
|
|
|
|
|
|
|
2017 Proxy Statement
|
|
B-7
|
Appendix B – Non-GAAP and Other Financial Disclosure
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
|
|
|
|
|
|
Total Company—Reconciliation of Net Income (Loss) Available to MetLife, Inc.’s Common Shareholders to Operating Earnings Available to Common Shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) available to MetLife, Inc.’s common shareholders
|
|
|
|
|
|
|
|
|
|
$
|
6,187
|
|
|
|
|
|
|
|
|
|
|
$
|
3,246
|
|
|
|
|
|
|
|
|
|
|
$
|
1,202
|
|
|
|
|
|
|
|
|
Adjustments from net income (loss) available to MetLife, Inc.’s common shareholders to operating
earnings available to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net investment gains (losses)
|
|
|
|
|
|
|
|
|
|
|
(197
|
)
|
|
|
|
|
|
|
|
|
|
|
161
|
|
|
|
|
|
|
|
|
|
|
|
(352
|
)
|
|
|
|
|
|
|
|
Less: Net derivative gains (losses)
|
|
|
|
|
|
|
|
|
|
|
1,317
|
|
|
|
|
|
|
|
|
|
|
|
(3,239
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,919
|
)
|
|
|
|
|
|
|
|
Less: Goodwill impairment
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
(1,868
|
)
|
|
|
|
|
|
|
|
Less: Other adjustments to continuing operations
|
|
|
|
|
|
|
|
|
|
|
(1,376
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,597
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,492
|
)
|
|
|
|
|
|
|
|
Less: Provision for income tax (expense) benefit
|
|
|
|
|
|
|
|
|
|
|
(87
|
)
|
|
|
|
|
|
|
|
|
|
|
1,683
|
|
|
|
|
|
|
|
|
|
|
|
2,174
|
|
|
|
|
|
|
|
|
Less: Income (loss) from discontinued operations, net of income tax
|
|
|
|
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
48
|
|
|
|
|
|
|
|
|
Add: Net income (loss) attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
27
|
|
|
|
|
|
|
|
|
|
|
|
25
|
|
|
|
|
|
|
|
|
|
|
|
38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
$
|
6,560
|
|
|
|
|
|
|
|
|
|
|
$
|
6,261
|
|
|
|
|
|
|
|
|
|
|
$
|
5,649
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in billions)
|
|
|
|
|
|
|
|
Reconciliation of Net Cash Provided by Operating Activities of MetLife, Inc. to Free Cash Flow of All Holding Companies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MetLife, Inc. (parent company only) net cash provided by operating
activities
|
|
|
|
|
|
|
|
|
|
$
|
3.7
|
|
|
|
|
|
|
|
|
|
|
$
|
1.6
|
|
|
|
|
|
|
|
|
|
|
$
|
2.6
|
|
|
|
|
|
|
|
|
|
|
$
|
1.9
|
|
|
|
|
|
|
|
|
|
|
$
|
2.6
|
|
|
|
|
|
|
|
|
Adjustments from net cash provided by operating activities to free cash flow:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add: Incremental debt to be at or below target leverage ratios
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
1.8
|
|
|
|
|
|
|
|
|
|
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
Add: Remaining adjustments from net cash provided by operating activities to free cash
flow
(1)
|
|
|
|
|
|
|
|
|
|
|
(2.3
|
)
|
|
|
|
|
|
|
|
|
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
(0.3
|
)
|
|
|
|
|
|
|
|
|
|
|
0.2
|
|
|
|
|
|
|
|
|
|
|
|
(1.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MetLife, Inc. (parent company only) free cash flow
|
|
|
|
|
|
|
|
|
|
|
1.4
|
|
|
|
|
|
|
|
|
|
|
|
3.5
|
|
|
|
|
|
|
|
|
|
|
|
2.7
|
|
|
|
|
|
|
|
|
|
|
|
2.1
|
|
|
|
|
|
|
|
|
|
|
|
1.1
|
|
|
|
|
|
|
|
|
Other MetLife, Inc. holding companies free cash flow
(2)
|
|
|
|
|
|
|
|
|
|
|
1.0
|
|
|
|
|
|
|
|
|
|
|
|
0.5
|
|
|
|
|
|
|
|
|
|
|
|
0.2
|
|
|
|
|
|
|
|
|
|
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow of all holding companies(3)
|
|
|
|
|
|
|
|
|
|
$
|
2.4
|
|
|
|
|
|
|
|
|
|
|
$
|
4.0
|
|
|
|
|
|
|
|
|
|
|
$
|
2.9
|
|
|
|
|
|
|
|
|
|
|
$
|
2.2
|
|
|
|
|
|
|
|
|
|
|
$
|
1.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of net cash provided by operating activities to consolidated net income (loss)
available to MetLife, Inc.’s
common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MetLife, Inc. (parent company only) net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|
$
|
3.7
|
|
|
|
|
|
|
|
|
|
|
$
|
1.6
|
|
|
|
|
|
|
|
|
|
|
$
|
2.6
|
|
|
|
|
|
|
|
|
|
|
$
|
1.9
|
|
|
|
|
|
|
|
|
|
|
$
|
2.6
|
|
|
|
|
|
|
|
|
Consolidated net income (loss) available to MetLife, Inc.’s common shareholders
(3)
|
|
|
|
|
|
|
|
|
|
$
|
0.7
|
|
|
|
|
|
|
|
|
|
|
$
|
5.2
|
|
|
|
|
|
|
|
|
|
|
$
|
6.2
|
|
|
|
|
|
|
|
|
|
|
$
|
3.2
|
|
|
|
|
|
|
|
|
|
|
$
|
1.2
|
|
|
|
|
|
|
|
|
Ratio of net cash provided by operating activities (parent company only) to consolidated
net income (loss) available to MetLife, Inc.’s common shareholders
(3)(4)
|
|
|
|
|
|
|
|
|
|
|
538
|
%
|
|
|
|
|
|
|
|
|
|
|
31
|
%
|
|
|
|
|
|
|
|
|
|
|
42
|
%
|
|
|
|
|
|
|
|
|
|
|
57
|
%
|
|
|
|
|
|
|
|
|
|
|
218
|
%
|
|
|
|
|
|
|
|
Ratio of free cash flow to operating earnings available to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow of all holding companies
(5)
|
|
|
|
|
|
|
|
|
|
$
|
2.4
|
|
|
|
|
|
|
|
|
|
|
$
|
4.0
|
|
|
|
|
|
|
|
|
|
|
$
|
2.9
|
|
|
|
|
|
|
|
|
|
|
$
|
2.2
|
|
|
|
|
|
|
|
|
|
|
$
|
1.5
|
|
|
|
|
|
|
|
|
Consolidated operating earnings available to common shareholders
(5)
|
|
|
|
|
|
|
|
|
|
$
|
5.1
|
|
|
|
|
|
|
|
|
|
|
$
|
5.5
|
|
|
|
|
|
|
|
|
|
|
$
|
6.6
|
|
|
|
|
|
|
|
|
|
|
$
|
6.3
|
|
|
|
|
|
|
|
|
|
|
$
|
5.6
|
|
|
|
|
|
|
|
|
Ratio of free cash flow of all holding companies to consolidated operating earnings
available to common shareholders
(5)
|
|
|
|
|
|
|
|
|
|
|
48
|
%
|
|
|
|
|
|
|
|
|
|
|
73
|
%
|
|
|
|
|
|
|
|
|
|
|
44
|
%
|
|
|
|
|
|
|
|
|
|
|
36
|
%
|
|
|
|
|
|
|
|
|
|
|
26
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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1
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Remaining adjustments include: (i) capital contributions to subsidiaries; (ii) returns of capital from subsidiaries; (iii) repayments on and (issuances of) loans to subsidiaries, net; and (iv) investment portfolio and
derivatives changes and other, net.
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2
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Components include: (i) dividends and returns of capital from subsidiaries; (ii) capital contributions from MetLife, Inc.; (iii) capital contributions to subsidiaries; (iv) repayments on and (issuances of) loans to
subsidiaries, net; (v) other expenses; and (vi) investment portfolio changes and other, net.
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3
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Consolidated net income (loss) available to MetLife, Inc.’s common shareholders for 2016 includes Separation-related costs of $0.07 billion, net of income tax. Excluding this amount from the denominator of the
ratio, this ratio, as adjusted, would be 487%. Consolidated net income (loss) available to MetLife, Inc.’s common shareholders for 2015 includes a non-cash charge of $0.8 billion, net of income tax, related to an uncertain tax position.
Excluding this charge from the denominator of the ratio, this ratio, as adjusted, would be 27%.
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2017 Proxy Statement
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B-8
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Appendix B – Non-GAAP and Other Financial Disclosure
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4
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Including the free cash flow of other MetLife, Inc. holding companies of $1.0 billion, $0.5 billion and $0.2 billion for the years ended December 31, 2016, 2015 and 2014, respectively, in the numerator of the ratio,
this ratio, as adjusted, would be 681%, 40% and 46%, respectively. Including the free cash flow of other MetLife, Inc. holding companies in the numerator of the ratio and excluding the Separation-related costs and uncertain tax position non-cash
charge from the denominator of the ratio, this ratio, as adjusted, would be 617% and 35% for the years ended December 31, 2016 and 2015, respectively.
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5
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In 2016, we incurred $2.3 billion of Separation-related items which reduced our holding companies’ liquid assets, as well as our free cash flow. Excluding these Separation-related items, adjusted free cash flow
would be $4.7 billion for the year ended December 31, 2016. Consolidated operating earnings available to common shareholders for 2016 was negatively impacted by Notable Items, primarily related to the actuarial assumption review and other insurance
adjustments, of $1.0 billion, net of income tax, and Separation-related costs of $0.02 billion, net of income tax. Excluding the Separation-related items, which reduced free cash flow, from the numerator of the ratio and excluding such Notable
Items and Separation-related costs negatively impacting consolidated operating earnings available to common shareholders from the denominator of the ratio, the adjusted free cash flow ratio for 2016 would be 77%. Consolidated operating earnings
available to common shareholders for 2015 includes a non-cash charge of $0.8 billion, net of income tax, related to an uncertain tax position. Excluding this charge from the denominator of the ratio, the adjusted free cash flow ratio for 2015 would
be 63%.
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2017 Proxy Statement
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B-9
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Using a
black ink
pen, mark your votes with an
X
as shown in this example. Please do not write outside the designated areas.
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☒
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Voting Instructions
Electronic Voting available 24 hours a day, 7 days a week!
Instead of mailing your Proxy Card/Voting Instruction Form, you may choose one of the other voting methods outlined below to vote your Proxy Card/Voting
Instruction Form.
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
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Vote by telephone
• Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone
telephone
• Follow the
instructions provided by the recorded message
Vote by Internet
• Go to
www.investorvote.com/MET
• Or scan the QR code with your smartphone
• Follow the steps outlined on the
secure website
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Vote by mail
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•
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To vote by mail, mark, sign and date your Proxy Card/Voting Instruction Form and return it in the enclosed postage-paid envelope.
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q
IF YOU HAVE NOT VOTED VIA THE INTERNET
OR
TELEPHONE, FOLD ALONG THE
PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
q
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B
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Proposals — The following items are more fully described in the Proxy Statement accompanying this card. The Board of Directors has proposed and recommends a vote
FOR
all the nominees listed,
FOR
Proposals 2 and 3, and for ONE (1) YEAR in Proposal 4. The Board of Directors recommends a vote
AGAINST
Proposal 5.
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1. Election of Directors:
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For
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Against
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Abstain
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For
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Against
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Abstain
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For
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Against
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Abstain
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01 - Cheryl W. Grisé
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☐
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05 - Steven A. Kandarian
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☐
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☐
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☐
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09 - James M. Kilts
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☐
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02 - Carlos M. Gutierrez
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06 - Alfred F. Kelly, Jr.
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☐
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☐
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☐
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10 - Catherine R. Kinney
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03 - David L. Herzog
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07 - Edward J. Kelly, III
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11 - Denise M. Morrison
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04 - R. Glenn Hubbard, Ph.D.
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☐
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08 - William E. Kennard
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For
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Against
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Abstain
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For
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Against
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Abstain
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2. Ratification of
Appointment of Deloitte & Touche LLP as Independent Auditor for 2017
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☐
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☐
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☐
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5. Shareholder Proposal to Reduce the Ownership Required for Shareholders to Call a Special Meeting
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☐
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☐
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☐
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3. Advisory Vote to Approve
the Compensation Paid to the Company’s Named Executive Officers
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☐
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☐
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☐
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1 Year
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2 Year
s
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3 Years
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Abstain
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4. Advisory Vote on the
Frequency of Future Advisory Votes to Approve the Compensation Paid to the Company’s Named Executive Officers
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☐
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☐
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C
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Authorized Signatures — THIS SECTION MUST BE COMPLETED FOR YOUR VOTE TO BE COUNTED. — Date and Sign Below
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Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full
title.
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Date (mm/dd/yyyy) — Please print date below.
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Signature 1 — Please keep signature within the
box.
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Signature 2 — Please keep
signature within the box.
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IF VOTING BY MAIL, YOU MUST COMPLETE SECTIONS B AND C ABOVE. PLEASE COMPLETE SECTION A ON THE OTHER SIDE OF THE CARD IF APPLICABLE.
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YOUR VOTE IS IMPORTANT. PLEASE REMEMBER TO CAST YOUR VOTE TODAY.
We encourage you to take advantage of Internet or telephone voting.
Both are available 24 hours a day, 7 days a week.
Common Shareholders
-
Internet and telephone voting are available through 11:59 PM Eastern Time, June 12, 2017.
Proxy Cards submitted by common shareholders who
vote by mail must be received prior to the 2017 Annual Meeting.
MetLife and New England Employee Benefit Plan Participants
- Internet and telephone voting are available through 6:00 PM Eastern Time,
June 9, 2017.
Voting Instruction Forms submitted by plan participants who vote by mail must be received by 6:00 PM, Eastern Time, June 9,
2017.
Your Internet or telephone vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed and returned your Proxy Card/Voting Instruction Form.
Please see reverse for instructions on voting by Internet, telephone or mail.
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Proxy Statement, Annual Report and Chairman’s Letter are available at
http://investor.metlife.com
.
Common shareholders may consent to receive MetLife, Inc.’s Annual Reports to Shareholders, Proxy Statement and other shareholder communications
electronically at
www.computershare.com/metlife
.
q
IF YOU HAVE
NOT VOTED VIA THE INTERNET
OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
q
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Proxy Card/Voting Instruction Form — MetLife, Inc.
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+
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Proxy solicited on behalf of the Board of Directors of
MetLife, Inc. for the 2017 Annual Meeting, June 13, 2017
Common Shareholders
The shareholder(s) whose signature(s) appear(s) on the reverse side of this Proxy Card hereby appoint(s) Stephen W. Gauster and Timothy J. Ring, or either of
them, each with full power of substitution, as proxies to vote all shares of MetLife, Inc. Common Stock that the shareholder(s) would be entitled to vote on all matters that may properly come before the 2017 Annual Meeting and at any adjournments or
postponements thereof. The proxies are authorized to vote and will vote in accordance with the specifications indicated by the shareholder(s) on the reverse of this Proxy Card.
If this Proxy Card is signed and returned by the shareholder(s), and
no specifications are indicated, the proxies are authorized to vote as recommended by the Board of Directors of MetLife, Inc.
If this Proxy Card is signed and returned, the proxies appointed thereby will be authorized to vote in their discretion
on any other matters that may be presented for a vote at the 2017 Annual Meeting and at any adjournments or postponements thereof.
Plan
Participants
The Bank of New York Mellon is the Trustee (the “Plan Trustee”) of (i) the Savings and Investment Plan for Employees of
Metropolitan Life and Participating Affiliates Trust and (ii) the New England Life Insurance Company Agents’ Retirement Plan and Trust. Each of (i) and (ii) above is referred to herein individually as a “Plan.”
As a Plan participant, you have the right to direct the Plan Trustee how to vote the shares of MetLife, Inc. Common Stock (“Shares”) that are
allocated to your Plan account and shown on the reverse of this Voting Instruction Form. The Plan Trustee will hold your instructions in complete confidence except as may be necessary to meet legal requirements.
You may instruct the Plan Trustee how to vote by telephone, Internet or by signing and returning this Voting Instruction Form. See the reverse side of this
form for instructions on how to vote. A postage-paid envelope is enclosed. The Plan Trustee must receive your voting instructions no later than 6:00 p.m., Eastern Time, June 9, 2017, to vote in accordance with the instructions.
The Plan Trustee will vote your Plan Shares in accordance with the specifications indicated by you on the reverse of this Voting Instruction Form.
If the
Plan Trustee does not receive your instructions by 6:00 p.m., Eastern Time, June 9, 2017, or if you sign and return this Voting Instruction Form and no specifications are indicated, the Plan Trustee will vote your Plan Shares in the same proportion
as the Plan Shares for which it has received instructions.
On any matters other than those described on the reverse of this Voting Instruction Form that may be presented for a vote at the 2017 Annual Meeting and any adjournments or postponements
thereof, your Plan Shares will be voted in the discretion of the proxies appointed by the shareholders of MetLife, Inc.
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A
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Non-Voting Items
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☐
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Change of
Address
— Please print new address below.
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Meeting Attendance
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Mark box to the right if
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you plan to attend the
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Annual Meeting.
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(Continued and to be marked, dated and
signed, on the other side)
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∎
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IF VOTING BY MAIL, YOU MUST COMPLETE SECTIONS B AND C ON THE OTHER
SIDE OF THE CARD.
PLEASE COMPLETE SECTION A ABOVE IF APPLICABLE
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+
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Meeting Information
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Meeting Type:
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Annual Meeting
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For holders as of:
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April 14, 2017
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Date:
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June 13, 2017
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Time:
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2:30 p.m. Eastern Time
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Location:
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MetLife, Inc.
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200 Park Avenue
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New York, New York 10166
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You are receiving this communication because you hold shares in the company named above.
This is not a ballot. You cannot use this notice to vote these shares. This communication presents only an overview of the more complete
proxy materials that are available to you on the Internet or by mail. You may view the proxy materials online at
http://investor.metlife.com
, scan the QR code on the reverse side, or easily request a paper copy (see below).
We encourage you to access and review all of the important information contained in the proxy materials before voting.
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See below to obtain proxy materials and the reverse side for voting instructions.
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*** Exercise Your
Right
to Vote ***
Important Notice Regarding the Availability of Proxy Materials for the
Shareholder Meeting to Be Held on June 13, 2017.
Before You Vote
How to Access the
Proxy Materials
Proxy Materials Available to VIEW or RECEIVE:
1. NOTICE AND PROXY STATEMENT 2. ANNUAL
REPORT 3. CHAIRMAN’S LETTER
How to View Online:
Have the information that is printed in the shaded bar above and visit:
http://investor.metlife.com
, or scan the QR code.
How to Request and Receive a PAPER or E-MAIL Copy:
If you want to receive a paper or e-mail copy of these documents, you must request one. There is NO charge for requesting a copy. Please choose
one of the following methods to make current and future delivery requests.
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1)
BY INTERNET:
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www.investorvote.com/MET
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2)
BY TELEPHONE:
|
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1-866-641-4276
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3)
BY E-MAIL*:
|
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investorvote@computershare.com
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*
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If requesting materials by e-mail, please send to
investorvote@computershare.com
with “Proxy Materials MetLife” in the subject line. Include in the message your full name and address, plus the number
located in the shaded bar above, and state in the e-mail that you want a paper or e-mail copy of the current meeting materials. You can also state your preference to receive a paper or e-mail copy for future meetings.
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Please make the request as instructed above on or before May 30, 2017 to facilitate timely delivery.
C O Y
02B8YH
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How To Vote
Please Choose One of the Following Voting Methods
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Vote In Person:
Many shareholder meetings have attendance requirements including, but not limited to,
the possession of an attendance ticket issued by the entity holding the meeting. Please check the meeting materials for any special requirements for meeting attendance. At the meeting, you will need to request a ballot to vote these shares. The
directions to the location of the 2017 Annual Meeting are available at
http://investor.metlife.com
.
Vote By
Internet:
To vote by Internet, go to
www.investorvote.com/MET
or from a smart phone, scan the QR code above. Have the information that is printed in the shaded bar located on the reverse side available and follow the instructions.
Vote By Mail:
You can vote by mail by requesting a paper copy of the materials, which will include a Proxy Card/Voting
Instruction Form.
Vote By Telephone:
Call toll free 1-800-652-VOTE (8683) within the USA, US
territories & Canada on a touch tone telephone. Follow the instructions provided by the recorded message.
The Board of Directors recommends a vote FOR all the nominees listed, FOR Proposals 2 and 3, and for ONE (1) YEAR in Proposal 4.
1. Election of Directors
Nominees:
01 - Cheryl W. Grisé
02 - Carlos M. Gutierrez
03
- David L. Herzog
04 - R. Glenn Hubbard, Ph.D.
05 - Steven A. Kandarian
06
- Alfred F. Kelly, Jr.
07 - Edward J. Kelly, III
08 - William E. Kennard
09 -
James M. Kilts
10 - Catherine R. Kinney
11 - Denise M. Morrison
2. Ratification of
Appointment of Deloitte & Touche LLP as Independent Auditor for 2017
3. Advisory Vote to Approve the Compensation Paid to the Company’s Named
Executive Officers
4. Advisory Vote on the Frequency of Future Advisory Votes to Approve the Compensation Paid to the Company’s Named Executive
Officers
The Board of Directors recommends a
vote AGAINST Proposal 5.
5. Shareholder Proposal to Reduce the Ownership Required for Shareholders to Call a Special Meeting
NOTE:
Such other business as may
properly come before the meeting or any adjournment thereof.